Happy Friday the 13th, everyone! Good job numbers drop, a court win for Trump on deportations, more California fraud, more Chinese researchers stealing secrets, and the cure for global warming is global warming.
It’s the Friday LinkSwarm!
Naturally, a week after I blog about the “no hire, no fire” economy, it comes out that the economy added 130,000 in January, the most since December 2024. “However, the report shows the U.S. only added 181,000 jobs in 2025.” And the numbers for previous months keep getting revised downwards.
As I’ve said before, I’ll believe we’re out of the Biden Recession when I have a job again…
Petitions for Habeas Corpus to release illegal aliens from detention, or at least grant them bond hearings, have overwhelmed the federal courts, with most district court judges who have ruled on the subject siding with the detained aliens. It was the practice of prior administration from both parties to grant bond hearings. But is it a legal requirement?
A ruling by the 5th Circuit Court of Appeals, which covers critical border state Texas, has rejected the argument that a bond hearing and release is required by law. To the contrary, it held that the applicable legislation passed by congress does not require such bond hearings or release. That prior administrations did not exercise their full powers of detention under the law did not mean the present Trump administration could not do so, the court ruled.
Another win for secure borders and the rule of law in the face of massive leftwing judicial resistance.
The House of Representatives on Wednesday night passed the new Republican-led Safeguard American Voter Eligibility (SAVE) America Act, which requires individuals to present proof of citizenship to register to vote and requires Americans to show ID when voting.
The House passed the legislation, which combined two bills, in a 218-213 vote. The bill saw little support from House Democrats, with Texas Rep. Henry Cuellar being the sole Democrat to join Republicans in passing the legislation.
“It’s just common sense,” House Speaker Mike Johnson told reporters of the legislation. “Americans need an ID to drive, to open a bank account, to buy cold medicine, to file government assistance. So why would voting be any different than that?”
Senate Democrats, of course, with the exception of John Fetterman, will do anything to prevent it from being passed. If they can’t cheat, they can’t win…
Stephen Green: California raked off $370M in taxpayer money to bankroll leftwing activism.
1. Californians voted to fund youth drug prevention through the Cannabis Tax. Instead, $370M in revenue is bankrolling leftwing activism.
2. The money flows through a single unelected nonprofit – The Center at Sierra Health Foundation’s Elevate Youth program.
3. The Center has gotten rich off this arrangement – growing from $11.8M in 2018 to $197M in 2024. The CEO makes over $600K.
4. The Center runs Prop 64 dollars through to a web of NGOs, including the Jakara Movement, Young Invincibles, and Asian Refugees United – for activism, organizing, and voter registration.
5. This is not drug prevention – it’s a taxpayer funded pipeline from the governor’s office to leftwing political organizing.
Snip.
“The state does not pick who gets the grants,” CAL DOGE said. “The intermediary does, bypassing the rigorous procurement processes mandated for direct government contracts under the Department of General Services and State Controller oversight.”
That’s a multimillion-dollar slush fund, in other words, in which tax dollars pass through to the well-connected for the purpose of maintaining Democrat control of the state. And, one presumes, lining pockets along the way —allegedly including Newsom’s:
According to the California Fair Political Practices Commission’s Behested Payment Transparency Report (pg.19-20), in 2020 alone, Sierra Health Foundation was the third-largest payor of behested payments statewide at $14,747,724 and the single largest payee of behested payments statewide at $30,869,901 — payments Newsom solicited from private companies.
“Newsom himself was the top behesting official in the state that year at $226.8 million total,” the report continued, “and Sierra Health Foundation ranked among his top three financial partners in the system.
Los Angeles spent about $418 million on homelessness programs in 2025, yet only a small share went toward helping people leave the streets for good, according to the New York Post. A recent City Hall report suggests most of the money supports short-term services that manage homelessness rather than resolve it.
The review, released as the city prepares major budget cuts, shows that hundreds of millions were directed to hygiene facilities, outreach teams, temporary housing, and vehicle-living programs with limited long-term success. These efforts often keep people in transitional situations instead of moving them into permanent homes.
The Post noted that councilwoman Monica Rodriguez condemned the system, saying, “We’re hemorrhaging money on a homelessness system that was never designed to succeed — and no one is being held accountable for the failure.”
She also argued that ineffective programs are protected instead of evaluated: “If we really wanted to do something about this crisis, we would be advancing real oversight, demanding results, and shutting down programs that don’t work — not protecting a system that keeps spending more while delivering less.”
It’s not designed to end homelessness, its designed to line the pockets of the Homeless Industrial Complex and leftwing activists.
Indeed, California’s entire NGO funding structure is designed to avoid scrutiny.
The money moves smoothly, the explanations pile up, and the ability to see end-to-end quietly disappears. The deeper the look went, the more consistent the pattern became. California doesn’t struggle to explain where the money goes. It has arranged things so the explanation never quite arrives.
Snip.
When the information is pulled in its entirety and organized outside the state’s presentation layer, the scope becomes impossible to miss. More than 1,100 vendors associated with humanitarian-related contracts. Roughly $8.8 billion flowing through them. Not scattered grants. Not pilot programs. An economy of vendors, operating continuously, funded at scale. The dashboard never highlights that universe. It doesn’t need to. It only needs to make seeing it difficult enough that most people never try.
At the same time, at the federal level, the Small Business Administration acknowledged what everyone working in procurement already understands. Billions of dollars under review. Tens of thousands of entities flagged for potential fraud exposure. Large systems, large sums, limited verification, delayed audits. The numbers don’t have to match perfectly to rhyme. They already do. When separate data streams begin pointing toward the same structural vulnerabilities, the story stops being about isolated actors and starts being about architecture.
Requests for clarity meet resistance long before they reach conclusions. Public records requests stall. Narrow questions expand into bureaucratic negotiations. Specific funding totals become “unavailable.” Amy Reihart’s experience in San Diego fits neatly into this rhythm. The data is said to be public, but pulling it cleanly proves elusive. The formal channels exist, but they lead nowhere quickly. What’s left is a familiar posture from the state: the information is technically available, practically unreachable, and always just one more step away.
The same rhythm shows up in how California moves money on the ground. Childcare subsidies offer a clean example. In many states, the government pays providers directly. The path is short. Attendance aligns with eligibility. Eligibility aligns with reimbursement rates. Payments can be checked against records without heroic effort. In California, that line bends. Funds are routed through intermediary NGOs charged with administering the program. The state pays the intermediary. The intermediary interfaces with providers. Documentation flows inward. Payments flow outward.
Following that path takes work. First, identify which NGO controls which geography. Then locate its audit filings, assuming they are current and complete. Then reconcile those filings with procurement records that are already difficult to interrogate. Only after that does the provider level come into view. Each step adds distance. Each handoff adds discretion. Sources describe monthly subsidy flows exceeding $1,400 per child with minimal verification. Whether every dollar is misused is unknowable from the outside. What is visible is how easily the structure absorbs misuse without producing alarms.
That same opacity shows up beyond childcare. Walk through downtown Los Angeles and the conversations repeat. Not policy debates. Observations. Barbers, bartenders, people who work late and walk home early. The homeless system comes up unprompted. Everyone knows how much money moves through it. Everyone knows how little seems to change. Deliveries arrive at storefronts with no customers. Benefits circulate with minimal identification. Stories circulate about organized applications and quiet laundering through approved channels. None of this appears on a dashboard. It doesn’t need to. It lives in the gap between official narratives and daily experience.
The system doesn’t rely on secrecy. It relies on diffusion. Money enters labeled as humanitarian assistance, housing support, community partnership. It passes through nonprofit layers that soften scrutiny and multiply explanations. By the time it reaches the ground, responsibility is spread thin enough that no single ledger tells the whole story. Each participant can point upward or downward and remain technically correct. Oversight exists everywhere in theory and nowhere in practice.
Organizations operating at the intersection of activism and public funding sit comfortably inside this environment. The Solidarity Research Center in Los Angeles, connected to broader political networks, is one example drawing attention. Not because of slogans or mission statements, but because proximity to power and insulation from scrutiny tend to travel together. When funding, politics, and moral language overlap, questions are framed as attacks and audits become optional. The structure does the work long before anyone has to defend it.
The contrast between damage and response is hard to ignore. Drive through the Palisades fire zone and the destruction remains visible. Burned properties. Long stretches untouched. The rebuild lags. The NGO signage does not. Clean placards promise recovery, resilience, and renewal, often paired with donation links. The messaging arrives faster than the materials. The branding arrives faster than the permits. Money is already being organized, even as the outcomes remain distant. It’s a familiar sight in California: urgency in fundraising, patience in results.
None of this happens by accident. The systems are too consistent. The barriers appear in the same places. Presentation layers substitute for access. Intermediaries substitute for accountability. Requests for detail meet friction rather than answers. The result is a machine that keeps moving regardless of whether anyone outside it can explain how. For the people inside, it works. For the public, it produces impressions instead of records.
