Zero Hedge

Ukraine Says Talks To Join NATO Becoming 'Very Toxic'

July 8, 2025 - 2:45am

Ukraine Says Talks To Join NATO Becoming 'Very Toxic'

Ukraine's talks with NATO over a path to future membership have become increasingly tense and unproductive, according to Ukrainian Foreign Ministry spokesman Georgy Tikhy.

In a recent interview, Tikhy described the discussions as "toxic" (something he said elsewhere weeks ago too) - characterizing the negotiations as repetitive and are no longer making progress. He also indicated there does not appear to be a chance for breakthrough anywhere on the horizon.

NATO file image

The foreign ministry official conveyed his assessment in a recent interview featured on the YouTube channel of journalist Aleksandr Notevsky.

The words gained attention in Russian state media, which subsequently translated some of Tikhy's key statements. "All the arguments and counterarguments have already been presented, and each new round of negotiations on Ukraine’s accession to NATO goes in circles," he said. The discussions "have become, to put it simply, very toxic," he emphasized.

The NATO bloc has consistently held out that "Ukraine's future is in NATO." Secretary-General Mark Rutte had at this summer's annual NATO defense summit, hosted in The Hague, issued similarly optimistic words.

However, what's become clear is that waning American support for Ukraine's military, and even President Trump's stated desire to step back from leadership in NATO amid lack of fair cost-sharing among allies, has resulted in a broad decline in enthusiasm and momentum for Ukraine's accession.

This is where things stand following NATO's June summit:

It was therefore something of a relief that Nato’s summit in The Hague produced a short joint declaration on June 25 in which Russia was clearly named as a “long-term threat … to Euro-Atlantic security”. Member states restated “their enduring sovereign commitments to provide support to Ukraine”. While the summit declaration made no mention of future Nato membership for Ukraine, the fact that US president Donald Trump agreed to these two statements was widely seen as a success.

Yet, within a week of the summit, Washington paused the delivery of critical weapons to Ukraine, including Patriot air defence missiles and long-range precision-strike rockets. The move was ostensibly in response to depleting US stockpiles.

Simultaneously Russia has made steady gains along the almost 1,000km long frontline, and is even expanding operations into a central oblast, beyond the Donbass region.

Georgy Tikhy, via Interfax-Ukraine

Russian forces have also in the last days declared that it maintains full control over the whole region of the Luhansk, where Russian forces made quickest gains early on. The Kremlin has shown patience in this grinding war of attrition, though its advances have been costly in terms of manpower, as it taps reserves and continues recruitment efforts back home.

Tyler Durden Tue, 07/08/2025 - 02:45

Lights Out, Europe: The Cost Of Brussels' Energy Fantasy

July 8, 2025 - 2:00am

Lights Out, Europe: The Cost Of Brussels' Energy Fantasy

Authored by Javier Villamor via europeanconservative.com,

Spain’s leading energy companies - Iberdrola, Endesa, and EDP - remain stunned. After the nationwide blackout that cut power across Spain on April 28, the government has yet to provide a clear explanation or take technical responsibility...

The companies, represented by the employers’ association Aelec, have denounced “surprising omissions” in the official investigation. They demand that the extreme voltage spikes recorded in the days leading up to the collapse be included in the analysis. They have criticized the preliminary report from ENTSO-E—the European network of electricity operators—for claiming that “the system was operating normally” just seconds before the failure. Meanwhile, severe voltage swings were recorded, going beyond safety limits and triggering automatic shutdowns of high-voltage substations and key refineries.

This episode is far more than an isolated incident. It is a metaphor for the erratic direction taken by the European Union’s energy policy. In the name of climate change, Brussels has embarked on a radical overhaul of its energy model driven not by technical or economic realities, but by an ideological agenda imposed by political and bureaucratic elites. What was marketed as a smooth transition toward renewable energy has turned into a forced green agenda, with no viable alternatives and little regard for its impact on competitiveness, system stability, or citizens’ well-being.

At the root of this drift lies the REPowerEU plan, launched after the start of the war in Ukraine with the stated aim of “fully decoupling” Europe from Russian energy. What initially appeared to be a justified geostrategic measure quickly became, in the hands of the European Commission, a pretext to push through renewable energies at any cost. This led to a rushed and uneven transition, with citizens and businesses footing the bill.

This leap into the void has destabilized key sectors such as agriculture, transport, and industry, forcing them to absorb rising costs without receiving real technological upgrades. Countries like Germany, which shut down their nuclear plants out of political conviction, have now had to reopen coal-fired stations in a contradictory reversal. Meanwhile, state propaganda continues to promote green energy self-sufficiency, while households face record electricity bills and companies lose competitiveness.

