Individual Economists

NAR: Pending Home Sales Increase 1.8% in May; Up 1.1% YoY

Calculated Risk -

From the NAR: NAR Pending Home Sales Report Reveals 1.8% Increase in May
Pending home sales increased by 1.8% in May from the prior month and 1.1% year-over-year, according to the National Association of REALTORS® Pending Home Sales report. All four U.S. regions experienced month-over-month increases – most notably the West. Year-over-year, contract signings rose in the Midwest and South, while they fell in the Northeast and West.

Northeast
2.1% month-over-month increase.
0.5% year-over-year decrease.

Midwest
0.3% month-over-month increase.
2.6% year-over-year increase.

South
1.0% month-over-month increase.
2.0% year-over-year increase.

West
6.0% month-over-month increase.
1.2% year-over-year decrease.
emphasis added
Note: Contract signings usually lead sales by about 45 to 60 days, so this would usually be for closed sales in June and July.

Trump Plans Mass Dismissal Of Asylum Claims, Fast-Track Deportations

Zero Hedge -

Trump Plans Mass Dismissal Of Asylum Claims, Fast-Track Deportations

The Trump administration is preparing to dismiss asylum claims for potentially hundreds of thousands of migrants—primarily those who crossed the southern or northern borders illegally and later applied for protection—according to CNN, citing two sources. Once dismissed, these migrants would become immediately deportable under fast-track removal procedures, bypassing immigration court.

Migrants who entered the U.S. unlawfully and sought asylum through U.S. Citizenship and Immigration Services (USCIS) would be impacted if the new policy goes into effect. This could result in up to 250,000 migrants—out of the 1.45 million pending asylum cases—being slated for removal.

Here's more from the report:

The people being targeted in this case are those who entered the U.S. unlawfully and later applied for asylum, the sources said. Their cases are expected to be closed, therefore leaving them at risk of deportation. It could affect hundreds of thousands of asylum applicants.

According to a memo obtained by CNN, USCIS, which falls under the control of Homeland Security Secretary Kristi Noem, will place those migrants in fast-track deportation proceedings as well as "take additional actions to enforce civil and criminal violations of the immigration laws."

USCIS spokesperson Matthew Tragesser told the outlet that no agency changes have been "announced at this time," adding that its "top priority remains the screening and vetting of all aliens seeking to come, live, or work in the United States. President Trump and Secretary Noem have given USCIS the ability to use all tools in our toolbox to ensure that the integrity of the immigration system is upheld, fraud is uncovered and expeditiously addressed, and illegal aliens are removed from the country."

Earlier this month, President Trump directed Immigration and Customs Enforcement to ramp up operations in chaotic sanctuary cities run by far-left politicians working with dark money-funded NGOs to shield criminal illegal aliens from deportations. In one extreme case, a Los Angeles official reportedly called for Mexican gangs to mobilize against ICE agents.

Meanwhile, the Democratic Party's nominee for New York City mayor, 33-year-old Marxist Zohran Mamdani, is campaigning on a platform of free stuff paid for by the government (taxpayers)—even promoting his campaign in at least one foreign language. Keep in mind NYC is the mecca of sanctuary cities in America

Understand where we are: Marxist-aligned Democrats are offering government handouts to migrants to establish a new, dependent voting class. This invasion—driven by a mass migration of third-worlders and supported by dark money-funded NGOs and the federal gov't during the Biden-Harris regime—has been used to reshape the electorate. The Democratic Party's political future entirely hinges on protecting criminal illegal aliens.

Tyler Durden Thu, 06/26/2025 - 10:00

US Worked On Plan To Destroy Iran's Fordow For 15 Years, But European Intel Says Uranium Stockpile Was Moved

Zero Hedge -

US Worked On Plan To Destroy Iran's Fordow For 15 Years, But European Intel Says Uranium Stockpile Was Moved

Summary: As expected Hegseth during the Thursday morning Pentagon press conference excoriated the mainstream media for its coverage of the Trump-ordered attacks on Iran's nuclear sites. This after repeatedly praising Trump's leadership at yesterday's NATO summit.

"I hope, with all the ink spilled, all of your outlets find the time to properly recognize this historic change in continental security that other presidents tried to do, other presidents talked about," Hegseth said. "President Trump accomplished it. It’s a huge deal." He strongly pushed back especially against CNN reporting that the strikes merely set back Iran's nuclear program by months, again, framing the avalanche of MSM skepticism as supposedly due merely to anti-Trump bias and not wanting to give him a 'win'.

"Again, it was preliminary, a day and a half after the actual strike, when it admits itself in writing that it requires weeks to accumulate the necessary data to make such an assessment," the defense secretary said. The president "created the conditions to end the war, decimating – choose your word – obliterating, destroying Iran’s nuclear capabilities," he asserted, before reading aloud the assessments of various US and foreign intelligence heads.

Much of the press conference consisted of a highly detailed narrative of what it was like for troops - from officers to enlisted privates - in the Middle East as Iran's very brief retaliatory missile strike rained down on Qatar, and US-manned anti-air batteries intercepted the inbound projectiles. There was also a lot of focus on the pilots and crew of the B-2s and their marathon 37-hour bombing run all the way from Missouri to Tehran and back. The presser, especially while Hegseth was speaking, was charged with patriotism and emotion - much more than is normal for a Pentagon press briefing.

Chairman of the Joint Chiefs of Staff Gen. Dan Caine emphasized in a detailed way the specs of the 30,000 pound bombs dropped on the Iranian sites, and they "functioned as designed, meaning they exploded."

"A point that I want to make here: the Joint Force does not do [battle damage assessments]," Caine told the press pool. "By design, we don’t grade our own homework. The intelligence community does. But here’s what we know following the attacks and the strikes on Fordow: First, that the weapons were built, tested and loaded properly. Two, the weapons were released on speed and on parameters. Three, the weapons all guided to their intended targets and to their intended aim points. Four, the weapons functioned as designed, meaning they exploded. We know this through other means intelligence means that we have that were visibly, we were visibly able to see them. And we know that the trailing jets saw the first weapons function." He actually cited one pilot's eyewitness account as saying the blast from the initial bombs was so big as it was like an overwhelming flash of daylight

Among the more interesting assertions and revelations was that the Pentagon has been working intensely on the operation, particularly to take out the Fordow site, for-15 years. While the US military often spends a lot of time on various 'contingency' options to present to the Commander-in-Chief, Gen. Caine's description of two Pentagon analysts who devoted a decade-and-a-half of their lives to studying just Fordow strongly suggests the US long ago knew it would pull the trigger at some point.

"In the days preceding the attack against Fordow, the Iranians attempted to cover the shafts with concrete to try to prevent an attack. I won’t share the specific dimensions of the concrete cap, but you should know that we know what the dimensions of those concrete caps were," Caine said. "The planners had to account for this, they accounted for everything. The cap was forcibly removed by the first weapon, and the main shaft was uncovered."

And President Trump soon after the Pentagon briefing ended, wrote the following on Truth Social:

Meanwhile, Fox is reporting that the Senate has finally received a delayed Iran briefing. This seems to continue a long GWOT era tradition of presidents across administrations bombing first, and then notifying Congress later.

Meanwhile, the international debate over just where Iran's enriched uranium stockpile is now located (if it's not destroyed) continues to intensify, despite the Trump denials that it remains:

  • TRUMP: NOTHING WAS TAKEN OUT OF THE FACILITY
  • IRAN LAW SUSPENDING IAEA COOPERATION COMES INTO EFFECT

Simultaneous to Trump issuing another statement rejecting the thesis that the uranium has been moved and hidden, Financial Times reports in a strangely worded headline ("Iran moved uranium from Fordow before US strikes, EU capitals believe") the following:

Iran’s highly enriched uranium stockpile remains largely intact following US strikes on its main nuclear sites, European capitals believe, calling into question President Donald Trump’s assertion that the bombing “obliterated” the Islamic republic’s nuclear programme.

Two people briefed on preliminary intelligence assessments said European capitals believe Iran’s stockpile of 408kg of uranium enriched close to weapons-grade levels was not concentrated in Fordow, one of its two main enrichment sites, at the time of last weekend’s attack. It had been distributed to various other locations, the capitals believe.

This would indeed be an interesting twist - that the bulk of enriched uranium stockpiles were not even located at Fordow, which appeared to be the heaviest hit in the US operation. According to more:

The people said EU capitals were still awaiting a full intelligence report on the extent of the damage to Fordow — which was built deep beneath a mountain near the holy city of Qom — and that one initial report suggested “extensive damages, but not full structural destruction”. Iranian officials have suggested the enriched uranium stockpile was moved before the US bombing of the plant, which came after days of Israeli strikes on the country.

But again, the White House as well as Thursday Pentagon presser is sticking by the Trump claim of total and utter obliteration. Perhaps the world will learn the truth in the coming days and weeks, or possibly not at all, pending 'proof' and data from the ground, which the Iranians will likely not be willing to give. For some of our prior coverage on this pressing coverage, see--

Where Is Iran's Uranium? Top Secret Leaked US Intel Says Core Nuclear Components 'Intact'

* * *

After blasting the 'fake news' and mainstream outlets NY Times and CNN in particular in Wednesday comments at the NATO summit, President Trump will continue 'setting the record straight' on the Iran bombings, as the Pentagon is set to hold an "irrefutable" press conference on Thursday morning, providing more details on last weekend's B-2 bomber raids on the Iranian nuclear sites of (per AI summary)--

  • Fordow Fuel Enrichment Plant: A heavily fortified, deeply buried uranium enrichment site near the northern city of Qom.
  • Natanz Nuclear Facility: Iran's main uranium-enrichment complex, located near Isfahan in central Iran.
  • Isfahan Nuclear Technology Center: A key conversion and research facility south of Isfahan city.

Very unusually, the US President claimed that 'fake news' reports upset the pilots who flew the bombs over Iran, by claiming that Iran's nuclear capability was not in fact completely destroyed.

"Secretary of Defense (War!) Pete Hegseth, together with Military Representatives, will be holding a Major News Conference tomorrow morning at 8 A.M. EST at The Pentagon, in order to fight for the Dignity of our Great American Pilots," Trump posted to Truth Social. 

"These Patriots were very upset! After 36 hours of dangerously flying through Enemy Territory, they landed, they knew the Success was LEGENDARY, and then, two days later, they started reading Fake News by CNN and The Failing New York Times. They felt terribly," he continued.

WATCH LIVE (to start at 0800ET):

Hegseth is also expected to address a controversial leaked Defense Intelligence Agency (DIA) report, first revealed by CNN, which strongly suggested that the US strikes did not destroy Iran's nuclear capability:

Two of the people familiar with the assessment said Iran’s stockpile of enriched uranium was not destroyed. One of the people said the centrifuges are largely “intact.” Another source said that the intelligence assessed enriched uranium was moved out of the sites prior to the US strikes.

“So the (DIA) assessment is that the US set them back maybe a few months, tops,” this person added.

Most recently the CIA has since backed the Trump admin's claims, with CIA Director John Ratcliffe on Wednesday having sought to clarify in a statement that the agency had obtained "a body of credible evidence [that] indicates Iran’s Nuclear Program has been severely damaged" by recent strikes. But then this too includes somewhat ambiguous language.

