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Futures Tumble As Historic Rally Fizzles; Treasurys, Dollar Jump

Futures Tumble As Historic Rally Fizzles; Treasurys, Dollar Jump



Futures Tumble As Historic Rally Fizzles; Treasurys, Dollar Jump Tyler Durden Tue, 06/09/2020 - 07:59

After hanging around at 3-month highs well into the overnight session, U.S. equity futures took a sharp leg lower around the time Europe opened, sliding back under 3,200 along with European stocks on worries that the historic rally in risk assets has overshot the economic recovery giving back some of the gains from the recent historic rally after the Nasdaq notched a record closing high in the previous session, with focus now on the Federal Reserve’s two-day policy meeting. Treasuries advanced with gold and the yen.

The drop comes one day after the Nasdaq hit a fresh record closing high on Monday, while the S&P 500, which is about 5% below its own all-time high, also erased its year-to-date losses.

Declines in the U.S. premarket were broad, hitting many of the "value" stocks that had soared in recent days, ranging from cruise lines to oil drillers: American Airlines, United Airlines Holdings, Alaska Air and Marriott International all dropped between 4.5% and 9.0% in early trading after surging on Monday following another retail rush. Soon to be bankrupt Chesapeake tumbled by more than 50% following a Bloomberg reported it was preparing to file for Chapter 11; even bankrupt Hertz dropped and now sports a market cap of only $700 million or so. Macy’s rose 5.8% after raising $4.5 billion in financing, as it tries to navigate through the fallout from the COVID-19 pandemic.

In Europe, the Eurostoxx 50 dropped as much as 1.8%, with FTSE MIB and IBEX underperforming peers. The Stoxx 600 Banks Index slumped as much as 5.1% on Tuesday, the biggest drop in two months. Losses were broad, as cyclical sectors all dropped with banks, autos, oil and construction among the weakest sectors, while health care and food outperform. The decline comes after strong gains over the past two weeks that pushed the banking index up 24%.

Asian stocks gained, pushed higher by Monday's US momentum, led by finance and consumer staples. Markets in the region were mixed, with Australia's S&P/ASX 200 and Hong Kong's Hang Seng Index rising, and Thailand's SET and Jakarta Composite falling. The Topix declined 0.1%, with Asahi Broadcasting Group and Mynet falling the most. The Shanghai Composite Index rose 0.6%, with Chengdu B-Ray Media and Hangzhou Jiebai Group posting the biggest advances

As Bloomberg notes, "after a record-breaking rally that added $21 trillion to global stock markets, valuations look now stretched and technical indicators suggest a pullback is overdue. The World Bank warned the economy will contract the most since World War II this year, reducing incomes and sending millions of people into poverty in emerging and developing nations."

"There are a lot of unknowns that we are dealing with despite the fact that normalizations of economic activities are still on track," said Value Partners manager Frank Tsui. “There are still a lot of unknown factors.”

While no major policy announcements are expected when the U.S. central bank wraps up its meeting on Wednesday, policymakers will issue economic projections for the first time since December, before a decade-long economic expansion was brought to a grinding halt due to coronavirus-induced lockdowns. Last week’s strikingly strong employment data for May strengthened views that the worst of the economic fallout from the pandemic was over, and is also expected to be discussed at the meeting. On Monday, the Fed expanded its Main Street Lending Program, allowing more companies to participate and lessening the burden on banks that create the loans, confirming that America's small businesses are getting crushed.

In rates, Treasuries jumped with yields falling 1-6 basis points across the curve, the 10Y sliding just above 0.80%, bull-flattening for second consecutive session. Cash volumes have been light, however, especially in long maturities. According to Bloomberg, the bull-flattening eroded profit in curve steepeners, a popular trade ahead of Wednesday’s FOMC meeting. Yields richer by 1bp to 7bp across the curve led by 20- and 30- year sectors, flattening 5s30s by 3.2bp and 2s10s by 3.5bp; 10- year yields lower by 4.4bp at ~0.83% with bunds, gilts both cheaper by around 4bp. Treasury auction cycle resumes with $29b 10-year reopening at 1pm ET, concludes with $19b 30-year reopening Thursday, with FOMC meeting intervening on Wednesday. A gauge of European junk-grade credit risk increased the most since April.