The report’s overview notes the beaming confidence of Georgia Secretary of State Brad Raffensperger on the morning after the election. Appearing on the Today Show, Raffensperger said a record 4.7 million Georgia voters cast a ballot in the election. More importantly, the secretary of state said only 2 percent of the ballots remained to be counted. Trump, at that time, led Biden by nearly 104,000 votes, seemingly more than enough for a Georgia win. Raffensperger, at the time, said about 94,000 ballots had yet to be counted.
“We can see where the candidates are right now in both presidential, congressional, senatorial. When you look at how many votes are out there, even if one of the candidates got 100 percent it probably wouldn’t be enough to move it on way or another,” the elections official told the Today Show crew. He should know, the report notes. The secretary could see the numbers in real time through the state elections database.
Raffensperger added that his office would wait until everything was done.
When the dust settled, the confident secretary turned out to be very wrong. The final vote count — at least then — was an incredible 5.023 million. Between the time Fulton County’s polls closed on Election Day and the final ballot was tallied, the number of absentee ballots soared from 74,000 to more than 148,000, according to the report.
Trump went from the verge of winning a key battleground state to losing it. Just like that.
“At the time of this writing, no known explanation has been provided to justify” the surge in ballots, the report states.
Snip.
The number of absentee ballots counted doesn’t match the number of credited voters, the report notes. It draws from Fulton County and state records that show 148,318 ballots were counted in the 2020 election, although only 125,784 voters were recorded as casting an absentee ballot. That’s a difference of 22,534 votes between the absentee ballots tallied and the number of individuals given credit for voting.
“Remember: the margin between President Trump and Joe Biden was 11,779 votes…and that was the THIRD certified number and didn’t match either of the first two counts….the counties could not get their numbers to match from the first count to the second to the third…..
Ukraine also hit a GRAU arsenal in Volgograd with multiple missiles. GRAU is the umbrella organization for Russian logistics.
While Russia has continued to eek out ever smaller territorial gains at high cost, Ukraine just liberated 100 square kilometers of territory in Huliaipole, Zaporizhzhia oblast. “Ukrainian forces have liberated the towns of Dobropillia, Pryluky, Olenokostiantynivka and part of Varvarivka in an assault south on the Zaporizhzhia Frontline.”
Scientists at the University of California, Irvine have discovered that climate change is causing nitrous oxide, a potent greenhouse gas and ozone-depleting substance, to break down in the atmosphere more quickly than previously thought, introducing significant uncertainty into climate projections for the rest of the 21st century.
A recent watchdog report revealed that several top-ranked American universities have brought in Chinese academics who have links to Chinese military-linked technology firms like tech behemoth Huawei and other Chinese firms linked to the CCP’s state security endeavors.
A conservative non-profit watchdog group, the American Accountability Foundation, reported that it found nearly two dozen Chinese academics working at elite U.S. schools and labs “who, because of the dual-use threat of their research, close ties to the military research sector in China, and/or clear ties to the Chinese Communist Party” and as such “should be expelled from the United States or never be re-admitted.”
The new AAF report pointed out that multiple Chinese students working at American universities had previously collaborated on projects with researchers at Huawei, including working with researchers at the Internal Cybersecurity Lab at Huawei.
Just the News also found that at least one of the Chinese academics had also worked at iFlytek — a similarly blacklisted Chinese company which often collaborates with Huawei. The U.S. National Security Commission on Artificial Intelligence stated in 2021 that “national champion” firms such as Huawei and iFlytek help “lead development of AI technologies at home” and “advance state-directed priorities that feed military and security programs.”
Snip.
The AAF report argued that Guangyao Chen “poses a high national-security and dual-use risk due to his expertise in adversarial machine learning” and that “this risk is amplified by his training at Peking University, PRC government funding, and collaborations with PRC universities and Huawei, placing his work squarely within China’s military-civil fusion ecosystem.”
Chen currently appears to be affiliated with Cornell. The ResearchGate page for Chen says that his “top co-authors” include Lin Du, a researcher at Huawei. Chen appears to have conducted multiple research projects with the Huawei researcher. The Huawei scientist’s ResearchGate profile lists Du’s skills and expertise as being “computer vision,” “object recognition,” and “machine learning.”
Snip.
Meng Wanzhou, Huawei’s CFO and the daughter of the company’s founder, was arrested by Canadian authorities in December 2018 at the request of the U.S., indicted in the Eastern District of New York in January 2019, and charged with bank fraud and wire fraud as well as conspiracy to commit both, but was allowed to walk free by the Biden Administration in 2021 in a deferred prosecution agreement wherein she admitted violating U.S. law.
Snip.
Fengqui You, a Cornell professor, leads the Fengqui You Research Group at Cornell, which is “pushing the boundaries of systems engineering, artificial intelligence, and data science.”
Chen is listed as a member and Fengqui You is listed as the principal investigator for the lab. You attended Tsinghua University, which the House Select Committee on the CCP has warned about. You did not immediately respond to a request for comment.
Snip.
The report by AAF said that Cen Zhang’s “prior work with Chinese entities and his influential role at Georgia Tech is highly concerning given the nature of computer science’s impact on U.S. national security.”
Zhang co-authored a 2021 paper on “Practical Binary Fuzzing Framework for Programs of IoT and Mobile Devices” — related to security vulnerabilities for mobile phones and other smart devices — with co-authors Xiaoxing Luo and Miaohua Li from the Internal Cyber Security Lab at Huawei Technologies.
Zhang has also conducted research with Hongxu Chen, who now lists himself as a lead engineer at Huawei, and who also went to Nanyang Technological University.
Zhang’s personal curriculum vitae also says he was previously an algorithm and engine development engineer for iFlytek. Zhang says on his GitHub page that he won the “Best New Employee Award of Year” at iFlytek in 2017.
The firm has long received state support and recognition from China’s government. The company was named a national “AI champion” by the Chinese Ministry of Science and Technology in 2018.
The Commerce Department said in October 2019 that iFlytek was among more than two dozen Chinese entities added to a U.S. blacklist, saying they were “implicated in human rights violations and abuses in the implementation of China’s campaign of repression, mass arbitrary detention, and high-technology surveillance against Uighurs, Kazakhs, and other members of Muslim minority groups.” Liu Qingfeng, iFlytek’s founder and CEO, is also a deputy to the National People’s Congress, the CCP’s rubber-stamp national legislature.
There are problems with how this piece is organized, but I wanted to capture the names (some of which are are already familiar) to keep track of them. At this point, any organization that hires a Chinese national for scientific research should assume they’re stealing data.
The legislation raises the current $10 billion asset threshold that caps debit card fees for banks and index annually to inflation.
Sen. Cruz said, “The Durbin Amendment was not designed for the current economic and regulatory reality and subjects community banks to fee limits that the original language intended for much larger institutions. My legislation modernizes the interchange fee cap to reflect inflation, helping small banks support local economies while lowering banking costs for Americans.”
Sen. Britt said, “As we’ve seen in so many instances, countless regulations in the Dodd-Frank Act were not only onerous but set fixed thresholds that have become outdated over time, and the Durbin Amendment is no exception. The largest burden is on our smallest financial institutions who provide vital sources of credit to Main Streets that drive our local economies. This commonsense legislation would simply index, to both inflation and COLA, the outdated threshold in this provision of Dodd-Frank, ultimately providing relief for our community banks who were never intended to be burdened by this regulation.”
Companion legislation was introduced in the House by Rep. Andy Barr (R-KY-6).
Rep. Barr said, “The Durbin Amendment was sold as a win for consumers in the Dodd-Frank Act by Democrats. Instead, it’s hurt Kentucky’s community banks and credit unions that do so much for underserved communities by limiting their ability to grow and compete with larger financial institutions. I’m working with Senator Cruz to fix this — because Washington shouldn’t be picking winners and losers at the expense of our local banks and the families they serve.”
This bill is supported by Americans for Tax Reform, Independent Bankers Association of Texas, and the Texas Bankers Association.
A new political organization has launched with the stated goal of countering one of Austin’s most powerful and long-standing special interest groups.
Republicans Against Texans for Lawsuit Reform, a 501(c)(4) organization, announced its formation this week. It is positioning itself directly against Texans for Lawsuit Reform (TLR), the influential tort reform group that has played a major role in Texas politics for decades.
On its website, Republicans Against Texans for Lawsuit Reform (RATLR) accuses TLR of abandoning its original mission and becoming what it describes as a major player in the “Austin swamp.” The group argues that TLR, which began in the mid-1990s advocating civil tort reform, now prioritizes the interests of “big business, big pharma, and big insurance” over conservative policy outcomes and Texas citizens.
RATLR also points to millions of dollars in political donations—including contributions to Democrats and Republican incumbents it labels as “RINOs”—as evidence that TLR wields outsized influence at the Texas Capitol.
“Protecting big business, big pharma, and big insurance should never override protecting you, Texas’ citizens,” the group states.
