The post 50-Year Mortgages: What Bill Pulte Does When He Isn’t Reviewing Mortgages of Trump’s Enemies appeared first on CEPR.

What this means: On a weekly basis, Realtor.com reports the year-over-year change in active inventory, new listings and median prices. On a monthly basis, they report total inventory. For October, Realtor.com reported active inventory was up 15.3% YoY, but still down 13.2% compared to the 2017 to 2019 same month levels. 
Here is their weekly report: Weekly Housing Trends: Latest Data as of Nov. 8

• Active inventory climbed 12.8% year over year

The number of homes active on the market climbed 12.8% year-over-year, as the streak of annual gains stretched past two years in length. There were about 1.1 million homes for sale last week, marking the 28th week in a row over the million-listing threshold. Active inventory is growing due to both new listings hitting the market and listings taking longer to sell in this weak 2025 sales year.

• New listings—a measure of sellers putting homes up for sale—rose 10.5% year over year

New listings were up 10.5% last week compared with the same period a year ago. New listing growth has ping-ponged in recent weeks as we enter the slowest period of the year for selling homes. Take this double-digit improvement with a grain of salt, as it marks an improvement over an already-low figure from last year. However, if we do continue to see more new listings coming onto the market, it could be due to mortgage rates hovering in the low-6% range and enticing homeowners to make a move.

• The median listing price fell 1.0% year-over-year

The median list price dropped compared to the same week one year ago. Adjusting for home size, price per square foot fell 1.1% year-over-year, dropping for the tenth consecutive week. Price per square foot grew steadily for almost two years, but the weak sales activity has finally caught up and shaken underlying home values despite stable prices.

My end-of-week morning train WFH reads:

• The Dow Is Close to 50,000. How the Heck Did We Get Here So Fast? The Dow Jones Industrial Average took 103 years to reach 10,000, in 1999, after starting at 40.94 in 1896. Milestones at 20,000, 30,000, and 40,000 occurred in rapid succession starting in 2017, with decreasing fanfare. The Dow is now approaching 50,000, with annualized gains of 6.4% from 10,000 in 1999. (Barron’s)

• Google is trying to take down a group sending you all those spammy texts: A new lawsuit details what allegedly happens after you click that fake USPS link. (The Verge) see also The hidden, horrifying world behind all those recruitment scam texts: The people likely to be sending them are victims, too. (Vox)

• A Winning Investment Strategy Sitting Right Under Your Nose (If You Can Hold It): It works to buy stocks after they’ve gotten wrecked. (Morningstar)

• Trump Is Falling Into the Same “Affordability” Trap That Ensnared Biden: Republicans learned nothing from how badly Dems bungled inflation. Turns out it’s easy to win while running as an outsider promising “affordability.” It’s much harder to actually do anything about it. (The Bulwark)

• Why Gen Z Hates Work: When you spend hours each day watching influencers get rich without much effort, you forget what it takes to succeed in this world. (The Free Press)

• How two tiny banks are helping Trump’s sons build a crypto empire: Dominari Holdings and Yorkville Advisors are benefiting from close connections with Eric and Donald Trump Jr. (Financial Times)

• When Will We Make God? The key driver of the AI Bubble. Hyperscalers believe they might build God within the next few years. That’s one of the main reasons they’re spending billions on AI, soon trillions. They think it will take us just a handful of years to get to AGI—Artificial General Intelligence, the moment when an AI can do nearly all virtual human tasks better than nearly any human. They think it’s a straight shot from there to superintelligence—an AI that is so much more intelligent than humans that we can’t even fathom how it thinks. A God. (Uncharted Territories)

• People don’t want to visit the U.S. Can this new ad convince them otherwise? A new ad campaign aims to sell an idealized America to increasingly skeptical travelers. (Fast Company) 

• How do you move a village? Residents of France’s last outpost in North America try to outrun the sea As rising tides eat away at the Saint-Pierre and Miquelon archipelago off Canada, plans to move the historic village to higher ground have divided residents. (The Guardian)

• Ben Stiller Was Hollywood’s Funny Guy. But He’s Always Been Serious. He’s best known as a comedy star who defined the Gen X sensibility. But what he really wants is to work behind the camera. (Wall Street Journal)

Be sure to check out our Masters in Business interview  this weekend with Bankim “Binky” Chadha, Chief US Equity & Global Strategist and Head of Asset Allocation at Deutsche Bank Securities, a role he has held since 2004.

 

Bonds are not as positively correlated to equities as they were in 2022, they are no longer negatively correlated either.

Source: Jurrien Timmer, Fidelity Investments

 

Sign up for our reads-only mailing list here.

 

 

The post 10 Friday AM Reads appeared first on The Big Picture.

Confronting Anti-Ellis Island Immigration

Authored by Victor Davis Hanson via American Greatness,

Between 1892 and 1954, approximately 12 million immigrants arrived at the now-iconic Ellis Island to enter the U.S.—or nearly 200,000 legal entries per year.

All were registered, documented, and given rudimentary health exams.

They arrived as rich and poor, white and non-white, and, without exception, legally.

With the gradual decline of such great influxes, Ellis Island finally ceased operating roughly 71 years ago.

Yet Ellis Island’s successful tenure offers a sharp contrast to the failures of our recent open-border catastrophes.

Americans will never know how many immigrants swarmed the southern border between 2021 and 2025, when Joe Biden and his impeached Homeland Security Secretary Alejandro Mayorkas destroyed federal immigration law as we once knew it.

By design, they allowed between 10 and 12 million foreign nationals to make a mockery of federal immigration laws by swarming the southern border.

Many crossers grew violent at any sign of even meek efforts by ICE officers to enforce the law. Border Patrol officers were often mocked, threatened, and assaulted by arriving illegal aliens.

Officers were unsure as to what was worse: the occasional violence from illegal immigrants or retaliation from the Biden administration if they sought to enforce federal law and block illegal entrants.

So the Biden administration pulled off the near impossible. In a mere four years, it had invited in almost as many illegal immigrants as had entered through Ellis Island legally over seven decades.

But unlike past immigrants, we now witness organized violence against ICE officials. We see Orwellian scenes of mobs burning the American flag—the flag of the country they demand to stay in—while waving the flags of the countries they have no desire or intention of returning to.

In sum, three generations ago, a smaller, poorer, but wiser America properly solved its immigration problem at Ellis Island—welcoming in immigrants orderly and legally with health and background screenings.

In contrast, during the Biden years, we, in our arrogance and affluence, engaged in a great experiment—or rather misadventure. Never in our history has the U.S. been home to roughly 53 million foreign-born residents.

Never have immigrants comprised nearly 16 percent of the population.

Never has California had 27 percent of its residents not born in the U.S.

Never have we allowed in up to 10,000 aliens a day, with little concern for whether they carried fentanyl, had criminal records, were sick, were unvaccinated, were traffickers, or belonged to violent gangs.

