Today, in the Calculated Risk Real Estate Newsletter: 3rd Look at Local Housing Markets in March

A brief excerpt:

This is the third look at several early reporting local markets in March. I’m tracking over 40 local housing markets in the US. Some of the 40 markets are states, and some are metropolitan areas. I’ll update these tables throughout the month as additional data is released.

Closed sales in March were mostly for contracts signed in January and February when 30-year mortgage rates averaged 6.96% and 6.84%, respectively (Freddie Mac PMMS). This was an increase from the average rate for homes that closed in February. This was before the recent surge in economic uncertainty and stock market volatility that might impact existing home sales.
...
Here is a look at months-of-supply using NSA sales. Since this is NSA data, it is likely months-of-supply will increase into the Summer.

Months in red are areas that are seeing 5+ months of supply now and might see price pressures later this summer.
...
Many more local markets to come!

There is much more in the article.

Trump Threatens Harvard's Tax-Exempt Status Amid Federal Funding Freeze

The standoff between woke elites at Harvard University and the Trump administration is growing more tense by the day. 

On Tuesday morning, President Trump wrote on Truth Social:

Perhaps Harvard should lose its Tax Exempt Status and be Taxed as a Political Entity if it keeps pushing political, ideological, and terrorist inspired/supporting "Sickness?"

Remember, Tax Exempt Status is totally contingent on acting in the PUBLIC INTEREST!

Trump's comments come a day after the U.S. General Services Administration and Department of Education froze $2.2 billion in grants to the woke Ivy League school, hours after it rejected the administration's demands to eliminate toxic DEI programs and screen international students for ideological concerns. 

Latest reporting:

• "Will Not Surrender" - Harvard Snubs Trump Admin's Demands Tied To $9 Billion funding

• Harvard To Borrow $750 Million Amid Federal Funding Uncertainty

Harvard President Alan Garber responded to the administration with a letter explaining why the university wouldn't comply with the demands: 

"No government — regardless of which party is in power — should dictate what private universities can teach, whom they can admit and hire, and which areas of study and inquiry they can pursue." 

What about the ones that receive billions of dollars of taxpayer funds per year??

Meanwhile, Harvard elites have a $53 billion endowment, which is tens of billions of dollars higher than Yale University's endowment ($10 billion). 

Universities like Harvard shouldn't be allowed to hide behind a tax-exempt status while promoting toxic wokeism.

Maybe it's time to reconsider taxpayer funding for the nation's oldest and wealthiest college... 

... which some continue to produce graduates indoctrinated with the woke mind virus.

*  *  *

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Click pic... buy seeds... take food supply into your own hands... Tyler Durden Tue, 04/15/2025 - 11:30

Trump Blames Biden, Putin, Zelenskyy For Ukraine War, Says He's Working To End It

Authored by Tom Ozimek via The Epoch Times,

U.S. President Donald Trump blamed former U.S. President Joe Biden, Russian President Vladimir Putin, and Ukrainian President Volodymyr Zelenskyy on Monday for the continuing war in Ukraine, saying it’s not his war and vowing once again to bring it to a swift end.

Trump’s comments on April 14 on a social media post and at the Oval Office came a day after Zelenskyy’s appearance on CBS’s “60 Minutes.” The Ukrainian leader criticized the Trump administration’s claims that Ukraine shared responsibility for the war, calling them part of an “altered reality.”

“The war between Russia and Ukraine is Biden’s war, not mine,” Trump wrote on Truth Social. 

“I just got here, and for four years during my term, had no problem in preventing it from happening. President Putin, and everyone else, respected your President!”

Trump accused both Biden and Zelenskyy of doing “an absolutely horrible job” in allowing the war to erupt, saying there were “so many ways of preventing it from ever starting.”

Speaking later to reporters in the Oval Office, Trump said that Putin also shared responsibility. “Biden could have stopped it, and Zelenskyy could have stopped it, and Putin should have never started it,” he said. “Everybody’s to blame.”

Trump said his team is “making progress” in cease-fire efforts. Last week, his Middle East envoy, Steve Witkoff, met with Putin in St. Petersburg to discuss a U.S.-brokered peace deal.

While Ukraine has backed the cease-fire proposal, Russia has attached sweeping conditions that have effectively stalled the effort. Trump has urged Russia to “get moving” on a peace deal while emphasizing the devastating human toll of “a terrible and senseless war.”

Russia’s deputy envoy to the United Nations, Dmitry Polyansky, told state-run news outlet Tass on Monday that Witkoff’s visit could pave the way for a future Trump–Putin summit, though a formal cease-fire is unlikely before Easter.

Trump’s comments came just hours after a Russian missile strike hit the Ukrainian city of Sumy, killing at least 34 people, including two children, and injuring more than 100, according to Ukrainian officials.

The attack was the latest in a series of recent airstrikes and drone attacks that have drawn sharp condemnation from international leaders.

European officials blasted the Sumy strike as further evidence of Putin’s disregard for peace talks. Finnish Foreign Minister Elina Valtonen said the attack, which followed closely on the heels of Witkoff’s visit, “demonstrates that Russia shows full disregard for the peace process.”

French Foreign Minister Jean-Noël Barrot echoed the criticism, saying Putin has no intention of agreeing to a cease-fire.

Zelenskyy, in his “60 Minutes” interview, pushed back against Trump’s earlier claims that Ukraine may have provoked the war, saying: “There is an aggressor and there is a victim. The Russians are the aggressor, and we are the victim.”

Zelenskyy also appealed to Trump to visit Ukraine, see the devastation for himself, and “then let’s move with a plan how to finish the war.”

Tyler Durden Tue, 04/15/2025 - 11:10

BofA Reports Strong Results Boosted By Record Equity Trading, Budgets 4 Rate Cuts

It's deja vu all over again.

With bank earnings season coming to a rapid close, this morning we got results of the last 2 of the "Big 5", when Bank of America and Citigroup both reported Q1 earnings, and we doubt it will surprise anyone that the pattern observed over the past few days remained the same: blowout equity trading revenues, offset by disappointing FICC, and slowing Investment banking advisory and underwriting.

Taking a closer look at the bigger of the two, Bank of America joined JPM, Goldman and MS in posting record equity trading revenues as the bank reaped the benefits of soaring volatility and net interest income topped analysts’ estimates.

Revenue from equity trading rose 17% to $2.18 billion in the first three months of the year, helping the bank beat analysts’ estimates for per-share earnings. Meanwhile, trading of FICC (fixed income, currencies and commodities) missed estimates, bringing in $3.46 billion, below the $3.47 billion estimate.

BofA's sales and trading unit delivered its 12th consecutive quarter of year-over-year revenue growth, CEO Brian Moynihan said in the statement. “Our business clients have been performing well, and consumers have shown resilience, continuing to spend and maintaining healthy credit quality.”

Let's take a closer look at the bigger picture: here is what BofA reported for Q1.

• EPS $0.90, up 18% from the 76c a year ago and beating estimates of $0.82
   
• Revenue net of interest expense $27.4BN, up 12% YoY from $25.8BN and beating estimates of $27.1BN. This was the highest total revenue in more than a decade
  • Trading revenue excluding DVA $5.65 billion, beating estimates of $5.55 billion
    • Equities trading revenue ex DVA $2.18 billion, beating estimates of $2.06 billion
    • FICC trading revenue ex DVA $3.46 billion, missing estimates of $3.47 billion
    • Investment banking revenue $1.52 billion, missisng estimates of $1.55 billion
      • Debt underwriting rev. $942 million, beating estimates $856.4 million
      • Equity underwriting rev. $272 million, missing estimates of $324.8 million
      • Advisory fees $384 million, beating estimates of $421.1 million
• Net interest income $14.44 billion, beating estimate $14.36 billion
• Net interest income FTE $14.59 billion, estimate $14.57 billion
• Wealth & investment management total revenue $6.02 billion, estimate $6 billion
• Revenue net of interest expense $27.37 billion, estimate $25.78 billion
   
• Non-interest expenses $17.77 billion, estimate $17.62 billion

And visually:

Summary highlights from Q1 below:

 Net interest income was $14.6 billion, translating into a Net Interest yield which rose from 1.97% to 1.99% QoQ and was unchanged YoY, it also came in below estimates of 2%. The bank's blended cash and securities yield was 3.23% vs. total deposit rate paid of 1.79%. Some more details on these numbers: 

• NII increased $0.1B from 4Q24, driven by lower deposit costs, higher NII related to Global Markets (GM) activity, and fixed-rate asset repricing, partially offset by the impact of lower interest rates and ~($250MM) from two fewer days of interest accrual
• Increased $0.4B from 1Q24, as lower deposit costs, higher NII related to GM activity, and fixed-rate asset repricing more than offset the impact of lower interest rates and ~($125MM) from one less day of interest accrual

The bank's provisions matched net charge-offs at the bank, which remained flat, Chief Financial Officer Alastair Borthwick said on a conference call with reporters.

“Employment is obviously healthy, and consumers have proven resilient,” Borthwick said. “The spending across channels and the credit quality of our loan portfolio remains solid.”

Perhaps the most notable number in this context was the bank's net interest income outlook, specifically the bridge from the current $14.6BN number to the projected year-end number (which was left unchanged from last quarter) of $15.5-$15.7BN: here we find that BofA now officially budgets for 4 rate cuts this year: in May, July, Sept and Dec, which is somewhat at odds with BofA's view for no recession this year.

BofA's balance sheet, liquidity and capital were in line to somewhat stronger vs expectations:

• Basel III common equity Tier 1 ratio fully phased-in, advanced approach 13.3%, estimate 13.5%
• Standardized CET1 ratio 11.8%, estimate 11.8%
• Return on average equity 10.4%, estimate 9.37%
• Return on average assets 0.89%, estimate 0.82%
• Return on average tangible common equity 13.9%, estimate 12.6%

 Unlike JPMorgan, BofA did not report a spike in its loan loss reserve build, and instead its provision for credit losses was $1.45 billion (a 0.54% charge off ratio), unchanged QoQ and WoW, and below the estimate of $1.53 billion.