Tyler Durden Thu, 06/26/2025 - 09:42

BYD Slumps After Scaling Back Production, Rising Inventories, Slower Sales Growth

Zero Hedge -

BYD Slumps After Scaling Back Production, Rising Inventories, Slower Sales Growth

BYD stock and its U.S. listed ADRs slumped about 3% on Wednesday this week, after it was reported the vehicle manufacturer was cutting production.

China’s top automaker is scaling back production at several factories due to rising vehicle inventories and slower-than-expected sales growth, multiple outlets including Reuters and CarNewsChina reported.

The company has canceled night shifts and delayed adding new production lines, reducing output at at least four factories by about one-third. “There were two reasons for the mentioned actions: saving costs and failing to meet targets,” two sources told Reuters.

In May 2025, BYD launched aggressive discounts across 22 of its models, slashing prices by as much as 53,000 yuan (USD 7,390) in an attempt to ease dealership backlogs. However, inventories continued to rise despite the deep price cuts. A major dealer network in eastern China even suspended operations, partly due to unsold stock.

According to a May 2025 survey by the China Automotive Dealer Association, BYD dealers held an average of 3.21 months of inventory—more than double the national brand average of 1.38 months—making it the highest among all carmakers in the country.

The report continues, saying production is also showing signs of strain. Although BYD’s domestic sales rose 11% year-over-year to over 1.15 million vehicles from January to May, and exports more than doubled to 374,200 units, data from the China Association of Automobile Manufacturers (CAAM) showed production growth had nearly stalled at just 0.2% in May.

Despite these challenges, BYD set a record for car registrations in China during the week of June 16–22, hitting 83,400 units—an 18.6% increase from the prior week and nearly 25% higher than the same week in 2024. In total, the company registered 208,550 vehicles in the first three weeks of June.

We've noted over the last year that BYD has been the tip of the spear in Chinese auto manufacturing becoming more popular globally.

Over the past year, BYD has emerged as the dominant force in the global auto market, overtaking Tesla in Q4 2024 as the world’s top seller of battery-electric vehicles.

Its total sales reached 4.27 million in 2024—a 41% jump—driven by aggressive pricing, a strong domestic lead in China, and surging exports, which more than doubled to over 417,000 units. BYD's vertically integrated supply chain and wide model lineup, including the best-selling Seagull and Atto 3, gave it a cost and production edge.

Tyler Durden Thu, 06/26/2025 - 09:40

RFK Jr.'s New Vaccine Panel Lost Member Ahead Of First Meeting

Zero Hedge -

RFK Jr.'s New Vaccine Panel Lost Member Ahead Of First Meeting

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

A doctor who was named to a federal advisory panel has decided not to serve, the Department of Health and Human Services (HHS) said on June 24.

Health Secretary Robert F. Kennedy Jr. testifies on Capitol Hill in Washington on June 24, 2025. Madalina Kilroy/The Epoch Times

“Dr. Michael Ross decided to withdraw from ACIP [Advisory Committee for Immunization Practices] during the financial holdings review required of members before they can start work on the committee,” an HHS spokesperson told news outlets in a statement.

The sacrifice to serve on ACIP varies from member to member, and we appreciate Dr. Ross’s willingness to go through this rigorous process.”

Health Secretary Robert F. Kennedy Jr. named eight members, including Ross, to the committee earlier in June, after dismissing all 17 members of the panel.

The committee advises the Centers for Disease Control and Prevention on vaccines and is set to meet in Atlanta on June 25 and June 26.

The CDC website listing members does not show Ross as a member of the panel. Ross could not be reached for comment.

Ross, who holds a medical degree, previously worked as a professor at George Washington University and Virginia Commonwealth University, spokespersons for the schools confirmed to The Epoch Times. His résumé also includes time as a member of a CDC panel that offered advice on preventing cancer and research into breast cancer prevention.

Ross is listed as an operating partner at Havencrest Capital Management, a biotechnology company that has invested in companies involved in vaccine development and autism therapy.

Ross’s biography on Havencrest’s website describes him as “a serial CEO and physician leader with over 35 years of executive experience in leading private healthcare and life science companies.”

Kennedy, when announcing Ross as a new member, said that “his continued service on biotech and healthcare boards reflects his commitment to advancing innovation in immunology, reproductive medicine, and public health.”

Kennedy told members of a congressional panel in Washington on Tuesday that the Advisory Committee for Immunization Practices was “rife with conflicts at the pharmaceutical companies.” An Epoch Times review found that some of the people removed by Kennedy voted on vaccines despite receiving or recently receiving money from firms that stood to benefit from the votes.

Kennedy also defended his new hires, telling lawmakers that “none of them are anti-vax” and highlighting the experience of the chair, longtime epidemiologist Martin Kulldorff, and a member, Dr. Robert Malone, who helped invent messenger ribonucleic acid (mRNA), which is utilized in COVID-19 vaccines made by Pfizer and Moderna.

He added, “We have scientists, immunologists, toxicologists, every kind of medical discipline you would want on that committee.”

Sen. Bill Cassidy (R-La.) said earlier in the week that new members hold scientific credentials but that “many do not have significant experience studying microbiology, epidemiology, or immunology.”

“In particular, some lack experience studying new technologies such as mRNA vaccines, and may even have a preconceived bias against them,” he said.

Cassidy, the chairman of the Senate Health Committee, called for this week’s committee meeting to be delayed until more members are named.

Tyler Durden Thu, 06/26/2025 - 09:25

Q1 GDP Revised Lower As Personal Spending Unexpectedly Prints Weakest Since Covid

Zero Hedge -

Q1 GDP Revised Lower As Personal Spending Unexpectedly Prints Weakest Since Covid

Of all the economic reports, the BEA's periodic update of US GDP is the most useless because not only is it politically motivated, but it gets constantly revised so much that by the time we get a somewhat accurate description of how strong the economy is, it is already one - if not two quarters - later. Today's second estimate of Q1 GDP - a quarter which ended almost two months ago - is just such an example. 

Moments ago the BEA reported that in Q1, US GDP shrank at a 0.5% annualized pace, a deterioration from the -0.2% first revision (which was also the median estimate), which in turn was an improvement from the -0.3% initial print; 

According to the BEA, GDP was revised down 0.3 percentage point from the second estimate, primarily reflecting downward revisions to consumer spending and exports that were partly offset by a downward revision to imports.

While there were few notable changes between the initial report and the first and second revision, the most notable one was in personal consumption which has continued to deteriorate, and was first cut by a third from 1.7% increase in the original print to 1.2% in the first revision, and today, to just 0.5%, making this the weakest quarter for personal spending since the covid crash.

Here are some other notable changes:

  • Personal consumption contributed just 0.31% to the bottom line GDP print, down from 0.80% in the first revision and from 1.21% in the original estimate; also down sharply from 1.21% in Q4.
  • Fixed Investment came at 1.31%, largely unchanged from the 1.34% in the previous revision, and driven by major data center investments
  • The change in private inventories was also flat, printing at 2.59% in the third estimate, down from 2.64% in the second and from 2.25% initially.
  • Trade or net exports (exports less imports), was generally in line, subtracting 4.76% from the GDP number, a modest improvement from the 4.9% previous revision, and from the 4.84% original print.
  • Finally, government subtracted 0.10% from the GDP number, a slight improvement from the -0.12% decline in the previous estimate.

And visually:

The sharp revision in personal consumption meant that Real final sales to private domestic purchasers, the sum of consumer spending and gross private fixed investment, often viewed as a much more accurate indicator of actual growth, increased by 1.9% in the first quarter, revised down 0.6% from 2.5% in the first estimate, and 1.1% from the original estimate.

While the GDP data was stale, the inflation data was especially so, even if there were even fewer changes here:

  1. GDP price index rose 3.8%, up fractionally from the 3.7% increase in the previous estimate.
  2. Core PCE (ex food and energy) was 3.5%, also a fractional increase from the 3.4% previously reported.

Overall, the report painted an uglier picture of the US economy in Q1, although it is likely a "kitchen sink" because in Q2 we expect that the bullwhip from the reversal in imports (a boost to GDP) coupled with the deferred surge in personal consumption to propel Q2 GDP to 3% if not higher.

Tyler Durden Thu, 06/26/2025 - 09:03

Biggest Export Decline Since COVID Lockdowns Unexpectedly Widens US Trade Deficit In May

Zero Hedge -

Biggest Export Decline Since COVID Lockdowns Unexpectedly Widens US Trade Deficit In May

The US merchandise-trade deficit unexpectedly widened in May (widening 11.1% to $96.6 billion in May, exceeding the $86.1 billion expectation) on the biggest drop in exports since the onset of the pandemic, while imports were little changed.

Source: Bloomberg

US merchandise exports decreased 5.2% to $179.2 billion in May (the biggest drop since May 2020), reflecting a sharp decline in shipments of industrial supplies such as crude oil.

Source: Bloomberg

Imports were little changed at $275.8 billion, a month after the largest decline on record.

Source: Bloomberg

As a reminder, the figures aren’t adjusted for inflation.

In the first quarter, inbound shipments of foreign goods surged as US companies stocked up on goods and materials ahead of tariffs that President Trump imposed.

The tariff front-running is over... obviously.

As Bloomberg reports, the wider May deficit indicates trade may contribute less to second-quarter growth than initially anticipated. Prior to the latest figures, the Federal Reserve Bank of Atlanta’s GDPNow estimate showed net exports contributing more than 2 percentage points to second-quarter GDP.

Tyler Durden Thu, 06/26/2025 - 08:58

Ayatollah Claims 'Victory' Over Israel Which 'Almost Collapsed' In 1st Public Appearance Since Ceasefire

Zero Hedge -

Ayatollah Claims 'Victory' Over Israel Which 'Almost Collapsed' In 1st Public Appearance Since Ceasefire

Supreme Leader Ayatollah Ali Khamenei on Thursday issued his first comments since the Trump-backed ceasefire with Israel took effect, congratulating "the great nation of Iran" for its "victory over the fake Zionist regime."

"Despite all that noise, and with all those claims, the Zionist regime almost collapsed and was crushed under the blows of the Islamic Republic," he said, according to the national IRNA news agency. He also claimed to have "delivered a slap to America’s face."

via Associated Press

At a moment the Trump administration is celebrating to 'obliteration' of the Islamic Republic's core elements and main facilities of its nuclear program, the Ayatollah downplayed the effects of the military campaign.

He described that the United States entered the war along Israel's side "because they felt that if they did not enter, the Zionist regime would be destroyed." He presented this as a sign of Israeli weakness, echoing prior statements issued during the aerial raids.

"However, the Americans did not gain anything in this war," he asserted. He went to say that those that attacked Iran suffered a high cost. According to more from state media translation:

“We thank God for aiding our armed forces, who managed to breach their advanced multilayered defense systems and flatten large parts of their military and urban centers with powerful missile and weapons strikes,” he said.

Ayatollah Khamenei said it proves to the Zionist regime that aggression against the Islamic Republic comes with a high cost that it will have to pay, crediting both the armed forces and the people of the Islamic Republic for the glorious victory.

The last couple days since the ceasefire has held saw throngs of people come out into Tehran streets, to demonstrate in solidarity with the military, and to show defiance and that the 12-days of attacks did not bring the nation to its knees.