Worse still, the Biden administration made zero effort to acculturate, integrate, and assimilate this massive influx. In fact, they did the very opposite of Ellis Island’s protocols, which fostered pro-American values, melting-pot integration, and respect for American history and culture. Once upon a time, new arrivals were all expected to become Americans—or why else had they come?

Now, the moment an illegal alien has entered the U.S., he likely senses that his ethnicity or race will be essential to his identity. In the minds of the ruling DEI commissariat, claiming a tribal identity offers an easy pathway to generous housing, food, healthcare, legal, and educational entitlements.

So, under Biden’s immigration non-policy, almost all illegal immigrants were immediately categorized as victims in the Marxist binary ledger that now divides America into the oppressed vs. the oppressors.

If one devised a plan to damage America, he could not have done better than further dividing us by tribal chauvinism, overwhelming our fragile social services so essential to struggling Americans, and fueling the already dangerous neo-Confederate state and local nullifications of federal law and the growth of “sanctuary cities.”

Daily, we witness performance-art mayors and governors boasting of how they “resist” federal law enforcement. These modern rebels pose as if they are our own era’s versions of mini-Confederate states. They now brag of states’ rights as they dare the federal government to protect its own property and enforce federal laws within their parochial jurisdictions.

Why did Biden—or whoever was making policy in his place—destroy the border?

What was his utterly mad intent?

To alter the nation’s demography by importing future Democrat constituents dependent on state largesse?

To bow to the demands of his DEI base?

To mindlessly do the opposite of the prior Trump administration, which had closed the border and returned to legal-only immigration?

Virtue signaling while waving illegal aliens across an open border is easy.

But trying to close the border and return millions who entered unlawfully to their homelands is nearly impossible.

It is surreal that those who claimed moral superiority while systemically destroying federal law now condemn as immoral those striving to restore it.

Tyler Durden Thu, 11/13/2025 - 20:05

Confronting Anti-Ellis Island Immigration

Authored by Victor Davis Hanson via American Greatness,

Between 1892 and 1954, approximately 12 million immigrants arrived at the now-iconic Ellis Island to enter the U.S.—or nearly 200,000 legal entries per year.

All were registered, documented, and given rudimentary health exams.

They arrived as rich and poor, white and non-white, and, without exception, legally.

With the gradual decline of such great influxes, Ellis Island finally ceased operating roughly 71 years ago.

Yet Ellis Island’s successful tenure offers a sharp contrast to the failures of our recent open-border catastrophes.

Americans will never know how many immigrants swarmed the southern border between 2021 and 2025, when Joe Biden and his impeached Homeland Security Secretary Alejandro Mayorkas destroyed federal immigration law as we once knew it.

By design, they allowed between 10 and 12 million foreign nationals to make a mockery of federal immigration laws by swarming the southern border.

Many crossers grew violent at any sign of even meek efforts by ICE officers to enforce the law. Border Patrol officers were often mocked, threatened, and assaulted by arriving illegal aliens.

Officers were unsure as to what was worse: the occasional violence from illegal immigrants or retaliation from the Biden administration if they sought to enforce federal law and block illegal entrants.

So the Biden administration pulled off the near impossible. In a mere four years, it had invited in almost as many illegal immigrants as had entered through Ellis Island legally over seven decades.

But unlike past immigrants, we now witness organized violence against ICE officials. We see Orwellian scenes of mobs burning the American flag—the flag of the country they demand to stay in—while waving the flags of the countries they have no desire or intention of returning to.

In sum, three generations ago, a smaller, poorer, but wiser America properly solved its immigration problem at Ellis Island—welcoming in immigrants orderly and legally with health and background screenings.

In contrast, during the Biden years, we, in our arrogance and affluence, engaged in a great experiment—or rather misadventure. Never in our history has the U.S. been home to roughly 53 million foreign-born residents.

Never have immigrants comprised nearly 16 percent of the population.

Never has California had 27 percent of its residents not born in the U.S.

Never have we allowed in up to 10,000 aliens a day, with little concern for whether they carried fentanyl, had criminal records, were sick, were unvaccinated, were traffickers, or belonged to violent gangs.

Worse still, the Biden administration made zero effort to acculturate, integrate, and assimilate this massive influx. In fact, they did the very opposite of Ellis Island’s protocols, which fostered pro-American values, melting-pot integration, and respect for American history and culture. Once upon a time, new arrivals were all expected to become Americans—or why else had they come?

Now, the moment an illegal alien has entered the U.S., he likely senses that his ethnicity or race will be essential to his identity. In the minds of the ruling DEI commissariat, claiming a tribal identity offers an easy pathway to generous housing, food, healthcare, legal, and educational entitlements.

So, under Biden’s immigration non-policy, almost all illegal immigrants were immediately categorized as victims in the Marxist binary ledger that now divides America into the oppressed vs. the oppressors.

If one devised a plan to damage America, he could not have done better than further dividing us by tribal chauvinism, overwhelming our fragile social services so essential to struggling Americans, and fueling the already dangerous neo-Confederate state and local nullifications of federal law and the growth of “sanctuary cities.”

Daily, we witness performance-art mayors and governors boasting of how they “resist” federal law enforcement. These modern rebels pose as if they are our own era’s versions of mini-Confederate states. They now brag of states’ rights as they dare the federal government to protect its own property and enforce federal laws within their parochial jurisdictions.

Why did Biden—or whoever was making policy in his place—destroy the border?

What was his utterly mad intent?

To alter the nation’s demography by importing future Democrat constituents dependent on state largesse?

To bow to the demands of his DEI base?

To mindlessly do the opposite of the prior Trump administration, which had closed the border and returned to legal-only immigration?

Virtue signaling while waving illegal aliens across an open border is easy.

But trying to close the border and return millions who entered unlawfully to their homelands is nearly impossible.

It is surreal that those who claimed moral superiority while systemically destroying federal law now condemn as immoral those striving to restore it.

Tyler Durden Thu, 11/13/2025 - 20:05

The statistical agencies will post new schedules soon. It is possible that the October employment and CPI reports will never be released since the data wasn't gathered.

From the Census Bureau:

The U.S. Census Bureau is updating its economic indicator release calendar in coordination with other agencies and the Office of Management and Budget to address the impacts of the recent lapse in federal funding. We will provide the updated release schedule as soon as it becomes available.

Note: Mortgage rates are from MortgageNewsDaily.com and are for top tier scenarios.

Friday (red will NOT be released);
• At 8:30 AM ET, Retail sales for October.

• Also at 8:30 AM, The Producer Price Index for October from the BLS.

Underwater Mortgages Rise To 3-Year High Amid Cooling US Housing Market

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

A new report from the Intercontinental Exchange shows that nearly 875,000 homeowners now owe more on their mortgages than their properties are worth—the highest level in three years—as softening home prices and elevated borrowing costs squeeze household finances.

Townhouse for sale in Elkridge, Md., on Sept. 27, 2024. Madalina Vasiliu/The Epoch Times

The surge in negative equity represents 1.6 percent of all mortgage holders and highlights a worsening affordability landscape that officials in the Trump administration say is weighing on the broader economy.

