Nice Archives - The Automatic Earth

This may be the most articulate response I’ve ever heard to this question. pic.twitter.com/ndPULk09pT
— Today in History (@TodayinHistory) May 6, 2026

Will never get tired of sharing this.

Never forget that @SecRubio called the Iran situation 11 years ago.

He analysed it and predicted it.

Like a play-by-play, to a tee.
The accuracy is absolutely mind-blowing.

It’s worth sharing again, because there are still some people… pic.twitter.com/IdtTcmdhRE
— Kosher (@koshercockney) May 6, 2026

https://twitter.com/CRRJA5/status/2051854394044375415?s=20

Elon Musk just made every skill you’ve ever earned sound like a waste of time.

Musk: “Down the road with a Neuralink, you can just upload any subject instantly. You wanna fly a helicopter? No problem. Any given skill, you just upload it instantly.”

Not faster learning.

Not… pic.twitter.com/nncWIX4Naw
— Dustin (@r0ck3t23) May 5, 2026

Accurate https://t.co/Z3xsCeDHXk
— Elon Musk (@elonmusk) May 6, 2026

“The sea blockade is a much more serious threat than even war.. ”

• ‘Fate Of Iran Refineries Now At Risk’ As US Blockade Begins To Bite (ZH)

An Iranian energy official just conceded something in a surprise admission that the US naval blockade has begun to bite the Islamic Republic’s oil industry. According to new reporting in the NY Times: The blockade has halted Iran’s oil exports, choking off crucial revenues, and the country risks running out of places to store its oil. It is also affecting the import of other goods, forcing Iran to seek alternative routes through neighboring countries and its smaller ports on the Caspian Sea. And the economic pain inside Iran, already dire before the war, is becoming much worse.

“The sea blockade is a much more serious threat than even war, and the current stalemate must be broken because the export of our oil and energy and the fate of our refineries is now at risk,” said Hamid Hosseini, an expert on Iran’s oil sector who serves on the energy committee of Iran’s Chamber of Commerce, in an interview from Tehran.This as Kpler has stated based on its data that since the US blockade took effect on April 13, no Iranian oil-laden tankers have been able to exit the strait.
“The bottom line is that Iran could run out of storage space in about 25 to 30 days if the blockade is not lifted, according to Homayoun Falakshahi, Kpler’s head of oil analysis,” continues the Wednesday report. “Other experts have given different estimates ranging from a few weeks to a month or more.” Last month we offered the following, saying a likely 15 days – probably followed with a few weeks left on the clock before the Iranians run out of storage space… As for the current Trump blockade strategy, another analyst told the Times, “The blockade really is about putting a financial deadline on the Islamic Republic’s head.”
US Jet Fires On Iranian Tanker Trying To Pass
So much for that ceasefire and alleged ‘pause’ in US naval blockade actions, as things just took another escalatory turn. In this case, a rare live fire incident unfolded Wednesday in Gulf waters as a US jet launched from the Lincoln carrier fired on and possibly disabled an Iranian-flagged tanker, per the officials US Central Command statement: U.S. forces operating in the Gulf of Oman enforced blockade measures by disabling an Iranian-flagged unladen oil tanker attempting to sail toward an Iranian port at 9 a.m. ET, May 6. U.S. Central Command (CENTCOM) forces observed M/T Hasna as it transited international waters enroute to an Iranian port on the Gulf of Oman. American forces issued multiple warnings and informed the Iranian-flagged vessel it was in violation of the U.S. blockade.
After Hasna’s crew failed to comply with repeated warnings, U.S. forces disabled the tanker’s rudder by firing several rounds from the 20mm cannon gun of a U.S. Navy F/A-18 Super Hornet launched from USS Abraham Lincoln (CVN 72). Hasna is no longer transiting to Iran. The Pentagon/CENTCOM statement then emphasized, “The U.S. blockade against ships attempting to enter or depart Iranian ports remains in full effect. CENTCOM forces continue to act deliberately and professionally to ensure compliance.” Tehran’s response to this will be interesting, and follows prior alleged attacks this week on the UAE.

Don’t fall for those talks. After a month you’ll be right back where you started.

• ‘Framework’ Still Being Hammered Out For ‘Monthlong’ US, Iran Talks (ZH)

Iran’s Foreign Ministry has said that Iran’s response to the United States has not yet been presented to mediator Pakistan, as the WSJ reports that the US and Iranian sides are currently trying to hammer out a one-page memorandum of understanding which features 14-points. This would “lay out a framework” – the report says, for a “monthlong period of talks to end the war.” Given that agreement cannot even be found on the ‘framework’ for future talks, it seems the process is not very advanced at all – but is perhaps still back at square one, with headlines in the US way out front, and likely overly optimistic.

CNN citing the White House: “The White House received positive feedback from Pakistani mediators on Tuesday that the Iranians were progressing toward a compromise.” And more from WSJ: Iran’s mission to the UN said that “the only viable solution in the Strait of Hormuz is clear: a permanent end to the war, the lifting of the maritime blockade, and the restoration of normal passage.”
Key Timing of Wang-Araghchi Meeting in Beijing
During Iranian Foreign Minister Araghchi’s visit to Beijing on Wednesday, China’s Foreign Minister Wang Yi pushed for the rapid reopening of the Strait of Hormuz and a halt to the fighting. Araghchi echoed the urgency, saying, “Currently, it is possible to resolve the issue of reopening the Strait of Hormuz as soon as possible.” Wang called for a “comprehensive ceasefire” and stressed that “the international community shares a common concern for restoring normal and safe passage through the Strait,” urging swift action.
The coordinated messaging reflects shared economic and strategic interests, especially as US naval actions have disrupted Iranian oil flows to China. Wang also signaled support for Tehran’s position, stating China “appreciates Iran’s pledge to not develop nuclear weapons,” while Iran continues to insist its nuclear program is peaceful and maintains its right to uranium enrichment as a matter of sovereignty. Wang reinforced Beijing’s stance by warning that “a comprehensive ceasefire brooks no delay” and that negotiations must continue, while US Secretary of State Marco Rubio has called on China to pressure Iran to ease its blockade of the strait.
Alarmed Reaction from Israel
An Israeli official cited in Times of Israel said Israel did not know that President Trump was close to a deal with Iran to end the fighting and reopen the Strait of Hormuz, even as global headlines pointed to progress. The official said Israel had been preparing for escalation, reflecting recent reports that Prime Minister Benjamin Netanyahu’s government was waiting for US approval to resume its aerial campaign following 38 days of strikes under Operation Epic Fury.
US messaging has shifted rapidly. with Secretary of State Marco Rubio on Tuesday having announced the end of Operation Epic Fury and a pivot to Project Freedom focused on reopening Hormuz, while Trump later declared a pause to allow negotiations. The mixed signals from Washington created confusion as diplomacy and military positioning unfolded simultaneously. Both Iran and Israel signaled readiness to escalate despite the diplomatic push. Iran warned its “finger is on the trigger,” while Israeli military chief Lt. Gen. Eyal Zamir said forces have multiple targets prepared inside Iran and remain on high alert. He emphasized ongoing coordination with US forces and readiness to resume a broad campaign if fighting restarts.
More Official Iran Denials: Too Much ‘Speculation’
The latest response out of Tehran via Tasnim: “Despite claims by US media that Iran and the US are close to a final one-page agreement to end the war, Iran has not yet given an official response to the Americans’ final text, which contains some unacceptable clauses.” And separately Iran’s ISNA calls parts of the Axios report “speculation” – also reiterating the country has rejected some recent US proposals, as they are “unrealistic”. However, an Iranian spokesperson has said that Iran is indeed “reviewing the US proposal to end the war.”
Trump Admits: ‘Too Soon’
And now a bit of rapid narrative reversal, coming from President Trump himself, after once again a likely premature early morning Axios report with overly optimistic language. Trump’s fresh words are via the NY Post: President Donald Trump said it’s “too soon” to plan peace talks with Iran despite reports of a near deal, downplaying prospects of imminent negotiations in Pakistan. He warned that if Iran accepts terms, hostilities could end and the Strait of Hormuz reopen—but failure to agree would trigger intensified military action.
Indeed the Iranian reaction issued via media reports also suggests this is the case, that all the talk of an agreement being close is premature, and there remains immense hurdles and a long way to go. Axios’ Barak Ravid still insists that “the sources said this was the closest the parties had been to an agreement since the war began.”

“..if Tehran doesn’t agree then “the bombing starts” and it will be at a “much higher level and intensity than it was before”.

• Iran Spox Blasts ‘Unrealistic’ White House ‘Wish List’ To End War (ZH)

And now a bit of rapid narrative reversal, coming from President Trump himself, after once again a likely premature early morning Axios report with overly optimistic language. Trump’s fresh words are via the NY Post: President Donald Trump said it’s “too soon” to plan peace talks with Iran despite reports of a near deal, downplaying prospects of imminent negotiations in Pakistan. He warned that if Iran accepts terms, hostilities could end and the Strait of Hormuz reopen—but failure to agree would trigger intensified military action.