There have been other signs of symbolic defiance and resistance as well, including public events and a concert by the Tehran Symphony Orchestra, which goes back nearly 100 years. On Wednesday, in the city's popular Azadi Square, reports described:

As residents gathered for the performance, the orchestra played “Ey Iran,” the country’s unofficial national anthem that has long been considered a song of national pride and resistance and had once been banned by the Islamic Republic due to its association with anti-government sentiment.

Established in 1933, the orchestra has survived multiple regimes, coups, revolution and wars, widely seen as a symbol of resilience.

Its hardest days came during the term of hardline president Mahmoud Ahmadinejad when the orchestra was disbanded due to sanctions, financial difficulties and negligence.

It total over 630 Iranians died and thousands were injured in the strikes, with Israel also claiming to have assassinated at least 14 Iranian nuclear scientists and many more high-ranking military commanders.

But Israel, and Tel Aviv especially, had whole building and neighborhoods leveled, and had some of its military command centers hit by Iranian ballistic and hypersonic missiles. On the other side, much of Tehran was destroyed, and the Iranians admit that key nuclear facilities suffered significant damage; however, they have pledged that nuclear energy development will continue as a matter of national sovereignty. 

Tyler Durden Thu, 06/26/2025 - 08:50

Boeing Binge-Buying Sparks Biggest Jump In US Durable Goods Orders In 11 Years

Zero Hedge -

Boeing Binge-Buying Sparks Biggest Jump In US Durable Goods Orders In 11 Years

Following last month's plunge in headline durable goods orders, preliminary May data was expected to surge on the back of plane orders following Trump's visit to the MidEast (and the Paris Air Show).

And they were right but the magnitude is incredible - orders rose a stunning 16.4% MoM, the biggest jump since July 2014...

Source: Bloomberg

This was all driven by non-defense aircraft orders... which rose 230% MoM..

Source: Bloomberg

...as 'ex-transports', orders rose just 0.5% MoM (still better than expected)...

Source: Bloomberg

Capital goods shipments rose 0.5%, excluding defense and commercial aircraft, better than expected, adding to Q2 GDP growth hopes.

Tyler Durden Thu, 06/26/2025 - 08:48

Labor Market Creaks... Continuing Jobless Claims Highest Since Nov 2021

Zero Hedge -

Labor Market Creaks... Continuing Jobless Claims Highest Since Nov 2021

The trend of (modestly) rising initial jobless claims stalled last week, dropping from 246k to 236k (below 2435k exp)...

Source: Bloomberg

But, Continuing jobless claims kept rising to 1.974 million Americans - the highest since Nov 2021...

Source: Bloomberg

In the 'Deep TriState' region, jobless claims continue to rise also...

Source: Bloomberg

Delayed DOGE effects finally kicking in.

Tyler Durden Thu, 06/26/2025 - 08:39

Q1 GDP Growth Revised down to -0.5% Annual Rate

Calculated Risk -

From the BEA: Gross Domestic Product, 1st Quarter 2025 (Third Estimate), GDP by Industry, and Corporate Profits (Revised)
Real gross domestic product (GDP) decreased at an annual rate of 0.5 percent in the first quarter of 2025 (January, February, and March), according to the third estimate released by the U.S. Bureau of Economic Analysis. In the fourth quarter of 2024, real GDP increased 2.4 percent..

The decrease in real GDP in the first quarter primarily reflected an increase in imports, which are a subtraction in the calculation of GDP, and a decrease in government spending. These movements were partly offset by increases in investment and consumer spending.

Real GDP was revised down 0.3 percentage point from the second estimate, primarily reflecting downward revisions to consumer spending and exports that were partly offset by a downward revision to imports.
emphasis added
Here is a Comparison of Third and Second Estimates. PCE growth was revised down from 1.2% to 0.5%. Residential investment was revised down from -0.6% to -1.3%.

Weekly Initial Unemployment Claims Decrease to 236,000

Calculated Risk -

The DOL reported:
In the week ending June 21, the advance figure for seasonally adjusted initial claims was 236,000, a decrease of 10,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 245,000 to 246,000. The 4-week moving average was 245,000, a decrease of 750 from the previous week's revised average. The previous week's average was revised up by 250 from 245,500 to 245,750.
emphasis added
The following graph shows the 4-week moving average of weekly claims since 1971.

Click on graph for larger image.

The dashed line on the graph is the current 4-week average. The four-week average of weekly unemployment claims decreased to 245,000.

The previous week was revised up.

Weekly claims were close to the consensus forecast.

S&P Futures Jump, Set For New Record High As VIX, Dollar Tumble

Zero Hedge -

S&P Futures Jump, Set For New Record High As VIX, Dollar Tumble

US equity futures extend their torrid short squeeze rally and are set to hit a new all time high for the S&P, with Tech outperforming while volatility is falling rapidly. As of 8:00am, S&P futures rose 0.3% to 6,170 while Nasdaq futures gained 0.5% with all Mag7 names higher again, and semis aiding the rally after solid earnings from Micron; cyclicals outperform defensives. The VIX is trading below 17 amid a relentless selloff in volatility, and heading for a four-month low, despite Trump’s looming trade deal deadline and other simmering risks. The dollar slumped to the lowest since April 2022 as traders ramped up bets for faster US interest-rate cuts, spurred by a WSJ report that Trump may fast-track his nomination for the next Federal Reserve chief. Treasury yields declined across the curve, with the 10-year rate down two basis points to 4.27%. Commodities are seeing a rebound led by Ags/Precious metals. Today’s macro data focus includes Durable/Cap Goods, Initial Claims, and regional Fed activity indicators. On Durable/Cap, Goldman expects a +15% MoM surge in Durables thanks to the sharp increase in aircraft orders after Trump's visit to the Middle East; Initial Claims are expected to print at 243k.

In premarket trading, Mag 7 stocks are higher alongside index futures (Nvidia +1.3%, Alphabet +1%, Meta +0.8%, Amazon +0.7%, Microsoft +0.4%, Tesla -0.1%, Apple -0.1%). 

  • Micron (MU) climbed about 1.5% after solid earnings, while Nvidia is set to extend its advance into record territory, rising 1.1%.
  • Apple Inc. (AAPL) shares fall 0.1% after its price target was cut at JPMorgan to $230 from $240 on the iPhone 17’s incremental lineup launch.
  • Microsoft (MSFT) edges up 0.4% after Morgan Stanley raised its price target to $530 from $482, citing upside from the company’s Azure cloud service.
  • General Mills (GIS) rises 0.7% after RBC raised its recommendation to outperform from sector perform, noting that the packaged food company’s full-year earnings-per-share guidance showed it would be able to weather the sluggish backdrop.
  • Jefferies (JEF) shares slip 2.5% after reporting earnings that missed estimates, hurt by a slump in deal activities between March and May due to the market turmoil.
  • Trade Desk (TTD) falls 2.2% after Wells Fargo Securities cuts its rating on the stock to equal-weight from overweight, predicting the advertising technology firm would feel a greater competitive impact from Amazon in 2026.
  • Truist Financial Corp. shares (TFC) rise 1.5% after Citi raised its recommendation to buy from neutral, citing its balance sheet growth and its relatively cheap stock price likely increasing buybacks.

In corporate news, Tokyo Gas is said to be in discussions with multiple US liquefied natural gas suppliers to secure a long-term purchase agreement. Mars’s $36 billion takeover of snack maker Kellanova was given the green light by the FTC on the same day EU regulators opened up a lengthy probe of the deal. Shell said it has no intention of making a takeover offer for BP.

The Bloomberg dollar index fell 0.4% to the lowest level since April 2022; Treasury yields declined across the curve, with the 10-year rate down two basis points to 4.27%, as markets are pricing 64 basis points of easing from the Fed by the end of the year, compared to 51 basis points at the end of last week, with a 20% chance of a quarter-point cut next month.

The moves followed a WSJ report that Trump may announce Powell’s successor as soon as September, which could essentially create a “shadow” central bank chair who’s more open to rate cuts, before Powell’s term is over (market now pricing in a 25% chance of a July cut/100% chance of a cut by Sept meeting). According to the WSJ, "the president has toyed with the idea of selecting and announcing Powell’s replacement by September or October, according to people familiar with the matter…Trump is considering former Fed governor Kevin Warsh and National Economic Council director Kevin Hassett. Treasury Secretary Scott Bessent is being pitched to Trump by allies of both men as a potential candidate. Other contenders include former World Bank President David Malpass and Fed governor Christopher Waller."

The “discussion around naming a Fed chair early and that Fed chair presumably being more dovish, or willing to do a little more of what Trump wants to do in terms of cutting rates, it’s all going to weigh on rates and the dollar,” said Timothy Graf, head of EMEA macro strategy at State Street Global Markets.

Sentiment was boosted by the continued gains in chip stocks and the AI theme: Micron climbed about 1.5%, while Nvidia Corp. is set to extend its advance into record territory, rising 1.1%. “The Micron earnings are likely to boost tech again and when tech thrives, everything thrives,” said Pierre Alexis Dumont, chief investment officer at Sycomore Asset Management. “In that sense, we could reach a new record today.”

Sure enough, Barclays strategists expect US stocks to see further gains and note that “fears of a foreign buyers’ strike against US assets are overdone.” Elsewhere, the Treasury Department is nearing a deal that would make the so-called “revenge tax” irrelevant, a development that could bring relief to Wall Street investors worried about punitive tax measures on foreigners.

Meanwhile, the VIX is now below 17 and heading for a four-month low, despite Trump’s looming trade deal deadline and other simmering risks. It’s a big day for macro data, with durable goods, GDP and the Fed’s preferred inflation gauge, core PCE, all on deck.

Turning to trade, Deputy Treasury Secretary Michael Faulkender said the expectation is that, following negotiations with US trading partners, tariffs won’t go back as high as the reciprocal levies Trump announced on April 2. Japan’s chief trade negotiator said the country can’t accept the US’s 25% tariffs on cars, as Japanese automakers produce far more cars in the US than they export to it. China’s $1.3 trillion sovereign wealth, CIC, is in retreat from the US, as tensions with the US throw up investment roadblocks and Beijing seeks to lower risk by reining in the massive fund. 

In Europe, the Stoxx 600 rises 0.2%, lifted by retail shares after H&M delivered better-than-expected profit. Miners are also outperforming while auto shares lag. Here are some of the biggest movers on Thursday:

  • H&M shares gain as much as 7.9%, the most since April, after the Swedish fast-fashion retailer reported better-than-expected second-quarter earnings.
  • Valeo shares rise as much as 5% after Morgan Stanley double-upgrades the French car parts manufacturer, citing the stock’s attractive valuation.
  • Proximus shares rise as much as 7% as Berenberg takes a more positive view on the outlook for cash returns from European telecommunications companies over 2025-2030 as the firm initiates, re-initiates and transfers coverage of 20 stocks in the sector.
  • Volex shares gain as much as 19% as Jefferies says the power products manufacturer’s results came in ahead on all metrics.
  • South African Precious Metal shares rise after platinum rose to the highest since 2014 on solid demand from Chinese jewelry buyers who are favoring the metal over gold.
  • Carrefour shares slide as much as 6.2%. JPMorgan places stock on negative catalyst watch and downgrades estimates across the board ahead of the supermarket group’s first-half results.
  • Traton falls as much as 4.9% as Bankhaus Metzler downgrades to sell and sets a joint Street-low target on the German truckmaker to reflect short-term downside risk.
  • Moonpig shares plunge as much as 12%, the most since December, after the online greeting card company said CEO Nickyl Raithatha is standing down after seven years in the role.
  • Next 15 shares plunge as much as 22% as the growth consultancy firm said annual profit will be materially below expectations, following a warning about potential misconduct at its Mach49 brand.
  • Yara International shares tumble as much as 3.2% on news that China is loosening its ban on urea exports, a move that is likely to ease surging international prices that have been buoyed by tension in the Middle East.

