Today, in the Calculated Risk Real Estate Newsletter: FHFA’s Q3 National Mortgage Database: Outstanding Mortgage Rates, LTV and Credit Scores

A brief excerpt:

Here are some graphs on outstanding mortgages by interest rate, the average mortgage interest rate, borrowers’ credit scores and current loan-to-value (LTV) from the FHFA’s National Mortgage Database through Q3 2025 (released this morning).
...
This shows the surge in the percent of loans under 3% starting in early 2020 as mortgage rates declined sharply during the pandemic.

Note that a fairly large percentage of mortgage loans were under 4% prior to the pandemic!

The percent of outstanding loans under 4% peaked in Q1 2022 at 65.1% (now at 51.5%), and the percent under 5% peaked at 85.6% (now at 68.6%). These low existing mortgage rates make it difficult for homeowners to sell their homes and buy a new home since their monthly payments would increase sharply.

This was a key reason existing home inventory levels were so low. However, time is eroding this lock-in effect.

There is much more in the article.

From the Fed: Minutes of the Federal Open Market Committee, December 9–10, 2025. Excerpt:

In their consideration of monetary policy at this meeting, participants noted that inflation had moved up since earlier in the year and remained somewhat elevated. Participants further noted that available indicators suggested that economic activity had been expanding at a moderate pace. They observed that job gains had slowed this year and that the unemployment rate had edged up through September. Participants assessed that more recent indicators were consistent with these developments. In addition, they judged that downside risks to employment had risen in recent months.

Against this backdrop, most participants supported lowering the target range for the federal funds rate at this meeting, while some preferred to keep the target range unchanged. A few of those who supported lowering the policy rate at this meeting indicated that the decision was finely balanced or that they could have supported keeping the target range unchanged. Those who favored lowering the target range for the federal funds rate generally judged that such a decision was appropriate because downside risks to employment had increased in recent months and upside risks to inflation had diminished since earlier in 2025 or were little changed. Some of these participants emphasized that lowering the target range for the federal funds rate at this meeting was in line with a forward-looking approach to the pursuit of the Committee's dual-mandate objectives. These participants noted that reducing the policy rate at this meeting would be consistent with the projected decline in inflation over coming quarters while contributing to a strengthening of economic activity in 2026 that would help stabilize labor market conditions after this year's cooling. Those who preferred to keep the target range for the federal funds rate unchanged at this meeting expressed concern that progress toward the Committee's 2 percent inflation objective had stalled in 2025 or indicated that they needed to have more confidence that inflation was being brought down sustainably to the Committee's objective. These participants also noted that longer-term inflation expectations could rise should inflation not return to 2 percent in a timely manner. Some participants who favored or could have supported keeping the target range unchanged suggested that the arrival of a considerable amount of labor market and inflation data over the coming intermeeting period would be helpful in making judgments on whether a rate reduction was warranted. A few participants judged that lowering the federal funds rate target range at this meeting was not justified because data received over the intermeeting period did not suggest any significant further weakening in the labor market. One participant agreed with the need to move toward a more neutral monetary policy stance but preferred lowering the target range by 1/2 percentage point at this meeting.

In considering the outlook for monetary policy, participants expressed a range of views about the restrictiveness of the Committee's policy stance. Most participants judged that further downward adjustments to the target range for the federal funds rate would likely be appropriate if inflation declined over time as expected. With respect to the extent and timing of additional adjustments to the target range for the federal funds rate, some participants suggested that, under their economic outlooks, it would likely be appropriate to keep the target range unchanged for some time after a lowering of the range at this meeting. A few participants observed that such an approach would allow policymakers to assess the lagged effects on the labor market and economic activity of the Committee's recent moves toward a more neutral policy stance while also giving policymakers time to acquire more confidence about inflation returning to 2 percent. All participants agreed that monetary policy was not on a preset course and would be informed by a wide range of incoming data, the evolving economic outlook, and the balance of risks.

In discussing risk-management considerations that could bear on the outlook for monetary policy, participants generally judged that upside risks to inflation remained elevated and that downside risks to employment were elevated and had increased since the middle of 2025. Most participants noted that a move toward a more neutral policy stance would help forestall the possibility of a major deterioration in labor market conditions. Many of these participants also judged that the available evidence pointed to a reduced probability that tariffs would lead to persistent inflation pressures. These participants observed that it was appropriate for the Committee to ease its policy stance in response to downside risks to employment, thereby helping to bring the risks to achieving the dual-mandate goals into better balance, and suggested that a move toward a more neutral policy stance at this meeting would leave policymakers well positioned to determine the extent and timing of additional adjustments to the policy rate, with these judgments being based on the incoming data, the evolving outlook, and the balance of risks. By contrast, several participants pointed to the risk of higher inflation becoming entrenched and suggested that lowering the policy rate further in the context of elevated inflation readings could be misinterpreted as implying diminished policymaker commitment to the 2 percent inflation objective. Participants judged that a careful balancing of risks was required and agreed on the importance of well-anchored longer-term inflation expectations in achieving the Committee's dual-mandate objectives.
emphasis added

Today, in the Calculated Risk Real Estate Newsletter: Case-Shiller: National House Price Index Up 1.4% year-over-year in October

Excerpt:

S&P/Case-Shiller released the monthly Home Price Indices for October ("October" is a 3-month average of August, September and October closing prices). August closing prices include some contracts signed in June, so there is a significant lag to this data. Here is a graph of the month-over-month (MoM) change in the Case-Shiller National Index Seasonally Adjusted (SA).

The National index increased 0.37% month-over-month (MoM). This is the 3rd consecutive month with a MoM increase seasonally adjusted that followed 5 consecutive months with a MoM decline.

There is much more in the article.

Jennings: "Until Somebody In Power Goes To Jail", Blue State Fraud Won't Stop

Authored by Steve Watson via Modernity.news,

In a heated CNN clash, conservative commentator Scott Jennings called out the lack of real accountability in Democrat-run states, demanding elected officials face consequences for enabling billion-dollar scams.

Jennings addressed the rot in blue states where massive fraud schemes have flourished under lax oversight. Facing pushback from host Abby Phillip, Jennings insisted that prosecuting small-time operators isn’t enough—real change demands jailing those at the top who allowed it all to happen.

The discussion centered on the sprawling welfare fraud in Minnesota, but Jennings expanded it to a nationwide indictment of blue state governance. When Phillip defended ongoing probes, saying, “This idea that nothing is being done, that no one is being held accountable, that this was just left to run rampant, is completely false,” Jennings countered sharply.

This was another watershed moment on CNN.

Scott Jennings used his voice to speak for the millions of Americans fed up with fraud running roughshod in blue states across the country.

Abby Phillip tried to push her narrative about the Somali fraud scheme in Minnesota…but… pic.twitter.com/MfN93LqyOt

— Overton (@overton_news) December 30, 2025

“Well, some people have been held accountable. But I think in the opinion of most Republicans, not nearly enough,” he replied.

He then delivered the core demand: “And truthfully, until somebody in a position of power, until somebody in a position in Minnesota, elected position, who was in charge of administering this or having some oversight over it, goes to jail, it’s honestly never going to stop.”

Jennings broadened the scope: “Look what’s going on in blue states across the country: 9 billion in Minnesota, 70 billion in fraud in California, cooking the crime stats in Washington, D.C.”

Driving the point home, he asked, “When is someone in a position of power going to go to jail for the rampant fraud?” and added, “You can put all the low-level people in jail you want, but until somebody in charge goes to jail, it won’t stop!”

The scandal Jennings spotlighted involves Somali-led operations in Minneapolis, where billions in federal welfare funds—intended for children and the vulnerable—were siphoned through fake daycares and shell companies.

Estimates peg the theft at $9 billion in Minnesota alone, part of a larger pattern tied to unvetted immigration and weak enforcement. The Trump administration’s DOJ is now intensifying efforts, with door-to-door probes by Homeland Security targeting suspected sites.

DHS is on the ground in Minneapolis, going DOOR TO DOOR at suspected fraud sites.

The American people deserve answers on how their taxpayer money is being used and ARRESTS when abuse is found. Under the leadership of @Sec_Noem, DHS is working to deliver results. pic.twitter.com/7XtRflv36b

— Homeland Security (@DHSgov) December 29, 2025

This surge follows viral exposures, including a video by Youtuber Nick Shirley touring dozens of Somali-run daycares implicated in the schemes.