Indeed the Iranian reaction issued via media reports also suggests this is the case, that all the talk of an agreement being close is premature, and there remains immense hurdles and a long way to go. Axios’ Barak Ravid still insists that “the sources said this was the closest the parties had been to an agreement since the war began.”
Initial Word From Tehran: Doesn’t Reflect Reality
Iranian initial reaction through its media: “What US media outlets are publishing about the details of the negotiations does not reflect the reality of what is happening, according to AI Araby citing Iranian Sources.” “Progress has been made in talks with Washington through Pakistan, but it has not yet reached a level that would lead to an agreement,” the statement says. The Iranians are also clearly sticking by their approach which says the nuclear issue is a non-starter and that talks must focus on opening Hormuz and finding a final end to the conflict. “The negotiations are focused on ending the war, not the nuclear issue,” the statement in Al Araby continues.
And then the final criticism of Washington’s approach: “The negotiations are still facing the intransigent American approach and excessive demands.” And further, this: Ebrahim Rezaei dismissed U.S. demands as unrealistic, saying Washington won’t gain through conflict what it failed to secure in talks. He added Iran is ready to act and warned of a severe, regret-inducing response to any provocation. Here is the full statement from the Iranian Spokesperson of the National Security and Foreign Policy Commission (via machine translation):

Trump Issues Carrot & Stick
The below is a fresh Trump Truth Social Post on Wednesday morning, warning the Iranians that the Hormuz Strait must be “open to all”. However, the president continues, if Tehran doesn’t agree then “the bombing starts” and it will be at a “much higher level and intensity than it was before”.

All of this has followed an awkward 24 hours of drastically different signals coming from various top officials of the US administration.

Marco Rubio says the goal of the war in Iran is now to restore it "back to the way it was" before Trump started the war in Iran pic.twitter.com/G1E9qyxMc4
— Headquarters (@HQNewsNow) May 5, 2026

Iran was long screwed over by Russia while it itself screwed over US and Israel?

• Inside The Moscow Meeting That Laid Bare Iran’s Weak Hand (Watkins)

Iran has a long history of being screwed over by Russia, and last week’s meeting in Moscow between Iranian Foreign Minister Abbas Araghchi and Russian President Vladimir Putin over the U.S.–Israel–Iran war suggests nothing in that dynamic is about to change, according to extremely well-placed sources on both sides who spoke exclusively to OilPrice.com over the weekend. On the one hand, Tehran’s perennially baseless optimism that “this time will be different” was on full display in Araghchi’s excited praise for the marvels of the two countries’ so called ‘strategic relationship’.

On the other hand, Moscow responded with all the warmth of an international telephone operator: Kremlin spokesman Dmitry Peskov said only that Russia stands ready to offer “goodwill or mediation services”, with no indication of any upgrade to the relationship service package. It fits so neatly into the familiar pattern of this abusive relationship that one wonders whether social services should be called. Or perhaps Moscow’s disinterest is merely an act — a way of masking the deep and broad assistance from Tehran that it so clearly craves?
The theoretical basis of this relationship is the 20-year comprehensive cooperation deal between Iran and Russia — formally titled The Treaty on the Basis of Mutual Relations and Principles of Cooperation between Iran and Russia — approved by Iran’s late Supreme Leader, Ali Khamenei, on 18 January 2024, as I exclusively reported in OilPrice.com at the time. It replaced the 10-year deal signed in March 2001 (extended twice by five years) and was expanded in duration, scope and scale, particularly in the defence and energy sectors.
In several respects, the new deal complemented key elements of the all-encompassing Iran-China 25-Year Comprehensive Cooperation Agreement, first revealed anywhere in the world in my 3 September 2019 article and analysed in full in my latest book on the new global oil market order. The similarities were deliberate, designed to make the division of the key strategic assets most coveted by Moscow and Beijing easier to manage in practice. Related: China Orders Refiners to Ignore U.S. Sanctions on Key Iranian Oil Buyers
As with much of Russia’s foreign policy dealings, the devil was in the details. As a sign of how things would pan out for Tehran in the rest of the document, Russia stood to benefit at Iran’s expense in the key energy sector to begin with. The deal gave Russia the first right of extraction in the Iranian section of the Caspian Sea, including the potentially huge Chalous field. This came on top of Russia’s startlingly brazen theft in 2019 of at least US$3.2 trillion in revenues from Iran through the lost value of energy products across their shared Caspian assets going forward.
The same right of first extraction for Russia was also applied in the new 20-year deal to several of Iran’s major oil and gas fields in the Khorramshahr and nearby Ilam provinces that border Iraq, which China had not already prioritised for its own needs. Several of these sites had the broader financial and geopolitical benefits attached to their being shared fields with Iraq. This status allowed the effective free movement of Iranian oil disguised as Iraqi oil, and extended Tehran’s influence over Baghdad through its political, economic, and military proxies. By extension, it did the same for Moscow and Beijing, which used this as a springboard to further project their influence across the Iran-dominated Shia Crescent of Power.
This powerbase in Iran and Iraq had also been central to Russia’s longstanding plan to build a ‘land bridge’ to the Mediterranean Sea coast of another of its key global assets at the time — Syria. This would enable Moscow to exponentially increase weapons delivery into southern Lebanon and the Golan Heights area of Syria to be used in attacks on Israel. The core aim of this policy was to provoke a conflict in the Middle East that would draw in the U.S. and its allies into an unwinnable war, and was seen as a natural extension of the Israel-Hamas War that had begun after the terrorist organisation’s murderous spree across Israel on 7 October 2023.
Given its centrality to Moscow’s plans, then, Iran was at that point still confident that the Kremlin would meet its other promises in the 20-year deal, despite the shenanigans surrounding the energy side of the treaty as it related to the Caspian’s oil and gas riches. “Iran had long been asking Russia for the means to defend itself better against any attacks, especially those that might come from Israel or the U.S. — in particular for the S-400 missile defence system and Sukhoi Su-34 and 35 fighter jets,” a very senior source working closely with Iran’s Petroleum Ministry exclusively told OilPrice.com. “But these requests have continually been subject to further conditionality by Russia, such as upgrading key airports and seaports that Moscow sees as especially useful for dual-use by its air force and navy, and which are also close to major oil and gas facilities.

“Will ICE officially become NICE? Probably not anytime soon. But the mere suggestion has Democrats tying themselves in knots ..”

• Trump Dropped an ICE Rebrand — and Democrats Are Losing It (Margolis)

Leave it to the left to have a meltdown over a single letter. Last month, President Donald Trump endorsed rebranding Immigration and Customs Enforcement as National Immigration and Customs Enforcement — NICE — and on Tuesday, the White House unveiled updated branding for the agency, complete with a new patch mockup. DHS amplified the rollout on its own X account, and the trolling was, well, quite effective. The idea didn’t originate in the Oval Office. Comedian Adam Carolla first floated it back in September.

.⁦@adamcarolla⁩ unveils his nice idea to stop Gavin Newsom and other leftists from verbally attacking ICE. pic.twitter.com/bGf1uNMuJz
— Paul Bond (@WriterPaulBond) September 26, 2025

Then in March, conservative influencer Alyssa Marie wrote on X, “I want Trump to change ICE to NICE (National Immigration and Customs Enforcement) so the media has to say NICE agents all day everyday.”Trump promptly endorsed it on Truth Social, calling it a “great idea.” Then on Tuesday came the onslaught. Trump posted what many believe to be a potential rebrand on Truth Social, which the Department of Homeland Security reposted on X.
https://twitter.com/DHSgov/status/2051754837683896415
The White House also posted a patch concept.
https://twitter.com/WhiteHouse/status/2051761247779979301
Looks good, doesn’t it? Naturally, Democrats started flipping out. Because, of course, they did. And obviously, they responded in their usual “classy” way. I don’t have to tell you this isn’t what happened. Renee Good attempted to run over an ICE agent with her car, and he fired in self-defense. But facts have never been the left’s strong suit when there’s a narrative to protect. But I digress.
This all sounds great, and the reactions from the left are so worth it. But officially changing the agency’s name from ICE to NICE would require an act of Congress to amend the statute that created the agency. Still, the NICE rebrand is a perfect piece of political judo. It reframes the public conversation around an agency the left has spent years trying to demonize. Democrats want the word “ICE” to conjure fear and cruelty. Trump wants the media to be forced to say “NICE agents” every single day, in every single broadcast. It’s hard to run a “Defund NICE” campaign with a straight face. The left knows it, which is exactly why they’re reacting with such theatrical fury.
Will ICE officially become NICE? Probably not anytime soon. But the mere suggestion has Democrats tying themselves in knots, and that alone is worth it. Sometimes the point of a move isn’t to execute it — it’s to watch your opponents trip over themselves reacting to it. On that score, this one is already a win. So, yeah, I’m all for it. Frankly, I’m surprised it wasn’t called NICE to begin with. Clearly, Carolla was onto something, and I really hope we see it happen… if for no other reason than to see Democrats lose it.