Earlier in the session, Asian equities advanced, lifted by technology shares after Nvidia climbed to a record high. Stocks in South Korea and Hong Kong retreated following recent rallies. The MSCI Asia Pacific Index advanced as much as 0.9%, poised for its best three-day gain since April. The benchmark is trading at its highest level since September 2021. Tech stocks were among the biggest boosts to the gauge after Nvidia reclaimed its position as the world’s most valuable company, suggesting that the AI trade has further to run. Meanwhile, Hong Kong shares were on track for their first loss in five sessions and Korean stocks paused one of the world’s hottest rallies of the year.

In FX, the Bloomberg Dollar Spot Index is down 0.4%, the lowest since April 2022, and on course for a fourth straight day of declines after the Wall Street Journal reported US President Donald Trump is considering an early appointment for the next Federal Reserve chairman. That’s bolstering expectations that Fed interest rates will be cut sooner than previously expected. The Japanese yen is leading gains against the greenback, rising 0.9%. The Swiss franc and pound outperform most of their G-10 peers.

In rates, treasuries gain on the back of news that a shadow Fed chair may soon be revealed. Front-end yields are 2bp-3bp richer, keeping 2s10s and 5s30s spreads near Wednesday’s highs. 10-year around 4.27% is 1bp lower on the day with bunds and gilts lagging by 0.5bp and 1.5bp in the sector. Fed-dated OIS contracts price in around 62bp of easing for the year, of which about 5bp are priced for the next policy meeting in July. The week’s coupon auction cycle concludes with $44 billion 7-year note sale, following unremarkable results for 2- and 5-year notes; WI 7-year yield near 4.03% is ~16.5bp richer than last month’s, which stopped through by 2.2bp

In commodities, spot gold climbs $8 to around $3,340/oz. WTI is little changed near $65 a barrel.

Looking at today's calendar, US economic data slate includes May trade balance, May preliminary wholesale inventories, 1Q GDP revision, May Chicago Fed national activity and durable goods orders and weekly jobless claims (8:30am), May pending home sales (10am) and June Kansas City Fed manufacturing activity (11am). Fed speakers include Goolsbee (8:30am), Barkin (8:45am), Daly (8:45am), Hammack (9am), Barr (1:15pm) and Kashkari (7pm)

Market Snapshot

  • S&P 500 mini +0.3%
  • Nasdaq 100 mini +0.4%
  • Russell 2000 mini +0.2%
  • Stoxx Europe 600 +0.2%
  • DAX +0.8%
  • CAC 40 +0.2%
  • 10-year Treasury yield -1 basis point at 4.28%
  • VIX -0.1 points at 16.68
  • Bloomberg Dollar Index -0.4% at 1194.63
  • euro +0.5% at $1.1715
  • WTI crude little changed at $64.87/barrel

Top Overnight News

  • The dollar sold off to a 3 year low and treasury yields fell on bets that US rate cuts may come sooner than expected as Trump increases pressure on Powell.  The WSJ reported he may name a replacement for the Fed chair as early as September. Among those being considered for the job are former Fed Governor Kevin Warsh, NEC Director Kevin Hassett and Treasury Secretary Scott Bessent. BBG 
  • US Senate Republicans are reportedly considering delaying cuts to Medicaid in a bid to win over more moderate holdouts from the party, who threaten progress of the Reconciliation Bill: Punchbowl.
  • Congress is still hashing out Trump’s tax bill, with the SALT deduction a point of tension between the chambers. US Republican Representative Lalota said, in reference to SALT, "We are far from a deal still."  Senator Susan Collins also floated a tax hike on those making more than $100 million a year. BBG 
  • US President Trump is set to hold a “One, Big, Beautiful Event” at the White House on Thursday to urge the Senate to pass the reconciliation bill, according to a White House official: CBS News.
  • US tariffs will probably fall well below the April 2 levels after negotiations with trade partners, Deputy Treasury Secretary Michael Faulkender said. Meanwhile, Japan said it can’t accept 25% tariffs on its cars, a sticking point in talks. BBG 
  • China has taken a series of actions in the past week on counter-narcotics, in a sign of cooperation with U.S. demands for stronger action on the synthetic opioid fentanyl, a key irritant in the bilateral relationship. RTRS 
  • Chinese premier Li Qiang said on Thursday reforms and a shift to a consumption-led model in the world's No. 2 economy will help it continue to be the world's biggest driver of economic growth. RTRS 
  • China’s oil demand may have peaked in 2023, with consumption falling 1.2% last year amid slowing growth and rising EV adoption, the Energy Institute said. The shift may accelerate the prospect of a global usage plateau. BBG 
  • German Chancellor Friedrich Merz is demanding that Brussels strike a trade deal with the United States within days, as concerns grow that the EU will end up with an unbalanced agreement that only benefits Donald Trump. BBG 
  • Investors are fleeing long-term US bond funds at the swiftest rate since the heights of COVID 5 years ago as America’s soaring debt load tarnishes the appeal of one of the world’s most important markets. Net outflows from long dated US bond funds spanning government and corp debt have hit nearly $11bn in the 2nd quarter. FT 
  • Blue Origin and Jeff Bezos reportedly appealed to the White House for more government contracts following Elon Musk’s departure: WSJ.
  • Meta (META) has reportedly poached three OpenAI researchers – Lucas Beyer, Alexander Kolesnikov, and Xiaohua Zhai: WSJ
  • BlackRock (BLK) is increasing its push into private investments; intends to offer a 401(k) target date fund with a 5-20% allocation to private investments, depending on investor age, in H1-2026: WSJ

Trade/Tariffs

  • Japanese Economy Minister Akazawa said Japan will continue tariff talks with the US ahead of reciprocal tariffs due on July 9th, but cannot accept the 25% auto tariff, according to Reuters.
  • India and US trade talks face roadblocks ahead of the tariff deadline, according to Reuters citing sources; India is resisting tariff cuts without US commitments; delegation is exp. to travel to US before deadline.
  • Chinese authorities are dragging out approval of Western companies’ requests for rare earths, two weeks after the nation said it would ease exports, according to WSJ.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks traded mixed in choppy fashion following a similar session on Wall Street, with overnight newsflow relatively light as Israel and Iran seemingly continued to observe the ceasefire. ASX 200 was weighed on by the tech sector despite outperformance in the space stateside. ASX-listed software giant Xero fell over 7% after announcing its intention to purchase payments provider Melio for around USD 3bln. Nikkei 225 outperformed and topped the 39k mark for the first time in over a month, led by strong gains in the industrial sector. This came despite a firmer JPY, with market focus turning to the upcoming US-Japan trade talks after local media flagged Japanese Economy Minister Akazawa’s planned visit to Washington as early as June 26th. Hang Seng and Shanghai Comp were mixed, while Chinese Premier Li said authorities will take forceful steps to boost consumption. Thereafter, bourses drifter higher as a Chinese state planner official said that with policy implementation and introduction, "we are confident and capable of minimizing the adverse impacts from external shock."

Top Asian News

  • Chinese state planner official said with policy implementation and introduction, "we are confident and capable of minimising the adverse impacts from external shock", according to Reuters.
  • The PBoC injected CNY 509.3bln via 7-day reverse repos, maintaining the rate at 1.40%.
  • Citi raised its China 2025 GDP growth outlook to 5.0% (prev. 4.7%).
  • Chinese Commerce Ministry (on rare earth export licenses for EU firms) says it has been accelerating development of rare earth export licenses in accordance with the law

European bourses (STOXX 600 +0.2%) are generally modestly firmer across the board, following a mixed and choppy APAC session overnight. Though it is worth noting that price action (aside from the DAX 40) has been quite choppy and within a tight range so far. European sectors hold a positive bias, in-fitting with the broadly positive mood in European indices. Basic Resources takes the top spot, lifted by strength in metals prices following positive commentary from Chinese Premier Li and the State Planner; the latter said that with policy implementation and introduction, they are confident in minimising adverse effects from external shocks. Retail is found in the second spot, buoyed by post-earning strength in H&M (+5.2%).

Top European News

  • German GfK Consumer Sentiment (Jul) -20.3 vs. Exp. -19.3 (Prev. -19.9, Rev. -20.0)
  • Swedish Total Industry Sentiment (Jun) 94.8 (Prev. 98.9); Sentiment (Jun) 92.8 (Prev. 94.6)Manufacturing Confidence (Jun) 99.3 (Prev. 100.1); Consumer Confidence SA (Jun) 84.6 (Prev. 83.1)

FX

  • DXY is on the back foot for the fourth consecutive day, and currently trades towards the lower end of a 96.93-60 range – the index now trades at levels not seen since March 2022. Overnight reporting suggested that US President Trump may accelerate the announcement of a successor to Fed Chair Powell, possibly as early as this summer, or in September or October, according to WSJ sources. A slew of US data later, including US PCE (Q1), GDP Final (Q1), Jobless Claims and Durable Goods. Fed speak today via Daly, Barkin, Hammack, Barr and Kashkari.
  • EUR/USD continues to benefit from the broader Dollar weakness and currently trades above 1.17; session peak at 1.1744. EZ-specific docket has been exceptionally light today; German GfK Consumer Sentiment printed a touch below expectations, no reaction on this.
  • JPY is the G10 outperformer today, largely thanks to the pullback in US yields overnight and broader Dollar weakness. USD/JPY has fallen below both its 21 DMA (144.50) and 50 DMA (144.27) to currently trade below the 144.00 mark at around 143.83. Overnight, upside in the JPY was briefly capped on reports that Japanese Economy Minister Akazawa said Japan will continue tariff talks with the US ahead of reciprocal tariffs due on July 9th, but cannot accept the 25% auto tariff.
  • GBP also benefits from the Dollar weakness and trades at multi-year highs, and marginally topped its 2022 high at 1.3749. Beyond that, there is a little bit of clear air up until the 1.3800 mark, whereby the high from Oct 29 2021, at 1.3804 may be in focus. UK-specific newsflow has been very light so far, but docket ahead includes BoE's Bailey.
  • Antipodeans are modestly benefitting from the Dollar weakness, but also amid some positive commentary out of China overnight – remarks which helped to boost base metals also. Firstly, the Chinese State Planner said with policy implementation and introduction, "we are confident and capable of minimising the adverse impacts from external shock", according to Reuters. Secondly, Premier Li said authorities will take forceful steps to boost consumption. Lastly, Citi raised its China 2025 GDP growth outlook to 5.0% (prev. 4.7%).
  • PBoC set USD/CNY mid-point at 7.1620 vs exp. 7.1561 (prev. 7.1668); strongest CNY fix since Nov 8 2024
  • HKMA bought HKD 9.42bln as the Hong Kong dollar hit the weak end of its trading range, marking the first such intervention since 2023 to defend the currency peg.
  • South African President Ramaphosa is reportedly considering a cabinet reshuffle, via News24 citing sources; this could involve Deputy Trade Minister Whitfield and Minister Nkabane. USD/ZAR lifted from 17.62 to 17.70 on speculation of, and since source reporting around, a potential cabinet reshuffle.