In FX, the dollar rose against a basket of currencies for the first time in nine days. The Bloomberg Dollar Spot Index ended its longest losing streak since 2011 as the greenback rose against most Group-of-10 peers ; the euro edged lower, to trade below 1.13 per euro dollar and bunds edged higher. The pound fell against the dollar after an eight-day winning streak for the currency looked to have taken it far enough, and wider risk appetite faded on global markets. Norway’s krone plunged as oil prices slumped. Japan’s currency rose against all its Group-of-10 peers and staged its biggest 2-day rally against the greenback in more than two months after a decline in stocks in Tokyo prompted traders to cover short yen positions. The Australian dollar swung to a deep loss against the greenback after climbing to the highest level this year, dragged lower by the yen’s surge.

In commodities, the energy complex continued to leak in the aftermath of the OPEC+ meeting as players question the enforcement (or not) of the agreed upon output cuts with laggards such as Iraq already hinting as difficulties on overcompliance. Further, some traders also cite a “buy the rumour, sell the fact” playbook given the rally in the complex heading into the meeting. Meanwhile, BP’s demand-driven job cuts yesterday added further weighed on prices. Elsewhere, in Libya, source reports noted that El-Sharara’s production has again been shuttered by armed men ordering employees to stop working – which comes just two days after the restart and lift of force majeure on exports (now reimposed), albeit the oilfield was only producing at a tenth of its 300k BPD full capacity – which was expected to be reached within 90 days

Expected data include wholesale inventories. Tiffany and Chewy are reporting earnings

Market Snapshot

  • S&P 500 futures down 1% to 3,196.25
  • STOXX Europe 600 down 1.2% to 369.75
  • MXAP up 0.4% to 161.06
  • MXAPJ up 0.5% to 517.26
  • Nikkei down 0.4% to 23,091.03
  • Topix down 0.1% to 1,628.43
  • Hang Seng Index up 1.1% to 25,057.22
  • Shanghai Composite up 0.6% to 2,956.11
  • Sensex down 0.4% to 34,228.05
  • Australia S&P/ASX 200 up 2.4% to 6,144.95
  • Kospi up 0.2% to 2,188.92
  • German 10Y yield fell 1.9 bps to -0.338%
  • Euro down 0.4% to $1.1247
  • Italian 10Y yield fell 0.7 bps to 1.234%
  • Spanish 10Y yield rose 0.8 bps to 0.556%
  • Brent futures down 1.8% to $40.07/bbl
  • Gold spot up 0.5% to $1,706.57
  • U.S. Dollar Index up 0.5% to 97.06

Top Overnight News from Bloomberg

  • Demand for government bonds is showing no signs of letup, with Ireland securing record investor demand despite a host of countries, including the U.K., selling debt
  • Prime Minister Boris Johnson will talk his cabinet through his plans for easing the U.K.’s lockdown on Tuesday after officials reported the lowest number of daily deaths since restrictions were imposed
  • German exports plunged at a record pace in April when economies around the world shut down to contain the coronavirus
  • French economic output will take two years to recover from the virus-related slump that that will inflict even longer lasting damage on the labor market, the country’s central bank said
  • Deflation is back on the minds of European Central Bank officials, presaging battles for President Christine Lagarde over whether the euro zone needs yet more monetary stimulus.
  • Japan’s famously low- yielding bonds hold surprising appeal for Australian investors, thanks to how cheap the yen is in funding markets. Investors holding Australian dollars can generate healthy returns on 10- year and 30-year JGBs using cross-currency basis swaps

The risk tone across the Asia-Pac region was mostly positive with the regional bourses spurred by the firm handover from Wall St where the DJIA led the respectable gains across the major indices and the Nasdaq printed a fresh record high as there wasn’t much to derail the ongoing reopening and recovery narrative. Furthermore, the S&P 500 turned positive YTD and all sectors closed in the green with substantial gains seen in energy names following the OPEC+ output cut extension, despite an actual pullback in oil prices that was attributed to participants selling the news and concerns regarding compliance issues. ASX 200 (+2.4%) and Nikkei 225 (-0.4%) traded mixed with Australia the outperformer as it played catch up on return from the holiday closure and with gains spearheaded by financials and energy, while the Japanese benchmark lagged as exporters suffered from the ill effects of a stronger currency. The KOSPI (+0.2%) was subdued after North Korea announced to sever communication with South Korea completely from today and with index heavyweight Samsung Electronics failing to hold on to most the opening gains despite the court ruling to reject the arrest of de facto head Jay Y. Lee. Elsewhere, Hang Seng (+1.1%) climbed back above the 25k milestone with the government planning to bailout Cathay Pacific through a HKD 30bln loan and the Shanghai Comp. (+0.6%) conformed to the predominantly upbeat tone after the PBoC resumed its liquidity efforts, albeit with a reserved CNY 60bln injection. Finally, 10yr JGBs extended on this week’s rebound amid a similar recovery in USTs and underperformance of Japanese stocks, but with upside capped amid the lack of BoJ presence in the market today.

