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Microsoft Slides After Amending OpenAI Partnership, Will No Longer Pay Revenue Share

Microsoft and OpenAI announced an amended agreement to "simplify" their partnership structure and to change Microsoft’s license to be non-exclusive and it no longer paying a revenue share to OpenAI.

As a result of the amendment, Microsoft remains OpenAI’s primary cloud partner, and OpenAI products will ship first on Azure. Microsoft will continue to have a license to OpenAI IP for models and products through 2032. Revenue share payments from OpenAI to Microsoft continue through 2030. Microsoft will also continue to participate directly in OpenAI’s growth as a major shareholder.

Here is the brief press release: 

The rapid pace of innovation requires us to continue to evolve our partnership to benefit our customers and both companies. Today, we are announcing an amended agreement to simplify our partnership and the way we work together, grounded in flexibility, certainty and a focus on delivering the benefits of AI broadly. The greater predictability in the amended agreement strengthens our joint ability to build and operate AI platforms at scale while providing both companies the flexibility to pursue new opportunities. The agreement spells out:   

• Microsoft remains OpenAI’s primary cloud partner, and OpenAI products will ship first on Azure, unless Microsoft cannot and chooses not to support the necessary capabilities. OpenAI can now serve all its products to customers across any cloud provider. 

• Microsoft will continue to have a license to OpenAI IP for models and products through 2032. Microsoft’s license will now be non-exclusive.  

• Microsoft will no longer pay a revenue share to OpenAI. 

• Revenue share payments from OpenAI to Microsoft continue through 2030, independent of OpenAI’s technology progress, at the same percentage but subject to a total cap.  

• Microsoft continues to participate directly in OpenAI’s growth as a major shareholder.  

While this amendment simplifies the partnership, the work we’re doing together remains ambitious. From scaling gigawatts of new datacenter capacity, to collaborating on next-generation silicon, to applying AI to advance cybersecurity, and more, we’re excited to keep partnering to advance and scale AI for people and organizations around the world.

The news spooked MSFT stock, which briefly tumbled just shy of $400, its lowest price in 10 days, before recovering much of the drop.

Tyler Durden Mon, 04/27/2026 - 09:21

Musk, Altman Court Battle Commences Over The Future Of OpenAI

Authored by Beige Luciano-Adams via The Epoch Times,

A contentious battle years in the making between Tesla owner Elon Musk and OpenAI CEO Sam Altman begins this week before a federal court in Oakland, California, where nine jurors will be asked to decide whether Altman and others betrayed OpenAI’s founding mission as a nonprofit artificial intelligence (AI) lab dedicated to the public good.

The outcome could have a profound impact, not just for OpenAI—the creator of ChatGPT, currently valued at $852 billion and poised for a public offering—but for the broader, dizzyingly high-stakes race to advance AI technology and dominate the commercial market.

Musk, who cofounded OpenAI in 2015 and served as an early investor, sued cofounders Altman and Greg Brockman, alleging that they bilked him out of tens of millions of dollars with the false promise that the project would remain an open-source nonprofit—and act as a safety hatch on the “grave threat” posed by profit-driven advancement of artificial general intelligence (AGI).

AGI is generally understood as the hypothetical point at which AI reaches or surpasses human cognitive abilities and can operate autonomously, which many experts warn poses an existential threat to humanity.

Musk claims that Altman and Brockman secretly planned to convert to a for-profit corporation with backing from Microsoft, a major investor to which OpenAI exclusively licensed its flagship product.

“Mr. Altman caused OpenAI to radically depart from its original mission and historical practice of making its technology and knowledge available to the public,” Musk alleged in the lawsuit.

“Altman set the bait and hooked Musk with sham altruism then flipped the script as the non-profit’s technology approached AGI and profits neared,” the lawsuit claims.

OpenAI counters that Musk agreed that a for-profit structure would be necessary to raise sufficient capital but walked away when other founders disagreed that he should be the one to lead it.

“Motivated by jealousy, regret for walking away from OpenAI and a desire to derail a competing AI company, Elon has spent years harassing OpenAI through baseless lawsuits and public attacks,” the company wrote on the OpenAI website in a running commentary on the feud.

A Troubled History

In 2023, OpenAI’s board fired Altman, saying that it had lost confidence in him after he was “not consistently candid.” Musk alleges that his reinstatement days later, after a majority of board members resigned, was orchestrated by Microsoft.

In its response to the suit’s claims that it engaged in anticompetitive behavior with OpenAI, Microsoft argued that Musk’s “evidence-free” antitrust claims “make no sense.”

The same year, Musk founded xAI and launched Grok to compete with OpenAI’s ChatGPT. In February 2025, he led a hostile, unsuccessful bid to acquire OpenAI’s assets for $97.4 billion—which, according to OpenAI’s counterclaims, was a “sham bid” meant to disrupt the company’s fundraising and planned reorganization.

The trial follows years of increasingly heated sparring on X and in the press over the former partners’ acrimonious split and ensuing competition.

It also comes at a time when Altman’s leadership has come under scrutiny following the dissolution of two OpenAI safety teams, as well as claims that he deceived executives and board members about safety protocols and exhibited a “consistent pattern of lying,” detailed in internal communications by Ilya Sutskever, the company’s chief scientist, in 2023 and more recently in a New Yorker article.

“Over the past years, safety culture and processes have taken a backseat to shiny products,” Jan Leike, a former safety leader at the company, wrote in a 2024 post on X announcing his departure.

OpenAI created a for-profit subsidiary in 2019; as part of a 2025 restructuring, it moved its intellectual property and employees to the for-profit venture. The OpenAI Foundation, its nonprofit arm, retains a 26 percent stake and “continues to control” the corporation, according to OpenAI.

Microsoft maintains a 27 percent stake in the corporation.

Musk is asking that OpenAI be reverted to a nonprofit, that more than $100 billion in damages be returned to it, and that Altman and Brockman be removed from their leadership roles.

Internal Documents

At the time of OpenAI’s founding in 2015, according to Musk’s lawsuit, Altman expressed grave concerns that superhuman machine intelligence posed the “greatest threat to the continued existence of humanity.”

The two agreed to build a lab that could compete with Google, then the most powerful contender in the field, but that would be entirely open-source and philanthropic, functioning as a safeguard against profit-driven AGI.

In 2017, Brockman, Altman, and Sutskever considered a shift to for-profit status necessary to achieve AGI; Musk suggested keeping the project nonprofit but attaching it to Tesla as its “cash cow.”

Internal communications from that time, revealed in court documents, offer insight into arguments both sides intend to make about the contested timeline surrounding a decision to restructure as a for-profit corporation.

OpenAI alleges that Musk’s inability to recall critical discussions about the future of the company in 2017 may be due to the use of recreational drugs at Burning Man, and that his relationship with former board member Shivon Zilis functioned as a secret liaison to the company, including while the board approved Microsoft investments Musk now claims violate OpenAI’s charitable trust.

Meanwhile, Musk alleges that Brockman’s private digital journals show that Brockman and Altman conspired to deceive him about the direction of the company, even as they continued to accept his funding.

Responding to an ultimatum from Musk, Altman said he remained “enthusiastic” about the nonprofit structure.

Subsequently, Brockman wrote in his journal that the turn to for-profit status would likely include “a very nasty fight,” that Sutskever considered it immoral to kick Musk out, and that Musk’s story “will correctly be“ that Brockman and Altman ”weren’t honest with him in the end about still wanting to do the for profit just without him,” according to court documents.

In another entry included in court documents, Brockman said: “It’d be wrong to steal the non-profit from him. To convert to a b-corp without him. That’d be pretty morally bankrupt. And he’s really not an idiot.”

Judge Yvonne Gonzalez Rodgers of the U.S. District Court for the Northern District of California cited Brockman’s notes—which she said could be read as intended to deceive—in her Jan. 15 ruling denying OpenAI’s motion for summary judgment.

In a Jan. 16 post on X, Brockman suggested that Musk “cherry-picked” from his personal journal.

“Elon and we had agreed a for-profit was the next step for OpenAI’s mission,“ Brockman said. ”The context shows these snippets were actually about whether to accept Elon’s draconian terms.”

Artificial General Intelligence

In 2023, Musk joined more than 1,000 researchers and tech leaders in an open letter calling for a six-month moratorium on the development of systems more powerful than ChatGPT-4. Altman largely dismissed the letter as “missing most technical nuance” and “not the optimal way” to address safety issues.

Part of Musk’s claims center around the idea that Generative Pre-Trained Transformer (GPT-4) has already achieved an early version of AGI.

“It is better at reasoning than average humans,” he notes in the lawsuit.

Microsoft researchers in a 2023 paper reported that GPT-4 can solve novel and difficult tasks across a range of disciplines with performance “strikingly close to human level,” and could “reasonably be viewed as an early (yet still incomplete) version of an ... AGI system.”

OpenAI defines AGI as the point at which AI will “outperform humans at most economically valuable work.”

In an April 22 podcast, Altman and Brockman said they viewed the trial as an opportunity to tell their side of the story.

“I think it’s insane that he’s doing this,” Altman said of Musk. “But I am happy that we get to explain all this to the world and have this chapter behind us.”

Addressing questions of safety and human flourishing, Altman said OpenAI is increasingly focused on “iterative deployment,” which he described as “figuring out how to deploy products that get increasingly safe as the stakes go up.”

As the threshold of AGI approaches, the promise made by Altman—that the technology will create unprecedented wealth, cure disease, and benefit all of humanity—appears distant, especially for tech workers.

Meta last week announced that it was laying off about 8,000 employees, or about 10 percent of its global workforce, and closing another 6,000 positions, as it invests heavily in AI. In order to train AI systems, the company plans to deploy software to track employee mouse movements and keyboard clicks, according to reporting from Reuters.

Other major tech companies, including Microsoft and Amazon, have recently announced layoffs in the wake of increased AI investment.

So far this year, more than 92,000 tech workers have been laid off, according to the tracker site Layoffs.fyi.

Jury selection in the Oakland trial begins on April 27.

Tyler Durden Mon, 04/27/2026 - 09:20

"This Is Not Normal": China's DeepSeek Cuts New AI Model Fees, Again

DeepSeek senior researcher Victor Chen announced on X that the company's newly released DeepSeek-V4-Pro model will be offered at a huge discount over the next week, a move that threatens to unleash an AI platform price war just as Anthropic, OpenAI, and Google are rolling out newer, more expensive models.

"Second price drop in two days! On top of the base 75% off, stack an extra 90% discount for cache hits. That brings it down to just 0.003625 USD/0.025 RMB per 1M input tokens with cache hit ~ 🎉💰 Go wild and have fun ~," Chen wrote in a post on X late Sunday night.

He added, "Just a heads-up: the cache discount is permanent, while the base 75% off promo runs until May 5, so make the most of it while you can!"

Second price drop in two days! On top of the base 75% off, stack an extra 90% discount for cache hits — that brings it down to just 0.003625USA/0.025 RMB per 1M input tokens with cache hit~ 🎉💰 Go wild and have fun~ 🚀

📌 Just a heads-up: the cache discount is permanent, while… https://t.co/izR7GfyhQf

— Deli Chen (@victor207755822) April 26, 2026

The long-awaited V4 model was released at the end of last week, ending months of silence from one of China's most closely watched AI labs and arriving a year after its R1 release sparked U.S. equity market turmoil.

The open-source model comes in the V4 Flash and V4 Pro series, with DeepSeek saying its V4 "leads all current open models, trailing only Gemini-3.1-Pro."

DeepSeek-V4-Pro

🔹 Enhanced Agentic Capabilities: Open-source SOTA in Agentic Coding benchmarks.
🔹 Rich World Knowledge: Leads all current open models, trailing only Gemini-3.1-Pro.
🔹 World-Class Reasoning: Beats all current open models in Math/STEM/Coding, rivaling top… pic.twitter.com/D04x5RjE3L

— DeepSeek (@deepseek_ai) April 24, 2026

DeepSeek's hefty discount is aimed at luring developers, startups, and enterprise users away from expensive U.S. models like those from OpenAI, Anthropic, and Google by offering lower prices, easier access, open-source availability, and a 1-million-token context window.

X user thehype pointed out that the Chinese AI lab's discount "is starting a price war in the AI market," adding:

they just slashed input cache prices to 1/10th of what they already were.

and there's a separate 75% off promo on v4-pro running until may 5th.

but even ignoring the sales – the normal api prices tell the story. output per 1M tokens (real weighted avg, no discounts):

• gpt-5.5: $30.21
• claude opus 4.7: $25.00
• deepseek v4-pro: $1.73

that's ~17x cheaper than gpt-5.5 and ~14x cheaper than opus 4.7.

now add the 75% promo: deepseek output drops to $0.87/M. that's 35x cheaper than gpt-5.5 and 29x cheaper than opus 4.7.

and the benchmarks? v4-pro isn't that far behind. artificial analysis intelligence index:

• gpt-5.5: 60
• claude opus 4.7: 57
• deepseek v4-pro: 52

13% lower score. 35x lower price.

after releasing v4 on open weights (mit license, free to self-host), deepseek is now aggressively competing on cloud api pricing too. own both ends of the market.

it's a dangerous game. when a model is 87% as capable at 6% of the cost, "we're better" stops being a pitch

ai is starting to commodify. the price war has begun.

deepseek is starting a price war on the ai market ⚔️

they just slashed input cache prices to 1/10th of what they already were. and there's a separate 75% off promo on v4-pro running until may 5th.

but even ignoring the sales – the normal api prices tell the story. output per 1M… https://t.co/cOL7Qzh3jq pic.twitter.com/F0hyoxkfN3

— thehype. (@thehypedotnews) April 26, 2026

Another X user asked what DeepSeek's actual motive is behind the price drop:

This is not normal. Every AI company is out here chasing profits… so why does DeepSeek keep dropping prices this hard (cache hits to 1/10th + 75% off) when their output is already frontier-level?

I get it’s a killer deal and beats most competitors on value, but what’s the…

— Sage Aurélius (@sageaurelius) April 26, 2026

AI price war it is.

Tyler Durden Mon, 04/27/2026 - 09:05

Futures Flat At All Time Highs Ahead Of Huge Week, Semis Set For 19th Day Of Gains

Risk sentiment improved overnight on another Axios report that Iran has given the US a new proposal to reopen the Strait of Hormuz with more detailed nuclear talks expected later. Oil pares early gains, and US equity futures jumped although they have also pared gains since and are trading flat as traders await a huge week of earnings (44% of the S&P by mkt cap is set to report) and central bank decisions (Fed, BOJ, ECB, BOE and BOC all expected to keep rates on hold). As of 8:00am ET, S&P 500 futures are flat and Nasdaq 100 contracts gain 0.2% after Friday's records for both indexes even though leadership is narrow, and the S&P equal weight index closed negative on the week; premarket gains by chip stocks like Nvidia, Qualcomm, Intel and Micron suggest the semiconductor ETF (SOX) is set for a record 19th day of gains. Mag7s are mixed, semis are bid, discretionary outperforms staples, cyclicals over defensives, and AI theme is bid across multiple sectors. Looming Big Tech results (22% of S&P 500 market cap across just four companies reports after the close on Wednesday, when Alphabet, Microsoft, Amazon and Meta release their Q1 results with Apple following on Thursday) will test whether April’s rally is sustainable, with signs of caution under the surface of the gains.  Bond yields are +1-2bps as the yield curve steepens; DXY is lower. Commodities are bid led by the Energy complex, with most products up at least 2%. Brent crude rose 1.1% to about $106.50 a barrel after Trump canceled a trip by top envoys to mediators in Pakistan over the weekend. Base metals are leading Precious with Ags continuing its march higher. Today’s macro data calendar is light ahead of a heavy central bank schedule where major CBs are expected to hold ahead of the market pricing changes in June. Warsh is set to be confirmed without further delays while Powell’s status remains unclear. 