There were no surprises in the bank's deposit and loan trends:

• Loans $1.11 trillion, up 5.9% YoY and above the estimate $1.1 trillion
• Total deposits $1.99 trillion, also above the estimate $1.97 trillion

Turning to the expense side, total non-interest expenses rose 3.1% from a year earlier to $17.8 billion. Analysts had expected a 2.3% increase to $17.6 billion. Compensation expenses $10.89 billion, up $0.7bn QoQ and YoY, and above the estimate $10.84 billion; BofA's efficiency ratio dropped to 64.93% vs 66.77% y/y.

Looking at the most important aspect of today's report, the bank's Global Markets segment, here we find the abovementioned continuation of the already noted pattern: strong equity trading, mediocre everything else, to wit:

• Trading revenue excluding DVA $5.65 billion, beating estimates of $5.55 billion,
  • Equities trading revenue excluding DVA up17% to $2.18 billion, beating estimates of $2.06 billion; "driven by improved trading performance and increased client activity"
  • FICC trading revenue up 8% excluding DVA $3.46 billion, missing estimates of $3.47 billion, "driven by strong performance in macro products5 and continued strength in credit products"
  • Investment banking revenue $1.52 billion, missisng estimates of $1.55 billion
    • Debt underwriting rev. $942 million, beating estimates $856.4 million
    • Equity underwriting rev. $272 million, missing estimates of $324.8 million
    • Advisory fees $384 million, beating estimates of $421.1 million

Noninterest expense for the division rose 9% to $3.8BN, driven by higher revenue-related expenses and investments in the business, including people and technology

Of note, the average VaR for Markets soared from 64 a year ago and 68 in Q4 to a whopping 91 in Q1.

Wall Street commentary on BofA's earnings was generally upbeat:

Piper Sandler’s Scott Siefers

• Positive that 4Q25E net interest income expectations reiterated
• Strong quarter, fees and credit costs the main drivers
• Net interest income topped expectations, though expenses a touch higher than expected

UBS’s Erika Najarian

• “This print was much anticipated, and we think this should be ‘enough’ to bring some momentum back into the stock,” analysts led by Najarian wrote in a note
• “Net-net, results should be more than good enough, but the call is likely critical for more sustained outperformance — to note, we think this is a crowd favorite among money centers coming into earnings”

Citi’s Keith Horowitz

• Pre-provision net revenue beat Citi estimates, particularly strong in equities and net interest income; credit trends solid
• Truist’s John McDonald
• Result came in ahead of consensus driven by beats on provision and fees
• “Most importantly, BAC maintained its prior guidance for NII to increase throughout 2025 and finish 4Q25 at ~$15.5-$15.7b, even while now incorporating 4 Fed cuts of 25bps each into the guide”

Baird’s David George

• “Core pre-provision net revenue better than expected given fee upside in trading, credit holding up well,” the analysts wrote
• Fee income up about 18% quarter on quarter above expectations from strong markets activity, similar to universal peers

KBW’s David Konrad

• Stock should react favorably, trading at a 20% discount to peers
• Result largely as expected; equities strong

Shares of Bank of America, rose 4% to $38.12 in early trading. They’ve gained 5% in the 12 months through Monday, less than the 18% increase in the S&P 500 Financials Index.

BofA's Q1 investor presentation is below (pdf link)

 

The Presentation Materials_1Q25 by tyler

Tyler Durden Tue, 04/15/2025 - 10:55

"Ready To Start Production": AMD Prepares For First Made-In America Chip 

President Trump's 'America First' agenda—specifically, the revival of domestic critical supply chains to reinforce hemispheric defense—scored yet another win this week.

Reuters reported that Advanced Micro Devices' most advanced processor chips would soon enter series production at Taiwan Semiconductor Manufacturing Company's (TSMC) factory in Arizona. 

"Our new fifth-generation EPYC is doing very well, so we're ready to start production," AMD Chief Executive Lisa Su told reporters in Taipei earlier, referring to the company's server-grade processor line, designed for data centers, cloud computing, high-performance computing, and enterprise workloads. 

Shifting AMD's server-grade processor line to TSMC's Arizona facility marks the first time the U.S. company will produce these chips domestically, eliminating the supply chain risks associated with manufacturing at TSMC's Taiwan-based fabs. 

"We want to have a very resilient supply chain, so Taiwan continues to be a very important part of that supply chain, but the United States is also going to be important and we're expanding our work there, including our work with TSMC and other key supply chain partners," Su said. 

News that AMD's fifth-generation EPYC will be produced in America comes one day after Nvidia unveiled new initiatives aimed at strengthening America's chip manufacturing sector:

• Nvidia is localizing AI chip and supercomputer manufacturing in the U.S. for the first time, partnering with TSMC, Foxconn, Wistron, Amkor, and SPIL.

• Over 1 million square feet of manufacturing space has been commissioned for Blackwell chips and AI supercomputers in Arizona and Texas.

• Mass production of these chips is expected within 12–15 months.

• Total AI infrastructure by Nvidia could total $500 billion over the next four years.

Restoring U.S. chipmaking capacity is critical for several reasons, but national security stands above all. China can easily disrupt chip supply chains in Taiwan—something that could send shockwaves around the world, impacting U.S. defense production of missiles, tanks, and other critical systems, many of which rely on chips fabricated overseas. 

If the U.S. intends to compete—and win—in the 2030s, the ongoing expansion of domestic chip manufacturing is not just welcome news; it's essential for survival.

*  *  *

 Try IQ Biologix Astaxanthin - a super potent antioxidant (read more here).

Satisfaction guaranteed. If you think it's bullshit, or it just doesn't work for you, simply ask for a refund... Tyler Durden Tue, 04/15/2025 - 10:40

Stocks Tumble After EU Tariff Comments

Tariff headline roulette is back...

Just when you thought it was ok to BTFD, Bloomberg reports that things are not proceeding gleefully in EU-US trade talks.

The European Union and US made scant progress bridging trade differences this week as officials from President Donald Trump’s administration indicated that the bulk of the US tariffs imposed on the bloc will not be removed.

The EU’s trade chief, Maros Sefcovic, left the meeting with little clarity on the US stance, struggling to determine the American side’s aims, according to people familiar with the discussions. He met for about two hours with US Commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer in Washington Monday.

The US officials indicated that the 20% “reciprocal” tariffs — which have been reduced to 10% for 90 days — as well as other tariffs targeting sectors including cars and metals would not be removed outright, said the people, who spoke on the condition of anonymity.

And it is that last bit that upset markets, sending stocks back into the red after a solid short squeeze at the open...

The EU has offered that both sides remove all tariffs on industrial goods, including cars. The US has so far rejected that proposal.

Finally, we have to say that this note from BBG is barely even news...

For those who actually read the article and not just the flashing red headline which oddly enough came at the peak of this morning's rally, this is all it said
"The European Union and US made scant progress bridging trade differences this week" https://t.co/V7fmP8DKnI

— zerohedge (@zerohedge) April 15, 2025

It's almost as if someone wants to keep equity vol high and equity prices down?

Tyler Durden Tue, 04/15/2025 - 10:25

Who Holds The Cards In The Trade War: U.S. Or China?

He who produces or he who consumes. Who holds the power? If China cut off the United States, shelves could go empty in weeks. If the U.S. closes its doors to China, the country’s income would collapse ushering in a severe depression.

So should American’s count their blessings as they are showered with inexpensive goods or is “the customer always right”?

Tonight we will have our answer. Visit the ZeroHedge homepage tonight at 7pm ET for our Premium China Debate with Carnegie Endowment’s Michael Pettis and Z-Ben Advisors’ Peter Alexander. The event will be moderated by Michael Green of Simplify Asset Management. Each has studied China for decades and will provide the respective bear and bull case for the burgeoning superpower’s economic growth prospects. They will also weigh in on the ongoing U.S.-China trade war.

Bear Case From Pettis:

• China’s past economic success was driven by strong supply-side growth, especially during the 1980s to 2000s.

• The current major constraint is on the demand side, particularly domestic consumption, which is historically low.

• Weak consumption makes it difficult to grow the supply side without:

  • Increasing investment, which China is reluctant to do.

  • Expanding the trade surplus, which other countries are unwilling to accommodate.

• China is caught in an "Albert Hirschman trap":

  • Successful growth models eventually become obsolete.

  • Countries often struggle to transition away from outdated models due to political and economic barriers.

Pettis on Trump’s tariffs:

3/14
They are simply one of many industrial policy tools designed to tax consumption and subsidize production, and as such can be expansionary under certain circumstances and contractionary under others. In fact other policies can be much more effective.

— Michael Pettis (@michaelxpettis) April 3, 2025

Bull Case From Alexander:

• Massive leaps in automation and AI: DeepSeek, fully autonomous Shanghai port, etc.

• Influx in private capital investment from abroad, which continues to persist.

  • Recent demand for fixed income products — bonds from the government and banking sector — has naturally suppressed interest rates as opposed to artificial suppression by western central banks.

• Pundits calling for Chinese collapse for decades. Never materialized and in fact the opposite has been true.

• Chinese consumers are beginning to purchase Chinese products, which will lead to a higher standard of living domestically while reducing the amount of available goods for international consumers (like the U.S.).

We will see you tonight at 7pm ET. Sub to ZH premium or pro now so you don’t miss it.

Tyler Durden Tue, 04/15/2025 - 09:05

Sony Hikes Playstation 5 Price Up To 11% In Major Markets - Except The US

Sony, citing inflation and 'fluctuating exchange rates,' has hiked the price of the Playstation 5 in several regions - but is shielding US consumers from the decision.

The Sony Playstation logo is seen at the Paris Games Week (PGW), a trade fair for video games in Paris, France, November 5, 2023. REUTERS/Claudia Greco/File Photo

The company said it was a "tough decision" to raise PS5 prices for the first time in three years.