“The most effective way to get the best outcome is to approach and enlist the smart ones from outside government to come and assist. Patel was always an insider.”

• Kash Patel Outlines Secret Room in FBI Headquarters (CTH)

My opinion on our current FBI Director is the same as it was the day his nomination was announced. The best, the most competent, the smartest, the most insightful and stable thinking people do not originate on a track from inside government work. The most effective way to get the best outcome is to approach and enlist the smart ones from outside government to come and assist. Patel was always an insider.

The FBI is an institution built upon corruption and fraud. Unfortunately, neither President Trump, nor the American people, will ever get the vindication and accountability he/we deserve until Kash Patel is no longer the one in charge of delivering it. It’s just that painfully simple. Trying to reform a corrupt system while maintaining the structures that enabled the corruption leads to endless discussions and ‘trust me bro’ delays.
In this interview FBI Director Kash Patel sits down with Sean Hannity to discuss current and prior events within the FBI. Patel’s primary objective is the performance; the presentation of what he thinks will endear him to President Trump the most. This is not effectiveness; the outcome is the illusion of leadership.

“..going against Trump in a primary means ending up “in the grinder..”

• Trump Is Purging RINOs, and the Left Is Panicking (Margolis)

Tuesday night’s Indiana Republican State Senate primary turned into a political slaughterhouse. Five of seven GOP incumbents who’d stonewalled efforts to redistrict the state in Republicans’ favor went down in flames. There was nothing subtle about the message from MAGA voters. They want strong Republicans who will fight the Democrats, not be weak, useful idiots for the left. And if there’s anything that Donald Trump has taught the GOP, it’s how to be a fighter. “He’s the boss of the party,” Scott Jennings said of Trump on CNN’s Anderson Cooper 360 Degrees. “He calls the shots in the Republican Party, and if you go against that, he will pour his wrath out upon you, and it doesn’t typically turn out well.”

That’s not spin. That’s just reality at this point. Jennings invoked Harry Enten’s well-worn observation that going against Trump in a primary means ending up “in the grinder,” and Indiana delivered a fresh case study. And weak-kneed Republicans should take note, because the carnage won’t stop in Indiana. Jennings immediately pointed to what comes next: Kentucky’s 4th Congressional District in a couple of weeks, where Thomas Massie — arguably the single biggest thorn in Trump’s side in the entire House — is staring down a well-funded primary challenge.
“If you look at what happened in Indiana tonight, and you’re Thomas Massie tonight, or you’re anybody else in a primary right now where Trump’s on the other side of you, you’ve got to be thinking, this is a bad night for me,” Jennings said. The money’s there. The will is there. The precedent is being set, one primary at a time. Then Van Jones opened his mouth. Jones went full pearl-clutching, calling Trump a “petty little punching-down bully” and complaining that the president couldn’t find the Epstein files or lower gas prices but somehow found time to meddle in statesenate races.
“I would be embarrassed if I were the President of the United States with the level of crisis that we have, that this is his most important objective and the only thing he’s gotten right, apparently, in the past six months,” Jones said. He topped it off with a little lecture about sovereignty and kings: “We don’t have a king.” Really? He’s playing the King Card? Of course, Jennings calmly torched Jones’s whole argument with one question: “Do you think that those sorts of rules apply to, say, Barack Obama when he engages in the Virginia redistricting referendum?”Jones tried to wiggle out of it. “He didn’t — he got involved in a ballot measure,” Jones said. “He didn’t go poking and picking on individual dog catchers and everybody else.”
And Barack Obama never endorsed Democrats in competitive primaries before? Give me a break. What a dumb argument to make. So, obviously, Jennings wasn’t buying it. “Well, he was picking on the Republican congressman who represented their constituents.” And that was that. Jones tried to lecture about the sanctity of political prerogatives, even apparently forgetting that presidents from both parties have long used their influence to shape their parties, be it by endorsing or recruiting candidates, raising money, cutting ads, etc. What Jones is really upset about here is that Trump has succeeded.

It’s too easy to be corrupt in the US. Because the people paid to prevent this were all focused on getting Trump.

• FBI Raids Virginia Senate President’s Office (Salgado)

A top Virginia Democrat and ally of radical Gov. Abigail Spanberger is suddenly in the spotlight as the FBI raids her office amid a reported corruption investigation. Fox News correspondent Bill Melugin posted on X May 6 that Fox was “on scene in Portsmouth, VA where the FBI is raiding the office of Virginia Senate President Pro Tempore L[.] Louise Lucas, a Democrat and close ally of VA Governor Spanberger. Fed law enforcement sources tell FOX this is in connection to a major corruption probe, and the FBI is serving multiple search warrants, approved by a federal judge, at her office and a next door cannabis dispensary. More to come with correspondent @AlexHoganTV, who reports that Lucas just showed up on scene as the FBI searches her office.”

Fox’s foreign correspondent Alex Hogan posted the video below:

The FBI is currently carrying out a raid at the office of Senator Louise Lucas in Portsmouth, VA. Here at this nearby cannabis dispensary, at least three people were taken into custody. Federal law enforcement say they’re conducting “court authorized criminal search warrants”. pic.twitter.com/UL2c7yAk0L
— Alex Hogan (@AlexHoganTV) May 6, 2026

Ironically, like so many other Democrats, Lucas previously lectured that “no one is above the law” when gloating over the March 2023 Manhattan grand jury indictment of Donald Trump. Now Trump is back in the White House, and his FBI is raiding Lucas’s office.

Louise Lucas just learned no one is above the law! https://t.co/9n6H4zlV5f pic.twitter.com/TZZkxtH6pY
— Libs of TikTok (@libsoftiktok) May 6, 2026

It is not clear if this investigation will involve Spanberger directly at all, or only indirectly, because her ally Lucas is the one under federal investigation.
Notably, however, Spanberger also arguably violates federal law on a regular basis whenever she enforces sanctuary policies for illegal aliens. For instance, the Department of Homeland Security just rearrested Guatemalan illegal alien and pedophile Walvin Victor Hugo Garcia after Spanberger and her fellow Democrats defied an ICE detainer request and released Garcia. And earlier this year, after Sierra Leone criminal illegal alien Abdul Jalloh, with 30 prior arrests, stabbed a 41-year-old Virginia mom, Stephanie Minter, to death at a bus stop, Spanberger explicitly refused to hand Jalloh over to federal immigration authorities.
The reason I say this behavior potentially violates the law is that, according to 18 U.S. Code § 111, anyone who “forcibly assaults, resists, opposes, impedes, intimidates, or interferes with” designated federal officers has committed a criminal offense. 8 U.S. Code § 1324 also states that anyone who “encourages or induces an alien to come to, enter, or reside in the United States, knowing or in reckless disregard of the fact that such coming to, entry, or residence is or will be in violation of law” or “conceals, harbors, or shields from detection, or attempts to conceal, harbor, or shield from detection, such alien” violates the law. Spanberger appears to have broken both those laws, as have all officials in Virginia enforcing sanctuary policies. Maybe the Feds need to raid Spanberger next.

“In one from 2017, Brockman muses, “It’d be wrong to steal the nonprofit from [Musk] and turn it into a B-Corp without him—doing so would be pretty morally bankrupt.”

• OpenAI Co-founder Greg Brockman Defends Company’s For-Profit Pivot (ET)

In the second week of a high-profile jury trial that could have profound impact on the race for artificial intelligence, OpenAI president Greg Brockman rejected allegations that he and other co-founders betrayed the company’s philanthropic mission and illegally enriched themselves by flipping the non-profit lab into a for-profit corporation.Tesla CEO Elon Musk in 2024 sued Brockman and CEO Sam Altman, alleging they bilked him of $38 million in donations then restructured as a for-profit corporation by exclusively licensing their flagship product to Microsoft—betraying a founding mission to operate as an open-source charity that would counter the risks of profit-driven AI.