The structural failures of the European power grid are becoming increasingly evident. The continental grid was designed for stable and predictable hydro, gas, and nuclear sources. The mass introduction of intermittent sources like wind and solar makes imbalances difficult to manage: without wind or sun, generation collapses; with too much, the grid becomes dangerously overloaded.

On April 28th, the Iberian Peninsula experienced those consequences firsthand. Abnormal voltage levels were detected in several substations throughout the morning. To grasp the gravity: a “voltage oscillation” involves a sudden and significant fluctuation in the grid’s voltage, which can damage equipment, trigger automatic disconnections, or, in extreme cases, cause a total blackout. At the Lancha substation, voltage reached nearly 250 kV on a line rated for 220. Another line, rated at 400 kV, surpassed 470 kV just before the collapse. According to Aelec, these anomalies began as early as 10:00 a.m. While a sudden drop of 2,200 MW in generation has been cited as the trigger, the system is theoretically built to withstand a loss of up to 3,000 MW without shutting down. This was not a coincidental failure—it was a built-in weakness.

Beyond technical and political issues, the forced energy transition takes a human toll. European households are paying more for electricity, hitting middle- and lower-income families especially hard. Electrification of transport, promoted without adequate foresight, is raising the cost of mobility due to a lack of reliable charging infrastructure. Farmers and truckers, already squeezed by unmanageable climate regulations, face growing expenses while being pressured to make investments they cannot afford.

Moreover, blackouts are no minor issue: their impact ranges from multimillion-euro industrial losses to the paralysis of hospitals, schools, and transport networks. In Spain, the outage even cost five people their lives. An energy model that cannot ensure a steady supply threatens the economy and public safety.

European industry, particularly in the central and southern parts of the continent, is already bearing the brunt. Unable to compete with American or Asian energy prices, many companies are relocating production or shutting down. Paradoxically, even sectors the green agenda promotes, such as electric vehicles, are faltering. Once-dominant car industries in Germany and France are struggling to stay afloat in an increasingly competitive global market. While Europe imposes ideological standards, China manufactures more, better, and cheaper. Deindustrialization is no longer a threat—it’s a fact. Notably, some factions on the Left even embrace “degrowth”—deliberate economic decline—as a desirable path.

Worse still, despite all these sacrifices, Europe continues to import Russian energy—now via third countries—and remains vulnerable to geopolitical pressure. The promise of energy independence often rings hollow.

The Green Deal has morphed from a promise of modernization into a political myth: a story no longer grounded in reality, propped up by propaganda that refuses to confront its contradictions. The public, increasingly aware of the real costs, is beginning to push back. The farmers’ resistance in the Netherlands gave rise to a political party now part of the ruling coalition. In other countries, protests and citizen discontent are multiplying. And this is only the beginning. This very week, farmers returned to Brussels to protest the suffocating policies they face.

An energy transition is not inherently harmful, but cannot be imposed dogmatically. It requires realism, technological pluralism, gradual implementation, and a willingness to adopt what works. Nuclear, hydro, and natural gas must be part of the energy mix while green technologies mature. Sustainability will not be achieved by denying physics or punishing citizens, but by integrating every available tool with a long-term vision.

What happened in Spain is a symptom, not an accident.

Europe’s current energy model is not equipped to operate under the conditions imposed by Brussels. There is an urgent need to rethink energy policy—not through ideology, but through engineering, economics, and common sense. If the energy transition is to be our path forward, let it be pursued with caution, technological plurality, and respect for the system’s real limitations.

Europe cannot afford to stumble in the dark in the name of a green light; it still does not know how to switch on.

Tyler Durden Tue, 07/08/2025 - 02:00

Australia's Latest Temporary Military Deployment To Europe Is Connected To Containing China

July 7, 2025 - 11:25pm

Australia's Latest Temporary Military Deployment To Europe Is Connected To Containing China

Authored by Andrew Korybko via Substack,

Australia agreed during last month’s NATO Summit to deploy an E-7 Wedgetail airborne early warning and control aircraft and up to 100 troops to Europe till November at the bloc and Poland’s request in support of Ukraine. This will be carried out under “Operation Kudu”, which “is the Australian Defence Force commitment to the training of Armed Forces of Ukraine personnel in the United Kingdom.” It follows a prior such deployment to Ramstein Air Base so the latest one isn’t really all that newsworthy.

That doesn’t mean that it’s insignificant, however, since it’s important for observers to understand why Australia is continuing to militarily involve itself in a conflict on the opposite side of the planet. The reason is that Australia is doing so as a quid pro quo for Anglo-American support in containing China through AUKUS. Regardless of whether one agrees with it, the Australia government nowadays considers China to be an adversary – largely due to Anglo-American influence – and formulates policy accordingly.