Top Asian News

  • Japan Low-Yield Bonds Have Surprise Appeal for Aussie Funds
  • China Urges Students to Assess Risks of Studying in Australia
  • How Covid Upended 20 Million Lives in India’s Finance Hub

European stocks continue to deteriorate with downside exacerbated since the European cash open [Euro Stoxx 50 -2.0%] as investors side-line the recent Central bank/reopen-induced rally and fixate on the backdrop of skittish US-Sino rhetoric, potential second wave as lockdown measures ease and amid Western protests/riots. An argument could also be built for profit-taking at near pre-COVID highs ahead of immediate risk events such as the FOMC meeting and the Eurogroup summit. Sectors are mostly in the red with underperformance in energy and financials amid the deterioration in energy prices and yields, whilst broader sectors point to a more risk averse session and defensives fare better – particularly healthcare. The detailed breakdown paints a similar picture Travel & Leisure also bearing the brunt of risk aversion. In terms of individual movers, the session kicked off with the French aerospace sector significantly higher amid France unveiling a EUR 15bln package for the sector vs. Exp. EUR 10bln, albeit the likes of Airbus (-6.6%), Thales (-2.9%) and Safran (-3.5%) have since conformed to the broader risk tone. Meanwhile, British American Tobacco (-4.5%) extended on losses after trimming its FY guidance and pointing to low growth.

Top European News

  • VW Board Infighting Rocks Carmaker Struggling With Virus Crisis
  • Deflation Fears at ECB Mean Stimulus Battles Ahead for Lagarde
  • Ireland Gets Record 50 Billion Euros of Orders in Bond Sale
  • SocGen Signals Mixed Second Quarter as Tough Market Endures

In FX, not the biggest G10 move today, but Usd/Jpy has now reversed in excess of 2 big figures from post-NFP highs alongside similar pronounced retracements in Eur/Jpy and other Yen crosses as risk appetite evaporates amidst further re-flattening in debt markets. The headline pair is back down below 108.00 and a key technical level (200 DMA at 108.44), with the 50 DMA (107.65) exposed ahead of last Tuesday’s 107.51 low as safe-haven demand picks up generally to the benefit of Gold (over Usd 1700/oz again) and the Swiss Franc (Usd/Chf testing 0.9550 and Eur/Chf 1.0750 after breaching its 200 DMA - 1.0769). Back to the Yen, no adverse reaction to S&P cutting Japan’s A+ ratings outlook to stable from positive.

  • AUD/NZD/CAD - The aforementioned deterioration in risk sentiment on rising Chinese-US/Australian tensions, NK terminating official lines of communication with SK and crude prices unwinding more OPEC+ extension gains, has hit the high beta Aussie and Kiwi particularly hard, even though independent impulses via improvements in NAB and ANZ business surveys overnight may otherwise be supportive. Indeed, Aud/Usd has pulled back around 150 pips to sub-0.6900 and Nzd/Usd is losing grip of 0.6500 after extending gains on the handle to around 0.6580, albeit Aud/Nzd still trending lower towards 1.0750 in the run up to NZ Q1 manufacturing sales. Meanwhile, the Loonie has handed back a chunk of its recent oil-powered upside vs the Greenback with Usd/Cad rebounding from circa 1.3359 to 1.3487 ahead of the FOMC on Wednesday, and this along with an element of broader risk-off positioning is keeping the DXY afloat near 97.000.
  • NOK/GBP/SEK/EUR - All weaker, albeit to varying degrees, as the Norwegian Krona underperforms in wake of another bleak Norges Bank regional survey and the correction in crude, while Sterling and the Swedish Crown are undermined by cross selling against the Yen and the overall bearish tone, but the Euro holds up bit better vs the Dollar in consolidative trade. Eur/Nok has bounced firmly following a more concerted test of the 200 DMA, Cable is back under 1.2650 after failing to sustain 1.2750+ status, Eur/Sek is back above 10.4000 and Eur/Usd is trying to keep afloat within a 1.1314-1.1242 range.
  • EM - In contrast to widespread reversals vs the Usd, the Try is just staying north of 6.8000 by virtue of Turkey finally ending years of isolation from Euroclear for bond settlements and joining the international platform.