"With a backdrop of a challenging economic environment, including high inflation and fluctuating exchange rates, SIE has made the tough decision to raise the recommended retail price of the PlayStation 5 console in select markets in Europe, Middle East and Africa (EMEA), Australia and New Zealand," the company said in a statement, and confirming to Gamespot that US prices will remain the same.

Analyst Daniel Ahmad suggested that "The knock on effect [of tariffs] in terms of inflation, exchange rates, and macro trends" may cause Sony to raise prices globally.

Everyone is about to find out that the PS5 price won’t just increase because of tariffs. The knock on effect in terms of inflation, exchange rates, and macro trends also impacts global pricing.

Even if one region is impacted, Sony may raise prices everywhere to offset losses. https://t.co/qJDNe3EtfN

— Daniel Ahmad (@ZhugeEX) April 13, 2025

According to Gamespot, the changes are as follows;

Europe

• PS5 Digital Edition - €50 increase from €450 to €500
• PS5 Standard with disc drive - No price change
• PS5 disc drive - €40 decrease from €120 to €80

UK

• PS5 Digital Edition - £40 increase from £390 to £430
• PS5 Standard with disc drive - No price change

• PS5 disc drive - £30 decrease from £100 to £70

Australia

• PS5 Digital Edition - AUD $70 increase from AUD $680 to AUD $750
• PS5 Standard with disc drive - AUD $30 increase from AUD $800 to AUD $830
• Ps5 disc drive - AUD $35 decrease from AUD $160 AUD $125

New Zealand

• PS5 Digital Edition - NZD $60 increase from NZD $770 to NZD $860
• PS5 Standard with disc drive - NZD $50 increase from NZD $900 to NZD $950
• PS5 disc drive - NZD $30 decrease from NZD $170 NZD $140

Interesting, eh?

The U.S. price stays the same because here, we still have leverage.

This is what economic nationalism looks like in practice.

When America puts its foot down, even Japanese tech giants know not to test the waters.

— Hank™ (@HANKonX) April 15, 2025

lol. They’re making the Europeans pay for trumps tariffs?

— Cunha (@Cunha_D_) April 15, 2025

Europe: paying 10% more to get no girlfriend in higher resolution

— Brunbitty (@brunbitty) April 15, 2025

This is exactly what Nike will do. They’ll increase rest of world pricing to subsidize the US.

— Truth Magnate (@TruthMagnate) April 15, 2025

 

Tyler Durden Tue, 04/15/2025 - 08:55

Empire Fed Manufacturing Expectations Plunge To Worst Since 9/11

Despite the slump in 'soft' survey data, analysts expected Empire Fed Manufacturing to bounce back from March's tumble to one year lows and they were right with the headline index rising from -20.0 to -8.1 (considerably better than the -13.5), but still negative. However, while current conditions jumped, expectations plunged to the lowest since 9/11/...

Source: Bloomberg

The gauges of future bookings and shipments dropped to the lowest in data back to 2001.

“After declining sharply last month, business activity continued to contract modestly in New York State in April. Input and selling price increases picked up to the fastest pace in more than two years. Firms turned pessimistic about the outlook for the first time since 2022.” 

~Richard Deitz, Economic Research Advisor at the New York Fed

An index of current prices paid for materials increased nearly 6 points to 50.8, the highest since August 2022, while a gauge of prices received by manufacturers in the state also rose to a more than two-year high. 

The figures, in addition to increases in price expectations, indicate higher tariffs are contributing to inflationary pressures.

The New York Fed’s gauge of current new orders and an index of shipments shrank at slower rates.

Are they interviewing the same people as the UMich surveyors?

Tyler Durden Tue, 04/15/2025 - 08:41

Futures Drop In Jittery Session, Dollar Extends Losses

US stock futures swung between gains and losses after a two-day advance as traders focused on signs that the Trump administration may add more tariff exemptions to ease the economic turmoil of the trade war. As of 8:00am S&P 500 were down -0.3% and Nasdaq futures dipped -0.2%, although both indexes were in the green just minutes earlier with moves now happening so fast and jittery, it has become meaningless to keep tabs. Boeing sank 4% in premarket trading after China ordered airlines not to take any further deliveries of the company’s jets; elsewhere, Mag7 and Semis are leading TMT higher with Fins higher into earnings. Other Cyclicals like Energy/Industrials are mixed with Materials higher led by gold miners. In Europe, stocks pushed higher after Trump floated a pause in auto tariffs.  Bond yields are +/- 1bp as the curve twists flatter; USD is flat as it looks to ease 5 consecutive days of losses. The commodity complex is weaker with crude and base weaker, gold up, and Ags mixed. The macro data focus is on import/export prices and Empire Mfg plus earnings from GSIB Banks, transports, and a HC (and Defensives factor) bellwether, JNJ.

In premarket trading, Mag7 stocks are mixed (Apple -0.5%, Nvidia -0.2%, Amazon +0.07%, Meta +0.2%, Tesla -0.4%, Alphabet +0.5%, Microsoft +0.2%). Boeing falls 3% after Bloomberg reported that China had ordered its airlines not to take any further deliveries of the planemaker’s jets.Here are some other notable premarket movers:

• Allegro MicroSystems (ALGM) drops 10% after ON Semiconductor withdrew its $6.9 billion bid to acquire the company.
• Applied Digital (APLD) slumps 11% after the data center operator posted quarterly results that missed expectations in terms of revenue and adjusted Ebitda.
• Bank of America (BAC) climbs 2% after its stock traders posted a record quarter due to volatile markets.
• Coty (COTY) declines 4.4% after BofA downgraded the cosmetics company, based on a lower valuation for both the prestige and consumer beauty segments due to slowing growth.
• Hexcel and Howmet shares decline as Wells Fargo downgrades both, turning more cautious on the aerospace sector to reflect impact from a global economic slowdown. (Hexcel (HXL) -2%, Howmet (HWM) -2%)
• Netflix (NFLX) climbs 2% after a Wall Street Journal report said the company aims to double its revenue and reach a $1 trillion market capitalization by 2030.
• Precision Biosciences (DTIL) gains 6% after the FDA granted fast track designation for PBGENE-HBV, the company’s lead wholly owned in vivo gene editing program aimed at chronic hepatitis.
• Paramount Group (PGRE) drops 5% as Morgan Stanley downgrades the office property manager, noting that the San Francisco financial district continues to face demand headwinds.
• Rocket Lab (RKLB) climbs 4% after winning defense contracts in the US and UK.

Tuesday’s market moves were milder than the big swings of late, reflecting hopes that there may be room for negotiations over Trump’s reciprocal levies. Investors were also watching the early stages of the earnings season, with Bank of America topping analysts’ estimates. 

"The overall market mood is set on de"escalation,” said David Kruk, head of trading at La Financiere de L’Echiquier. “We got caught out last week with Trump’s reversal of fortunes, and this weekend as well, so we’re waiting before reacting now.”

The Fed’s President Raphael Bostic emphasized officials must wait for further clarity on President Donald Trump’s policies before adjusting interest rates. They will not get it: underscoring the uncertainty surrounding the trade war, China ordered its airlines not to take any further deliveries of Boeing jets, Bloomberg News has reported. The planemaker’s shares fell more than 3% in premarket trading. Rare earth mining stocks TMC and MP Materials are set to extend their gains.

The latest Bank of America fund manager survey struck a cautious tone, showing that a record number of global investors plan to cut their holdings of US equities. Among the respondents, 73% said that US exceptionalism has peaked. Elsewhere, Deutsche Bank CIO Christian Nolting says they will buy the dip if the S&P 500 falls closer to a recessionary level of 5,000. 

And speaking of Bank of America, its shares rose in premarket after its stock traders posted a record quarter, as the company reaped the benefits of volatile markets. Elsewhere, Johnson & Johnson helt its profit outlook steady despite the potential for tariffs.

In Europe, the Stoxx 600 rose 0.9%, off session highs, led by gains in automakers after US President Donald Trump said he is exploring possible temporary exemptions to his tariffs on imported vehicles and parts. Luxury names provide a drag as LVMH shares plunge 7% after sales fell more than expected in the first quarter; as a result LVMH was overtaken by Hermes as the world’s most valuable luxury company.  Here are the biggest movers Tuesday:

• European auto and auto parts stocks rise on Tuesday after US President Donald Trump said he is exploring possible temporary exemptions to his tariffs on the sector to give companies more time to set up US manufacturing
• Ericsson shares rally as much as 11% after the telecom equipment maker gave a stronger-than-expected margin guidance for its core networks division even after factoring 1 percentage point hit due to tariffs
• Beiersdorf shares rise as much as 3.5% after the German firm reported organic sales for the first quarter that beat estimates. Analysts say the market should be relieved due to concerns around beauty sector growth
• Publicis shares rise as much as 3.7%. The advertising firm reiterated its outlook for the year as new business was strong enough to offset the impact of a deteriorating macroeconomic environment
• Galp rises as much as 2.2% to €13, and trades 1.9% higher as of 8:28 a.m. in Lisbon. Portuguese oil company reported refining margin for the first quarter that beat the average analyst estimate
• B&M European Value Retail shares rise as much as 7.5%, the most since mid-2023, after the discount retailer said annual earnings are expected to be above the mid-point of its guidance range
• TomTom shares soar as much as 22%, the most since 2012, after the navigation specialist posted sales and earnings above expectations in the first quarter
• LVMH shares fall as much as 8.4% and weigh on luxury peers after the French group’s fashion and leather goods organic sales missed expectations, reflecting weakness in China
• Arcadis drops as much as 6.6% after ING Bank lowers its rating on the Dutch engineering firm to hold from buy and sets a new Street-low target, citing short-term challenges such as US tariffs
• Domino’s Pizza Group drops as much as 4.2% after being downgraded by Barclays, with analysts worried that a mature market and cost headwinds could put stress on the pizza company’s business model

Earlier in the session, Asian stocks rose, with automakers helping to lead the charge after US President Donald Trump indicated a temporary reprieve from tariffs on imported vehicles and parts, adding to investor hopes for relief on some levies. The MSCI Asia Pacific Index gained as much as 1.3%, with TSMC and Toyota among the top contributors. Benchmarks in Japan, Singapore and Taiwan rose 1% or more. Stocks in China and Hong Kong fluctuated in the session, bucking the regional advance amid continued concerns over decoupling from the US, but ended higher. The MSCI regional gauge was on track for its first back-to-back daily gains since Trump announced the reciprocal tariff plan on April 2. Asian stocks have held up better than US peers in that span. Indian stocks rallied as trading resumed after a long weekend, with the benchmark equity index erasing all the losses triggered by US President Donald Trump’s reciprocal tariffs earlier this month.