Sending arms to Ukraine, training its troops in the UK, and once again carrying out a temporary military deployment to Europe isn’t just a way to pay back its AUKUS allies, but also a means for obtaining experience in the event that China gets involved in a regional conflict. Whether it’s against Taiwan, the Philippines, Japan, and/or the US, Australia expects to involve itself in a similar way as with Russia-Ukraine via the aforesaid means of arms shipments, training, and early warning and control missions.

Moreover, by showing solidarity with NATO in its proxy war on Russia through Ukraine as explained above, Australia hopes that the bloc’s European members will repay the favor if it involves itself in a future AUKUS+ (AUKUS, Taiwan, Japan, and the Philippines) proxy war on China. Even though they’d probably do this at their American “daddy’s” behest, albeit as a quid pro quo for “defending Europe from Russia” in this case (as they sincerely but wrongly believe), it’s a suitable pretext for the public.

The larger goal is to craft the perception of a “Global West” that stretches across the Atlantic and Pacific to encompass both halves of Eurasia, thus enabling the US to “Lead From Behind” in containing China in the future and maybe once again Russia too depending on events. Australia’s role is therefore to serve as an example of an Asia-Pacific country contributing to the European front of the US’ present containment campaign against Russia to justify European countries contributing to a future Asian front against China.

That being the case, Australia’s latest temporary military deployment to Europe actually advances a much grander strategic goal than most observers might have realized. In and of itself, Australia’s contribution to NATO’s proxy war on Russia through Ukraine is minimal and has no influence over the course of events, but it helps lay the ground for what might come next after that conflict finally ends. If Trump’s “total reset” with China fails, then the US-led “Global West” might more aggressively contain it.

To that end, the precedent of Australia’s continued military involvement in the Ukrainian Conflict can be spun as the pretext for NATO’s European members involving themselves in a future AUKUS+ proxy war on China, which can be sold to the public as “paying back the favor out of solidarity”. The emerging “Global West” concept therefore isn’t just a “collection of democracies” like it’s been portrayed by some, but a collection of US military partners that can be relied upon for helping to contain its Eurasian rivals.

Tyler Durden Mon, 07/07/2025 - 23:25

How New Microschool Accreditation Pathways Are Opening Doors For Founders and Families

July 7, 2025 - 10:35pm

How New Microschool Accreditation Pathways Are Opening Doors For Founders and Families

Authored by Kerry McDonald via The Epoch Times (emphasis ours),

As a mother of nine in Tennessee, Sarah Fagerburg tried a variety of different schooling types, from public schools to homeschooling, but she always felt there had to be something better. In the spring of 2023, she discovered Acton Academy from listening to a podcast, and knew that this was the educational model she had been seeking.

MCP Academy in Mansfield, Texas/FEE

“My mind was blown,” said Fagerburg. “I had no idea education could be this good.”

She applied to open her own Acton Academy, and was accepted into the fast-growing network of approximately 300 independently operated schools, emphasizing learner-driven education. Fagerburg launched Acton Academy Johnson City last fall with 13 students, including four of her own children. Today, she has 26 K-6 students enrolled in her secular microschool, with plans to add a middle school and high school program in the coming years. “Parents want this. They love it,” said Fagerburg, adding that some families drive up to 45 minutes each way for their children to attend her program.

She says she sees enormous demand for the Acton Academy model, and hopes to open more locations in Tennessee, but access is a key concern. “I grew up poor,” said Fagerburg. “I never would have been able to attend a school like this.”

With the current expansion of school choice programs, such as Tennessee’s new universal education savings accounts (ESA), many more families are able to access innovative schools and learning models. “It’s a complete game changer,” said Fagerburg, explaining how the ESA program enables Tennessee families who previously had limited education choices to now use a portion of state-allocated education funding to select the school or learning space that is best for their child.

But there’s a catch. In order to participate in Tennessee’s ESA program, Fagerburg’s school must be accredited, and its current accreditation by the International Association of Learner Driven Schools isn’t recognized by the state.

That is why Fagerburg jumped at the opportunity to participate in a fledgling program offered through the Middle States Association (MSA), one of the four major K-12 accreditation entities, with 3,200 member schools worldwide. In partnership with Stand Together Trust, MSA’s Next Generation Accreditation pilot program seeks to offer a faster, more affordable, and more flexible route toward accreditation for today’s emerging schools.

“We created this flexible protocol around how a school actually works,” said Christian Talbot, President and CEO of MSA. “That gives mostly microschools, but really any innovative school, the opportunity to tell their story with the production of evidence that makes the most sense to them.”

Talbot offered the example of a hypothetical urban “place-based” learning environment, with no designated school building and students taking classes at various museums, public parks, and historic sites throughout a city. “That school is going to have the opportunity to describe the learning environment in ways that existing accreditation protocols really don’t allow because you have to have a certificate of occupancy, or a lease, or some other thing that is tied to this mental model we have that school has to be in a building,” said Talbot.