In commodities, the energy complex continues to leak in the aftermath of the OPEC+ meeting as players question the enforcement (or not) of the agreed upon output cuts with laggards such as Iraq already hinting as difficulties on overcompliance. Further, some traders also cite a “buy the rumour, sell the fact” playbook given the rally in the complex heading into the meeting. Meanwhile, BP’s demand-driven job cuts yesterday added further weighed on prices. Elsewhere, in Libya, source reports noted that El-Sharara’s production has again been shuttered by armed men ordering employees to stop working – which comes just two days after the restart and lift of force majeure on exports (now reimposed), albeit the oilfield was only producing at a tenth of its 300k BPD full capacity – which was expected to be reached within 90 days. All-in-all, the OPEC fallout and deteriorating risk sentiment sees WTI July back below USD 38/bbl and closer to USD 37/bbl (vs. high USD 38.86/bbl) , whilst Brent suffers and has breached USD 40/bbl to the downside (vs. high 41.45/bbl). Participants today will be eyeing the monthly EIO STEO – with focus on their estimates for US oil production – the prior report estimated an average output of 11.7mln BPD in 2020 and 10.9mln BPD in 2021. Meanwhile, the weekly Private Inventory data could also offer some short-term volatility in prices. Turning to metals, spot gold continues to gain ground above USD 1700/oz amid risk aversion despite the firmer Buck as investors flee to the safe haven metal, with geopolitical tensions between North Korea/South Korea coupled with Aussie-Sino strains also underpinning the yellow metal. Copper prices are pulling back in tandem with the stock markets and broader sentiment, but prices remain comfortably north of USD 2.5/lb at present.

US Event Calendar

  • 6am: NFIB Small Business Optimism, est. 92.5, prior 90.9
  • 10am: JOLTS Job Openings, est. 5,750, prior 6,191
  • 10am: Wholesale Inventories MoM, est. 0.4%, prior 0.4%; Wholesale Trade Sales MoM, est. -2.0%, prior -5.2%

DB's Jim Reid concludes the overnight wrap

Yesterday we officially waved goodbye to the longest US cycle in history as the National Bureau of Economic Research declared that the US has been in a recession since February, thus ending a 128 month expansion. Whilst we’ll never know what would have happened if Covid-19 had not occurred, it’s fascinating that the best predictor of recessions, namely the US yield curve, has struck again. More by luck than judgement this time but the cycle did look increasingly stretched beforehand so this cycle may not have had much life left in it anyway. However it sums the current financial world up perfectly at the moment when on the day we get the official recession word, the NASDAQ hit a new record high and the S&P 500 erased all its declines for 2020. Looking at these indices you’d be forgiven for wondering what all the fuss has been about in 2020.

Looking at the moves in more depth, the S&P 500 closed up +1.20% (+0.05% YTD now), while the NASDAQ climbed +1.13% on the day. The Dow Jones was a big out-performer with a +1.70% advance, driven by Boeing’s +12.20% move. The rotation of recent days was in full effect as cyclicals like Energy (+4.32%) and Banks (+2.78%) were among the best performing industries, while semiconductors (-0.26%) were the only industry group lower yesterday.

About a half hour before US markets closed, the Fed announced that their “Main Street” program, which will open soon to eligible lenders, would be available to more businesses. This seemed to drive the last half percentage point of the rally last night. In terms of details, the central bank lowered loan minimums to $250,000 from $500,000 while extending the loan term to five years from four. Also businesses in the program will be able to defer principal payments on their loans for two years, up from the previously announced one. And finally, in a step meant to incentivize greater participation from banks, lenders will only be required to hold 5% of the loans on their balance sheet, while previously it had been 15%. As a reminder, the Main Street facilities are backed by a $75 billion investment from the Treasury, which is part of the $454bn allocated by Congress in the CARES Act for the Fed’s emergency-lending programs.

Over in Europe there was a bit more of a subdued picture after an impressive run. The STOXX 600 was down -0.32%, with the DAX (-0.22%), CAC 40 (-0.43%) and the FTSE 100 (-0.18%) all losing ground yesterday. European banks were the best performing sector in the index though, up +1.97%, as cyclicals continued to outperform on both sides of the Atlantic.

