When A Train Wreck Is No Accident

Submitted by Jeff Thomas via InternationalMan.com,

“In spite of all the rhetoric, we will go deeper in debt, the Fed will print more money, and the value of the dollar will continue to plummet.”

- Ron Paul

Never in history have the economic and political structures been so manipulated by those who are responsible for their safekeeping; never has so much been at stake, in so many countries, and facing collapse, all at the same time.

The great majority of people in the First World recognise that the world is passing through an economic crisis. However, most are under the impression that there are some pretty smart fellows running the show and all they need to do is tweak the system a bit more and we’ll return to happy days.

Not so. The “smart fellows” who are in charge of fixing the problem are in fact the very same people who created it.

Understandably, this a hard concept for most people to even consider, let alone accept, as the very idea that those in charge of the system might consciously collapse it seems preposterous. So, we might wish to back up a bit here and present a very brief history of the system itself, in order to understand that the eventual collapse of the economic system was baked in the cake from the very beginning.

Creating a Central Bank

From the very earliest days of the formation of the American republic, bankers (along with inside help from George Washington’s secretary of the Treasury, Alexander Hamilton) sought to create a banking monopoly that would create the country’s currency and become the central banking system.

The first attempt at a central bank was a failure, and strong opponents, including Thomas Jefferson, prevented a second central bank for a time. Later, further attempts were made by bankers and their political cronies, and each central bank was either short-lived or defeated in its planning stages.

Then, in 1913, the heads of the largest banks met clandestinely on Jekyll Island, Georgia, to make another try. Having recently lost yet another bid to create a central bank, due to the public’s understandable concern that the big bankers were already too powerful, a new spin was placed on the idea. This time, they decided to present the idea as a government body that would be decentralised and would have the responsibility of restricting the power of the banks.

However, the new bill was in fact the same old bill, with a new title and some minor changes in wording. But this time, it would be presented by the new president, who was a liberal.

The president, Woodrow Wilson, had in fact been handpicked by the banks. The banks then scuttled their own conservative party’s candidate, got the Democrat Wilson elected, then installed a secretary of the Treasury whose job it would be to ensure that the Federal Reserve was created.

The bill was widely supported by the public, even though, in truth, it was not a federal agency, but a privately owned conglomerate, controlled by the banks. Neither was it a reserve. It was never intended to store money; it was intended to give the biggest bankers control of the economy. They followed the central principle of uber-banker Mayer Rothschild: “Let me issue and control a nation’s money and I care not who writes the laws.”

From the start, the new institution peddled itself as the protector of the people’s interests, but it was quite the opposite. Its purpose from its inception was to control the economy and the government by controlling the issuance of the currency. In addition, it was to be a system of taxation.

Typically, a population accepts a certain amount of direct taxation but has its limits of tolerance. Yet, the bankers understood that a less direct method of taxation was infinitely more profitable and infinitely safer from criticism.

Inflation as a Profit System

Inflation was not always the norm. At one time, prices were relatively static from one generation to the next. But the Federal Reserve touted the idea that “controlled” inflation was in fact necessary for a prosperous economy.

Of course, the greater the debasement of the currency through inflation, the more the central bankers profited. But at some point, the currency would have lost virtually all its value and it would be time for a reset. The currency would need to collapse and a new one created.

And so, the Fed set about its hundred-year programme of continuous inflation. Although there have been periods of lower inflation (and even deflation), the programme stayed more or less on course, and now, its hundred-year life has all but ended: the dollar has been devalued almost 100%.

And so, we find ourselves at the day of reckoning. The economic crisis we are now facing (not only in the US; it will be felt, to a greater or lesser extent, worldwide) is not a mere anomaly that we need to “push past”. It’s a systemic crisis. It’s been created by design and the system must collapse.

Of course, the central banks are in the process of protecting their interests, to make sure that, whilst this will be a major economic calamity, they themselves will continue to profit. The damage will be borne by the general public.

This began in earnest in 1999, with the repeal of the Glass-Steagall Act, allowing banks to create a massive, reckless mortgage spree. It was backed by the government’s “too big to fail” policy that guaranteed that, when the banks predictably became insolvent as a result of the loans, government would bail them out. (And by “government” we mean “the taxpayer”; it was he who picked up the bill for the banks’ recklessness.)

The End Game

The next step in getting ready for the collapse is an all-out effort to confiscate the wealth of the public. This can be seen in the effort to push investors away from solid forms of wealth protection such as gold and silver and into stocks, bonds and bank deposits. More recently, we’ve seen the emergence of an effort to end the use of safe deposit boxes and a push to end the use of paper currency in making transactions.

The end objective is to force as much money as possible into deposits in banks, then take it. The US, EU and a few other countries have passed confiscation legislation, allowing the banks carte blanche to confiscate and/or refuse to release deposits.

Of course a reset of these proportions will not be without its fallout. The public will be horrified at the outcome, at the realisation that the very institutions they thought had been created to protect them had never been intended to serve their interests at all.

Once they realise that the world’s greatest Ponzi scheme has been foisted on them, they will be hopping mad and justifiably so. Those who had not had the foresight to internationalise themselves, to remove themselves as much as possible from the system, will most certainly want to get even in some way.

And this makes clear why governments, particularly that of the US, are working so hard to create a police state. Unless a totalitarian state can be created, those who are presently taking the wealth may not be able to fully realise their objectives.

The coming train wreck is no accident. It has long been planned. That the “smart fellows in charge” will somehow save the day is therefore a vain hope indeed.

It’s still possible to back out of the system, but it’s getting more difficult every day. The window is closing, and the time to internationalise is now.

*  *  *

As the cracks in the global financial system deepen, the window for protecting your wealth and freedom narrows by the day. Understanding how and why this collapse is unfolding—and how to position yourself before the reset—is no longer optional. Our Special Report: Guide to Surviving and Thriving During an Economic Collapse reveals practical steps to safeguard your assets, secure mobility, and stay ahead of the coming financial upheaval. Click here to access your copy and prepare while there’s still time.

Tyler Durden Thu, 11/06/2025 - 17:00

Disagreements Emerge Over US-China Rare Earth Deal, As US Adds Uranium, Silver To Critical Minerals List

Two days ago, when discussing China's surprising announcement that Trump should not cross four "red lines" (including i)Taiwan, ii) democracy and human rights, iii) China's political system, and iv) development rights) or risk a collapse of the trade truce, we said that "ever since the recent "truce" in the trade war between the US and China was signed in Korea one week ago - the latest of many such ceasefires meant to be broken - skeptics have been patiently counting down until this latest ceasefire is torn up, and tensions between the two superpowers flare up once more."

Needless to say, China telling Trump what the US president can and can not say is one of those things that the generally "sanguine and quite calm" US president tends to not be too excited about, and which leads to occasional bursts of outrage which then restart trade wars.

Then yesterday, we said that it felt like "'the cracks in this latest trade deal are already starting to show, whether it is Beijing ordering Trump what he can't talk about, or quietly ring-fencing its domestic data center by banning US Al chips" and further said that "while China granted Trump a 1 year reprieve on rare earths, it is quietly tightening the export noose on other, just as important minerals. According to the Global Times, China has introduced new export controls on silver, antimony, and tungsten."

We concluded that "the game of export whack-a-mole in the second World Trade War continues: today the US is getting rare earths (at least until Trump has another Truth Social meltdown), but just got stopped out on other, just as important materials. This export control rotation will continue until the day the US is self-sufficient, which however due to the abovementioned environmental limitations, will take a very long time unless somehow the US govt funnels enough money in domestic producers (and allows them to dump the toxic by products anywhere - who knows maybe Elon can blast them off into space) to short circuit the process."

Until then, we told readers, "go long stocks of domestic miners that specialize in extracting and producing anything and everything that China feels like no longer exporting to the US."

We didn't have long to wait for this to manifest itself in practice, because moments ago the Nikkei reported that not only is China making inroads with new export controls, but the question over the old ones still hasn't been accurately resolved. That's because, "discrepancies have emerged over the details of China's agreement with the U.S. to pause rare-earth export restrictions, with Washington saying past controls will also be eliminated, a condition that has not been announced by Beijing."

Here is what we know: Trump and Xi Jinping agreed to lower tariffs and ease export restrictions during talks in South Korea last week, with the Chinese Commerce Ministry saying that rare-earth restrictions that had been announced on Oct. 9 would be postponed for a year, there appeared to be some confusion over what was actually agreed upon. 

The restrictions to be paused would have expanded the types of rare-earth elements for which export licenses are required and tightened controls on the export of equipment used for exploration and refining, as well as the technologies necessary for manufacturing rare-earth magnets. They would also require foreign companies making products containing Chinese rare earths to obtain permission from Beijing when exporting to other countries and regions.

And here is where the confusion arises: while China says it will postpone the new regulations for a year, a fact sheet released by the White House on Saturday does not include a time frame, saying "China will suspend the global implementation of the expansive new export controls on rare earths and related measures that it announced on October 9, 2025."

The difference regarding earlier Chinese restrictions implemented on April 4 - which include a requirement for export licenses for seven types of rare earths, including dysprosium, used in high-performance magnets for electric vehicles and fighter jets - is even more pronounced. Following last week's U.S.-China summit, the White House asserted these export licenses would no longer be required, saying China would "effectively eliminate" its current export controls.

But this was contradicted by authorities in the rare-earth industry development zone in Baotou, Inner Mongolia. On Monday, an official social media account stated that the April regulations would remain in effect.

Authorities in Inner Mongolia said on social media that April export controls, which Washington claims will be withdrawn

The city, located in one of China's most polluted areas (because rare earth mining is one of the most toxic activities known to man) is one of China's leading rare-earth producing regions, and the authorities that made the post are reportedly involved in practical matters such as issuing export permits. 

Additionally, Chinese financial news outlet Caixin confirmed the April regulations are still in effect. "As long as the Chinese side deems them valid, the regulations will continue," a Chinese industry insider said.

Some observers say China can continue to pressure the U.S. through customs procedures regardless of whether or not restrictions are in place. Beijing has done this before. In 2010, China halted rare-earth exports to Japan during a dispute over the Tokyo-administered Senkaku Islands, which China claims as the Diaoyu. Although a legal framework for controlling exports was not fully established at that time, Beijing exerted pressure on Japan by claiming procedural delays.

China accounts for 70% of rare-earth production and over 80% of rare-earth magnet manufacturing. It has been leveraging this bargaining chip in negotiations with Washington.

Exports of rare-earth magnets to the U.S. in April were down 59% year-on-year, according to an analysis of trade statistics by Chinese research company FerroAlloyNet. Amid escalating trade friction and the imposition of tariffs over 100% by both sides, exports were drastically cut. They halted almost completely in May, falling 93% on the year.

Global supply chains were thrown into disarray, with Ford Motor temporarily suspending operations at some U.S. plants. In September, the most recent data available, exports of rare-earth magnets to the U.S. were still down 30% year-on-year. 

Some rare-earth elements, including the particularly rare dysprosium, are concentrated in China and a few other countries.

"The U.S. will likely accelerate efforts to develop supply chains independent of China, but for the time being, it will not be able to escape its dependence on China," said a source at a non-Japanese company familiar with rare earths.

Which is precisely what we said yesterday, and why the US will have no choice but to invest billions in domestic companies and supply-chains that bypass China.

Fully aware that the US has to ramp up its own supply chains, the US added copper, silver and uranium to a government list of critical minerals as the Trump administration broadens its scope of what commodities it deems vital to the American economy and national security.