In FX, the Bloomberg Dollar Spot Index was lower by 0.1%, on course for its longest losing streak in more than a year. The euro underperforms and is near flat versus against the greenback. The kiwi leads with a 0.7% gain while the pound adds 0.4%.

In rates, treasuries hold small losses across maturities, following bigger declines for German bonds after the oversubscription rate for a 5-year debt sale was the lowest since March 2023. And earlier in the day, the Japanese 20Yr bond sale drew the weakest demand ratio since Dec 2023, so slowly the global bond market is coming unglied. In the US, treasury yields are 1bp-2bp higher with curve spreads narrowly mixed, though 5s30s spread briefly exceeded Monday’s high; 10-year near 4.38% is higher by ~1bp vs 3.5bp increase for German 10-year. Gilts outperform their European peers, with UK 10-year borrowing costs falling 3 bps to 4.64% after UK businesses shed workers at the fastest pace since the start of the pandemic. 

In commodities, oil prices are steady, with WTI near $61.50 a barrel. Spot gold rises $10 to around $3,221/oz. Bitcoin climbs 1.2% toward $86,000.

Looking at today's calendar, the US economic calendar includes April Empire manufacturing and March import/export price indexes (8:30am). Fed speaker slate includes Cook at 7:10pm. Chair Powell speaks Wednesday to the Economic Club of Chicago about the economic outlook

Market Snapshot

• S&P 500 mini -0.2%, 
• Nasdaq 100 mini -0.3%, 
• Russell 2000 mini -0.2%
• Stoxx Europe 600 +0.9%, 
• DAX +1.1%, 
• CAC 40 +0.3%
• 10-year Treasury yield +1 basis point at 4.38%
• VIX -0.8 points at 30.05
• Bloomberg Dollar Index little changed at 1229.76
• euro -0.1% at $1.1338
• WTI crude little changed at $61.5/barrel

Top Overnight News

• US Treasury Secretary Bessent said he does not think there is a dumping of US assets in the bond market and said this is one of those occasional shocks you get in the trading community. Bessent said the US still has the global reserve currency and a strong dollar policy, as well as noted it is a long way from needing contingency plans. Furthermore, he is pleasantly surprised at how quickly the tax bill is moving along and noted that they are thinking about a successor for Fed Chair Powell with the interviewing of candidates to begin in the fall: BBG
• State Dept. could see its funding slashed by as much as 50% according to a White House memo, w/the administration proposing to essentially eliminate all funds for the UN and NATO. NYT
• White House NEC Chair Hassett said the US is in the 'sweet spot' of growth and that President Trump wants to see tariff money up front, while he does not see a recession at all: Fox Business
• US State Department is expected to propose an unprecedented overhaul of the US government’s diplomatic footprint overseas, including the elimination of entire embassies and consulates: Punchbowl
• Chinese port activity slumped in early April, with data indicating that exports to the U.S. have been hammered by President Trump’s tariffs. The cargo handled by ports across China over the April 7-13 period tumbled 9.7% from the week before to 244 million tons. That’s sharply weaker than the 0.88% loss registered during the previous week, when Trump first announced his plan for reciprocal tariffs. WSJ
• Chinese factories in Vietnam are seeing a “crazy” surge in orders as customers rush to get shipments during the 90-day pause window. SCMP
• Trump being pushed by some aides to take a tougher approach to Russia as Putin drags his feet on Ukraine negotiations. WSJ
• US will impose a 21% tariff on tomato imports from Mexico starting in Jul. BBG
• Treasury Sec Bessent downplayed the risk of foreign nations selling their US bonds and said he had a “big toolkit” to intervene and prevent a yield spike if needed (“we could up the buybacks if we wanted”). Bessent also said “everything is on the table” when asked about whether the reconciliation bill could raise taxes on the wealthy. BBG
• The biggest spending battle in Washington could start in May as Republicans begin the process of debating the Medicaid piece of the reconciliation bill. Politico
• The Commerce Dept formally proceeded with investigations into the drug and chip markets, the pretext required for the White House to eventually impose tariffs on both sectors. FT
• Oil consumption forecast cut by IEA - global oil demand growth for 2025 has been revised down by 300 kb/d since last month’s Report to 730 kb/d, as escalating trade tensions have negatively impacted the economic outlook. IEA

Tariffs/Trade

• China orders a halt to Boeing (BA) jet deliveries as the trade war expands, according to Bloomberg citing sources. Beijing has asked that Chinese carriers halt any purchases of aircraft-related equipment and parts from US companies Delivery paperwork and payment on some of these jets may have been completed before the reciprocal tariffs announced by China on April 11 took effect on April 12, and those planes may be allowed to enter China on a case-by-case basis, some of the people said.
• India Trade Official says the US and India have signed terms of reference for a trade deal; next round of India-EU talks are in May; India-UK trade negotiators are working to resolve pending issues
• Pakistan considers buying US crude to ease trade imbalance, via Reuters citing sources
• US President Trump said they will put tariffs on imported pharmaceuticals in the not-too-distant future and noted they do not make their own drugs, while he reiterated the EU is taking advantage of the US and has to come to the table which they're trying to. Trump also said he is looking to help car companies and there will maybe be some things coming up.
• US Treasury Secretary Bessent said US President Trump and Chinese President Xi have a very good relationship and noted that tariffs on China are big numbers and that no one thinks they are sustainable and wants them to remain. Bessent stated that tariffs on China are not a joke and that there doesn't have to be decoupling with China, but there could be and noted the US will negotiate tariff rates with partners in good faith and will run a robust process.
• US Secretary of Commerce initiated an investigation to determine the effects of national security of imports of pharmaceuticals and pharmaceutical ingredients and initiated Section 232 national security investigation of imports of semiconductors and semiconductor manufacturing equipment, according to the Federal Register.
• US Department of Commerce announced its intent to withdraw from the 2019 suspension agreement of fresh tomatoes from Mexico and with termination of the agreement, the Commerce Department will institute an anti-dumping duty order on July 14th, resulting in duties of 20.91% on most imports of tomatoes from Mexico.
• Argentina's President Milei says we understand the reciprocal tariffs from the US and are ready to sign a trade agreement along these lines.
• Chinese senior official for Hong Kong Affairs said the US tariff war goal is not to take Hong Kong's tariffs, "they want our life" and 145% tariff on Hong Kong is "brutally unreasonable, extremely shameless".

A more detailed look at global markets courtesy of Newsquawk

APAC stocks traded with a predominantly positive bias following on from the gains on Wall St where sentiment was underpinned by the recent US tariff exemptions and dovish comments by Fed's Waller. ASX 200 was led higher by strength in healthcare and financials but with the gains capped by a lack of fresh drivers and with very few clues from the RBA Minutes regarding when the next rate move will occur. Nikkei 225 outperformed with automakers among the best performers in the index after US President Trump suggested on Monday that he might temporarily exempt the auto industry from tariffs to give carmakers time to adjust their supply chains. Hang Seng and Shanghai Comp lagged with participants cautious after the US announced probes into pharmaceuticals and semiconductors, while local press noted domestic markets face liquidity pressures with more than CNY 570bln in reverse repo and MLF funds maturing this week, although the PBoC is expected to assist with liquidity.

Top Asian News

• RBA Minutes from the March 31st-April 1st meeting stated it is not yet possible to determine the timing of the next move in rates and it is not appropriate at this stage for policy to react to potential risks. RBA also commented that the May meeting would be an opportune time to reconsider and the decision was not predetermined, while it stated it is possible that global uncertainty over US tariffs could have a significant impact and the board saw risks on both the upside and downside for the Australian economy and inflation.

European bourses (STOXX 600 +1%) are almost entirely in the green, as the mostly positive risk tone in the APAC session reverberates into Europe. Price action so far has really only been one way today, and that’s up; as its stands, indices reside at highs. European sectors hold a strong positive bias, in-fitting with the positive risk tone. Consumer Products is the sole industry in the red today – thanks to the Luxury sector, which has been hampered by poor LVMH (-7.7%) results. Autos parks itself in top spot after US President Trump said he is looking to help car companies and that there will maybe be some things coming up.