He emphasized that these innovative schools are “meeting all of the exact same standards of accreditation” as conventional schools, but they are able to demonstrate these standards in ways that reflect the ingenuity of their models.

MSA is the world’s second-oldest accrediting agency. It launched more than a century ago, as interest grew from schools and colleges for independent, third-party verifiers of quality. For higher education, accreditation eventually became a requirement for US colleges and universities to participate in federal student financial aid programs, but at the K-12 level, mandatory accreditation is less common.

Most states don’t require schools—public or private—to be accredited, but some schools choose to become accredited to earn an external “seal of approval,” which may help them to attract and retain students and educators. With the expansion of school-choice programs nationwide in recent years, certain states, such as Tennessee and Texas, require accreditation in order for a school to participate in these programs.

Cammy Herrera had been exploring the possibility of accreditation for her secular microschool MCP Academy, in Mansfield, Texas, well before the state introduced a new universal school-choice program this spring. A former public school teacher, Herrera had been running a licensed in-home preschool for more than a decade when she decided in 2021 to add a Montessori-inspired school-age program. She now serves over 50 students through middle school, with plans to open a high school if she can find a larger space to accommodate more students.

For Herrera, accreditation was appealing as a signal of quality, but she felt that most existing accrediting organizations took a traditional view of education that didn’t reflect her personalized, flexible approach.

“Our school is so different. We are not trying to fit into a one-size-fits-all box when it comes to schooling,” said Herrera, whose students are technically considered homeschoolers. They can attend her school full-time at an annual tuition of $10,250, or customize their enrollment based on their own learning needs. Tuition for Herrera’s two-day-a-week option is about $4,000 annually. “Whoever we get accredited through has to believe in our vision and has to be on board with what makes our school special because we don’t want our school to lose that special part that makes us different from a traditional school,” she said.

When Herrera learned about the MSA’s pilot accreditation program for microschools, she eagerly applied. Next Generation Accreditation would offer Herrera that third-party validation she has been seeking while retaining her program’s originality. It would also enable her to participate in Texas’s new school choice program, should she choose.

MSA hopes to run the Next Generation Accreditation pilot with 10 to 15 innovative schools over the next several months to learn more about these schools’ distinct needs and structures, and then iterate and adapt protocols to provide a valuable accreditation pathway for today’s creative schooling models.

As the creator of the Texas Microschools Facebook group, Herrera sees mounting interest in microschooling and the diverse educational models and methods that the movement fosters. She thinks that accreditation options that reflect this diversity can be beneficial to founders and families who value that credential, or who need it to participate in certain school-choice programs. But she also warns of potential drawbacks: “There are all these special schools, and if everybody has to follow the same standards to be accredited, then I think they’ll be more alike than different. That’s the only thing I could see being a downfall.”

Originally published on The74, reposted from the Foundation for Economic Education (FEE)

Tyler Durden Mon, 07/07/2025 - 22:35

Tipping Point: When Populations Peak

July 7, 2025 - 10:10pm

Tipping Point: When Populations Peak

As July 11 marks World Population Day, celebrating the approximate day that the world's population reached 5 billion on July 11, 1987, Statista's Felix Richter takes a closer look at one of the population trends that will affect many countries sooner or later in the 21st century: population decline. Especially prevalent across Europe and developed Asia, this demographic trend is a consequence of declining birth rates and ageing populations and poses significant challenges to the countries affected.

You will find more infographics at Statista

In countries like Japan and Italy, where population decline is estimated to have begun in 2010 and 2014, respectively, fertility rates have fallen below the replacement level of 2.1 percent a while ago. Influenced by factors such as higher education and career opportunities for women, shifts in societal norms regarding family and childbearing and an ageing overall population, natural population change, i.e. the difference between births and deaths, turned negative years ago. For several years, positive net migration stopped the overall population from declining until the (negative) natural population change eventually became larger than the population growth from migration.

Countries with declining populations face a number of challenges, both economic and social. Economically, a shrinking workforce can lead to labor shortages, reduced productivity and increased pressure on social welfare systems. With fewer working-age individuals to support a growing elderly population, the financial burden on pension systems and healthcare services intensifies. Socially, a declining population can result in the depopulation of rural areas, shrinking communities and the ensuing challenges in maintaining infrastructure and public services.

Addressing these issues requires comprehensive strategies. Raising the retirement age or increasing taxes/social contributions can help alleviate the financial burdens associated with a demographic imbalance. Policies to support work-life balance and affordable childcare can help slow the population decline and immigration of young, skilled workers can help address labor shortages and increase productivity.