Attorney General Pam Bondi has charged 98 individuals in Minnesota fraud cases, with over 60 convictions. More probes are underway, signaling an end to the free pass for blue state elites.

This isn’t isolated—it’s the byproduct of years of open borders flooding communities with unassimilated groups, creating ripe ground for abuse. As Jennings laid bare, without holding powerful Democrats accountable, the cycle of theft from American taxpayers continues.

Your support is crucial in helping us defeat mass censorship. Please consider donating via Locals or check out our unique merch. Follow us on X @ModernityNews.

Tyler Durden Tue, 12/30/2025 - 09:50

CIA Drone Carried Out First Known Land Strike On Venezuela 

The CIA is reported to have carried out a bombing operation within Venezuelan territory, CNN and The New York Times report in follow-up to President Trump touting that the US had knocked out "a big facility".

CNN while citing unnamed sources, reports that the CIA conducted a drone strike on a remote dock along Venezuela's coastline, after the US suspected the site was being used to store and transport illegal drugs, and which were supposedly bound for America.

Illustrative: MQ-9 Reaper Drone

Reports indicate the location was unoccupied at the time of the strike, which occurred earlier this month. The New York Times published a similar account based on anonymous sources, specifying that the operation took place last Wednesday.

As we detailed, President Trump had on Friday in a radio interview disclosed something which missed the attention of the US and global media. He let slip that a large land site had been knocked out by a strike from US forces in the Caribbean.

Trump may have actually assumed the attack which he disclosed publicly for the first time was already being reported on, but it had not. He was being interviewed by John Catsimatidis, the Republican billionaire who owns the WABC radio station in New York on his The Cats & Cosby Show, and the two were talking about the Venezuela campaign. 

"They have a big plant or a big facility where the ships come from," Trump said, though he did not explicitly identify the exact location or even country attacked. "Two nights ago we knocked that out."

Interestingly, the remarks generated almost no headlines for much of that weekend. But by Monday he expanded on those remarks during a press conference, saying the target was located on Venezuela's coast and that a "major explosion" occurred at a dock where boats were supposedly loaded with drugs.

"There was a major explosion in the dock area where they load the boats up with drugs," he told reporters at Mar-a-Lago, his club and residence in Florida.

"They load the boats up with drugs. So we hit all the boats, and now we hit the area. It’s the implementation area, that’s where they implement, and that is no longer around."

But even after this, neither CIA, nor White House, nor Pentagon would comment. Even more strange was that Venezuelan officials themselves have also remained silent, issuing no public statements regarding the alleged attack. It is perhaps the case they don't want the population to panic, or else don't want to give acknowledgement of a successful land strike by Washington.

Speculation has persisted an effort to identify which facility was hit and what damage was done. Some analysts have highlighted a 'mystery' explosion at an industrial zone in San Francisco municipality, Zulia state, given the timing fits (Wednesday, Dec. 24).

San Francisco Venezuela's second largest city, in the northwest corner of the country, and near the coast. However, local reports also suggest the likelihood the fire was sparked by an electrical accident.

But it is also clear the CIA is active in Venezuela, given White House authorized lethal CIA missions targeting the Latin American country in October - though these may have been occurring long before then.

Venezuela’s Defense Minister Vladimir Padrino López:

‘We know that the CIA is present in Venezuela’ pic.twitter.com/mzZGs67Mvd

— Open Source Intel (@Osint613) October 23, 2025

The American president has also ordered a naval blockade targeting Venezuelan oil exports, with US forces already having seized two tankers transporting Venezuelan crude in international waters, while a third ship reportedly avoided boarding and continued into the Atlantic.

The Pentagon is seeking to enforce what has been described as a "quarantine" of Venezuelan oil over the coming months to further strain the country's economy. Amid all of this, there's a likelihood of yet more land strikes to come.

Tyler Durden Tue, 12/30/2025 - 09:35

 

 

 

“The writing has “been on the wall for well over a year now” that SiriusXM wouldn’t be renewing Howard Stern’s colossal contract — and his employees have been taking advantage, “coasting” on the clock and trolling for new gigs, two current show staffers told The Post.”   –New York Post

 

Let’s delve into an example of declarative reporting predicting an upcoming event that ended up being completely, laughably wrong. You may have missed this one during the dog days of summer.

Supermarket tabloid The U.S. Sun reported on August 4th that “The iconic Howard Stern Show on SiriusXM is set to be canceled after a stunning 20-year run, [unnamed] sources exclusively told The U.S. Sun.” Four days later, The New York Post confidently reported that the Howard Stern Show’s 19-year run at SiriusXM was coming to its final and ignominious end.

Both papers, not coincidentally, are owned by the Murdoch family’s NewsCorp. Each relied on unnamed “longtime staffers” as sources. Both reported Stern’s audience had dwindled “from 20 million a day to 125,000” – if true, a 99.38% drop in listeners. Both misled their readers.

Data from Sirius (and elsewhere) puts Stern’s audience anywhere from 5x to 10x what was misreported –a substantial drop that requires no additional exaggeration. The more complete context would have explained the broader drop in all of SiriusXM audience numbers, and how its time-shifting and streaming app has affected broadcast numbers.

But the big error was simply the declaration that Sirius was finished with Stern. The satellite company just renewed his contract for another 3 years.

Instead, anonymous sources said things like: “Most of us have been coasting at work the last year,” because “we know he’s retiring, whether by choice or because he’s forced out…”

Perhaps motivated reasoning was at play at the Murdoch-owned properties: “The looming end of the once mighty radio personality comes after a sharp change in Stern’s politics.”2

I don’t know Sun/Post reported this in the manner they did; I only know they got the story wrong while engaging in poor journalistic practices.

Anonymous quotes are the stock-in-trade of gossip columnists; it would not surprise me to learn these quotes were entirely fabricated.1 Even with journalists and outlets with a sterling reputation for fairness and objectivity, you should treat any anonymous source with the utmost caution.

~~~

Besides Sirius XM’s stock price, what does Howard Stern’s contract have to do with how we view coverage of markets or the economy?

Surprisingly, a lot. The parallels are there when you see people talking about things they don’t or can’t know about specific future events. The details in Stern’s negotiations are a minor example. There were a dozenish people – lawyers, agents, managers, corporate execs, perhaps board members – involved in the Stern-Sirius contract negotiations.3

Note that a lack of accurate inside dope did not stop reporting in an authoritative voice; was it trashing a political opponent that was so attractive? Might it have ironically been the broad interest in Stern’s activities?

This is the time of year when people confidently talk about things they cannot know. Turn on the TV, browse a website, read a newspaper, magazine, or Substack, and you will see authoritative predictions about what will happen next year, based on what is either unknown or unknowable. A lack of insight or knowledge doesn’t stop the speaker or writer from discussing a topic with great authority and conviction. Expressing doubt, acknowledging multiple possible outcomes, or admitting what you don’t know is considered unacceptable.

This is true regardless of whether the expression is opinion, commentary, speculation, or even wild guesses. Human nature favors precise errors over ambiguous accuracy. This is the default standard—lots of self-assured cockiness and very little humility. History informs us that this approach is flawed when talking about the inherently unknown and unknowable future, especially when capital is at risk.

Media malpractice is everywhere, but this one was exceptionally egregious. The Stern example goes beyond proof of how little we know about what the future holds; it shows how it manifests in supposedly authoritative sources.

We put a lot at risk when we ignore our own lack of knowledge and blind spots. This is especially true when we do not know what we do not know…

 

 

Previously:
“Nobody Knows Anything,” Wall Street Strategist Edition (January 2, 2025)

Nobody Knows Anything, DeepSeek Edition (January 28, 2025)

Nobody Knows Anything, The Beatles edition (September 26, 2024)

Let’s Say It All Together: Nobody Knows Anything (May 5, 2016)

Nobody Knows Anything (Full archive)

 

 

Sources:
BYE-BYE BOOEY The Howard Stern Show ‘to be canceled’ after nearly 20 years on SiriusXM as ‘$100m’ contract is up later this year
by Jessica Finn
The Sun, August 5, 2025

Howard Stern staffers prepping for show’s demise, withholding best material as future uncertain
By Chris Harris
NY Post, Aug. 9, 2025

 

 

 

__________

1. Beginning in the 1980s a wave of fabrication scandals of sources were perpetrated under the cover of anonymity. See, e.g., Janet Cooke at The Washington Post; Jayson Blair at The New York Times; Jack Kelley at USA Today; Stephen Glass at The New Republic, and others involving fabricated and unverifiable sources.

2. From the NYPost:

“I don’t know if its wokeness that alienated some of his audience, or if he just got tamer with age, but whatever it is, its apparent no one wants to hear it anymore,” the second staffer offered.

3. Anyone who has ever been involved in a large deal knows that the fewer people who know anything, the less chance of an accidental derailment…

 

~~~

 

I extensively detail why “Nobody Knows Anything” in How Not to Invest: The ideas, numbers, and behaviors that destroy wealth―and how to avoid them.”