While the jump is notable, the Intercontinental Exchange said in the Nov. 10 report, the overall share of underwater loans remains comparable to long-term averages prior to the pandemic housing boom, with the exception of the Great Recession. Still, the company warned that certain markets are seeing concentrated pockets of borrower vulnerability as prices continue to retreat from their post-COVID peaks.

“While overall negative equity rates remain low, certain markets are showing signs of concern, particularly in the Gulf Coast of Florida and Austin, Texas,” the report noted.

In Cape Coral, Florida, for example, where home prices are down 15 percent from their peak, 11 percent of mortgages are underwater, including more than one-third of those that originated between 2023 and 2024, when rates were highest.

The rise in negative equity is concentrated among recent, lower-down-payment borrowers, particularly those with Federal Housing Administration (FHA) and Veterans Affairs (VA) loans issued in 2023 and 2024.

In some VA cohorts, more than 20 percent of borrowers are now underwater, the Intercontinental Exchange said—a reflection of both local price declines and the fact that these newer borrowers never benefited from the pandemic-era equity cushions that protected earlier buyers.

Another 6.9 percent of mortgage holders have less than 10 percent equity remaining, the highest share since mid-2020. While the Intercontinental Exchange noted that the figure remains below long-term averages, low-equity borrowers are typically more vulnerable to credit stress if home prices continue to fall.

At the same time, the report struck a more positive tone on the outlook for refinancing and equity access as borrowing costs begin to ease.

The Intercontinental Exchange said falling mortgage rates have “significantly expanded” the number of homeowners who could lower their monthly payments, while also reducing the cost of tapping home equity.

“The recent easing in mortgage rates has begun to open the refinance window for many borrowers, particularly those who originated loans in the past two years,” Andy Walden, head of Mortgage and Housing Market Research at the Intercontinental Exchange, said in a statement.

The Intercontinental Exchange’s data show the number of highly qualified refinance candidates—those with strong credit, at least 20 percent equity, and potential savings of 75 basis points or more—rose to 1.7 million in late October, the largest since early 2022.

Including broader borrower profiles, approximately 4.1 million mortgage holders are currently “in the money” to refinance, a figure that could approach 5 million if rates drift slightly lower.

Housing in ‘Recession,’ Treasury Secretary Warns

The equity deterioration comes amid growing concern inside the Trump administration that high mortgage rates are dragging the housing sector into a downturn.

Treasury Secretary Scott Bessent said in a recent interview on CNN that parts of the economy “are in recession,” in particular housing, and that high borrowing costs are hitting low-income Americans the hardest.

“We have seen the biggest hindrance for housing here that are mortgage rates,” Bessent said. “So, if the Fed brings down mortgage rates, then they can end this housing recession.”

Bessent echoed warnings from Federal Reserve board member Stephen Miran, who told The New York Times in an earlier interview that keeping monetary policy “this tight for a long period of time” risks inducing a recession. Miran said he sees no reason for the central bank to delay further rate cuts with inflation cooling.

Borrowers Under Strain as Credit Stress Mounts

Beyond housing, other consumer-credit segments are flashing warning signs. Subprime auto-loan delinquencies hit 6.65 percent in October—the highest level on record since the early 1990s—according to Fitch Ratings. Two major auto-finance firms serving low-income borrowers filed for bankruptcy this fall.

Foreclosure activity is also creeping higher. More than 101,000 properties received filings in the third quarter, up 17 percent from a year earlier, according to ATTOM.

Mortgage delinquencies—while still low by historical standards—have also begun to rise from last year’s trough, according to data from VantageScore and the Federal Reserve Bank of New York.

Reuters and Naveen Athrapully contributed to this report.

Tyler Durden Thu, 11/13/2025 - 19:15

Pentagon Briefs Trump On 'Military Options' Against Venezuela For 'Coming Days'

Probably this wasn't the first time, but there is widespread reporting on Thursday that military options have been formally presented to President Trump by top Pentagon officials for operations against Venezuela, including including strikes on land. Reports say these options are for the "coming days".

Meetings at the White House are being held now that the USS Gerald Ford carrier strike group arrived in Caribbean waters days ago. The largest-ever 'peacetime' American military build-up off Venezuela is currently underway, with some 15,000 US troops total in the region.

Getty Images

"Secretary of War Pete Hegseth, Chairman of the Joint Chiefs of Staff Dan Caine and other senior officials briefed the president on military options for the coming days, the sources said," CBS reports. But it also stresses, "No final decision has been made, however, two of the sources told CBS News."

The development comes amid fresh reports of yet another alleged drug boat strike in the Caribbean Sea, bringing the total number of vessels destroyed to at least 22, which has killed some 80 or more suspected drug smugglers.

According to more via CBS:

The U.S. intelligence community assisted in providing information for potential operations, the sources said. Director of National Intelligence Tulsi Gabbard did not attend White House discussions because she was returning from an overseas trip. Secretary of State Marco Rubio was in Canada at a G7 summit of foreign ministers.

Previously, the Washington-based Center for Strategic & International Studies laid out why an entire carrier group in Caribbean waters represents a "use it or lose it" scenario which is ultra-costly, also in terms of removing it from other parts of the world:

Moving such a major element of U.S. combat power is highly significant because of the strategic trade-off it represents. The Navy has only 11 aircraft carriers. In general, only three are at sea at any one time because of the need for maintenance and training. All the regional commanders want them. U.S. Indo-Pacific Command always wants one—as a supplement to the carrier permanently stationed in Japan to counter the Chinese navy and conduct exercises with regional allies and partners.

Central Command wants one for the Indian Ocean for use against Iran and the Houthis or in the Eastern Mediterranean to provide air defense for Israel. European Command wants one for operations around Europe to deter Russia. By contrast, the Caribbean has been a low-visibility region for decades, with carriers rarely visiting.

Of course, all of this represents something likely much more than just a renewed 'war on drugs' - after Trump already said that potential land strikes against cartels in Venezuela are on the table.

María Corina Machado, the far-right US-backed Venezuelan coup leader who won the Nobel Peace Prize, promised a “massive privatization” if Trump can put her in power.

She vowed to sell off $1.7 TRILLION of Venezuela's oil, gas, gold, infrastructure, etc. to US corporations. pic.twitter.com/jH4AkFbzzk

— Ben Norton (@BenjaminNorton) November 13, 2025

At various times over the last months, Trump officials have strongly hinted at pursuing regime change against socialist strongman Nicolás Maduro in Venezuela - which is also consistent with the stance of Trump's first term.

Tyler Durden Thu, 11/13/2025 - 18:25

Pentagon Briefs Trump On 'Military Options' Against Venezuela For 'Coming Days'

Probably this wasn't the first time, but there is widespread reporting on Thursday that military options have been formally presented to President Trump by top Pentagon officials for operations against Venezuela, including including strikes on land. Reports say these options are for the "coming days".