According to the latest revision of the United Nation’s World Population Prospects, many countries will face these challenges within this century if they don't already, such as the aforementioned Japan and Italy, China and South Korea, which were expected to see their first population decline in 2021. Brazil's population is expected to start declining in 2042, France's in 2049 and even India’s vast population is projected to start shrinking in 2062.

Among developed nations, the United States, Canada and Australia are notable exception, with none of them currently expected to see their first population decline in the 21st century. Geographically, many African nations are still growing rapidly, resulting in a continental shift in global population that will see countries like Nigeria, the Democratic Republic of Congo, Ethiopia and Tanzania among the most populous nations in the world by 2100.

Tyler Durden Mon, 07/07/2025 - 22:10

Purges Of Top Tech Officials Show Cracks In China's Big Data Ambitions

July 7, 2025 - 9:45pm

Purges Of Top Tech Officials Show Cracks In China's Big Data Ambitions

Authored by Michael Zhuang via The Epoch Times (emphasis ours),

As U.S.-China tensions escalate over tech and national security, a new wave of corruption scandals is shaking the Chinese Communist Party’s (CCP) big data sector, one of the regime’s most strategically important industries.

The public visit Data Analysis Center during the 2017 China International Big Data Industry Expo at Guiyang International Eco-Conference Center in Guiyang, China, on May 27, 2017. Lintao Zhang/Getty Images

On July 2, Chinese state media reported that Yu Shiyang, head of the Big Data Development Department at China’s State Information Center, is under investigation for “serious violations of discipline and law,” a phrase widely understood in China to mean political misconduct or corruption.

In most cases, such investigations do not result in open trials. Instead, officials are often detained in secret, disappear from public view, and are quietly removed from their posts.

Yu is the latest in a growing list of high-level officials in China’s data and tech sector to fall from grace. Yu, who once held a visiting scholar position at MIT, was considered a rising star in China’s digital governance sector, an unusual profile for a CCP official due to his international experience. He also served as executive deputy director of the Internet and Big Data Center under the powerful National Development and Reform Commission, Beijing’s top economic planning agency.

The announcement was jointly issued by the Central Commission for Discipline Inspection, the CCP’s top anti-corruption body, and its counterpart in Hebei Province, underscoring the political weight behind the case.

Widespread Corruption at China’s Data Hub

The investigation into Yu is part of a broader pattern that has plagued China’s big data sector, particularly in Guizhou Province, which the CCP has touted as a national data hub since 2016. Once hailed as China’s first national-level big data experimental zone, Guizhou signed a landmark deal in 2018 allowing a local government-backed company, Guizhou-Cloud Big Data, to partner with Apple in operating iCloud services within mainland China.

However, behind the scenes, Guizhou’s data boom has become a political liability. Multiple senior officials spanning provincial data regulators, mayors, and executives at state-owned tech firms have been caught in sweeping anti-corruption probes.

Notable among them is Ma Ningyu, Guizhou’s former top big data official and the original architect of the province’s digital transformation strategy. He was detained in August last year amid allegations of abusing public data resources for private gain. Projects he championed are now under scrutiny for fraudulent procurement practices.

Another scandal involves Jing Yaping, who was purged on Feb. 24. Until her retirement, she led the provincial Big Data Development Bureau. She allegedly rigged bids for the Chinese regime’s IT contracts by embedding encryption watermarks in tender documents, ensuring her son-in-law’s shell company won lucrative contracts. The scheme reportedly caused a 2 billion yuan ($280 million) budget overrun.

Investigators also alleged that government servers under her watch were secretly used to mine Bitcoin. Authorities discovered 327 remaining Bitcoins in the mining pool, worth around $35 million at current valuations. The discovery was particularly problematic given Beijing’s 2021 blanket ban on cryptocurrency mining, citing energy waste and financial risk.

The purge shows no sign of slowing. On Feb. 26, Liu Lan, Guizhou’s deputy mayor overseeing big data, was removed from office, according to Chinese state media reports. On April 3, Yang Yunyong, head of a Guizhou provincial government-backed computing firm, was purged, and Li Gang, a former deputy director of Guizhou’s Big Data Bureau and provincial military-civil fusion office, fell under investigation on May 16.

CCP’s Big Data Ambitions

The fallout has raised alarm about the fragility of China’s efforts to build a global edge in artificial intelligence (AI). Big data is foundational to AI development, and Chinese leader Xi Jinping has long championed the integration of big data, artificial intelligence, and traditional industries since 2022.

On June 26, RAND Corporation, an influential American defense and policy think tank [ZH: also absolute dicks], warned that Beijing sees data as a strategic asset in its bid to become a dominant world power in the field of AI. China’s local governments have launched so-called “data marketplaces” that allow state agencies and companies to trade datasets. These platforms aim to standardize and commercialize data exchange between state and private entities, fueling AI development without formal data ownership transfer. The goal is to build up AI capabilities by widening access to large-scale training data.