Markets are a bit more mixed in Asia overnight with the Nikkei (-0.68%) and Kospi (-0.30%) down while the Hang Seng (+1.30%) and Shanghai Comp (+0.47%) are up. Not helping sentiment is news that North Korea will shut down a liaison office it shares with South Korea and sever other official communication including a leaders’ hotline. The country cited that South Korean authorities have “connived” to carry out “hostile acts” against the country. The KCNA also reported that “this measure is the first step of the determination to completely shut down all contact means with South Korea and get rid of unnecessary things.”

That seems to have helped fuel a bid for the Yen (+0.32%) while all other G-10 currencies are trading weak against the greenback. Meanwhile, yields on 10y USTs are down -3.3bps to 0.843% and futures on the S&P 500 are down -0.17%. Elsewhere, WTI crude oil prices are up 1% this morning to $38.58. In terms of overnight data releases the UK’s May BRC like for like sales surprised to the upside with print at +7.9% yoy (vs. +3.0% yoy expected and +5.7% yoy last month).

Back in Europe, we also got some headlines from ECB President Lagarde’s appearance before the European Parliament’s economic and monetary affairs committee. Perhaps the main news was on the German constitutional court though, which as you’ll know has asked the ECB to carry out a proportionality assessment of their public sector purchase programme. In her introductory statement, it was notable that Lagarde explicitly echoed this language, saying that the ECB’s “crisis-related measures are temporary, targeted and proportionate”, and also that “the ECB continually monitors the proportionality of its instruments.” Lagarde also called the net effects of last week’s expansion of the PEPP by a further €600bn “overwhelmingly positive.”

Against this backdrop, market inflation expectations for the Euro Area hit a 3-month high yesterday, with five-year forward five-year inflation swaps rising to 1.09%. Similarly, inflation expectations in the US rose +3.9 bps yesterday to 1.89%. Our US economics team published a report yesterday, where they see the Covid-19 shock generating severe disinflationary pressure in the near-term, but then recovering to near the Fed’s 2% target. See their paper here for more

Meanwhile, sovereign debt advanced both in Europe and the US yesterday after the recent sell-off, with yields on 10yr bunds falling by -4.2bps to -0.32% and US treasury yields down -2.0bps to 0.875%. There was a slight widening in peripheral bond spreads, with the spreads of 10yr yields on both Italian (+3.4bps) and Spanish (+3.2bps) debt over bunds widening marginally following the big tightening seen last week.

One of the big moves yesterday came from oil, where Brent crude snapped a run of 7 successive advances to fall -3.55% following an announcement from Saudi Arabia that they wouldn’t maintain their deeper cuts on output after this month, as well as a move from Libya to resume exports from their largest oil field. Brent now stands at $40.80/bbl, while WTI also declined -3.44% to $38.19/bbl.

There wasn’t a great deal of data out yesterday, though German industrial production fell by -17.9% in April (vs. -16.5% expected), following a revised -8.9% decline in March. The move puts the year-on-year decline for April at -25.3%, which to put that in perspective is above the peak -21.8% annual decline following the GFC in April 2009. Meanwhile in Canada, May’s housing starts rose to 193.5k on an annualised basis (vs. 160.0k expected).

To the day ahead, and data highlights in Europe include the German and French trade balance for April, as well as the final estimate of the Euro Area’s GDP in Q1. Over in the US, there’s also the NFIB small business optimism index for May, and April job openings. Separately, we’ll hear from the ECB’s Rehn, and the BoE’s Cunliffe.

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Who Can You Trust?

Who Can You Trust?

Authored by James Howard Kunstler via,

“I’m sick and tired of hearing Democrats whining about Joe Biden’s…



Who Can You Trust?

Authored by James Howard Kunstler via,

“I’m sick and tired of hearing Democrats whining about Joe Biden’s age. The man knows how to govern. Just shut up and vote to save Democracy.”

- Rob Reiner, Hollywood savant

Perhaps you’re aware that the World Health Organization (WHO) is cooking up a plan to impose its will over all the sovereign nations on this planet in the event of future pandemics.

That means, for instance, that the WHO would issue orders to the USA about lockdowns, vaccines, and vaccine passports and we US citizens supposedly would be compelled to follow them.

Why the “Joe Biden” regime would go along with this globalist fuckery is one of the abiding mysteries of our time - except that they go along with everything else that the cabal of Geneva cooks up, such as attacks on farmers, and on oil production, and on relations between men and women, and on personal privacy, and on economic liberty throughout Western Civ, as if they’re working overtime to kill it off. And all of us with it.