Top European News

• Barclaycard UK March Consumer Spending rose 0.5% Y/Y (prev. +1.0%). It was also reported that UK consumers plan to 'buy British' amid Trump's trade war with around 71% of respondents in a survey by Barclays wanting to support UK businesses by buying items that were "made in Britain", according to FT.
• ECB Bank Lending Survey: Credit standards for loans to firms tightened slightly further, and net loan demand moved back into slightly negative territory

FX

• The Dollar initially kicked off the session relatively contained with US (and global) tariff policy showing some stability after recent toing and froing. However, the index adopted more of a downside bias in early European trade. DXY briefly dipped under 99.50 following reports that China ordered a halt to Boeing (BA) jet deliveries as the trade war expands, according to Bloomberg citing sources. Ahead, there is little of note for the Dollar on the docket during the European session, with the focus turning (in the absence of tariff updates) to Fed Chair Powell's speech tomorrow on the economic outlook. As it stands, DXY currently resides in a 99.47-99.97 band.
• EUR is modestly firmer/flat. EUR/USD currently trades in a 1.1314-1.1378 range, well within Monday's 1.1188-1.1473 parameter. German ZEW was mixed with Current Conditions missing forecasts and Economic Sentiment contracting. ZEW highlighted that erratic changes in US trade policy are weighing heavily on German expectations. EUR saw short-lived two-way action on the data before returning to pre-announcement levels.
• JPY was modestly lower in early portion of the morning largely as a function of the positive risk environment. Though some modest strength in the JPY was seen around the aforementioned China/Boeing reporting, which weighed on risk sentiment, a move which has since continued to a current 142.69 low for USD/JPY.
• A positive session for Sterling as it remains underpinned by the softer Dollar, whilst trade updates on the US-UK front have been constructive. UK government sources via BBC have suggested that recent talks with the US on a trade deal have been making good progress. Elsewhere, UK jobs data was mixed and resulted in no immediate reaction for the Pound. GBP/USD has topped the peak from 3rd April (1.3207) and trades in a current 1.3165-1.3227 range.
• The Loonie is mildly firmer this morning as traders look ahead to the Canadian CPI prints later today which could shape expectations for tomorrow's BoC confab. Y/Y CPI is forecast at 2.6% (prev. 2.6%) whilst the Median and Trim metrics are seen ticking up to 3.0% from 2.9%.
• Antipodeans are both firmer benefitting from another leg lower in the Dollar coupled with hopes of Chinese stimulus to cushion the blow from US tariffs. The overall positive risk tone and the firmer PBoC reference rate setting also underpins the high-beta FX. The latest RBA minutes provided little fresh clues as it stated it was not yet possible to determine the timing of the next move in rates and it was not appropriate at this stage for policy to react to potential risks.
• PBoC set USD/CNY mid-point at 7.2096 vs exp. 7.3094 (Prev. 7.2110).

Fixed Income

• USTs are in the red, with some modest pressure seen in early European trade as the general risk tone improved - this took USTs to a 110-17 low. However, the tone was clipped by a BBG source report that China has ordered a halt to Boeing deliveries, a report which lifted USTs from the mentioned trough to just above opening levels of 110-21+; as such, USTs are closer to unchanged on the session with yields slightly mixed but the curve still flatter.
• Bunds were in the green but now flat having been pulling back from its 131.57 overnight high throughout the morning as the risk tone improves, as outlined above. Down to an initial 131.18 low but was lifted off that by around 15 ticks by the aforementioned China and Boeing update. Thereafter, a weak German 2030 Bobl outing led Bunds down to a fresh 131.02 trough.
• Gilts are firmer, gapped higher by 23 ticks to 91.72 before pulling back modestly to a 91.67 trough as the tone improved. However, the discussed Boeing-China report moved the benchmark above opening levels and to a 91.93 peak. Follows the morning’s labour market data, the series didn’t really spark much movement in GBP at the time. In brief, the series points to a continued cooling of the labour market and while the employment metrics are net-dovish for the BoE, the cooling is yet to materialise significantly in wages which remain elevated. Nonetheless, the series has been superseded by more timely tariff updates. The 2035 auction was broadly in-line with the prior, a slightly lower yield on offer which tailed a touch less than last time though the cover was softer.
• UK sells GBP 4bln 4.5% 2035 Gilt: b/c 2.85x (prev. 2.92x), average yield 4.638% (prev. 4.679%), and tail 0.4bps (prev. 0.5bps).
• Germany sells EUR 3.549bln vs exp. EUR 4.5bln 2.40% 2030 Bobl: b/c 1.4x (prev. 1.90x), Average yield 2.06% (prev. 2.44%) & retention 21.1% (prev. 23.76%)

Commodities

• Crude began the European session modestly firmer, with upside facilitated by a softer Dollar and broadly positive risk-tone. However, more recently, the complex has gradually edged lower and now resides just off session lows. Some of the pressure could be attributed to China halting Boeing jet deliveries (hitting sentiment) and the IEA cutting its 2025 oil demand forecast. Brent Jun'25 currently towards the lower end of a USD 64.66-65.40/bbl range.
• Precious metals are mixed, with spot silver a little lower whilst spot gold edges higher. XAU currently higher by around USD 20/oz and sits above USD 3,230/oz in a USD 3,210.05-3,232.72/oz range.
• Mixed trade across base metals as traders weigh the demand impact from a US-Sino trade war with expected Chinese stimulus. That being said, some desks expected the base metals complex to continue trending lower, contingent on the scope of tariffs and the time in force. 3M LME copper resides in a 9,154.35-9,249.05/t range.
• EU is reportedly exploring legal options for ending Russian gas deals, according to FT.
• IEA OMR: cuts 2025 oil demand forecasts amid tariffs; sees 2026 surplus; cuts 2025 forecast to 730k BPD from 1.03mln BPD. Escalating trade tensions have negatively impacted the economic and oil demand outlook IEA, in first detailed look at balances for 2026, says world oil demand growth to slow further in 2026 to 690k BPD IEA cuts 2025 global supply growth forecast by 260k BPD to 1.2mln BPD due to a decrease in US and Venezuelan output

Geopolitcs: Middle East

• "IRGC says Iran's military capabilities are 'red lines' in any talks with US", according to Sky News Arabia
• US State Department said Secretary of State Rubio spoke to the Turkish Foreign Minister about dangers to regional security and stability posed by Iran and its proxies.
• White House Envoy Witkoff said the conversation with Iran will be about verification on the enrichment program and then ultimately verification on weaponisation.
• Houthi media reported US warplanes launched two raids on Al-Abdiya district in Marib and three raids on the areas of Al-Juhf and Al-Qadeer in Al-Hazm District in Al-Jawf Governorate in Yemen.
• Yemeni pro-government militias are planning a ground offensive against Houthis in an attempt to take advantage of a US bombing campaign that has degraded the militant group's capabilities, according to WSJ citing Yemeni and US officials.
• "Iran is expected to oppose a US plan to transfer its stockpile of highly enriched uranium to a third country such as Russia", according to Sky News Arabia.
• Next round of Iran-US talks will be held in Muscat, Oman, on April 19th, according to IRNA. Reporting on Monday intimated that the next round would be in Italy

Geopolitics: Ukraine

• Russian Defence Ministry says Ukraine Carried out six attacks on Russian Energy infrastructure over the past 24 hours, via Ria.
• Russia's Head of the Foreign Intelligence Service Naryshkin says in the event of NATO aggression against Russia or Belarus, damage will be inflicted on NATO as a whole; Poland and Baltic states will suffer first, according to Ria.
• Russia's Head of the Foreign Intelligence Service Naryshkin says Russia continues to comply with the moratorium on energy infrastructure strikes, according to Ria
• US President Trump said thinks they will get some very good proposals on stopping the Ukraine war very soon..
• Blasts reportedly shook the Russian city of Kursk near the Ukrainian border and damaged residential buildings.
• "Russian Foreign Minister: It is not easy to agree with the United States on the main aspects of a possible peace agreement to end the war in Ukraine", via Sky News Arabia.

Geopolitics: Other

• China's embassy in Argentina said it is strongly dissatisfied and firmly opposes US Treasury Secretary Bessent's remarks about China which it said "maliciously slandered, smeared" China for carrying out normal cooperation with other countries, while it added that some people with ulterior motives are trying to sow discord between China and Argentina. Furthermore, it said they advise the US to adjust its mindset instead of spending time repeatedly smearing and attacking China, as well as meddling in the foreign cooperation of regional countries.
• China's Harbin Public Security Bureau said US NSA agents are on the wanted list for being involved in a cyberattack on the Asian Winter Games, while it traced down the three agents and two US universities involved in the implementation of cyber attacks.

US Event Calendar

• 8:30 am: Apr Empire Manufacturing, est. -13.5, prior -20
• 8:30 am: Mar Import Price Index MoM, est. 0%, prior 0.4%

DB's Jim Reid concludes the overnight wrap

Markets continued to stabilise over the last 24 hours, with the S&P 500 (+0.79%) posting back-to-back gains for the first time since the reciprocal tariffs were announced on April 2. The recovery followed the weekend exemption of smartphones and other electronics from the tariffs, which added to investor hopes that the direction of travel would now be towards tariff reductions. On top of that, sentiment got a further boost thanks to positive noises about trade negotiations, which added to the sense that the administration is focused on making deals that could see the tariffs come down. So that newsflow helped multiple asset classes to unwind their tariff-related moves, with Treasuries recovering and HY spreads tightening as well.

That move towards potential tariff exclusions was supported by comments from President Trump yesterday, who said that he was looking at exemptions around autos, saying “I’m looking at something to help car companies with it”. Moreover, the administration is also sounding positive about trade talks, with NEC director Kevin Hassett, saying there were “more than 10 deals where there’s very, very good, amazing offers made to us.” That said, there was an indication of further sectoral tariffs, as the Commerce Department announced it had started trade probes on April 1 into semiconductors and pharmaceutical imports.

Overall, this created a positive backdrop for risk assets, and there were clear indications that market stress was easing back again. For instance, the S&P 500 rose another +0.79%, whilst Europe’s STOXX 600 saw a larger +2.69% increase. The S&P did give up some of its +1.79% early gain, mostly due to the Mag-7 (-0.07%) which posted a modest fall. But the tech stocks most affected by the tariff exemptions still outperformed, including Apple (+2.21%) and ASML (+2.20%). Overall, it was a day of broad gains as 85% of the S&P 500 constituents advanced on the day, with automakers including Stellantis (+5.64%), Ford (+4.07%) and GM (+3.46%) outperforming as well after President Trump’s auto tariff comments. Volatility continued to fall back too, with the VIX index coming down a further -6.67pts to 30.89pts, its lowest since April 3. And in another sign of easing financial conditions, US HY credit spreads tightened for a second day, coming down -10bps to 409bps.