In premarket trading, Mag 7 stocks are mixed (Nvidia +1.6%, Alphabet +0.4%, Amazon -0.1%, Meta +0.04%, Microsoft -0.4%, Tesla -0.4%, Apple -1.8%)

• Domino’s Pizza (DPZ) falls 3% after the company reported revenue for the first quarter that missed the average analyst estimate.
• GE Vernova (GEV) is down 1.6% after BNP Paribas downgraded the power equipment company to neutral, predicting it would find it harder to sustain growth momentum, given that 90% of gas turbine capacity is already contracted through 2030.
• Intellia Therapeutics (NTLA) rises 1.6% after saying its gene-editing treatment for a rare swelling disorder met its goal in a late-stage trial, paving the way for the potential first approval of a new way of modifying DNA.
• Organon & Co. (OGN) gains 16% as Sun Pharmaceutical Industries Ltd. has lined up a short-term loan to help finance its $12 billion acquisition of the New York-listed healthcare company, according to people familiar with the transaction.
• Oruka Therapeutics (ORKA) climbs 15% after announcing positive topline results from a Phase 3 clinical trial of lonvo-z in hereditary angioedema.
• Qualcomm (QCOM) jumps 13% after TF International Securities analyst Ming-Chi Kuo said industry checks suggest OpenAI is working with the chipmaker and Taiwan’s MediaTek to develop smartphone processors.
• VeraDermics (MANE) climbs 15% after saying its oral extended-release minoxidil formulation VDPHL01 met all primary and key secondary endpoints with high statistical significance in a Phase 2/3 clinical trial for male pattern hair loss.
• Verizon (VZ) gains 3% after the company boosted its adjusted earnings per share guidance for the full year.
• XOMA Royalty Corp. (XOMA) shares are halted after Ligand Pharmaceuticals agreed to buy the company for $39 per share of common stock in cash

In other corporate news, Musk says he’s nearing his goal of turning X into an “everything app” with a new financial services tool called X Money, which is expected to launch for the public this month. China has decided to block Meta’s $2 billion acquisition of agentic AI startup Manus, making a surprise move to unwind a controversial deal.

The S&P 500 is up nearly 10% this month following an unprecedented but increasingly narrow rally thanks to chipmakers and robust earnings, helping the benchmark recoup all losses after the war in the Middle East upended energy flows. Chip stocks are set for further gains on Monday, with names such as Qualcomm Inc., Intel Corp. and Micron Technology Inc. rising in premarket trading. Nasdaq 100 futures climbed 0.2%.

While Friday witnessed new records for the S&P 500 and Nasdaq 100, hegde funds are selling tech stocks, leadership is extremely narrow, and the S&P equal weight index closed negative on the week

Systematic strategies have bought stocks aggressively, but some investors have less conviction. Hedge funds are using the US equity rally to reduce risks, according to traders on Goldman's prime brokerage desk, who point out significant degrossing and selling to tech stocks.

Some Wall Street strategists say it may be a good time to buy insurance via options, such as pure stock hedges or broader protection against higher interest rates. Morgan Stanley strategist Michael Wilson, meanwhile, expects any potential pullbacks to be shallow given passive investors are still under-risked.

The signs of caution come as traffic through the Strait of Hormuz remains at a near-complete halt, pushing WTI back above $96. Goldman Sachs analysts lifted their oil-price forecasts again, saying that an estimated 14.5 million barrels a day of Persian Gulf crude production losses are driving global oil inventories to draw at a record pace. 

“Even if we do get a deal, oil is not going back to pre-war levels,” wrote Mohit Kumar, chief economist and strategist for Europe at Jefferies. “We need to factor in some degree of stagflationary impact. The US should be the least impacted, South Asia the most impacted, while Europe should be somewhere in between.”

Yet markets remain largely unfazed by continued oil price increases; for them the AI narrative takes precedence. Traders continue to chase the theme through the semiconductor complex, pushing the SOX Index to its most overbought level in 15 years. The SOX has also completely dislocated from the ISM Manufacturing reading. That gap historically tends to close one way or another.

It's an extremely busy weeks for earnings with over 42% of the S&P set to report Q1 results.  Earnings from Alphabet, Microsoft, Amazon.com, Meta and Apple make this a make-or-break week for the rally. The companies are worth nearly $16 trillion combined, representing a quarter of the S&P 500’s market capitalization. Expanding profits have helped keep a lid on valuations, with the Mag-7 ex-Tesla trading at a P/E of 25x, down from 29x in October. 22% of S&P 500 market capitalisation, across just four companies, reports after the close on Wednesday, when Alphabet, Microsoft, Amazon and Meta release their Q1 results. Apple follows on Thursday.

Of the 139 S&P 500 companies to have reported so far this earnings season, 80% have beaten analysts’ forecasts, while 14% have missed. 

We also get a bonanza of central bank announcements (Fed, BOJ, ECB, BOE, BOC) this week. Policymakers in the US and across the G7 will probably keep rates steady this week while watching the impact of higher energy costs. Wednesday will see the Federal Reserve deliver its latest interest-rate decision, with central bank officials across the Group of Seven also meeting during the week as investors eye how policymakers confront the risk of a war-driven inflation shock. As for Wednesday’s Fed policy meeting, any meaningful change in guidance will likely be deferred until June, wrote Jim Reid, head of macro research and thematic strategy at Deutsche Bank AG. 

“That said, there is a tangible risk that communication skews modestly hawkish,” Reid said. “An explicit acknowledgment that risks to price stability and employment are now more evenly balanced would likely be interpreted as a marginally less accommodative stance.”

In another keenly anticipated event this week, a Senate Banking Committee vote on Kevin Warsh’s nomination as chair of the Federal Reserve is scheduled for Wednesday. Warsh is expected to be swiftly confirmed as Jerome Powell’s successor, whose term ends on May 15, after Republican Senator Thom Tillis said he’s dropping his blockade of the nomination he said in an NBC interview. The DOJ’s decision to drop a criminal probe into the Fed may clear a path for Trump’s nominee to take over, but it won’t secure the current Fed chair’s departure. At his confirmation hearing last week, Warsh called for a “regime change” in the way the Fed conducts policy. Money markets are currently leaning against any Fed rate cut in 2026.

“Markets are looking for a new narrative and are jumping back to the AI boom for now,” said Joachim Klement, head of strategy at Panmure Liberum. “However, most investors seem to be guided by uncertainty and are still assessing the fallout from the Iran war. This could mean that a new macro story will emerge soon.”

In politics, Trump is using the Saturday night shooting at the White House Correspondents’ Dinner to add a security rationale to his case for building a massive White House ballroom. Budget airlines are asking the White House for a relief plan worth $2.5 billion in exchange for convertible equity stakes in the carriers.

European stocks rise, with the Stoxx 600 up 0.3% after erasing an earlier fall. Energy, industrial and bank names are leading gains.Energy and retail sectors outperform. Sainsbury falls after a double-downgrade from Goldman. Here are some of the biggest movers on Monday:

• Nordex surges as much as 15% after the renewable-energy equipment firm beat expectations in the first quarter of the year.
• Commerzbank rises as much as 2.2% as Bank of America upgrades its shares to buy, saying they look attractive whether the bank is bought by Unicredit or not.
• Whitbread shares gain as much as 3.6% after a report from the Times over the weekend said the company plans sell a swathe of Premier Inn hotels to unlock £1.5 billion.
• Kingfisher shares rise as much as 1.1% after the DIY retailer was upgraded at Barclays following its recent underperformance against European peers.
• Orsted shares rise as much as 3.9% as Goldman Sachs upgrades its rating on the offshore energy company to buy from neutral.
• Entain shares fall as much as 7.1% in heavy trading volume after news that one of the gaming company’s major shareholders, Eminence Capital, is being shuttered.
• Sainsbury drops as much as 4.8% as Goldman double-downgrades to sell on macro headwinds, and Citi lowers its rating on the UK supermarket chain to neutral on weaker than expected Ebit guidance for 2027.
• Nexi shares fall as much as 3% after Bank of America downgrades the Italian payments processor to underperform from neutral, citing unjustified recent outperformance amid ongoing growth headwinds from bank contract losses and risks to 2028 targets.
• Intertek shares drop as much as 3.9% after the testing and certification firm said after markets closed on Friday that it rejected the 5,400 pence per share bid from EQT, stating it “fundamentally undervalues” the company and its prospects.
• Seraphim Space Investment Trust shares fall as much as 16% in London trading after it announced plans to raise funds by issuing shares.

Asian equities also push higher, with Taiex and Kospi leading winners as chipmakers rally. Hong Kong and mainland China indexes are regional laggards. The MSCI Asia Pacific Index gained as much as 1.7%, the most since April 14. Taiwan’s Taiex index was among best performers in the region, led by a surge in TSMC to a record. Markets in Vietnam and New Zealand were closed for holidays. Asian companies are also heading into the busiest week of the earnings season, offering investors a glimpse of how the Iran war has impacted business. In Japan, investors are keeping an eye on the Bank of Japan’s interest rate decision on Tuesday. The BOJ is widely expected to keep rates unchanged.

“Investors are paying attention to the Asia tech sector, especially with a large amount of suppliers here,” Jasmine Duan, Asia senior investment strategist at RBC Wealth Management, said in a Bloomberg TV interview. Despite risks of overbuying in big tech names such as TSMC, “the earnings growth will digest the concern on this overcrowded trade.”

In FX, the Bloomberg Dollar Spot Index falls 0.2%. The Norwegian krone is leading gains against the greenback, rising 0.6%. The Aussie and kiwi dollars also outperform.  The yen hovers around 159.20/USD and euro holds near 1.1730. Offshore yuan gets a boost from solid PBOC fixing.

In rates, treasuries trade slightly cheaper in early US trading, off session lows reached following slight gap lower at start of Asia session.  Treasury yields cheaper by as much as 1.5bp at long end with curve slightly steeper on the day, keeping spreads within 1bp of Friday’s closing levels. 10-year near 4.31% is ~1bp cheaper on the day, roughly in line with European counterparts. European government bonds also decline. Treasury auction cycle begins with $69 billion 2-year note at 11:30am New York time and $70 billion 5-year at 1pm. WI 2-year yield near 3.79% is ~15bp richer than last month’s, which tailed by 1.8bp

In commodities, oil is higher with the Strait of Hormuz almost impassable after efforts to resume talks to end the Iran war stalled. Brent crude futures rise over 2% and briefly topped $108 a barrel after efforts to resume US-Iran talks faltered over the weekend. Precious metals are little changed while Bitcoin falls 0.5%.

Today's US economic data calendar slate is light - we only get the April Dallas Fed manufacturing activity at 10:30am - ahead of a heavy central bank schedule where major CBs are expected to hold ahead of the market pricing changes in June

Market Snapshot

• S&P 500 mini little changed
• Nasdaq 100 mini little changed
• Russell 2000 mini little changed
• Stoxx Europe 600 little changed
• DAX +0.4%
• CAC 40 +0.2%
• 10-year Treasury yield +1 basis point at 4.31%
• VIX +0.4 points at 19.07
• Bloomberg Dollar Index -0.2% at 1193.96
• euro +0.2% at $1.1746
• WTI crude +2.2% at $96.51/barrel

Top Overnight News

• Iran has offered to end its chokehold on the Strait of Hormuz in exchange for the U.S. lifting its blockade on the country and an end to the war, while proposing that discussions on the larger question of its nuclear program would come in a later phase. Trump is unlikely to accept the offer. AP
• Oil rose as Iran’s foreign minister Abbas Araghchi arrived in Russia for talks with Vladimir Putin, while traders shrugged off an Axios report of a potential interim Hormuz deal. BBG
• The US Secret Service is at risk of not being not being able to pay its employees by the end of the week, suggesting that a shutdown nears its breaking point: Semafor
• Kevin Warsh’s path to Fed chair cleared after GOP holdout Thom Tillis dropped his resistance, following the DOJ’s decision to end a criminal probe into Jerome Powell. A vote is set for Wednesday. BBG
• US drivers have started cutting back their spending at the pump in an attempt to blunt the impact of spiraling petrol prices triggered by the Iran war. Between February and March average petrol sales per station in the northeastern US fell 4.3 per cent in March, compared with 0.6 per cent growth in the same period last year, according to data from Upside, which tracks consumer spending at more than 23,000 petrol stations across the nation. FT
• With just over one-fourth of S&P 500 companies reporting results for the first quarter, Wall Street’s expectations for earnings suggest big U.S. companies are far healthier than wider economic concerns might indicate. WSJ
• DeepSeek is aggressively pitching low-priced-plans for its just-released flagship model, intensifying competition across a Chinese artificial intelligence industry trying to take on Silicon Valley’s best. BBG
• US State Department has reportedly ordered a global warning over alleged AI IP theft involving DeepSeek and other Chinese firms: Reuters
• Meta’s $2 billion acquisition of AI startup Manus was blocked by China, a surprise move to unwind a deal that’s drawn fire for the leakage of technology to the US. BBG
• Profits at China's industrial firms grew at their quickest pace in half a year last month, adding to broader signs of ‌an uneven economic recovery in the first quarter as policymakers brace for the impact of the Middle East war. RTRS
• Japan is moving to tighten the criteria for submitting shareholder proposals, signalling a growing backlash from companies frustrated by intensifying pressure from activist investors calling ‌for change. RTRS
• The US and Japan plan a dual-use partnership to counter China in the drone market: Kyodo 

Middle East News

• Iran has communicated a three-stage negotiation process to the US through intermediaries, according to Al Mayadeen citing Iranian reports. The first stage would focus on ending the war and receiving guarantees to prevent recurrence. Second stage is to be focused on the Strait of Hormuz while the third stage would lead to the nuclear issues. Axios later announced a similar report, adding that US President Trump is to hold a situation room meeting on Iran on Monday.
• US President Trump cancelled sending Steve Witkoff and Jared Kushner to Pakistan for talks with Iran, saying there would be “too much time wasted on travelling”. Trump said the US “has all the cards” and Iran “has none”, adding that “if they want to talk, all they have to do is call”. Trump later said the US would not travel “15, 16 hours” to meet “people nobody’s ever heard of”, adding that US envoys were not meeting Iran’s actual leader. Trump claimed Iran sent a “much better” offer within 10 minutes of him cancelling the envoys’ trip, but said Iran had offered “a lot but not enough”.
• US President Trump said Iran wants to talk and see if they can make a deal, US officials negotiating with Iran are dealing with the people who are in charge now. He also stated that Iran plans to make an offer aimed at resolving US demands, according to Reuters.
• Iran's Foreign Minister Araghchi posted on X that discussions in Oman included focusing on ways to ensure the safe transit through Hormuz and that neighbours are the priority. He later stated in Russia, ahead of his meeting with Russian President Putin, that the visit to Islamabad was very good, in which conditions were reviewed for US-Iran talks to continue.
• Iranian Foreign Minister Araghchi described his Pakistan visit as “very fruitful” and said Iran had shared a “workable framework to permanently end the war.” According to reports citing Pakistani officials, Araghchi laid out Tehran's negotiating demands as well as its reservations about US demands. In other talks, IRNA reported that the FM will travel to Muscat and Moscow to hold bilateral conversations, discuss current developments in the region, and the latest situation regarding the war.
• A trilateral meeting with the US, Iran and Pakistan will be considered only after Pakistan meet with Araghchi, a meeting between the US and Iran may not take place until Monday, Axios reported. US Special Envoy Witkoff and Kushner is to hold separate talks with Pakistan on Sunday.
• Axios reported that a US official and a source said Ghalibaf grew frustrated with the infighting in the Iranian leadership after the previous round of talks, and even threatened to step aside. It still remains unclear if he is the lead Iranian negotiator.
• Iran is reportedly "discussing the uranium and nuclear issue with friends and allies and is open for discussion at the negotiating table.", Journalist Mallick reported. Full post:"To my understanding, While Iran has proposed a structured operational mechanism for Strait of Hormuz which would lead to cessation of hostilities, at the same time, contrary to reported, Iran is discussing the uranium and nuclear issue with friends and allies and is open for discussion at the negotiating table.".
• Hezbollah outlines that they will be keeping their weapons, and dismisses the prospect of direct talks with Israel regarding Lebanon.
• Iran's proposal regarding Hormuz may be rejected by Washington because it excludes nuclear discussions, Al Hadath reported citing regional officials.
• Senior Israeli officials have told their American counterparts that if Hezbollah continues its attacks against IDF soldiers, Israel will not be able to respond in a measured manner, Journalist Stein reported citing sources.
• Israeli military reported hostile aircraft infiltration sirens sounded in northern Israel communities.
• Iranian Foreign Minister Araghchi said the visit to Islamabad was very good, in which conditions were reviewed for US-Iran talks to continue. Agreement has been made between Iran and Oman to continue consultations at an expert level.
• Israeli occupation forces are shelling Gaza beaches from the sea, according to Al Jazeer sources.
• Iran gave the US a new proposal through Pakistani mediators for reaching a deal on reopening the Strait of Hormuz and ending the war however postponing nuclear talks, Axios reported citing sources. US President Trump to hold a situation room meeting on Iran on Monday.
• Israeli artillery shelling targets eastern Gaza City, Al Mayadeen reported.
• Iran's Foreign Minister Araghchi posted on X that discussions in Oman included focusing on ways to ensure the safe transit through Hormuz and that neighbours are the priority.
• Lack of trust between Washington and Tehran hinders resumption of negotiations, Pakistani source tells Asharq.
• Iranian F-5 fighter jet reportedly breaches US air defences and hits a US military base in Kuwait, according to Press TV.
• US CENTCOM announces that the US has directed 38 ships to turn around or return to post since the start of the blockade.
• UKMTO reported of an incident occurring 6NM northeast of Somalia, where unknown persons seized the cargo ship and diverted it into territorial waters.