I think they are working overtime at that because the sore-beset citizens of Western Civ are onto their game, and getting restless about it. So, the Geneva cabal is in a race against time before the center pole of their circus tent collapses and the nations of the world are compelled to follow the zeitgeist in the direction of de-centralizing, foiling all their grand plans.

The “Joe Biden” regime is pretending to ignore the reality that this WHO deal is actually a treaty that would require ratification by a two-thirds vote in the senate, an unlikely outcome. In any case, handing over authority to the WHO — in effect, to its chief Tedros Adhanom Ghebreyesus — to push around American citizens like a giant herd of cattle would be patently unlawful.

That center pole of the circus tent is the wobbling global economy. It’s barely holding up the canvas over the three rings of the circus. In the center ring, the death-defying spectacle of the Biden Family crime case is playing out before a huge audience (us). This week, a gun went off at the FBI and smoke is curling out of the barrel. FBI Director Christopher Wray was forced to verify that he’s been sitting on an incriminating document for three years from a “trusted” confidential human source, i.e., an informant, stating that the Biden Family received a $5-million bribe from a foreign entity when “JB” was vice-president.

That’s only one bribe of many others, of course, as documented in the Hunter Biden laptop, and it must be obvious it represents treasonous behavior that will demand resignation or impeachment. As this spools out in the weeks and months ahead, do you think Americans will be in the mood to accept further insults such as “Joe Biden” surrendering our national sovereignty to the WHO?

Anyway, you must ask yourself: why on earth should I trust the WHO about anything? Did they not participate in laying a trip on the world with Covid-19? How did those lockdowns work out? Do you think they destroyed enough businesses and ruined enough households? How’s the vaccination program doing? Effective? Safe? Yeah, maybe not so much. Maybe killing a lot of people, wrecking immune systems, sterilizing reproductive organs, causing gross disabilities, shattering lives.

Of course, in over three years neither the WHO nor the US medical authorities showed the slightest interest in helping to figure out how the Covid-19 virus was made in a lab, and exactly how it got loose in the world. Lately, Dr. Ghebreyesus has warned the world about much worse future pandemics supposedly coming down at us. Oh? Really? What does he know that we don’t? That possibly new efforts to concoct chimeric diseases are ongoing in labs around the world? (You know that dozens of such labs were discovered in Ukraine as the war got underway there in 2022.) What’s Dr. Ghebreyesus doing to stop that?

If US orgs and citizens are involved in this “research,” why doesn’t the WHO alert our government leaders so they can stop it? (Would they? I’m not so sure.) And, who is behind it this time? The Eco-Health Alliance again, like with Covid-19? By the way, that outfit got another whopping grant last fall from the NIH to “study” bat viruses — right after the NIH terminated a previous grant on account of The Eco-Health Alliance failing to turn over notebooks and other records.

No, you cannot trust the WHO about anything. The “trust horizon” (a concept introduced by the great Nicole Foss, late of The Automatic Earth dot com) is shrinking. You can no longer trust any distant authorities. You also cannot trust the US federal government (especially the executive branch behind “Joe Biden”). And notice: the trust horizon is shrinking just as the world is de-centralizing. This, you see, is the main contradiction behind all the Globalists’ twisted ambitions to control everything, including you. They are working against the current tide of human history which is pushing everything toward down-scaling, re-localization, and re-assertion of the sovereign individual person.

That trend will become increasingly evident as things organized at the giant scale start to implode — giant retail chains, medical behemoths, hedge funds, big banks, you name it. The world no longer has the mojo for globalism. There’s reason to wonder these days whether the USA has the mojo to remain a unified national polity of states. Our federal government is not only financially bankrupt beyond any coherent reckoning, it is also morally bankrupt, and it has decided to make war against its own people. None of this is satisfactory and none of this is working. It’s time to figure out who and what you can trust and act accordingly.