Meetings at the White House are being held now that the USS Gerald Ford carrier strike group arrived in Caribbean waters days ago. The largest-ever 'peacetime' American military build-up off Venezuela is currently underway, with some 15,000 US troops total in the region.

Getty Images

"Secretary of War Pete Hegseth, Chairman of the Joint Chiefs of Staff Dan Caine and other senior officials briefed the president on military options for the coming days, the sources said," CBS reports. But it also stresses, "No final decision has been made, however, two of the sources told CBS News."

The development comes amid fresh reports of yet another alleged drug boat strike in the Caribbean Sea, bringing the total number of vessels destroyed to at least 22, which has killed some 80 or more suspected drug smugglers.

According to more via CBS:

The U.S. intelligence community assisted in providing information for potential operations, the sources said. Director of National Intelligence Tulsi Gabbard did not attend White House discussions because she was returning from an overseas trip. Secretary of State Marco Rubio was in Canada at a G7 summit of foreign ministers.

Previously, the Washington-based Center for Strategic & International Studies laid out why an entire carrier group in Caribbean waters represents a "use it or lose it" scenario which is ultra-costly, also in terms of removing it from other parts of the world:

Moving such a major element of U.S. combat power is highly significant because of the strategic trade-off it represents. The Navy has only 11 aircraft carriers. In general, only three are at sea at any one time because of the need for maintenance and training. All the regional commanders want them. U.S. Indo-Pacific Command always wants one—as a supplement to the carrier permanently stationed in Japan to counter the Chinese navy and conduct exercises with regional allies and partners.

Central Command wants one for the Indian Ocean for use against Iran and the Houthis or in the Eastern Mediterranean to provide air defense for Israel. European Command wants one for operations around Europe to deter Russia. By contrast, the Caribbean has been a low-visibility region for decades, with carriers rarely visiting.

Of course, all of this represents something likely much more than just a renewed 'war on drugs' - after Trump already said that potential land strikes against cartels in Venezuela are on the table.

María Corina Machado, the far-right US-backed Venezuelan coup leader who won the Nobel Peace Prize, promised a “massive privatization” if Trump can put her in power.

She vowed to sell off $1.7 TRILLION of Venezuela's oil, gas, gold, infrastructure, etc. to US corporations. pic.twitter.com/jH4AkFbzzk

— Ben Norton (@BenjaminNorton) November 13, 2025

At various times over the last months, Trump officials have strongly hinted at pursuing regime change against socialist strongman Nicolás Maduro in Venezuela - which is also consistent with the stance of Trump's first term.

Tyler Durden Thu, 11/13/2025 - 18:25

How China Grabbed Nvidia Racks Through Secret Jakarta Loophole

While President Trump reiterated earlier this month that he doesn't want China getting its hands on Nvidia's most advanced AI chips, a Chinese AI company has found a convenient loophole: Indonesia. 

An investigation by the Wall Street Journal reveals that around 2,300 of said chips have been procured by said Chinese AI company - and has traced how "a chain of deals across several countries got the chips inside the data center, which is wedged between a private school and an upscale apartment complex. A company that arranged the transaction is a subsidiary of a Chinese business on an American trade blacklist."

And the kicker: none of it appears to have violated US law.

China has notably been barred from buying advanced US semiconductors since 2022 over national-security concerns. And while Nvidia CEO Jensen Huang insists that Nvidia's market share in China has 'fallen to zero' from 95% due to the US export restrictions - which is clearly not the case. 

Some bring the chips physically into China using middlemen. Another increasingly popular workaround, which has been employed in Australia and Malaysia, is renting computing power abroad and bringing data out of China and back—sometimes by packing suitcases with hard drives, the Journal has previously reported.

In the Indonesia case, the Journal was able to trace the chips from start to finish, including the specific entities involved. American technology is being made available to a Chinese company through these four steps. -WSJ

Here's how it works: 

1. Nvidia sells chips to a U.S. partner partly owned by a Chinese firm

   Nvidia supplies advanced AI chips to Aivres, a Silicon Valley server builder whose parent company is one-third owned by Inspur—a Chinese tech firm placed on a U.S. national-security blacklist in 2023. While Nvidia is barred from dealing with Inspur or its blacklisted subsidiaries, the restrictions don’t extend to U.S.-based entities like Aivres, allowing the business relationship to continue.

2. Aivres finds an overseas buyer for high-end Nvidia servers

   In mid-2024, Aivres negotiated a $100 million deal to sell 32 Nvidia GB200 server racks - containing roughly 2,300 Blackwell-generation chips - to Indosat Ooredoo Hutchison’s cloud-computing division in Indonesia. Indosat is jointly owned by Qatar’s Ooredoo and Hong Kong’s CK Hutchison.

3. The Indonesian buyer lines up a Chinese AI startup as the end user

   Indosat agreed to purchase the servers only after securing a major client facilitated by Aivres: Shanghai-based AI startup INF Tech. Negotiations also included representatives from Fudan University, where INF’s founder, Qi Yuan, directs an AI institute.

4. The Chinese startup intends to use the chips for finance and medical AI

   By October, the servers had arrived in Indonesia and were being set up. INF plans to use the computing power to train AI models for financial analytics and scientific research, including drug-discovery applications.

According to attorneys familiar with export-control rules, as long as the Chinese company isn't directly using the chips to help China with military intelligence or weapons of mass destruction, the arrangement doesn't violate any laws set by the Trump administration. 

Interestingly, the Journal reports that in the waning days of the Biden Autopen administration, a rule was created that would have tightened controls over the sale of advanced US chips to countries such as Indonesia that aren't in a small group of US allies - yet, the Trump administration later said it wouldn't enforce the rule, which would have given the US a chance to scrutinize the customer's intentions, along with the exporter - particularly if they were on a national-security trade blacklist known as the "entity list." 

One way or another, China gets their racks. (h/t Capital.news)

Tyler Durden Thu, 11/13/2025 - 18:00

How China Grabbed Nvidia Racks Through Secret Jakarta Loophole

While President Trump reiterated earlier this month that he doesn't want China getting its hands on Nvidia's most advanced AI chips, a Chinese AI company has found a convenient loophole: Indonesia. 

An investigation by the Wall Street Journal reveals that around 2,300 of said chips have been procured by said Chinese AI company - and has traced how "a chain of deals across several countries got the chips inside the data center, which is wedged between a private school and an upscale apartment complex. A company that arranged the transaction is a subsidiary of a Chinese business on an American trade blacklist."

And the kicker: none of it appears to have violated US law.

China has notably been barred from buying advanced US semiconductors since 2022 over national-security concerns. And while Nvidia CEO Jensen Huang insists that Nvidia's market share in China has 'fallen to zero' from 95% due to the US export restrictions - which is clearly not the case. 

Some bring the chips physically into China using middlemen. Another increasingly popular workaround, which has been employed in Australia and Malaysia, is renting computing power abroad and bringing data out of China and back—sometimes by packing suitcases with hard drives, the Journal has previously reported.