A more detailed look at global markets courtesy of Newsquawk

Asia-Pac stocks pointed to a broadly positive start of the week, mainly spurred by an Axios report detailing that Iran gave the US a new proposal, through Pakistani mediators, for reaching a deal on reopening the Strait of Hormuz and ending the war. It is a three-stage proposal, with the halting of the war and focus on the Strait of Hormuz highlighted as the key points before the third stage of nuclear issues. ASX 200 was the underperformer, being weighed on by losses in Energy and Utilities following Friday’s risk-on sentiment hitting energy prices. Among the weakness, Atlas Arteria outperformed after IFM investors offers to buy the Co. for AUD 4.75/security. Nikkei 225 initially traded with a lack of direction before being boosted following the Axios report. The index has regained the 60,000 handle and continued to gain towards 61,000. KOSPI was the clear outperformer as it tracks its peers’ stateside. This was spearheaded by Intel (INTC) after the Co. reported positive Q1 earnings and beat forecasts. Hang Seng and Shanghai Comp. traded with mild gains. Chips across Asia are performing well, with China’s SMIC also benefiting from the announcement that DeepSeek’s V4 is adapted to run on Huawei chips.

Top Asian News

• Japanese Coincident Index Final (Feb) 116.3 (Prev. 117.9).
• Japanese Leading Economic Index Final (Feb) 113.3 vs. Exp. 112.4 (Prev. 112.1).
• Chinese Industrial Profits (YTD) YoY (Mar) Y/Y 15.5% (Prev. 15.2%).

European bourses are mostly firmer this morning, albeit modestly so. The DAX 40 (+0.4%) leads vs peers, whilst the AEX (-0.3%) lags a touch. European sectors opened with a positive bias, but the leaderboard now looks mixed. Topping the pile is Retail, led by Adidas, +1.6%, where two runners wore its new ultra-light racing shoe to break the two-hour barrier at the 2026 London Marathon. Also performing well is the Energy sector, with oil benchmarks firmer on the day. At the bottom of the pile are the consumer-sensitive Optimised Personal Care and Food Beverage & Tobacco

Top European News

• ECB SAFE Survey: Firms reported further net tightening of bank loan interest rates and other loan conditions related to price and non-price factors. Firms reported further net tightening of bank loan interest rates and other loan conditions related to price and non-price factors. Financing needs remained stable, but availability of bank loans deteriorated marginally. Firms expected stronger increases in selling prices and non-labour input costs, whereas wage expectations moderated slightly. Short-term inflation expectations increased markedly, with medium-term inflation expectations remaining stable.
• UK Chancellor Reeves is to deliver speeches to set out a responsible plan to see households and businesses through the Iran war fallout, according to the FT citing sources; the Chancellor will also set out measures in June to boost growth.
• UK ministers have voiced concerns about the damage to the tech sector and its alliance with the US as the PM plans for closer relations with the EU, FT reported citing sources.

Central Banks

• BoJ Deputy Governor Uchida to join policy meeting by phone due to health reasons.
• Swiss Sight Deposits (CHF) (w/e Apr 24th): total 455.91bln (prev. 453.55bln), of domestic banks 433.01bln (prev. 433.27bln).

Trade/Tariffs

• India and New Zealand have signed a FTA, lowering and eliminating tariffs across a range of goods, and granting 100% duty-free access for Indian exporters.
• China's Commerce Ministry is to hold a press conference on Thursday 30th at 08:00BST/03:00EDT to brief on recent key trade and commerce developments.
• China's MOFCOM issues a statement on the EU Industrial Accelerator Act, calling it discriminative for trade; will closely monitor and engage in dialogue with the EU but threatens countermeasures if the EU presses ahead.

Geopolitics

• A drone has hit the transportation department of Ukraine's Zaporizhzhia plant, according to reported.
• Iranian FM Araghchi has arrived in Russia ahead of his meeting with Russian President Putin, Tasnim reported.
• North Korea's Supreme Leader Kim Jong-un said that North Korea will continue to support Russia, KCNA reported.
• Russia's Foreign Minister reportedly said Russia is willing to hold talks with the US on a Ukraine settlement.

FX

• FX shows a risk-on picture not seen across other asset classes, in a move seemingly driven by a weaker greenback, with antipodeans and generally high-beta FX outperforming.
• DXY is lower by 0.2%, well off highs of 99.34 made at the Asia re-open and below both 100 and 200 DMAs, which offered support last week. This comes as Axios reported that Iran gave the US a new proposal for reaching a deal on reopening the Strait of Hormuz, news which has helped the risk complex. The plan calls for an extension of the ceasefire so parties can work on a three-stage plan, with nuclear negotiations the final stage. The report noted that Pakistani mediators had given the proposal to the US, though it was unclear if the US would cooperate. The US-specific docket is light ahead of this week's FOMC meeting, with just 2 and 5yr supply, and Dallas Fed Manufacturing scheduled.
• Away from geopolitics, and perhaps another story which has offered the USD: Senator Tillis said he was dropping his decision to block the nomination of Kevin Warsh as Fed Chair following the DoJ's decision to drop the criminal case against Fed Chair Powell. The vote on Warsh's confirmation is scheduled for 29th April.
• Antipodeans outperform, the cross is choppy and around the unchanged mark as both currencies benefit against the weaker Buck following that Axios report. NZD/USD, AUD/USD +0.6%/+0.5%. CAD also does well, helped by the risk environment alongside Crude benchmarks, which are firmer on the session.
• EUR/GBP is a touch firmer after it bounced off a 0.8654 low to try to recoup last week's modest losses following strong UK data. Both currencies look to expected holds from the ECB and BoE. In the UK, political angst persists, with the Daily Mail reporting that former Deputy PM Rayner told Labour MPs the time to oust the PM was “now or never”.

Fixed Income

• A softer start to the week, as energy upside lifts yields and weighs on fixed benchmarks. However, the magnitude of fixed action is relatively limited amid mixed geopolitical reporting, awaiting supply and the week's packed central bank agenda, which includes the BoE, ECB & Fed.
• USTs as low as 111-01, with downside of 5+ ticks at most. If the move extends, we look to 110-27+ and 110-26+ from Friday and Thursday, before attention then turns to 110-22+, 110-17+ and the 110-16 MTD low from earlier in April. The US agenda is, aside from geopolitical updates, headlined by 2yr & 5yr note supply ahead of Wednesday's Fed.
• Gilts gapped lower by 23 ticks and then slipped another 12 to an 87.13 low. Modestly underperforming peers, given the above. Elsewhere for the UK, we count down to Thursday's BoE, a hold is expected and priced, with attention on any clues via the statement, forecasts, or individual Committee members' remarks as to when a move might occur. Currently, markets imply 25bps hikes in July (+30bps) and December (+54bps).
• Bunds in-fitting with the above. Somewhere between USTs and Gilts in magnitude. As low as 125.48, posting losses of 17 ticks at most. Driven by the above geopolitical developments. No move to a weak GfK survey for May, as consumer sentiment was hit again by the Middle East conflict, resulting in a sharp decrease in income expectations and the 12-month view moved to a level similar to April 2022, at the start of the Ukraine conflict.
• China delays foreign debt sales with USD 100bln of bonds due, Bloomberg reported.
• EU sells EUR 6bln vs exp. EUR 7bln 2.50% 2031, 3.25% 2036, and 4.00% 2044 Bonds.

Commodities

• WTI and Brent are both firmer this morning by circa. 2.6%, as the complex digests several geopolitical updates, with the overarching theme overall a lack of progress between US-Iran.
• To recap, US President Trump cancelled his envoy’s trip to Pakistan, suggesting that it would be a waste of time. He claimed that Iran sent a “much better” offer within 10 minutes of him cancelling the trip, but it was “not enough”. Since, Axios reported that Iran had communicated a three-stage negotiation process to the US through intermediaries. A first stage would involve securing guarantees to prevent another war, with the next stage to focus on the Strait and then finally on nuclear issues. Given that this proposal pushes the nuclear issue to the back of the agenda, it is not likely that the US will accept the proposal. The focus ahead will be on Trump, who is reportedly to hold a situation room meeting on Iran.
• WTI and Brent climbed higher throughout the European morning; Brent Jun’26 sits at the upper end of a USD 106.19/bbl to USD 108.24/bbl range, with WTI Jun’26 also at highs within a USD 94.99/bbl to USD 96.87/bbl band. Both contracts jumped at the open as markets digested Trump’s cancellation of talks, but then slipped on the aforementioned Axios report. The proposal indicates some openness to negotiations, but given that the nuclear issue has been pushed to the back of the agenda, it is unlikely to be accepted by the US. A factor which likely explains the complete reversal of the initial downside following the report.
• Spot gold is essentially flat this morning and currently trades within a USD 4,672-4,729/oz range. It currently oscillates around its 21 DMA (4,718/oz), with the high of the day a touch short of its 100 DMA (4,746/oz). Elsewhere, base metals hold a slight negative bias, but with slight strength in Aluminium prices, given the elongated disruption of supplies from the Middle East region. As for 3M LME Copper, it is currently a little lower within a USD 13,259-13,376.03/t range.
• Iran suspends exports of steel slabs and sheets until 30th May, Iranian media reported.
• Citi raises its base case average Brent price forecasts to USD 110/bbl for Q2, USD 95/bbl for Q3, USD 80/bbl for Q4. Flows could easily remain disrupted through the end of June, which could see Brent reach USD 150/bbl.
• Goldman Sachs raises its Brent forecast to USD 100/bbl this quarter and USD 90/bbl in Q4, due to prolonged disruption in the Strait of Hormuz and extreme inventory draws.
• Japanese PM Takaichi said Japan has secured stable oil supply into next year, closely watching the Middle East impact on the economy.

US Event Calendar

• 10:30 am: United States Apr Dallas Fed Manf. Activity, est. 0.8, prior -0.2

DB's Jim Reid concludes the overnight wrap

Tomorrow marks exactly two months since the strikes on Iran began. While there is currently a rolling, open ended ceasefire that started on 8 April, the risk of it collapsing at any point remains real. Just as the weekend news looked like it was leaning negatively though, last night reports came through that Iran have offered the US a fresh proposal to reopen the strait and end the war. However as Axios and others reported, this proposal postpones talks on nuclear capabilities. So it’s unclear whether the US Administration would tolerate that but for now the market is trading better than it might have done to start the week. This fresh development follows President Trump cancelling a planned visit to Islamabad by envoys Kushner and Witkoff, saying that the Iranians had “offered a lot, but not enough.” Iranian President Pezeshkian, meanwhile, said Iran would not agree to “imposed negotiations under threats or blockade.” The coming week will no doubt bring further developments, though predicting them is close to impossible. When the conflict began more than eight weeks ago, I would have expected it to be comfortably over by now, with markets having followed the usual playbook and fully recovered. The market reaction has largely played out, but for the wrong reasons: the conflict is not over. That said, markets still appear to price in a meaningful chance that it will be resolved relatively soon. Polymarket, for example, suggests a 56% probability of traffic returning to normal by 30 June, although this briefly reached 91% ten days ago when it appeared that Iran was reopening the Strait.

In other news, one notable development yesterday was Senator Thom Tillis’s decision to lift his block on Kevin Warsh’s nomination to chair the Fed. Tillis said he was satisfied with the Department of Justice’s decision late last week to drop its investigation into the Fed refurbishment. There had been some concern on Saturday that the DoJ had left the door open to reopening the probe at a later stage, which might not have been sufficient to clear the way. However, Tillis indicated that he had received assurances that gave him enough comfort to remove his block.

In terms of overnight markets, Brent crude is up +1.22%, marking the sixth consecutive session of gains, trading at $106.61 per barrel, following the weekend news. However regional equities are strong with the KOSPI (+2.57%) now at +57.6% YTD. The Nikkei (+1.88%) is also strong. Other markets are a bit more subdued with the Hang Seng (+0.15%), the CSI (+0.21%), and the Shanghai Composite (+0.15%) slightly higher but with the S&P/ASX 200 (-0.14%) dipping. S&P 500 (+0.13%), NASDAQ 100 (+0.34%) and STOXX (+0.33%) futures are edging higher. both trading in positive territory. Meanwhile, 10-year USTs have risen by +1.9bps, to 4.32% as we go to print.  

Looking ahead, with central bank meetings for every G7 country this week — alongside 44% of the S&P 500 reporting by market capitalisation, including five of the Mag 7 — it is shaping up to be a blockbuster week, even before factoring in ongoing Iranian war newsflow.

The Bank of Japan meets tomorrow, followed by the Fed and the Bank of Canada on Wednesday. Thursday then brings decisions from the ECB and the Bank of England. All are expected to remain on hold, but the key question will be how each central bank’s reaction function is shaped by the conflict and the associated stagflation risks. Our new "Rate Check" podcast previews the week's meetings with various guests from our research department. Click here for more on how to find it 

From an earnings perspective, 22% of S&P 500 market capitalisation — across just four companies — reports after the close on Wednesday, when Alphabet, Microsoft, Amazon and Meta release their Q1 results. Apple follows on Thursday.

Turning to the Fed meeting mid week, our economists’ base case is that any meaningful change in guidance is deferred until June. That said, there is a tangible risk that communication skews modestly hawkish — either through subtle language tweaks around “additional policy adjustments” or via Chair Powell signalling a more symmetrical assessment of risks to the dual mandate. An explicit acknowledgement that risks to price stability and employment are now more evenly balanced would likely be interpreted as a marginally less accommodative stance.

Geopolitics will loom large in Powell’s press conference, given developments in the Middle East. With uncertainty still elevated, Powell is likely to emphasise that policymakers cannot yet assess the precise implications for growth or inflation. However, he may also note that persistently high oil prices raise the risk of inflation becoming more entrenched over time. Overall, the tone should be consistent with a Fed prepared to remain on the sidelines for a while longer.