It’s on sale at Amazon for $18.01!

 

The post Nobody Knows Anything, Howard Stern Edition appeared first on The Big Picture.

Trump Says Netanyahu Pardon "On Its Way", Israeli President Says Otherwise

Authored by Travis Gilmore via The Epoch Times,

President Donald Trump said on Dec. 29 that Israeli President Isaac Herzog told him a pardon for Prime Minister Benjamin Netanyahu was “on its way.” That assertion, however, was disputed by Herzog’s office.

“He’s a wartime prime minister who’s a hero. How do you not give a pardon?” Trump, while standing alongside Netanyahu, told reporters ahead of a meeting at his Mar-a-Lago resort in Palm Beach, Florida.

“I spoke to the president ... he tells me it’s on its way.”

Trump suggested the fate of Israel would be far worse if Netanyahu had not been in charge during recent crises—including the Oct. 7, 2023, Hamas terrorist attacks.

“If you had the wrong prime minister right now, Israel would not exist,” Trump said.

“They were met with a force the likes of which very few countries could have handled.”

Herzog’s office, nevertheless, issued a statement that appeared to contradict Trump’s comments.

When asked about the U.S. president’s remarks, Herzog’s office said the Israeli president had not spoken with Trump since a pardon request was submitted several weeks ago.

“There has not been a conversation between President Herzog and President Trump since the pardon request was submitted,” the statement read.

“Several weeks ago, a conversation took place between President Herzog and a representative on behalf of President Trump, who inquired about the U.S. President’s letter. During that conversation, an explanation was provided regarding the stage of the process in which the request currently stands, and that any decision on the matter will be made in accordance with the established procedures.

“This was conveyed to President Trump’s representative, exactly as President Herzog stated publicly in Israel.”

Netanyahu is the first Israeli prime minister to be charged with a crime while in office. He denies the bribery, fraud, and breach-of-trust charges stemming from his 2019 indictment.

His own request for a pardon, submitted on Nov. 30, argued that frequent court hearings hamper his ability to govern and that clemency would be in the national interest. The appeal was lodged following the start of a U.S.-brokered cease-fire in Gaza.

Netanyahu’s appeal for clemency has been criticized by his opponents, who said that pardoning him mid-trial would be a breach of the rule of law, according to the Times of Israel.

As per Israeli law, the president has the authority to pardon convicts; however, there is no precedent for issuing a pardon while a trial is still ongoing.

Netanyahu’s quest for a pardon has been supported by Trump, who wrote a formal letter to Herzog in November urging him to grant clemency, calling the case against the Israeli prime minister “political, unjustified prosecution.”

During their Mar-a-Lago meeting on Dec. 29, Trump and Netanyahu discussed Gaza, Iran, Syria, and other matters.

“We had a big meeting with a lot of people, a lot of talent from Israel and from the U.S.,” Trump said after the meeting.

“And I think we came to a lot of conclusions. There’s very little difference in what we’re looking at, and where we want to be, where we want to go.”

Netanyahu expressed gratitude for a “very productive meeting.”

“I think we have a partnership ... second to none,” he said. “It’s allowed us to do tremendous things.”

Ahead of the meeting, Trump said they would begin the second phase of the peace plan in Gaza “as quickly as we can.”

“But there has to be a disarming of Hamas,” he noted.

Rebuilding the war-torn region is a priority, and sanitization efforts are underway, Trump said.

“It’s been a mess for a long time, but we’re going to straighten it out,” Trump said. “We’re helping the people of Gaza a lot, and so is Israel.”

Netanyahu thanked Trump for the opportunity to meet and for his continued support of Israel.

“We’ve never had a friend like President Trump in the White House. It’s not even close,” the prime minister said.

“I think it’s not merely Israel’s great fortune; it’s the world’s great fortune.”

After the meeting, Netanyahu said his nation would award its highest civilian honor, the Israel Prize, to Trump, who will be the first non-Israeli to receive the prize. The prize was announced formally on Monday by Israel’s minister of education.

Tyler Durden Tue, 12/30/2025 - 09:15

"Stark Reversal" From Pandemic: US Home Price Growth Slowest Since Q2 2023

Home prices in America's largest 20 cities surged 0.32% MoM in October (far higher than the +0.1% MoM move expected) but for context, this is the weakest annual home price growth since the March through July 2023 period, when the market was absorbing the initial shock of the Fed’s rapid rate hikes

Source: Bloomberg

“October’s data show the housing market settling into a much slower gear, with the National Composite Index up only about 1.4% year over year – among the weakest performances since mid-2023,” said Nicholas Godec, CFA, CAIA, CIPM, Head of Fixed Income Tradables & Commodities at S&P Dow Jones Indices.

"This broad stagnation suggests that elevated mortgage rates – still hovering around the mid-6% range in late October – are finally overwhelming the market’s earlier supply-driven resilience. Would-be buyers are facing the highest borrowing costs in decades, and that affordability squeeze has curbed demand enough to erode price momentum across most of the country."

But could be set to improve in the (lagged) months ahead...

Source: Bloomberg

Regional performance underscores a striking geographic rotation.

• Chicago now leads all major markets with a 5.8% annual price gain, followed by New York at 5.0% and Cleveland at 4.1%. These traditionally stable Midwestern and Northeastern metros have sustained solid growth even as broader conditions soften.

• By contrast, Tampa home prices are down 4.2% year over year – the steepest drop among the 20 cities, marking Tampa’s 12th consecutive month of annual declines. Other former highflyers in the Sun Belt are similarly struggling: Phoenix (-1.5%), Dallas (-1.5%), and Miami (-1.1%) all remain in negative territory.

As Godec notes, "it’s a stark reversal from the pandemic boom, as the markets that were once ‘pandemic darlings’ are now seeing the sharpest corrections while more traditional metros continue to post modest gains."

Tyler Durden Tue, 12/30/2025 - 09:08

Meta "Joining Forces" With China-Founded Manus AI In $2 Billion Deal

Mark Zuckerberg has been aggressively repositioning Meta Platforms' focus and spending toward artificial intelligence, particularly to achieve "personal superintelligence" that enhances existing apps like Facebook and Instagram and, of course, boosts revenue. Put simply, the pivot to AI looks like a far better venture than Zuckerberg's absolutely horrendous bet on the metaverse.

A new Wall Street Journal report on Tuesday said that Meta is buying an AI startup with Chinese founders that conducts deep research called Manus. The move is a familiar strategy: if you cannot beat the competition, buy it. Zuckerberg has repeatedly taken this approach this year, including aggressively poaching AI talent across Silicon Valley.

Manus is entering the next chapter: we’re joining forces with Meta to take general agents to the next level.

Full story on our blog: https://t.co/huPrnbITCi

— Manus (@ManusAI) December 29, 2025

People familiar with the Meta-Manus deal say the acquisition will cost upwards of $2 billion. At the same time, Manus was seeking a new round of fundraising at roughly that valuation when Meta approached with an offer.

In a statement to the Financial Times, Meta said it would "operate and sell the Manus service" while integrating its technology into its own products, such as the Meta AI chatbot.

Meta noted that Manus is one of the "leading autonomous general-purpose agents," with tools capable of performing tasks including market research, coding, and data analysis. Meta could ultimately offer this new AI agent service for as little as $20 per month.

The acquisition stands out as one of the most high-profile deals to date involving a U.S. tech giant purchasing an AI product built within Asia's AI and startup ecosystem. It highlights how AI innovation is no longer confined to Silicon Valley, but is emerging across parts of Asia. The deal also highlights a strategic shift by U.S. tech giants toward acquiring proven AI products and talent overseas, rather than relying solely on in-house development, as the race for AI agents and automation intensifies following China's DeepSeek debut earlier this year.

Manus raised $75 million in a Series B funding round led by U.S. venture firm Benchmark in April. Political scrutiny surrounding the VC firm's funding round with the China-linked startup later prompted Manus to relocate its headquarters to Singapore.

WSJ reported that Manus CEO Xiao Hong will soon report to Meta COO Javier Olivan. The startup employs about 100 staff, primarily in Singapore.