The updated US Geological Survey list adds 10 minerals to bring the total to 60, including metallurgical coal, potash, rhenium, silicon and lead, according to a US government site. It includes 15 rare earth elements. The list replaces a 2022 version. 

Rare earths have become a flashpoint in trade tensions between the US and China, with Trump pushing to encourage domestic mining of the material after President Xi Jinping threatened to curb exports. 

The USGS list dictates what commodities are included in the Trump administration’s Section 232 probe into processed critical minerals and derivative products announced mid-April, which could lead to tariffs and trade restrictions. President Donald Trump has made it a priority to bolster domestic supply of these minerals, arguing that an over-reliance on foreign supplies jeopardizes national security, infrastructure development and technological innovation.

The list also informs direct investments in mining and resource recovery from mine waste, stockpiles, tax incentives for US mineral processing as well as streamlined mining permitting.

The resource industry had been pushing for certain metals and minerals, like copper and potash, to be included on the list. Much of the potash used in the US is shipped from Canada, which accounts for roughly 80% of imports of the mineral. Copper imports, meanwhile, comprise almost half of total US consumption and come from countries including Chile, Peru and Canada. The bulk of global copper refining is done in China.

Silver’s inclusion has been a concern for precious metals traders and manufacturers that rely on the material. Any tariffs on silver could wreak havoc on the metals markets because the US relies heavily on imports to meet domestic demand. Silver has wide industrial applications and is used in electronics, solar panels and medical devices.

Tyler Durden Thu, 11/06/2025 - 16:40

Does The Democrats' Chaos Strategy Work?

Authored by Victor Davis Hanson via American Greatness,

We can draw a few conclusions from an off-year election, when iconic races in blue states went, as expected, overwhelmingly Democratic.

Nevertheless, there is only a year left before the midterms. So Republicans must react to even these paltry results.

1) Democrats’ chaotic nihilism still works.

The chaos strategy causes so much turmoil, noise, and negative media coverage that the confused voting public simply cannot sort it all out. The public wishes the upheaval would just go away and often blames those with the most current authority—logically, the incumbent Trump and his administration.

2) Every day of Trump’s first year, there were either campus eruptions, Tesla firebombings, street violence against ICE, or crazy district judges’ injunctions.

The bedlam becomes force multiplied by unhinged outbursts from Democrats like AOC, Jasmine Crockett, Eric Swalwell, and the proverbial Squad.

The latest firecracker was thrown by a now Biden-like, faltering Nancy Pelosi, who recently screamed on CNN that President Trump “is just a vile creature, the worst thing on the face of the Earth.”

The public has no time to sort out all the actual causes for such mad hattery. It knows only from Democrats that the commotion is roughly correlated with “Trump.”

Note that there is never a positive Democrat “Contract with America,” since it is impossible to advance anything popular or moderate past its now firmly socialist base.

3) Democrats also use the chaos strategy to target key electoral groups.

In this week’s election, Republicans finally grasped the purpose of the pre-election shutdown.

It was designed to galvanize key constituencies to get out the vote in a low-turnout year. The lockdown was especially aimed at two groups: laid-off and unpaid government workers and entitlement recipients terrified that their checks would dry up.

Both turned out disproportionately in Virginia and New Jersey.

The Democrats are likely to resolve the shutdown soon, as the initial momentum gained by paralyzing the government is now diminishing.

The same strategy applies to the Hispanic vote that had defected in large numbers to Trump in 2024. However, this week, in many counties, the Hispanic vote shifted back toward the Democratic Party.

The truth does not get out enough that 70-80 percent of deportations are targeted at those with either criminal records or prior deportation orders.

Instead, the nonstop violent protests, the dangerous nullification threats from blue-city officials, and the slanted media coverage worked like proverbial propaganda to reduce ICE to “the Gestapo.”

Too many of the public believed that “Nazis” were hounding only law-abiding housekeepers and landscapers, who have been here for decades and only by accident forgot to make their de facto Americanness official.

Or so the successful Big Lie went—and went unchallenged.

The administration and MAGA do not talk enough about positive news of GDP growth, tolerable inflation, massive foreign investment, a calmer Middle East, or numerous miraculous ceasefires around the globe.

Instead, when there is a vacuum in self-praise, it is more easily replaced by the sensationalism of Trump’s “revenge tour” in hounding the boy scout James Comey and poor Letitia James, of taking a wrecking ball to the revered White House, or of insulting for no reason our blameless, “nice,” and gentle Canadian neighbors. The economy not culs-de-sac win elections.

4) Much of the Trump agenda, other than spectacular military recruitment and a secure border, is more long-term than instantly gratifying.

The multitrillion-dollar foreign investments may take a year or two to create jobs and spark the economy.

The deportations will take time to switch more jobs to U.S. citizens.

New gas, oil, and nuclear energy production, trimming the federal workforce, deregulating, and greenlighting AI and other new technologies will not be felt immediately.

After the summer 1984 convention, even Ronald Reagan trailed the anemic Walter Mondale in a few polls. Then the first three quarters of GDP—cumulatively over 7% growth—were digested, as the economy took off and buried Mondale by the November elections.

5) There is no longer a Democrat Party. It is now an unapologetically neo-socialist Jacobin movement.

So traditional negative advertising designed to incur scandal and shame simply does not always work. All that matters is the hard-leftist fides of a candidate—period!

Threaten a political opponent with assassination? Brag about killing his kids?

Tattoo the 3rd Panzer SS Division death’s-head insignia on your chest?

Promise to arrest a foreign head of state when he visits your city?

Boast about grabbing the “means of production.”

So what?

To the new left, this is just proof that their new candidates and voters “mean business.” They cannot be shamed—not even by mocking Charlie Kirk’s wound or hoping Trump is not so lucky a third time.

There is plenty of time for Republicans to digest these results, especially the strategy and dangerous nature of the new left, along with the mercurial moods of the swing voters—and the need to stick to the economy.

But the clock is ticking.

Tyler Durden Thu, 11/06/2025 - 16:20

Ford Mulls Scrapping F-150 Lightning After Dismal Demand, Mounting Losses

Ford is reportedly set to scrap the F-150 Lightning, once hailed by top executives as the company's "modern Model T," amid absolutely terrible demand. Production lines for the electric pickup remain paralyzed after an aluminum shortage halted operations last month.

A new Wall Street Journal report indicates that the F-150 Lightning is on the chopping block after $13 billion in EV losses since 2023. If accurate, this would make the money-losing truck America's first major EV casualty.

CEO Jim Farley previously called the F-150 Lightning "as revolutionary as the Model T," promising a truck that would democratize electric mobility just as the original Model T democratized driving. Yet how could Farley have been so wrong about the Lightning ... and did his climate-change blinders end up damaging shareholder value? It's something the board should be taking a hard look at.

Demand for the EV truck is absolutely horrendous.

Adam Kraushaar, owner of Lester Glenn Auto Group in New Jersey, told WSJ that F-150 Lightning demand is "not there." He also sells GMC, Chevy, and other brands. "We don't order a lot of them because we don't sell them."

WSJ noted, "No final decision has yet been made, according to people familiar with the discussions, but such a move by Ford could be the beginning of the end for big EV trucks." 

The big question is whether Farley and other top executives ignored red flags, such as declining orders, dealer warnings, and mounting losses on the EV truck, in their push to appease the globalist climate change cult on Wall Street. If the report is accurate, we wonder whether the board could find grounds to review his terrible EV judgment under the duty of care. 

In October, Ford sold just 1,500 Lightnings, versus 66,000 petrol-powered F-Series trucks. EV sales overall have plunged 24% year-on-year after federal tax credits expired. 

Ford shares have trended lower after the April 2022 release of the EV truck.

WSJ noted, "The company is now racing to build a compact $30,000 EV pickup."

Tyler Durden Thu, 11/06/2025 - 15:40

US Appeals Court Resurrects Trump's Attempt To Dismiss NY Criminal Conviction

Authored by Jack Phillips via The Epoch Times,

A U.S. appeals court on Thursday revived President Donald Trump’s bid to dismiss his business records criminal conviction, ruling the president can move his case out of a New York state court.

A panel on the U.S. Court of Appeals for the Second Circuit reversed an order from a lower court judge, saying the judge had “bypassed what we consider to be important issues bearing on the ultimate issue of good cause.”

The panel of judges on the appeals court signaled that it did not weigh in on the merits of Trump’s lawyers’ arguments to dismiss the conviction. His lawyers filed court papers earlier this year to try to move the case out of New York so he could seek a ruling from a federal judge on whether the U.S. Supreme Court’s ruling on presidential immunity allows him to toss last year’s Manhattan jury verdict convicting him of falsifying business records.

“We leave it to the able and experienced District Judge to decide whether to solicit further briefing from the parties or hold a hearing to help it resolve these issues,” the appeals court judges wrote.

The panel further said the lower court “should resolve Trump’s motion for leave to file a second removal notice in any particular way” and said it should “consider the motion anew in light of our opinion.”

In May 2024, a jury convicted Trump on 34 counts of falsifying business records. Trump pleaded not guilty, maintaining that it was part of a widespread attempt to subvert his 2024 presidential campaign.

Weeks after Trump’s election victory in 2024, the judge in the case sentenced him to unconditional discharge, meaning that he faced no further penalties such as fines or jail time. The conviction, however, will remain on his criminal record.

Just days before Trump was inaugurated in January, Judge Juan Merchan noted in his order that the sentence was made with considerations of Trump being elected president.

Last year, U.S. District Judge Alvin Hellerstein denied a bid from Trump’s attorneys to remove the case, prompting Trump’s appeal. The judge maintained that Trump had “not satisfied the burden of proof required to show the basis of removal.”

The petition to the U.S. appeals court is one of many appeals that Trump has filed to dismiss the criminal conviction.

Separately, Trump had filed court papers with the New York Supreme Court’s Appellate Division of the First District, appealing the criminal conviction.

“Targeting alleged conduct that has never been found to violate any New York law, the DA [district attorney] concocted a purported felony by stacking time-barred misdemeanors under a convoluted legal theory, which the DA then improperly obscured until the charge conference. This case should never have seen the inside of a courtroom, let alone resulted in a conviction,” his lawyers wrote in a filing in October.

Aside from the Manhattan case, criminal charges were also brought against Trump in Washington, Florida, and Georgia. The Washington and Florida cases, which were brought by former special counsel Jack Smith, were later dropped. The Georgia case, brought by the Fulton County District Attorney’s office, was dismissed by a state appeals court on Jan. 17, three days before Trump’s inauguration.

Tyler Durden Thu, 11/06/2025 - 15:20

China Sees Massive Demand For USD Bond Issuance, Priced In Line With USTs For First Time

As the ceasefire in the US-China trade war starts to fray at the edges (most notably in commodity export controls and tit-for-tat responses), it appears that China is having no issues whatsoever competing with the US for the world's capital.

China’s return to the dollar bond market generated enough demand to cover the deal almost 30 times over, with a $118.1 billion order book.

“It was so popular,” said Serena Zhou, senior China economist at Mizuho Securities, adding that some investors complained they weren’t allocated enough bonds.

“Although it priced on par, it will still be free money.”

China last issued dollar bonds in 2024, when it sold $2bn of debt in Saudi Arabia.

“Markets are flush with liquidity and geopolitical tensions have eased,” said David Yim, head of capital markets, Greater China and North Asia, at Standard Chartered, which was one of the bookrunners for the deal.