Alongside the meeting, Thursday’s personal income and spending report — and particularly core PCE — will be equally important. Income is expected to rebound by 0.6% after a 0.1% decline, while consumption is forecast to rise 0.5%. DB expects the core PCE deflator to increase by 0.25% month on month, lifting the year on year rate to around 3.13%. If realised, Q1 core PCE inflation will average just above 3.0%, marking five years since the Fed’s preferred underlying inflation gauge last ran at or below its 2% target. Our latest projections see core CPI and core PCE at 2.7% and 2.9% respectively by Q4 2026, highlighting how recent energy related shocks continue to complicate the path back to target.

Other data ahead of the meeting are unlikely to materially alter the Fed’s decision. Consumer confidence tomorrow is expected to fall to 88.8 from 91.9, reflecting heightened geopolitical concerns. More important than the headline will be the “jobs plentiful” and “jobs hard to get” components, which historically track movements in the unemployment rate and offer insight into perceived labour market momentum.

Wednesday brings a cluster of releases that will refine expectations for Thursday’s advance Q1 GDP estimate. Housing starts are forecast to rise to 1.425 million from 1.35 million, with permits edging up to 1.390 million. Durable goods orders are expected to fall 0.4% for the headline, but ex transportation and core orders are projected to rise 0.5%, pointing to continued strength in capital investment. Together with the advance goods trade balance, these data frame our economists’ 2.8% annualised forecast for Q1 real GDP — a sharp rebound from 0.5% in Q4.

Thursday’s data batch is the most consequential of the week, even beyond core PCE. While DB still expects 2.8% inflation adjusted growth for Q1 GDP, the composition has shifted meaningfully. Consumer spending is forecast to contribute 1.2pp, down from 1.9pp in Q4, while non residential fixed investment accelerates sharply to 7.5%. Final sales to private domestic purchasers — our preferred measure of underlying demand — are projected to edge up to 2.0%. Risks to the headline GDP number appear broadly balanced, particularly given volatility in trade flows.

Elsewhere on Thursday we see the employment cost index and the Chicago PMI. Friday kicks off May with the ISM manufacturing index and vehicle sales. While business surveys may not yet fully reflect recent war developments, they should provide early signals on whether firms share markets’ confidence that the conflict will have limited and temporary economic effects. Last week’s flash PMI suggested US businesses remain far more confident on this front than their European counterparts.

In Europe, attention turns to preliminary April CPI prints, with Germany and Spain reporting first on Wednesday and the broader euro area numbers on Thursday, alongside advance Q1 GDP. Ahead of that, Tuesday brings the ECB’s consumer expectations and bank lending surveys.

In Japan, key releases include April Tokyo CPI on Friday and March activity data on Thursday, while China sees its official April PMIs on Thursday, following industrial profits for March earlier in the week. As usual, the full day by day calendar appears at the end.

Recapping last week now and markets lost their momentum as concern rose about an extended closure of the Strait of Hormuz. However, there was more of a risk-on move into the weekend, driven by the news that Iran’s foreign minister was heading to Islamabad, and then that Steve Witkoff and Jared Kushner were going from the US side. So that raised hopes that some kind of de-escalation pathway might still be open. Ultimately that proved premature as we found out over the weekend. The positive mood at the very end of the week was cemented after it was announced that the US Department of Justice were dropping the criminal investigation into Fed Chair Powell, which raised expectations that Kevin Warsh would be confirmed on time as the new Fed Chair.  

Yet despite that more optimistic tone into the weekend, Brent crude oil still rose +16.54% last week (+0.25% Friday) to $105.33/bbl. That came as the Strait of Hormuz remained closed, adding to fears about longer-term supply disruption. And it was clear that investors were pricing in a prolonged period of higher oil prices, as the 6-month Brent future also moved up +8.88% last week (-0.32% Friday) to $86.46/bbl.
For markets, those oil moves led to growing expectations of an extended stagflationary shock. Indeed, that was clear from inflation expectations, which moved up again in response. For instance, the US 1yr inflation swap rose +29bps last week to 3.378%, and the Eurozone inflation swap was up +47bps to 3.44%. And in turn, that led investors to price in a more hawkish response from central banks. For instance, for the ECB the probability of a hike by the June meeting rose from 62% to 82%. Meanwhile, the probability of a Fed cut by the December meeting had fallen from 61% to just 23% by Thursday, before rising back up to 46% on Friday on news of the DoJ probe into Powell being dropped, which raised expectations that a Warsh-led Fed could still deliver easing this year.

With markets pricing in a bigger stagflationary shock and a more hawkish response across most of the week, it was a tough backdrop for bonds. So the 10yr bund yield rose +3.4bps last week (-1.5bps Friday) to 2.99%, and the 10yr Treasury yield was up +5.2bps last week (-2.4bps Friday) to 4.30%. In Japan, the moves were relatively smaller, but even there the 10yr yield was up +1.5bps last week (+1.0bps Friday) to 2.44%.  

For equities, there was a more divergent performance by region. In the US, the S&P 500 posted a 4th consecutive weekly gain to hit a new record, rising +0.55% last week (+0.80% Friday). Indeed, the last time the S&P posted four consecutive weekly gains was back in October 2024. Meanwhile, the Philadelphia Semiconductor Index continued its relentless rally, posting a record 18th consecutive daily gain on Friday, with a rise of +10.02% last week, including +4.32% on Friday after strong results from Intel. Japan’s Nikkei also advanced +2.12% (+0.97% Friday). But in Europe, the STOXX 600 fell -2.54% last week (-0.58% Friday), reflecting the region’s greater exposure to an energy shock that was also visible in the weak April flash PMIs.

Finally in credit, there was a mixed performance last week amidst the various headlines. In the US, IG spreads were flat, but HY spreads widened +6bps. Conversely in Europe, IG spreads widened +2bps, but HY spreads tightened -10bps.

Tyler Durden Mon, 04/27/2026 - 08:34

Israel Bombs Deep Into Lebanon For First Time Of 3-Week Ceasefire

There's supposed to be a 3-week Lebanon ceasefire in effect, but that increasingly appears something merely on paper or in name only, as Israel has stepped up and expanded its attacks on Lebanon - now for the first time of the ceasefire including strikes on the far away Beqaa Valley.

"The IDF says it has launched a wave of airstrikes against Hezbollah infrastructure in the Beqaa Valley and several areas of southern Lebanon," Israeli media confirms Monday. "The strikes come following repeated Hezbollah attacks on IDF troops and Israel during the ceasefire, including a deadly drone attack yesterday," Times of Israel says.

The fresh reporting emphasizes that "Israel has not struck in Lebanon’s eastern Beqaa Valley in some three weeks."

Lebanese President Joseph Aoun via aawsat

The IDF says its response was necessary as it has been Hezbollah breaking the ceasefire with attacks on Israeli ground forces, but Hezbollah has justified that these troops occupy sovereign Lebanese territory and so are fair game to be targeted.

It was only late last week that President Trump publicly announced a breakthrough Lebanon ceasefire deal of three weeks, saying it is necessary also to "protect" Lebanon "from Hezbollah".

But Hezbollah itself has not participated in the Washington-backed talks between the Israeli and Lebanese governments, seeing in it a deceitful plan to put more distance between the Iran-backed paramilitary group and the Lebanese nation and people.

In the meantime, Lebanon’s President Joseph Aoun has told a meeting of representatives from villages in southern Lebanon that negotiating with Israel "is not betrayal" - but is necessary for ensuring peace and stability.

The president, a Maronite Catholic, stated instead that "Betrayal is carried out by those who take their country to war to serve foreign interests."

Aoun said: "How long will the people of the south continue to pay the price for the wars of others on our land? If the war were for Lebanon, we would support it - but when its purpose is to serve the interests of others, I reject the war entirely."

The remarks appeared a response to Hezbollah leader Naim Qassem's own Monday statement reiterating that the group would not give up its weapons and blasting deal-making with Israel as a "grave sin". After all, while the IDF obliterates entire towns and villages in the south, Hezbollah's supporters argue there's no one to protect them, and certainly the Lebanese Army won't step up.

Israel is exporting its Gaza model to Lebanon.
Demolition by demolition, the Israeli military is changing the face of southern Lebanon, razing towns and villages to create a buffer zone. Israeli officials say it’s necessary to protect its residents from Hezbollah threats. pic.twitter.com/64qAebvKOl

— Jeremy Diamond (@JDiamond1) April 24, 2026

Qassem further accused some politicians in in Lebanon of seeking to "reap gains at the expense of the destruction" of the country.

The war goes back to the wake of Oct.7, 2023 and Gaza war. But Hezbollah's entry was also renewed following Trump's Operation Epic Fury. So Hezbollah has successively joined the fight both related to the Palestinian and the Iranians. Israel has unleashed a series of massive bombing waves on the capital Beirut, and many ordinary Lebanese have chaffed at being so quickly dragged into a broader regional war.

Tyler Durden Mon, 04/27/2026 - 08:30

Beijing Abruptly Blocks Meta's $2BN Takeover Deal Of Manus AI In Move That Will "Chill" China AI Sector

With just weeks to go before the Trump-Xi meeting in Beijing, China's National Development and Reform Commission unexpectedly blocked Meta Platforms' acquisition of the AI-agent startup Manus on Monday morning, signaling that Beijing has no problem with tightening control over high-value AI assets in a move that could have a profound chilling effect on Chinese M&A activity for years. 

According to the FT, the decision marks an extraordinary late-stage intervention by Beijing, involving two non-Chinese companies. Meta had already begun to integrate software from Manus, which was founded in China but relocated to Singapore last year.

The announcement comes ahead of an expected summit next month between US President Donald Trump and his Chinese counterpart Xi Jinping, when the leaders will address longstanding tensions over trade.

Manus’s founders got their start in China but relocated their headquarters and key staff to Singapore in 2025. It wasn’t clear, when the deal took place, whether Beijing would exert its authority on a transaction that technically took place beyond its borders.

China’s powerful National Development and Reform Commission (NDRC) said on Monday it would prohibit “foreign investment” in Manus and in accordance with the law has “required the relevant parties to cancel the acquisition transaction”.  Regulators began investigating in January whether China’s investment rules had been violated by Silicon Valley-based Meta’s acquisition of Manus, whose autonomous AI tools can carry out complex tasks.

Manus allows users to build and run personal AI “agents” that are capable of independently executing complex tasks, managing files and creating software. The original creator of the company, AI start-up Butterfly Effect, was founded in China in 2022. Last year, Butterfly Effect moved its headquarters and core team to Singapore following a funding round led by top US venture capital firm Benchmark Capital.

The Manus app was an early forerunner of OpenClaw, which has taken both Silicon Valley and China by storm this year. Both go beyond the likes of OpenAI’s ChatGPT, which largely focuses on processing information and answering questions.

Within months, Meta swooped in to buy the AI app, as part of the parent of Instagram and WhatsApp’s costly efforts to catch up with OpenAI and Google in AI. The $2bn deal was announced in December and closed earlier this year.

The current listing for what is described as “Manus from Meta” on Apple’s App Store still describes Butterfly Effect’s Singaporean entity as the software’s developer. 

It was unclear how the acquisition could be unwound at such a late stage, and a person briefed on Beijing’s decision told the FT the announcement could be intended primarily as a warning for similar deals in the future. The person said the gesture was “pretty harsh and it carries a strong intention to stop follow-on deals [like Manus]. In reality, it’s hard to unwind a done deal, so it is more about verbal warnings on similar deals and [leverage] building before the Xi-Trump summit”.

To undo the deal at this stage, Meta could have to spin off its acquisition to a new buyer, sell it back to its former investors or find new backers. Any such process would be complex, as Meta has already integrated Manus into some of its tools, the FT has reported.

“The Manus block is a clarifying moment,” said Ke Yan, a tech analyst with DZT Research based in Singapore. “Manus was Singapore-incorporated with founders based here, and it still got pulled back. Beijing’s signal is that what matters isn’t where the legal entity sits.”

A Meta spokesperson said: “The transaction complied fully with applicable law. We anticipate an appropriate resolution to the inquiry.”

Multiple Chinese regulators have reviewed the transaction, including the NDRC, the commerce ministry and China’s antitrust watchdog, the FT reported this month. Beijing earlier branded the acquisition a “conspiratorial” attempt to hollow out the country’s technology base.

Officials had been examining the deal using a range of tools, from export control rules to foreign investment and competition laws, the people said. In March, Beijing restricted two co-founders of Manus from leaving the country as the deal was reviewed.

Manus describes itself as an “action engine” that can “extend your human reach”. It launched in March 2025, just two months after DeepSeek’s debut of a powerful open-source model capable of “reasoning” sparked a panic among US tech investors about Chinese AI advances.

The Manus acquisition represents the second major deal in which Beijing has intervened, following the sale by CK Hutchison of 43 global ports, originally including two in Panama, to a BlackRock-backed consortium. In that case, authorities pushed for the acquiring party to include a Chinese group as well, although that deal has not yet closed.

The ruling is likely to send a chill through China’s burgeoning AI sector, and emerged weeks before a high-profile summit between US President Donald Trump and China’s Xi Jinping. Beijing has tightened scrutiny of key industry firms in the wake of the deal, which has been largely completed. Initially hailed as a template for startups with global aspirations, critics have since lamented the loss of valuable technology to a geopolitical rival.

The decree on Manus may deal a setback to Meta as it looks to compete in AI against rivals from Microsoft Corp. and Alphabet Inc.’s Google to OpenAI and Anthropic PBC. Manus was supposed to help Meta — which had been playing catchup — leapfrog into a leading position in the hot sphere of AI agents, or services that use artificial intelligence to execute tasks.

Beijing and Washington are jockeying for leverage ahead of their historic meeting in May. As rivalry heats up in the AI space, Xi is trying to both fence off China’s top technology and talent from the US with the Manus move, while underscoring his growing confidence in homegrown chips, Bloomberg reported.

The latter point was on display last week when DeepSeek unveiled its V4 model that boasts deeper synergy with Huawei Technologies Co. chips. That high-profile release looked timed to project confidence ahead of Trump’s visit.

“Beijing likely views this move as a justified tit-for-tat and mirroring of the export controls, investment restrictions, and counter-tech transfer probes by American authorities over the years,” said Brian Wong, an assistant professor at the University of Hong Kong.

Agencies including the National Development and Reform Commission have told key AI firms including Moonshot AI and Stepfun in recent weeks they should reject capital of US origin in funding rounds unless explicitly approved, Bloomberg News reported last week. Regulators have also decided on similar restrictions for ByteDance Ltd., the owner of TikTok and the most valuable startup in the country.

Those restrictions risk further isolating China’s recovering tech sector from the venture backing that has underpinned it for two decades, much of which was sourced from American pensions and endowments. It follows Beijing’s decision to restrict “red chips” — a type of Chinese company incorporated overseas — from seeking initial public offerings in Hong Kong, threatening to upend a decades-old playbook that helped Chinese companies tap foreign capital by floating overseas.

The overarching intent of the restrictions is to prevent US investors from taking stakes in sensitive sectors where national security is a priority. The twin moves suggest that regulators are worried about a leakage of homegrown technology abroad as Chinese-founded startups and companies explore international opportunities. In the wake of the Manus acquisition, many academics decried the loss of a valuable asset to the US. Many worried that the deal would encourage other startups to follow suit.

Tyler Durden Mon, 04/27/2026 - 08:20

Battered Budget Airlines Ask White House For $2.5 Billion Lifeline

Budget airlines have requested a $2.5 billion relief package from the Trump administration following a meeting with Transportation Secretary Sean Duffy early last week. This comes as elevated jet fuel prices squeeze operations, and after President Trump confirmed late last week that a possible U.S. takeover of bankrupt Spirit Airlines is under consideration.

The Wall Street Journal reports that a group of budget airlines, including Frontier and Avelo, has requested federal support in exchange for convertible equity stakes in the airlines. The $2.5 billion figure is based on extra fuel costs if jet fuel prices remain above $4 per gallon through the second half of the year.

WSJ cited people familiar with the potential economic aid package and said talks will continue this week.