Using publicly available data from the supply chain analysis firm Sayari, Manus is owned by Singapore-registered Butterfly Effect Technology (Butterfly Effect Pte. Ltd.). The founders include Xiao Hong, often called "Red," as CEO and co-founder; Yichao "Peak" Ji as chief scientist and co-founder; and Zhang Tao as co-founder and product partner.

"In this AI wave, Chinese entrepreneurs building open-source large models or AI applications have been iterating the fastest and are highly competitive," Li Chengdong, founder of the Haitun internet think tank, told the FT. He added, "An incredible company and team are being sold to the United States. If China does not value talent and entrepreneurs and does not respect the basic rules of capital, it will ultimately be very hard for the country to win the China-US tech war."

Tyler Durden Tue, 12/30/2025 - 09:00

S&P/Case-Shiller released the monthly Home Price Indices for October ("October" is a 3-month average of August, September and October closing prices).

This release includes prices for 20 individual cities, two composite indices (for 10 cities and 20 cities) and the monthly National index.

From S&P S&P Cotality Case-Shiller Index Records Annual Gain in October 2025

• The S&P Cotality Case-Shiller U.S. National Home Price NSA Index posted a 1.4% annual gain for October, up from a 1.3% rise in the previous month.

• Regional divergence persists as Midwestern and Northeastern markets, led by Chicago (5.8%) and New York (5.0%), outpaced Sun Belt cities like Tampa (–4.2%) and Phoenix (–1.5%).

• Sixteen of 20 markets declined month-over-month in October, signaling broad stagnation as high mortgage rates weigh on affordability and suppress price momentum.
...
“October’s data show the housing market settling into a much slower gear, with the National Composite Index up only about 1.4% year over year – among the weakest performances since mid-2023,” said Nicholas Godec, CFA, CAIA, CIPM, Head of Fixed Income Tradables & Commodities at S&P Dow Jones Indices. “This figure is essentially unchanged from September’s 1.3% annual gain and represents less than a third of the 5.1% average home price increase recorded in 2024. National home prices also continue to lag consumer inflation, as October’s CPI is estimated around 3.1% (based on a provisional index the U.S. Treasury announced due to the federal data shutdown) – roughly 1.8 percentage points higher than the latest housing appreciation. In real terms, that gap implies a slight decline in inflation-adjusted home values over the past year.

“Regional performance underscores a striking geographic rotation. Chicago now leads all major markets with a 5.8% annual price gain, followed by New York at 5.0% and Cleveland at 4.1%. These traditionally stable Midwestern and Northeastern metros have sustained solid growth even as broader conditions soften. By contrast, Tampa home prices are down 4.2% year over year – the steepest drop among the 20 cities, marking Tampa’s 12th consecutive month of annual declines. Other former high- flyers in the Sun Belt are similarly struggling: Phoenix (-1.5%), Dallas (-1.5%), and Miami (-1.1%) all remain in negative territory. It’s a stark reversal from the pandemic boom, as the markets that were once ‘pandemic darlings’ are now seeing the sharpest corrections while more traditional metros continue to post modest gains.
...
The S&P Cotality Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 1.4% annual gain for October, up from a 1.3% rise in the previous month. The 10- City Composite showed an annual increase of 1.9%, down from a 2.0% increase in the previous month. The 20-City Composite posted a year-over-year increase of 1.3%, down from a 1.4% increase in the previous month.
...
The pre-seasonally adjusted U.S. National, 10-City Composite, and 20-City Composite Indices continued to report negative month-over-month changes in October, posting a -0.3% drop for the 20- City Composite Index and -0.2% decreases for both the 10-City Composite and U.S. National Indices.

After seasonal adjustment, the U.S. National Index reported a monthly increase of 0.4% and both the 10-City Composite and 20-City Composite Indices posted month-over-month gains of 0.3%. emphasis added

Click on graph for larger image.

The first graph shows the nominal seasonally adjusted Composite 10, Composite 20 and National indices (the Composite 20 was started in January 2000).

The Composite 10 index was up 0.3% in October (SA).  The Composite 20 index was up 0.3% (SA) in October.

The National index was up 0.4% (SA) in October.

The second graph shows the year-over-year change in all three indices.

The Composite 10 NSA was up 1.9% year-over-year.  The Composite 20 NSA was up 1.3% year-over-year.

The National index NSA was up 1.4% year-over-year.

Annual price changes were close to expectations.  I'll have more later.

Futures Flat, Precious Metals Rebound On Last Full Trading Session Of 2025

Stock struggled to find direction amid a year-end lack of catalysts and the traditional lull in trading in the final trading days of the year. After suffering one of the biggest one-day drops on record, silver and gold regained their footing after sliding from all-time highs. As of 8:15am, the S&P 500 was set to open flat, while Nasdaq futures fractionally in the red after back-to-back losses. In premarket trading, Mag 7 stocks are mixed while US silver and gold stocks are higher as the precious metals rebound from Monday’s drop with gainers including Hecla (HL) +2.4%, Coeur (CDE) +2.8% and Barrick (B) +2.4%. European stocks outperformed as rising metal prices boosted miners, while a gauge of Asian shares nudged lower. In the most notable overnight FX move, China’s onshore yuan strengthened past the key 7-per-dollar level for the first time since 2023. The greenback remained on course for its worst month since August. Treasuries fell across the curve, with the 10-year yield rising three basis points to 4.14%. Today's US economic data calendar includes the weekly ADP employment change (8:15am), the Case-Shiller home price index (9am), December MNI Chicago PMI (9:45am) and the December Dallas Fed services activity (10:30am). The Fed is set to release minutes of the December FOMC meeting at 2 p.m

In premarket trading, Mag 7 stocks were mixed (Tesla +0.7%, Nvidia +0.1%, Alphabet little changed, Microsoft -0.2%, Amazon -0.1%, Meta Platforms -0.2%, Apple -0.2%)

• Silver and gold mining stocks are higher as the precious metals rebound, with gainers including Hecla (HL) +2.4%, Coeur (CDE) +2.8% and Barrick (B) +2.4%
• Freeport-McMoRan (FCX) rises 1.9% as copper headed for the longest winning run since 2017 in a December rally powered by the prospect of more stress in the supply chain.
• OceanFirst Financial (OCFC) slips less than 1% on light trading after agreeing to buy Flushing Financial.
• T1 Energy Inc. (TE) climbs 5% after the solar equipment manufacturer announced the completion of a $160 million sale of Section 45X production tax credits.

In corporate news, Citigroup expects to post a roughly $1.1 billion after-tax loss on the sale of its remaining business in Russia to Renaissance Capital. And Meta agreed to buy Singapore-based startup Manus, an AI agent that can complete general tasks including screening resumes, creating trip itineraries and analyzing stocks in response to basic instructions. The deal values Manus at more than $2 billion. Tesla published a compilation of analyst estimates for vehicle deliveries to its website, and the averages for the current quarter are more pessimistic than those gathered by Bloomberg.

Global equities are on track for a third straight annual gain in a year when European and Asian stocks trounced the S&P 500. With news flow and trading volumes generally low, investors will focus on the release of minutes from the Federal Reserve’s December meeting for clues about the interest-rate path for 2026. Tuesday also marks the last trading session of the year for many equity markets, including Germany, Japan and South Korea. 

“The overriding theme is that global stock indices have lost momentum into year-end,” wrote Kathleen Brooks, research director at XTB. “There are plenty of reasons for this, including decent returns for 2025, and investors waiting to make big trading decisions until after the Christmas break.”

Still, as Bloomberg notes, investors have reason to be optimistic heading into the new year. MSCI’s gauge for global stocks has climbed an average 1.4% in January over the last 10 years and advanced in six of those instances, Bloomberg data show.

The dollar and Treasury yields are marking time before the 2 p.m. ET release of minutes from the Fed’s December meeting, which saw a third consecutive cut. Amid signs of growing division about where policy heads next, rates may remain on hold until a new chair is in place. Trump teased that he has a preferred candidate to succeed Jerome Powell, but is in no hurry to make an announcement. Wall Street rate strategists, with several notable exceptions, anticipate stable-to-higher Treasury yields in 2026, even with the Fed expected to cut rates as many as three more times.

For another session, precious metals were in focus after trading turned volatile in the last few days. Silver rebounded 5% after tumbling 9% in the previous session. Gold was up 1.5% after losing more than 4%. Among other metals, copper headed for the longest winning streak since 2017 in a rally boosted by the prospect of more stress in the supply chain. Nickel hit the highest since March after top producer Indonesia flagged plans to cut supply.