Fixed Income

  • USTs are firmer, benefitting from the WSJ reports that President Trump could announce the next Fed Chair much earlier than is traditionally the case. Trump himself has intimated he has the list down to a handful of individuals; unsurprisingly, all those on the WSJ list are or are expected to err on the dovish side of things. USTs to a 111-28 peak thus far, notching another best for the month and now to within a point of the 112-23 peak from May, but of course still a significant distance from the mark. Ahead, 7yr supply rounds off the week’s taps, which have gone well thus far. US data and Fed speak is also due.
  • Bunds are also bid, in-fitting with the above. A bout of upside was seen at 07:00BST, from 130.62 to 130.74 in the space of two-three minutes. Upside that occurred alongside a soft German GfK survey, a release that shows that while the government’s fiscal support is aiding business expectations this is yet to filter through to the individual consumer level. Since, Bunds have continued to climb and peaked at 130.80 before experiencing a modest pullback as the morning continued and the risk tone continues to improve. Action that has caused Bunds to pullback from the above high by around 15 ticks, but remain in the green by a similar magnitude. Ahead, the docket features ECB speak from heavyweights Lagarde, de Guindos and Schnabel.
  • Gilts gapped higher by 14 ticks and then continued to climb, above Wednesday’s 93.38 open to a 93.45 high for today; just shy of Tuesday’s 93.51 peak and 92.57 from Wednesday thereafter. Ahead, the docket is sparse and as such Gilts will likely follow the narrative of US events, particularly anything further on the Fed Chair, and speeches from the ECB and Fed.
  • UK sells GBP 1.0bln 4.25% 2046 Gilt, via tender: b/c 1.99x, average yield 5.162%.

Commodities

  • WTI and Brent began the European morning on the front foot, taking impetus from the softer USD and improving risk tone. Drivers that were sufficient to lift WTI and Brent to peaks of USD 65.57/bbl and USD 67/08/bbl, respectively. However, as the morning progressed and despite or perhaps in-part because of the lack of newsflow the benchmarks have lost ground with WTI now below USD 65.00/bbl and threatening a move into the red.
  • Spot gold is firmer given the softer USD and lower yield environment on the back of the WSJ-Fed report around an early Fed Chair nominee announcement. A move that has been interpreted as one to undermine the authority of Chair Powell, with a dovish move occurring on the back of it given the list of potential nominees all fall on that side of the hawk-dove discussion. XAU itself gleaning some further impetus on the narrative that the undermining of Chair Powell draws into question the Fed's credibility and/or independence. XAU up to a USD 3350/oz peak, firmer but yet to approach USD 3369/oz or USD 3398/oz from Tuesday and Monday.
  • 3M LME copper is firmer, benefiting from the increasingly constructive risk tone and the discussed USD pressure. Sentiment boosted by China-related headlines overnight; Firstly, the Chinese State Planner said with policy implementation and introduction, "we are confident and capable of minimising the adverse impacts from external shock", according to Reuters. Secondly, Premier Li said authorities will take forceful steps to boost consumption. Lastly, Citi raised its China 2025 GDP growth outlook to 5.0% (prev. 4.7%).
  • Citi reaffirms its Brent forecast of USD 66/bbl and USD 63/bbl for Q3- and Q4-2025, respectively
  • Goldman Sachs upgraded its H2 2025 LME copper price forecast to an average of USD 9,890/t (prev. USD 9,140/t), citing a tariff-driven reduction in ex-US stocks and resilient activity in China. The bank expects copper to peak at USD 10,050/t in 2025, before easing to USD 9,700/t by December. For 2026, it forecasts an average copper price of USD 10,000/t (prev. USD 10,170/t), reaching USD 10,350/t.

Geopolitics

  • Al-Akhbar reports that another round of talks between Israel and Hamas is expected within the next few days, according to Egyptian sources cited; Hamas is reportedly ready to release all hostages in exchange for Israeli commitments
  • Iranian defences shot down an unknown drone over the border strip with Iraq, according to Al Arabiya; the incident occurred over the border area of Siba in southern Iraq, according to Al Hadath.
  • CIA Director said the CIA can confirm that credible intelligence indicated Iran’s nuclear programme had been severely damaged by recent strikes. Several key Iranian nuclear facilities had been destroyed and would have to be rebuilt over the course of years, according to Reuters.
  • US President Trump called on Israeli Prime Minister Netanyahu’s domestic trial to be cancelled immediately and for him to be granted a pardon, via Truth Social.
  • The Pentagon released a document outlining FY26 weapons requests, including funding for 24 F-35 warplanes and two submarines, according to Reuters.

US Event Calendar

  • 8:30 am: May P Wholesale Inventories MoM, est. 0.17%, prior 0.2%
  • 8:30 am: 1Q T GDP Annualized QoQ, est. -0.2%, prior -0.2%
  • 8:30 am: 1Q T Personal Consumption, est. 1.2%, prior 1.2%
  • 8:30 am: 1Q T GDP Price Index, est. 3.7%, prior 3.7%
  • 8:30 am: 1Q T Core PCE Price Index QoQ, est. 3.4%, prior 3.4%
  • 8:30 am: May Chicago Fed Nat Activity Index, est. -0.13, prior -0.25
  • 8:30 am: May P Durable Goods Orders, est. 8.5%, prior -6.3%
  • 8:30 am: May P Durables Ex Transportation, est. 0%, prior 0.2%
  • 8:30 am: May P Cap Goods Orders Nondef Ex Air, est. 0.1%, prior -1.5%
  • 8:30 am: May P Cap Goods Ship Nondef Ex Air, est. -0.12%, prior -0.1%
  • 8:30 am: Jun 21 Initial Jobless Claims, est. 243.19k, prior 245k
  • 8:30 am: Jun 14 Continuing Claims, est. 1950k, prior 1945k
  • 10:00 am: May Pending Home Sales MoM, est. 0.13%, prior -6.3%

Central Bank Speakers 

  • 8:30 am: Fed’s Goolsbee Appears on CNBC
  • 8:45 am: Fed’s Barkin Speaks on the Economy
  • 8:45 am: Fed’s Daly Appears on Bloomberg TV
  • 9:00 am: Fed’s Hammack Gives Opening Remarks
  • 1:15 pm: Fed’s Barr Speaks on Community Development
  • 7:00 pm: Fed’s Kashkari in Q&A at Montana Chamber Event

DB's Jim Reid concludes the overnight wrap

Markets were broadly steady yesterday, with few headlines to push things in either direction. Indeed, for a sense of that, the S&P 500 fell just -0.0003%, which was its smallest move in either direction since 2017, whilst the 10yr Treasury yield only moved -0.4bps. Admittedly, there were several political developments, but none really had a market-moving impact, and the ceasefire between Israel and Iran continued to hold. We also heard from Fed Chair Powell again at the Senate Banking Committee, but after his testimony the previous day, there was little that changed our understanding of the Fed’s near-term outlook either. So there were few big moves among the major assets, and with calm returning to markets again, the VIX index of volatility (-0.72pts) closed at a 4-month low of 16.76pts.

With markets holding steady, we’re now at a point where the focus is turning to several important catalysts over the next two to three weeks. The first is the US tax bill, which is currently working its way through the Senate, and the administration is trying to get it passed by Independence Day on July 4. To achieve that, things could move quickly from here, and Senate Majority leader Thune has previously said to Axios that they could start voting on the bill tomorrow.

Moreover, Politico also reported earlier this week that House Speaker Johnson told House Republicans to stay in town, given that the House needs to pass the same version as the Senate before President Trump can sign the bill. So it’s a fluid situation on timing, but given the upcoming July 4 deadline, it will need to move swiftly in the days ahead in order to pass by then. Remember that alongside the tax cuts, the bill also contains an increase to the debt ceiling, so if passed, it would remove that risk from the summer as well.

As well as the tax bill, the focus is set to swiftly turn back to tariffs, as the 90-day extension to the reciprocal tariffs ends in less than two weeks’ time on July 9. As it stands, it’s still unclear what will happen at that point, although several countries remain in negotiations with the US. The administration has signalled that trade deals are likely to follow the passage of the tax bill, and NEC director Kevin Hassett said earlier in the week that “We know that we’re very close to a few countries and are waiting to announce after we get the Big Beautiful Bill closed”.

After that, the June CPI report on July 15 is likely to assume outsize importance, as that’ll be crucial for whether the tariff pass-through is being felt in consumer prices. Only yesterday, Fed Chair Powell mentioned the uncertainty around this, saying that in terms of who’ll pay for the tariffs, “it’s very hard to predict that in advance”. But it’s crucial for the path of rate cuts, as those officials calling for caution have in part based that around the tariff impact showing up in the summer inflation numbers. We’ve already seen an impact in categories like major appliances, and even with the 90-day reciprocal tariff delay, there’s still the baseline 10% in place, as well as others in place like the steel/aluminium tariffs, the Canada/Mexico tariffs, and the China tariffs.

With all that to look forward to, markets remained in a holding pattern yesterday, with the S&P 500 (-0.0003%) holding steady as investors awaited to see what would happen on the above issues. The overall mood leant on the cautious side, with the equal-weighted version of the S&P down -0.75% and small cap Russell 2000 (-1.16%) seeing a sizeable underperformance. However, tech stocks advanced, with the NASDAQ 100 (+0.21%) hitting a fresh all-time high, whilst the Mag-7 were up +0.47% as Nvidia (+4.33%) posted a record high of its own. Meanwhile, banks (+0.87%) outperformed within the S&P 500 as the Fed Board unveiled plans to ease the enhanced Supplementary Leverage Ratio. By contrast, the declines were more consistent in Europe, with losses for the STOXX 600 (-0.74%), the DAX (-0.61%) and the CAC 40 (-0.76%).

On the geopolitical front, the ceasefire between Iran and Israel continued to hold over the last 24 hours, and President Trump said on Iran that “We’re going to talk to them next week”. Nevertheless, oil prices did recover a bit after falling over -12% over Monday and Tuesday, with Brent crude up +0.80% yesterday to $67.68/bbl, and overnight they’re up another +0.33%. Separately, the NATO leaders’ summit was taking place in the Netherlands, where the leaders agreed that by 2035, they’d spend 5% of GDP “on core defence requirements as well as defence-and security-related spending”. That’s going to be made up of 3.5% on the “core defence”, and 1.5% of GDP on areas like infrastructure.

Reviewing the summit outcome, my colleague Peter Sidorov writes that while several European countries may struggle to reach the 3.5% core spending target, it’s the ramp-up of spending and defence industrial capacity over the next few years that will determine the success of Europe’s new defence strategy.