Trump last week told reporters that he likes "having a lot of airlines, so it's competitive." Plus, the optics of multiple airline failures that could result in thousands of job losses would be optically displeasing for the administration in the midterm election cycle.

Apparently, the request is separate from the potential taxpayer-funded takeover of Spirit, which Trump confirmed last week was a very real possibility "if the price was right."

Trump told reporters:

So we are looking at Spirit. It's in bankruptcy court. And we're looking, if we could get it for the right price, I'd do it to save the jobs.

Polymarket:   US takes a stake in Spirit Airlines by May 31?
Yes 36% · No 64%
View full market & trade on Polymarket //--> //--> Spirit Airlines shutdown/liquidation by May 31?
Yes 51% · No 49%
View full market & trade on Polymarke

Budget carriers have been under tremendous strain since the U.S.-Iran conflict and the closure of the Hormuz chokepoint sent jet fuel prices in New York to $5 per gallon. It appears some of these airlines might not have been properly hedged against such a spike in fuel costs, which has squeezed margins and led to outlook downgrades.

Larger carriers such as United and American have also slashed outlooks because of surging fuel costs, though they say ticket and baggage fee hikes have helped offset some of the extra costs. We noted that Delta remains one of the best-positioned airlines due to its in-house oil refinery.

The S&P 500 Airline Index has struggled to recover and is down 13.5% from its high just before the conflict began.

During the Covid era, U.S. airlines received $54 billion in federal grants and loans to avert mass layoffs after air traffic nearly came to a standstill.

Tyler Durden Mon, 04/27/2026 - 08:05

WHCA Shooter's Tweets Found, Suggesting Radicalization Fueled By Democratic Messaging

Update: 

• Shooter's archived tweets emerge 

• Shooter's Manifesto explained about Trump admin target kill list. He wrote, "prioritized from highest-ranking to lowest" ... 

• Shooter's intent was to Target Trump & admin officials 

• Shooter donated to "Harris for President" via ActBlue 

• Shooter apprehended and taken into custody. Carrying shotgun, handgun and several knives. 

• The shooter has been identified as Cole Tomas Allen, 31, of Torrance California

• No injuries to Trump or any guests.

•  Incident near lobby magnetometer screening.

• Trump praised Secret Service rapid response.

Shooter's Achieved X Posts Emerge

What is particularly alarming about WHCA dinner shooter Cole Allen is that his social media footprint does not reflect a fringe left-wing extremist, but rather an ordinary Democrat who appears to have been conditioned over the past decade by left-wing corporate media and radical left-wing NGOs. This toxic ecosystem manufactured an artificial informational environment in which President Trump was labeled, around the clock, as a "fascist," a "Nazi," and worse, inciting an existential crisis among weak-minded Democrats who have decided to take up violence in response.

This imbecile clearly doesn’t have the faintest clue what actual Nazis would be like

— Elon Musk (@elonmusk) April 26, 2026

We all remember that top Democrats have spent years calling Trump "fascist" and "Nazi" in an information war to delegitimize the president.

If you’re wondering why 3 attempts on President Trump’s life, that we know of, have happened, it’s because of people like Tim Walz who keep saying:

“No one has ever been more dangerous to this country than Donald Trump, and he is a fascist to his core!” pic.twitter.com/4QAy7vzvcJ

— Based Bandita (@BasedBandita) April 26, 2026

Where did Charlie Kirk's murderer learn to call conservatives "fascists"?

"Do you think Donald Trump is a fascist?"

Kamala Harris: "Yes, I do. YES, I DO!" pic.twitter.com/RxDjgOYjKY

— RNC Research (@RNCResearch) September 12, 2025

Where they learned this from!

Democrats ARE the Party of Hate and of Inciting Violence. pic.twitter.com/ONhiBT5KgV

— Donna Marie (@sabback) September 10, 2025

Democrats have one strategy: it's a color revolution. 

Shooter's Manifesto 

CBS News' Jennifer Jacobs has confirmed that the WHCA dinner shooter, Cole Allen, wrote a manifesto stating he was targeting Trump officials:

Administration officials (not including Mr. Patel): they are targets, prioritized from highest-ranking to lowest

Secret Service: they are targets only if necessary, and to be incapacitated non-lethally if possible (aka, I hope they're wearing body armor because center mass with shotguns messes up people who aren't

Hotel Security: not targets if at all possible (aka unless they shoot at me)

Capitol Police: same as Hotel Security

National Guard: same as Hotel Security

Hotel Employees: not targets at all

Guests: not targets at all

In order to minimize casualties I will also be using buckshot rather than slugs (less penetration through walls)

I would still go through most everyone here to get to the targets if it were absolutely necessary (on the basis that most people chose to attend a speech by a pedophile, rapist, and traitor, and are thus complicit) but I really hope it doesn't come to that.

The manifesto also said:

And I am no longer willing to permit a pedophile, rapist, and traitor to coat my hands with his crimes.

(Well, to be completely honest, I was no longer willing a long time ago, but this is the first real opportunity I've had to do something about it.)

Fox News' Will Ricciardella made the point that Allen "wasn't some nut job lurking on the fringes of society, forgotten by the system."

Ricciardella said Allen was "well-educated, credentialed, employed, and institutionally formed. That's what makes this so disturbing."

The WHCA alleged shooter wasn’t some nut job lurking on the fringes of society, forgotten by the system.

He was well-educated, credentialed, employed, and institutionally formed. That’s what makes this so disturbing.

At first glance, this doesn’t look like a breakdown of the…

— Will Ricciardella (@WillRicci) April 26, 2026

In reality, Allen is a byproduct of the Democratic Party's psychological operation via corporate media to delegitimize Trump (color revolution), which has pushed many liberals into an existential crisis, making them believe they must act with violence.

* * * PSST - new ranch. Wagyu. Tomahawk. You have no idea... 

This is similar to MSM's climate propaganda, where liberals actually believed the planet would burn in a few years unless more taxes were imposed and cow farts were banned.

The propaganda:

Allen must've had CNN playing on every device for ten years... 

Cole Allen, the gunman from last night’s WH Correspondents Dinner, maintained an active online presence, especially on the leftwing social media platform Bluesky where he went by the handle https://t.co/bpKnhC8M5a with multiple references violence and guns.

In one post he calls… pic.twitter.com/mvFBE0FAl7

— Andrew Kolvet (@AndrewKolvet) April 26, 2026

Even the globalist publication The Atlantic recently admitted...

MSM propaganda against Trump has pushed some liberals into an existential crisis mode, leading them to feel that violence is the only answer.

Report says Shooter's Intent: Target Trump Admin Officials

New details have emerged about Cole Allen, 31, of Torrance, California, who opened fire at the Washington Hilton Hotel during the White House Correspondents' Dinner last night.

Fox News' Bill Melugin posted on X early Saturday:

Per federal law enforcement sources familiar with the investigation who spoke to @FoxNews, Cole Allen told investigators after his arrest that his intent was to target Trump administration officials at the WHCD.

NEW: Per federal law enforcement sources familiar with the investigation to @FoxNews, Cole Allen told investigators after his arrest that his intent was to target Trump administration officials at the WHCD.

— Bill Melugin (@BillMelugin_) April 26, 2026

GOP activist Scott Presler published Allen's profile data, showing that he is a teacher in California and that he donated to the "Harris for President" campaign through the left-wing funding platform ActBlue.

HOLY COW

The gunman that opened fire at the White House Correspondents’ Dinner is 31-year-old Cole Allen

— a teacher from Torrance, California.

It appears that Cole donated via ActBlue to Kamala Harris for President.

Another radicalized democrat assassination attempt. pic.twitter.com/sEUCFCN0AF

— ThePersistence (@ScottPresler) April 26, 2026

Acting Attorney General Todd Blanche told Bloomberg's Annmarie Hordern that Allen "acted alone after traveling by train from California and had been staying at the Washington Hilton, which was hosting the annual White House Correspondents' Dinner."

Acting Attorney General Todd Blanche tells NBC the suspect is believed to have acted alone after travelling by train from California and had been staying at the Washington Hilton, which was hosting the annual White House Correspondents’ Dinner.

— Annmarie Hordern (@annmarie) April 26, 2026

Let's not forget that the globalist publication The Atlantic was recently forced to admit ...

Shooting strengthens the case for President Trump's new White House ballroom, which would make events like this safer. But activist judges have repeatedly halted construction.

Shooting at White House Correspondents' Dinner

President Donald Trump was evacuated from the head table at the White House correspondent's dinner on Saturday night after a gunman, allegedly 31-year-old Cole Thomas Allen, 31, of California - stormed the event and fired shots in the lobby. Authorities confirm the suspected shooter has been apprehended and is in custody after shots fired near the lobby screening area. President Trump, First Lady Melania Trump, and all protectees were safely evacuated with no injuries reported. The Secret Service continues investigating.

 Trump posted a picture of the suspect on Truth Social along with a video: 

According to Just the News, the gunman was not wounded and was carrying a shotgun, a handgun and several knives. 

In a White House press conference held shortly after the incident, Trump praised the Secret Service and law enforcement for their “fantastic job” and rapid response, describing the shooter as a “lone wolf” and “very sick person” from California who was armed with multiple weapons and charged a security checkpoint. He revealed that one Secret Service officer was shot at close range but was saved by his bulletproof vest and is “doing great,” while confirming the suspect was swiftly apprehended and taken into custody without harming any protectees. Trump noted he had “fought like hell to stay” at the dinner but deferred to security protocol, adding that the frightening event unexpectedly unified the ballroom and brought journalists and politicians together; he announced the White House Correspondents’ Dinner will be fully rescheduled within the next 30 days

This video was taken outside the venue: 

🚨🇺🇸 BREAKING: The suspect in the White House Correspondents' Dinner shooting has been identified as 31-year-old Cole Tomas Allen of Torrance, California.

-Video has emerged showing someone on the ground with U.S. Secret Service agents inside the Washington Hilton

-Believed to… https://t.co/EOkEIKYxj1 pic.twitter.com/PQoka3QLSR

— Mario Nawfal (@MarioNawfal) April 26, 2026

According to Fox News' Karol Markowicz, the suspect is a 31-year-old from Torrance, California. 

🚨🇺🇸BREAKING: The first image of the alleged shooter from the White House Correspondents' Dinner has emerged, showing a body on the stairs at the Washington Hilton surrounded by law enforcement.

Secret Service rushed Trump and other officials off the dais after gunfire erupted,… https://t.co/Y4xVaod1QP pic.twitter.com/YiVld5LUkV

— Mario Nawfal (@MarioNawfal) April 26, 2026

* * * Piss off a vegan...

Shots were fired during the 2026 White House Correspondents' Dinner (WHCD) at the Washington Hilton ballroom on Saturday evening, prompting the immediate evacuation of President Donald Trump, First Lady Melania Trump, Vice President, and other high-profile attendees by Secret Service. Guests were ordered to take cover under tables as heavily armed agents secured the venue.

BREAKING

The U.S. Secret Service just rushed the President and First Lady off the dais at the White House Correspondents’ Dinner after the sound of shots being fired was heard.

They have since reportedly been evacuated. pic.twitter.com/p3KihVun9A

— Yashar Ali 🐘 (@yashar) April 26, 2026

According to Deadline’s on-site reporter Ted Johnson, who was present in the ballroom near the area of the incident: “I heard what sounded like four shots, and it seemed to come from the hall just outside the ballroom near my table.”

Key details from initial reporting:

• President Trump and dignitaries—including the First Lady, Vice President, WHCA President Weijia Jiang, and entertainer/mentalist Oz Pearlman—were quickly hustled out of the ballroom.
• Secret Service agents jumped onto the stage amid the chaos.
• Education Secretary Linda McMahon’s security detail told CNN live that there was a shooter in the lobby and that the shooter is dead.
• A separate White House Pool Report from Jeff Mordock of the Washington Times stated that Secret Service indicated the alleged shooter is in custody - however CNN is reporting that the shooter is dead. the shooter is in custody. 

Attendees described loud noises (consistent with gunfire), panic, people ducking, the room being placed on lockdown, and police/Secret Service sweeping the hotel. Trump and the First Lady were reported safe after a rapid evacuation shortly after arriving at the event. No injuries to attendees or dignitaries have been confirmed in initial accounts.

Security officials evacuated Mike Johnson (R-LA) after a gunman opened fire during the White House Correspondents’ Dinner in Washington, D.C.

📸: @idreesali114 pic.twitter.com/tugjGlCPA4

— Breaking911 (@Breaking911) April 26, 2026

This was President Trump’s first appearance at the WHCD as sitting president (he had boycotted the event during his first term). The dinner is an annual black-tie affair organized by the White House Correspondents’ Association that traditionally features journalists, politicians, and celebrity guests.

More

A woman is detained by law enforcement outside the Washington Hilton pic.twitter.com/7WIXnFhdDf

— Brendan Gutenschwager (@BGOnTheScene) April 26, 2026

Erika Kirk spotted in tears leaving WHCD after gunshots: “I just want to go home.” pic.twitter.com/XeUlSZ2ZrT

— TheBlaze (@theblaze) April 26, 2026

The beast rushing to The White House after attempted assassination. pic.twitter.com/BuvG9J1ImJ

— The TRUMP PAGE 🇺🇸 (@MichaelDeLauzon) April 26, 2026

* * *

Tyler Durden Mon, 04/27/2026 - 07:00

Axon's Ukraine Drone Deals Signal Big U.S. Counter-UAS Push

Axon, formerly TASER International, has evolved beyond its roots as a police-tech vendor and is now positioning itself to soon be a major importer of drone and counter-drone technology after a series of deals with Ukrainian defense companies.

Axon currently sells hardware to local police forces, federal agencies, security, and military-adjacent markets. Some of this hardware includes Tasers, body-worn cameras, digital evidence systems, and AI voice companions, while the company's pivot is now moving toward battlefield-tested drone technology in Ukraine, which will likely be deployed here in the U.S.

Axon has made at least two Ukraine-linked defense-tech deals this year, both centered on drones, autonomy, ISR, and counter-UAS.

The first deal of the year, dated Feb. 17, was published in Kyiv Post:

The Fourth Law

Axon backed Kyiv-based The Fourth Law, a drone-autonomy firm developing AI modules for UAVs and interceptor drones. The investment amount was not disclosed. The funding is aimed at R&D for autonomy systems designed to counter Shahed-type drones and protect cities and critical infrastructure. Kyiv Post reported that The Fourth Law’s systems are used by more than 50 Ukrainian military units.

Then, in March, Kyiv Post reported another:

Buntar Aerospace

Axon led a $10.4 million funding round for Ukrainian drone developer Buntar Aerospace, alongside Norwegian investment consortium Munkene AS and other private investors. The deal includes a strategic partnership focused on commercial cooperation and technology integration around ISR capabilities. Buntar’s core product is the Buntar-3, an electric VTOL reconnaissance drone with up to four hours of flight time, plus mission-management software called Copilot.

Late last summer, executives at Axon met with Ukrainian drone manufacturers in Kyiv to propose a collaboration on countering drones.

Also, last year Axon acquired the Ukrainian company Dedrone for its AI-powered airspace security system, which safeguards large-scale events, airports, critical infrastructure, and even military bases against drones. 

Craig S. Smith of Eye on AI recently penned a note explaining how Ukraine has become "the world's AI weapons laboratory as the rise of drones, AI kill chains, and robots is being deployed and tested in what can only be described as a hyperdevelopment fashion. This allows combat-proven defense technology to flourish very quickly, and companies like Axon have understood that, in Ukraine's nonexistent capital markets, valuations for this technology are dirt cheap.

It's not just Axon sniffing around Ukraine for cheap war unicorn startups with proven battlefield-tested companies. There are numerous firms, from robotics to private equity, searching for these unicorns because they see the urgent need to bring this cheap counter-drone technology back to the U.S., where virtually every high-value asset, from data centers to power grids, has a missing layer of low-cost air defense against FPVs. 