Meanwhile, President Donald Trump said that he has a preferred candidate to be the next chair of the Federal Reserve, but is in no hurry to make an announcement. He also mused that he might fire Jerome Powell.

In geopolitics, Trump’s campaign to end the war in Ukraine hit fresh problems on Monday when Putin said he would revise Russia’s negotiating position, claiming Ukrainian drones targeted his residence. Zelenskiy dismissed Russia’s allegation as a “new lie” and warned that Moscow could be using it as a pretext to prepare an attack on government buildings in Kyiv. Oil prices are extending Monday’s gains as traders weigh geopolitical tensions from Russia to Venezuela and Iran against concern about a glut. Crude remains on course for a steep annual drop because of worries that global production will eclipse demand after OPEC and its allies ramped up output to try to recapture market share.

In Europe, the Stoxx 600 is up 0.4% and on course for a record close. Mining stocks are outperforming, tracking gains across most of the metals complex. Banks also outperform. Here are some of the biggest movers on Tuesday:

• Fresnillo shares climb as much as 3.7% after Citigroup Inc. analysts boosted their price target on the company while maintaining a buy rating, to take account of higher silver and gold prices.

Earlier in the session, Asian equities edged lower, snapping a seven-day winning streak, as losses in Taiwan and Japan offset gains in Hong Kong.  The MSCI Asia Pacific index fell 0.1%, with TSMC and Hon Hai Precision Industry Co. among the biggest drags. Tuesday marked the last trading day of the year for several Asian markets, including Japan, South Korea and Thailand.  The Philippines remained closed for a holiday.  Some of the region’s tech shares tracked a selloff in US peers ahead of the year-end. China’s new round of military drills around Taiwan also weighed on investor sentiment.  Meanwhile, it was a busy day for stock market listings in Hong Kong, with some of the debuts trading mostly higher. Insilico Medicine Cayman TopCo, an AI drug discovery startup, jumped as much as 48%.

In FX, the Bloomberg Dollar Spot Index is little changed. The euro is flat with little reaction seen after Spanish harmonized CPI slowed as expected.

In rates, treasuries are trading near session lows as US trading gets under way for the year’s final full session; cash and futures markets plan early closes for Wednesday, when the Bloomberg Treasury index will rebalance at 1 p.m. New York time with a 0.06-year duration extension estimated. Yields are higher by about 2-3bp across tenors, the 10-year near 4.14%, with curve spreads little changed. Bunds are a touch lower while gilts inch higher. Treasuries are headed for a small monthly loss amid signs of US economic resilience, yet still on pace for their best annual performance since 2020 following three Fed interest-rate cuts in response to weakening labor-market conditions. Swap contracts for predicting Fed moves price in low probability of a rate cut for the next policy decision on Jan. 28 but fully price one in by mid-year and two by year-end. 

In commodities, spot silver rises 4% while gold and most base metals are also in the green. WTI crude futures climb 0.4% to $58.30 a barrel. 

US economic data calendar includes weekly ADP employment change (8:15am), October FHFA house price index and S&P Cotality home price gauges (9am), December MNI Chicago PMI (9:45am, several minutes earlier for subscribers) and December Dallas Fed services activity (10:30am). The Fed is set to release minutes of the December FOMC meeting at 2 p.m.; the decision to cut interest rates by a quarter point drew two dissents in favor of no action and one in favor of a bigger reduction.

Market Snapshot

• S&P 500 mini little changed
• Nasdaq 100 mini little changed
• Russell 2000 mini +0.2%
• Stoxx Europe 600 +0.4%
• DAX +0.3%
• CAC 40 +0.3%
• 10-year Treasury yield +1 basis point at 4.12%
• VIX +0.3 points at 14.47
• Bloomberg Dollar Index little changed at 1200.33
• euro little changed at $1.1774
• WTI crude +0.5% at $58.35/barrel

Top Overnight News

• Trump Says US Forces Struck Narcotics Loading Docks in Venezuela: BBG
• Russia says its negotiating stance on Ukraine will toughen after accusing Kyiv of attack: RTRS
• China encircles Taiwan in massive military display: RTRS
• China’s Push to Master the Arctic Opens an Alarming Shortcut to U.S: WSJ
• Emboldened Activist Investors Are Circling U.S. Banks: WSJ
• Russia shows off deployment of nuclear-capable Oreshnik missiles in Belarus: RTRS
• Russia attacks Ukraine's Black Sea ports, damages civilian ship, Kyiv says: RTRS
• Facing Alawite backlash, Syria’s new leaders take controversial steps to win loyalty: RTRS
• Silver Jumps in Choppy End to Year for Metals: WSJ
• Meta Buys AI Startup Manus for More Than $2 Billion: RTRS
• AI Trade’s Next Leg Is All About Tech’s ‘Pick-and-Shovel’ Stocks: BBG
• Saudi Ultimatum Deepens Its Rift With Gulf Rival U.A.E.: WSJ
• Cancer’s Soaring Cost Wrecks Patients’ Finances in a Broken System: BBG
• Caterpillar’s Surging Stock Is Fueled by AI, Not Yellow Excavators: WSJ
• NYC Subway Says Goodbye to MetroCard, But Many Riders Already Did: BBG

US Event Calendar

• 9:00 am: Oct FHFA House Price Index MoM, est. 0.1%, prior 0%
• 9:00 am: Oct S&P Cotality CS 20-City YoY NSA, est. 1.1%, prior 1.36%
• 9:00 am: Oct S&P Cotality CS U.S. HPI YoY NSA, prior 1.29%
• 9:45 am: Dec MNI Chicago PMI, est. 40, prior 36.3
• 2:00 pm: Dec 10 FOMC Meeting Minutes

Tyler Durden Tue, 12/30/2025 - 08:48

Citizen Journalist Descends On Ohio, Immediately Finds 'First Signs Of Potentially Massive Somali Fraud'

The "Nick Shirley Effect" has begun, with Muckraker founder Anthony Rubin on the ground in Columbus, Ohio, home to the second-largest Somali community in the U.S., investigating daycare centers. This development comes less than a day after Ohio attorney Mehek Cooke said federal investigators are examining allegations that elements within Ohio's Somali community defrauded millions of dollars from the state's Medicaid system.

"The first Somali-affiliated daycare facility that we knocked on after landing in Columbus, Ohio, today did not answer," Rubin wrote on X, alongside a video showing the daycare center, Great Minds Learning Academy.

Rubin continued, "A neighbor across the street told us, 'I've never seen anybody come out of the building or go into the building.'"

FIRST SIGNS OF MASSIVE POTENTIAL SOMALI FRAUD IN COLUMBUS, OHIO

The first Somali-affiliated daycare facility that we knocked after landing in Columbus, Ohio today did not answer.

A neighbor across the street told us, “I’ve never seen nobody come out the building or go in the… pic.twitter.com/zywy9lPDMw

— Muckraker.com (@realmuckraker) December 30, 2025

On Sunday, Breitbart News published an interview with Ohio attorney Mehek Cooke, who alleges that members of the Somali community in Ohio have defrauded millions of dollars from the state's Medicaid program. She said that authorities at the highest levels are investigating "what is happening in Ohio."

.@MehekCooke: Taxpayer-funded medical fraud is also widespread in Ohio.

"We really need to investigate the Medicaid system and how much it's increased since the Somalian population came." pic.twitter.com/8pJCzjK4qo

— Breitbart News (@BreitbartNews) December 28, 2025

Rubin's on-the-ground reporting comes as tech bros have pitched a grant funding program to "unlock tens of investigative journalists" to cover widespread fraud in Democratic-run states. The idea follows Shirley's investigation into Somali-linked daycare fraud in Minneapolis, which shocked the nation over the weekend with an investigative video that has garnered 125 million views.  

I trust @Cernovich instincts here. If he thinks a grant program can unlock tens of investigative journalists to uncover the breadth and scale of California’s fraud, many people will support it.

Cerno? https://t.co/yoWfLMV8Lb

— Chamath Palihapitiya (@chamath) December 28, 2025

We assess that public sentiment toward DOGE could reverse after the Democratic Party's propaganda machine vilified the effort this year, even as evidence of fraud, waste, and abuse was plainly visible. As on-the-ground reporting expands in corrupt blue states, the scale of the alleged fraud is likely to broaden, increasing the likelihood of a renewed push of DOGE.