RATLR says it plans to focus on grassroots education and outreach, including speaking engagements with conservative groups across the state. The executive director is James Wesolek, the former communications director for the Republican Party of Texas.
So here’s a longish essay by Hugh Hendry on gold, Bitcoin and fiat money. I don’t necessarily agree with everything, but he has a provocative argument that creation of fiat money was justified to keep the entire economic system from breaking down.
he defining monetary lesson of the twentieth century was not ideological. it was traumatic. it emerged not from debates about socialism versus capitalism, or keynes versus hayek, but from the lived experience of what happens when economic systems impose rigidity on societies already under extreme stress.
after the first world war, germany was not a failed society. it was bruised, diminished, politically unstable, and deeply resentful, but it remained functional. industry existed. labour existed. institutions existed. the system was strained, not yet broken. the collapse came later, and it was not inevitable.
versailles changed that.
the treaty was not merely punitive. it was vindictive and economically illiterate. reparations were demanded in hard terms, payable in gold, at precisely the moment germany’s productive capacity was being constrained. forgiveness was absent. flexibility was absent. economic reality was ignored.
when germany struggled to meet those obligations, the response was not renegotiation but enforcement. in 1923, french and belgian forces occupied the ruhr valley, seizing control of germany’s industrial heartland, its coal, its steel, its metal production, while still demanding gold payments to the allied victors. output was taken. gold was still required. rigidity was imposed from both ends.
this was the breaking point.
what followed was not ideological radicalisation in the abstract, but economic paralysis in practice. unemployment surged. production collapsed. a growing share of the adult population became economically useless. not inefficient. not underpaid. useless. idle. watching. waiting. that condition does not produce reflection or moderation. it produces rage. and hyper-inflation.
hard money did not cause the collapse of weimar germany. but it failed catastrophically to absorb the trauma. and when institutions fracture under mass unemployment, money fractures with them. hyperinflation wasn’t softness. it was panic. it was the monetary expression of legitimacy evaporating in real time.
that sequence mattered. and it was remembered.
a decade later, the world faced another shock that threatened to replay the same pattern at a far larger scale. the crash of 1929 produced mass unemployment, collapsing demand, and the genuine possibility that the american system would follow germany down the same path. the ingredients were familiar: idle men, shuttered factories, political stress, and a rigid monetary framework that transmitted pressure rather than absorbing it.
this time, the response changed.
gold was abandoned as the governing constraint, not because it was immoral or discredited, but because it was brittle. too rigid to cope with systemic trauma. under gold, pressure concentrates until something snaps. under fiat, pressure disperses. elasticity replaced purity. monetary doctrine abandoned to keep the system intact.
the response was ugly. it was unfair. it produced deserved anger. but it worked.
the united states survived intact. unemployment was brutal, but the political centre held. extremism remained marginal. fiat didn’t heal the trauma, but it prevented it from metastasising. that became the lesson: in moments of economic shock, hardness accelerates entropy, while monetary elasticity buys time. and time, in stressed societies, is the difference between repair and collapse.
this was not an argument against scarcity. it was an argument against rigidity in the wrong place, at the wrong time. fiat emerged not as an ideological triumph, but as an adaptive response to the catastrophic failure of hard constraints under conditions of mass unemployment.
that distinction matters, because bitcoin did not arrive to overturn this lesson. it arrived long after, in its aftermath.
fiat’s ugly success.
over the subsequent century, that logic has been tested repeatedly, and each time it has been reaffirmed under pressure.
the global financial crisis of 2008 was not a scare or a stress test. it was a system-wide cardiac arrest. the banking system was insolvent in any meaningful sense. the only open question was whether circulation could be restarted before institutional damage became permanent. the response was not elegant. rules were bent. balance sheets were expanded. losses were socialised. hard constraints were suspended to keep the system alive. it was ugly, unfair, and morally nauseating to me and many others. it also worked.
the same pattern repeated during the pandemic. supply chains froze. borders closed. hospitals filled. the phrase “human extinction” escaped the laboratory and entered the bloodstream of culture. belief alone was enough to threaten collapse. once again, fiat leaned in. too much some say. money expanded. credit expanded. time was frozen. people were paid to stay home while the system was held upright. once again, rigidity was rejected in favour of elasticity. once again, the worst tail events were avoided.
this is what fiat does well.
it absorbs shocks that hard systems transmit. it disperses pressure instead of concentrating it. it allows societies to survive periods of mass dislocation without forcing immediate liquidation of people, institutions, or legitimacy. in a world repeatedly exposed to financial crises, pandemics, and geopolitical shocks, this has proven to be a feature, not a bug.
elasticity, however, is not free.
the cost shows up as inflation. not as a temporary inconvenience, but as a ratchet. prices spike, settle, and then remain elevated. grocery bills do not return to their old levels. this is the mechanical consequence of pushing risk forward in time. fiat smooths the present by borrowing from the future.
this matters most for those without assets. for the disenfranchised, inflation is not a macroeconomic abstraction or a debate about models. it is a daily budgetary pressure. rent before wages. food before leisure. energy before dignity. when prices ratchet higher, there is no portfolio adjustment, no rebalancing, no clever hedge. there is only less room to breathe.
modern financial systems are exceptionally effective at protecting those who already participate in them. the franchise holders. equities rise with nominal growth. property absorbs inflation and then some. credit, leverage, index-linked instruments, real assets, productive ownership. the menu is broad, liquid, and proven. elasticity doesn’t destroy capital for insiders. it often enriches them. asset prices inflate faster than wages precisely because the system is designed to keep capital mobile and solvent.
the burden falls elsewhere.
what inflation punishes is not thrift in some moral sense, but exclusion. money left idle because it must be. capital that cannot move because it does not exist. patience without agency. this is not a judgment about behaviour. it is a structural outcome. fiat rewards participation and mobility, not fairness. and over long periods of sustained monetary elasticity, that distinction compounds into something corrosive. something unfair.
A former Drug Enforcement Administration (DEA) official appointed as deputy chief of the Office of Financial Operations during the Obama administration – and who still holds a security clearance – was indicted on Friday on charges of agreeing to launder $12 million for the Jalisco New Generation Cartel (CJNG) – which was designated a Foreign Terrorist Organization in February of this year.
At this point, every Obama or Biden alum that still has any sort of security clearance needs to be reviewed. Hell, maybe the Trump Administration just needs to yank them all and only restore them on a case-by-case basis.
Paul Campo, who oversaw the FBI’s money laundering operations and resigned in January 2016 ahead of Trump’s inauguration, laundered around $750,000 for the cartel by converting cash into cryptocurrency, and agreed to launder far more – totaling over $12 million, according to the indictment.
“I refuse to work for Trump! But I will work for a Mexican drug cartel!”
Campo’s home was raided by federal agents on Thursday.
Campo also provided a payment for around 220 kilos of cocaine on the understanding that the drugs had been imported into the USA, the indictment further states.
He was able to do this after spending 25 years at the DEA, rising to a high-level position which he used to sell himself to CJNG as someone who could;
give inside information on DEA operations
help them move drug money
help them avoid detection
and even advise on narcotics logistics
25 years in the trade and the first narco he approaches turns out to be a narc? That’s some mighty fine work, Lou.
Then again, maybe not. Maybe he was already working for other cartels. Or had merely approached them only to have them think he was too dim to trust.
Hank Schrader had more situational awareness than this guy.
In late 2024, Campo, along with a friend Robert Sensi, began conspiring with an undercover government source they believed was with the cartel. They allegedly discussed using drones packed with C-4 explosives for CJNG operation. When the undercover agent asked what they could do with the drones, Campo allegedly said “We put explosives and we just send it over there,” adding that six kilos of C-4 would be enough to blow up “the whole fucking…” [sentence trails off]
I’m starting to get a serious whiff of Walter Mitty here.
Campo also allegedly told the undercover source that, because of his past work inside DEA’s intelligence and financial units, he still had “connections” within the agency and could advise CJNG on how to evade detection. According to the indictment, he portrayed himself as someone who understood DEA investigative patterns, internal targeting systems, and the vulnerabilities of U.S. financial controls.
Both Campo and Sensi allegedly assured the undercover officer that they could convert cartel cash into cryptocurrency in a way that would appear legitimate, billing themselves as specialists capable of “getting money back” for clients whose assets had been seized by law enforcement.
A series of staged transactions followed
Beginning in early 2025, the DEA source delivered multiple bulk-cash installments to the defendants under the guise of CJNG proceeds—first $200,000 in Charlotte, North Carolina, then additional transfers totaling more than $187,000 over the following days. Campo and Sensi allegedly converted the funds into cryptocurrency and reassured the source that they would charge an 8% commission for future laundering.
According to prosecutors, the two men also repeatedly affirmed that they were prepared to launder significantly larger sums. During one meeting, Campo allegedly said he and Sensi could easily move “millions” for the cartel through real-estate transactions, prepaid cards, and crypto channels that would not be flagged by U.S. financial institutions.