Most notably, The FT reports that bankers on the deal said was the first time Beijing’s borrowing costs had matched Washington’s at issuance (while we do note that Chinese dollar-denominated bonds have previously traded at a negative spread to US equivalents in the secondary market).

China’s finance ministry issued $4bn of dollar bonds in Hong Kong, with the $2bn 3-year bond paying a coupon of 3.625 per cent, on par with US Treasury equivalents, and priced to yield 3.646 per cent, compared with 3.628 per cent for 3-year Treasuries.

The $2bn 5-year bond has a coupon 0.02 percentage points above equivalent Treasuries, with a yield of 3.787 per cent, compared with 3.745 per cent for US equivalents.

Issuance was split evenly between the two bonds.

The negligible spreads over Treasuries on the new bonds were an improvement even over China’s tight prints last year, when its three- and five-year notes were priced to yield just one and three basis points over similar-maturity Treasuries.

Bloomberg reports that more than half of the bonds were placed with investors in Asia, while European accounts got a quarter.

Investors in the Middle East and North Africa were allocated 16%.

The sale comes amid a steady rebound in dollar-note sales by Chinese firms, after the country’s unprecedented property crisis and the Federal Reserve’s interest-rate hikes triggered an issuance slump.

There’s been about $90 billion of publicly-announced sales in 2025, heading toward a three-year high, according to data compiled by Bloomberg.

Tyler Durden Thu, 11/06/2025 - 15:00

UBS Liquidates Funds, Faces $500 Million Exposure To First Brands Fracas

Having already followed Deutsche Bank into the risk-transfer business, hedging its exposure to its own deals (UBS Group's asset management unit is working on a new fund that will invest in significant risk transfers, which could include deals issued by itself), the big Swiss bank, The Financial Times reports that UBS has told clients that it will wind down an investment vehicle with significant debt exposure to First Brands Group, in the first major fund liquidation following the US auto parts maker’s shock bankruptcy.

As we detailed previously, UBS O'Connor: the once iconic hedge fund associated with the only major Swiss bank left standing after the Credit Suisse collapse, has 30% of its portfolio tied to First Brands, leaving Switzerland’s largest bank grappling with a bankruptcy that has convulsed global finance.

• Overall, UBS has more than $500mn of exposure to First Brands’ debt and invoice-linked financing, across various parts of its investment arm. 

  • As the FT reported, "clients are braced for big losses after UBS O’Connor, a private credit and commodities specialist owned by the Swiss bank, revealed that 30 per cent of the exposure in one of its funds is tied to the auto parts group."

  • O’Connor recently told investors in its “Opportunistic” working capital finance strategy that the fund had 9.1% of “direct” exposure, financing facilities based on invoices First Brands’ was due to pay, and 21.4% of “indirect” exposure, based on invoices its customers were due to pay (source FT).

And now, The FT reports that, according to unidentified people familiar with the matter, UBS has told clients of its Chicago-based O’Connor subsidiary that it is liquidating several invoice finance funds, including a strategy that did not have exposure to First Brands.

“We informed investors last month that O’Connor’s Working Capital Opportunistic funds are being wound down and the majority of the funds’ assets will be monetized by the end of the year,” UBS told the Financial Times.

“As a priority, we’re taking steps to protect clients’ interests and maximize recovery of the remaining First Brands Group-related positions through the complex bankruptcy process”

UBS is reportedly aiming to monetize 70% of the O’Connor fund with First Brands exposure by the end of the year.

The FT adds that the level of exposure has sparked anger among some investors who were previously assured that the fund would not hold more than 20 per cent of assets in a single “position”.

UBS has argued that it complied with these rules, however, as 21.4 per cent of the exposure was “indirect” and split across First Brands’ various customers.

The bank is also liquidating a “High Grade” fund that invested in invoices linked to less risky companies, even though it did not have exposure to First Brands. The whole of that fund’s assets are expected to be sold by year-end, the person added. The invoice finance funds have a total of around $600mn in assets.

We suspect UBS will not be the last to liquidate funds to cover these private credit losses.

Tyler Durden Thu, 11/06/2025 - 14:20

SEC Is Probing Egan-Jones Over Its Private Credit Rating Practices

For once the SEC, perhaps having finally learned its lesson from the Global Financial Crisis, or simply because it read one too many critical pieces in the press in recent weeks, is not waiting until the credit bubble bursts to warn the raters not to engage in rating shopping. 

Bloomberg, which was the first to highlight Egan-Jones' role in rating thousands of credit ratings in the multi-trillion private credit market, reports that the Securities and Exchange Commission has been scrutinizing Egan-Jones Ratings, delving into the business practices of a leader in the fast-growing market for private-credit ratings.

Egan-Jones Ratings Co. has for years operated from a four-bedroom colonial in Haverford.​Photographer: Sarah Silbiger, Bloomberg

According to the report, SEC enforcement attorneys are "looking into whether the firm and some of its senior executives have exerted improper commercial influence on its ratings procedures, said the people, who asked not to be identified discussing the ongoing probe."

Officials in the agency’s complex financial instruments unit are involved in the investigation, the people said. The probe began during the Biden administration and has continued this year.  The regulator hasn’t accused Egan-Jones or its officials of wrongdoing as part of this probe, and it wasn’t clear how advanced the review was.

An Egan-Jones representative said the firm takes compliance “very seriously and remains in good standing with our regulator.” He added that the business “remains dedicated to serving our clients and the global capital markets.”

The SEC declined to comment, citing the ongoing US government shutdown. “During the shutdown, the SEC’s public affairs office is not able to respond to many inquiries from the press,” the agency said in a statement.

Egan-Jones is a Nationally Recognized Statistical Rating Organization, an accreditation which allows its grades to be used by US insurers to calculate their regulatory capital charges. A higher rating means an insurer has to set aside less against an asset. 

Egan Jones built a dominant position early in the rapidly expanding private credit market as bigger ratings agencies focused on serving the larger public sectors. Roughly a a third of the $6 trillion of cash and invested assets held by US life insurers was allocated to various types of private credit investments, Moody’s Ratings estimates based on a survey of insurers it rates.

Insurers will be this generation's "widows and orphans": private credit represents 35% of total US insurers' investments pic.twitter.com/ifV8CB2nrj

— zerohedge (@zerohedge) October 29, 2025

According to Bloomberg, Egan-Jones bills itself as the most prolific grader in that market and last year rated more than 3,000 private credit investments, all with about 20 analysts, prompting questions not only about rating shopping but quality control. The role that such ratings play in the industry’s boom has been in the spotlight this year, as more insurers seek to gain exposure to the private credit markets.

In a report published last month, the Bank for International Settlements said that private credit grades used by insurance companies tend to be concentrated among smaller ratings firms, raising the risk of “inflated assessments of creditworthiness.” 

Separately, Bank of England Governor Andrew Bailey recently told lawmakers he’d had conversations with industry figures who assured him that “everything was fine in their world, apart from the role of the rating agencies.” UBS Group AG Chairman Colm Kelleher said on Tuesday he’s beginning to “see huge rating agency arbitrage in the insurance business.”

Egan-Jones had attracted scrutiny from large players in the industry over its upbeat ratings of various private credit loans, Bloomberg reported in June. 

Tyler Durden Thu, 11/06/2025 - 13:45

Were We Lied To About World War II?

LIVE NOW:

https://t.co/6zrlPu4u8D

— zerohedge (@zerohedge) November 6, 2025

****************

The clip that started it all….

For the people saying Darryl Cooper didn’t say “Churchill was the chief villain” in WW2 on Tucker Carlson’s podcast, watch this.

If what he said isn’t morally and intellectually wrong, then you don’t have to lie for him. pic.twitter.com/5JgjWTZhhr

— Samuel Sey (@SlowToWrite) September 4, 2024

For those who remember, the above remarks by historian Daryl Cooper speaking to Tucker Carlson launched a debate that has transpired for over a year since: Were Churchill and FDR the good guys? Did the U.S. and UK need to get involved in a war on behalf of Poland? How might things have been different?

Tonight at 7pm ET, we will take on those questions.

The Debaters

Renowned World War II historian Jim Holland defends the mainstream view — that U.S. and British intervention was a moral necessity against fascist aggression.

Facing him is Keith Knight, Executive Editor of the Libertarian Institute, who argues the war was not inevitable nor necessary — and that the “Greatest Generation” story conceals darker motives, from FDR’s provocations to the post-war rise of the western military-industrial complex and the Soviet Union.

Moderated by Mario Nawfal, the discussion promises to challenge deeply held assumptions about Pearl Harbor, Churchill’s legacy, and whether victory came at the cost of truth itself.

Tune in live tonight at 7PM ET on X, YouTube, or right here on the ZH homepage.

Tyler Durden Thu, 11/06/2025 - 12:40

Elon Musk's Trillion-Dollar Pay-Package Faces Shareholder Vote Today; Here's What To Know

Elon Musk’s staggering $1 trillion pay package will dominate Tesla’s annual shareholder meeting today, setting up one of the most high-stakes corporate votes in years over the future of the world’s most visible CEO.

The board has made the choice explicit. Tesla Chair Robyn Denholm warned that the decision is about whether shareholders still want to “retain Elon as Tesla’s CEO and motivate him” to make the company “the leading provider of autonomous solutions and the most valuable company” on Earth.

After a Delaware judge struck down his previous $56 billion award twice, Musk has gone without any official compensation — and Tesla is now asking investors to restore a deal even larger than before.

The plan ties Musk’s payout to wildly ambitious milestones.

The package is structured in 12 tranches, each worth 35.3 million shares, tied to both market capitalization milestones and operational objectives.

The first market cap target is $2 trillion, and the final milestone is $8.5 trillion.

Operational targets include:

• Delivering 20 million vehicles over 10 years, more than double Tesla’s production over the past dozen years.

• Securing 10 million full self-driving subscriptions.

• Producing 1 million humanoid robots through Tesla’s Optimus division.

• Operating 1 million robotaxis in commercial service.

• Meeting earnings milestones in eight consecutive quarters, each measured over four quarters.

While these goals are technically achievable, Tesla has struggled to meet some recent operational benchmarks.

As BI noted Musk himself framed the stakes differently on the latest earnings call: “I just don’t feel comfortable building a robot army here and then being ousted because of some asinine recommendations.”

Proxy advisers ISS and Glass Lewis are urging a no vote, citing “excessive power” and weak oversight. Musk fired back in recent days, calling them “corporate terrorists.” But with his own roughly 13% stake and a large base of loyal retail shareholders who usually back him, supporters say the numbers are in his favor. As billionaire investor Ron Baron told CNBC, “Elon is the ultimate ‘key man’ of key man risk. Without his relentless drive and uncompromising standards, there would be no Tesla.”

Photo: Baron, CNBC

Norway’s $2 trillion sovereign wealth fund said it would vote no because of “the total size of the award, dilution, and lack of mitigation of key person risk.” Corporate governance expert Nell Minow said she’d only consider the package if Musk “shut up about politics” and focused fully on Tesla instead of juggling xAI, SpaceX, Neuralink, The Boring Company and his political campaigns.

Shareholders will also weigh Musk’s push for Tesla to invest in his AI startup xAI, which he says Tesla “would have invested in… long ago” if it were up to him. 

Meanwhile, broader concerns over governance are on the ballot — though Tesla’s board has recommended against all shareholder accountability measures, including annual director elections and reversing a Texas rule that limits which investors can sue the board. “These actions violate basic tenets of good corporate governance and must be reversed,” said New York State Comptroller Thomas P. DiNapoli.