In addition, big data is critical in the CCP’s attempts at foreign influence and espionage. Last year, Canadian intelligence chief Daniel Rogers raised national security concerns over China’s use of big data to carry out foreign interference activities. He specifically named the data held by TikTok as potentially being capable of ending up in the hands of the CCP.

The CCP also seeks to acquire and exploit big data for its military use. The U.S. State Department states on its website that China wants to become the first nation to transition to “intelligence warfare” via military-civil fusion, a strategy that includes theft to acquire advanced technologies, which include big data.

With top officials in Beijing’s data apparatus falling in rapid succession, the CCP’s ambitions for digital dominance may be unraveling from within.

Tang Bing contributed to this report.

Tyler Durden Mon, 07/07/2025 - 21:45

China Could Push Russia To Attack NATO Member In Taiwan Distraction Ploy: Rutte

July 7, 2025 - 9:20pm

China Could Push Russia To Attack NATO Member In Taiwan Distraction Ploy: Rutte

In the scenario that China might one day invade Taiwan, Beijing will enlist Russia's help to tie up NATO forces in Europe, according to a prediction by NATO Secretary-General Mark Rutte.

Rutte, in a fresh interview with The New York Times, engaged in a rare bit of public speculation and grand strategy chessboard gaming regarding potential future moves by the two nuclear armed powers who have struck an "unlimited partnership" of the last few years.

He described that if China made a move against Taiwan, President Xi Jinping "would first make sure that he makes a call to his very junior partner in all of this" - in reference to Russian President Vladimir Putin.

This isn't the first time that Rutte has branded Putin the Chinese president's subordinate in public remarks, in something clearly meant as a jab at Moscow and aimed at belittling the Russian leader.

In such a development, Xi would tell the Kremlin leader that Russia needs to "keep them busy in Europe by attacking NATO territory," Rutte said.

"That is most likely the way this will progress," he added, in an interview where he generally heaped a lot of praise on President Trump, including in the following:

"The American administration completely takes the view and shares it with the Europeans that this war in Ukraine is crucial for the defense of NATO territory going forward and that we have to make sure that Ukraine is in the strongest possible position to stop the Russians from taking more territory, and that when it comes to a cease-fire or, even better, a peace deal, that Ukraine with some help will be able to prevent Putin from ever attacking Ukraine again in the future."

One end result of Trump putting pressure on Europe to take a stronger and more lead role in shouldering the common defense burden is that "The Europeans have now cobbled together $35 billion in military aid this year to deliver to Ukraine, which is more than last year."

He said this came alongside the US expecting Europeans to "take more of the burden when it comes to the concrete support to Ukraine."

Watch the part of the interview where Rutte assumes China and Russia will coordinate action related to future moves on Taiwan:

NATO secretary-general Mark Rutte says if Xi Jinping decides to attack Taiwan, he'll call up his "junior partner" Putin and tell him to "keep them busy in Europe" by simultaneously attacking NATO territory. Rutte suggests this is one reason why Trump is so supportive of NATO pic.twitter.com/zsu1hlmJW7
— Michael Tracey (@mtracey) July 6, 2025

One additional area where Rutte praised Trump is on breaking the "deadlock" with Putin. "He is the one who broke the deadlock with Putin. When he became president in January, he started these discussions with Putin, and he was the only one who was able to do this," the NATO chief described.

"This had to happen. A direct dialogue between the American president and the president of the Russian Federation," he added. But Rutte also acknowledged that this has stopped progressing of late. As for the Moscow-Beijing relationship, he is likely assuming too much in terms of closeness between these longtime, historic rivals turned 'friends'.

Tyler Durden Mon, 07/07/2025 - 21:20

Walmart, Amazon Truck Depots Display Multilingual Signs, Raising Alarms Over Migrant Drivers With No English

July 7, 2025 - 8:55pm

Walmart, Amazon Truck Depots Display Multilingual Signs, Raising Alarms Over Migrant Drivers With No English

Submitted by American Truckers United,

In the shadow of record profits and centi-billion dollar valuations, the American trucker is being pushed further to the sidelines - not by automation or fuel prices, but by corporate betrayal.

Walmart and Amazon — icons of "American" capitalism — are now placing signs at their distribution centers in foreign languages to accommodate an influx of non-domiciled, non-citizen truck drivers. Don't be fooled… this isn't about inclusion, it's about replacing those more expensive American truck drivers.

Truck driving, once a blue-collar backbone of American prosperity, is being hollowed out in favor of cheap, foreign labor. Mega-corporations and their subcontractors are exploiting loopholes to flood the industry with drivers on work visas or temporary permits, often lacking any form of training to U.S. safety standards or language requirements. Safety and sovereignty are both being sacrificed at the altar of higher earnings per share.