With the latest advance for equities, that now means that the S&P 500 has recovered to -4.67% beneath its level at the tariff announcement, and -12.01% beneath its mid-February peak. That’s clearly a significant decline, but it’s still some distance from a normal recession decline, or even some of the larger non-recession bear markets of recent years like 2022, which saw a -25% peak-to-trough fall. So it’s clear that investors aren’t convinced that a recession is inevitable just yet.

Whilst equities were recovering, arguably a bigger relief for investors was the recovery in the bond market, which eased fears about some sort of serious financial turmoil developing. Investors had already been alarmed, and last week’s +49.5bp jump in the 10yr Treasury yield was the biggest weekly jump since 2001, with the yield moving higher every day last week. However, that began to reverse yesterday, with the 10yr yield (-11.6bps) down to 4.37%, and this morning it’s fallen a further -2.3bps to 4.35%. The moves got further support later in the session thanks to dovish comments from Fed Governor Waller, who said that although “the tariffs after April 9 were very large, I still believe they would have only a temporary effect on inflation.”

A further relief for Treasuries came from the New York Fed’s latest Survey of Consumer Expectations. It showed long-term inflation expectations were stable in March, with the 5yr measure actually coming down a tenth to +2.9%. So that will be a relief for the Fed, as the survey painted a very different picture to the University of Michigan’s survey, where long-term inflation expectations surged to multi-decade highs. Indeed, Chair Powell himself has spoken about how the Fed’s “obligation is to keep longer-term inflation expectations well anchored”, so it’s a crucial question for markets. It’s true that the NY Fed’s 1yr expectation measure rose half a point to 3.6% in the NY Fed’s survey, but even that was far more subdued than the University of Michigan’s number, where the 1yr measure was at +5.0% in March, and +6.7% in April.

Over in Europe, the sovereign bond rally also gathered pace, with 10yr bund yields coming down -5.8bps to 2.51%. So remarkably, the tariff developments have seen yields unwind nearly all of their rise after the German fiscal shift, as it was only just over a month ago (March 5) that 10yr bund yields saw their biggest daily jump (+29.8bps) since German reunification in 1990. Elsewhere, it was much the same picture, with yields on 10yr gilts (-9.7bps), OATs (-8.0bps) and BTPs (-13.3bps) all coming down as well. The moves also come ahead of this Thursday’s ECB decision, where it is widely expected to cut rates by another 25bps, which would take the deposit rate down to 2.25%.

Whilst most assets were unwinding their moves since Liberation Day, one exception to this pattern was the US Dollar, with the dollar index (-0.46%) falling to a 3-year low yesterday. So that was one sign that investors were still nervous about the outlook for US assets. But there were signs elsewhere that the tariff-related moves were unwinding in FX, as the Swiss Franc was the worst-performing G10 currency yesterday (having been the best performer since Liberation Day). Separately, gold (-0.82%) also fell back after seeing its strongest week since March 2020 last week.

Overnight in Asia, the major indices are mostly putting in a decent performance, following on from Wall Street’s gains yesterday. For instance, the Nikkei (+1.07%) and the KOSPI (+0.98%) have both posted decent advances. That’s been supported by several auto companies following the potential pause that was suggested, with strong gains for Toyota (+5.04%) and Honda (+4.02%). However, equities in mainland China have lost a bit of ground, with the CSI 300 (-0.06%) and the Shanghai Comp (-0.07%) posting a modest fall. And looking forward, futures on the S&P 500 (-0.06%) and the NASDAQ 100 (-0.09%) have also fallen back a bit, although in Europe, futures on the FTSE 100 (+0.32%) and the DAX (+0.38%) are in positive territory.

To the day ahead now, and data releases include UK unemployment and Euro Area industrial production for February, along with the German ZEW survey for April. From central banks, we’ll hear from the Fed’s Cook, and get the ECB’s Bank Lending Survey. Earnings releases include Citigroup and Bank of America.

Tyler Durden Tue, 04/15/2025 - 08:31

Eleven years ago, I wrote: Census Bureau: Largest 5-year Population Cohort is now the "20 to 24" Age Group.  Those people are now in the 30 to 34 cohort.

This month the Census Bureau released the population estimates for July 2024 by age, and I've updated the table from the previous posts.

The table below shows the top 10 cohorts by size for 2010, 2024 (just released), and the most recent Census Bureau projections for 2030.

In 2024, the top 6 cohorts were under 45 (the Boomers are fading away), and by 2030 the top 7 cohorts will be under 50.  Note: This is using the 2023 projections main series.  

There will be plenty of "gray hairs" walking around in 2030, but the key for the economy is the large cohorts in the prime working age.

As I noted in 2014, demographics were positive for apartments, and more recently positive for homeownership.

Population: Largest 5-Year Cohorts by Year Largest
Cohorts201020242030 145 to 49 years30 to 34 years35 to 39 years 250 to 54 years35 to 39 years30 to 34 years 315 to 19 years25 to 29 years25 to 29 years 420 to 24 years20 to 24 years40 to 44 years 525 to 29 years15 to 19 years20 to 24 years 640 to 44 years40 to 44 years45 to 49 years 710 to 14 years60 to 64 years15 to 19 years 85 to 9 years10 to 14 years50 to 54 years 9Under 5 years50 to 54 years65 to 69 years 1035 to 39 years55 to 59 years10 to 14 years

Click on graph for larger image.

This graph, based on the 2024 population estimate, shows the U.S. population by age in July 2024 according to the Census Bureau.

Note that the largest age group is in the early-to-mid 30s.  There are still a number of younger Boomers in their early-to-mid 60s.

"Magnitude Of Deterioration": Wall Street Stunned By LVMH's Earnings

LVMH Moët Hennessy shares dropped in Paris trading Tuesday after the luxury conglomerate reported Q1 earnings that fell short of Bloomberg Consensus estimates. The miss was driven by softening demand for high-end goods in top markets such as Asia and the U.S., as a deepening trade war pressured consumer sentiment. 

LVMH's first-quarter results served as a luxury gut-check for the industry, with a broad-based miss across segments and regions led by sliding demand in key markets, including China and the U.S. Fashion and Leather Goods — the group's growth engine — also stumbled, signaling concerns about a wider slowdown in the high-end consumer space. 

Here's a summary of the first quarter results: 

Red Flags:

Organic Revenue -3% vs. +1.1% est. (Bloomberg Consensus): A troubling miss, signaling a sharp deterioration in underlying business momentum.

China and U.S. Weakness:

• Asia ex-Japan -11% vs. -4.69% est.

• U.S. -3% vs. +1.19% est.

• These are core markets for LVMH, and their underperformance is very concerning, especially given the exploding trade war in recent weeks. 

Fashion & Leather Goods -5% vs. -0.55% est.: This is LVMH's crown jewel segment, and this large miss spooked investors.

Perfumes & Cosmetics -1% vs. +2.1% est. and Selective Retailing -1% vs. +3.69% est.: Both suggest consumers are dialing back on both essentials and discretionary luxury.

Geographic Weakness:

• U.S. organic revenue -3%, estimate +1.19%

• Asia excluding Japan organic revenue -11%, estimate -4.69%

• Japan organic revenue -1%, estimate +4.32%

• Europe organic revenue +2%, estimate +3.37%

Revenue Shortfall:

Total Revenue €20.31B vs. €21.14B est. (-1.9% y/y): This reflects how demand erosion is hitting the top line hard.

• Fashion & Leather -3.6% y/y vs. €10.56B est.

• Perfume & Cosmetics -0.2% y/y vs. €2.26B est.

Softening: 

• Wines & Spirits -9% vs. -4.49% est.

• Watches & Jewelry flat vs. +2.4% est.: Avoided contraction, but still a miss in the context of expected growth.

Commenting on LVMH's first quarter report, Goldman analyst Natasha de la Grense told clients:

The key thing that stood out to me on LVMH's Q1 miss was that the company attributed most of the slowdown to comp effects i.e. Chinese spending in Japan and Sephora in the U.S. This means we haven't yet seen the impact of recent events upon the business. Consensus assumes an acceleration to +1% (from -5%) for F&L in Q2 which won't happen given 1) the April shock to confidence, wealth effects and transatlantic tourist flows; 2) the fact that the comp in Japan gets 25 ppts tougher; 3) the Yen has strengthened vs RMB. Management said U.S. cluster spending was positive in Q1 for F&L but conceded "April might be different". We suspect that was supported by U.S. tourist spending in Europe which has softened given recent USD weakening/anti-US sentiment. GSe F&L -8% in Q2.

In a separate note, Goldman analysts Louise Singlehurst and others told clients that one key surprise in the earnings report was the "magnitude of the deterioration in the largest division, Fashion and Leather." She lowered her 12-month price target by 13% to 630 euros (from 725 euros). 

Here's more from Singlehurst:

Valuation - PT lowered by 13% to PT €630 (from €725): We continue to use a DCF valuation methodology for LVMH (8.5% WACC, 3.0% LT growth; unchanged). Our price target decreases 13% which reflects (i) a -10% decrease in our long-term earnings and FCF forecasts and (ii) a -3% impact from FX. We acknowledge that the lack of visibility around the demand environment for high-end discretionary goods, coupled with the level of operational gearing (manufacturing, distribution) will likely weigh on investor appetite for the luxury peers in the current market backdrop. However, we remain Buy rated on LVMH as we continue to see the group ranking well versus the broader peer group in its ability to demonstrate market-share leadership, pricing power and scale benefits to support free cash flow performance in a tough macro environment.