All of this comes during a volatile year for Tesla. The company appears at a jumping off point into AI and robotics, while research suggests the company could have sold dramatically more cars without Musk’s actions outside the company. Yet shares have rebounded — up 14% this year — boosted in part by Musk’s own $1 billion stock purchase.

The outcome of the vote is expected to be announced after today’s meeting in Austin. You can watch the full meeting below, beginning at 4PM EST:

Tyler Durden Thu, 11/06/2025 - 11:20

Nancy Pelosi Finally Retiring From Congress At 85

After days of speculation, former House Speaker and legendary insider trader Nancy Pelosi (D-CA) has formally announced that she out.

In a Thursday morning video, Pelosi announced that she won't seek reelection after completing her current term.

"There has been no greater honor for me than to stand on the House floor and say, ‘I speak for the people of San Francisco.’ I have truly loved serving as your voice in Congress, and I've always honored the soul of Saint Francisco — ‘Lord, make me an instrument of thy peace.' The anthem of our city," Pelosi said in a voiceover. Which 'Lord' she was referring to is unclear. 

"That is why I want you, my fellow San Franciscans to be the first to know I will not be seeking re-election to Congress. With a grateful heart, I look forward to my final year of service as your proud representative as we go forward."

Pelosi, who has been in congress since 1987 after winning a special election to replace the late Rep. Sala Burton (D-CA), served as House speaker from 2007-2011, and then again from 2019 to 2023. 

Pelosi become one of President Trump's largest enemies over the past decade - dramatically tearing up his State of the Union speech in 2020, and refusing to allow the National Guard to deploy on Jan. 6. 

Trump cheered Pelosi's retirement announcement - telling Fox News: "The retirement of Nancy Pelosi is a great thing for America," adding that she's "evil," "corrupt," and "only focused on bad things for our country."

"She was rapidly losing control of her party and it was never coming back. I’m very honored she impeached me twice and failed miserably twice," Trump added. 

Of course, she hasn't been right for a while... this was five years ago:

Tyler Durden Thu, 11/06/2025 - 11:00

CarMax Shares Crater As Board Ousts CEO Amid Deepening Used-Car Market Cracks

CarMax shares plunged in the early cash session after the struggling used-car retailer delivered weak preliminary third-quarter results that missed Wall Street expectations, and compounded the blow by announcing the abrupt termination of its chief executive officer.

"We make car buying and selling simple, transparent, and personalized," Chair of the Board Tom Folliard stated in a press release, adding, "However, our recent results do not reflect that potential and change is needed."

Folliard was referring to preliminary third-quarter results: earnings per share forecasted between .18 cents and .36 cents, missed the Bloomberg Consensus of .69 cents

• Prelim EPS 18c to 36c, estimate 69c (Bloomberg Consensus)

• Prelim used unit sales in comparable stores -8% to -12%, estimate -3.7%

In addition to the weak preliminary earnings report, the company's board ousted CEO William D. Nash amid declining revenue...

... and stock collapse. 

The combination of today's news sent shares tumbling as much as 15%, pushing year-to-date losses to over 57%. Meanwhile, online used-car retailer Carvana has gained more than 50% so far this year.

Are CarMax's troubles a broader sign that used-car prices could tumble amid worsening consumer sentiment, with lower- and middle-income households increasingly cutting back on restaurant spending?

Let's not forget that the implosion of subprime auto lender Tricolor Holdings may have been an inflection point... 

Tyler Durden Thu, 11/06/2025 - 10:45

France's Plans To Deploy Troops To Ukraine Risk Sparking A Major Crisis

Authored by Andrew Korybko via Substack,

Russia’s Foreign Intelligence Service (SVR) reported that France is plotting to deploy up to 2,000 soldiers, the core of which will be Latino assault troops from the Foreign Legion who are presently undergoing intensive training in Poland, to Central Ukraine in the near future.

This follows Chief of Staff of the French Army Pierre Schill declaring that his country will be ready to deploy troops to Ukraine next year as part of “security guarantees”.

Putin earlier warned that any foreign troops there would be legitimate targets.

Nevertheless, SVR reported in late September that “the first group of career military personnel from France and the United Kingdom has already arrived in Odessa”, yet no crisis followed. The reason might be that neither of them confirmed their forces’ presence there, perhaps for escalation-management purposes, so they and Russia aren’t (yet?) making a big deal about any potential casualties. Up to 2,000 conventional troops, however, would be impossible to hide and thus represent a major escalation.

French President Emmanuel Macron first flirted with deploying troops to Ukraine in February 2024, but nothing came of it likely due to reluctance among his NATO allies to risk World War III with Russia. One year later, new Secretary of Defense (now War) Pete Hegseth informed the bloc that the US won’t extend Article 5 security guarantees to allies’ troops in Ukraine. Since then, reports circulated that Trump might authorize US intelligence and logistics support for precisely such a post-war deployment.

These rumors followed his Anchorage Summit with Putin and preceded the US’ latest escalation against Russia by two months, the latter of which was assessed here as being driven in part by Trump believing that he can coerce Putin into the most realistic maximum concessions possible. About that, Russia is unlikely to ever cede the disputed territories under its control since the constitution prohibits that, but it’s hypothetically possible that it could accept the deployment of Western troops to Ukraine one day.

It’s unimportant if some consider this to be a political fantasy since that doesn’t detract from the argument that Trump is formulating US policy towards the Ukrainian Conflict with this scenario in mind. Whether this potentially French-led force would deploy during hostilities or only afterwards is a subject of debate, not to mention whether any such force would ever deploy there at all, but France remembers what Hegseth said in February and therefore probably wouldn’t do so unilaterally without US approval.

Accordingly, it should be assumed that Trump is aware of Schill’s declaration of intent about next year’s possible deployment to Ukraine and Macron’s potential plans to deploy assault troops even sooner but at the very least didn’t object, perhaps even encouraging this as leverage over Putin (as he might see it).

If so, then Putin must decide whether to reach a deal with Trump over this for escalation-management purposes or climb the escalation ladder by authorizing strikes against those troops if they deploy there.

It was predicted here in late September after SVR’s report about French and UK troops in Odessa that “Direct Western intervention in the conflict is now arguably turning into a fait accompli, it’s just a question of how Russia will respond and whether the US will then be pulled into mission creep.”

The two latest news items confirm the accuracy of that analysis, which lends credence to the overall assessment that Trump is “escalating to de-escalate” on better terms for the West and worse ones for Russia.

Tyler Durden Thu, 11/06/2025 - 10:25

Yields Plunge After Private Tracker Shows US Lost 9K Jobs In October, Driven By Government Collapse

One month ago, when the market was freaking out by the lack of official government data (it has since realized again, that whether the government is open or closed, or what the jobs number is - certainly not until it is revised 3 or 4 times, does not matter), everyone scrambled to find private sources of economic data. That's when the jobs data compiled by Revelio Labs quickly emerging as one of the favorites. It also showed that contrary to fears prompted by ADP that the US was now in a labor recession, in September the US actually added 60K jobs, the biggest monthly increase of 2025.

Fast forward one month when the news was far uglier: according to the latest Revelio Labs data, not only was Sept revised almost 50% lower from 60K to 33%, but October was ugly, plunging to -9,100, the second worst print of 2025, and the second worst on record (Revelio only goes back to 2021).

Looking below the surface revealed that the actual number is not quite as bad as the entire drop and then some was the result of 22,210 government job losses, but there also losses in manufacturing and trade. 

Coupled with the surge in government layoffs noted earlier as tracked by Challenger...

... and suddenly rate cut odds are spiking, with 0.69 rate cuts priced in for December, up from 0.62 yesterday.

The data has resulted in a broad-based risk off move, with stocks sliding to session lows, and 10Y yields tumbling 5bps to session lows below 4.10%

Tyler Durden Thu, 11/06/2025 - 10:10

"There's A Plan": Group Of Centrist Democrats Want Colleagues To End Shutdown

A group of eight centrist Democrats who want to end the government shutdown - now the longest in US history - have been approaching their colleagues about a deal to reopen the federal government this week or next week, however progressives within the party are pushing back hard, according to The Hill, citing people familiar with the discussions.

To refresh your memory, the crux of the shutdown is that Democrats want to extend pandemic-era Obamacare enhancements, which include coverage for illegals - and they're unwilling to kick the can down the road with a "clean" (free of new pork) continuing resolution while congress debates a larger package (again).

According to one senator, the centrist Democrats include Sens. Jeanne Shaheen (D-NH) and Gary Peters (D-MI) - and apparently have the 'contours of a deal' and are "whipping" more of their colleagues to sign on. 

Sen. Maggie Hassan (D-NH) has reportedly signaled that she would likely support such a deal, which would include a plan to pass regular appropriations bills, as well as a vote on extending expiring health insurance subsidies (which were always meant to be temporary during the pandemic). 

The deal would also create a path for approving an appropriations package to fund part of the federal government through 2026, and would guarantee Democrats a vote in the Senate on extending the enhanced Obamacare provisions.

"There’s a plan, we’ve all kind of semiagreed to it and we’re now seeing not whether [Senate Democratic Leader Chuck] Schumer will support it but whether he will not blow it up," one senator told the outlet. 

Senate Democrats met for more than two hours at lunch Tuesday to discuss the parameters of the emerging deal.

One person familiar with Tuesday’s heated discussion within the caucus says there appears to be at least eight Democratic votes to reopen the government — even though progressive Democratic senators vented their frustration with the potential deal. -The Hill

"To me, it looked like there were eight votes, but it could change. There’s a lot to think about," one senator told the outlet. 

If Shaheen, Peters and Hassan do vote for a short-term spending deal, GOP leaders would only need two more votes to reopen the government. 

That said, since Rand Paul (R-KY) has repeatedly voted against a House-passed continuing resolution to fund the government through Nov. 21, and GOP leaders will need eight Democrats to cross the aisle. 

They've already got the support of Sens. John Fetterman (D-PA) and Catherine Cortez Masto (D-NV) and Angus King (I-ME), who have all repeatedly voted in favor of the bill.

Other Democrats who have been involved in talks with Shaheen and Peters are Sens. Jon Ossoff (D-Ga.), who faces a competitive reelection next year, and Sens. Mark Kelly (D-Ariz.), Peter Welch (D-Vt.), Tammy Baldwin (D-Wis.) and Elissa Slotkin (D-Mich.).

Slotkin, however, signaled to reporters Tuesday that she wants to see a solution to rising healthc are costs as part of any agreement to fund the government.

“When there’s a deal and we get something on health care, I’ll be ready to reopen the government,” she said.  -The Hill

Yet, progressives want Senate Democratic leader Chuck Schumer (D-NY) to 'use his personal influence' to dissuade the coalition of centrist Dems from reopening the government. 

Of note, Senate Majority Leader John Thune (R-SD) said that any proposal that would extend Obamacare subsidies would need 60 votes in the Senate - ruling out the possibility of passing such a provision with a simple-majority vote. 

Meanwhile, 47% of Polymarket bettors think we're in for another 10 days of this, minimum. 

Tyler Durden Thu, 11/06/2025 - 09:55

Mamdani Announces All-Female Transition Team, Including Lina Khan

Authyored by Joseph Lord via The Epoch Times,

New York City Mayor-elect Zohran Mamdani announced on Wednesday that his transition team would be all-female.

“Last night we made history, and today we begin the work of making a new administration,” Mamdani said in a video posted to X.