Donald Trump's Executive Order demanding English Language Proficiency (ELP) enforcement for commercial drivers wasn't just common sense — it was a line in the sand. You drive on American highways? You speak the language. Period.

Likewise, Secretary of Transportation, Sean Duffy, sounded the alarm on the abuse of non-domiciled CDLs — licenses issued by states to foreign nationals who may never permanently reside in the U.S. These are not minor regulatory gaps. They're open floodgates, and big retail is swimming through them with glee… they even have the signs to prove it!

This is more than a labor dispute. It's a cultural and economic affront to every American trucker who played by the rules, paid their dues, and built this country mile by mile… "Covid's heroes" they once claimed… mega-corporation's collateral damage just a few short years later.

The real "supply chain crisis" isn't the worry of shelves running empty… it is what power that big retail will continue to build if they continue their pillage of American Truck drivers and companies while handing our national security interests/domestic supply chain to non-citizens.

* * *

ZeroHedge Take:

Under federal law, non-domiciled CDL (Commercial Driver's License) holders are required to understand and communicate in English. Yet, as the signage at Walmart distribution hubs and other major trucking depots reveals, instructions are now posted in foreign languages — a quiet admission that many of these unvetted migrant drivers don't speak English.

This is a growing public safety threat. Tens of thousands of non-domiciled drivers, some with questionable training and zero English proficiency, are now behind the wheel of 80,000-pound steel missiles barreling down U.S. highways.

Tyler Durden Mon, 07/07/2025 - 20:55

China Smartphone Sales Plunge In May; Device Camera Counts Peak

July 7, 2025 - 8:30pm

China Smartphone Sales Plunge In May; Device Camera Counts Peak

The latest data from Goldman Sachs shows smartphone shipments in China plunged 21% year-over-year in May to 23 million units. While shipments ticked up 1% month-over-month, they remain under pressure due to a high base effect from 2024, a particularly strong year in shipments. Cumulatively, shipments are down 5% year-to-date through May.

China's smartphone market in May

Smartphone shipments in China were -21% YoY to 23m units in May vs. -2% YoY in Apr 2025, per MIIT.
The number of new smartphone models launched in China was -27% YoY to 27 models in May 2025 vs. +14% YoY to 32 models in Apr 2025, per MIIT.

"For cameras, the number of cameras per phone peaked in 2022 at 3.8 cameras and was down to 3.3/ 3.1 cameras in 2024/ 2025 YTD; however, 20MPx+ penetration increased to 52%/ 51% in 2024/ 2025 YTD (vs. 39%/ 31% in 2023/22), in line with our view of camera specification upgrades for China smartphones," the team of analysts led by Allen Chang told clients over the weekend.

The 5G segment demonstrated relative strength, with shipments increasing 7% from April to 21 million units, representing an 89% market penetration rate. However, the number of new 5G models launched plunged 52% year-over-year to just 13.

Key China smartphone data in May (China 5G phone market in May):

5G phone shipments in China came in at 21m units in May, +7% MoM, -17% YoY, with a 89% penetration rate, per MIIT.
The number of new 5G smartphone models launched in China was -52% YoY to 13 models in May 2025 vs. -14% YoY to 19 models in Apr 2025, per MIIT.

Visualizing China's Smartphone Market In A Series Of Charts

Smartphone Pipeline

Chang forecasts shipment declines of 4% in Q2 and 2% in Q3, but highlights ongoing upgrades in hardware specifications and a shift toward premium models.

The analysts are "Buy" rated Hon Hai, AAC, Largan, Luxshare, SZS, Fositek, BYDE, Transsion, Will Semi, MediaTek, and TSMC.

Tyler Durden Mon, 07/07/2025 - 20:30

China Smartphone Sales Plunge In May; Device Camera Counts Peak

July 7, 2025 - 8:30pm

China Smartphone Sales Plunge In May; Device Camera Counts Peak

The latest data from Goldman Sachs shows smartphone shipments in China plunged 21% year-over-year in May to 23 million units. While shipments ticked up 1% month-over-month, they remain under pressure due to a high base effect from 2024, a particularly strong year in shipments. Cumulatively, shipments are down 5% year-to-date through May.

China's smartphone market in May

Smartphone shipments in China were -21% YoY to 23m units in May vs. -2% YoY in Apr 2025, per MIIT.
The number of new smartphone models launched in China was -27% YoY to 27 models in May 2025 vs. +14% YoY to 32 models in Apr 2025, per MIIT.

"For cameras, the number of cameras per phone peaked in 2022 at 3.8 cameras and was down to 3.3/ 3.1 cameras in 2024/ 2025 YTD; however, 20MPx+ penetration increased to 52%/ 51% in 2024/ 2025 YTD (vs. 39%/ 31% in 2023/22), in line with our view of camera specification upgrades for China smartphones," the team of analysts led by Allen Chang told clients over the weekend.