OpenAI and Microsoft deny the allegations, arguing that Musk abandoned the company in 2018 to start his own for-profit competitor, xAI, when other founders rejected his bid to take full control of the operation. “I think we’ve been very consistent on the mission,” Brockman told a federal court in Oakland. “If you look at what we’ve accomplished—currently the foundation has $150 billion worth of OpenAI equity value. That’s something we’ve built through hard blood, sweat, and tears through all this time since Elon left.” The company’s nonprofit foundation has a 27 percent stake in OpenAI’s for-profit corporation; Microsoft, which has invested more than $13 billion since 2019, owns 26 percent.
Called as an adverse witness for the plaintiff, Brockman over two days May 4–5 offered testimony outlining an alternate narrative and timeframe than the one Musk presented the week prior. Brockman also attempted to add context to what he has claimed were “cherrypicked” segments of his personal diary, unsealed during the discovery process. He often spoke in incomplete sentences, punctuated by stock phrases like, “We were solving for the mission.” Arguably, this had less zing to it than, “You can’t just steal a charity”—a phrase Musk favored in his own testimony.
‘Morally Bankrupt’ Musk’s attorney Steven Molo grilled Brockman on a series of diary entries from 2017 and 2018, a time of intense negotiations with Musk over the future structure of the company. In one from 2017, Brockman muses, “It’d be wrong to steal the nonprofit from [Musk] and turn it into a B-Corp without him—doing so would be pretty morally bankrupt.” Brockman denied this contradicted his commitment to OpenAI’s mission. “I think I meant it would actually serve the mission, but it would be hard to look at yourself in the mirror,” he told the court. Under cross-examination, he explained he was referring to the idea of voting Musk off the board of directors, which he had considered at the time.
“It had been made clear to us,” he said, “that if we didn’t come to [Musk’s] terms, he was going to start an AGI competitor.” Artificial General Intelligence (AGI) is the hypothetical point at which digital intelligence reaches or surpasses human cognitive abilities and can operate autonomously. Some, including Musk, believe we have already achieved an early version of it, and that AGI advancement in the wrong hands poses the greatest existential threat to humanity. Musk testified that this threat was the express motivation for creating OpenAI as an open-source, nonprofit lab. From late 2017 to early 2018, Musk, Altman, Brockman, and Ilya Sutskever, another OpenAI co-founder and its former chief scientist, floated various ideas as they debated how to fund the project at a competitive level.
Musk, the main donor, rejected an even equity split among the four co-founders, instead proposing a deal that would give him majority stake, to be diluted as more investors joined. Brockman said he and Sutskever were willing to accept Musk being CEO and having a majority stake. “But the one thing we could not accept was to hand him unilateral total control over the AGI.” Musk was the wrong man for the job, according to Brockman. “Look, he knows rockets, he knows electric cars, he did not and I believe does not know AI,” Brockman said of the Tesla and SpaceX CEO. “And Ilya and I did not think he was going to spend the time required to actually get good at it.”
Brockman alleged Musk “didn’t recognize that spark” in early language models underlying the GPT technology. “It was there, a working version, we could see the promise. … We really needed someone running the company that had that effect.” Molo pressed the witness, pointing to emails from Musk proposing a 16-person board for the new corporation, in which Musk would have a 25 percent influence. “This is the man you’re saying wanted to be the AI tyrant and have absolute and total control?” Molo probed. “He wanted a board, and conducted in a way you were not familiar with because you didn’t have the experience of corporate governance, did you?” Brockman acknowledged, “Definitely, this is something I was new to,” but maintained that there was never a real plan for Musk to relinquish control.
In a January 2018 email to Musk and others, Brockman stressed that a moral high ground was “our best tool,” and to maintain it, the company should endeavor to remain a nonprofit. “AI is going to shake up the fabric of society, and our fiduciary duty should be to humanity.” But back in November 2017, Molo pointed out that Brockman’s diary entries show he was worried about how it would look if the founders continued to say they were committed to a nonprofit while planning to convert to a for-profit. “Cannot say that we are committed to the nonprofit. Don’t wanna say that we’re committed. If three months later we’re doing b-corp then it was a lie,” Brockman wrote. “Can’t see us turning this into a for-profit without a very nasty fight.”

What is more newsworthy? That he offered sperm or that he fathered 4 children with her?

• Former OpenAI Board Member Says Elon Musk Offered Her Sperm Donations (BBC)

A former OpenAI board member has explained how her unconventional personal relationship with Elon Musk evolved into having four of his children. Shivon Zilis testified in a federal courtroom in Oakland, California for hours on Wednesday as part of Musk’s lawsuit trying to reverse OpenAI’s change to a for-profit company. The focus of Zilis’s appearance was her direct involvement in early talks with Musk around the company becoming a for-profit, but also how she worked for and became involved with Musk as she advised OpenAI. “I still really wanted to be a mum and Elon made the offer around that time and I accepted,” she said, explaining Musk in 2020 had offered to donate sperm.

Zilis and Musk attended the wedding of White House Deputy Chief of Staff Dan Scavino at Mar-a-Lago in February

“He was encouraging everyone around him at that time to have kids and he’d noticed I did not. He offered to make a donation,” Zilis said. Zilis has worked as a venture capitalist in Silicon Valley for over 15 years and held executive positions at Musk’s car company, Tesla, and his neurotechnology firm Neuralink. She joined OpenAI as an advisor in 2016, not long after it was founded, a position through which she said on Wednesday is how she first met Musk. Given Zilis’s role across Musk’s companies and OpenAI, eventually becoming a director at OpenAI from 2020 to 2023, she is an important witness in the trial. OpenAI lawyers have suggested that she funnelled information about OpenAI to Musk after he in 2018 left the AI company, which he co-founded and made early donations to.
Zilis said she had a “one-off” romance with Musk about a decade ago but was not romantically involved with Musk in 2020, when Musk initially made the offer to father her children. She explained she had been struggling with certain health issues which had changed her initial plans to follow a more traditional personal path of getting married and having children with a romantic partner. Zilis’s initial plan for Musk’s role in the lives of the first two children she had by him was not necessarily as an active father, and the two had agreed to keep his paternity “strictly confidential.” Today, Musk is an active participant in the lives of his now four children with Zilis, she said, explaining that they spend a few hours a week together as a family.
Zilis said the confidentiality agreement with Musk is why she did not disclose to OpenAI’s chief executive Sam Altman that twins she gave birth to in 2021 were fathered by Musk. She told Altman that Musk was the father the following year, when she learned a Business Insider report on Musk’s paternity of the children was imminent. Nevertheless, Altman and OpenAI’s president Greg Brockman wanted to continue with Zilis on the board of the AI company. Zilis said on Wednesday that the three remained friends until at least 2023. When asked earlier this week about Zilis’ involvement with OpenAI for years after Musk had left the company, Brockman said: “We trusted her to keep the Elon conflict under control.”
Zilis left the board in March 2023 as Musk was launching xAI, an AI company developing a chatbot that is a direct competitor to OpenAI’s ChatGPT.With years of history, including emails and text messages that have been made part of the case between Zilis, Altman, Brockman, and Musk, lawyers for OpenAI seized on several examples of discussions around changing the corporate structure of the AI company. Moving away from being a pure non-profit was seen as necessary as early as 2017 in order for OpenAI to grow and raise from investors many billions of dollars, according to written exchanges shown in court in which Musk was involved.
Brockman and another OpenAI co-founder Ilya Sutskever were pushing for the company to transition to a B Corp, which is a type of for-profit entity that holds itself to a certain mission.nEmails from Zilis showed that Musk wanted more control of OpenAI, through additional board seats and even suggested that the AI company become part of Tesla, possibly as a B Corp subsidiary of the electric car company. Zilis said in a written exchange that such a move for OpenAI “solves the funding issue immediately.” Ultimately, Altman, Brockman, Sutskever could not agree on terms with Musk, in large part because they were adamant that Musk “not have control” of OpenAI’s work, according to an email from Zilis shown in court.

“Since her appointment by President Joe Biden, Supreme Court Justice Ketanji Brown Jackson has quickly developed a radical and chilling jurisprudence..”

• Three Justices Chastise Jackson for Groundless, Irresponsible Dissent (Turley)

Since her appointment by President Joe Biden, Supreme Court Justice Ketanji Brown Jackson has quickly developed a radical and chilling jurisprudence. Her often sole dissents and accusatory rhetoric have drawn not just the ire of her conservative colleagues but her liberal colleagues. This week, that tension deepened with a stinging rebuke from Justice Samuel Alito (joined by Justices Clarence Thomas and Neil Gorsuch).