By July 2025, the indictment states, the undercover source delivered an additional $276,000 that the defendants believed to be CJNG drug proceeds. A second cash drop occurred in September. Each time, prosecutors say, Campo pitched the source on expanding their partnership into a long-term laundering pipeline.
The most damning allegation involves narcotics trafficking.
In October 2025, the DEA source told Campo and Sensi that a shipment of more than 220 kilograms of cocaine had already entered the United States and required payment. Campo and Sensi allegedly agreed to help facilitate the transaction, with Campo telling the source that once the funds were converted and returned, CJNG would “release the shipment” and continue to work with them.
The indictment asserts that Campo, Sensi, and their co-conspirators were to receive 30% of the proceeds – roughly $1.5 million – for their role in the cocaine deal, and an additional fee for converting the remainder into cryptocurrency. Campo then allegedly urged the undercover source to “move the product now,” signaling they were ready to operationalize the narcotics pipeline.
A guy who specializes in money laundering should be able to get a job at any of thousands of banks. Yet his need for money was evidently so great that he tried to sell himself to the cartels.
Obama wasn’t exactly staffing his agencies with the best and brightest…
A group of states is suing the Security Exchanges Commission (SEC), claiming the commission is overstepping its authority in regulating digital assets like cryptocurrencies — arguing that the SEC’s actions stifle state-level innovation and impose federal control without congressional approval.
Eighteen state attorneys general have joined the lawsuit, one of which is Texas Attorney General Ken Paxton, in addition to DeFi Education Fund, a nonpartisan research and advocacy group.
Along with naming the SEC directly in the complaint, it also lists SEC Chair Gary Gensler, among other officials.
The states want the court to stop the SEC from enforcing regulations and allow them to manage digital assets with their own laws.
“The SEC’s sweeping assertion of regulatory jurisdiction is untenable,” the suit states. “The digital assets implicated here are just that — assets, not investment contracts covered by federal securities laws.”
“They do not entail any traditional investment relationship, in which the investor invests capital and the promoter assumes an ongoing obligation to use that capital in a common enterprise to generate returns that the investor will share.”
The lawsuit goes on to explain that the laws defining what counts as an “investment contract” were written in a clear way, and past U.S. Supreme Court decisions support this definition. Because of this, the complaint asserts, the SEC does not have broad authority to regulate all digital asset transactions as if they were securities. The argument is that the SEC is overreaching beyond what these laws and past rulings allow.
The complaint, filed in Kentucky district court, is asking the court to declare that digital asset transactions are not considered securities if they don’t involve a promise to manage assets for profit. They also want the court to stop the SEC from forcing digital asset platforms to register as securities-related businesses if they don’t meet those conditions. Additionally, the states claim the SEC broke rules by not following proper procedures.
Snip.
While on the campaign trail, President-elect Donald Trump vowed to protect the blockchain industry, making a bevy of promises to crypto enthusiasts.
Trump took the stage at the Libertarian National Convention back in May, where he promised to stop “Joe Biden’s crusade to crush crypto.” In July he said he would “fire Gary Gensler” on day one of his new administration.
“No longer will your government sit by and watch as Bitcoin jobs and businesses flee to other countries, because America’s laws are too unclear and too tough and too angry and too stiff,” Trump said while delivering the keynote address at a Bitcoin conference. “We will keep each and every Bitcoin job in the United States of America, that’s what we’re going to be doing.”
Texas has become a major center of the crypto and Bitcoin industry in America. Sen. Ted Cruz (R-TX) is a vocal advocate for the emerging finance sector, and Gov. Greg Abbott signaled he will continue to be friendly to the crypto community, describing himself as a “crypto law proposal supporter.”
There’s a long-running debate about just what the hell cryptocurrencies are under federal law. Unlike other securities (say, a stock or bond), a unit of cryptocurrency is not a token that represents a tangible legal entity in the real world. It’s not a currency as traditionally understood, as it is not backed by specie or the power and authority of a government. It’s not a commodity, because what commodity can be moved across the world at the speed of light?
If it doesn’t actually fit the profile of anything that legislation has specified that the government regulates, then maybe, as Paxton et al assert, then the federal government shouldn’t regulate it. That would seem to be the proper constitutional interpretation under the Tenth Amendment.
While I’m still skeptical of the long-term usefulness of cryptocurrency (though with Bitcoin hovering around $90,000, I sure wish I had mined some back when it was easier to do), the Trump Administration is filled with very smart people who believe in Bitcoin and other cryptocurrencies. History teaches us that it’s best to let new technologies shake out without government interference, so let’s hope Paxton and company’s lawsuit succeeds.
Here’s a story I’m covering just for the “What the hell?” factor.
The Tron blockchain has overtaken Bitcoin as the cryptocurrency network most favored by groups such as Hamas and Hezbollah, which are designated as terror organizations by the U.S., U.K. and other jurisdictions, Reuters reported on Monday.
There has been a sharp rise in cryptocurrency seizures from Tron wallets since 2021 and a decline in those from Bitcoin wallets, Reuters’ analysis found.
Israel has made 87 such seizures from Tron wallets this year, two-thirds of the total number going back to July 2021. These include 39 from wallets the country said in June were owned by Lebanon-based Hezbollah and 26 in July from Hamas ally Palestinian Islamic Jihad.
“Earlier it was Bitcoin and now our data shows that these terrorist organizations tend to increasingly favor Tron,” Mriganka Pattnaik, CEO of blockchain analysis firm Merkle Science, said.
The things that jump out at me are:
Evidently there’s a cryptocurrency called “Tron,” because nothing says “Cool” quite like a 41 year old Disney movie.
Hezbollah and Hamas have been using it, because financing an illegal terrorist network across international borders is one of the few use cases for the anonymous transactions that cryptocurrency currently supports. But that doesn’t seem to matter, since…
Israel was still able to seize the money, which seems to suggest that whole “anonymous, untraceable” appeal of cryptocurrency has some fairly sizeable holes in it.
Tron evidently is worth about 10 cents per coin, which seems slightly higher than the going rate for Dogecoin right now. Bitcoin is somewhere around $38,000.
How terrorist networks came to use cryptocurrency would be a really, really cyberpunk story if it weren’t so dull…
Here’s hedge fudge manager/university professor Patrick Boyle goes into detail of just how it went down.
“Silvergate’s importance in the recent crypto boom is possibly best described by a now-deleted testimonial from the bank’s website: ‘Life as a crypto firm can be divided up into before Silvergate and after Silvergate.It’s hard to overstate how much it revolutionized banking for blockchain companies.’ The testimonial was written by a millennial who still lives in his parents’ basement playing video games and has had some recent run-ins with the law. His name is Sam Bankman Fried.”
“If we go back ten years, Silvergate was a small San Diego based real estate lender that transformed itself into the go-to bank for the crypto industry.”
“Silvergate invited in crypto entrepreneurs and asked them what problems they were trying to solve and how the bank could be helpful. After this, the bank transformed itself and grew rapidly. It went public in late 2019 at a share price of $13, and a year later the stock price had risen by 1,580% as it became a key interchange point between dollars and cryptocurrencies.”
“Major Silverlake clients included Paxos, bitFlyer, Kraken and also innovators in atonal rock music – Mars Junction…” [This is an inside joke. Mars Junction is the band of Cameron & Tyler Winklevoss, AKA the WInklevoss Twins of Facebook investing controversy] “…who also had some involvement in the Crypto industry. FTX and Alameda were also big customers.”
“The bank’s growth mirrored the growth of the crypto industry, and it declined alongside that industry too, announcing in a regulatory disclosure earlier this week that it plans to wind down operations in the face of ‘turmoil in digital currency markets.'”
Last week Silvergate had announced that they would be unable to file an annual report with the SEC on time due to a weakening in their capital position. They announced that they might be forced to close at that time, blaming growing problems, in part on pending investigations into their operations. The filing confirmed that Silvergate is being investigated by the US Department of Justice.”
“Customers rushed over the last few months to pull money out of Silvergate. In January they reported that customers had withdrawn more than $8 billion, forcing them to sell held-to-maturity assets to fund the run, accruing losses on the sale of those securities of $718 million dollars.”
Why was Silvergate so important in the world of crypto? Well, people who trade cryptocurrencies often want to use dollars to buy crypto, or they want to sell crypto and receive dollars and the dollar side of those transactions is where things get bogged down. If you are transferring large sums of money to buy crypto, you need to deal with the US banking system, who might ask you a lot of questions relating to anti money laundering regulations. Crypto people hate questions like this. Similarly, if you just sold some crypto and want to deposit the dollars you received, most banks will have a long list of questions about the source of your funds, and there is a really good chance that they will simply refuse to do the transaction. It is going to be a struggle for a US regulated financial institution to show their regulator that they have done enough due diligence to be sure that your funds are not the proceeds of crime. And the last thing a bank needs is to be accused of money laundering; they would rather just simply not deal with suspicious transactions.