In the meantime, sovereign bonds saw a fresh steepening yesterday. 2yr Treasury yields fell -4.3bps as investors continued to dial up expectations of Fed rate cuts, with the amount priced by year-end rising to 64bps, its highest since early May. Those moves came even as Fed Chair Powell again struck a patient tone at the Senate Banking Committee.

Significantly overnight, the WSJ also reported that President Trump is considering announcing the new Fed Chair earlier than usual, potentially by September or October, although the person would not replace Powell until next May when his current four-year term ends. That’s helped to push Treasury yields lower overnight, with the 10yr yield down another -2.2bps to 4.27%. And in turn, that’s weighed on the dollar index, which is trading at a 3-year low this morning, whilst the euro is currently trading at its highest level against the dollar since late-2021, at $1.1685.

Over in Europe, 10yr bunds (+2.2bps) underperformed OATs (+0.8bps) and BTPs (+1.5bps) for a fourth day running, following on from the increased German borrowing announcement the previous day.

Overnight in Asia, there’s been a pretty mixed performance across the major equity indices. The Nikkei (+1.35%) has posted a strong advance, which would leave the index at a 4-month high. But others have struggled, and South Korea’s KOSPI is down -1.27% after hitting its highest level since September 2021 the previous day. Elsewhere, the Hang Seng (-0.48%) and CSI 300 (-0.01%) have posted smaller losses, with the Shanghai Comp (+0.11%) only up a small amount. And looking forward, US equity futures are up slightly, with those on the S&P 500 up +0.07%.

Lastly, there was little data yesterday, although US new home sales fell by more than expected to an annualised rate of 623k in May (vs. 693k expected). That’s their lowest level since October, and the monthly drop of -13.7% was the biggest monthly decline since June 2022.

To the day ahead now, and data releases in the US include the weekly initial jobless claims, pending home sales for May, preliminary durable goods orders for May, and the third estimate of Q1 GDP. Central bank speakers include ECB President Lagarde, Vice President de Guindos, and the ECB’s Schnabel, BoE Governor Bailey, and the Fed’s Barkin, Daly, Hammack and Barr. Finally, an EU leaders’ summit will begin in Brussels.

Tyler Durden Thu, 06/26/2025 - 08:25

Israel's National Airline Offers 'Deep Discounts' To Repatriate Those Who Fled Iran Missiles

Zero Hedge -

Israel's National Airline Offers 'Deep Discounts' To Repatriate Those Who Fled Iran Missiles

Via The Cradle

El Al, Israel's national airliner, has introduced heavily subsidized return flights on 25 June aimed at repatriating Israelis who fled during the recent war against Iran.

The state-backed offer includes capped fares through the end of June – $99 from European cities and $649–699 from the US – roughly half the standard price. Once repatriation flights are full, remaining seats will become available to the general public.

Source: Flash90

In Cyprus, where thousands of Israelis remain, emergency repatriation efforts continue. Cruise ships and diverted flights have brought back many in recent days, but Jewish community leaders warn that shelters and resources are overstretched as people await flights home.

This campaign was triggered by the closure of Israeli airspace on June 13, after Iranian missile strikes damaged key infrastructure following Israeli attacks on top Iranian figures.

Since the ceasefire went into effect on June 24,Israeli airports such as Ben Gurion and Haifa have fully reopened, and wartime travel restrictions – including the exit ban – have been lifted.

While inbound flights have resumed, a cabinet resolution had required Israelis to obtain approval from an “exceptions committee” before travelling abroad – but this is no longer necessary following the ceasefire.

Foreign nationals have been permitted to leave via land or sea since the air ban, but Israeli citizens were previously barred from purchasing outbound flights. As a result, hundreds fled by yacht from Herzliya, Haifa, and Ashkelon, sailing to Cyprus before onward travel to Europe.

Egypt emerged as another escape route. Sinai authorities raised the alert level due to an influx of Israelis via the Taba crossing. Security officials cautioned that the arrival wave could be used by Mossad operatives posing as tourists, presenting surveillance and destabilization risks.

This movement sparked criticism from Egyptian activists, particularly given Cairo’s crackdown on Gaza-bound aid convoys. “It is outrageous that Israelis can walk into Sinai, but activists … are turned away,” one organizer told Middle East Eye (MEE).

Many of those who fled hold dual citizenship – either immigrants who retained their original passports or Israeli-born citizens who later acquired second nationalities. Common destination countries include the US, EU states, Russia, and Ukraine.

The repatriation campaign highlights growing contradictions. While Israel actively encourages returnees with subsidized flights, its wartime policies briefly trapped its own citizens abroad or forced them into risky sea evacuations.

Tyler Durden Thu, 06/26/2025 - 07:45

Winnebago Slashes Guidance As RV Slump Deepens; Management Uses Cautious Tone

Zero Hedge -

Winnebago Slashes Guidance As RV Slump Deepens; Management Uses Cautious Tone

Shares of Winnebago Industries plunged nearly 10% on Wednesday after the recreational vehicle maker—best known for its travel campers—slashed its full-year outlook, citing persistent pressure on consumer demand from mounting macroeconomic headwinds and elevated borrowing costs. The RV industry downturn, now well entrenched, has been underway since the Federal Reserve began hiking interest rates in early 2022.

"Growing macroeconomic uncertainty led to a notable downshift in RV activity from consumers and dealers as the third quarter progressed," Winnebago CEO Michael Happe told Wall Street analysts on a call yesterday. 

Happe told the analysts that "these challenges are likely to continue through the remainder of the calendar year as anticipated by the RV Industry Associations." 

He said that for 2025, "We are lowering our industry forecast for wholesale RV shipments to a range of 315k to 335k units, with a midpoint of 325k units." The previous forecast was 320k to 350k units, with a median of 335k units.

The company now expects net revenue between $2.7 billion and $2.8 billion for the year, down from its previous guidance of $2.8 billion to $3 billion. This is compared with an estimate $2.76 billion (Bloomberg Consensus). The company also lowered its adjusted earnings guidance to a range of $1.20 to $1.70 per share, down from $2.75 to $3.75, compared to the estimate of $1.80.

Winnebago is one of the major players in the recreational vehicle space, which was hit hard in a multi-year downturn, mainly due to soaring interest rates during Fed Chair Powell's hiking cycle. 

The takeaway for the third fiscal quarter, which ended in May, is that solid performance in the marine and motorhome segments helped offset weakness in the towables segment, although profitability and earnings declined sharply year-over-year.

Winnebago Q3 FY2025 Summary (YoY % Change)

  • Adjusted EPS: $0.81 (▼28% YoY) — missed estimate of $0.83

  • Adjusted EBITDA: $46.5M (▼20%) — beat estimate of $45.5M

  • Operating Income: $30.2M (▼31%) — missed estimate of $31.8M

  • Net Revenue: $775.1M (▼1.4%) — in line with estimate of $774.8M

Segment Breakdown:

  • Motorhome: $291.2M (▼2.6%) — beat est. $272.9M

  • Towables: $371.7M (▼3.8%) — missed est. $401.4M

  • Marine: $100.7M (▲15%) — beat est. $97.2M

Shares are flat in pre-market trading, but Wednesday's session was a bloodbath—with the stock puking nearly 10% to its lowest level since April 2020. The chart below overlays Winnebago's share price with the Fed's rate-hiking cycle. Note the lagging effect, followed by a sharp selloff as demand collapses under the weight of rising interest rates; in other words, demand falls off a cliff.

First takes by Wall Street analysts were mostly cautious (courtesy of Bloomberg):

CFRA (hold)

  • "Management's tone was understandably cautious in light of soft consumer discretionary spending and uncertainty surrounding interest rate cuts," analyst Garrett Nelson tells Bloomberg News in an email

  • "The big question is whether or not US RV sales have bottomed, which will determine the timing of the company's earnings recovery," he adds

Truist (buy, PT $40)

  • Analyst Michael Swartz says Towable RV share gains headline an "otherwise difficult" 3Q for WGO

  • "The cat was already out of the bag with regard to the FY3Q miss and incrementally more challenged view of the motorized business (namely, the Winnebago branded business)"

Roth (neutral, PT $37)

  • Analyst Scott Stember says WGO's adjusted 3Q25 EPS of $0.81 came in above his "tempered" expectations

  • "WGO formally lowered '25 adjusted EPS guidance to new range of $1.20-$1.70, noting that the company did not update the year when pre-releasing Q3 last month"

BMO Capital (outperform, PT $50)

  • Analyst Tristan Thomas-Martin says WGO's 3Q EPS of $0.81 came in just ahead of BMO's $0.76 estimate, which was recently lowered following WGO's preliminary release, but within WGO's preliminary range of $0.75 to $0.85

  • "Management commentary around retail demand remains cautious, and FY2025 guidance was reduced with FY4Q25 implied guidance coming in below the Street but closer to where we believe investors were"

It's a great time for anyone who didn't panic-buy an RV during the Covid boom—heavy discounting is seen at various RV retail chains as inventory builds across the market. As for bottom fishing, WGO... needs an interest rate-cutting cycle for earnings recover. Certainly a stock to add to the watch list. 

Tyler Durden Thu, 06/26/2025 - 07:20

Mexico Uses Biden Regime Playbook In Attempt To Hinder Elon Musk's Rocket Launches

Zero Hedge -

Mexico Uses Biden Regime Playbook In Attempt To Hinder Elon Musk's Rocket Launches

Mexican President Claudia Sheinbaum, aligned with far-left politics, is using environmental concerns to challenge Elon Musk's SpaceX, echoing rogue tactics used by the U.S. Democratic Party in an attempt to derail rocket launches. 

Bloomberg reports that President Sheinbaum has accused SpaceX's rocket launches from Starbase, Texas, of polluting Mexican territory with rocket debris.

The social justice warrior president will meet with her cabinet in the near term on the "security and environmental impacts" of the rocket launches. 

She said the government is "reviewing what laws have been violated" and based on that review will "file the necessary lawsuits, adding, "There is indeed contamination." 

The Democrat-aligned financial media outlet in New York cited a report from Mexico's La Jornada, which described how a local environmental group in Tamaulipas discovered rocket debris.

Sheinbaum's move echoes tactics seen in the U.S., where federal agencies under the Biden-Harris regime were weaponized against Musk to delay commercial rocket launches with environmental concerns.  

The larger question now is whether America's foreign adversaries—severely lagging far behind SpaceX in the space race—are quietly influencing President Sheinbaum to disrupt or delay Starbase launches, allowing them time to catch up.

Tyler Durden Thu, 06/26/2025 - 06:55

How To Free America From EU Censorship

Zero Hedge -

How To Free America From EU Censorship

Authored by John Rosenthal via Clairemont Review,

On January 20, 2025, the first day of his second presidential term, Donald Trump signed an executive order: “Restoring Freedom of Speech and Ending Federal Censorship.” The bad old days of the “censorship-industrial complex,” allegedly responsible for suppressing online speech under President Joe Biden, were over.

Except they weren’t. The driving force behind online censorship had never been the U.S. government, which meant that freedom of speech could not be restored by the stroke of a president’s pen. Rather, the European Union has wielded its Digital Services Act (DSA) to restrict the speech not just of Europeans but especially of Americans and other English-speakers. The E.U. has not violated the free-speech rights of Americans, since it has no obligations under the U.S. Constitution. But it has vitiated those rights, essentially nullifying the First Amendment in cyberspace.