Tyler Durden Sun, 06/04/2023 - 09:20

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Removing antimicrobial resistance from the WHO’s ‘pandemic treaty’ will leave humanity extremely vulnerable to future pandemics

Drug-resistant microbes are a serious threat for future pandemics, but the new draft of the WHO’s international pandemic agreement may not include provisions…




Antimicrobial resistance is now a leading cause of death worldwide due to drug-resistant infections, including drug-resistant strains of tuberculosis, pneumonia and Staph infections like the methicillin-resistant Staphylococcus aureus shown here. (NIAID, cropped from original), CC BY

In late May, the latest version of the draft Pandemic Instrument, also referred to as the “pandemic treaty,” was shared with Member States at the World Health Assembly. The text was made available online via Health Policy Watch and it quickly became apparent that all mentions of addressing antimicrobial resistance in the Pandemic Instrument were at risk of removal.

Work on the Pandemic Instrument began in December 2021 after the World Health Assembly agreed to a global process to draft and negotiate an international instrument — under the Constitution of the World Health Organization (WHO) — to protect nations and communities from future pandemic emergencies.

Read more: Drug-resistant superbugs: A global threat intensified by the fight against coronavirus

Since the beginning of negotiations on the Pandemic Instrument, there have been calls from civil society and leading experts, including the Global Leaders Group on Antimicrobial Resistance, to include the so-called “silent” pandemic of antimicrobial resistance in the instrument.

Just three years after the onset of a global pandemic, it is understandable why Member States negotiating the Pandemic Instrument have focused on preventing pandemics that resemble COVID-19. But not all pandemics in the past have been caused by viruses and not all pandemics in the future will be caused by viruses. Devastating past pandemics of bacterial diseases have included plague and cholera. The next pandemic could be caused by bacteria or other microbes.

Antimicrobial resistance

Yellow particles on purple spikes
Microscopic view of Yersinia pestis, the bacteria that cause bubonic plague, on a flea. Plague is an example of previous devastating pandemics of bacterial disease. (NIAID), CC BY

Antimicrobial resistance (AMR) is the process by which infections caused by microbes become resistant to the medicines developed to treat them. Microbes include bacteria, fungi, viruses and parasites. Bacterial infections alone cause one in eight deaths globally.

AMR is fueling the rise of drug-resistant infections, including drug-resistant tuberculosis, drug-resistant pneumonia and drug-resistant Staph infections such as methicillin-resistant Staphylococcus aureus (MRSA). These infections are killing and debilitating millions of people annually, and AMR is now a leading cause of death worldwide.

Without knowing what the next pandemic will be, the “pandemic treaty” must plan, prepare and develop effective tools to respond to a wider range of pandemic threats, not solely viruses.

Even if the world faces another viral pandemic, secondary bacterial infections will be a serious issue. During the COVID-19 pandemic for instance, large percentages of those hospitalized with COVID-19 required treatment for secondary bacterial infections.

New research from Northwestern University suggests that many of the deaths among hospitalized COVID-19 patients were associated with pneumonia — a secondary bacterial infection that must be treated with antibiotics.

An illustrative diagram that shows the difference between a drug resistant bacteria and a non-resistant bacteria.
Antimicrobial resistance means infections that were once treatable are much more difficult to treat. (NIAID), CC BY

Treating these bacterial infections requires effective antibiotics, and with AMR increasing, effective antibiotics are becoming a scarce resource. Essentially, safeguarding the remaining effective antibiotics we have is critical to responding to any pandemic.

That’s why the potential removal of measures that would help mitigate AMR and better safeguard antimicrobial effectiveness is so concerning. Sections of the text which may be removed include measures to prevent infections (caused by bacteria, viruses and other microbes), such as:

  • better access to safe water, sanitation and hygiene;
  • higher standards of infection prevention and control;
  • integrated surveillance of infectious disease threats from human, animals and the environment; and
  • strengthening antimicrobial stewardship efforts to optimize how antimicrobial drugs are used and prevent the development of AMR.

The exclusion of these measures would hinder efforts to protect people from future pandemics, and appears to be part of a broader shift to water-down the language in the Pandemic Instrument, making it easier for countries to opt-out of taking recommended actions to prevent future pandemics.

Making the ‘pandemic treaty’ more robust

Measures to address AMR could be easily included and addressed in the “pandemic treaty.”

In September 2022, I was part of a group of civil society and research organizations that specialize in mitigating AMR who were invited the WHO’s Intergovernmental Negotiating Body (INB) to provide an analysis on how AMR should be addressed, within the then-draft text.

They outlined that including bacterial pathogens in the definition of “pandemics” was critical. They also identified specific provisions that should be tweaked to track and address both viral and bacterial threats. These included AMR and recommended harmonizing national AMR stewardship rules.