Tyler Durden Tue, 12/30/2025 - 08:45

Tesla Publishes Downbeat Wall Street Estimates For Vehicle Sales

Tesla has compiled vehicle delivery forecasts from a broad group of Wall Street firms, including Daiwa, DB, Wedbush, Canaccord, Baird, Wolfe, Exane, GS, RBC, Evercore ISI, Barclays, Wells Fargo, Morgan Stanley, UBS, Jefferies, Needham, HSBC, Cantor Fitzgerald, and William Blair. The overall sell-side analyst consensus implies Q4 deliveries of roughly 422,850 vehicles, representing a 15% year-over-year decline and a 10% drop from the Bloomberg-compiled average of 445,061 vehicles.

Source: Bloomberg

The company is on track for a second consecutive annual decline in deliveries, with analysts expecting 1.6 million vehicles in 2025, down more than 8% from last year.

This follows a slow start to the year, driven by factory retooling for the redesigned Model Y, elevated interest rates, dismal demand for EVs, and the end of federal tax credits, as well as manufactured reputational damage from the Democratic Party's propaganda apparatus. This has included billionaire-funded NGOs working with activist groups to target Tesla and Elon Musk, the spread of false or misleading claims, sustained negative media narratives, and, in some cases, militant left-wing groups carrying out arson attacks on Tesla showrooms. These actions followed Elon Musk's involvement with DOGE to uncover fraud, waste, and abuse, an effort that has since gained broader public traction amid the Minneapolis Somali-linked fraud scandal that has shocked the nation.

Here is the full printout of the Tesla-compiled consensus from sell-side analysts:

Tesla shares are up 14% year to date as of Monday's close.

Investor interest has increasingly shifted toward robotics, artificial intelligence, and power grid upgrades. The convergence of these technologies under a single corporate umbrella shows the uniqueness of the Tesla brand, as no other U.S. company currently operates at a comparable scale across those domains.

Tyler Durden Tue, 12/30/2025 - 07:45

Why Did The EU Slide Into Complete Irrelevance?

Authored by Mike Shedlock via MishTalk.com,

Hint: It’s structural. Trump has nothing to do with it...

The Creeping Death of the Single Market

Eurointelligence discussed the EU’s Slide Towards Irrelevance

The EU has zero chance to emerge as a geopolitical power like the US or China. Strategic autonomy was only a slogan. It came with no strategy, and most importantly, with no financial commitments. The way EU countries are currently raising military spending, through debt mostly, and without common procurement, will reinforce their dependency on the US and US-dominated financial markets. At no point did the EU have an agreed end-game strategy for Ukraine – something that goes beyond wishful thinking.

But the EU has a few, sadly neglected, assets. It has a customs union, a single market and a single currency. They don’t win wars, but they matter. If the EU had not fallen behind the US in productivity growth, and if it had not given up on 21st technologies, the EU would be a formidable soft power. The threat of being banned from the world’s largest single market would have been a real choke-hold. The purpose of frugal fiscal policies is not to pay homage to a protestant work ethic, but to give financial headroom to act during emergencies.

If you accept, as everybody seems to do, that treaty change is impossible, an intelligent soft power strategy is the only thing that is left. But that would have meant a lowering of ambitions: no Green deal; no anti-tech legislation; the completion of the banking union with the goal to end the bank-sovereign nexus. In particular, it would have meant more integration.The balance between widening and deepening is way off.

For the talking heads that roam our airways and social media, it is cooler to talk about foreign policy. But for the EU it would be better if its leadership took an interest in the work of standard committees. They should not invite Zelensky to their European Council meetings, but the three economics Nobel Laureates, to give a presentation of the importance of technology to economic growth. The creeping death of the single market is the real existential crisis of the EU. It is not Trump.

If the EU wants to acquire hard power, that would have to be preceded by political reforms: treaty change to establish the EU as a federal union, with tax raising and debt issuing powers, money to fund an army, and a politically accountable military command structure. You don’t acquire hard power with people sitting around tables.

The EU’s tragedy is that it abandoned the necessary to seek the impossible.

Treaty Change Impossible

Yes, I do accept that a treaty change is impossible unless and until some currency crisis forces that outcome.

I have been writing about this for years.

The EU is governed by nannycrats with impossible goals and no way to act on them.

The Green Deal is now dead. Trump demand 5 percent military spending when budget constraints are such that 2 percent will be a struggle.

The US strives to innovate. The EU strives to regulate. It wants to regulate AI without knowing what AI is even about.

EC fines X €120 million under the Digital Services Act

Please note that on December 4, the EC fines X €120 million under the Digital Services Act

Deceptive design of X’s ‘blue checkmark’

X’s use of the ‘blue checkmark’ for ‘verified accounts’ deceives users. This violates the DSA obligation for online platforms to prohibit deceptive design practices on their services. On X, anyone can pay to obtain the ‘verified’ status without the company meaningfully verifying who is behind the account, making it difficult for users to judge the authenticity of accounts and content they engage with. This deception exposes users to scams, including impersonation frauds, as well as other forms of manipulation by malicious actors. While the DSA does not mandate user verification, it clearly prohibits online platforms from falsely claiming that users have been verified, when no such verification took place.

Lack of transparency of X’s ads repository

X’s advertisement repository fails to meet the transparency and accessibility requirements of the DSA. Accessible and searchable ad repositories are critical for researchers and civil society to detect scams, hybrid threat campaigns, coordinated information operations and fake advertisements.

X incorporates design features and access barriers, such as excessive delays in processing, which undermine the purpose of ad repositories. X’s ads repository also lacks critical information, such as the content and topic of the advertisement, as well as the legal entity paying for it. This hinders researchers and the public to independently scrutinise any potential risks in online advertising.

Nannycrat Nonsense

Seriously, doesn’t the EU have anything better to do than worry about blue checkmarks on X?

Unfortunately, this kind of nannycrat nonsense is all that the EU can do.

Q: Why?
A: Because, with few exceptions, it takes unanimous or nearly unanimous agreement to do anything.

So the EU launches commissions and studies again and again and again because commissions and studies are the only thing that can be approved.

By treaty, France has veto power over anything agricultural (every nation actually, but France and Italy are at the forefront). Global trade summits fail every year because of single-nation veto power. It useless to even invite the EU because the outcome is known from the beginning.

Germany and other Northern European countries have veto power over budget rules. That won’t change until German banks blow sky high, if then.

In the rare case the EU ever does anything, it’s usually wrong. Green energy, carbon border taxes, and the ridiculous digital services act are good examples.

Spotlight AI

The competition on AI is massive. Globally it’s the US vs China. But within the US there are four key players.

• OpenAI: OpenAI developed ChatGPT and the GPT models. It is a leader in conversational AI and foundational models.

• Anthropic: Anthropic is an AI safety and research company. It develops the “Claude” family of large language models. It is known for its constitutional AI framework.

• xAI: xAI is Elon Musk’s AI venture. It developed the Grok chatbot, with integration with Tesla and robotics.

• Perplexity AI: Perplexity AI operates an AI-powered search engine. It uses large language models and real-time web search to provide cited answers.

AI Q&A

Q: Where is the EU?
A: The EU is not in the ballpark. It’s not even close to the ballpark.

Instead, EU nannycrats are in a sand playbox 2,000 miles away trying to regulate the damn thing.

France’s big concern is not AI but to protect the family farm.

Protecting Family Farms in France:

• Combating Unfair Competition: Farmers protest against free-trade deals (like Mercosur) that they argue flood the market with cheaper products, undermining French standards and viability.
• Rural Livelihoods: Supporting family farms is seen as vital for food security, rural jobs, and maintaining the French countryside’s character. 
• Economic Support: France relies on EU subsidies, but farmers demand fairer distribution, with new rules pushing for eco-friendly practices while trying to prevent large farms from monopolizing funds.
• Legal Protections: Laws aim to shield farmers from “abusive” lawsuits by new residents over noise (like roosters) or smells, preserving traditional agricultural practices.

Mercosur Deal Update

Hooray! I am pleased to report that political agreement on Mercosur was reached in December 2024 after 25+ years of talks.

However, ratification hinges on member states.

Yet, on December 19, Politico reported EU delays Mercosur signing as 25-year curse drags on

An eleventh-hour turnaround from Italian Prime Minister Giorgia Meloni upended a self-imposed objective of signing the agreement with the Mercosur countries on Dec. 20 — pushing the decision to mid-January instead, POLITICO first reported.