In the Indonesia case, the Journal was able to trace the chips from start to finish, including the specific entities involved. American technology is being made available to a Chinese company through these four steps. -WSJ

Here's how it works: 

1. Nvidia sells chips to a U.S. partner partly owned by a Chinese firm

   Nvidia supplies advanced AI chips to Aivres, a Silicon Valley server builder whose parent company is one-third owned by Inspur—a Chinese tech firm placed on a U.S. national-security blacklist in 2023. While Nvidia is barred from dealing with Inspur or its blacklisted subsidiaries, the restrictions don’t extend to U.S.-based entities like Aivres, allowing the business relationship to continue.

2. Aivres finds an overseas buyer for high-end Nvidia servers

   In mid-2024, Aivres negotiated a $100 million deal to sell 32 Nvidia GB200 server racks - containing roughly 2,300 Blackwell-generation chips - to Indosat Ooredoo Hutchison’s cloud-computing division in Indonesia. Indosat is jointly owned by Qatar’s Ooredoo and Hong Kong’s CK Hutchison.

3. The Indonesian buyer lines up a Chinese AI startup as the end user

   Indosat agreed to purchase the servers only after securing a major client facilitated by Aivres: Shanghai-based AI startup INF Tech. Negotiations also included representatives from Fudan University, where INF’s founder, Qi Yuan, directs an AI institute.

4. The Chinese startup intends to use the chips for finance and medical AI

   By October, the servers had arrived in Indonesia and were being set up. INF plans to use the computing power to train AI models for financial analytics and scientific research, including drug-discovery applications.

According to attorneys familiar with export-control rules, as long as the Chinese company isn't directly using the chips to help China with military intelligence or weapons of mass destruction, the arrangement doesn't violate any laws set by the Trump administration. 

Interestingly, the Journal reports that in the waning days of the Biden Autopen administration, a rule was created that would have tightened controls over the sale of advanced US chips to countries such as Indonesia that aren't in a small group of US allies - yet, the Trump administration later said it wouldn't enforce the rule, which would have given the US a chance to scrutinize the customer's intentions, along with the exporter - particularly if they were on a national-security trade blacklist known as the "entity list." 

One way or another, China gets their racks. (h/t Capital.news)

Tyler Durden Thu, 11/13/2025 - 18:00

Last US Penny Minted Shows Why Savers Need Bitcoin

Authored by Vince Quill via CoinTelegraph.com,

The last penny, nominally valued at $0.01, was minted by the United States Mint in Philadelphia, Pennsylvania, on Wednesday, marking the end of 232 years of new pennies being coined and circulated.

US President Donald Trump directed the US Treasury to stop producing pennies in February, and the Treasury initially set a 2026 target for the last mint. However, the Treasury exhausted the templates used to manufacture the coins between June and September, according to Axios.

A penny costs about 3.7 times its face value to manufacture, meaning that each $0.01 coin actually costs over $0.03.

While it is no longer economically feasible to mint more US pennies, the coin will remain as legal tender, with the more than 250 billion physical pennies continuing to circulate.

“Inflation made the penny useless. Meanwhile, it's making the sat more relevant every year,” Alexander Leishman, CEO of Bitcoin financial services company River, said, referring to the subunit of one Bitcoin.

Bitcoin as a solution to the erosion of fiat money’s value

Bitcoin was created as an alternative monetary system that has a supply cap of 21 million coins, meaning that as demand for BTC increases, so should the price per coin.

Technological development is a deflationary force that makes the production process more efficient and reduces the price of goods and services over time, according to author, economist and BTC advocate Saifedean Ammous.

Fiat currencies, in contrast, fail to capture this price deflation because their supply is constantly increasing, resulting in reduced purchasing power over time, which is reflected in the higher prices of goods, assets and services.

In other words, the price of goods and services is not increasing; the value of fiat currencies is declining relative to goods, services and hard assets, according to Ammous.

If those same goods, services, and assets were denominated in BTC or some other hard money standard, prices would go down over time, the economist argues.

Median home prices measured in BTC showcase how a supply-capped hard money benefits the holder through depreciating prices of goods, services and assets. Source: Priced In Bitcoin

The US dollar has lost over 92% of its value since the creation of the Federal Reserve Banking System in 1913, according to precious metals dealer The Gold Bureau.

Meanwhile, Bitcoin hit all-time highs above $126,000 in October, as the US dollar was on track for its worst year since 1973, according to market analysts at The Kobeissi Letter.

“The USD has lost about 40% of its purchasing power since 2000,” The Kobeissi Letter said in October, adding that it lost over 10% of its value year-to-date as of October.

Source: Anthony Pompliano

However, economist Paul Krugman, who has long been critical of cryptocurrencies and BTC, said the dollar’s power rests in how easy it is to use, compared to BTC, which is difficult for the average person to hold and transact with.

“The whole point about the dollar is it’s really easy to use, and Bitcoin is not easy to use,” Krugman told podcast host Hasan Minhaj.

Tyler Durden Thu, 11/13/2025 - 17:40

Last US Penny Minted Shows Why Savers Need Bitcoin

Authored by Vince Quill via CoinTelegraph.com,

The last penny, nominally valued at $0.01, was minted by the United States Mint in Philadelphia, Pennsylvania, on Wednesday, marking the end of 232 years of new pennies being coined and circulated.

US President Donald Trump directed the US Treasury to stop producing pennies in February, and the Treasury initially set a 2026 target for the last mint. However, the Treasury exhausted the templates used to manufacture the coins between June and September, according to Axios.

A penny costs about 3.7 times its face value to manufacture, meaning that each $0.01 coin actually costs over $0.03.

While it is no longer economically feasible to mint more US pennies, the coin will remain as legal tender, with the more than 250 billion physical pennies continuing to circulate.

“Inflation made the penny useless. Meanwhile, it's making the sat more relevant every year,” Alexander Leishman, CEO of Bitcoin financial services company River, said, referring to the subunit of one Bitcoin.

Bitcoin as a solution to the erosion of fiat money’s value

Bitcoin was created as an alternative monetary system that has a supply cap of 21 million coins, meaning that as demand for BTC increases, so should the price per coin.

Technological development is a deflationary force that makes the production process more efficient and reduces the price of goods and services over time, according to author, economist and BTC advocate Saifedean Ammous.

Fiat currencies, in contrast, fail to capture this price deflation because their supply is constantly increasing, resulting in reduced purchasing power over time, which is reflected in the higher prices of goods, assets and services.

In other words, the price of goods and services is not increasing; the value of fiat currencies is declining relative to goods, services and hard assets, according to Ammous.

If those same goods, services, and assets were denominated in BTC or some other hard money standard, prices would go down over time, the economist argues.

Median home prices measured in BTC showcase how a supply-capped hard money benefits the holder through depreciating prices of goods, services and assets. Source: Priced In Bitcoin

The US dollar has lost over 92% of its value since the creation of the Federal Reserve Banking System in 1913, according to precious metals dealer The Gold Bureau.