As we've previously noted, the passive acoustics early-warning counter-drone space is about to heat up (read here).

Tyler Durden Mon, 04/27/2026 - 06:55

If The British Lose The Falkland Islands It Will Be Their Own Fault

This month, after four years of tensions between Europe and Russia, the Russian Navy executed an operation in the North Atlantic on the doorstep of British waters.  Using an Akula-Class nuclear submarine as a decoy, the Russians sent covert spy subs to map underwater infrastructure, including vulnerable internet cables and pipelines. 

Given the precarious nature of the war in Ukraine, the Russian action is being called "brazen" by European leaders.  Critics argue, though, that the Russians only carried out the operation because they feel they have little to fear from the Royal Navy. 

This problem was further exposed when Iranian missiles and drones targeted multiple British bases in March after the initial start of the war.  Kier Starmer sent only one vessel (the HMS Dragon) for air defense, and this ship was then called back in April for maintenance.  The military response by the British was called "pathetic" by many who expected at least a rudimentary naval presence for security. 

Europe's "hands off" policy in the Strait of Hormuz aside, it is becoming clear that these countries could not field an adequate and functional fleet even if they wanted to.  In fact, their apprehensions about helping to secure the strait under NATO might be, in part, a result of their fear of being discovered as militarily impotent.  

These recent events and others have led the Trump Administration to question the purpose of a NATO alliance that has nothing to offer and relies almost completely on the US military as a deterrent (or shield) in the face of a wider war.  This lack of faith in Europe (including Britain) has bled into orbiting issues, including the Falkland Islands.

Argentine President and Trump ally Javier Milei has launched a new effort to claim control of the Falkland Islands, reigniting a long-standing dispute with the United Kingdom over the archipelago, which once led to war.   

"The Malvinas were, are, and always will be Argentine,” Milei said on X in Spanish on Friday, using the Argentine name for the islands.  In a separate interview with the Argentine digital channel Neura, Milei said that the country was doing “everything humanly possible” to return the Falklands to Argentina. 

LAS MALVINAS FUERON, SON Y SIEMPRE SERÁN ARGENTINAS.
VLLC! https://t.co/frox4fn03r

— Javier Milei (@JMilei) April 24, 2026

The US has always been "officially neutral" on the Falklands, but leaned in favor of British control for decades.  The British media has recently accused Trump of shifting to the Argentinian side and asserting that he might be "plotting" to help Millei reacquire the islands. 

This claim comes from a leaked policy memo from Trump advisers about a possible "reassessment" of the US position on the Falklands.  It had nothing to do with any statements made by the White House.  The media has blown the story up into a tale of betrayal by the Trump Administration against his British friends. 

At bottom, if the President did change the US stance on the Falkland Islands, it would likely be to become truly neutral instead of simply pretending to be neutral.  In other words, if Argentina wanted to take the islands, the US would not intervene.  And, evidence suggests that if this happened the British would not be able to do much about it. 

Currently, the Royal Navy has only 63 active vessels in its fleet (compare this to nearly 300 active vessels in the US navy).  That said, the word "active" is misleading.  At any given time, over 50% of British vessels are under repair or in dry dock, which means they only have 20-30 ships ready to fight under current conditions (high readiness).  Strategic assessments indicate that Britain would need all of these vessels to go to war with Argentina and guard their interests in the Falklands. 

Today, the British have only one patrol ship in the area (the HMS Medway).   

Ultimately, Britain's lack of military readiness and their ongoing hostility towards the Trump Administration has created conditions in which they could lose the very territory they fought to keep in 1982.  During that war, the British (and the UK) relied on extensive US intel and logistical support.  Now, that support is gone and their navy is much smaller and less effective (the Royal Navy task force sent to secure the islands in 1982 had 127 ships).     

If they lose the Falkands today, they will only have themselves to blame.  

Tyler Durden Mon, 04/27/2026 - 05:45

Outrage As Taliban Afghan Illegal Who Sexually Assaulted 7-Year-Old Gets Just 2.5 Years In Prison

Authored by Steve Watson via Modernity.news,

An Afghan small boat migrant with admitted ties to the Taliban kidnapped and sexually assaulted a seven-year-old girl inside a taxpayer-funded hotel – and a UK court has handed him just two and a half years in prison.

This is the direct result of open borders policies that continue to flood Britain with unvetted arrivals who bring incompatible cultural attitudes and a total disregard for the safety of local communities.

The attack took place in September at a Government-funded hotel in Acton, West London. Afsar Safi, 30, enticed the child away from her mother using an apple before forcibly pulling her along a corridor by the arm and taking her to his room, where he carried out the sexual assault. The girl escaped after alerting security staff.

Small boat migrant who kidnapped and sexually assaulted girl, 7, in hotel worked for Talibanhttps://t.co/72rQ8F9mQx

— GB News (@GBNEWS) April 25, 2026

Safi crossed the Channel illegally in 2021. His own asylum paperwork stated he had been associated with the Taliban since the age of ten. That application has been rejected and he is appealing the decision.

During sentencing at Isleworth Crown Court, Safi explained his actions through a Pashto interpreter.

“I like children and she was a child,” he said, adding “I asked her where she was going. She said she was waiting for her mother to go shopping.”

He then admitted, “I kissed her to the face. I kissed her out of the love for children. Back home, all the people do that.”

Yeah, tell us about it.

The seven-year-old victim gave harrowing evidence to the jury.

“I could not tell him to go away because I was too scared,” she told the court, adding “He put his arms around me. It feels like he’s coming after me all the time. My nightmares feel like they are real, so I cry sometimes.”

Safi was convicted of kidnapping and sexual assault. The judge sentenced him to just two and a half years in prison and ordered him placed on the sex offenders register for seven years. He could be released on licence in as little as six months.

This is not an isolated incident. It is the predictable outcome of a system that prioritises housing illegal arrivals in hotels and now quietly disperses them into communities without proper vetting or local consent.

As the Daily Mail today notes, the Labour government is secretly moving hundreds of migrants, including Afghans, into picturesque villages across the country. In one Surrey village, locals only discovered the policy when an Afghan man in his twenties began loitering at the school gates and harassing girls.

What do they hope to achieve by plopping sets of 100 Afghans into tiny countryside villages where 97% are white upper and upper middle class English people? It’s almost like they want to cause the most culture shock possible. https://t.co/qRxhjKsVK8

— m o d e r n i t y (@ModernityNews) April 25, 2026

Meanwhile, just days ago three asylum seekers were found guilty of the callous rape of a woman on Brighton beach after finding her staggering alone in the street.

BREAKING: Three asylum seekers have been found guilty over the rape of a woman on Brighton beach.

The woman was separated from her friends on a night out when the trio found her "staggering in the street" alone, Hove Crown Court heard.https://t.co/CR7vCNbRiv

📺 Sky 501/YT pic.twitter.com/kivh5FUIsZ

— Sky News (@SkyNews) April 23, 2026

This pattern repeats because the government refuses to secure the borders, deport failed claimants, or put British citizens first. Taxpayers foot the bill for hotel accommodation while communities bear the real cost in safety and social cohesion.

The message from these cases is unmistakable. Unchecked mass immigration from cultures with vastly different standards on child protection and women’s safety is not “compassion.” It is a reckless gamble with the lives of the most vulnerable.

Britain needs a commons sense border policy that ends the small boat invasion, removes those with terrorist links, and stops the dispersal of unvetted migrants into our villages and towns. Anything less leaves more children at risk.

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

Tyler Durden Mon, 04/27/2026 - 05:00

"The Dynamic Has Shifted": Global Automakers Now Bet Heavily On China For Global Expansion Strategies

Foreign automakers are rushing to debut China-developed models at a major auto show, recognizing they can’t afford to lose ground in the world’s largest car market, according to Nikkei.

After years of declining sales, many legacy brands are shifting to an “in China, for global” strategy—using local innovation not just to regain domestic customers, but to compete abroad.

Companies like Volkswagen and Nissan are leaning heavily on Chinese partnerships to accelerate development and integrate advanced tech.

Volkswagen, for instance, is working with Xpeng and Horizon Robotics to build software-driven vehicles and unveiled several new models at the Beijing auto show. It plans to launch over 20 EVs in China this year and up to 50 by 2030. Still, its sales dropped 14.9% in Q1, and it now expects lower long-term volumes. As one executive put it, “The era of super-returns is over.”

Despite setbacks, China has become a source of efficiency. Volkswagen says it has cut EV development time by 30% and slashed some production costs by half. CEO Oliver Blume noted that the country’s rapid innovation “... we can carry over to other processes around the world.” The company is also expanding exports of China-built cars to regions like Asia-Pacific and South America.

Nissan is pursuing a similar “in China, for China, to global” approach, aiming to absorb local technology and turn China into an export hub. CEO Ivan Espinosa emphasized: “The technology, the speed and the cost that we have achieved in the China ecosystem can play a very important role for us.” New models and collaborations have helped Nissan’s China sales rebound, and it plans to export more vehicles globally.

The Nikkei report says that other automakers are following suit. Honda has begun selling a China-made EV in Japan, while Hyundai is expanding local partnerships and model offerings. Even Peugeot and Citroen have returned to Chinese auto shows, signaling renewed commitment.

The broader shift reflects a reversal of roles in the global auto industry. As one analyst observed, “Thirty years ago, Western automakers entered China as teachers… Today, that dynamic has fundamentally shifted.”

Tyler Durden Mon, 04/27/2026 - 04:15

US Has No Plan To Renew Iranian, Russian Oil Waivers, Bessent Says

Authored by Kimberley Hayek via The Epoch Times,

U.S. Treasury Secretary Scott Bessent said on April 24 that the United States will not renew the sanctions waivers that enabled buyers to take delivery of Iranian and Russian crude already loaded on tankers at sea.

Bessent said a one-time license covering Iranian oil on the water would not be extended, calling it “totally off the table.” The parallel waiver for Russian oil and petroleum products will also be allowed to end, he said.

“We will not be renewing the general license on Russian oil, and we will not be renewing the general license on Iranian oil,” Bessent said. “That was oil that was on the water prior to March 11. So all that has been used.”

The Treasury Department’s Office of Foreign Assets Control (OFAC) also on Friday sanctioned Hengli Petrochemical (Dalian) Refinery Co., a Chinese plant that can process roughly 400,000 barrels a day.

“Hengli has played an outsized role in purchasing crude oil from Iran’s armed forces,” the Treasury said in a statement.

The OFAC also sanctioned approximately 40 shipping companies and tankers connected to Iran’s so-called shadow fleet.

The action was executed under Executive Order 13902 and President Donald Trump’s National Security Presidential Memorandum 2, the framework for the White House’s “maximum pressure” campaign.

“Treasury will continue to constrict the network of vessels, intermediaries and buyers Iran relies on to move its oil to global markets,” Bessent said in the Treasury statement.

On Friday, Bessent also disclosed the seizure of about $344 million in cryptocurrency held in crypto wallets the government has tied to Tehran.

“We will follow the money that Tehran is desperately attempting to move outside of the country and target all financial lifelines tied to the regime,” Bessent said.

Blockchain analysts cited in the report tied some of the wallets to the Central Bank of Iran and to Iranian cryptocurrency exchanges.

Bessent predicted earlier in the week that Iran’s oil sector was close to collapse. He said Kharg Island, the terminal that handles nearly 90 percent of Iran’s crude exports, would run out of storage “in a matter of days,” meaning producers had to shut in fragile wells that are hard and costly to restart.

“Constraining Iran’s maritime trade directly targets the regime’s primary revenue lifelines,” he said.

Bessent said on Wednesday that the maritime oil waivers covering both countries had been quietly extended for another 30 days, noting that at the spring meetings of the World Bank and the International Monetary Fund, “more than 10 of the most vulnerable and poorest countries” had pleaded for relief as crude prices rose past $100 a barrel.

That extension was executed via OFAC General License 134B, issued April 17, authorizing wind-down transactions involving Russian crude and petroleum products put on vessels by that date. The license is set to expire on May 16. It replaced an earlier authorization that ran out on April 11.

The original waiver, issued in March after the U.S.–Israeli war with Iran led to the closure of the Strait of Hormuz and a squeeze on global supply, was designed to keep barrels already at sea moving and calm jittery markets.

Bessent said that the administration is also ready to employ secondary sanctions against any country or bank that purchases Iranian oil or holds Iranian funds, noting that it is “a very stern measure.” He said pressure will next be placed on the banks and refiners still conducting business with Tehran.

Tyler Durden Mon, 04/27/2026 - 03:30

Where Does Eastern Europe Begin And End? Key Takeaways

• There is no single definition of Eastern Europe. Its borders vary depending on historical, political, and cultural context.
• Russia, Ukraine, and Belarus are almost always included, forming the region’s “core.”
• The eastern boundary is widely agreed upon, but the western edge shifts significantly across definitions.

The maps below use data from various organizations to highlight interpretations of Eastern Europe’s geographical extent.

At a glance, the visualizations - via Visual Capitalist - show a tight core centered on Russia, Ukraine, and Belarus, with boundaries stretching eastward into Russia and stopping along a debated western frontier that cuts through Central Europe.

Eastern Europe’s Borders, Defined

Below are major groupings from the UN, CIA World Factbook, StAGN (Germany’s committee on geographical names), and The European Correspondent, the creator of the map.

 

A Region Defined by Perspective

 

Unlike continents or countries, Eastern Europe is not a fixed geographic entity. Instead, its definition has evolved over time, shaped by empires, ideology, and institutions. According to various modern definitions, the region can include anywhere from a handful of countries to over a dozen.

Historically, the term gained prominence during the Cold War, when it often referred to Soviet-aligned nations. This political framing still influences perceptions today.

The Core vs. the Fringe

Despite disagreements, some countries are almost always included:

• 🇷🇺 Russia
• 🇺🇦 Ukraine
• 🇧🇾 Belarus

These nations form the “core” of Eastern Europe across most academic and institutional definitions. Beyond them, the picture becomes less clear. Countries like Poland, Hungary, and the Czech Republic are sometimes included, but are often classified as Central Europe instead.

Research from institutions like the University of Basel highlights how these shifting classifications reflect cultural identity as much as geography.

How Far Does It Stretch?

At its maximum extent, Eastern Europe can span from Germany’s eastern border all the way to the Ural Mountains in Russia. This broader definition may include the Balkans and parts of Central Europe.

At its minimum, however, the region shrinks to just a few countries in Eastern Slavic territory. That these narrower definitions often reflect cultural or linguistic commonalities.

Ultimately, where Eastern Europe “begins” and “ends” depends on who you ask, which makes it less of a place on a map and more of an idea shaped by history and geopolitics.

Tyler Durden Mon, 04/27/2026 - 02:45

Reset Germany: Breaking With An Exhausted Ruling Class

Authored by Frank-Christian Hansel via American Greatness,

Germany is not, in the first place, suffering from an economic crisis, an energy crisis, a migration crisis, or a crisis of state. Germany is suffering, chiefly, from a crisis of its elites.

More precisely, Germany is suffering from a crisis brought on by that milieu which regards itself as the country’s morally, intellectually, and administratively legitimate leadership class but which has, for years, sustained a regime of reality-avoidance, self-congratulation, and rhetorical substitutes for genuine action.

The misery of our situation is not that mistakes have been made. Mistakes are part of politics. The real misery is that Germany has produced a class of managerial elites that refuses to change course even when the consequences of its actions lie plainly exposed. That class does not correct itself, because it no longer measures itself against reality; rather, it measures itself against the approval of its own circles. It does not want to be right before the tribunal of reality; it wants to be right before the tribunal supplied by its own milieu.

That is the root of Germany’s decline.

The Federal Republic was once—for all its flaws—a country that drew its strength from a peculiar mixture of sobriety, an ethic of performance, technical reason, institutional discipline, and bourgeois self-restraint. This country was not great through pathos but through seriousness, not through visions but through reliability, and not through moral grandstanding but through quiet competence. That was precisely why it was strong: because it had the capacity to concentrate on what was necessary, instead of losing itself in what was desirable.