“For this reason, stablecoins like Tether and Terra exist – or existed.” If you weren’t paying attention, the value of theoretically stable Terra crashed hard last year.
“If you can convert your dollars into crypto once, you can then buy stablecoins that are supposed to always be worth a dollar, and then instead of buying and selling crypto, with actual dollars you buy and sell crypto with dollar-denominated stablecoins, your money can stay ‘on chain.’ The problem with that, is that you have to trust the stablecoin issuers, and they, for some reason, don’t always seem trustworthy. They won’t really tell you where the money is.”
“They’ll sometimes announce that they are going to be audited by a top 12 auditor (I’m not really sure what a top 12 auditor is – but when you hear that – you know you are getting number 12 on the list), and you start to wonder if Friehling & Horowitz made that list.” Friehling & Horowitz were Bernie Madoff’s auditors.
“If you have deposited your dollars with a crypto exchange or a stablecoin provider, they still need to deposit them somewhere. They need a bank too. Now (of course), another way of dealing with this banking issue, might be to lie to your bank about what your account is being used for (SBF and the team at FTX did that), but the technical term for ‘lying to your bank’ is Bank Fraud (as Sam Bankman-Fried just found out) – and you can get in trouble for that.”
“There was significant demand for a “crypto friendly bank” and Silvergate was willing to fill that role, when no other bank was willing to take that risk. Silvergate weren’t just crypto friendly either, they built their own payments network called the Silvergate Exchange Network to (according to their marketing documents) enable the efficient movement of U.S. dollars between participants 24 hours a day, 7 days a week, 365 days a year.”
“As you might imagine, Silvergate (being the only bank that would deal with them) attracted a lot of big crypto customers, as these customers were able to open up accounts without lying too much.”
“Silvergate dealt with most of the big players in the industry and they were an actual US regulated bank with excruciatingly detailed audited financial statements and capital regulation. This meant that your money was safe at Silvergate, unlike at the other venues we just went over.”
“The beauty of dealing with these crypto customers, crypto exchanges, [was] that because you don’t have any real competition in this space, you don’t really have to pay them any interest on their deposits. You could take the billions of dollars they deposit with you, put it all in treasuries, and you get to keep all of the interest. You’ll probably have to spend some of the profits on lawyers to keep the regulators at bay, but overall you might have a profitable business. But that’s boring right? And no one gets involved in crypto for a boring life…”
“They had a product called SEN Leverage direct lending, where they would lend people money collateralized with bitcoin. Exchanges could also borrow dollars collateralized with bitcoin for corporate treasury and other business purposes. In January, they announced that total SEN Leverage commitments were $1.1 billion dollars and that all of their SEN Leverage loans ‘continued to perform as expected, with no losses or forced liquidations.’ So, as crazy as that business might sound, it was not really the source of their problems.”
“As of September, 2022 their balance sheet showed about $11.4 billion of ‘securities,’ meaning bonds: Treasury securities, mortgage-backed securities, agency bonds and so on and $1.4 billion of ‘loans,’ meaning the Bitcoin loans and some other real-estate lending. They had $13.2 billion worth of deposits at the end of September, most of them being from crypto companies – so non-interest paying deposits, the best kind.”
“The problem for Silvergate was that when FTX was exposed as being insolvent, crypto investors were considerably less willing to leave their cash on exchanges.”
“They asked for their money back from the exchanges, meaning that the crypto companies had to ask for their money back from Silvergate, so Silvergate was faced with a good old fashioned bank run – driven not by a loss of faith in Silvergate, but by a loss of faith in crypto exchanges. By the end of December, noninterest bearing deposits at Silvergate fell from $13.2 billion dollars to just $3.9 billion dollars.” Yowzers! It’s hard to expect any bank to survive an outflow of 2/3rds of their deposits in such a short period of time.”
“There is a good chance that if you had an account at a crypto exchange, that exchange banked with Silvergate, and if you closed your account and cashed out, the cash came from a deposit at Silvergate.”
“There were other FTX related problems too. When prosecutors started looking into the collapse of FTX, their attention was drawn to their banker – Silvergate, for hosting accounts connected to Sam Bankman-Fried. Now, a big problem for Silvergate, was that – with their money all tied up in bonds or lent out, Silvergate had to come up with around 9 billion dollars to pay out these withdrawals.”
“Their accounts show that by the end of December they had sold half of their bonds and had controversially borrowed $4.3 billion from the Federal Home Loan Bank of San Francisco, a government institution that is in place to give short-term secured loans to banks that have a short-term liquidity problem.” That, and the FTX connection, attracted the attention of Washington D.C.
In September Silvergate had shown 3.1 billion dollars’ worth of bonds as being “held to maturity” and 8.3 billion dollars’ worth of bonds as being available for sale. The difference between these two classifications (from an accounting perspective) is that the available for sale bonds have to be marked to market – or held on the books at their fair market value, while the “held to maturity” bonds could be marked at their cost price. By the end of December there were no “held to maturity” bonds left on the balance sheet, meaning that they had either been sold, or reclassified as available for sale. One way or another, interest rates had gone up a lot in 2022, and these bonds were worth a lot less than they were being carried on the balance sheet at.
So they might have skated by if rising interest rates hadn’t wrecked their mark-to market.
The sale resulted in a loss of $751.4 million during the fourth quarter of 2022 and in addition, the company recorded a $134.5 million dollar impairment charge related to an estimated $1.7 billion dollars of securities it “expects to sell in the first quarter of 2023 to reduce borrowings.” This is because reclassifying some of the bonds to “available for sale” meant that they now had to be marked to market and that the loss had to be recognized under GAAP accounting rules. Silvergate also had to write down a $196 million dollar investment in “certain developed technology assets related to running a block-chain-based payment network” that it had bought in January 2022. So, all in, there was a net loss of over a billion dollars in the fourth quarter of 2022.
“Bank capital requirements are ‘risk-based’ and need to be kept above 4% to be ‘adequately capitalized’ and above 5% to be considered ‘well capitalized.’ Different types of assets have different risk weights, and this is done to keep deposits safe.”
“A bank that makes a lot of mortgage and business loans might have a capital requirement of around 8%, and assets like bitcoin have a 100% capital requirement, meaning that a bank would need to have $100 of capital for every $100 of bitcoin on its books.”
“In September Silvergate was fine, as despite the Bitcoin loans, most of their money was in high quality bonds that had zero risk weights. But when their deposits went out the door and they had to sell assets and realize a billion-dollar net loss, they were left in a situation where an additional $19 million-dollar loss would but their capital below 5% and they would no longer be considered well capitalized.”
“Last week Silvergate announced that they had sold additional debt securities in January and February to repay the company’s outstanding advances from the Federal Home Loan Bank of San Francisco and that they ‘expect to record further losses related to the other-than-temporary impairment on the securities portfolio.’ These additional losses they said would ‘negatively impact the regulatory capital ratios of the company and could result in the bank being less than well-capitalized.” And that’s when Brunhilda strode on stage to give her farewell.
“This announcement caused the stock price to half that day and according to Bloomberg caused Coinbase, Galaxy, Paxos and other crypto firms to announce that they would stop accepting or initiating payments through Silvergate. These customers leaving were the final nail in the coffin, as they reduced deposits even further.”
“A bank run, on a real bank, caused by crypto related losses and crypto volatility.”
“Matt Levine at Bloomberg argues that one way to think about the rise and fall of Silvergate is that the crypto boom was at its heart a low-interest-rate phenomenon. People started speculating in crypto because interest rates were below the rate of inflation, and so Silvergate was hugely exposed to interest-rate risk simply because of its exposure to its crypto customers.”
“Rising interest rates caused the deposits to evaporate at the same time as the assets backing those deposits fell in value. Levine argues that (with hindsight), Silvergate’s risk management – a year ago – should have been laser-focused on the risk of rising interest rates crushing both its assets and its customers, and it should have hedged that risk one way or another.”
I know all this is long and a bit detailed and technical, but I wanted to point it out as an example of how a cascading chain of events (much like the Piper Alpha disaster) caused a failure, mainly how massive fraud on the basis of one crypto space player and rising interest rates ended up bankrupting a real bank in the real world.
Sunday and Monday this week, I gathered up all my dead branches from the ice storm along the curb in advance of Tuesday’s announced neighborhood-wide branch pickup. I know it’s going to take some time, but it’s Friday and I see no signs that brush has been cleared from anyone’s curbs…
He said ESG poses a threat to the American Economy and individual economic freedom, he further said it’s an attempt for corporate’s elite to discriminate against those who do follow a particular “ideological agenda.” His proposal will outlaw this.
“By applying arbitrary ESG financial metrics that serve no one except the companies that created them, elites are circumventing the ballot box to implement a radical ideological agenda. Through this legislation, we will protect the investments of Floridians and the ability of Floridians to participate in the economy,” DeSantis said, at the news conference.
Heh. “Federal District Court Judge Orders Illinois to Show Examples of Every Newly-Banned Firearm.” (Hat tip: Instapundit.)