Following Mamdani’s substantial victory in the city’s mayoral election on Nov. 4, outgoing New York City Mayor Eric Adams will begin handing off power to the mayor-elect’s incoming administration.

Mamdani said that during the transition period, his team would work to “build a City Hall that delivers on the promises of our campaign: to make New York City affordable, and to make it accountable to the people it serves.”

Several of the women announced on Mamdani’s transition website as co-chairs of the transition team are Democratic Party insiders, particularly within New York City politics.

Mamdani said these figures were chosen on the basis of “excellence, integrity, and a hunger to solve old problems with new solutions.”

Members of the transition team include former Federal Trade Commission Chair Lina Khan, former first deputy mayor Maria Torres-Springer, United Way of New York City head Grace Bonilla, former deputy mayor for health and human services Melanie Hartzog, and political consultant Elana Leopold.

Mamdani, a self-described democratic socialist candidate whose bid to lead America’s largest city drew national attention, has garnered over 50 percent of the vote in the race with 93 percent of the votes counted.

He defeated the leading rival for the post, former New York Gov. Andrew Cuomo, a Democrat who ran an Independent campaign, and Republican nominee Curtis Sliwa.

Mamdani ran as a political outsider, drawing huge crowds and grassroots support while obtaining limited backing from establishment figures in the Democratic Party, which had nominated him for the job, for his progressive platform.

Left-wing figures such as Rep. Alexandria Ocasio-Cortez (D-N.Y.) and Sen. Bernie Sanders (I-Vt.) were outspoken in favor of Mamdani’s bid.

Meanwhile, top party figures in Washington were more hesitant.

House Minority Leader Hakeem Jeffries (D-N.Y.) gave Mamdani his endorsement only near the end of the race, but he has stated that he doesn’t believe Mamdani is the future of the Democratic Party.

Senate Minority Leader Chuck Schumer (D-N.Y.), meanwhile, never provided an endorsement in the race.

Mamdani’s election also sets the stage for a potentially adversarial relationship with the federal government.

The mayor-elect vowed during his campaign that he would attempt to “Trump-proof” New York, including through opposition to Immigration and Customs Enforcement (ICE) activity in the city.

During an interview with Fox News’s Brett Baier on Nov. 5, President Donald Trump said:

“I’m so torn, because I would like to see the new mayor do well, because I love New York. I really love New York.”

Trump repeated his position that Mamdani is a “communist” whose policies won’t work.

When asked whether he had reached out to the mayor-elect, Trump said Mamdani should reach out to him.

“I think he should be very nice to me. You know, I’m the one that sort of has to approve a lot of things coming to him,” Trump said. “He has to be a little bit respectful of Washington, because if he’s not, he doesn’t have a chance of succeeding.”

Tyler Durden Thu, 11/06/2025 - 09:35

October Layoffs Surge Most Since 2003 Amid Cost-Cutting, AI Adoption, Challenger Data Shows 

The U.S. labor market weakened considerably in October, with companies slashing 153,000 jobs, nearly triple last year's total and the highest for that month since 2003, according to a new report from outplacement firm Challenger, Gray & Christmas.

Technology and warehousing jobs led the layoffs, mostly because companies are slashing folks who were hired during the pandemic-era overhiring period. Also, slowing consumer demand and rising costs are other contributing factors. Year-to-date job cuts have surpassed 1 million, the highest since 2020, while announced hiring plans are at their lowest level since 2011.

"October's pace of job cutting was much higher than average for the month. Some industries are correcting after the hiring boom of the pandemic, but this comes as AI adoption, softening consumer and corporate spending, and rising costs drive belt-tightening and hiring freezes. Those laid off now are finding it harder to quickly secure new roles, which could further loosen the labor market," said Andy Challenger, chief revenue officer for Challenger, Gray & Christmas.

Challenger continued, "This is the highest total for October in over 20 years, and the highest total for a single month in the fourth quarter since 2008. Like in 2003, a disruptive technology is changing the landscape."

"Over the last decade, companies have shied away from announcing layoffs in the fourth quarter, so it's surprising to see so many in October. With the onset of social media, and the ability for workers to share their negative experiences with their employers, the trend of announcing layoffs before the holidays fell away, a practice that seemed particularly cruel," he said.

U.S. employers announced 153,074 job cuts in October, a 175% increase from a year ago and 183% higher than September. This is the worst October since 2003 and the biggest fourth-quarter total since 2008. 

Source: Bloomberg 

Which industries cut the most in October? 

• Technology: 33,281 cuts in October (up from 5,639 in September); 141,159 YTD (+17% y/y).

• Warehousing: 47,878 cuts (up from 984); 90,418 YTD (+378% y/y) — signaling automation and excess capacity post-pandemic.

• Retail: 2,431 cuts (slightly down m/m); 88,664 YTD (+145% y/y).

• Consumer Products: 3,409 cuts; 41,033 YTD (+21% y/y).

• Nonprofits: 27,651 cuts YTD (+419% y/y) amid federal funding losses and cost pressures.

• Media: 16,680 cuts YTD (+26% y/y); News subset: 2,075 cuts YTD (down 41% y/y).

Reasons for the cuts:

• "DOGE Impact" remains the leading reason for job cut announcements in 2025, cited in 293,753 planned layoffs so far this year. This includes direct reductions to the Federal workforce and its contractors. An additional 20,976 cuts have been attributed to DOGE Downstream Impact, which reflects the loss of federal funding to private and non-profit entities.

• In October alone, Cost-Cutting was the top reason employers cited for job reductions, responsible for 50,437 announced layoffs. Artificial Intelligence (AI) was the second-most cited factor, leading to 31,039 job cuts as companies continue to restructure and automate. AI has been cited for 48,414 job cuts this year.

• Market and Economic Conditions accounted for another 21,104 cuts in October, bringing the year-to-date total for this reason to 229,331, while Closings of stores, units, and plants resulted in 16,739 cuts for the month and 161,391 for the year. Restructuring was cited in 7,588 October announcements, for a total of 108,038 so far in 2025.

• The Midwest logged 351 CEO exits year-to-date, up 6% from 332 in 2024. Illinois led the region with 72 CEO departures, compared to 57 last year. Indiana nearly doubled to 38 from 20, and Iowa rose to 23 from 11. Meanwhile, Ohio declined slightly to 61 from 71, and Michigan dropped to 29 from 41

Challenger data shows that the hiring outlook for the full year and in October darkened:

• Planned hires: 488,077 YTD (down 35% y/y) - the lowest since 2011.

• Seasonal hires: 372,520 through October - the weakest since 2012.

• Challenger expects no strong holiday hiring rebound, despite possible rate cuts.

The takeaway is that the labor market was already softening by late summer, as cost-cutting reshaped corporate labor structures amid the need to correct overhiring from the pandemic era in the era of increasing AI adoption. This is a clear sign of continued loosening in the labor market, in stark contrast to the Fed's "gradual cooling" narrative.

And if the Challenger data is correct, the labor market has shifted into a low-hiring, high-firing regime, an unsettling development that could spell bad news for the economy.

This data may only suggest stronger views for a December interest rate cut. Goldman thinks so (read the report).

JPMorgan analyst note, "The market is weighing a weaker labor market and potential spending vs. evidence on the efficacy (and ROI) of AI plus productivity gains." 

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

If Solar And Wind Are Now Cheaper Than Fossil Fuels, Why Don't We Have More?

Authored by Mike Shedlock via Mish Talk,

The answer is they aren’t cheaper...

Energy Talking Points

Substack writer Alex Epstein has a great post on The “Levelized Cost of Energy” Scam.

If you ever hear anyone favorably compare solar and wind to coal, gas, or nuclear by citing a low LCOE—“Levelized Cost of Energy”—you are being scammed.

You’ve heard it over and over: “Solar and wind are now cheaper than fossil fuels.”

You might suspect something is wrong here, because if solar and wind were so cheap their developers wouldn’t always be asking for subsidies, or claim the sky is falling when subsidies are taken away.

The suspicious claim that “Solar and wind are now cheaper than fossil fuels” is usually justified using an intimidating-sounding metric called LCOE: “Levelized Cost of Energy.”

In a 2020 report, the International Energy Agency used LCOE to claim that “renewable” energy costs are now “competitive” with fossil fuel costs, and that onshore wind is the cheapest source of electricity in most countries.

In a 2023 article titled “The Clean Energy Future Is Arriving Faster Than You Think,” the New York Times used LCOE to claim that solar and wind are somehow cheap while coal, gas, and nuclear are somehow expensive.

LCOE absurdly equates the value of reliable electricity and unreliable electricity

• Imagine there were a metric called LCOB—Levelized Cost of Babysitters—that compared the cost of different babysitters in your neighborhood.
  
  But there was a catch that made it useless: the organization collecting the metric allowed totally unreliable babysitters to qualify.
• Imagine that unreliable babysitters sold themselves by saying: We have the cheapest LCOB—we only charge $15/hour, while reliable ones charge $20.
  
  Obviously that would be a scam because in practice if you pay for an unreliable babysitter you also need to pay for a reliable one.
• Whether you’re comparing babysitters or sources of electricity, reliability is table stakes.

And yet LCOE—Levelized Cost of Electricity—popularized by the firm Lazard, explicitly excludes “reliability-related considerations”

• By allowing unreliable electricity to qualify as “electricity” or “energy,” LCOE wildly understates the cost of solar and wind. In reality, solar and wind need life support from reliable sources.
  
  The cost of using them is the full system cost, including life support cost.
• The full life-support cost of solar and wind includes the dispatchable power plants that accommodate solar and wind’s unreliability—and the high-density long-distance transmission wires needed to connect faraway solar and wind to nearby grids—and various grid-stabilizing expenses.
• Solar and wind’s life-support costs are large and increase with the percentage of solar and wind use.

References

New York Times – The Clean Energy Future Is Arriving Faster Than You Think

Guardian – Wind power is cheapest energy, EU analysis finds

IEA – Projected Costs of Generating Electricity 2020

Lazard – LCOE Report 2021

If Wishes Were Fishes

All of the above are scams.

If wind and solar were cheaper they would not need subsidies and we would have more wind and solar power.

Q: But isn’t China expanding solar?

A: Yes, but China does not care about costs, has a perfect high altitude location, and is not subject to ridiculous US tariffs on solar panels.

Hydropower may be cheaper. And China is again a perfect example.

Hydropower Electricity

On July 23, 2025, SCMP reported China is building the world’s biggest hydropower dam.

On the eastern rim of the Tibetan plateau, China envisions a future powered by the roaring waters of the Yarlung Tsangpo, also known as the Brahmaputra. The river will be the site of a mega dam – the world’s most ambitious to date – that promises to bring clean energy, jobs, infrastructure and prosperity to the region.

How big is the mega dam?

The dam will be situated in the lower reaches of the Yarlung Tsangpo, where a section drops 2,000 metres (6,562 feet) over a 50km (31 miles) stretch, creating immense hydropower potential. The dam is reportedly located in Medog, a remote county in the city of Nyingchi in the Tibet autonomous region.

When completed, the project will overtake the Three Gorges Dam as the world’s largest hydropower dam. It could generate three times more energy with five cascade hydropower stations – an estimated annual capacity of 300 billion kilowatt-hours (kWh) of electricity, more than Britain’s total annual power output.

It is estimated to cost around 1.2 trillion yuan (US$167 billion), dwarfing many of the biggest infrastructure undertakings in modern history at around five times the cost of the Three Gorges Dam and even more expensive than the International Space Station.