Of that Germany, little remains inside the ruling apparatus.

In place of prosaic sobriety, a political-media class has emerged that mistakes governing for pedagogical world-improvement. Its first instinct is no longer to secure, to enable, and to set limits. Its first instinct is to educate, to frame, to therapize, to reinterpret, and to morally cultivate. Its relationship to the citizen is no longer republican; it is curatorial. The citizen no longer appears to this class as the sovereign on whose behalf it works—as Helmut Schmidt once understood the office—but as a problem case: too skeptical, too stubborn, too set in his ways, and too interested in normality, safety, and prosperity.

This is where the real cultural rupture becomes visible.

Germany’s elites no longer distrust merely particular political positions. They distrust ordinary life itself. The desire for normality, the desire for affordable energy, the desire for borders, the desire for safety in public space, the desire for cultural continuity—the desire, in short, that a state should first be obligated to its own—all of this is held in the upper reaches of society to be suspect, unpleasantly banal, and morally backward.

A paradoxical situation has emerged: the more obvious the functional failures of the state, the louder the moral self-celebration of its representatives. The thinner the substance of the country, the more clamorous the professions of stance, diversity, transformation, and responsibility—with the federal president, at the top of the hierarchy, leading the chorus.

We live, accordingly, in a state that announces ever more and delivers ever less. Politics that indulges in historical sermonizing while failing at train stations, borders, schools, the electricity grid, housing, the Bundeswehr, public administration, and internal security—an elite that cloaks its own barrenness with the claim that it, at least, stands on the right side of history. That formula is the real total loss.

For whoever believes himself to be on the right side of history ceases to answer to the present. He replaces examination with conviction, outcomes with intentions, and reality with narrative. From this posture comes the mixture of hypermoralism and state failure that characterizes Germany today. They speak of humanity and lose control of migration. They speak of responsibility and destroy the energy foundations of our industry. They babble about worldly openness and ask us to tolerate the degradation of public spaces. They speak of democracy and exclude millions of voters. They take the word “diversity” in their mouths and drive cultural estrangement in their own country.

This is not accidental. It follows a deeper logic. Those who rule the Federal Republic today have grown accustomed to drawing legitimacy not from performance but from moral elevation. They no longer govern out of their own solidity but out of symbolic self-immunization. Whoever objects is not treated as an opponent but as a disturbance. Whoever points to the limits of what a society can bear is not treated as a realist but as a suspect case. Whoever invokes people, nations, cultural inheritance, sovereignty, or self-interest is not tested argumentatively but ritually delegitimized.

Which is exactly why the opposition in Germany today is, at its core, not simply one more party among others. It is, apart from its internal difficulties and the external attacks against it, the political expression of a surviving cast of mind in this country.

A surviving cast of realism, of the will to self-assertion, and of a sense for reality. It is the form in which Germany still articulates itself politically: the Germany that is not yet willing to let itself be parted from its history, its cultural identity, its industrial reason, and its claim to the normality of the state. We can say it plainly: yes, we are bourgeois dissidents.

This also explains the frenzied state of mind of the establishment. We are not opposed so bitterly because we are irrelevant. We are opposed so bitterly because we touch exactly the point that the ruling cartel must conceal at any cost: that the decline is not fated, but politically engineered; that the crisis does not come from the voters, but from the leadership classes; and that the real scandal lies not in the protest, but in the necessity of the protest—in the necessity of dissent itself.

What has exhausted itself in Germany is not merely a government or a coalition. It is the whole style of governing: a style that dissolves all limits and manages everything at once; that relativizes every binding and sanctions every deviation; that treats national self-assertion as indecent and state overreach as progressive; that subordinates economic reason to climate, legal clarity to a false morality, cultural self-respect to a pedagogy of guilt, and democratic equality to the political firewall. This model is depleted. It has no answer left to reality except to impose further demands on those it governs.

It has, ultimately, no future.

What Germany needs, therefore, is not merely a change of policy. It needs a mental restart—a return to Go—so that a true reset becomes possible. Every renewal begins with a reset. Not with grand programs, but with a rediscovery of what is real. A country must know again who it is before it can decide where it wants to go. It must stop despising itself morally before it can become politically capable of action again. That is where the real task lies.

Germany must—we must—free ourselves from our exhausted elites. Not only in terms of personnel, but also mentally and spiritually. We must find our way back to a politics that distinguishes between one’s own and the foreign, between responsibility and posture, between freedom and paternalism. We must remember that the purpose of a state is not to redeem the world but to protect its own political community. And that a nation which loses the will to self-assertion will, in the end, lose its capacity for freedom as well.

The German reset will therefore not come from the centers of today’s operations. Not from the party apparatuses, not from the editorial offices, not from the committees of a class that is blind to its own failures and seeks refuge in haughty notions of moral superiority. The reset and restart can only come from those places where something of the country’s sense of reality still remains intact: where decline is not celebrated as transformation, where the normal is not dismissed as reactionary, and where Germany is not regarded as a problem but as a task.

That surviving cast of mind, on which the reset depends, still exists. But it is not infinitely resilient.

The question, therefore, is not whether this country needs a rupture. The question is whether that rupture will be organized politically in time—or whether Germany must first pass still deeper through the exhaustion zones of its old elites. In this situation, the opposition is not merely an opposition party. It is the only political force that understands the necessary rupture not as a breakdown to be managed, but as the precondition of renewal.

Whoever truly wants to restart Germany must first have the courage to stop treating this country‘s elite misery as its fate. It was done. And what was done can be undone.

Tyler Durden Mon, 04/27/2026 - 02:00

Hayek, Orwell, And 'The End Of Truth'

Authored by Jonathan Miltimore via Civitas Institute,

In 1942, after fighting in the Spanish Civil War (1936–1937), a disillusioned writer returned to London to write about his experience. It wasn’t just that the fascists in Spain had won and his side—a small, anti-Stalinist Marxist group—had lost. What frightened him was the ease with which truth itself had been erased and replaced by propaganda.

“I saw great battles reported where there had been no fighting, and complete silence where hundreds of men had been killed. I saw troops who had fought bravely denounced as cowards and traitors, and others who had never seen a shot fired hailed as the heroes of imaginary victories ... and I saw newspapers in London retailing these lies and eager intellectuals building emotional superstructures over events that had never happened.”

The writer was George Orwell, and the quote appears in his book “Looking Back on the Spanish Civil War.”

The disconnect between reality and narrative clearly made an impression on Orwell, who worried that “the very concept of objective truth is fading out of the world.” The theme of falsified history and the destruction of truth would resurface in his fictional masterpiece “Nineteen Eighty‑Four,” where “memory holes” swallowed inconvenient facts and the past was rewritten to suit the Party’s needs.

Orwell’s book would go on to sell 25 million copies worldwide, and he is today remembered as a prophet for foreseeing a future in which the state’s deliberate power could extinguish truth itself.

Yet few today remember that five years before the publication of “Nineteen Eighty‑Four,” an Austrian economist, in his own magnum opus, explored how the state destroys truth.

Management of Minds

Unlike George Orwell, Friedrich Hayek (1899–1992) is not a household name, but his 1944 classic “The Road to Serfdom” made him one of the twentieth century’s most influential thinkers—despite the book’s inauspicious beginning.

Originally a memo penned at the London School of Economics, “The Road to Serfdom” was rejected by three publishers before finding a home with Routledge. The first run—2,000 copies—sold out in 10 days. Hayek’s book went on to sell more than two million copies and be translated into over twenty languages. Its core argument was straightforward: central planning, however well-intentioned, erodes individual freedom and sets society on a path toward serfdom.

What is often overlooked is Hayek’s deeper insight. Economic control does not remain confined to the economy. Once the state directs production and prices, it inevitably reaches into thought, expression, and belief. For Hayek, the danger of socialism was not only material impoverishment—as seen in the USSR—but the steady expansion of intellectual control.

“... It is not enough that everybody should be forced to work for the same ends,” Hayek wrote. “It is essential that people should come to regard them as their own ends.”

Hayek was warning that once the state begins to manage prices and production, it will soon find it necessary to manage minds. When a government takes control over economic life, it must “justify its decisions to the people” and “make people believe that they are the right decisions.”

In doing so, it inevitably begins to decide which opinions and values align with its plan—rewarding and amplifying voices that comply while punishing, suppressing, and silencing those that do not.

‘The End of Truth’

The quotes above appear in Chapter 11 of “Serfdom,” aptly titled “The End of Truth.”

When I first read the book twenty years ago, the chapter didn’t stand out to me. Today it does. After all, we recently lived through a period in which the phenomenon Hayek described played out before our eyes.

The COVID-19 pandemic was a vast economic experiment. The federal government issued a wide array of public health “recommendations” that soon became dogmas. To question the efficacy of masks or social distancing—a policy we learned in 2024 had no basis in science—was to risk being censored or accused of spreading “misinformation.” Scientific debate gave way to official decree, and many who questioned “the plan” or resisted it lost their jobs or were booted from platforms.

None of this would have surprised Hayek, who warned that the plans constructed by central planners must be “sacrosanct and exempt from criticism.”

“If the people are to support the common effort without hesitation, they must be convinced that not only the end aimed at but also the means chosen are the right ones,” he wrote. “Public criticism or even expressions of doubts must be suppressed because they tend to weaken public support.”

Hayek’s chapter is not primarily about censorship. Instead, he argues that the rise of state power will systematically undermine the concept of truth itself and the human pursuit of it.

As governments assert control over economic and social life, facts and evidence are subordinated to political goals—an idea Orwell illustrated vividly when the Party refused to accept Winston Smith’s claim that two plus two equals four.

‘Sometimes, Winston...’

The phenomenon Orwell described was not moral relativism but factual relativism. It was a theme Hayek also addressed. The Austrian economist noted that in totalitarian systems, even basic facts—including mathematics—become subservient to state dogma. He reminded readers that in the USSR and Nazi Germany, ideology had consumed even the sciences. There was “German Physics” and a “Marxist-Leninist theory in surgery.”

“It is entirely in keeping with the whole spirit of totalitarianism that it condemns any human activity done for its own sake and without ulterior purpose,” he wrote. “Science for science’s sake, art for art’s sake, are equally abhorrent to the Nazis, our socialist intellectuals, and the communists.”

Hayek observed that as the state’s power grows, the sciences become corrupted. Instead of advancing truth, they become tools in the hands of planners.

“Once science has to serve, not truth, but the interest of a class, a community, or a state,” he wrote, “the sole task of argument and discussion is to vindicate and to spread still further the beliefs by which the whole life of the community is directed.”

Hayek said the phenomenon he described was most pronounced in dictatorships, but he added that it was not “peculiar to totalitarianism.” Even in free societies, he warned, “the most intelligent and independent people cannot entirely escape [the] influence” of state propaganda. His point was unsettling: susceptibility to propaganda is not limited to the gullible or uninformed—propaganda ensnares the thoughtful and educated as well.

The erosion of truth becomes apparent through a decay in language. Words like “freedom,” “right,” “equality,” and “justice” lose their meaning. Eventually, the word “truth” itself “ceases to have its old meaning.”

“It describes no longer something to be found,” Hayek wrote, “it becomes something to be laid down by authority—something which has to be believed in the interest of unity of the organized effort, and which may have to be altered as the exigencies of this organized effort require it.” (emphasis added)

All of this sounds familiar to readers of “Nineteen Eighty-Four,” who see Winston Smith struggling to hold onto objective truth in a world where truth is dictated by power. Surely two plus two equals four, he pleads.

“Sometimes, Winston. Sometimes they are five,” he is told in the Ministry of Love. “Sometimes they are three. Sometimes they are all of them at once. You must try harder.”

‘The Tragedy of Collectivist Thought’

Orwell was a master, and “Nineteen Eighty-Four” is a masterpiece. But Hayek was describing Orwellianism several years before Orwell gave it fictional form. (It’s also worth noting that G.K. Chesterton used the “two plus two equals four” blasphemy metaphor nearly a half-century before Orwell.)

This doesn’t diminish Orwell’s work. On the contrary, it shows how powerfully he dramatized ideas that Hayek had already diagnosed in theory. (Orwell, it should be noted, read “The Road to Serfdom” and enjoyed it, with caveats.)

Still, Hayek deserves credit for superbly articulating—in one chapter!—the phenomenon that Orwell would translate into a terrifying warning, one that millions of junior high and high school students would receive in English courses.

The economist Daniel Klein recently called “The End of Truth” the most important chapter in Hayek’s most important work. I couldn’t agree more. The chapter serves as a reminder that the human mind is not something to be controlled but something to be unleashed. If we forget this simple lesson, we risk surrendering the very capacity for independent thought that sustains civilization.

“The tragedy of collectivist thought,” he noted, “is that, while it starts out to make reason supreme, it ends by destroying reason because it misconceives the process on which the growth of reason depends.”

Tyler Durden Sun, 04/26/2026 - 23:50

Compute Costs More Than Talent In AI

For leading AI companies, the biggest expense is not talent. It is compute.

This chart from Visual Capitalist’s AI Week, sponsored by Terzo, uses Epoch AI data to compare spending at Anthropic, Minimax, and Z.ai across R&D compute, inference compute, and staff plus other costs.

In every case, compute accounts for the majority of total spending, underscoring how capital-intensive it has become to build and serve frontier AI models.

How AI Company Costs Break Down

Despite differences in scale, all three companies allocate the largest share of their budgets to a single category: compute.

The data below compares spending composition across Anthropic, Minimax, and Z.ai. Anthropic’s figures are for 2025, while Minimax’s are from Q1 to Q3 of 2025 and Z.ai’s are for H1 2025.

Across all three AI companies, compute is the main cost center. Epoch AI estimates that R&D compute and inference compute together account for 57% to 70% of total spending, making infrastructure more expensive than staff and other costs in every case.

Among the three, Z.ai has the most R&D-heavy profile, with 58% of spending tied to compute powering model development and training.

Anthropic stands out for sheer scale. Epoch AI estimates the company spent $9.7 billion in 2025, including $6.8 billion on compute alone across training and inference.

Its costs are significantly higher than Minimax’s and Z.ai’s, even if the two Chinese AI companies’ figures were annualized to match Anthropic’s full-year period.

Both Chinese companies release many of their models as open source, meaning the model weights are freely available for anyone to download, modify, and run. This strategy helps them compete with better-funded U.S. labs by building developer adoption at a fraction of the cost.

AI Talent Costs Less Than Chips and Compute

One of the clearest takeaways is that talent costs less than compute in this comparison. Even though top AI labs pay some of the highest salaries in tech, staff and other costs still account for less than half of total spending at each of the three firms.

While the chart focuses on costs, Epoch AI estimates these labs are currently spending around 2–3x more than they generate in revenue, even as some expect economics to improve over time.

How These Estimates Were Built

This dataset comes with a few important caveats. Anthropic’s figures are based on reporting from The Information and are more speculative, while Minimax and Z.ai figures come from IPO filings released in January 2026.

The time periods also differ: Anthropic data is for the full year of 2025, Minimax covers 2025 Q1–Q3, and Z.ai covers 2025 H1. Epoch AI says its expense totals include operating expenses, cost of goods and services, and non-cash items such as stock-based compensation.

If you enjoyed today’s post, check out The Soaring Revenues of AI Companies on Voronoi.

Tyler Durden Sun, 04/26/2026 - 23:25

Charlottesville: The Deceit Underlying The Hoax

Authored by Steve Cortes via RealClearPolitics.com,

For years, Democratic politicians and their allies in the legacy media have spread the damnable Charlottesville Hoax: the propaganda myth that President Trump praised bigots who rioted in 2017 in the Virginia town.

Of course, the opposite is true, as Trump actually said: “I’m not talking about the neo-Nazis and white nationalists because they should be condemned totally.”