At issue is the finalization of the Court’s opinion in Louisiana v. Callais, where the Court ruled 6-3 to ban racial gerrymandering. The Court reaffirmed the use of Section 2 of the Voting Rights Act to ban intentional racial discrimination in the design of voting districts, but effectively found many districts to be unconstitutional in their current form. There is no reason why the decision should not be finalized except for a blatantly partisan effort to protect the Democrats from losing seats in the midterm elections. After all, if these districts are unconstitutional, why should states guarantee that voters are given representatives chosen free of racial discriminatory preferences?
That question is even more confusing given the long wait for this opinion. Not only was the case reargued, but there were growing complaints about the delay in releasing the opinion. Complaints increased after a recent book allegedly reported that Justice Elena Kagan had a vocal confrontation with her colleague, former Justice Stephen Breyer, over his push to release the dissents in Dobbs after the leaking of that opinion. Breyer reportedly agreed with Chief Justice John Roberts that the conservative justices were facing increased death threats due to the delay. Kagan allegedly wanted to further delay the release.
In the Callais decision, the delay was curious since there were six solid votes for the majority and not more of a fracturing of opinions. Indeed, the majority opinion’s references to the Kagan dissent are relatively brief. Nevertheless, the delay has made it very difficult for states to make changes. A few are moving to delay their primaries or draw new maps under extremely tight calendars. Regardless of the delay, there is no cognizable or principled reason to withhold the opinion to preserve unconstitutional districts. The case has already been on the docket for an unusually long time due to a reargument.
In its one-paragraph order, the court acknowledged that the Supreme Court’s clerk normally waits 32 days after a decision to send a copy of the opinion and the judgment to the lower court. However, it noted that the defenders of the challenged districts had “not expressed any intent to ask this Court to reconsider its judgment.” Conversely, the other parties raised the need for states to address the impact of the ruling with the approaching elections.
Jackson stood alone in demanding that the unconstitutional districts be effectively preserved for the purposes of this election — guaranteeing Democratic seats in the midterm that could be lost in non-racially discriminatory districts. Neither Kagan nor Justice Sonia Sotomayor would join her in the dissent, despite dissenting from the Callais decision itself. However, it was her language again that drew the attention of her colleagues. Justice Jackson lambasted the court’s ruling “has spawned chaos in the State of Louisiana.” In an Orwellian twist, Jackson suggested that others were playing politics as she sought to effectively protect unconstitutional Democratic districts. She suggested that the case exposed “a strong political undercurrent.”
In arguably the most insulting line, she lectured her colleagues that this case “unfolds in the midst of an ongoing statewide election, against the backdrop of a pitched redistricting battle among state governments that appear to be acting as proxies for their favored political parties.” She further said that, rather than avoid “the appearance of partiality,” the Court’s action “is tantamount to an approval of Louisiana’s rush to pause the ongoing election in order to pass a new map.”
Justice Alito had had enough. He noted that her reliance on the 32-day period was a “trivial” objection that put form above substance since no party had asked for reconsideration. It would be waiting for 32 days for no purpose, while the other parties had stated a reasonable and pressing need to finalize the opinion. He chastised Jackson for a dissent that “lacks restraint.” He denounced the dissent as making “baseless and insulting” claims. He particularly objected to the charge that her colleagues were engaging in an unprincipled use of power” as a groundless and utterly irresponsible charge.”
What is even more chilling than Jackson’s jurisprudence is the fact that she is often cited as the model for Democrats seeking to pack the Court with an instant majority if they retake power. This and other Jackson dissents show why Democrats are so confident that packing the Court will yield lasting control of the government. Jackson recently told ABC News that “I have a wonderful opportunity to tell people in my opinions how I feel about the issues, and that’s what I try to do.” For some of her colleagues, that cathartic benefit is coming at too high a cost for the Court.

Carmakers paid through the nose to achieve … nothing.

• The EV Bust Claims Five More Victims… and They Aren’t Even EVs? (Green)

Honda’s failed bet on electric vehicles means the Japanese auto giant will have to stretch the lifecycles of five top-selling vehicles “in some cases to more than a decade,” according to a supplier memo seen by Automotive News. The company will continue selling existing versions of the Odyssey, Accord, and HR-V, as well as the Acura MDX and Integra, after writing down up to $15.8 billion worth of investments in EVs, including eliminating three new EV models for the U.S. market. Car and Driver said the 2023-issue Accord “won’t be redesigned until at least early 2030,” while “the Odyssey minivan isn’t set to be replaced until 2030, while the current HR-V SUV will see its production extended until early 2032.” The two Acura models will suffer similar delays.

It seems like just earlier this spring [It was just earlier this spring, Steve —Editor] I reported on Honda’s massive losses from betting big on EVs — with a big nudge from Big Stupid Government — but the company’s losses show up on more than just the balance sheet. That’s why models that the company actually sells and makes money on — like the aforementioned Accord — won’t see expected refreshes anytime soon. There’s this little thing called opportunity cost, which is the value of the best alternative you give up when you choose one option over another. Honda bet big on EVs, but then changing market conditions forced the company to scale back those plans to the tune of billions of dollars worth of write-downs.
Worse, however, are the updated models that would have sold in volume that the company chose not to invest in.Losing a bet this big hurts in the auto industry more than almost anywhere else, due to development times measured in years — yet vehicles are still subject to the whims of fashion. Consumers expect regular model refreshes, particularly loyal customers hoping to trade in their older car for the latest version of the same model. A two- or three-year delay means customers holding onto their current car for that much longer. Or maybe even shopping the competition.
The current version of the Odyssey minivan debuted in 2018 and hasn’t gotten anything more than a facelift in 2025. Buyers hoping to trade in for the latest and greatest have to wait another four years. Honda said in a statement, “We are not going to comment on future product plans. We are very confident and excited in our future product strategy including our previously announced plans to advance our award-winning hybrid technology to more models.” The company needed 36 words to say nothing at all.
According to Electrek, Honda’s strategy “now centers on hybrids for the near term, with affordable EVs priced under $30,000 pushed to the end of the decade. The only EV still standing in its US lineup is the Prologue, which recently saw a $7,500 price cut — a GM Ultium-based vehicle that Honda didn’t even engineer itself.” Electrek also noted that Honda completely scrapped plans for a multibillion-dollar EV plant in Canada. Don’t get me wrong, Honda makes great hybrids, and for most people looking to save money on gas, they make so much more sense than going fully electric. But hybrid versions of the company’s most-loved models that could have hit showrooms this year or next, now won’t be seen until the next decade.

‘sin at its root does not consist in the (same-sex) couple relationship, but in a lack of faith in God who desires our fulfillment.’

• Tectonic Shift In Church Framing of Homosexuality (Tim O’Brien)

Two things that non-Catholics and many Catholics don’t understand about the Catholic Church are that it’s not a democratic organization and it’s not an autocracy. In other words, as powerful as the Pope is, he cannot arbitrarily or single-handedly change doctrine and policy. At the same time, even though the church counts 1.4 billion members around the world, it is not structured to take their input into account the way representative government works in America.

Among Catholics, this confusion often pops up when the discussion turns to declining mass attendance and increases in the number of lapsed Catholics who no longer consider themselves a part of the church, even though they may have been baptized in the church. To get them back, we might argue, the church needs to allow women to be priests, or priests to get married, or to change our hard line on abortion, or to change the church’s position on LGBTQ issues. That’s not how it works, or at least, that’s not how it’s supposed to work. I know I’m going to hear from the Catholic catechism and Canon Law technicians on this oversimplification, but here goes: The church is here for Jesus Christ, the Holy Spirit and God Himself.
We exist to please God. God does not exist to please us. He is not our creation. We are His creation. From a purely administrative standpoint, the church has had to find ways over the past 2,000 years to function in a changing world. That is definitely not to say that the church has had to change with the times or change simply to stay relevant, but rather, it has had to stay true to itself in the context of the times. Against this backdrop, Pope Francis decided to convene a Synod of Bishops in 2021 to consider ways in which the church can be more responsive to the culture without diminishing its core doctrines and policies, and the catechism itself.
In the Catholic Church, a Synod of Bishops is a formal assembly where bishops meet to discuss subjects tied to doctrine, governance, pastoral practice, or mission. If there is any one approach the church uses to try to stay relevant, this would be a key method. Of course, there are many within the church who argue against a “synodal mentality,” where they feel that the desire to be more relevant or “accessible” can undermine the core attributes of the church itself. They feel too much weight is assigned to synods.
When this particular synod was convened, the church invited its members from around the globe to participate. “Listening sessions” were held at the most local of levels – the parishes. It’s been reported that millions of Catholics participated in this process, where the input and feedback received were fed up the food chain from the parishes to the dioceses; to the bishops at the local level; then to the “continental level,” and ultimately on to the Vatican. Out of this process emerged what the church called a “Working Document,” which then was reviewed in the Vatican before this final report was released.
And so, Study Group 9 of Pope Francis’s synod has now released its final report, and in it is included the testimonies of two homosexual men. This is included as part of the report’s “cases for listening.” In the slow-moving world of Vatican policy change, this is a tectonic shift.
What’s actually in the report
According to insiders, throughout the synodal process, the bishops looked more closely at a number of issues, including women’s ordination, the church and the internet, ecumenism, polygamy, the Catholic liturgy, and other things. But the headlines coming out of the final report are sure to center mostly on how it treated the LGBTQ issues. The synod’s final report includes that testimony where two “married” homosexual men, who say they are Catholic, described the church’s role in creating an atmosphere of “solitude, anguish, and stigma that accompany persons with same-sex attractions and their families.”
John-Henry Westen, co-founder of LifeSite, reacted to the release of the report on the X platform, saying that it “Suggests a reframing of homosexuality in the church, endorsing testimony without qualification that ‘sin at its root does not consist in the (same-sex) couple relationship, but in a lack of faith in God who desires our fulfillment.’” This is covered in the first couple of minutes in Westen’s video.
Sorry my shirt was wrinkled here, but this news is TOO IMPORTANT to miss. And please share it. https://t.co/ycP3tmbrmT
— John-Henry Westen (@JhWesten) May 5, 2026
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https://twitter.com/GreereMedeea/status/2051772652419748146?s=20 https://twitter.com/lakemonstercl1/status/2051607526353916257?s=20

do you understand what just happened to your computer..