The DSA is not a “threat” to free speech, as some American commentators put it, implying that possible danger lies in the future. Because the DSA is in force now, all major online platforms and search engines must comply with it to remain on the E.U. market. There is effectively no free speech on the internet nowadays, at least not on the major platforms falling under the DSA’s strictest provisions, but only more or less heavily curated, algorithmically managed speech.

Some supporters of President Trump might find this hard to believe. After all, the president’s most prominent ally and advisor is Elon Musk, whose purchase of Twitter in 2022 was said to be motivated by a desire to restore free speech to the platform. But Musk has always insisted that “freedom of speech is not freedom of reach,” and there’s the rub. Using platform algorithms to restrict reach artificially is a form of censorship, one that is not only compatible with the DSA but even encouraged by the E.U.

The Trump Administration can truly restore free speech to the internet only by confronting the European Union. The administration needs to challenge the DSA, to get it repealed or at least neutered. If the E.U. refuses to back down, then the administration will need to work with Congress to pass a law ensuring that American tech companies cannot comply with the DSA by restricting Americans’ First Amendment rights.

Germany Censors the World

H.L. Mencken once said that “freedom of the press is limited to those who own one.” But the advent of the internet and the rise of blogs around the turn of the 21st century made Mencken’s observation obsolete. Now, virtually everyone could be a publisher, with the only barrier to entry being the price of an internet connection. The democratic potential of this development is obvious. The rise of social media extended it further, allowing us, in effect, to publish our every passing thought.

The boundary between private conversation and public debate had been blurred and the distinction between freedom of speech and freedom of the press had thus been effaced. Freedom of speech had precisely become freedom of reach.

This development was not universally welcome. Beginning about a decade ago, Germany and then the European Union as a whole launched a series of initiatives that treated the burgeoning of online speech as a threat rather than an opportunity. These first took the form of task forces or “codes of conduct” into which online platforms like Facebook, YouTube, and Twitter were enlisted on an ostensibly voluntary basis. The earliest efforts were devoted to “hate speech,” some forms of which are even illegal in Germany and other European countries, in which freedom of speech does not enjoy protection equivalent to America’s First Amendment. In 2016 the European Commission unrolled a Code of Conduct on Countering Illegal Hate Speech Online, one year after Germany had organized a task force on the same issue. These “voluntary” arrangements soon gave way to binding laws requiring platforms to restrict speech or face penalties.

Already in the early days of the internet, American lawmakers had recognized that the new communications technology’s great potential would be severely constrained if internet service providers or intermediate users, such as hosted forums, were held liable for everything that other users said and/or did in using their services or platforms. In 1996 Congress thus stipulated in Section 230 of the Communications Decency Act: No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.” This meant that all internet users would be responsible for their own words. The intermediate services that merely enabled them to be published would neither bear nor share in the responsibility.

Twenty years later, German and European legislators took the opposite approach, insisting that online platforms would bear not only liability but indeed special liabilities for what users said or posted on them. First the so-called Network Enforcement Act or “NetzDG” in Germany in 2017 and then the E.U.’s 2022 Digital Services Act touted this approach under the motto “What is illegal offline, should be illegal online.” But what was illegal offline still was illegal online anyway. This was never the issue. The issue was who is to be held accountable for it.

As Congress realized in 1996, if the platforms were held accountable, then they would be forced to censor. Indeed, they would be forced to censor much more than just illegal content, since they could not know in advance what exactly the competent judicial authorities would judge to be illegal. As Facebook’s German subsidiary put it in 2017 in a statement objecting to the NetzDG legislation, they would have to apply the principle “in dubio pro deleo” [sic]: when in doubt, delete!

There was another problem. “What is illegal offline, should be illegal online” is all well and good—but illegal in what jurisdiction? Many utterances illegal in Germany would clearly be protected speech in America. But the internet is global. Germany’s NetzDG, in effect, extended German laws to the entire world. The real practical import of the law was “What is illegal offline in Germany, should be illegal online everywhere.”

This was made abundantly clear by the NetzDG notices that many American and other English-speaking Twitter users received. Even if the notices typically concluded reassuringly that users’ posts were not in contravention of German law, they left them understandably wondering why their posts had to comply with German law in the first place. What’s more, despite the reassurances, Seth Dillon of the satirical website The Babylon Bee determined that his account would be locked and remain so until he deleted content that had been “reported by people from Germany.”

The E.U. as Arbiter of Truth Itself

Such notices would disappear once the Digital Services Act went into effect. The DSA also superseded NetzDG in Germany, but the same principle applies. The world’s online discourse is now subject to E.U. law, which means, in turn, subject to all the speech laws of each of the 27 E.U. member states. Individuals or “entities” can still report offending content to the platforms. National authorities can name “trusted flaggers” whose reports are given priority treatment. And, under the DSA’s Article 9, both member states and the European Commission can simply issue orders requiring action against specified content. Noncompliant platforms face ruinous fines of up to 6% of their global turnover.

Under the DSA regime, however, platforms are expected to censor much more than just illegal speech. They must also act against alleged mis- or disinformation—not on the grounds that it is illegal, but on the grounds that it is “harmful.” The DSA thus extends online censorship from so-called hate speech to purely factual discourse. In so doing, it makes the European Commission and, in a subsidiary role, E.U. national authorities not just arbiters of compliance with their own laws but arbiters of truth itself.

Already in 2018, the European Commission had rolled out a second “code,” the Code of Practice on Disinformation, to supplement the 2016 Hate Speech Code. Under its aegis, the Commission then launched a dedicated program for specifically combatting COVID-19 “disinformation” in June 2020. In the meantime, in December 2019, incoming Commission President Ursula von der Leyen had first unveiled the DSA as her hallmark piece of legislation, the very purpose of which was to turn the “voluntary” commitments undertaken under the Codes into legal obligations.

Online censorship of alleged COVID-19 mis- or disinformation represented a watershed in the history of free speech and censorship in the West. In light of internal communications revealed in Elon Musk’s “Twitter Files” publications, and several highly publicized though unsuccessful lawsuits inspired by them, many Americans would come to believe that online platforms were censoring lockdown skeptics and COVID-19 vaccine critics at the behest of the Biden Administration. Never mind that the censorship was already well underway by mid-2020, while Donald Trump was still president. Indeed, the Twitter account of the Zero Hedge website was already suspended at the end of January 2020 for posting an article on a potential lab origin of the new coronavirus—a hypothesis President Trump endorsed.

In any case, thanks to the First Amendment, the Biden Administration never had any stick with which to threaten the platforms. It could ask them to remove posts or suspend accounts, but the platforms could always decline.

The European Commission, however, was not just making occasional, informal requests. Under its “Fighting COVID-19 Disinformation Monitoring Programme,” all the major online platforms and search engines were required to report, first monthly and later every other month, on their efforts to suppress such “disinformation.” Twitter, for example, complied by submitting detailed statistics on “global” content removals and account suspensions. This meant that content was being removed and accounts suspended all around the world, to satisfy the European Commission.

There was no need for anyone to reveal private communications with E.U. officials to find out about this. The program was public, and the companies’ reports on their censorship activities were made available in a public archive, even if almost no one paid attention. (For more, see “The EU Files: What Elon Musk Is Not Telling You About Twitter Censorship,” by Robert Kogon, published by the Brownstone Institute, February 22, 2023.)

Moreover, the Commission did have something with which to threaten the platforms: namely, the impending DSA fines. By June 2020, the tech companies had had ample time to read the legislation and knew what was coming their way.

Some of them, including Google, Facebook, and Microsoft, having already been hit with fines in the hundreds of millions or even billions of euros by the Commission, were not going to take the Commission’s expectations lightly in the context of COVID-19. It is true, of course, that they were even less likely to do so after January 2021, with a new Democratic administration that, far from defending free speech, was asking them to do precisely what the E.U. was demanding.

The censorship reached a peak in summer of 2022 with a massive purge of thousands of COVID-dissident Twitter accounts, which left the owners of surviving accounts, like the American COVID-19 vaccine critic Alex Berenson, wondering “what is going on.”

But there ought not to have been any mystery. On July 5, the European Parliament passed the Digital Services Act—to the almost total indifference of the news media and public, in Europe as much as the United States. In combination with the Commission’s rollout three weeks earlier of a “strengthened” Code of Practice on Disinformation—consisting of a long list of far more stringent commitments than the original Code—it was inevitable that passage of the legislation would prompt swift and aggressive action on the part of the platforms. The DSA had arrived. Censorship was becoming law.

Censorship Goes Underground

Today, with Donald Trump having returned to the White House and the owner of X serving as his special advisor, Americans might well imagine that online censorship has already been defeated and free speech restored. But executive orders prohibiting federal censorship do nothing to accomplish this, since the American government was never able to require censorship from the tech companies in the first place. Complaints about a mythical “censorship-industrial complex” distract us from the reality of the E.U. regulatory regime and its transnational success in getting American companies to curtail Americans’ free-speech rights. Furthermore, Elon Musk is also complying with the E.U. censorship regime by curtailing Americans’ free-speech rights. Censorship has not disappeared from Twitter since his purchase and rebranding of the company as “X,” it has merely gone underground.

Account suspensions and content removals—the blunt instruments of censorship employed against COVID-19 “disinformation”—have indeed largely disappeared and seem to be used only in exceptional cases, presumably involving, as a rule, actual or alleged illegality. But the DSA also allows platforms to meet their obligations by way of “demotion” or “restriction of visibility.” In the same spirit, the 2022 “strengthened” Code of Practice commits platforms to mitigating the risk of “viral propagation” of disinformation by taking measures to reduce the latter’s “prevalence, views, or impressions.”

This, of course, is the essence of Elon Musk’s “freedom of speech is not freedom of reach,” a formulation that has allowed Musk to promote X as a “free speech platform” while still satisfying his obligations to censor “misinformation” and other allegedly harmful speech under the DSA. X does not need to remove such content to satisfy the E.U. It is enough, as X CEO Linda Yaccarino put it in a 2023 interview with CNBC, to make it “extraordinarily difficult to see.”

Misinformation “safety labels” are indeed built right into the published part of the X algorithm. These are not the famous “Misleading!” labels that would be prominently displayed on alleged COVID-19 misinformation under the old Twitter regime and that would lead to account suspension after “three strikes.”

Like the old “Misleading!” labels, the safety labels limit the shareability of posts to which they are applied, thereby satisfying E.U. demands. But unlike the “Misleading!” labels, the “safety labels” are not visible to the public. They are back-office labels that are only visible to platform administrators.

This means that while alleged “misinformation” is still being censored on X, unlike under the old regime we do not even know what the platform is treating as misinformation. The content in question simply disappears from public view without a trace. Since the algorithm can ensure that no one or hardly anyone is seeing them in the first place, this also eliminates the need to suspend the offending accounts.