More analyst commentary (courtesy of Bloomberg);

UBS (neutral, PT cut to €569 from €650)

• Sales were much weaker than feared, driven by a strong Chinese deceleration, says analyst Zuzanna Pusz

• Limited visibility and the high fixed cost nature of the business mean that the end of earnings downgrades is not yet in sight

Stifel (hold, PT €650)

• Given magnitude of the first-quarter miss and negative implications for margins, analyst Rogerio Fujimori sees 2025 consensus earnings cut by a mid-single-digit percentage

• Earnings visibility remains limited

Kepler Cheuvreux (buy, PT cut to €675 from €750)

• LVMH's shortfall was broad-based, with notable weakness in fashion & leather goods and wines & spirits, analysts say

• The slowdown is mainly due to softer Chinese spending abroad, especially in Japan, and weaker U.S. demand in aspirational categories

Deutsche Bank (hold, PT cut to €565 from €580)

• It is now apparent that the fourth quarter was the anomaly for LVMH, says analyst Adam Cochrane, with slowdown in perfumes & cosmetics and Sephora greater than expected and suggesting some weakness with the more aspirational consumer

• Big investor fear that U.S. is slowing for luxury does not appear to be the case in the first quarter; slowdown in fashion & leather mainly due to weakness in Chinese cluster

Bryan Garnier (buy, PT cut to €730 from €810)

• LVMH's first quarter was worse than expected, writes analyst Loic Morvan, with sales momentum softer than anticipated

• The first quarter faced a still-demanding comparison basis; following the release, analyst sees no 2025 sales growth

Bernstein (outperform, PT €625)

• Analyst Luca Solca notes that the investor conference all focused on demand in the U.S. given tariffs, with the company's answers leaving "many disappointed" given it saw no impact on demand in the U.S. in the last weeks of March

Telsey Advisory Group (outperform, PT cut to €715 from €820)

• LVMH's first-quarter organic sales decline fell short of the consensus expectation, says analyst Dana Telsey, though Europe was the bright spot

• Despite near-term disruptions, LVMH has some of the strongest luxury brands in the world and manages them for their long-term success

RBC (outperform, PT to €680 vs €750)

• Analyst Piral Dadhania writes that investor concerns about underlying demand recovery are likely to be "amplified" based on this report

• Cuts FY25 Ebit expectations by 8%, including a "more pronounced" reduction in 1H25 * Dadhania expects these softer-than-expected results from "bellwether" LVMH will have negative read-across to the wider luxury sector

Morgan Stanley (equal-weight vs overweight, PT to €590 vs €740)

• Softer start to year than expected for key fashion and leather goods division and now model similar full-year contraction to top line as in 2024, analyst Edouard Aubin writes

• 2Q likely to see another contraction in sales, with China continuing to be a major drag and the industry facing a soft macro environment

• Cuts estimates, rating and PT

JPMorgan (neutral, PT €610 vs €650)

• Analyst Chiara Battisttini says even the market leader is finding things tough, with a noticeable sequential slowdown vs the previous quarter

• Volumes slightly slowed, and it's possible that product mix might have also weighed

• Lowers estimate by 7%-8% and says the sector's growth opportunities may have been exhausted

Citi (buy)

• "LVMH's ~4% revenue miss will likely set a negative tone for the upcoming reporting season," with sales for both group and fashion and leather division below even the "most conservative buyside expectations," analyst Thomas Chauvet writes

• Tough to see a "credible scenario" of sequential top-line improvement for 2Q/3Q (for LVMH and luxury peers) given "highly elevated" economic uncertainty in the U.S. and globally

Bloomberg Intelligence

• LVMH's weak start "fuels concern over luxury-market outlook" as uncertainty around tariffs grows, analyst Deborah Aitken writes

• "A slowdown in Chinese spending in Japan and Sephora in the US were the main culprits, both vs. big year-ago 1Q gains," she adds

In markets, LVMH shares in Paris are down 7.5%, trading at lows not seen since late 2020 as the luxury bubble unwinds. 

Rival Hermès International's market capitalization has surpassed LVMH's, making it the world's most valuable luxury brand — a milestone two decades after LVMH's Bernard Arnault once attempted a takeover of Hermès.

Meanwhile, on TikTok ... 

Another Chinese supplier letting TikTok users know what brands they produce for and saying with a wink and a nod that you can get the same product from them for $5.

This is like my 10th video like this from various factories with various products. pic.twitter.com/Bil0O4CJEH

— Chris (@motomadic) April 13, 2025

The Chinese Government has lifted the secrecy clause that the luxury brands had in place the Chinese Manufacturers
and now the manufacturers are exposing your favorite “luxury” brands and letting everyone know it all comes from them. pic.twitter.com/n18jvyBYBv

— Gerry (@GerryKeogh_) April 13, 2025

Chinese manufacturers just hit TikTok and it’s so good. Americans are losing it in the comments. pic.twitter.com/1oVyX8GsUF

— Ashley Werhun (@awerhun) April 12, 2025

.   .   . 

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

"They Need A Little Bit Of Time": Auto Stocks Pop On Trump Tariff Comments; But Deutsche Still Cautious

Auto stocks popped Monday after President Trump said he wants to “help some of the car companies” affected by the new 25% tariffs, acknowledging they “need a little bit of time” to shift production to the U.S. 

Automakers like GM surged higher on the news. Ford, GM, and Stellantis jumped 3–6%, Rivian rose 4.9%, and Tesla held flat. Japanese and EV makers like Toyota, Honda, and Lucid saw gains of 1.5–2%.

“I’m looking for something to help some of the car companies, where they’re switching to parts that were made in Canada, Mexico and other places... But they need a little bit of time,” Trump said during a meeting with El Salvador’s president, according to CNBC.

A senior industry executive called Trump’s remarks “some recognition that this is getting tough for the industry.” Despite recent tariff relief for tech firms like Apple, the auto levies remain.

Carmakers are adapting in different ways. Ford and Stellantis launched employee pricing deals, Jaguar Land Rover halted U.S. shipments, and Hyundai pledged no price hikes for two months.

GM is boosting U.S. production, reversing downtime at its Tennessee plant. “The previously announced downtime for the week of May 12th is being rescinded,” plant management told workers. A GM spokesperson confirmed the move.

Meanwhile Deutsche Bank released a note on Monday stating that as Q1 2025 earnings approach, automakers still face significant uncertainty from new tariffs. They expect strong early-year demand as consumers buy ahead of price hikes, followed by a slowdown in the second half as tariffs bite—pushing 2025 U.S. auto sales to 15.4 million, down from 16.0 million in 2024.

Ford and GM could see gross costs rise by over $10 billion, while Tesla and Rivian face smaller impacts due to their supply chains, the note said. These estimates assume a 25% tariff on imported vehicles and parts starting May 3, with exemptions for USMCA-compliant content.

Deutsche said it believes automakers will share the cost burden with dealers and consumers and use various cost-offsetting strategies. Still, Ford and GM may see a $4–7 billion EBIT hit annually.

"In such a context, we think Rivian may have the cleanest set-up given its relatively small exposure to the tariffs and prospects for a strong R2 product cycle (naturally subject to execution risk though)," analysts wrote.

"We continue to view Tesla favorably longer term as an embodied AI secular winner but acknowledge it faces many cross currents for the next quarter or two.

For Ford and GM, we believe both will deliver solid 1Q results compared to expectations but will withdraw full-year guidance as they implement tariff mitigation strategies. As such, we reluctantly downgrade GM to Hold from Buy given structural uncertainty around US industrial/tariff policy. While the stock already trades at a low multiple, we worry it may be an impaired asset for several years."

Tyler Durden Tue, 04/15/2025 - 07:45

Trade War Turbulence: China Halts Boeing Jet Deliveries For Airlines

Days after Juneyao Airlines postponed the delivery of a widebody jet from Boeing, Beijing has escalated its trade war response—quietly ordering all Chinese carriers to suspend further Boeing deliveries, according to Bloomberg, citing people familiar with the situation. The move marks a broadening of non-tariff retaliation amid a deepening tit-for-tar trade war between the U.S. and China. 

Here's more color from the report:

China has ordered its airlines not to take any further deliveries of Boeing Co., according to people familiar with the matter.

. . . 

Beijing has also asked that Chinese carriers halt any purchases of aircraft-related equipment and parts from U.S. companies, the people said, asking not to be identified discussing matters that are private.

The order came after China unveiled retaliatory tariffs of 125% on American goods this past weekend, the people said.

. . .

The Chinese government is also considering ways to provide assistance to airlines that lease Boeing jets and are facing higher costs, the people said.

. . .

Delivery paperwork and payment on some of these jets may have been completed before the reciprocal tariffs announced by China on April 11 took effect on April 12, and those planes may be allowed to enter China on a case-by-case basis, some of the people said.

Last week, Beijing hiked its effective tariff rate on US goods to 125%, countering President Trump's 145% tariff rate. 

Beijing also shifted to non-tariff retaliation, limiting Hollywood film imports, slowing rare earth export shipments, and weakening the yuan. 

The Bloomberg report sent Boeing shares down roughly 3.5% in New York trading. The stock is down 10% year-to-date (as of Monday's close) and hovering near Covid-era lows, still showing no signs of a meaningful recovery.

Let's not forget that China's non-tariff countermeasures may also include:

• Export Controls and Quotas

• Currency Devaluation

• Boycotts (State-Inspired)

• Licensing & Certification Hurdles

• Restricting Market Access

• Pressure Big Tech With Cybersecurity & Data Laws

• Limiting Cultural Imports

• Selling U.S. Treasuries

The trade war might be far from over...

Tyler Durden Tue, 04/15/2025 - 07:20

The post Trump Wants Greenland Because It’s Big: Full Stop appeared first on CEPR.

The post Trump’s Tariff Idiocy Is Costing the U.S. and World Bigly appeared first on CEPR.

Somali Criminal Allowed To Stay In UK Because Deportation Would "Stress" Him Out

Authored by Steve Watson via Modernity.news,

In yet another incredulous case, the British justice system has decided in its infinite wisdom that a Somali criminal will be allowed to stay in the UK because returning him to his home country would cause him too much “stress”.

Yes, really.