The delay shows that after two decades of negotiations and countless turn-arounds, the EU-Mercosur pact, designed to create one of the world’s largest free-trade areas between the EU, Brazil, Uruguay, Paraguay and Argentina, continues to be a political minefield in Europe.

“Mercosur plays a central role in our trade agreements,” said European Commission President Ursula von der Leyen on her way into the leaders summit on Thursday morning, adding it was “of enormous importance we get the green light.”

Yet Meloni derailed the carefully laid plan.

Brazil’s President Luiz Inácio Lula da Silva said the Italian leader promised him on a call Thursday that she would support the deal as soon as she secured the backing of Italy’s farmers. Despite heaping pressure on Europeans in recent days, Lula ended up accepting the delay, the diplomats said.

Meloni’s pushback meant there was not enough backing from EU countries for von der Leyen to fly to Brazil this weekend to sign the deal as planned — despite the huge political capital invested on each side in trying to finalize it by the end before Christmas.

Even if Rome and Paris come around, the agreement’s troubles are far from over: The deal must still pass through the European Parliament, where opposition is mounting across the political spectrum.

“It seems certain that it [the Mercosur deal] will be signed in mid-January,” a senior German official told reporters.

The mid-January date is important, the official stressed, to get the agreement ratified before the Parliament has a chance to vote on a resolution to send the deal to the Court of Justice of the EU — which would risk freezing its ratification for up to two years.

Dealing With the EU

Mercosur is the perfect example of what it’s like dealing with the EU. Any country can damn near block any deal for any reason, or no reason at all.

I repeat my congratulations to the UK for escaping this madness. Of course, the UK has not made the best of Brexit, but that is the fault of UK politicians, not the Brexit vote itself.

Regulation and roadblocks are all the EU knows how to do. That’s why Google, Amazon, Microsoft, Tesla, Nvdia, and all the key AI players outside of China are in the US. The EU would regulate them to death before they ever got going.

To repeat: The US strives to innovate. The EU strives to regulate. Deals take 25 years. Knowing that, one would have to be crazy to want back in.

Tyler Durden Tue, 12/30/2025 - 07:20

The World Is Hopeful For A Better 2026

Despite ongoing conflicts, uncertainty over what Trump era 2.0 will bring next and the imminent climate catastrophe, global optimism is holding firm for 2026.

As Statista's Anna Fleck details below, according to the latest data from Ipsos, an average of 71 percent of respondents across 30 countries said they felt optimistic that their 2026 will be better than 2025.

This is the same share as last year and 16 percentage points up from 2023, which had the lowest score on record since Ipsos started running the survey.

You will find more infographics at Statista

Of course, a global average hides the differences between countries.

For instance, when looking at national breakdown, Indonesia has a high share of people feeling positive about their coming year. Out of the 30 countries polled, it comes out on top, with 90 percent of respondents feeling more optimistic about 2026. This is the same as last year.

At the more cynical end of the spectrum stand France and Japan, with only 41 percent and 44 percent of their respondents, respectively, feeling more positive about the coming year. France saw a nine percentage point drop from last 2024, following a year of political turmoil in 2025. Meanwhile, Japan’s low score is actually a six percentage point increase on its 2024 figure. South Korea and India were the two countries to see the largest gains, with a nine percentage point increase year-on-year.

Optimism has faltered slightly in the United Kingdom, down three percentage points from last year to 58 percent, while 66 percent of U.S. respondents said they felt optimistic about the coming year (-4 p.p.).

Tyler Durden Tue, 12/30/2025 - 06:55

Kazakhstan Crude Production Dips 6% After Black Sea Drone Attack

By Charles Kennedy of OilPrice.com,

Following the Ukrainian drone attack that damaged a key export terminal on Russia’s Black Sea at end-November, Kazakhstan’s crude and condensate production has fallen by 6% so far in December compared to the average output in November, an anonymous industry source told Reuters on Monday. 

A Ukrainian attack damaged infrastructure through which the Caspian Pipeline Consortium (CPC) exports most of Kazakhstan’s oil near the Russian port of Novorossiysk on the Black Sea. 

Oil has continued to flow, but at lower rates, while Kazakhstan sought to re-route some exports away from the Black Sea to keep supply relatively steady. 

CPC operates the pipeline from the Caspian coast in northwest Kazakhstan to the Novorossiysk port, which handles 80% of Kazakhstan’s crude exports from giant oilfields operated by international oil firms. 

Affiliates of Chevron and ExxonMobil are also minority shareholders in CPC, with the Russian Federation as its largest shareholder with a 24% stake.

As a result of the damaged infrastructure at the CPC export terminal, crude and gas condensate output from Kazakhstan dropped by 6% between December 1 and 28, down compared to an average of 1.93 million barrels per day (bpd) in November, according to Reuters’ source.  

Production at the giant Tengiz oilfield on the Caspian Sea, operated by a consortium led by Chevron, has also fallen this month. Output dipped by 10% to 719,800 bpd in the period December 1 through December 28, the source told the publication.

Earlier this month, Kazakhstan said it would reroute some of the oil from at its giant Kashagan oilfield toward China. 

In view of urgent repairs at one of three single-point moorings and deferred loadings, Kazakhstan works on rerouting part of its crude exports, Kazakhstan’s Energy Ministry told Reuters nearly three weeks ago. 

Kazakhstan is also diverting more of its westbound exports to the Baku-Tbilisi-Ceyhan (BTC) pipeline to the Turkish Mediterranean coast after the attack, multiple industry sources told Reuters in early December.  

Tyler Durden Tue, 12/30/2025 - 06:30

Europe's Ideological Paralysis Threatens AI Boom

Submitted by Thomas Kolbe

Economic prosperity is created in free markets by innovative companies. Over 50 percent of globally operating AI unicorns are located in the U.S., while Europe plays virtually no role. The race for the next future technology is already decided.

It seems that economic history is repeating itself in these months. On the stock markets, companies in the artificial intelligence and data center sectors are being traded feverishly. Massive capital flows into this technology. Much of it resembles the dot-com boom 25 years ago.

Structurally and regionally, little has changed since then: The U.S. and China are fighting for pole position, while the European Union’s economy remains largely on the sidelines, pushed into a spectator role by EU regulators.

Unicorns as a Measure of Innovation

An interesting measure of the EU’s lag in artificial intelligence is the number of so-called unicorns—private startups valued at at least one billion U.S. dollars before going public. This metric is considered a valid indicator of a region’s innovative capacity—and for the EU, the comparison with the U.S. is catastrophic.

About 1,700 such innovative companies currently operate in the U.S., while the EU has only around 280. The U.S. dominates this market with over 50 percent share, whereas the European economy lags far behind with less than ten percent of the global market.

This economic gap is also reflected in investment volume. Hyperscalers such as Amazon, Microsoft, Alphabet, and Meta invested over $320 billion in AI and corresponding data center infrastructure this year alone. More than 550 new projects—with a focus in Virginia, Texas, and Arizona—are forming the backbone of a new economy.

Data center capacity in the U.S. grew by around 160 percent this year, while Europe’s capacity increased by only about 75 percent, equaling an investment volume of just under €100 billion.

With investments of around $125 billion, China’s economy also lags far behind the American one. An interesting context—especially from the perspective of European, and particularly German, policymakers—is that nuclear power is gaining noticeable momentum in these regions.

Even if green-minded Germany refuses to acknowledge it due to its ideological stance against nuclear energy, the enormous energy demand of new technologies will in the future be covered to a significant extent by the expansion of nuclear power.

Among the few major projects in the European Union are the Brookfield project in Sweden, with an investment volume of around $10 billion, and the Start Campus in Portugal, which could also activate nearly $10 billion in investments.

Crash of Ideologies

Especially in AI, the ideological clash between the U.S. and the EU can be observed in practice and in all its consequences. While the U.S. relies on deregulation and private solutions, removing barriers for intense competition, EU Europe still adheres to the mantra of political global control. Nothing may happen unless Brussels officials have schemed it at their green table in all their wisdom.

The Draghi motto still applies here: Only massive public investments—credit-financed and centrally planned—will, in the view of EU statist planners, help overcome the enormous gap between Europe and the U.S.

In the simulations of the EU Commission’s master plan, now stretched over seven years under Ursula von der Leyen, everything seems surprisingly simple, almost simplified. The EU’s Invest-AI plan intends to borrow around €50 billion in loans and invest them in selected projects in the coming years. This is supposed to trigger private investments of €150 billion, ultimately creating four AI gigafactories.