Maybe they should spend more time on schools instead. “Not A Single Student Can Do Math At Grade Level In 53 Illinois Schools.”
“Judy Monro-Leighton, one of three women who accused now-Justice Brett Kavanaugh of sexual assault, was found to have lied during a congressional investigation and is now being charged with making materially false statements and obstruction.”
Nicaragua’s scumbag commie government sentences Roman Catholic bishop Roland Alvarez to 26 years in prison for “treason” for daring to stand up for Catholics and refusing to be exiled.
What began as a trickle is now a flood: the US government is using the banking sector to organize a sophisticated, widespread crackdown against the crypto industry. And the administration’s efforts are no secret: they’re expressed plainly in memos, regulatory guidance, and blog posts. However, the breadth of this plan — spanning virtually every financial regulator — as well as its highly coordinated nature, has even the most steely-eyed crypto veterans nervous that crypto businesses might end up completely unbanked, stablecoins may be stranded and unable to manage flows in and out of crypto, and exchanges might be shut off from the banking system entirely. Let’s dig in.
For crypto firms, obtaining access to the onshore banking system has always been a challenge. Even today, crypto startups struggle mightily to get banks, and only a handful of boutiques serve them. This is why stablecoins like Tether found popularity early on: to facilitate fiat settlement where the rails of traditional banking were unavailable. However, in recent weeks, the intensity of efforts to ringfence the entire crypto space and isolate it from the traditional banking system have ratcheted up significantly. Specifically, the Biden administration is now executing what appears to be a coordinated plan that spans multiple agencies to discourage banks from dealing with crypto firms. It applies to both traditional banks who would serve crypto clients, and crypto-first firms aiming to get bank charters. It includes the administration itself, influential members of Congress, the Fed, the FDIC, the OCC, and the DoJ. Here’s a recap of notable events concerning banks and the policy establishment in recent weeks:
On Dec. 6, Senators Elizabeth Warren, John Kennedy, and Roger Marshall send a letter to crypto-friendly bank Silvergate, scolding them for providing services to FTX and Alameda research, and lambasting them for failing to report suspicious activities associated with those clients
On Dec. 7, Signature (among the most active banks serving crypto clients) announces its intent to halve deposits ascribed to crypto clients — in other words, they’ll give customers their money back, then shut down their accounts — drawing its crypto deposits down from $23b at peak to $10b, and to exit its stablecoin business
On Jan. 3, the Fed, the FDIC, and the OCC release a joint statement on the risks to banks engaging with crypto, not explicitly banning banks’ ability to hold crypto or deal with crypto clients, but strongly discouraging them from doing so on a “safety and soundness” basis
On Jan. 9, Metropolitan Commercial Bank (one of the few banks that serve crypto clients) announces a total shutdown of its cryptoasset-related vertical.
More at the link. I’ve long been skeptical of cryptocurrency advocates assertion that crypto provides a useful alternative to government-backed fiat currency. But it sure looks like the federal government is acting like that’s the case…
An important message about eternal truths from well-known biologist Fred Rogers:
TRIGGER WARNING. ⚠️ This is the most upsetting thing you will see all weekend. pic.twitter.com/eVLPZ3J3RI
CRT-pushing commie Angela Davis finds out that one of her ancestors was on the Mayflower.
A British farmer reviews Clarkson’s Farm. He says despite obvious setup bits, a lot of it (like the unexpected catastrophes and intractable town council bureaucracy) rings true.
The rich world was a population column from [as opposed to a pyramid] 1945 to 1992, and with the end of the Cold War, the developing world became a column in 1992 until now. The problem is that this is all temporary, because birth rate keeps dropping. People keep living older and your column eventually inverts into an open pyramid upside down. And now you no longer have children, you no longer have a replacement generation at all, and there aren’t enough people in their 20s and 30s to buy everything, and there aren’t enough people in their 40s and 50s to pay for the retirees. So this decade was always going to be the decade that most of the advanced world moves into mass retirement, and the economic model collapses, and next decade was always going to be the decade that that happened to the developing world.
“The Chinese have jumped the ship and this is their last decade, too.”
“We now know that they’ve lied about their population statistics and they’re they over counted their population by over 100 million people, all of whom would have been born since the one child policy was adopted. So this is one of those places where they’ve got more people in their 60s and their 50s and their 40s and their 30s and their 20s.”
“Mao was concerned that as the country was modernizing, the birth rate wasn’t dropping fast enough, and that the young generation was literally going to eat the country alive. So they went through a breakneck urbanization program which destroyed the birth rate, at the same time they penalized anyone who wanted to have kids, and both of those at the same time have generated the demographic collapse we’re in now.”
The male to female sex ratio in China was bad before, and now it’s obviously worse.
“Without young people, we’ve seen their labor costs increase by a factor of 14 since the year 2000, so Mexican labor is now one-third the cost of Chinese labor. Their educational system focuses on memorization over skills, so despite a trillion dollars of investment in a bottomless supply of intellectual property theft, they really haven’t advanced technologically in the last 15 years. Mexican labor is probably about twice as skilled as Chinese labor now, even though it’s one-third the cost.”
“They’ve consolidated into an ethnic-based paranoid nationalistic cult of
personality, and it’s very difficult for the XI Administration to even run it, because it’s not an administration anymore no one wants to bring Xi information on anything.”
The Biden Administration has adopted the Trump Administration’s trade policies on China.
“They now have tech barricades that prevent the Chinese from buying the equipment, the tools or the software that’s necessary to make semiconductors. In fact, [Biden] went so far as to say any Americans working in the sector have to either quit or give up their American citizenship. Every single one of them either quit or was transferred abroad within 24 hours.”
“They’re completely dependent on the U.S Navy to access international trade, they are the most vulnerable country in the world right now. And based on how things go with Russia, we’re looking at a significant amount of raw materials falling off the map, specifically food and energy, and the Chinese are the world’s largest importer of both of those things. So there’s no version of this where China comes through looking good.”
“Say what you will about the Russian economy (it’s corrupt, it’s inefficient, it’s not very high value-add), but it’s a massive producer and exporter of food and energy. You put the sanctions that are on the Russians on Beijing and you get a de-industrialization collapse and a famine that kills 500 million people in under a year.”
“Even if the Chinese were able to capture Taiwan without firing a shot, it doesn’t solve anything for them. They’re still food importers, they’re still dependent on the United States, they’re still energy importers. And even if they take every single one of those semiconductor fab facilities intact, they don’t know how to operate them, because they can’t operate their own, their own are among the worst in the world.”
“One of the fun things about Russia versus China right now is that the Russian information security is so poor that American intelligence is literally listening on everything, but in China we can hear into the office but there are no conversations happening.” I suggest taking both these revelations with a few grains of salt. Maybe Zeihan has great sources in the intelligence community, or maybe Zeihan’s great sources are lying.
Plus more on how Xi has killed or exiled any possible challenger to his power, and how they’re now having a massive Flu Manchu outbreak. “Their overall health is worse than ours, diabetes as a percentage of the population is higher, they don’t have a critical care system like we have, and their hospitals are really their only line of defense.”
Next: Why EVs are a disaster.
“All kinds of people think I’m full of shit!”
Rogan: “What is your perspective on EVS?” Zeihan: “They’re not nearly
as good on carbon as people think. Most of the data that exists doesn’t take into the fact that most of this stuff is processed in China where it’s all coal doesn’t take [into account] the fact that most grids they run out are also majority fossil fuels. And that extends the break-even time for carbon from one year to either five or ten based on what model you’re talking. Cyber trucks are far worse than EVs, but the bigger problems we’re just not going to be able to make them much longer.”
To electrify everything “We need twice as much copper and four times as much chromium and four times as much nickel and ten times as much lithium, and so on. We have never, ever, in any decade in human history, doubled the amount of a mainline material production in ten years, ever, and we need all of this by 2030. No, it’s just not technically possible.”
Zeihan says California’s mandates for phasing out gasoline by 2035 aren’t quite as bad as they seem, as the bureaucracy has the ability to move the goal posts if they prove to be unfeasible. Pardon me if I’m not sold on the beneficent rationality of California’s hard left bureaucracy.
Speaking of things I’m skeptical of:
There is a fascinating discussion happening in the environmental community right now, because they’re being confronted with reality. So California and Germany have very similar Green Tech policies, but the Germans have spent three times as much as California, but are only getting about a fifth as much power. I don’t know if you’ve ever been to Germany, but the sun doesn’t shine in Germany. And now, with the Russians on the warpath and their clean-ish energy from natural gas going away, they’re going back to lignite coal in force. It was already their number one source of power. The idea that Germany’s green is ridiculous, because they rely on really, really dirty coal, now especially. But there’s now a conversation going on between the German environmentalists and the Californian environmentalists about why California, in relative terms of doing so well at this, while Germany is not. And the answer is simple geography, but that’s never been part of the conversation in the environmental community before. Now it is. They should have had this conversation 15-20 years ago, but they’re having it now. And as soon as they come to the conclusion, unwillingly but they’ll get there, that we have to choose where we put our copper and our lithium and our nickle, EVs are not going to make the cut.