As was true under the Fighting COVID-19 Disinformation program, platforms and search engines are required to submit publicly available reports quantifying their “content moderation” efforts under the DSA. Per X’s April 2024 “DSA Transparency Report,” during roughly just the prior five months the platform took enforcement action on 226,350 of 238,108 items reported to it by E.U. member states or the European Commission—or fully 95% of the reported items. Of the items, 40,331 were deleted and access to 62,802 items was blocked in the E.U. This means, however, that 123,217 items, over half, “merely” had their visibility restricted.

To appreciate the vast extent of the stealth censorship occurring on X, one must keep in mind that the above statistics are limited to content directly flagged by E.U. governmental authorities. They do not include content singled out by individuals, entities, or government-appointed “trusted flaggers.” Above all, they do not include the undoubtedly far larger swath of discourse proactively suppressed by X’s own automated systems or human content moderators to remain in the E.U.’s good graces.

X’s DSA Transparency Report specifies, incidentally, that 1,535 of the then-1,726 members of the platform’s content moderation team—or nearly 90% of them—spoke English as their main language. Nothing could make the overwhelmingly extra-European impact of the DSA more obvious. Post-Brexit, barely 1% of the E.U.’s own population speak English as their native language.

Lest readers have trouble reconciling the foregoing with the highly publicized proceedings against X that were already opened by the European Commission in December 2023, it should be noted that these proceedings, as they now stand, have nothing to do with the platform’s “content moderation” but only with other, more arcane aspects of the DSA. The original proceedings did indeed involve content moderation and could even have had a positive impact on freedom of speech, since X was supposed to be investigated not for failing to suppress user content, but rather for failing to inform users about it. But this aspect has been dropped.

An American Anti-Digital Services Act

So, what does the Trump Administration need to do to defeat E.U. censorship and restore genuine free speech to the internet? The First Amendment’s prohibition on Congress making any law “abridging the freedom of speech” was sufficient to secure free-speech rights for two centuries. But in 2025, when so much speech is online and foreign governments can thus make laws abridging Americans’ speech rights, it is not. This is what Germany did in 2017 when enacting NetzDG and what the E.U. did, to far greater effect, in 2022 when enacting the DSA.

But by what right should Germany or the E.U. be allowed to dictate what Americans can or cannot say? If the German government wants to censor Germans or the European Commission Europeans, that is one thing. But the American government has to make clear that if a foreign government wants to censor Americans or require American companies to do so on their behalf, then the U.S. will take action to defend its citizens’ rights.

Given that American companies are affected, the World Trade Organization could be one venue for challenging the DSA. The aim should be the outright abrogation of the DSA fines: no American company should be subject to fines or any other penalties from a foreign government for respecting Americans’ constitutionally guaranteed rights.

If, however, the E.U. refuses to back down, then the U.S. will need to make it illegal for American companies to cooperate with the E.U. and E.U. member-state governments—or any foreign government—in restricting Americans’ speech rights. The First Amendment prohibits Congress from making any law abridging the freedom of speech. But now, due to the DSA, it needs to enact a specific law protecting freedom of speech against foreign interference.

Such a law should give federal authorities the same draconian powers that the DSA gives the European Commission, but now in the cause of protecting speech rather than suppressing it. If the E.U. is going to fine American companies for respecting Americans’ free-speech rights, then the U.S. government is going to have to fine them for not doing so.

But the power to apply ruinous fines is not the only extraordinary enforcement power that the DSA gives the Commission. Under Article 69, it also gives it the power to conduct what are known as “dawn raids” in the case of suspected non-compliance: i.e., to have investigators break into and seal off company premises, inspect books or records in whatever form, and take away copies of or extracts from whatever books or records they deem relevant to their investigation. The U.S. government needs to have analogous search-and-seizure powers: to prevent the companies from cooperating with the Commission and/or E.U. member state governments. Federal investigators could thus find out exactly what communications the companies are having with the latter. They could find out, for instance, exactly what posts were targeted by the Commission and E.U. member states in the nearly 100,000 reports of “illegal or harmful speech” recorded in the above-cited data from X. If those posts constitute protected speech under American law, then X’s removal of them or restriction of their visibility would constitute a crime.

They could also find out exactly whose user information X has turned over to E.U. member state authorities in connection with such speech. Remarkably, the X data shows that there were nearly 3,000 such requests—or, more precisely, “orders” per Article 10 of the DSA. Nearly 90% of them came from Germany. If the U.S. government may not demand the information of users suspected of speech crimes or other wrong-speak, then surely American companies should not be permitted to provide Americans’ user information to foreign governments on such grounds. This too should be a crime.

Finally, the DSA gives the Commission the all-important power to demand access to social media and search engines’ algorithms (Articles 40, 69, and 72). The Commission has even hired its own programmers and established its own “European Centre for Algorithmic Transparency” (ECAT) to “support the enforcement of the Digital Services Act.”

U.S. investigators should have the same access to platform algorithms—to prevent DSA compliance. Any evidence of tweaking algorithms to satisfy the E.U.’s conceptions of “right-speak” and “wrong-speak” or “correct information” and “misinformation” should lead to sanctions. American online platforms should be neither vehicles of foreign propaganda (via algorithmic amplification) nor enforcers of foreign censorship (via algorithmic suppression).

If the E.U. still insists on its DSA powers when faced with an American law specifically prohibiting American companies from cooperating with the E.U. to censor Americans—or indeed censor any speech available to them—then the companies will simply have to choose. They can either be on the American market or the E.U. market. Or if they want to remain on both, then it will be up to them to find a technical modus vivendi that allows them to comply with both American and E.U. law: for example, by geo-blocking content in the E.U. If the implementation of this solution is financially onerous, as it undoubtedly would be, that is their problem. They can leave the E.U. market and avoid the costs. But censoring Americans’ speech to meet E.U. requirements would no longer be an option.

One thing Republican lawmakers should certainly not do is try to withdraw Section 230 protection from the tech companies as some kind of “punishment” for online censorship. This idea is based upon a fundamental misconception of the origins of online censorship and would only strengthen the hand of the enemies of free speech in the E.U.

The aim of America’s anti-Digital Services Act should be to restore the primacy of American law for Americans. But if freedom of speech is the good that the founders held it to be, then all users of the internet stand to benefit. If the European Union wants to build a new informational Iron Curtain, then that is its business. There is no reason for Americans to be held captive behind it.

Tyler Durden Thu, 06/26/2025 - 06:30

These Are The Places That Rich People Are Leaving

Zero Hedge -

These Are The Places That Rich People Are Leaving

Newly published data by Henley & Partners shows that while China and India were still losing the most millionaires (or billionaires) to emigration in 2023, the United Kingdom's millionaire flight is surging to the top position this year

Some British millionaires have said they are leaving due to the end of the non-domestic tax status rule in the country.

The Tax Justice Network points out that even with the increase, the share of of those departing is still very low compared to all millionaires.

As Statista's Katharina Buchholz reports, the 142,000 millionaires projected to be migrating this year only represent 0.2 of all millionaires globally, its release says.

After migration of the wealthy slumped during the pandemic years, a new high of 120,000 millionaires left their home countries in 2023.

After 2025's 142,000 individuals, wealth out-migration is expected to climb even higher to 165,000 in 2026.

 The Places That Rich People Are Leaving | Statista

You will find more infographics at Statista

According to the source, political stability, personal freedoms as well as tax and financial concerns were among the reasons millionaires decide to make these moves.

The war in Ukraine has led to an exodus of Russians - especially pronounced in 2022 and 2023 - that has seen new arrivals mainly in European cities.

The change represented a 33 percent reduction of Russian millionaires living in their country between 2021 and 2022.

The study covered only individuals with an investable wealth of at least $1 million, who took up residency in a new country and spent at least half of the year there.

Tyler Durden Thu, 06/26/2025 - 05:45

"Drag The EU Into A Direct Conflict" – Orbán Confronts Zelensky, Tells Him EU Was Created For Peace, Not War

Zero Hedge -

"Drag The EU Into A Direct Conflict" – Orbán Confronts Zelensky, Tells Him EU Was Created For Peace, Not War

Via Remix News,

Hungarian Prime Minister Viktor Orbán is leading an effort to ensure Ukraine, which is currently at war with Russia, does not join the European Union due to the high potential for a conflict that could spread to all of Europe.

In this regard, he is now confronting Ukrainian President Volodymyr Zelensky directly on X on the issue.

“President (Zelensky), with all due respect: the European Union was founded to bring peace and prosperity to its member states. Accepting a country that is at war with Russia would immediately drag the EU into a direct conflict. It is unfair to expect any member state to take this risk,” wrote Orbán.

Orbán had responded to a post from Zelensky, in which the Ukrainian leader thanked EU leadership after a meeting, stating that they discussed, among other things, Ukraine’s ascension into the EU.

Citing his meeting with EU commission President Ursula von der Leyen, NATO Secretary General Mark Rutte, and European Council President António Costa, Zelensky called out Hungary.

“It is important that the leaders of the member states reach a common decision to open the first negotiation cluster. It is unfair when a single party blocks the Union’s decision. We also discussed in detail additional sanctions against the Russian Federation and the preparation of the EU’s 18th sanctions package.

This package must significantly increase pressure on Russia’s energy and banking sectors, as well as on the shadow fleet.

The key element here must be a strong price cap on Russian oil, and we count on the appropriate decisions. I thank the leaders for their support. Every step of assistance means lives saved,” he wrote.

Zelensky desires an accelerated process to gain EU membership, despite his country being the most corrupt country in Europe — a finding noted even before the war.

The rebuilding of Ukraine is expected to cost hundreds of billions of euros.

Currently, the country has no democracy or free press, as all elections have been suspended during the war.

Perhaps of greatest concern is that even if Ukraine is admitted to the EU during a ceasefire, hostilities could start again, which could drag Europe further into a new war.

Read more here...

Tyler Durden Thu, 06/26/2025 - 05:00

As 'Peace' Breaks Out, Here's Where US Military Facilities Are In The Middle East

Zero Hedge -

As 'Peace' Breaks Out, Here's Where US Military Facilities Are In The Middle East

Amid a brief pause in proceedings between Iran and Israel, The Pentagon states that the U.S. currently has around 40,000 active-duty troops and Defense Department civilians stationed in the Middle East, with the largest U.S. military site in the region being Qatar’s Al Udeid air base, where some 10,000 troops are stationed

As Statista;s Anna Fleck shows in the chart  below, according to data published by the Congressional Research Service, as of July 10, 2024, personnel were based across Iraq, Syria, Jordan, Egypt, Saudi Arabia, Kuwait, Qatar, the United Arab Emirates, Bahrain and Oman.

Qatar's Al Udeid air base is one of the eight so-called persistent U.S. military bases, which means that it has been continuously used by the U.S. Department of Defense for at least 15 years, with the U.S. military exercising at least some degree of operational control there.

These permanent bases tend to be the DOD’s largest and most well-known.

 Where U.S. Military Facilities Are in the Middle East | Statista

You will find more infographics at Statista

Also marked on this infographic are 11 other selected U.S. military sites. According to the Congressional Research Service, these sites do not meet the persistent bases’ criteria but are places where the DOD maintains some sort of territorially linked presence or access.

This data is based on unclassified sources and does not include all facilities in the region, including temporary sites, which the U.S. military may use for exercises or contingency operations without planning on turning them into persistent sites.

Tyler Durden Thu, 06/26/2025 - 04:15

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