Welcome to the socialist textbook world of “Habeckonomics”: a system in which state projects like Northvolt repeatedly fail. Yet as long as public guarantees, subsidies, and state-guaranteed purchase prices are in prospect, the small flame of political hope continues flickering in Europe’s lukewarm wind.

As usual, we also observe the typical European jungle of funding programs, subsidies, and steering projects. These include “Horizon Europe,” which is meant to strengthen computing power in science, the RAISE pilot, and the Gen-AI-4-EU initiative, together investing another billion euros in the EU’s digital infrastructure.

The Power of Competition

The ideological clash between the two major economic blocks, the U.S. and the EU, is producing strange effects. While the open capital market in the U.S. lets startups sprout like mushrooms from fertile soil, EU regulation—especially under the Digital Markets Act—has fostered a predatory mentality. That this was likely the Eurocrats’ goal from the start comes as no surprise.

Brussels imposed more than €3.2 billion in competition fines this year, mainly targeting U.S. corporations. Brussels has degenerated into a bureaucratic leviathan—a parasitic glutton absorbing economic energy and generating ossified structures and economic vacuum.

In EU Europe, the motto is: the regulatory framework matters most—and the state takes its cut. That private industry prefers other locations and withdraws capital matters little to Brussels’ extraction experts.

Against the backdrop of Europe’s massive descent into a climate-socialist dystopia, it is surprising that the roots of libertarian economic thinking originate precisely on this continent. Consider the great economist Ludwig von Mises, who repeatedly pointed out that it is the entrepreneur who drives the engine of the market economy through profit-seeking, and that without exception, decentralized processes create prosperity—while state interventions regularly derail it.

Civilization-superior models like the free market sink in the waves of ideological EU infantilism. Its repressive climate socialism promotes the growth of corporatist structures in which politics and subsidized parts of the economy carry out the extraction, eliminating competition.

The rigid adherence to centrally planned control of the new tech industry tragically mirrors the timeline of the dot-com era. What Europe fails to understand is that groundbreaking innovation inevitably triggers an investment boom, often resulting in overinvestment and a stock market crash—but ultimately leaving economically profitable structures permanently woven into the existing economy.

As with companies like Amazon, Google, or Microsoft, Europeans will look back in a few years at these months and examine this intercontinental economic bifurcation through the examples of OpenAI, Gemini, or Perplexity. The energy needed will come from French nuclear reactors and soon also from Polish nuclear power.

Tyler Durden Tue, 12/30/2025 - 05:00

Where Do Microplastics Come From Anyway?

Most people know that plastic pollution is a problem, but microplastics (the tiny fragments shed by everyday products) are much more pervasive than many realize.

Microplastics are defined as plastic particles smaller than 5 mm.

These particles are found everywhere: in oceans, soil, drinking water, food, and even the air we breathe. Yet, the origins of these particles are often invisible to consumers.

Using data from the IUCN, CSIRO, and Elsevier, this graphic, via Visual Capitalist, by Made Visual Daily breaks down what actually makes up these particles and where they come from.

A breakdown of microplastic sources, compiled from multiple environmental studies:

The chart shows that the biggest contributor to microplastics is synthetic textiles, which account for 35% of the total. Tires (28%) and city dust (24%) are also major culprits, followed by road markings (7%) and a grab bag of other sources (6%).

How Do These Microplastics Enter the Environment?

Microplastics enter the environment in two main forms: primary and secondary.

Primary microplastics are released directly into the environment at a microscopic size. These include:

• Fibers shed from washing synthetic fabrics like polyester, nylon, or acrylic.

• Rubber dust worn from car and truck tires during normal use.

• Fragments in city dust from the abrasion of paints, soles, furniture, and building coatings.

• Plastic pellets (“nurdles”) lost during plastic manufacturing or shipping.

Secondary microplastics, on the other hand, are formed when larger plastic debris—like bags, bottles, or fishing gear—breaks down over time due to sunlight, wave action, and weathering. These degrade into smaller and smaller pieces, eventually becoming microplastics.

Both types are persistent, pervasive, and increasingly found in even the most remote ecosystems. Research shows that even atmospheric currents can transport microplastic particles across continents and oceans.

The Scale of the Problem

Scientists estimate that roughly 21 million tonnes of primary microplastics have accumulated across land and sea environments, with millions of tonnes found in both agricultural soils and ocean waters. To help readers grasp the sheer scale of this invisible pollution, the graphic visualizes this total as an area filled 10 feet (3 meters) deep across a span of 2 miles (3.2 kilometers).

As highlighted in our previous breakdown of the future of the world’s plastic, the accumulation of these invisible pollutants is a growing concern, with long-term impacts still being uncovered.

What Can Be Done?

Solutions will require both technological and behavioral changes. For instance, innovations like microfiber filters in washing machines, and the development of alternative materials for tires and textiles, could help reduce the release of particles at the source.

In the meantime, understanding where microplastics come from is a critical first step. As this breakdown shows, the issue goes far beyond just plastic straws and bags.

Explore more microplastic visualizations like Visualizing The Size of Microplastics on Voronoi, our data storytelling app.

Tyler Durden Tue, 12/30/2025 - 04:15

Ukraine's Zaporozhia Nuclear Plant Could Restart 18 Months After War Ends

By Michael Kern of OilPrice.com,

The Zaporizhzhia nuclear power plant in Ukraine, which has been under Russian control since early 2022, could resume operations within a year and a half after a potential end to the war, the head of the plant’s Russian operating company said on Monday. 

“If this (the end of the conflict) happens tomorrow, we will be ready to start up in mid-2027,” Ramil Galiyev, CEO of the Zaporizhzhya NPP Operating Organization, said, as carried by Russia’s state news agency RIA. 

The Zaporizhzhia nuclear plant is not operational and does not produce electricity, but needs power supply from external sources to cool the nuclear material and avoid a nuclear meltdown or disaster.

Zaporizhzhia is Europe’s biggest nuclear power plant in terms of installed capacity of 5.7 gigawatts (GW).

Located in Enerhodar, the nuclear power plant supplied about 20% of Ukraine’s electricity before the war. 

Earlier this year, the International Atomic Energy Agency (IAEA) began a process to help restore external electricity to the power plant, following weeks of diplomatic engagement with both Ukraine and Russia after the facility again lost all access to the national grid.

IAEA Director General Rafael Mariano Grossi announced that work had begun to re-establish off-site power through repairs to the damaged 750 kV Dniprovska and 330 kV Ferosplavna-1 transmission lines.

These lines, located on opposite sides of the front line, are essential for supplying the electricity needed to cool the plant’s six shutdown reactors and spent fuel.

Last week, Russian media claimed that the Trump Administration held talks with Russia over joint management of the Zaporizhzhia nuclear power plant, including the potential to use its power for crypto mining. The discussions, which have not been independently confirmed, were allegedly held without Ukraine’s participation, and likewise proposed resuming electricity supply to Ukraine, Russian newspaper Kommersant reported on Friday.  

Tyler Durden Tue, 12/30/2025 - 03:30

These Are The World's 5 Largest Megacities

By 2050, 68% of the global population is projected to live in urban centers, up from 55% today.

The world’s largest megacity, when measured by the combination of satellite imagery and census data, is Guangzhou, China.

Strikingly, the population has boomed by nearly 20-fold in just 50 years driven by China’s rapid economic rise.

This graphic, via Visual Capitalist's Dorothy Neufeld, shows the growth of the world’s megacities, based on data from the European Commission via Our World in Data.

The Rise of the World’s Megacities (1975-2025P)

Below, we show the rise of the top five largest cities worldwide—using satellite imagery and census data—not administrative borders:

Since 1975, the population of Guangzhou has expanded by 40.9 million. It has the equivalent population of the entire country of Canada.

During the 1990s, the city’s population growth accelerated, driven by trade and industrial activity. Located on the Pearl River Delta, north of Hong Kong, it stands as a key port and transportation hub.

Jakarta, Indonesia’s capital and the economic hub of Southeast Asia’s largest economy, has undergone massive expansion. Its population has surged by 29 million over the past five decades, reaching 38.1 million today.

Meanwhile, New Delhi, India has grown 398%, supported by rising incomes and urban migration. By 2030, the city is expected to gain nearly two million more residents, spanning a population of 33.3 million.

To learn more about this topic, check out this graphic on the world’s fastest-growing economies.

Tyler Durden Tue, 12/30/2025 - 02:45