Google Chrome secretly downloaded a 4GB AI model onto your device. Without asking.. Without telling you..

It's called weights.bin. It lives deep in your system folders. It powers Gemini Nano – Google's on-device AI.

And… https://t.co/qKjzl8IRa9 pic.twitter.com/hnf9Z5esan
— BuBBliK (@k1rallik) May 5, 2026

850 million children, or ONE THIRD of genZ, were murdered by their own mothers

that’s about 10 times as many deaths as during World War II https://t.co/KPGEXyLLYv pic.twitter.com/tYPjEHUVcI
— vittorio (@IterIntellectus) May 5, 2026

Neuralink progress https://t.co/IJM7hZyBRR
— Elon Musk (@elonmusk) May 7, 2026

Today marks the 24th anniversary of the assassination of Dutch politician Pim Fortuyn by a climate activist.

This clip still gives me chills every time: “The people have had enough. I stand for this country, even if it means I get slaughtered…”

Oh how different things could… pic.twitter.com/LsFxoiyJsi
— Eva Vlaardingerbroek (@EvaVlaar) May 6, 2026

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Debt Rattle July 15 2016

Jul 152016

July 15, 2016 Posted by Raúl Ilargi Meijer at 9:01 am Finance Tagged with: biodiversity, China, euro, globalism, GMO, Growth, hunger, Italy, Nice, populism 1 Response »

Dorothea Lange Farm boy at main drugstore, Medford, Oregon 1939

• (Nobody Believes) China’s Q2 GDP Growth Stable at 6.7% (ET)

• Asian Shares Rise To Eight-Month Highs (R.)

• US Exporters’ Gains From Chinese Economic Growth Shrink Further (WSJ)

• Could Italy Bring Down The Euro? (Kern)

• EU Finance Ministers Get Tough With Italian Bank Trying For Third Bailout (G.)

• Who’s Buying It? (Roberts)

• Canada New Home Prices Grow At Fastest Pace In Nearly 9 Years (R.)

• UK MPs Decry ‘Failed’ Effort To Stop London Property Money Laundering (G.)

• McKinsey Slams Globalization: “The Resentment Will Explode” (ZH)

• Globalism vs. “Populism” (Smith)

• President of Belgian Magistrates: Neoliberalism Is A Form Of Fascism (DDP)

• In New Zealand, Lands and Rivers Can Be People -Legally Speaking- (NYT)

• Obama Expected to Sign Industry-Backed GMO Label Bill Into Law (EW)

• Biodiversity Is Below Safe Levels Across More Than Half Of World’s Land (G.)

• Gleaning: Harvesting Spain’s Unwanted Crops To Feed The Hungry (G.)

I know, what does any of it mean with 100 people dying in Nice? Still, as many died in Syria.

“The speed of growth that it points to is increasingly hard to believe given the clear structural drags that the economy is facing..”

• (Nobody Believes) China’s Q2 GDP Growth Stable at 6.7% (ET)

China’s GDP grew at 6.7% year on year in the second quarter of 2016, at least officially. However, most analysts don’t believe the official figures. “The official figure is still around 7%, but those data are made in the statistical kitchen,” says Willem Buiter, the chief economist of Citigroup. He thinks China is not growing at more than 4%. After reporting 6.7% growth over the year in the first quarter of 2016, analysts were looking for 6.6% growth in the second quarter compared to the second quarter of 2015, so China managed to engineer a small beat and create the illusion of stability. Quarterly growth even picked up from 1.1% in the first quarter to 1.8% in the second quarter.

“The speed of growth that it points to is increasingly hard to believe given the clear structural drags that the economy is facing,” research firm Capital Economics writes in a note. The analysts think China grew 4.5% based on a proprietary activity index, roughly the same as in the first quarter. Private investment was the biggest drag on growth, it just expanded 1% in May, down from 15% in early 2015. State companies have picked up the slack. A survey of thousands of companies by the China Beige Book (CBB) released earlier in July paints a similar picture. CBB says most indicators improved in the second quarter, although activity is roughly flat over the year. In most cases, less than 50% of survey respondents report an improvement in sales, hiring, capital expenditure, or bank lending.

The harder they come…

• Asian Shares Rise To Eight-Month Highs (R.)

Asian shares extended gains to eight-month highs on Friday, on track for a solid weekly rise, as better-than-expected economic data from China lifted risk sentiment that was already buoyant after record highs on Wall Street. China’s economy grew 6.7% in the second quarter from a year earlier, steady from the first quarter and slightly better than expected as the government stepped up efforts to stabilize growth in the world’s second-largest economy.

Industrial output and retail sales also beat forecasts, which helped alleviate fears of slowing momentum, though fixed-asset investment growth slipped and missed market expectations. “The data showed the signs of stabilisation, which is very encouraging,” said Julian Wang, economist for Greater China at HSBC. “However, public sector investment and housing market are slowing down. So the challenges still loom quite large in the second half of the year.”

Well, that’s a surprise….

• US Exporters’ Gains From Chinese Economic Growth Shrink Further (WSJ)

China’s economic roller coaster is taking a bite out of American exporters, hurting U.S. industries ranging from mining equipment to cotton producers and adding to criticism that China is getting more than it gives in trade with the U.S. The U.S. shipped just $42.4 billion to China in the first five months of the year, or 8.2% less than the year-earlier period and 13.8% below the peak export year of 2014, according to the Census Bureau. The export drop comes as China’s economy, while slowing, is still officially expanding at more than 6% a year. That growth is driven in part by the mountain of goods—worth $174 billion so far this year—the U.S. imports from China. That is quadruple the size of its exports to China during those months, and only slightly less than 2014 levels.

The slowdown in U.S. exports could exacerbate accusations in the 2016 presidential campaign that China is engaged in unfair trade practices. Donald Trump, the presumptive Republican nominee, has cited the trade gap with China in threatening to slap new tariffs on the country if he becomes president. U.S. companies have grown increasingly vocal in criticizing Beijing for allegedly dumping subsidized steel and other products on world markets and for refusing to open major parts of its economy to foreign investment—a roadblock that almost certainly hinders two-way trade.

No doubt it could. But Brussels will first try and turn it into Greece….

• Could Italy Bring Down The Euro? (Kern)

[..] M5S’s Luigi Di Maio, who, polls show, has a very good chance of succeeding Renzi as prime minister, has reiterated his party’s long-standing call for a referendum on the euro: “We want a consultative referendum on the euro. The euro as it is today does not work. We either have alternative currencies or a ‘euro 2.’ We entered the European Parliament to change many treaties. The mere fact that a country like Great Britain even held a referendum on whether to leave the EU signals the failure of the European Union.” A referendum on the euro would be “consultative” because Italian law does not allow such plebiscites to change international treaties, including those that involve Italy’s relations with the European Union.

But Grillo is seeking a legislative change to allow an “ad hoc” exception, similar to the one in June 1989, when Italy held a consultative referendum on whether to transfer certain powers to the European Parliament. The exception would presumably be approved if M5S wins the prime minister’s office. Meanwhile, analysts are warning that the turmoil in Italy could spread to the rest of the eurozone. The risk of contagion is due to the so-called “doom loop” that exists between European governments and European banks, which have more than doubled the holdings of their own governments’ debt from a low of €355 billion in September 2008 to €791 billion today. International banks have lent Italy more than €500 billion, according to Die Welt, which reports that French banks alone hold €250 billion of Italian debt.

German banks hold €84 billion of Italian bonds. The only question, according to analysts, is whether taxpayers or bondholders will be left holding the tab. Wolfgang Münchau warned of the consequences of a disorderly Italian exit from the euro: “An Italian exit from the single currency would trigger the total collapse of the eurozone within a very short period. It would probably lead to the most violent economic shock in history, dwarfing the Lehman Brothers bankruptcy in 2008 and the 1929 Wall Street crash.” As Ambrose Evans-Pritchard of the Telegraph has pointed out, however, Italy must choose between the euro and its own economic survival. Leaving the euro “may be the only way to avert a catastrophic deindustrialization of the country before it is too late.”