This assumes that California environmentalists are susceptible to the sweet voice of reason, and that modern environmentalism isn’t half religion and half scam. “It is difficult to get a man to understand something when his salary depends upon his not understanding it.” California’s Democratic power establishment has shown an amazing propensity to impose radical solutions that bring obvious and immediate harm to people that are not them. Why should they worry about forcing other people to buy pricey EVs when they already have theirs?
Next up: The drug war, both here and in Mexico.
Rogan starts by noting that marijuana legalization in California led to cartels planting massive amounts of weed in national forests, and suddenly guys who were game wardens are now wearing tactical gear and carrying machine guns.
“I think the mafia is a great example for why you shouldn’t look for the silver bullet [of drug legalization], because, yes, that in the 1920s during prohibition, was one of the big reasons it got going, but the mafia didn’t waste any time in diversifying and neither have the cartels.”
“They’ve gotten into cargo theft and kidnapping and avocados and limes and real estate and local government.”
“Now the attractiveness of gutting them of some of their primary income. Should we look at that? Of course! But it’s not so simple as removing one and it just all stops.”
“The challenge we’re seeing in Mexico right now is that the, uh, the air quotes “good” cartel the, one that saw drugs as a business, is being broken up. If you remember El Chapo—” Rogan: “That’s the good cartel?” Zeihan: “Sinaloa cartel, yeah. He thought of himself as a Korean conglomerate president. So it was like ‘We smuggle drugs. That’s our business. You don’t mess with things that mess with the business. You don’t trip the old lady, you don’t steal her purse, you don’t shoot at the cops. These are people who live where we operate, we want them to be on our side, so maybe even throw a party every once in a while. You focus on the business.'”
“The replacement cartel is Jalisco New Generation, They’re led by a former Mexican military officer who thinks that rather than don’t shit where you sleep so that the people on your side whenever you move into a town, you shoot it up. You do kick over the old lady, you do take her purse, you make the people scared of you, that’s the point of this. Drug running is a side gig.”
“We are here to be powerful, and drug running is just one of the ways we make that happen. And he has taken the fight to every cartel and the Mexican government, and they’re in the process of trying to break into the United States.”
“El Chapo and the Sinaloa became the largest drug trafficking organization in America under the Obama Administration. And one of the reasons our birth rate went down, so far so fast is they basically either co-opted or killed American gangs. So they killed the people who were doing the killing. Not a lot of Americans got killed after that.” I think he meant to say murder rate.
“All of the other cartels control the access points in the United States, but
Jalisco New Generation now is challenging every single one of them trying to break through. And if they do, and they bring their business acumen, if you will north of the border, they’re going to start killing white chicks named Sheila in Phoenix and then we’re gonna have a very different conversation.”
“Sinaloa they co-opted the Hispanic gangs, especially the Mexican gangs, because there wasn’t a language barrier there, and they really targeted and gutted a lot of the African-American gangs. They took over drug smuggling and distribution from them to deny them income and then they just shot a lot of people…it was pretty much completed by the time we got to 2013.”
“Look at the violent crime rates in the United States, they’ve been trending down really significantly since about 2004 and the drop from 2004 to roughly 2014 was amazing. That’s largely Sinaloa.”
And now all the cartels are fighting and the murder rate in Mexico is skyrocketing.
He’s not a fan of legalizing cocaine:
Also says that cartels are now laundering money via marijuana dispensaries using the federal reserve.
And he’s not a fan of Crypto:
Bonus: “Maxine Waters is not exactly the brightest person in congress.”
Democrats being soft on criminals, pedophiles and common sense highlights this week’s LinkSwarm.
Man, there sure seems to be a lot of funny number counting going on in Philadelphia.
Regular readers are well aware that back in July, Zero Hedge first (long before it became a running theme among so-called “macro experts”) pointed out that a gaping 1+ million job differential had opened up between the closely-watched and market-impacting, if easily gamed and manipulated, Establishment Survey and the far more accurate if volatile, Household Survey – the two core components of the monthly non-farm payrolls report.
We first described this divergence in early July, when looking at the June payrolls data, we found that the gap between the Housing and Establishment Surveys had blown out to 1.5 million starting in March when “something snapped.” We described this in “Something Snaps In The US Labor Market: Full, Part-Time Workers Plunge As Multiple Jobholders Soar.”
Since then the difference only got worse, and culminated earlier this month when the gap between the Establishment and Household surveys for the November dataset nearly doubled to a whopping 2.7 million jobs, a bifurcation which we described in “Something Is Rigged: Unexplained, Record 2.7 Million Jobs Gap Emerges In Broken Payrolls Report.”
Snip.
We bring all this up again because late on Dec 13, the Philadelphia Fed published something shocking: as part of the regional Fed’s quarterly reassessment of payrolls in the form of an “early benchmark revision of state payroll employment”, the Philly Fed confirmed what we have been saying since July, namely that US payrolls are overstated by at least 1.1 million, and likely much more!
And the correction came after the midterms! What are the odds?
The Royal Bahamas Police Force took the failed financial tech entrepreneur into custody after the U.S. filed criminal charges against him, according to a press statement. FTX, which Bankman-Fried founded, imploded in November, costing investors millions of dollars in losses. The fallen businessman has been accused of misusing customer funds deposited with FTX to artificially prop up another one of his enterprises: a crypto hedge fund, Alameda Research, which he operated simultaneously while seemingly evading financial ethics scrutiny.
Speaking of abusing children: “Former CNN Producer Pleads Guilty In Pedo Scandal. Former CNN producer John Griffin, who worked ‘shoulder to shoulder’ with Chris Cuomo, pleaded guilty on Monday in federal court to using interstate commerce to entice and coerce a 9-year-old girl to engage in sexual activity as his Vermont ski house. This is a different CNN pedophile than Jake Tapper’s former producer, Rick Saleeby, who resigned after it emerged that he solicited sexually explicit photos of an underage girl.”
The mother of an 11-year-old rape victim is suing a George-Soros backed prosecutor in Virginia who let the boy’s rapist walk free, alleging the prosecutor’s actions violated the minor’s civil rights and made him fear for his physical safety.
Amber Reel in November filed the federal lawsuit on behalf of her son after Fairfax County commonwealth’s attorney Steve Descano (D.) let the rapist walk. Court filings show Descano was months late in sharing necessary evidence before a September trial, dooming the case and forcing his office to enter into a lesser plea deal with the rapist the same month. Ronnie Reel, who was released on time served, had faced life in prison for forcibly sodomizing the minor. Reel is the victim’s uncle.
This is the second high-profile case in the last month where the Soros prosecutor freed a dangerous offender. In December, Descano struck a plea deal that would clear the record of a man who fired his gun into a crowded Virginia bar. Soros donated more than half a million dollars to Descano’s 2019 campaign.
A grand jury had already indicted Reel in February for sodomy and aggravated sexual battery, and the case was set for trial in September. But Descano’s office didn’t share evidence with the public defender before trial, bungling Reel’s prosecution with its “woefully, woefully missed” deadlines. The case’s presiding judge said Descano’s office did a “disservice to the victim” and was “very concerning to the court.”
Because he dodged a felony sex crime conviction, Reel won’t have to register as a sex offender and won’t be barred from holding jobs in schools or other places that would put him near children. The victim and his mother in their suit say Descano’s “deliberate indifference represents egregious conduct that is shocking to the conscience.”
Speaking of pedophile friendly Democrats: “During the hearing before the House Oversight and Reform Committee, California [Democratic] Rep. Katie Porter asserted that the phrase “groomer” is a “lie” used to maliciously discriminate against LGBTQ+ people and make them appear to be a “threat.” “You know, this allegation of ‘groomer’ and ‘pedophile,’ it is alleging that a person is criminal somehow and engaged in criminal acts merely because of their gender identity, their sexual orientation, their gender identity.” Yes, if your “gender identity” is “I like to have sex with children,” then yes, you’re a pedophile, and if you tell elementary school children what sort of sex you have, then yes, you’re a groomer.
Former state Sen. Kirk Watson (D-Austin) will be the next mayor of Austin about two decades after he left that same office in the early aughts.
He defeated state Rep. Celia Israel (D-Austin) by a slim margin after finishing second in the general election. He’ll serve as mayor for the next two years before having to seek re-election in 2024 due to redistricting.
Watson lost Travis County, the city’s largest portion, by 17 votes while winning Williamson county by 881 and Hays County by 22. During the general and runoff races, he outspent Israel by a wide margin.
The two candidates sparred over housing and homeless policy during the general election and the runoff. About one-third of the voting population turned out to vote in the runoff versus the November 8 general.