But not all hydropower is unproblematic. Lake Powell and Lake Mead in the US are problem examples.

Dams silt up, US water rights are an issue, and water replenishment is an issue. The Brahmaputra damn has none of those issues.

I discussed hydropower on October 27 in Why China Is On a Pace to Win the AI Race

China has three big advantages over the US: cheap electricity, an open source model, and fewer capital needs.

Electricity Costs Are Soaring and AI Will Make Matters Worse

Please note Electricity Costs Are Soaring and AI Will Make Matters Worse

Electricity demand for AI data centers is soaring. The result won’t be pretty.

We should take advantage of cheap hydropower in Canada and be grateful for Canada’s ability to produce steel and aluminum cheaper than we can.

Instead, Trump proposes to make aluminum, copper, and steel manufacturing great again with 50 percent tariffs.

Tyler Durden Thu, 11/06/2025 - 08:45

Stocks Rebound To Session Highs After Soaring Corporate Layoffs Raise Rate Cut Odds

US equity futures are higher, rebounding from session lows for the second day in a row, amid headlines that layoffs are surging due to AI which in turn is raising odds of a Dec rate cut, with JPM saying that "the market is weighing a weaker labor market and potential spending vs. evidence on the efficacy (and ROI) of AI plus productivity gains." Challenger job cuts jumped to over 150K in October, nearly triple the year-earlier period and the most in more than two decades. As of 8:00am ET, S&P futures are 0.2% higher ahead of the last major earnings day of a season that’s delivered stellar results; Nasdaq futures are also up 0.2%, with Semis catching a bid driven by MRVL (+11%, takeover chatter) and NVDA (up +1.4% after yesterday’s roll on the OpenAI govt backstop headlines). TSLA rose 0.5% ahead of a vote on granting Elon Musk a potential $1 trillion pay package. In the premarket, cyclicals look flat to Defensives, while commodity-related plays are bid. The commodity complex is higher led by Energy and Metals. Asia closed higher (Shanghai +97bps/Hang Seng +2.12%/Nikkei +1.34%) driven by strength in growth/tech/ai names, while Europe is down small (FTSE -25bps/DAX -10bps/CAC -45bps). US 10 year yield down small at 4.13% on quiet macro news as the curve bull steepens, and the USD is weaker. The macro data focus is on Challenger Job Cuts which soared to 153,074K, the highest for October since 20023, and state-level initial jobless claims. Today also brings another heavy dose of earnings (pre-open we get APD, BDX, CMI, COP, H, PENN, PH, RL, ROK, TPR...post-close we get AKAM, CE, EXPE, MCHP, SNDK, TTWO, WYNN), a handful of Fed speakers, the BOE rate decision and TSLA’s annual meeting (which includes voting on Musk’s pay package). Markets also digest the likelihood of the Supreme Court striking down Trump’s IEEPA tariffs after oral arguments yesterday (Goldman expects a ruling in Dec of Jan ’26 // GIR full take).

In premarket trading, Mag 7 stocks are mixed: Tesla (TSLA) +0.6% after the deadline for investors to vote on Elon Musk gargantuan compensation plan expired at midnight (Nvidia +1.4%, Meta +0.8%, Alphabet +0.7%, Apple -0.2%, Amazon -0.03%, Microsoft -0.1%).

• CarMax (KMX) falls 11% after the used car retailer’s board terminated the employment of CEO Bill Nash.
• Coherent (COHR) soars 18% after the semiconductor device company’s results and forecast underlined AI tailwinds.
• DoorDash (DASH) falls 11% after its forecast for fourth-quarter adjusted Ebitda fell short of the average analyst estimate at the midpoint.
• Duolingo (DUOL) is down 23% after the language-learning software company gave a weak fourth-quarter bookings forecast. Analysts note that the management’s focus on user growth weighs on the bookings outlook.
• Elf Beauty (ELF) sinks 21% after the cosmetics company’s full-year outlooks for adjusted earnings per share and net sales both missed analysts’ estimates.
• Fastly (FSLY) jumps 19% after the software company’s results and raised full-year revenue forecast showed a strong growth recovery.
• HubSpot (HUBS) falls 10% after the software company reported its third-quarter results and gave an outlook.
• LegalZoom.com (LZ) rises 27% after the legal services company gave an outlook that is seen as reinforcing positive growth trends, prompting William Blair to upgrade the stock.
• Marvell (MRVL) is up 8% as people familiar say that SoftBank Group Corp. explored a potential takeover of the US chipmaker earlier this year.
• Papa John’s (PZZA) falls 7% after the pizza company reported adjusted earnings per share for the third quarter that missed the average analyst estimate.
• Qualcomm Inc. (QCOM) falls 1.8%, becoming the latest chipmaker to deliver an upbeat forecast and still leave investors underwhelmed.
• Snap (SNAP) surges 19% after the company announced a $400 million partnership with Perplexity AI Inc. to incorporate its AI-powered search engine into Snapchat.
• Stagwell Inc. (STGW) soars 80% after announcing a partnership with Palantir.

Trading this week has been marked by a pullback in the biggest beneficiaries of the artificial-intelligence race, which have powered much of this year’s rally, before dip-buyers stepped in to offer support. Corporate America has continued to deliver robust results, with 82% of the 413 S&P 500 companies reporting this quarter beating earnings expectations, 14% have missed. 

“You stay sane by trying to stay long-term,” Carmignac fund manager Obe Ejikeme told Bloomberg TV. AI “is a megatrend and will pay off over the next five to ten years, no doubt about that. But staying sane is not putting all your eggs in that basket.”

Price action divergence to results continues, even within AI-related momentum sectors. Qualcomm became the latest semiconductor firm to deliver an upbeat forecast that failed to impress investors, while ARM rose on a bullish outlook pointing to an AI chip demand surge.  Meanwhile, semiconductors remain top of mind: Softbank had explored acquiring Marvell earlier in the year to combine it with ARM, in what would have represented the largest semiconductor deal in history. Open AI’s CFO suggested the market should have more ‘exuberance’ for AI’s potential, while hinting the US government could backstop AI financing. 

Caution over lofty tech valuations that weighed on markets earlier in the week continued to linger. Qualcomm, the biggest maker of smartphone chips, became the latest semiconductor firm to issue an upbeat forecast that failed to impress investors, sending its shares 1.8% lower. 

Treasuries rebounded after the latest Challenger job cuts jumped to over 150K in October, nearly triple the year-earlier period and the most for the month in more than two decades. YTD job cuts have exceeded 1M, the most since the pandemic. The yield on 10-year notes fell two basis points to 4.14%, while the dollar headed for its biggest drop in three weeks.

Traders will also weigh the implications of the US Supreme Court hinting it is ready to put significant limits on Trump’s far-reaching agenda, adding to uncertain sentiment. US layoffs remain a focus too, with October seeing the most job cuts in more than two decades. US shutdown impact is spreading to aviation with plans to cut flight capacity by 10% at 40 high-volume markets to alleviate pressure on air traffic controllers. 

Following days of mixed signals from Fed officials and scant economic data during the longest US government shutdown in history, investors will also closely watch a slate of policymaker speeches Thursday for clues on the interest-rate outlook. The Bank of England held interest rates at 4% in a five-to-four vote that laid the groundwork for a December cut. The pound pared gains of as much as 0.4% against the dollar. Gilts rose across the curve, with the two-year yield down three basis points to 3.76%.

Traders have gradually trimmed bets on a quarter-point rate cut next month to around 50% over the past week, before the job-cuts report from outplacement firm Challenger, Gray & Christmas Inc. bumped those odds back up to 60%. Still, “the overall nudge pressure is up for yields,” wrote Padhraic Garvey and Michiel Tukker at ING. “This, of course, partly reflects the ‘driving in the fog’ metaphor for the government shutdown, but also with a dose of inflation concern and a pinch of risk-on ebullience.”

Europe's Stoxx 600 is down 0.2% with construction underperforming and miners rising. Legrand shares sank as demand for data center infrastructure started to ebb. The construction and insurance sectors are among the biggest laggards, while mining and telecom shares outperform. Here are some of the biggest movers on Thursday:

• Novo shares rise as much as 3.9% after a judge denied Pfizer’s request to temporarily block the Danish drugmaker’s $10 billion bid to acquire the obesity startup Metsera, saying the US pharmaceutical company’s objections to the deal don’t warrant a delay.
• Rheinmetall shares rise as much as 3.1% after the German defense firm maintained its guidance for the full year in a move Bernstein said could reassure investors who had expected a softer quarter.
• Sainsbury shares rise as much as 1.7% as the British retailer increased its full-year profit guidance to exceed the £1 billion set out in previous updates.
• Deutsche Post shares gain as much as 6.7% after the logistics company reported earnings well ahead of expectations, a performance analysts say was aided by its tight cost control.
• Novonesis shares jump as much as 8.2% after the Danish maker of industrial enzymes reported better-than-expected organic sales growth for the third quarter and lifted the bottom of its forecast range for the full year.
• Adecco climbs as much as 11% after third-quarter results which analysts view as “strong across the board.”
• DiaSorin falls as much as 16% after the Italian medical-diagnostics company lowered its guidance for the year and delivered third-quarter results below expectations.
• Legrand drops as much as 13% after its third-quarter missed expectations and full-year guidance was left unchanged.
• Air France-KLM shares slide as much as 14%, the steepest drop in three years. The airline group reported a miss on Ebit in the third quarter, driven by lower-than-expected unit revenue.
• HelloFresh shares fall as much as 15% after Grizzly Research published a report on the meal-kit company.
• Wise shares drop as much as 9.9%, slumping to a seven-month low, after the payments company reported a sharp drop in underlying pretax profit in the first half.
• Teleperformance drops as much as 8.6% after lowering its guidance for the full year, citing “an increasingly volatile business environment.”
• Worldline shares lost as much as 12%, erasing an earlier advance, after the digital payment company announced a share sale and provided a weak outlook for 2026.
• Maersk shares fall as much as 7.5% after the Danish shipping giant reported its latest earnings.

Earlier, Asian stocks climbed the most in over a week, as dip buyers lifted technology shares after a two-day selloff. The MSCI Asia Pacific Index rose 1.2%, its biggest advance since Oct. 27, with TSMC, Tencent and SK hynix among the key boosts to the gauge’s gain. Shares advanced in Hong Kong, Japan and South Korea. Indian stocks were steady.  The rebound underscores investors’ continued confidence in the long-term potential of artificial intelligence, even as concerns over stretched valuations and market concentration linger. The risk-on sentiment was also helped by the positive mood from Wall Street as dip-buyers emerge. 

In FX, the dollar is weaker following the surprise release of Challenger job data, showing the worst October for cuts since 2003. Krone is the strongest G-10 currency after Norges Bank kept rates on hold and reiterated the pace of reductions will be slow. Sterling higher, gilts slightly underperforming ahead of the Bank of England decision, also expected to be a hold.

In rates, yields are 2bp-3bp lower across the curve led by intermediates, with 5s30s spread steeper by around 1bp supported by soft job cuts data and gains for gilts after Bank of England’s 5-4 decision to hold rates at 4%, with dissenters preferring a cut. US 10-year yields near 4.12% is about 4bp lower on the day; UK counterpart had a steep 3bp drop after Bank of England rate announcement.

In commodities, gold prices rising and back above $4,000/oz. Oil prices jumping too, with Brent futures up 0.7% and about $64/barrel.