…like here.

• EU Finance Ministers Get Tough With Italian Bank Trying For Third Bailout (G.)

The idea of modern banking was born in Siena in 1624, when the Medici Grand Duke decided to guarantee accounts held at Monte dei Paschi, the world’s oldest bank, with the proceeds of pasture he held in the Maremma in south-western Tuscany. Nearly 400 years later, the principle established by the Tuscan ruler – that account holders and investors are protected by the state – lies at the heart of a crisis at Monte dei Paschi di Siena (MPS) that is worrying financial markets around the world. The country’s third-largest lender has already been bailed out twice in modern Italian history but is likely to need a third multibillion-euro intervention by the Italian government – a move that would need Brussels to break new rules designed to prevent such taxpayer bailouts after the 2008 global financial crisis.

So the question of who will pay for the inevitable rescue of MPS, whose share value has fallen 80% over the past year, has yet to be answered. Three weeks after the news that Britain has voted to leave the European Union shocked the markets, a debate over the fate of MPS and the economic and political repercussions of inaction is raging from Rome to Brussels and Paris to Berlin. The welfare of thousands of Italian households is at stake, as well as the political fortune of Italy’s prime minister, Matteo Renzi, who is facing the toughest political challenge of his career. It is also testing Italy’s credibility among foreign investors. “There is no way they will let the bank go and create a systemic effect,” said Wolfango Piccoli, co-president of Teneo Intelligence. “The mechanics are still unclear but there will be a third bailout of Monte dei Paschi.”

[..] Unlike the US, Spanish and Irish financial crises, the Italian banking crisis is not the result of a speculative property bubble. While other issues have exacerbated the turmoil at Monte dei Paschi’s – including a poorly judged €9bn acquisition – the primary reason the bank is in trouble is because it doled out billions of euros in loans to small businesses at a time when the scale of the recession facing Italy was gravely underestimated. From 2007 to 2013, Italy lost about a quarter of its industrial production and tens of thousands of companies collapsed. In 2013 more than 150 shops closed every day. Construction and home sales slumped and none of the sectors has recovered fast enough.

Central banks are the only buyers left.

• Who’s Buying It? (Roberts)

With the market breaking out to all-time highs, the media has started to once again reach for their party hats as headlines suggest clear sailing for investors ahead. While I certainly do not disagree the breakout is indeed bullish, and signals a continuation of the long-term bullish trend, there are more than sufficient reasons to remain somewhat cautious. Earnings are still weak, there is little evidence of economic resurgence and inflationary pressures globally remain nascent. But, for now, a rash of global Central Banks continue to support asset prices by increasing accommodative policies either through additional reductions in interest rates or direct injections of liquidity. As Matt King from Citi recently noted: “It has been a surge in net global central bank asset purchases to their highest level since 2013.”

With the ECB in full QE mode, the BOC now using $300 billion in Pension Funds to prop up prices, and the BOJ now moving towards an additional $130 billion in QE as well, the liquidity push continues. Interestingly, despite the push by Central Banks to loft asset prices higher, individual market participants as measured by the Investment Company Institute (ICI) have a different idea. As shown in the chart below, despite asset prices ringing all-time highs, net equity inflows have turned decisively negative. This was much the same case following the 2012 market rout and it wasn’t until the launch of QE3 in 2013 that investors began to once again chase the markets.

Trudeau needs to act, and very fast, or he’ll be staring a monster in the face.

• Canada New Home Prices Grow At Fastest Pace In Nearly 9 Years (R.)

Canadian new home prices in May grew at their fastest pace in almost nine years, soaring 0.7% from April on strength in the booming markets of Toronto and Vancouver, Statistics Canada said on Thursday. Analysts polled by Reuters had predicted a 0.2% advance. May’s increase was the largest since the 1.0% jump recorded in July 2007. The Liberal government is concerned about rapidly rising prices in Toronto and Vancouver and is mulling more restrictions on mortgages. The combined region of Toronto and Oshawa – which accounts for 27.92% of the entire Canadian market – posted a 1.9% gain, the highest in 27 years.

Builders cited market conditions and the price of land. Market conditions also helped drive up new home prices in Vancouver by 1.1%. Overall, housing prices increased by 2.7% from May 2015, the largest year-on-year rise since the 2.7% advance seen in September 2010. The new housing price index excludes apartments and condominiums, which the government says are a particular cause for concern and which account for one-third of new housing.

A feature, not a bug.

• UK MPs Decry ‘Failed’ Effort To Stop London Property Money Laundering (G.)

Government attempts to stop the UK property market being exploited by international money launderers are “totally inadequate” and the country has instead “laid out a welcome mat” to criminals, the House of Commons home affairs committee has said. The influential panel of MPs, chaired by the Labour backbencher Keith Vaz, said it was disgraceful that at least £100bn was being laundered through the UK every year and astonishing that just 335 out of 1.2m property transactions last year were deemed to be suspicious by law enforcement officials. That means only 0.01% of the 2.4 million buyers and sellers in the UK generated suspicious activity reports at the National Crime Agency (NCA), whose system, Vaz said, was not fit for purpose.

“The proceeds of crime legislation has failed,” Vaz said. “London is a centre for money laundering, and its standing as a global financial centre is dependent on proactively and effectively tackling money laundering. Investment in London properties is a major route which tarnishes the image of the capital. Supervision of the property market is totally inadequate.” The NCA’s system gathers suspicious activity reports from lawyers, accountants, bankers and other professionals but is overwhelmed with more than 380,000 reports per year, when it is designed to handle 20,000. [..] The MPs said it remained “far too easy for someone intent on laundering money to buy a property with their ill-gotten gains, and rent it out in a very buoyant and robust letting market and take in clean money in perpetuity”.

As I said many times before: when growth goes, so does centralization. It seems hard to make that connection.

• McKinsey Slams Globalization: “The Resentment Will Explode” (ZH)

The IMF is getting nervous, and what it appears to be most concerned about, is a collapse of the status quo. Moments ago, in a speech in Washington, IMF head Christine Lagarde said that “The greatest challenge we face today is the risk of the world turning its back on global cooperation—the cooperation which has served us all well. We know that globalization – and increased integration – over the past generation has yielded many economic benefits for many people.” The IMF is not alone: for years, consultancy giant McKinsey towed the party line as well saying in 2010 that “the core drivers of globalization are alive and well” and adding as recently as 2014 that “to be unconnected is to fall behind.”

That appears have changing, and cracks are starting to form behind the cohesive push for globalization, at least among those who benefit the most from globalization. In a stunning study released today, one which effectively refutes all its prior conclusions on the matter, McKinsey slams the establishment’s status quo thinking and admits that the economic gains of changes in the global economy have not been widely shared lately, especially in the developed world. In the report titled “Poorer Than Their Parents? Flat or Falling Incomes in Advanced Economies” it finds that prospects for income growth have deteriorated significantly since the financial crisis, and that the benefits from globalization are now over:

This overwhelmingly positive income trend has ended. A new McKinsey Global Institute report finds that between 2005 and 2014, real incomes in those same advanced economies were flat or fell for 65 to 70% of households, or more than 540 million people. And while government transfers and lower tax rates mitigated some of the impact, up to a quarter of all households still saw disposable income stall or fall in that decade.

As Bloomberg reports, Britain’s vote to exit the European Union exemplifies what happens when people feel like the system is letting them down, Richard Dobbs, the co-leader of the research, said in an interview Wednesday, ahead of the report’s release. He likened the buildup of resentment over globalization to a dangerous natural gas leak in a row of houses. “One of them will explode. I did not think that it would be the U.K. first,” said Dobbs, a senior partner of McKinsey and a member of the McKinsey Global Institute Council in London. “When we launch a new policy, let’s think about the impact on those groups” who have been left behind, Dobbs said. Sometimes the goals of fairness and efficiency can conflict, he said. “Are we prepared to damage competitiveness a bit to reduce the risk of an explosion?”

Brandon Smith on one of my ‘hobby horses’. More good stuff in the article.

• Globalism vs. “Populism” (Smith)

The globalists have used the method of false dichotomies for centuries to divide nations and peoples against each other in order to derive opportunity from chaos. That said, the above dichotomy is about as close to real as they have ever promoted. As I explained [earlier], the recent passage of the Brexit referendum in the U.K. has triggered a surge of new propaganda from establishment media outlets. The thrust of this propaganda is the notion that “populists” are behind the fight against globalization and these populists are going to foster the ruin of nations and the global economy. That is to say – globalism good, populism bad. There is a real fight between globalists and those who desire a free, decentralized and voluntary society.