Meanwhile, Bitcoin hit all-time highs above $126,000 in October, as the US dollar was on track for its worst year since 1973, according to market analysts at The Kobeissi Letter.

“The USD has lost about 40% of its purchasing power since 2000,” The Kobeissi Letter said in October, adding that it lost over 10% of its value year-to-date as of October.

Source: Anthony Pompliano

However, economist Paul Krugman, who has long been critical of cryptocurrencies and BTC, said the dollar’s power rests in how easy it is to use, compared to BTC, which is difficult for the average person to hold and transact with.

“The whole point about the dollar is it’s really easy to use, and Bitcoin is not easy to use,” Krugman told podcast host Hasan Minhaj.

Tyler Durden Thu, 11/13/2025 - 17:40

Swalwell Bares Fangs After Pulte Refers To DOJ For Criminal Mortgage Fraud

Rep. Eric Swalwell (D-CA) is super pissed after Federal Housing Finance Agency (FHFA) Director Bill Pulte referred him to the DOJ for criminal prosecution over alleged mortgage fraud.

Eric Swalwell and alleged Chinese spy, Christine Fang

On Thursday, Swalwell lashed out, saying in a statement "As the most vocal critic of Donald Trump over the last decade and as the only person who still has a surviving lawsuit against him, the only thing I am surprised about is that it took him this long to come after me," adding "Like James Comey and John Bolton, Adam Schiff and Lisa Cook, Letitia James and the dozens more to come — I refuse to live in fear in what was once the freest country in the world."

The accusations against Swalwell are connected to a DC property, according to CBS News. 

Hilariously, Democrats and their media lapdogs are SHOCKED that Trump, who they went after hammer and tong for a decade, would investigate their actual (alleged!) crimes and go after them. 

Pulte, has leveled similar accusations against several other officials, including Democrats New York Attorney General Letitia James and California Sen. Adam Schiff, and Federal Reserve Governor Lisa Cook. 

James was indicted on one count of bank fraud and one count of making false statements to a financial institution last month and pleaded not guilty. President Trump moved to fire Cook in August after Pulte accused her of making misrepresentations on mortgage documents. But Cook filed a lawsuit arguing her removal was unlawful, and the Supreme Court will hear arguments in January on whether Mr. Trump can fire her from the Federal Reserve Board of Governors. -CBS News

In September, Swalwell said that he "fully" expects to be prosecuted by the Trump administration - while also confronting FBI Director Kash Patel during a congressional appearance that same month, noting that Patel had referred to him as a "government gangster." 

"You identified 60 individuals in that book. You put me on that list at the top of the list," Swalwell said, adding "Thank you. My children find it flattering... Twenty of those individuals have been investigated or have had adverse actions." As part of his statement, Swalwell told President Trump to "do better. Be better." 

And then he got tricked into banging another Chinese spy (kidding!).

Tyler Durden Thu, 11/13/2025 - 17:20

Swalwell Bares Fangs After Pulte Refers To DOJ For Criminal Mortgage Fraud

Rep. Eric Swalwell (D-CA) is super pissed after Federal Housing Finance Agency (FHFA) Director Bill Pulte referred him to the DOJ for criminal prosecution over alleged mortgage fraud.

Eric Swalwell and alleged Chinese spy, Christine Fang

On Thursday, Swalwell lashed out, saying in a statement "As the most vocal critic of Donald Trump over the last decade and as the only person who still has a surviving lawsuit against him, the only thing I am surprised about is that it took him this long to come after me," adding "Like James Comey and John Bolton, Adam Schiff and Lisa Cook, Letitia James and the dozens more to come — I refuse to live in fear in what was once the freest country in the world."

The accusations against Swalwell are connected to a DC property, according to CBS News. 

Hilariously, Democrats and their media lapdogs are SHOCKED that Trump, who they went after hammer and tong for a decade, would investigate their actual (alleged!) crimes and go after them. 

Pulte, has leveled similar accusations against several other officials, including Democrats New York Attorney General Letitia James and California Sen. Adam Schiff, and Federal Reserve Governor Lisa Cook. 

James was indicted on one count of bank fraud and one count of making false statements to a financial institution last month and pleaded not guilty. President Trump moved to fire Cook in August after Pulte accused her of making misrepresentations on mortgage documents. But Cook filed a lawsuit arguing her removal was unlawful, and the Supreme Court will hear arguments in January on whether Mr. Trump can fire her from the Federal Reserve Board of Governors. -CBS News

In September, Swalwell said that he "fully" expects to be prosecuted by the Trump administration - while also confronting FBI Director Kash Patel during a congressional appearance that same month, noting that Patel had referred to him as a "government gangster." 

"You identified 60 individuals in that book. You put me on that list at the top of the list," Swalwell said, adding "Thank you. My children find it flattering... Twenty of those individuals have been investigated or have had adverse actions." As part of his statement, Swalwell told President Trump to "do better. Be better." 

And then he got tricked into banging another Chinese spy (kidding!).

Tyler Durden Thu, 11/13/2025 - 17:20

Kim Kardashian's Brand Skims Now Valued At $5 Billion After Goldman-Led Funding Round

Kim Kardashian's brand Skims has closed a major new funding round, raising $225 million at a $5 billion valuation, per Lauren Hirsch. The Goldman Sachs Alternatives–led round, with BDT & MSD Partners participating, underscores how far the brand has grown beyond its shapewear origins, according to DealBook.

Founded in 2019 by Kim Kardashian and Jens Grede, Skims is profitable and expects to top $1 billion in net sales this year. Its last round in 2023 valued it at $4 billion.

The company plans to use the new capital to expand its retail footprint. Skims has 18 stores across U.S. cities like New York, Los Angeles, Austin, Atlanta and Boca Raton, and aims to grow internationally, especially in emerging markets. Kardashian said the raise “validates the hard work of our incredible team and partners … becoming a global omnichannel retail brand.”

Photograph for story context purposes only

DealBook writes that the brand is also pushing into new categories, including the high-profile NikeSkims collaboration announced in February, with apparel now and footwear and accessories planned. Skims remains the official underwear partner of the W.N.B.A., N.B.A. and USA Basketball.

Skims is building out beauty, having repurchased the 20 percent stake previously sold to Coty and hiring Ami Colé founder Diarrha N’Diaye to lead the effort. A recent hint came via the $48 Seamless Sculpt Face Wrap that uses its “signature sculpting fabric.”

New investors include Goldman Sachs Alternatives and BDT & MSD Partners, joining Wellington Management, Greenoaks, D1 Capital, Imaginary Ventures and Thrive Capital. Goldman’s Beat Cabiallavetta said Skims excels at “pioneering new categories and redefining everyday wear.”

As for an I.P.O., speculation continues, but Grede recently downplayed near-term plans, saying, “We might make that position in the future, but that’s not what I’m thinking about.”