Looking to the day ahead, the main highlight will be the Bank of England’s latest policy decision. There’s also plenty of speakers, including ECB Vice President de Guindos, the ECB’s Kocher, Schnabel, Villeroy, Nagel and Lane, along with the Fed’s Williams, Barr, Hammack, Waller and Musalem. On the data side, we’ll get German industrial production and Euro Area retail sales for September. The US economic calendar — including 3Q preliminary productivity and unit labor costs, weekly jobless claims and September wholesale trade — will be empty again as US government data continue to be postponed by the govt shutdown. ConocoPhillips, DataDog, Ralph Lauren and Warner Bros Discovery are among companies expected to report results before the market opens. Conoco is expected to post its worst third-quarter profit in four years amid lower crude prices brought on by higher output globally. 

Market Snapshot

• S&P 500 mini +0.2%,
• Nasdaq 100 mini 0.2%,
• Russell 2000 mini +0.1%
• Stoxx Europe 600 little changed,
• DAX little changed,
• CAC 40 -0.4%
• 10-year Treasury yield -2 basis points at 4.14%
• VIX little changed at 17.97
• Bloomberg Dollar Index -0.1% at 1223.31,
• euro +0.2% at $1.1515
• WTI crude +0.7% at $60.01/barrel

Top Overnight News

• US companies announced the most job cuts for any October in more than two decades as artificial intelligence reshapes industries and cost-cutting accelerates. Companies last month announced 153,074 job cuts, nearly triple the number during the same month last year. BBG
• 8 centrist Democrats in the Senate could be prepared to vote in favor of reopening the government, but they are receiving pushback from more progressive corners of the party. The Hill
• Senate Democrats ended their workday Tuesday agonizing over what to do about the record-setting government shutdown. Many of those same lawmakers woke up Wednesday morning ready to fight on following Tuesday’s party success. The sweeping democratic gains in this week’s election has bolstered party senators insisting democrats dig in and force Republicans to accede to their demand for an extension of key health insurance subsidies. Politico
• Trump and Hill Republicans are now in completely different places on the political impacts of this seemingly endless shutdown: Punchbowl
• Trump said regarding the US shutdown, that it was a big factor in elections, while he does not think Democrats will act soon on the shutdown, and does not think it will be sorted soon. Trump reiterated the call to kill the filibuster and reopen the government immediately.
• The US Supreme Court appeared skeptical of Donald Trump’s sweeping tariff powers, with some justices suggesting he’d overstepped his authority. Yet even if the duties are struck down, the president has other legal options, leaving companies and countries in limbo. BBG
• President Trump has recently expressed reservations to top aides about launching military action to oust Venezuelan President Nicolás Maduro, fearing that strikes might not compel the autocrat to step down. WSJ
• U.S. Transportation Secretary Sean Duffy said on Wednesday that he would order a 10% cut in flights at 40 major U.S. airports, citing air traffic control safety concerns as a government shutdown hit a record 36th day. RTRS
• China has issued dollar bonds at rates equivalent to US Treasury yields, in what bankers on the deal said was the first time Beijing’s borrowing costs has matched Washington’s. the bond offering is the latest example of countries taking advantage of being able to issue international debt cheaply, as their borrowing costs in relation to US Treasuries fall to some of the lowest levels on record. FT
• Japan’s underlying wage growth remained steady in September, keeping the BOJ on track for policy tightening. One of Japan’s largest labor union groups said it plans to push for a 6% pay bump next year. BBG
• The Bank of England held interest rates at 4% in a five-to-four vote that laid the groundwork for a December cut. The pound pared gains of as much as 0.4% against the dollar. Gilts rose across the curve, with the two-year yield down three basis points to 3.76%: BBG
• The Fed finalized new standards for grading large banks and said that the new large bank supervisory standards are substantially similar to changes proposed in July.

Trade/Tariffs

• China bought two cargoes of around 120,000 tons of US wheat for December shipment, according to traders cited by Reuters. It was also reported that the US Grains and Bioproducts Council Chairman said a US sorghum shipment was sent to China last week.
• Japanese PM Takaichi said Japan will consider specific ways for Japan and the US to advance cooperation in the development of rare earth mining in waters around Minamitori Island.
• Chinese Commerce Ministry, on semiconductor flows, says China is committed to stability and security of global chip industry; will approve relevant export license applications of qualified Chinese exporters.

A more detailed look at global markets courtesy of Newquawk

APAC stocks were higher as the region took impetus from the rebound on Wall St, where all major indices gained amid dip buying and following stronger-than-expected ADP and ISM Services data releases. ASX 200 eked mild gains amid strength in miners, but with the upside limited as the top-weighted financials sector lagged after Big Four bank NAB reported a decline in full-year profit. Nikkei 225 rebounded from the prior day's selling and briefly reclaimed the 51,000 level before paring some of its gains. Hang Seng and Shanghai Comp benefitted from the improving US-China trade ties after China’s Commerce Ministry suspended the unreliable entity list announced in April and adjusted its export control lists, while there were comments from US President Trump who reiterated that Chinese President Xi is a good friend.

Top Asian News

• Japanese PM Takaichi looks to finalise an economic stimulus package to address inflation by late November and pass a supplementary budget to fund it, with some in the government eyeing a cost of over JPY 10tln, according to Nikkei.
• Japan Innovation Party co-leader Fujita said an early BoJ rate hike may give a mixed signal to businesses, while he added it is not a time for BoJ moves that have a big impact and they will not raise taxes to fund an earlier defence budget jump.
• One of Japan's largest labour unions, UA Zensen, is reportedly planning to push for a 6% wage hike for regular workers in next year's talks, according to Bloomberg.

European bourses (STOXX 600 -0.2%) opened modestly lower and have traded with a negative bias throughout the European morning. Nothing really behind the sentiment today, but with traders mindful of looming US data and the BoE policy decision. European sectors are mixed; Banks take the top spot, joined closely by Retail and then Real Estate. To the downside, Construction & Materials lags, followed by Insurance. In terms of key movers; AstraZeneca (U/C, strong headline metrics), Maersk (-5.2%, strong Q3 metrics but faces "challenging" 2026), Commerzbank (-2.5%, boosts outlook but Net Income not so strong).

Top European News

• ECB's Schnabel says quantitative normalisation is proceeding smoothly, with strong liquidity positions of banks and abundant excess liquidity; on new structural portfolio, says factors suggest tilting the structure towards shorter-dated assets. "policy stance neutrality, the need to maintain policy space and considerations related to financial soundness are important factors that will guide the maturity of assets the ECB will buy under a new structural securities portfolio. These factors suggest tilting the structure towards shorter-dated assets."
• ECB's de Guindos states slight optimism on growth; adds that inflation news is positive. More optimistic on services inflation. Evolution of wages are fully aligned with projections. The level of uncertainty is huge. Comfortable with the current level of rates. Undershooting of inflation will be temporary. No discussion on modifying QT.
• Norges Bank keeps rates unchanged at 4.00%, as expected; Governor Bache says, "The job of overcoming inflation is not complete, and we are in no hurry to lower interest rates".

FX

• DXY is softer following rangebound trade, with a surprise early release of the US Challenger job cuts data prompted a cleaner breach back under 100.00, with the current intraday range between 99.89 - 100.11, and compared to yesterday's 100.06-100.36 range. Challenger October US Job Cuts jump 175.3% to a 7-month high at 153.074k (prev. 54.064k in September), according to Bloomberg. The release led to some upside in T-note futures and downside in the USD. On the tariff front, the US Supreme Court yesterday sharply questioned President Trump’s broad use of emergency powers to impose global tariffs, although this risk event is likely to be a slow burner, touted to end in Q1/Q2 2026, while ING's baseline is that tariffs will stay regardless of the ruling.
• EUR is slightly firmer against the USD, largely amid USD weakness, whilst little action was seen following a variety of comments from ECB's Schnabel and de Guindos, and largely pessimistic Construction PMI. EUR/USD resides in a 1.1490-1.1524 intraday range, with traders also cognizant of the converging 50 DMA (1.1670) and 100 DMA (1.1664).
• USD/JPY faded some of the prior day's advances and gave back the 154.00 status following an acceleration in wages, with USD weakness further weighing on the pair in early European hours. Aside from that, there is little else to mention for the JPY, with the pair comfortably tucked within yesterday's 152.96-154.35 range. Furthermore, one of Japan's largest labour unions, UA Zensen, is reportedly planning to push for a 6% wage hike for regular workers in next year's talks, according to Bloomberg.
• Sterling in focus as the clock ticks down to the Bank of England rate decision, minutes, and MPR are due at 12:00GMT/07:00EST, with the press conference at 12:30GMT/07:30EST. The MPC is expected to keep the Bank Rate at 4.0%, likely via a 6-3 vote, with focus on any signals regarding future easing. Despite softer-than-expected September inflation, elevated Y/Y CPI is expected to keep policymakers on hold, though three members may favour a cut. GBP/USD resides in a current 1.3042-1.3089 range after topping yesterday's peak at 1.3054.
• Diverging as the AUD/NZD cross rises above 1.1500 from a 1.1486 intraday low, with the AUD propped up by the base metals and the NZD hampered by cautious RBNZ commentary. Overnight, RBNZ Governor Hawkesby said he doesn’t think they are out of the worst on global trade tensions, while he added the labour market has deteriorated, which is something they anticipated. AUD/USD resides in a 0.6497-0.6518 range and is still some way off its 100 DMA (0.6539). NZD/USD is contained in a 0.5651-0.5669 range at the time of writing.
• EUR/NOK stopped just shy of its 100 DMA (11.7519) following the policy decision by Norges Bank, which opted to keep rates steady at 4.00% as expected. The Bank largely reiterated the statement from the prior meeting, suggesting that "no information has been received that indicates that the outlook for the Norwegian economy has changed significantly since the September policy meeting".
• PBoC set USD/CNY mid-point at 7.0865 vs exp. 7.1222 (Prev. 7.0901)
• Brazilian Central Bank maintained the Selic rate at 15.00%, as expected, with the decision unanimous. BCB evaluated that maintaining the interest rate at the current level for a very prolonged period is enough to ensure convergence of inflation to the target. Furthermore, it said that future monetary policy steps can be adjusted, and it will not hesitate to resume the rate hiking cycle if appropriate.

Fixed Income

• USTs are contained overnight as newsflow at the time was relatively limited and participants awaited a packed docket of Fed speak, texts are expected from Williams (voter) and Paulson (2026). Spent the morning near enough unchanged and just above the 112-10 session low. Thereafter, a bout of support was seen for havens generally around the European cash equity open; potential drivers include the Israeli comments on Egypt. Thereafter, the docket ahead was lightened by an early release of October’s Challenger job cuts. Printed at 153k (prev. 54k), to a seven-month high. This added to the modest strength seen in USTs and took them to a 112-18 high with gains of eight ticks at best. A print that has added a little bit of dovishness back into Fed pricing, though the odds of a 25bps cut in December remain at around 65% after losing the 70% handle yesterday following ADP and ISM Services. Markets see more job market indicators today via the Chicago Fed BLS unemployment forecast and the latest Revelio statistics.
• Bunds initial action was similar to that outlined above in USTs. Bunds spent the first part of the day holding near enough unchanged and just above the 129.03 opening mark. Thereafter, a pickup occurred around the European cash equity open before a 129.18 peak printed alongside Challenger; again, detailed in USTs above. Prior to this, an interesting speech from ECB’s Schnabel, where she said there are factors that are suggestive of tilting the structure of the ECB’s portfolio towards shorter-dated assets, but no move in Bunds at the time. Construction PMIs passed without impact this morning. Ahead, traders look to the referenced US events before remarks from ECB’s Nagel and Chief Economist Lane; particularly regarding the ECB’s portfolio, in light of Schnabel. No move to supply from Spain and France this morning. Overall, the auctions were well received with the long-dated French metric in particular garnering strength, a welcome sign amid the ongoing political turmoil.
• Gilts opened firmer by around 15 ticks and then quickly extended a handful more to a 93.33 high, a move that acknowledged the modest bullish action seen at the time, as outlined above. Price action for Gilts was a little more pronounced than that seen in peers, nothing too significant behind this but potentially a function of the relative underperformance seen in Gilts vs Bunds for much of Wednesday and/or positioning into the BoE. The BoE is expected to maintain the policy rate at 4.00%, though the decision will almost certainly be subject to dissent; expectations are broadly for either 7-2 or 6-3, however a split where Governor Bailey has to cast the deciding vote cannot be ruled out.
• Spain sells EUR 4.503bln vs exp. EUR 4-5bln 3.00% 2033, 1.85% 2035, 3.50% 2041 Bono & EUR 0.534bln vs exp. EUR 0.25-0.75bln 1.15% 2036 IL Bono.