They have just changed some of the labels and the language. We have yet to see how effective this strategy will be for the elites, but it is very useful for them in certain respects. The wielding of the term “populist” is about as sterilized and distant from “freedom and liberty” as you can get. It denotes not just “nationalism,” but selfish nationalism. And the association people are supposed to make in their minds is that selfish nationalism leads to destructive fascism (i.e. Nazis). Therefore, when you hear the term “populist,” the globalists hope you will think “Nazi.” Also, keep in mind that the narrative of the rise of populism coincides with grave warnings from the elites that such movements will cause global economic collapse if they continue to grow.

Of course, the elites have been fermenting an economic collapse for years. We have been experiencing many of the effects of it for some time. In a brilliant maneuver, the elites have attempted to re-label the liberty movement as “populist” (Nazis), and use liberty activists as a scapegoat for the fiscal time bomb THEY created. Will the masses buy it? I don’t know. I think that depends on how effectively we expose the strategy before the breakdown becomes too entrenched. The economic collapse itself has been handled masterfully by the elites, though. There is simply no solution that can prevent it from continuing. Even if every criminal globalist was hanging from a lamp post tomorrow and honest leadership was restored to government, the math cannot be changed and decades of struggle will be required before national economies can be made prosperous again.

By Manuela Cadelli, President of the Magistrates’ Union of Belgium. Bit older, but interesting reasoning.

• President of Belgian Magistrates: Neoliberalism Is A Form Of Fascism (DDP)

Every totalitarianism starts as distortion of language, as in the novel by George Orwell. Neoliberalism has its Newspeak and strategies of communication that enable it to deform reality. In this spirit, every budgetary cut is represented as an instance of modernization of the sectors concerned. If some of the most deprived are no longer reimbursed for medical expenses and so stop visiting the dentist, this is modernization of social security in action! Abstraction predominates in public discussion so as to occlude the implications for human beings. Thus, in relation to migrants, it is imperative that the need for hosting them does not lead to public appeals that our finances could not accommodate. Is it In the same way that other individuals qualify for assistance out of considerations of national solidarity?

Social Darwinism predominates, assigning the most stringent performance requirements to everyone and everything: to be weak is to fail. The foundations of our culture are overturned: every humanist premise is disqualified or demonetized because neoliberalism has the monopoly of rationality and realism. Margaret Thatcher said it in 1985: “There is no alternative.” Everything else is utopianism, unreason and regression. The virtue of debate and conflicting perspectives are discredited because history is ruled by necessity. This subculture harbours an existential threat of its own: shortcomings of performance condemn one to disappearance while at the same time everyone is charged with inefficiency and obliged to justify everything. Trust is broken. Evaluation reigns, and with it the bureaucracy which imposes definition and research of a plethora of targets, and indicators with which one must comply. Creativity and the critical spirit are stifled by management.

In general, everywhere native people get an actual say, things improve.

• In New Zealand, Lands and Rivers Can Be People -Legally Speaking- (NYT)

Can a stretch of land be a person in the eyes of the law? Can a body of water? In New Zealand, they can. A former national park has been granted personhood, and a river system is expected to receive the same soon. The unusual designations, something like the legal status that corporations possess, came out of agreements between New Zealand’s government and Maori groups. The two sides have argued for years over guardianship of the country’s natural features. Chris Finlayson, New Zealand’s attorney general, said the issue was resolved by taking the Maori mind-set into account. “In their worldview, ‘I am the river and the river is me,’” he said. “Their geographic region is part and parcel of who they are.”

From 1954 to 2014, Te Urewera was an 821-square-mile national park on the North Island, but when the Te Urewera Act took effect, the government gave up formal ownership, and the land became a legal entity with “all the rights, powers, duties and liabilities of a legal person,” as the statute puts it. “The settlement is a profound alternative to the human presumption of sovereignty over the natural world,” said Pita Sharples, who was the minister of Maori affairs when the law was passed. It was also “undoubtedly legally revolutionary” in New Zealand “and on a world scale,” Jacinta Ruru of the University of Otago wrote in the Maori Law Review.

Personhood means, among other things, that lawsuits to protect the land can be brought on behalf of the land itself, with no need to show harm to a particular human. Next will be the Whanganui River, New Zealand’s third longest. The local Maori tribe views it as “an indivisible and living whole, comprising the river and all tributaries from the mountains to the sea — and that’s what we are giving effect to through this settlement,” Mr. Finlayson said. It is expected to clear Parliament and become law this year.

How crazy is this? ‘Misinformation is also information’.

• Obama Expected to Sign Industry-Backed GMO Label Bill Into Law (EW)

Looks like we’re finally getting GMO labels on food products—just not the kind you can actually read. President Obama is expected to throw his weight behind a controversial bill that allows businesses to use a smartphone scannable QR code instead of clear, concise wording that informs consumers if a product contains genetically modified ingredients. The bill would also nullify state-by-state GMO labeling mandates such as Vermont’s landmark law that took effect on July 1. “While there is broad consensus that foods from genetically engineered crops are safe, we appreciate the bipartisan effort to address consumers’ interest in knowing more about their food, including whether it includes ingredients from genetically engineered crops,” White House spokeswoman Katie Hill told Bloomberg in an e-mail.

“We look forward to tracking its progress in the House and anticipate the president would sign it in its current form.” The House of Representatives is voting today on legislation from the Senate, which voted 63 to 30 in favor of the bill on July 7, less than a week after Vermont enacted its GMO label law. The bipartisan “compromise” bill was conceived after years of negotiations by Democrat Sen. Debbie Stabenow and Republican Sen. Pat Roberts and is supported by the very industry that produces and profits from such products, including the powerful Grocery Manufactures Association and world’s largest seed producer and pesticide giant Monsanto. UPDATE: The U.S. House of Representatives passed the bill by a 306-117 vote Thursday. The bill now heads to President Obama’s desk.

Can’t stop the brilliance of the human brain.

• Biodiversity Is Below Safe Levels Across More Than Half Of World’s Land (G.)

The variety of animals and plants has fallen to dangerous levels across more than half of the world’s landmass due to humanity destroying habitats to use as farmland, scientists have estimated. The unchecked loss of biodiversity is akin to playing ecological roulette and will set back efforts to bring people out of poverty in the long term, they warned. Analysing 1.8m records from 39,123 sites across Earth, the international study found that a measure of the intactness of biodiversity at sites has fallen below a safety limit across 58.1% of the world’s land. Under a proposal put forward by experts last year, a site losing more than 10% of its biodiversity is considered to have passed a precautionary threshold, beyond which the ecosystem’s ability to function could be compromised.

“It’s worrying that land use has already pushed biodiversity below the level proposed as a safe limit,” said Prof Andy Purvis, of the Natural History Museum, and one of the authors. “Until and unless we can bring biodiversity back up, we’re playing ecological roulette.” Researchers said the study, published in the journal Science on Thursday, was the most comprehensive examination yet of biodiversity loss. The decline is not just bad news for the species but in the long term could spell problems for human health and economies. “If ecosystem functions don’t continue, then yes it affects the ability of agriculture to sustain human populations and we simply don’t know at which point that will be reached,” said Dr Tim Newbold, lead author of the work and a research associate at University College London. “We are entering the zone of uncertainty.”

There’s a man and then there’s ‘a mensch’.

• Gleaning: Harvesting Spain’s Unwanted Crops To Feed The Hungry (G.)

Under a blazing Catalan sun, Abdelouahid wipes the sweat from his brow in a cabbage patch full with clouds of white butterflies. “It’s really not warm today,” he says. “It’s only hot if you stop working.” Around him, unemployed workers and environmentalists squat in green bibs, black gloves and hats, plucking cabbages that would otherwise be threshed, to distribute at food banks around Barcelona. A 39-year-old Moroccan emigré with two small children, Abdelouahid began “gleaning” – harvesting farmers’ unwanted crops – with the Espigoladors (gleaners) after losing his job in the construction industry four years ago. It is Ramadan and he is fasting but still smiling as he cuts at the green jewels.

“I don’t like to spend my days at home, sending CVs to employers, waiting for their rejection letters, or going around the restaurants trying to find food,” he says. “I prefer to do something positive. A lot of people need this food. It is better to collect it than to leave it.” Europe wastes some 88m tonnes of food each year – around 173 kg per person – with costs estimated at €143bn (£113bn). Advocates of the new gleaning movements say that its collection could reduce pressure on land use, improve diets, feed the hungry and provide work for the socially excluded.

For now, most of its recovered foods go to food banks, but the Espigoladors social enterprise has launched an “Es Imperfect” (is imperfect) brand of jams, soups and sauces made from recovered produce. The line is growing so fast that the day after the cabbage picking, the project’s founder, Mireia Barba, was called to a meeting of Cotec, King Felip VI’s national development foundation. Another fruit of the gleaning project has been an “I’m imperfect too” advertising campaign which challenges conventional ideas of food and beauty, by using photos of ordinary people holding painted fruit. The idea was to change misconceptions about browned, soft or unusually shaped fruit and veg being any less tasty.