This one too Tyler Durden Thu, 11/13/2025 - 16:40

Who Really Owns America? The Banks, The Billionaires, & The Deep State

Authored by John and Nisha Whitehead via The Rutherford Institute,

“The politicians are put there to give you the idea that you have freedom of choice. You don’t. You have no choice. You have owners. They own you. They own everything. They own all the important land. They own and control the corporations. They’ve long since bought and paid for the Senate, the Congress, the state houses, the city halls. They got the judges in their back pockets and they own all the big media companies, so they control just about all of the news and information you get to hear… They spend billions of dollars every year lobbying. Lobbying to get what they want. Well, we know what they want. They want more for themselves and less for everybody else... It’s called the American Dream, ‘cause you have to be asleep to believe it.”

- George Carlin

As President Trump floats the idea of 50-year mortgages, Americans are being sold a new version of the American Dream—one that can never truly be owned, only leased from the banks, billionaires, and private equity landlords who profit from our permanent state of debt.

Which begs the question: who owns America?

Is it the government? The politicians? The corporations? The foreign investors? The American people?

While the Deep State keeps the nation divided and distracted by circus politics—the bread and circuses of empire—the police state’s stranglehold on power ensures the continuation of endless wars, runaway spending, and disregard for the rule of law.

Meanwhile, America is literally being bought and sold right out from under us.

Consider the facts.

Homeownership—the cornerstone of middle-class stability—is being transformed into a lifetime rental agreement. Cars, homes, and even college degrees have become indentured commodities in a debt-driven economy where the average American family serves as collateral for Wall Street’s profits.

This is not accidental.

It’s the natural evolution of an economy built to enrich the few at the expense of the many.

The American Dream has been repackaged as a subscription service—an illusion of ownership propped up by 0% down payments, predatory interest rates, and fine print that lasts a lifetime.

What used to be called “buying” is now simply renting from the future.

We’re losing more and more of our land every year to corporations and foreign interests. As individual Americans struggle just to make rent, corporations and foreign investors are quietly buying the country piece by piece. Foreign ownership of U.S. agricultural land has surged to more than 43 million acres—millions added in just the last few years. Meanwhile, large institutional landlords and single-family rental operators have amassed hundreds of thousands of houses across the country. Corporations now hold vast portfolios, converting would-be first-time buyers into permanent tenants. The result is a nation where more of our soil and shelter are controlled by entities whose primary allegiance is to shareholders—not communities.

The same dynamic plays out across industries.

We’re losing more and more of our businesses every year to foreign corporations and interests. Brands that once defined American enterprise—U.S. Steel, Budweiser, Jeep and Chrysler, Burger King, 7-Eleven—now fly international flags. Chinese companies and investors are also buying up major food companies, commercial and residential real estate, and other businesses. Global conglomerates have bought up the names we grew up with: U.S. Steel (now Japanese-owned); General Electric (Chinese-owned); Budweiser (Belgium); Burger King (Canada); 7-Eleven (Japan); Jeep, Chrysler, and Dodge (Netherlands); and IBM (China). The American economy has become a franchise of the world’s oligarchs.

We’re digging ourselves deeper and deeper into debt, both as a nation and as a populace. Debt has become America’s most profitable export. Washington borrows trillions it cannot repay; Wall Street packages our futures into products it can sell; and households shoulder record balances. The national debt (the amount the federal government has borrowed over the years and must pay back) has surged to more than $38 trillion under President Trump, “the fastest accumulation of a trillion dollars in debt outside of the COVID-19 pandemic.” In a nutshell, the U.S. government is funding its existence with a credit card, spending money it doesn’t have on programs it can’t afford. In this economy, debt has replaced freedom as our national currency.

The Fourth Estate—the supposed watchdog of power—has largely merged with the corporate state. Independent news agencies, which were supposed to act as bulwarks against government propaganda, have been subsumed by a global corporate takeover of newspapers, television and radio. A handful of corporations now control most of the media industry and, thus, the information dished out to the public. Likewise, with Facebook and Google having appointed themselves the arbiters of disinformation, we now find ourselves grappling with new levels of corporate censorship by entities with a history of colluding with the government to keep the citizenry mindless, muzzled and in the dark.

Most critically of all, however, the U.S. government, long ago sold to the highest bidders, now operates as a shell company for corporate interests. Nowhere is this state of affairs more evident than in the manufactured spectacle that is politics. Elections change the faces, not the system. Members of Congress do far more listening to donors than to citizens, so much so that they spend two-thirds of their time in office raising money. As Reuters reports, “It also means that lawmakers often spend more time listening to the concerns of the wealthy than anyone else.”

In the oligarchy that is the American police state, it clearly doesn’t matter who wins the White House, if they all answer to the same corporate shareholders.

So much for living the American dream.

“We the people” have become the new, permanent underclass in America.

We’re being forced to shell out money for endless wars that are bleeding us dry; money for surveillance systems to track our movements; money to further militarize our already militarized police; money to allow the government to raid our homes and bank accounts; money to fund schools where our kids learn nothing about freedom and everything about how to comply; and on and on.

This is no way of life.

It’s tempting to say that there’s little we can do about it, except that’s not quite accurate.

There are a few things we can do—demand transparency, reject cronyism and graft, insist on fair pricing and honest accounting methods, call a halt to incentive-driven government programs that prioritize profits over people—but it will require that “we the people” stop playing politics and stand united against the politicians and corporate interests who have turned our government and economy into a pay-to-play exercise in fascism.

Unfortunately, we’ve become so invested in identity politics that label us based on our political leanings that we’ve lost sight of the one label that unites us: we’re all Americans.

The powers-that-be want us to adopt an “us versus them” mindset that keeps us powerless and divided. Yet as I make clear in my book Battlefield America: The War on the American People and in its fictional counterpart The Erik Blair Diaries, the only “us versus them” that matters is “we the people” against the Deep State.

The American Dream was meant to promise opportunity, not indentured servitude.

Yet in the American Police State, freedom itself is on loan—with interest.

We can keep renting our lives from the powerful few who profit from our compliance, or we can reclaim true ownership—of our persons, our labor, our government, and our future.

For as long as we still have one, the choice is ours.

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

Tyler Durden Thu, 11/13/2025 - 16:20

First Casualty Of Power Bill Crisis? Pennsylvania Abandons Regional Carbon-Trading Market

The worsening power bill crisis across the Mid-Atlantic region, a combination of nation-killing climate change policies colliding with surging load growth from data centers, has forced Pennsylvania Governor Josh Shapiro to sign legislation allowing the state to abandon the Regional Greenhouse Gas Initiative (RGGI).

The Pennsylvania legislature ended the state's RGGI participation in the new state budget, which also cut funding tied to the climate initiative, effectively reversing the state's 2019 entry under former Governor Tom Wolf.

Senate Republicans have opposed RGGI for years, which, through its carbon-pricing structure, effectively penalizes the state's energy sector, increasing costs for the very plants that anchor the state's power grid and industrial economy. In return, power plants pay for CO₂ allowances that only send wholesale electricity prices higher, and result in higher power bills for businesses and families.

It's straightforward: climate taxes = higher power bills. 