Crude

• Crude benchmarks have pared back on Wednesday’s losses following comments from Israeli Defense Minister Katz and sellers failing to extend through the lows of the 7-day range. After testing prior support lows, crude benchmarks sold off, reversing APAC gains, and troughed at USD 59.46/bbl and 63.37/bbl. However, this selloff was short-lived and benchmarks bid higher to a peak of 60.51/bbl and 64.34/bbl respectively. Saudi Arabia cut its December Light Crude OSP to Asia, in line with expectations. This confirms that the kingdom is comfortable with Brent prices holding between USD 60-65/bbl. Slight downticks were seen in crude benchmarks but move wasn’t sustained.
• Spot XAU has followed on from Wednesday’s gains as the yellow metal continues to consolidate following its 11% selloff from ATHs. XAU dipped to a trough of USD 3964/oz early in the APAC session but reversed higher and extended through Wednesday’s high at USD 3990/oz as the European session risk sentiment started off weak. Currently, the yellow metal is trading near session highs at USD 4017/oz. A surprising Challenger Layoff release had little impact on spot gold action.
• Base metals are trading mixed, with iron ore continuing to sell off as China steel industry heads into the low season while copper gains following risk-on tone during the APAC session. 3M LME Copper dipped to a low of USD 10.69k/t before driving higher as it followed the CME Copper bid back above USD 5/lb. 3M LME Copper peaked at USD 10.79k/t and remains in a c. USD 40/t band near session highs.
• Saudi Arabia set the December Light Crude OSP to Asia to + USD 1.00/bbl vs Oman/Dubai average (prev. + USD 2.20), to Europe at + USD 1.35/bbl vs ICE Brent (prev. +1.35), and to US at + USD 3.20/bbl vs ASCI (prev. + USD 3.70).

Geopolitics

• "Israeli Defense Minister Yisrael Katz: Declaring war on smuggling operations through drones on our border with Egypt", according to Al Jazeera; "ordered the border area with Egypt to be turned into a closed military zone", via Iran International
• US President Trump warned the Nigerian government that they had better move fast to stop the killing of Christians.
• US President Trump recently expressed reservations to top aides about launching military action to oust Venezuelan President Maduro, fearing that strikes might not compel Maduro to step down, according to sources cited by WSJ.

US Event Calendar

• 8:30 am: 3Q P Nonfarm Productivity, est. 3.35%, prior 3.3%
• 8:30 am: 3Q P Unit Labor Costs, est. 0.85%, prior 1%
• 8:30 am: Nov 1 Initial Jobless Claims, est. 225k
• 8:30 am: Oct 25 Continuing Claims, est. 1948k
• 10:00 am: Sep F Wholesale Inventories MoM

Central Bank Speakers

• 11:00 am: Fed’s Williams speaks at Goethe University Frankfurt
• 11:00 am: Fed’s Barr Participates in Moderated Discussion
• 12:00 pm: Fed’s Hammack Speaks at the Economic Club of New York
• 3:30 pm: Fed’s Waller in Panel on Central Banking and Payments
• 4:30 pm: Fed’s Paulson speaks on Consumer Finance Institute
• 5:30 pm: Fed’s Musalem Speaks at a Fireside Chat on Monetary Policy

DB's Jim Reid concludes the overnight wrap

The risk-on tone has returned to markets over the last 24 hours, with the S&P 500 (+0.37%) recovering from the previous day’s selloff. The main driver was stronger-than-expected data, alongside growing speculation that the government shutdown might come to an end soon. So that helped to boost investor optimism about the near-term outlook, with risk assets doing well across the board. Indeed, US HY spreads (-9bps) tightened for the first time in a week, and Bitcoin (+3.38%) stabilised after its losses in recent days. Moreover, that trend has continued overnight, with several indices in Asia seeing strong gains, including the Nikkei (+1.48%) and the Hang Seng (+1.61%).

That US data was pivotal for the market recovery, as it pushed back against the building narrative about an economic slowdown, particularly after the weaker ISM manufacturing print on Monday. First, we had the ADP’s report of private payrolls, which showed private payrolls were up by +42k in October (vs. +30k expected), which was a clear rebound from the -29k contraction in September. That’s a release that’s taken on more significance than usual, given we’re missing the usual jobs report because of the shutdown. Then shortly after, we had the ISM Services index for October, which rose by more than expected to 52.4 (vs. 50.8 expected). So again, that reassured investors that the US outlook was more resilient than feared, and we even saw the new orders subcomponent rise to a 12-month high of 56.2 (vs. 51.0 expected).

Those prints meant investors dialled back their expectations for Fed rate cuts in the months ahead. Moreover, there was fresh momentum in that direction from the prices paid component of the ISM services, which ticked up to 70.0. That now takes it to levels last seen in late-2022, back when the Fed were rapidly hiking rates to clamp down on inflation. So that added to concerns about tariff-driven inflation, and investors felt it made future cuts less likely. For instance, the likelihood of a rate cut in December fell from 70% to 62% by the close, and if we look further out, the number of cuts priced by December 2026 fell -6.0bps on the day to 77bps. So that meant Treasury yields moved higher across the curve, with the 2yr yield (+5.5bps) rising to 3.63%, whilst the 10yr yield (+7.4bps) moved up to 4.16%.

In the meantime, there were also fresh headlines on the government shutdown, as speculation continued as to whether some sort of deal might be reached. Notably, the Washington Post reported yesterday that around a dozen Senate Democrats were considering voting to end the shutdown, saying that a bipartisan group was working on a deal.

According to the article, it said that Republicans would agree in return to hold a vote on extending Affordable Care Act subsidies. But later in the day, there was a Politico article saying that the Democratic wins in the elections had boosted those arguing they should dig in. So the Polymarket chances have moved around considerably, although they still point to a 50% chance that the shutdown ends by November 15.

On the tariffs, the Supreme Court heard arguments yesterday in the case against Trump’s use of tariffs under the International Emergency Economic Powers Act (IEEPA), which were previously ruled invalid by the lower courts. The questioning left a sense of key justices suggesting that the President may have overstepped his authority with this use of emergency powers. For instance, the Polymarket odds that the Supreme Court would rule in favour of the IEEPA tariffs declined from 38% to 25%. However, even if the current broad tariffs are ruled invalid, the details of the ruling and which alternative avenues the administration end up pursuing will be important for the eventual tariff outcome.

This backdrop proved to be a positive one for equities, with the S&P 500 (+0.37%) recovering from its selloff the previous day, though it did give up about half of the day’s gains in the final hour of trading. And while the Magnificent 7 (+0.88%) outperformed, it was a good day all round, as the small-cap Russell 2000 rose +1.54%, and more than 60% of the S&P 500 were higher on the day. Meanwhile in Europe, there was a similarly positive trend, which was reinforced by the final PMIs from across the continent. Indeed, the Euro Area composite PMI was revised up to 52.5 (vs. flash 52.2), leaving the reading at a two-year high. So that helped the STOXX 600 (+0.23%) to advance, alongside gains for the FTSE 100 (+0.64%) and the DAX (+0.42%). But the risk-on move didn’t extend to commodities, as Brent crude (-1.43%) fell to a two-week low of $63.52/bbl as the focus again shifted to emergent excess oil supply , whilst gold (+1.21%) recovered most of Tuesday’s losses.

Overnight in Asia, the equity rally has continued, with the major indices advancing across the region. That’s been clear across the board, with gains for the Nikkei (+1.48%), the Hang Seng (+1.61%), the CSI 300 (+1.23%), the Shanghai Comp (+0.86%), and the KOSPI (+1.44%). However, US and European equity futures are broadly steady this morning, with those on the S&P 500 (-0.02%) and the DAX (+0.02%) currently little changed.

Looking forward, a key focus today will be on the Bank of England’s latest policy decision, which is being announced at 12:00 London time. The consensus and market pricing is expecting rates to stay on hold at 4%, but at time of writing markets are pricing in a 26% probability of a 25bp cut, so there’s a bit of uncertainty in market pricing. In his preview, our UK economist also expects a hold, but his call is now finely balanced, and he thinks the case for a 25bp rate cut has strengthened materially after a dovish round of data. Ahead of that, sovereign bond yields moved higher across Europe, in line with the moves for US Treasuries. Gilts saw the biggest increase, with 10yr yields up +3.8bps on the day, but there were also increases for yields on 10yr bunds (+1.9bps), OATs (+1.9bps) and BTPs (+2.2bps).

To the day ahead now, and one of the main highlights will be the Bank of England’s latest policy decision. There’s also plenty of speakers, including ECB Vice President de Guindos, the ECB’s Kocher, Schnabel, Villeroy, Nagel and Lane, along with the Fed’s Williams, Barr, Hammack, Waller and Musalem. On the data side, we’ll get German industrial production and Euro Area retail sales for September.

Tyler Durden Thu, 11/06/2025 - 08:33

Pirates Attack Tanker Off Somalia Coast 

Maritime journal Lloyd's List reported early Thursday that the Malta-flagged tanker Hellas Aphrodite was boarded by suspected pirates off the Somali coast. This maritime incident comes just days after another attempted hijacking of a commercial vessel in the region. 

Pirates have boarded Malta-flagged Hellas Aphrodite, a product tanker, off the Somali coast just days after a near miss in the same region pic.twitter.com/PEeuTbIrUO

— Lloyd's List (@LloydsList) November 6, 2025

UK Maritime Trade Operations (UKMTO) confirmed a small vessel "fired small arms and RPGs" and "unauthorised personnel" boarded the tanker hauling gasoline about 560 nautical miles off the southeast of Eyl, Somalia. 

Lloyd's List noted, "An unsuccessful attempt to board a Stolt-Nielsen tanker off Somalia on Monday is unlikely to be an isolated incident with growing evidence of a resurgent piracy threat building with links to al-Shabaab and the Houthis."

Lloyd's List reported that an unsuccessful attempt to board a Stolt-Nielsen tanker off Somalia on Monday is unlikely to be an isolated incident with growing evidence of a resurgent piracy threat building with links to al-Shabaab and the Houthis https://t.co/aFFLRZqyyn

— Lloyd's List (@LloydsList) November 6, 2025

Greek news outlet Enikos reported that Latsco Marine Management, which operates the Hellas Aphrodite, confirmed all 24 crew members are safe and accounted for. The situation remains ongoing.

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