In March 2023, I joined other leading academic researchers and experts from various fields in publishing a special edition of the Journal of Medicine, Law and Ethics, outlining why the Pandemic Instrument must address AMR.

The researchers of this special issue argued that the Pandemic Instrument was overly focused on viral threats and ignored AMR and bacterial threats, including the need to manage antibiotics as a common-pool resource and revitalize research and development of novel antimicrobial drugs.

Next steps

While earlier drafts of the Pandemic Instrument drew on guidance from AMR policy researchers and civil society organizations, after the first round of closed-door negotiations by Member States, all of these insertions, are now at risk for removal.

The Pandemic Instrument is the best option to mitigate AMR and safeguard lifesaving antimicrobials to treat secondary infections in pandemics. AMR exceeds the capacity of any single country or sector to solve. Global political action is needed to ensure the international community works together to collectively mitigate AMR and support the conservation, development and equitable distribution of safe and effective antimicrobials.

By missing this opportunity to address AMR and safeguard antimicrobials in the Pandemic Instrument, we severely undermine the broader goals of the instrument: to protect nations and communities from future pandemic emergencies.

It is important going forward that Member States recognize the core infrastructural role that antimicrobials play in pandemic response and strengthen, rather than weaken, measures meant to safeguard antimicrobials.

Antimicrobials are an essential resource for responding to pandemic emergencies that must be protected. If governments are serious about pandemic preparedness, they must support bold measures to conserve the effectiveness of antimicrobials within the Pandemic Instrument.

Susan Rogers Van Katwyk is a member of the WHO Collaborating Centre on Global Governance of Antimicrobial Resistance at York University. She receives funding from the Wellcome Trust and the Social Sciences and Humanities Research Council of Canada.

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Spread & Containment

Repeated COVID-19 Vaccination Weakens Immune System: Study

Repeated COVID-19 Vaccination Weakens Immune System: Study

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

Repeated COVID-19…



Repeated COVID-19 Vaccination Weakens Immune System: Study

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

Repeated COVID-19 vaccination weakens the immune system, potentially making people susceptible to life-threatening conditions such as cancer, according to a new study.

A man is given a COVID-19 vaccine in Chelsea, Mass., on Feb. 16, 2021. (Joseph Prezioso/AFP via Getty Images)

Multiple doses of the Pfizer or Moderna COVID-19 vaccines lead to higher levels of antibodies called IgG4, which can provide a protective effect. But a growing body of evidence indicates that the “abnormally high levels” of the immunoglobulin subclass actually make the immune system more susceptible to the COVID-19 spike protein in the vaccines, researchers said in the paper.

They pointed to experiments performed on mice that found multiple boosters on top of the initial COVID-19 vaccination “significantly decreased” protection against both the Delta and Omicron virus variants and testing that found a spike in IgG4 levels after repeat Pfizer vaccination, suggesting immune exhaustion.

Studies have detected higher levels of IgG4 in people who died with COVID-19 when compared to those who recovered and linked the levels with another known determinant of COVID-19-related mortality, the researchers also noted.

A review of the literature also showed that vaccines against HIV, malaria, and pertussis also induce the production of IgG4.

“In sum, COVID-19 epidemiological studies cited in our work plus the failure of HIV, Malaria, and Pertussis vaccines constitute irrefutable evidence demonstrating that an increase in IgG4 levels impairs immune responses,” Alberto Rubio Casillas, a researcher with the biology laboratory at the University of Guadalajara in Mexico and one of the authors of the new paper, told The Epoch Times via email.

The paper was published by the journal Vaccines in May.

Pfizer and Moderna officials didn’t respond to requests for comment.

Both companies utilize messenger RNA (mRNA) technology in their vaccines.

Dr. Robert Malone, who helped invent the technology, said the paper illustrates why he’s been warning about the negative effects of repeated vaccination.

“I warned that more jabs can result in what’s called high zone tolerance, of which the switch to IgG4 is one of the mechanisms. And now we have data that clearly demonstrate that’s occurring in the case of this as well as some other vaccines,” Malone, who wasn’t involved with the study, told The Epoch Times.

So it’s basically validating that this rush to administer and re-administer without having solid data to back those decisions was highly counterproductive and appears to have resulted in a cohort of people that are actually more susceptible to the disease.”

Possible Problems

The weakened immune systems brought about by repeated vaccination could lead to serious problems, including cancer, the researchers said.

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Tyler Durden Sat, 06/03/2023 - 22:30

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