Now, we learn that the entire hoax of Trump and Charlottesville is, itself, built upon another grand lie. The media and people like Joe Biden have continually pushed the narrative that some big, organic gathering of hateful Americans descended upon Charlottesville and represented some larger threat to the republic itself. But it now turns out that the “Unite the Right” rally was organized and financed by the highly partisan, left-wing Southern Poverty Law Center.

In a sweeping 11-count indictment, the Department of Justice and acting Attorney General Todd Blanche charge the advocacy group with criminal defrauding of donors and “manufacturing the extremism it purports to oppose by paying sources to stoke racial hatred.”

The charges contained in this indictment are akin to the fire department becoming an aggressive criminal arson enterprise, setting fires all across a town, and then demanding more budget and authority to fight the very infernos it set ablaze.

So…the end result is that America endured years of propaganda that convinced a large segment of the population – in contravention of the facts – that their president supported violent hate merchants. Even worse, masses of unskeptical Americans, who consume only legacy media content, believed that the entire America First populist movement was based on bigotry, rather than patriotism.

Now, nearly a decade later, the truth is revealed about the deception that lay beneath that grand lie. There was a layer of duplicity here that is almost difficult to fathom. Only true Marxists could excuse this level of propaganda. The SPLC created hate groups and activities like the Charlottesville rally, and the complicit media then weaponized these concocted offenses by spreading outright lies about Trump’s reaction to the staged events.

I myself played a role in this saga regarding Charlottesville, best explained by a timeline:

March 2019 – After more than a year serving as a contributor on CNN, I grew tired of the near-nightly lies told about Charlottesville during the primetime hits when I was on-air. I tried my best to debunk the myth, but was routinely shouted down, and even “benched” for short periods for daring to tell the truth. So…I wrote a column at RealClearPolitics with the exact Trump transcript and precise citations.

April 2019 – Joe Biden launched his 2020 presidential campaign based entirely upon the Charlottesville lie, claiming that the “bulging veins” of the racists convinced him to run for the White House.

August 2019 – Dennis Prager had read my RealClearPolitics article and had me on his radio show repeatedly to discuss what we branded as the “Charlottesville Hoax.” He also asked me to narrate a five-minute video for his online platform, PragerU, debunking the hoax, which went mega-viral, with well over 10 million total views.

September 2019 – CNN removed me from the air. Rebecca Kutler, now the head of MSNOW and then the director of talent at CNN, expressly told me that the permanent “benching” was because of the Charlottesville video, even though I was clearly allowed to make such online videos, per the terms of my contract. I asked to be released so that I could do TV elsewhere, and she refused. In other words, they paid me to be silent, to stay on the sidelines.

December 2019 – I was released from CNN.

June 2024 – Supposedly objective “fact-checking” site Snopes finally admits the clear reality of the full transcripts and video evidence that Trump never praised bigots at Charlottesville.

April 2026 – The Southern Poverty Law Center was indicted for millions of dollars in secret payments to racists to foment and organize racial unrest and events, including the Charlottesville event itself.

This entire sad saga matters.

• First, it unveils the systemic duplicity of the left in America. Because their demand for “hate” far exceeds the actual supply, they had to pay to manufacture bigotry, so that they then could oppose it.

• Second, the record reveals that lies build upon lies, while the truth remains, inherently, emancipating.

Whatever any citizen thinks of Donald Trump, the entire madness of Charlottesville represents a preventable and despicable tragedy. The actions of the SPLC were criminal and mafia-like. A young woman, Heather Heyer, lost her life because of this mayhem. More broadly, millions of Americans bought into an insidious lie and believed it for years, doing grave damage to the cohesion of our society.

Only a full accounting, now, can begin the process of healing and truth-telling.

Tyler Durden Sun, 04/26/2026 - 23:00

Futures Jump To Record High After Report Iran Offered New Non-Starter Proposal To Reopen Strait

Update (10:30pm): Just when it seemed that the market may have its first red Monday in a while - and the semiconductor bubble may actually have a down day after a ridiculous 18 day streak higher - the Trump-Axios plunge protection team struck again, and courtesy of Axios' in-house market levitator, Barak Ravid, whose specialty is creating cheerful market narratives to preserve faith that the Strait of Hormuz will open any second now, coupled with a few strategically timed flashing red headlines from Bloomberg, futures surged to a new record high, and oil pared after Axios reported that Iran offered the US a new proposal to reopen the Strait of Hormuz. 

🚨President Trump is expected to hold on Monday a situation room meeting on Iran with his top national security and foreign policy team
🚨The meeting is expected to discuss the current stalemate in the negotiations with Iran and potential options for the next steps in the war https://t.co/nevd1SjWhd

— Barak Ravid (@BarakRavid) April 27, 2026

According to the report, which is a rerun of news which hit about 12 hours earlier on Sunday, Axios ran earlier in the day but which no algos noticed, Iran - through Pakistani mediators - gave the Trump admin a new proposal for reaching a deal on the reopening of the Strait of Hormuz and the ending of the war, however with nuclear negotiations postponed for a later stage, something which Trump has repeatedly said is a non-started. 

According to Ravid, the new proposal is aimed at overcoming the current stalemate in the talks and bypass the internal disagreements in the Iranian leadership about the scope of nuclear concessions it is willing to give in order to get a deal with the Trump administration. Meanwhile, the report is meant to eliminate the bitter taste in the market's mouth from yet another weekend where there was zero progress on either peace, of extending the ceasefire, or certainly on unblocking Hormuz. So it was time to sprinkle an anonymous US official and two anonymous "sources with knowledge" to kickstart the market meltup. As for the actual "proposal" even Axios admits it is unlikely to make any impact:

But reaching a deal on the Strait of Hormuz first and lifting the U.S. blockade would leave President Trump with no real leverage in order to get Tehran to give up on its stockpile of enriched uranium and commit to a suspension of uranium enrichment for at least a decade.

Addressing those two nuclear concerns through military action or diplomacy are a key objective for Trump in the war against Iran.

Which is precisely why nothing will happen, but at least stocks will now levitate higher instead of drifting lower. 

Sure enough, Asian shares rose 1.3% while MSCI’s emerging markets index hit a record high, as easing oil prices help curb inflation and support economic growth. As sentiment improved, US equity-index futures erased earlier losses to rise 0.1%. The Bloomberg Dollar Spot Index erased earlier gains and fell 0.1% after the report.

“The news aligns with market expectations that Iran and the United States would eventually reach an agreement,” said Yugo Tsuboi, chief strategist at Daiwa Securities Co. “The headline came at a good time as we head into peak earnings season.” Of course, the Trump admin is well aware of that. 

Separately, Axios reported, citing the usual group of "anonymous sources", that Trump is expected to hold on Monday a situation room meeting on Iran with his top national security and foreign policy team. The meeting is expected to discuss the current stalemate in the negotiations with Iran and potential options for the next steps in the war.

Trump signaled in an interview with Fox News on Sunday that he wants to continue the naval blockade, hoping that it will get Iran to cave in the next few weeks when its oil facilities could be under risk of collapsing due to the inability to export oil.

"When you have vast amounts of oil pouring through your system ... if for any reason this line is closed because you can't put it into containers or ships ... what happens is that line explodes from within ... they say they only have about three days before that happens," Trump said.

"And when it explodes you can never rebuild it the way it was...it would only be 50% of what it is right now. So I think they are under pressure."

We previously discussed the risk to Iran's infrastructure as a result of shut ins in "Tehran Timeline: Iran Has 15 Days Until Its Oil Industry Begins Full Shut-Ins."

 

* * * 

Earlier:

Stocks futures fell and oil and the dollar jumped in early trading, as risk sentiment was dented after Trump scrapped his envoys' trip to Pakistan for Iran talks, breaking down momentum toward a second round of peace talks between the US and Iran, even as the Strait of Hormuz remains indefinitely blocked. 

Futures contracts for the S&P 500 Index dropped 0.3% after the underlying index closed at a record on Friday, although with two-thirds of S&P constituents closing red: this was the second worst negative breadth all-time high for the S&P following the bizarre October record high when the S&P printed an ATH with 80% of stocks lower.

The last 2 all-time highs have been on negative breadth: Friday's record saw 324 SPX companies close lower; this was the 2nd worst negative breadth record only after Oct 28, 2025 when the S&P closed at a record with 80% of S&P companies red. pic.twitter.com/J5TBJZvvLS

— zerohedge (@zerohedge) April 25, 2026

The dollar rose against most major peers, with risk sensitive currencies such as the South African rand among the biggest laggards. Brent crude oil rose more than 2% above $107, the highest in 20 days. US Treasury futures edged lower in early trading.

The soft start to a very busy week - the bulk of the S&P is set to report in the next few days including most Mag 7s (MSFT, AMZN, META, GOOGL, AAPL) - comes after efforts to resume US-Iran peace talks collapsed over the weekend when Trump abruptly canceled a planned trip by his top envoys and Tehran said it won’t negotiate under threat. The setback adds to concerns for global equities at or near record highs (hedge funds just sold the most tech stocks in two years) with Brent crude oil rising to a 20 day high elevated bond yields from Sydney to London driving up borrowing costs.

Investors are still encouraged by strong corporate earnings and the AI boom “while keeping the US-Iran situation on their side mirrors,” said Indosuez Wealth strategist Francis Tan. But “the market is driving at 120km/h now and may have less reaction time when it is really time to change lanes.”

There have been some signs that investor enthusiasm for the biggest beneficiaries of the month-long rally may be waning. According to Goldman and BofA’s trading desks, investors should hedge across rate sensitive areas of the market such as small caps, regional banks and gold, adding that underperformance might still shake out those holding gold as high beta risk asset.

Separately, markets will remain on edge as major central banks including the Fed and Bank of Japan deliver policy decisions beginning Tuesday (no surprises expected). While investors expect them to all leave rates unchanged, traders will be alert to signs officials are worried about the inflation threat posed by the biggest disruption to oil supply in history from the Iran war.

A fresh round of speculation that policy tightening may come in coming months would be negative for government debt, which has already underperformed other assets in recent weeks as stocks and credit markets rallied with traders looking past the war. The Bloomberg GlobalAgg Index, a measure of global investment grade debt, has slid 1.7% since the Iran war broke out against the 1.5% gain in global stocks.

While the aggressive policy tightening cycle that was penciled in during the first part of the Middle East war has been partially unwound, “markets have been forced to recognize that the inflation threat is not over,” Marc Chandler, chief market strategist at Bannockburn Capital Markets wrote. April inflation reports are unlikely to offer relief from firm March readings and the spill over in to core prices is becoming more visible.

But the big variable for markets this week will not be geopolitics but earnings, with tens of trillions in market cap, some 42% of the S&P, set to report: Alphabet, Microsoft, Amazon.com and Meta are set to report Wednesday, followed by Apple a day later. The companies are worth nearly $16 trillion combined, representing a quarter of the S&P 500 Index’s market capitalization.

“It’s going to be a critical week,” said Keith Lerner, chief investment officer and chief market strategist at Truist Advisory Services. Results need “to validate this recent move,” he added.

Tyler Durden Sun, 04/26/2026 - 22:50

California's Billionaire Tax Proposal Has 'Slippery Slope' Lever

California’s latest effort to tax its richest residents into leaving is barreling toward the ballot - only this time, it's got a built-in 'slippery slope' lever once voters hand them the keys.

Backers of the proposed “billionaire tax” say they have already cleared the first hurdle, gathering more than enough signatures (at least 1.5 million) to qualify a measure that would impose a one-time 5% levy on residents with net worths above $1 billion, the Wall Street Journal reports. On its face, the proposal is straightforward: a targeted strike at roughly 200 ultrawealthy individuals meant to plug a looming multibillion-dollar hole in California’s healthcare funding. But buried in the fine print-and now surfacing in a growing political backlash-is a provision that could allow lawmakers to revisit, revise, and potentially expand the tax later with a two-thirds vote. That clause is fast becoming the real story.

The initiative’s language allows the California Legislature to amend the law so long as changes are “consistent with” and “further the purposes” of the act (aka the slippery slope). In Sacramento, that phrasing is doing a lot of work. Critics argue it effectively hands lawmakers a tool that could evolve well beyond a one-time billionaire levy. With a two-thirds majority, the Legislature could lower thresholds, extend timelines, or reinterpret what qualifies as taxable wealth. In a state where Democrats already hold supermajorities in both chambers, that is less a hypothetical than a political reality.

This is significant

I get it — taxing Billionaires is popular

But the proposed tax in CA is something vastly more expansive

It would give the CA legislature a new power:

The ability to lower the threshold or repeatedly pass the tax

Simply with votes from the CA legislature https://t.co/YcBUy7gTJN

— Shaun Maguire (@shaunmmaguire) April 27, 2026

California, meanwhile, has done this kind of thing before where they kick the door open with a seemingly innocuous bill. For example, in 2012 voters approved Proposition 30 as “temporary taxes to fund education,” promising a sunset once the recession eased. Four years later, with the economy recovered, the same coalition returned with Proposition 55 and extended the high-income tax hikes for another 12 years—without extending the sales tax or returning to voters for full approval. Nearly identical “consistent with and furthers the purposes” amendment clauses appear in Proposition 64 (marijuana legalization) and Proposition 63 (Mental Health Services Act), and have been used repeatedly to expand taxes, regulations, and spending far beyond the original ballot language. The billionaire tax measure contains this exact same permissive language. Once voters bless a flexible wealth-tax framework, Sacramento has shown it will use that door when fiscal pressure returns - which, in California, it always does.

The proposal has already triggered a high-profile reaction among the very group it targets. One of the most prominent examples is Google co-founder Sergey Brin.

Sergey BrinPhotographer: Will Oliver/EPA/Bloomberg

In a late-evening confrontation at a Christmas party hosted by crypto titan Chris Larsen in a treehouse nestled in redwoods north of San Francisco, Brin and his wellness-influencer girlfriend Gerelyn Gilbert-Soto told Gov. Gavin Newsom they were leaving the state over the proposed billionaire tax, which could hit Brin’s massive stake in Alphabet and his fortune.

Newsom, who opposes the wealth tax, was still telling people about the lengthy exchange at the party months later, complaining of a lingering cold the pair had given him, according to the people, who asked not to be named discussing private conversations with the governor. -Bloomberg

Brin followed through: he relocated to Nevada ahead of the tax’s residency cutoff, purchasing a $42 million lakeside mansion on the Nevada side of Lake Tahoe. He has since poured more than $58 million into political efforts over the past four months, becoming the largest donor to the group Building a Better California, which is dedicated to fighting the wealth tax and pushing pro-business policies. His move and massive spending have become a symbol - if not entirely representative - of a broader anxiety rippling through California’s economic base. The concern isn’t just that billionaires might leave. It’s what happens if they do.

Also his wellness-influencer girlfriend (Gilbert-Soto) is pretty hot. 

California’s tax structure is unusually dependent on its wealthiest residents. Even a small number of departures can create outsized revenue swings. Analysts have warned the proposed tax could generate “tens of billions” in the short term-but also risk long-term losses if it accelerates outmigration. Gov. Gavin Newsom has echoed that warning, opposing the measure on the grounds that it could destabilize the state’s already volatile revenue system.

That leaves California facing a paradox increasingly common in blue-state fiscal policy: a push to extract more from the ultrawealthy, paired with a growing dependence on keeping them in place. Supporters argue the stakes justify the risk. The tax is designed to offset federal healthcare cuts projected to cost the state more than $28 billion annually and leave millions without coverage.

“This did not start as a political statement about rising inequality,” said union leaders backing the measure. “We are simply trying to solve a huge and immediate problem.”

But opponents say the mechanism matters as much as the goal. Their central warning is that once the state normalizes wealth-based taxation through a flexible statutory framework, the definition of “wealthy” can shift. Today that threshold is $1 billion. Tomorrow, critics argue, it could be far lower-especially in a legislature empowered to act without returning to voters.

What a mess... 

Tyler Durden Sun, 04/26/2026 - 22:35