Independent reports (from grid operator PJM and state regulators) have warned RGGI would:

• pressure to close gas and coal plants early

• loss of grid resilience

• higher risk of capacity shortages

Given surging load growth from data centers, RGGI was a disaster waiting to happen that would've stripped the grid of spare capacity, destabilized regional power supply, and effectively paralyzed the state into a power crisis, as its neighbors just south, in Maryland, have done through failed globalist climate crisis policies.

"For years, the Republicans who've led the Senate have used RGGI as an excuse to stall substantive conversations about energy production; today that excuse is gone," Shapiro told reporters during a press conference minutes before signing the budget.

Shapiro noted, "I am looking forward to aggressively pushing for policies that create more jobs in the energy sector, bring more clean energy onto our grid and reduce the cost of energy for all Pennsylvanians."

The question becomes whether other surrounding states, many of which are experiencing power bill crises, thanks to horrible green policies that strip stable spare capacity from grids and replace it with unreliable solar and wind, which collide with expanding load growth from data centers, quietly exit RGGI.

It's time to bring common sense back to Mid-Atlantic politics after decades of failed Democratic policies that have sparked a cost-of-living crisis. And for those leftist-controlled states still pushing the climate-crisis narrative, remember this: even Bill Gates has acknowledged that many of the extreme claims around climate policy have been overstated.

By the way, the whole climate crisis hoax delayed America's ability to add new reliable spare capacity on the grid - now it must play catch up (all detailed in this epic report).

Tyler Durden Thu, 11/13/2025 - 15:40

ChatGPT's Use Of Song Lyrics Violates Copyright, Munich Court Finds

Authored by Vince Dioquino via Decrypt.co,

• Judges found GEMA’s claims valid, ordering OpenAI to cease reproduction and provide damages and disclosure.

• The court said GPT-4 and GPT-4o “memorized” lyrics, amounting to reproduction under EU copyright rules.

• The decision, not yet final, could set a major European precedent on AI training data.

Germany’s national music rights organization secured a partial but decisive win against OpenAI after a Munich court ruled that ChatGPT’s underlying models unlawfully reproduced copyrighted German song lyrics.

The ruling orders OpenAI to cease reproduction, disclose relevant training details, and compensate rights holders.

It is not yet final, and OpenAI may appeal.

If upheld, the decision could reshape how AI companies source and license creative material in Europe, as regulators weigh broader obligations for model transparency and training-data provenance.

The case marks the first time a European court has found that a large language model violated copyright by memorizing protected works.

In its decision, the 42nd Civil Chamber of the Munich I Regional Court said that GPT-4 and GPT-4o contained “reproducible” lyrics from nine well-known songs, including Kristina Bach’s “Atemlos” and Rolf Zuckowski’s “Wie schön, dass du geboren bist.”

The court held that such memorization constitutes a “fixation” of the original works in the model’s parameters, satisfying the legal definition of reproduction under Article 2 of the EU InfoSoc Directive and Germany’s Copyright Act.

“At least in individual cases, when prompted accordingly, the model produces an output whose content is at least partially identical to content from the earlier training dataset,” a translated copy of the written judgement provided by the Munich court to Decrypt reads.

The model “generates a sequence of tokens that appears statistically plausible because, for example, it was contained in the training process in a particularly stable or frequently recurring form,” the court wrote, adding that because this “token sequence appeared on a large number of publicly accessible websites“ it meant that it was “included in the training dataset more than once."

In the pleadings, GEMA argued that the model's output lyrics were almost verbatim when prompted, proving that OpenAI’s systems had retained and reproduced the works.

OpenAI countered that its models do not store training data directly and that any output results from user prompts, not from deliberate copying.

The company also invoked text-and-data-mining exceptions, which allow temporary reproductions for analytical use.

“We disagree with the ruling and are considering next steps,” a spokesperson for OpenAI told Decrypt. “The decision is for a limited set of lyrics and does not impact the millions of people, businesses, and developers in Germany that use our technology every day.” 

OpenAI claims systems like theirs do not store or contain training data and thus do not hold copies of lyrics or other texts. Instead, these models learn patterns and generate new outputs based on patterns, OpenAI said.

The company told Decrypt that treating a model as if it contains stored works reflects a misunderstanding of how the technology works.

The court rejected those defenses, ruling that full reproductions embedded in a model’s structure fall outside the scope of data-mining exemptions.

“Training the models is not to be regarded as a usual and expected form of use that the rights holder must anticipate,” the court wrote. “This applies all the more when—as in the present case—the works are reproduced in the model, something that even the defendants themselves consider undesirable and against which countermeasures are taken.”

Decrypt reached out separately to GEMA for comment but has yet to receive a response by press time.

Tyler Durden Thu, 11/13/2025 - 15:20

 

 

Fees are going higher.

There has been a lot of coverage about this, especially with high-end credit cards like the Chase Sapphire Reserve and the Amex Platinum. Some of this is inflation, some business model adjustments, some just platform decay (aka enshittification).

Nobody really needs a points card, but if you use it well, it might be worth the cost.

I discussed a contrarian reason why pre-pandemic:

“Spending points provide any consumer with an opportunity to act as irrationally or even irresponsibly as they like, without the fear of negative consequences. (Spending recklessly on credit cards to accumulate points is idiotic; that is not what we are discussing here). I also am deeply aware of the advantages of purchasing experiences as opposed to the usual materialistic consumer stuff.

I see it not as a loss of 1%, an amount I do not imagine I was likely to have noticed either way. Instead, it is an unexpected windfall, providing an excuse to do some things and make some purchases you might not have done on your own, but wanted to.”

My choice is irrational. I intellectually understand that all cash is fungible, and that dollars back are both more flexible and more efficient than any points plan. I freely admit this. But it creates the opportunity to purchase guilt-free things I would not otherwise buy with my own money.

In 2018, I mentioned a ~$1000 Weber Grill (ironically, it reveals the impact of inflation that in 2018, that amount seemed silly for a grill). A $300 Dyson whisper fan for my desk that I would never have spent the money on; prior to that, an unusually generous points program at Restoration Hardware led to a new bedroom set.

Since then, I have purchased not one but two ridiculous Breville Espresso Machines with points: The Breville Barista Touch Impress Espresso Machine Brass Collection ($1700 at Williams Sonoma) and a Breville Oracle Touch Espresso Machine BES990BSS, Brushed Stainless Steel ($2500 at Amazon). Either of these machines purchased with real money would have ended in divorce, something you definitely cannot pay for with points.

 

The Math remains the same: Cash Back is rational, but Points can be used as an  irrational behavioral hack…

 

 

 

Previously:
Adventures in Behavioral Finance, Points Edition (May 17, 2018)

 

See also:
How much in cash back/points makes a credit card worthwhile for you?  (reddit)

The Problem With Rewards Credit Cards (The Atlantic, July 24, 2025)

Money anxiety is basically a part-time job now (Axios, Jul 30, 2025)

 

The post Points or Cash Back? appeared first on The Big Picture.