Watson will take over for Mayor Steve Adler after his self-described “disruptive” tenure marked by a lingering homelessness problem, public fallout and a declining relationship with the police department, and a cumbersome and increasingly costly light rail transit project.
The United States has always had kind of a friends and family plan that it sells military gear to, but it has always reserved the very top top top stuff for itself and the Brits. Well, in this calendar year we have already seen the first two exceptions to that policy being made. The United States is sending air-launch cruise missiles and nuclear-powered submarines to the Australians. And now we’re giving Tomahawks to the Japanese, giving both of these countries the ability to independently destroy China’s economic links to the wider world without any additional help from the United States. And this sudden proliferation of countries that can now bring China to their knees independently, this is arguably the biggest strategic development of the Year, even more so than the Ukraine war, because it takes what has become the world’s second largest economy and puts it completely at the mercy of the domestic politics of a third party, and now a fourth party.
Oberlin College finally pays their judgment to Gibson’s Bakery. “The $25 million verdict plus interest and attorney’s fees resulted in an almost $32 million judgment, with interest running at about $4000 per day since June 2019. In all, over $36 million was owed.” Cudos to William A. Jacobson at Legal Insurrection for his thorough, ongoing coverage of this story from beginning to end.
F-35B fighter crashes in the Metroplex. Fortunately the pilot safely ejected, and it appears that the airplane (which was undergoing testing for Lockheed) looks recoverable. To my untrained eye it looks like a stuck throttle.
Let me start out by explaining how cryptocurrency works: You exchange your money for digital strings of numbers based on math you don’t understand, for one of the following reasons:
A. You believe those digital strings of numbers will be worth more money at some point in the future.
B. You want to buy drugs online in a theoretically untraceable manner (said theoretical untraceability being a key property of the math you don’t understand).
C. You want to place your money beyond the reach of your national government.
There are exceptions to the above (say, you’re mining your own cryptocurrency, or you know enough math to understand exactly the mathematical properties of how blockchain-based cryptocurrency works), but I’m going to guess that one of the three above use cases apply to 95% people using cryptocurrency.
I’m somewhat sympathetic to C, and even understand how A might be tempting (hey, crypto has dropped so much I might buy a couple thousand worth of Dogecoin, just for the hell of it, as a pure speculation play), but cryptocurrencies as a whole are not a proven store of worth on par with, say, a bar of gold, a share Apple stock, or a
Is cryptocurrency money? Sort of.
Cryptocurrency offers something that sometimes acts like money, offers anonymity like money, and offers an alternative to government-backed fiat currencies. Instead of being backed by the full faith and credit of the federal government, cryptocurrency is backed by the full faith of millions of technologically savvy individuals who believe the math is sound.
The math may indeed be sound, but that didn’t save it from the loss of investor confidence of the Crypto Winter we’re now experiencing. And that winter is absolutely slamming the business models of people who sought to make crypto more like other forms of money.
Enter Sam Bankman-Fried and FTX, whose crypto empire just collapsed.
Amid all the jubilation and gloating by Joe Biden, Chuck Schumer and pals over the Democrats’ better-than-expected showing in the midterms comes a disturbing story that may explain something about how they won such a curious election.
Biden’s second-biggest donor, cryptocurrency billionaire wunderkind Sam Bankman-Fried, a k a SBF, saw his business file for bankruptcy days after the election, but not before pumping $40 million into the Democratic Party to spend on “get-out-the-vote” and other shadowy ballot-harvesting mechanics for the midterms.
The shambolic 30-year-old whiz kid, once said to have been worth $16 billion, had spent $10 million helping get Biden elected in 2020.
SBF’s mother, Stanford law professor Barbara Fried, also is co-founder of left-wing political action committee Mind The Gap, which has raised a reported $140 million to help Democrats win elections through the same “get-out-the-vote” grift.
Tree. Acorn. Distances.
A more unlikely billionaire you could not find — and of course his money was built on thin air. A math genius with poor social skills, SBF reportedly lived in a “polycule” — a polyamorous relationship with multiple people — in a luxury penthouse with about 10 co-workers in the tax haven of the Bahamas, where his collapsed crypto exchange FTX was headquartered.
Otherwise, he was sleeping on beanbags in his office, eating vegan fries and, according to his own Twitter feed, popping amphetamines and sleeping pills to regulate his chaotic sleeping habits.
Just the sort of person you want to entrust billions in currency to!
Now Reuters is reporting that between $1 billion and $2 billion of customer funds have vanished from FTX, conveniently after the Democrats safely spent his money.
At last report, SBF and his mysterious co-founder, Gary Wang, were being held “under supervision” by Bahamian authorities after reportedly planning to flee to Dubai, according to fintech publication Cointelegraph.
It is a stunning fall to earth. The financial media and big investors have feted the young billionaire as a saint who shunned earthly pleasures like Lamborghinis and Rolexes, but lived only to give away all his money and make the world a better place.
He was the most famous millennial adherent of a cult known as “Effective Altruism,” which originated at Oxford University, found fertile ground in Silicon Valley — and now has gone down in flames along with him.
“Indulgences! Buy your Social Justice Indulgences here!”
EA is a disguised form of socialism, because all the “good” that is done just happens to match up perfectly with the left’s obsessions, whether climate change, social justice, equity, banning meat or his favorite, “pandemic preparedness.”
In a Nas Daily online video, an awkward Bankman-Fried was featured this year as a role model of altruism for young people: “Sam is not a traditional billionaire because he believes in the concept of ‘earn to give’ … Next decade he will probably give away more than $10 million … He wants to get rich in order to impact the world and change it.”
Some detail snipped.
The sinister neo-socialists at the World Economic Forum (WEF) loved SBF so much, they made FTX a “corporate partner” — but that page on the WEF website has vanished in the last 48 hours, leaving an error message.
Venture capital firm Sequoia was a big backer, investing over $200 million in SBF, a lot of which he then invested back in Sequoia, whose chairman and managing partner Michael Moritz is a big donor to the Dems as well as to anti-Trump hate group the Lincoln Project, and reportedly is a neighbor of Nancy Pelosi in San Francisco.
Justin Trudeau, the prick that keeps pricking, has decided that the risk of him looking impotent is such an astounding threat to the nation that it requires invoking the never-before-used Emergencies Act to end the vaccine mandate protests.
The Emergencies Act gives powers to the federal government:
the ability to “regulate or prohibit public assembly that may reasonably be expected to lead to a breach of the peace, travel, or the use of property”
the ability to “designate and secure protected places”
the ability to “assume the control, restoration and maintenance of public utilities and services”
the ability to “authorize or direct the provision of essential services and the provision of reasonable compensation”
the ability to “impose on summary conviction a fine not exceeding $500 or imprisonment not exceeding six months or both, or on indictment, a fine not exceeding $5,000 or imprisonment not exceeding five years, or both, for any breach of an order or regulation”
Trudeau has to meet with his provincial cabinet. Then he will release a proclamation.
As soon as Trudeau invokes the Emergencies Act it will go into effect. However, Parliament must receive a motion for the emergency within seven days.
The motion for the emergency must survive the House of Commons and the Senate. If it does not then it will end.
Canada Deputy Prime Minister and Minister for Finance Chrystia Freeland has announced the government is broadening the scope of the country’s anti-money laundering monitoring and terrorist financing laws to cover crowdfunding platforms and the payment service providers they use.
“These changes cover all forms of transactions, including digital assets such as crypto currencies,” she announced during a press conference on Monday night.
“The illegal blockades have highlighted the fact that crowdfunding platforms and some of the payment service providers they use are not fully captured under the proceeds of crime and terrorist financing act.
“Our banks and financial institutions are already obligated to report the Financial Transactions and Reports Analysis Centre of Canada or FINTRAC. As of today, all crowdfunding platforms and the payment service providers they use must register with FINTRAC, and they must report large and suspicious transactions to FINTRAC.”
How quickly government power went from “We’re only taking money from druglords and terrorists” to “We’re tracking all transactions of peaceful protestors.” Imagine if the U.S. government announced it was going to freeze the bank accounts and impound the cars of everyone marching in Selma. That’s what’s going on in Canada.
All over a vaccine mandate that was never enacted into law by Canada’s parliament.
It may be time for all Canadians, not just those involved in the protest, to get their money out of Canada.
4chan is calling for a run on Canadian banks in response to Trudeau’s crackdowns
The Emergencies Act can only be invoked when a situation "seriously threatens the ability of the Government of Canada to preserve the sovereignty, security and territorial integrity of Canada" & when the situation "cannot be effectively dealt with under any other law of Canada."
— Canadian Civil Liberties Association (@cancivlib) February 15, 2022
Governments regularly deal with difficult situations, and do so using powers granted to them by democratically elected representatives. Emergency legislation should not be normalized. It threatens our democracy and our civil liberties. #cdnpoli
— Canadian Civil Liberties Association (@cancivlib) February 15, 2022
A few more tweets:
It went from "small fringe minority" to "Holy shit I need absolute power to quell these huge protests" pretty damn quick.