The Telegraph reports that a judge in the upper immigration tribunal ruled that the asylum seeker would suffer “stress” if deported to his homeland, which would worsen his mental health, thereby breaching article three of the European Convention on Human Rights (ECHR), which protects against persecution and inhumane treatment.

A Somali criminal seeking asylum in the UK has avoided deportation after a judge ruled that returning him to his home country would cause him too much “stress”https://t.co/WbGKmbQ8Ab

— The Telegraph (@Telegraph) April 11, 2025

The unnamed man, jailed for unspecified crimes, is a schizophrenic who hears voices, and has also been dependent on alcohol for almost twenty years, according to the report, another factor which led to him being allowed to stay in the country since arriving way back in 1999.

The Home Office has argued that the man, who has been granted anonymity, would be able to get medications he needs in his home country, but the judge still ruled against them.

The man is described as having a “high level of vulnerability” and “complex needs” with “the severity of his mental health problems closely linked to his stress levels and use of alcohol,” according to the tribunal.

Lawyers assigned to the guy argued that he has “no real prospect” of returning to Mogadishu and making a living and that any financial support he would receive would be “limited”, and that he has a “history of being financially exploited”.

The Home Office has a program to offer financial support to foreign criminals being deported through the Facilitated Return Scheme. In other words, the government even offered to pay for the guy’s rehabilitation in Somalia.

“Evidence from doctors suggested the man could “become well” if he abstained from alcohol and complied with his medication,” the report notes.

Yet, Deputy Upper Tribunal Judge Ian Jarvis said “I conclude that the weight of the evidence before the Tribunal indicates that the [man] will very quickly become noncompliant with his medication.. without the 24/7 support and monitoring which he currently receives in the United Kingdom.”

The judge upheld the appeal and ruled that the man’s mental health would “seriously deteriorate” if he were returned to Somalia.

Commenters on the report were not impressed by the judge’s decision:

The report further notes that its another in a long list of convicted foreign criminals attempting and in many cases succeeding in halting their deportations by claiming breaches of their human rights.

There are currently a record 41,987 outstanding immigration appeals, largely on human rights grounds.

As we highlighted last month, a convicted pedophile has escaped deportation from the UK to his native country of Pakistan after a judge ruled that he would face “inhuman or degrading treatment” there for being an alcoholic.

This case follows similar incidents, including one just last month where another Pakistani pedo was permitted to remain in the UK with a judge ruling that deportation would be “unduly harsh” owing to the fact that his family in Pakistan took a “dim view” of his crimes.

Conservative MP Sir Alec Shelbrooke urged that “The Government needs to stop dangerous criminals being allowed to stay in this country.”

*  *  *

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, 04/15/2025 - 06:30

The US Relies Heavily On Rare Earth Imports From China

As part of the retaliation against Donald Trump’s punitive tariffs on Chinese goods, China has imposed new export controls on seven additional rare earth elements, temporarily suspending any exports of the valuable minerals. 

The newly affected elements, namely samarium, gadolinium, terbium, dysprosium, lutetium, scandium and yttrium, are critical components of a wide range of products, ranging from electric cars and semiconductors to military equipment such as missiles and drones.

While the new rules stop short of a full export ban, the affected metals will require a special export license going forward – granting Chinese authorities an extra layer of control over who is granted export rights. 

Once the system is implemented, certain companies, for example U.S. defense contractors, could be banned from importing the crucial supplies, which are very hard to substitute or source elsewhere.

As Statista's Felix Richter shows in the chart below, the U.S. is heavily reliant on rare earth imports from China, which accounted for 70 percent of U.S. rare earth imports between 2020 and 2023, with Malaysia, Japan and Estonia the other three main suppliers of the United States. 

 

You will find more infographics at Statista

Yttrium, one of the elements covered by the new rules, is almost exclusively sourced in China, with 93 percent of Yttrium compounds brought into the U.S. between 2020 and 2023 coming from China. 

According to the U.S. Geological Survey, the U.S. is 100 percent import reliant for Yttrium, which is primarily used in catalysts, ceramics, electronics, lasers, metallurgy and phosphors.

Looking at rare earth minerals in general, the U.S. was 80 percent net import reliant in 2024, meaning that net imports (imports minus exports) accounted for 80 percent of apparent consumption in the U.S. last year. 

 

You will find more infographics at Statista

That’s down from 100 percent in 2020 and more than 95 percent between 2021 and 2023, as the U.S. ramped up domestic production of rare earth compounds and metals in 2024.

Tyler Durden Tue, 04/15/2025 - 05:45

World Bank Under Scrutiny Over Tajikistan Hydropower Project

Via  Eurasianet.org,

• The World Bank is facing a formal complaint regarding its financing of the Rogun Dam project in Tajikistan, with allegations of inadequate assessment of environmental and socio-economic risks.

• Environmental organizations and concerned citizens argue that the Rogun Dam poses a significant threat to regional stability and water resources, particularly the Amu Darya River.

• Calls have been made for an immediate halt to the dam's construction and a suspension of funding until a comprehensive and transparent investigation is conducted.

The World Bank is under fire over allegations of impropriety in financing the Rogun Dam project in Tajikistan. Specifically, bank officials are facing accusations that they failed to comply with procedures to account for potential environmental and socio-economic harms associated with the project.

A statement issued April 8 by the World Bank’s Inspection Panel, an independent investigative body, announced the registration of a formal Request for Inspection, in effect a complaint, concerning the bank’s involvement in the Rogun hydropower project (HPP). Bank officials now have three weeks to respond to the allegations raised in the complaint. At that point, the Inspection Panel will decide whether or not to conduct a formal investigation.

The complaint was initiated in February by two concerned citizens in Turkmenistan and Uzbekistan with the assistance of a Kazakhstan-based environmental organization, Rivers without Boundaries.

“The Rogun HPP project in its current, unfinished form poses a colossal threat to environmental stability and the well-being of millions of people in Central Asia,” said a statement issued by Rivers without Boundaries. 

“The applicants argue that the decision to finance the construction of the Rogun HPP was made by the World Bank's Board of Directors despite an incomplete and outdated Environmental and Social Impact Assessment (ESIA), which does not adequately reflect the transboundary risks and cumulative impacts of the project on vulnerable ecosystems and people in the Amu Darya River basin.”

The complaint characterized the Rogun project, which currently has a price tag exceeding $8 billion, as among the “most expensive and time-consuming false solutions” to address electricity shortages in Tajikistan and reduce carbon emissions. A study published by Rivers without Boundaries in late 2024 alleged that Rogun is a white elephant in the making, and is likely to be outmoded as an efficient and profitable generator of electricity before it becomes fully operational.

The World Bank approved a $350 million grant in December to be used to help complete the dam’s first phase of construction. 

If built to its present specifications, Rogun would be the world’s tallest dam, capable of producing 3,600 megawatts of power per year. Bank officials have described the project as a “transformative clean energy project that will improve domestic and regional welfare and contribute to the decarbonization of regional power grids in Central Asia.”

Initial due diligence conducted by the Inspection Panel found that the complaint was “not frivolous, absurd, or anonymous.”

The complaint alleges that World Bank officials relied on faulty and outdated data to evaluate the environmental impact of the dam’s operation. It goes on to assert the reservoir needed to generate electricity would reduce the flow of the already-stressed Amu Darya River by at least 25 percent, causing a “progressive catastrophe” adversely impacting the lives of up to 10 million people living downstream.

Perhaps the harshest allegation leveled against the World Bank’s approval process is that “the Project’s safeguard documents were not disclosed to impacted persons and communities in Tajikistan and in the riparian countries [Turkmenistan and Uzbekistan] and that meaningful consultations were not held,” according to the Inspection Panel statement.

Even before the Inspection Panel makes a determination on whether to proceed with a full investigation, environmental activists are seeking an immediate halt to Rogun’s construction. 

The Rivers without Borders statement “calls on the World Bank and other financial institutions involved in the Rogun HPP construction project in Tajikistan to suspend funding until a comprehensive, independent and transparent investigation of all issues raised in the request is conducted, and adequate measures are developed to prevent and mitigate the negative consequences of the project.”

Tyler Durden Tue, 04/15/2025 - 05:00

These Are The Countries With The Most Nuclear Weapons

As of 2024, nine countries possess all of the world’s 12,000 nuclear warheads.

This graphic, via Visual Capitalist's Bruno Venditti, visualizes the world’s nuclear powers based on data from the Federation of American Scientists. The exact number of nuclear weapons each country possesses is a closely guarded national secret, so the estimates presented here come with significant uncertainty.

If you run from Nvidia, here is what you are missing …

Nuclear Powers

Despite reductions since the Cold War, the global nuclear arsenal remains significant. The U.S. and Russia together hold around 88% of the world’s nuclear weapons and 84% of the warheads ready for military use. Combined, both countries have over 10,000 warheads. A 2018 study suggests that 100 nuclear weapons would be the “pragmatic limit” for any country’s arsenal.

While the U.S. has been reducing its nuclear arsenal, Russia, China, India, Pakistan, and North Korea are increasing their warhead stockpiles.

Of the warheads in military stockpiles, approximately 3,904 are deployed with operational forces (on missiles or bomber bases). Among those, about 2,100 U.S., Russian, British, and French warheads are on high alert, ready for use on short notice.

Trump’s Warning to NATO

President Trump has threatened to breach the NATO treaty and send U.S. military support only to allies who contribute what he deems a fair share of their national GDPs to defense spending.

Even without the U.S., France and the UK provide NATO with the third-largest nuclear arsenal, maintaining the alliance’s strategic deterrent capabilities.

Global Nuclear Arsenal Decline

Despite the world’s continued ability to cause mass destruction, nuclear weapon stockpiles have significantly declined over the last few decades. Since the Cold War, global arsenals have decreased from a peak of approximately 70,300 warheads in 1986 to an estimated 12,331 at the beginning of 2025.

If you enjoyed this topic, check out this graphic that illustrates the total number of nuclear warhead stockpiles from 1945 to 2024.

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