The 5G segment demonstrated relative strength, with shipments increasing 7% from April to 21 million units, representing an 89% market penetration rate. However, the number of new 5G models launched plunged 52% year-over-year to just 13.

Key China smartphone data in May (China 5G phone market in May):

5G phone shipments in China came in at 21m units in May, +7% MoM, -17% YoY, with a 89% penetration rate, per MIIT.
The number of new 5G smartphone models launched in China was -52% YoY to 13 models in May 2025 vs. -14% YoY to 19 models in Apr 2025, per MIIT.

Visualizing China's Smartphone Market In A Series Of Charts

Smartphone Pipeline

Chang forecasts shipment declines of 4% in Q2 and 2% in Q3, but highlights ongoing upgrades in hardware specifications and a shift toward premium models.

The analysts are "Buy" rated Hon Hai, AAC, Largan, Luxshare, SZS, Fositek, BYDE, Transsion, Will Semi, MediaTek, and TSMC.

Tyler Durden Mon, 07/07/2025 - 20:30

"Troops Could Vanish Like Squid": New Bio-Inspired Camo Lets US Soldiers Evade Sight And High-Tech Sensors Instantly

July 7, 2025 - 8:05pm

"Troops Could Vanish Like Squid": New Bio-Inspired Camo Lets US Soldiers Evade Sight And High-Tech Sensors Instantly

Authored by Eirwen Williams via the Sustainability Times,

The fusion of biology and technology continues to break new ground, as seen in a remarkable project funded by DARPA and the Air Force. By leveraging the natural abilities of cephalopods, particularly the squid, researchers are developing advanced camouflage technology for military applications.

Illustration of squid-inspired camouflage technology for military applications. Image generated by AI.

This bio-inspired innovation promises to revolutionize how soldiers hide in plain sight, adapting to various environments by mimicking the squid’s adaptive skin. Such breakthroughs not only highlight the potential of bioinspired materials but also reinforce the crucial role of interdisciplinary research in defense and technology.

The Science Behind Squid-Inspired Camouflage

At the heart of this innovative research is the study of squid skin, particularly the light-reflecting cells known as iridophores. Researchers at the University of California, Irvine, in collaboration with the Marine Biological Laboratory in Woods Hole, Massachusetts, have delved into the unique cellular structures of the longfin inshore squid. These iridophores contain tightly coiled columns of a protein called reflectin. These proteins act like natural Bragg reflectors, enabling the squid to change colors rapidly and efficiently.

Through advanced imaging techniques such as holotomography, scientists have captured detailed three-dimensional views of these cells, revealing how the columns of reflectin twist and organize themselves to manipulate light. This ability allows the squid to transition from being transparent to displaying vibrant colors, a mechanism that could be pivotal in developing materials that mimic these changes for military use.

Engineering Bio-Inspired Materials for Defense

Building on the understanding of these biological structures, researchers have engineered a flexible composite material that replicates and even extends the optical capabilities of squid skin. This material combines the nanostructured Bragg reflectors with ultrathin metal films to enhance control over infrared light. Such a composite can adjust its appearance across both visible and infrared spectrums, making it an ideal candidate for adaptive camouflage and other advanced applications.

By responding to environmental stimuli, such as changes in light or physical manipulation like stretching and bending, the material can dynamically alter its properties. This adaptability opens doors to a range of applications beyond military use, including smart textiles and thermal-management systems. The scalability of the fabrication techniques used also means that these materials can be produced on a larger scale, potentially transforming industries beyond defense.

“Concrete That Heals Itself”: Scientists Create Lichen-Inspired Material That Uses Microbes to Seal Cracks Automatically

Potential Beyond Camouflage

This breakthrough in biomimicry extends beyond just camouflage. The principles used to develop these materials could enhance a variety of other technologies. The design concepts drawn from cephalopods may improve devices like lasers, fiber-optic filters, photovoltaic coatings, and chemical sensors. The ability to fine-tune optical properties dynamically is a game-changer for these applications, offering new levels of precision and control.

As researchers continue to explore the possibilities, the full potential of cephalopod-inspired optics is yet to be realized. The work conducted at UC Irvine and its collaborators exemplifies how nature can inspire cutting-edge technological advancements, pushing the boundaries of what is possible in material science and engineering.

Challenges and Future Directions

Despite the promising outcomes, challenges remain in bringing these technologies to practical applications. Issues such as cost, durability, and integration into existing systems must be addressed. Moreover, ethical considerations regarding the use of such technology in defense and surveillance need careful evaluation.

Looking forward, researchers aim to refine these bio-inspired materials, optimizing them for real-world applications. The interdisciplinary nature of this research, combining biology, engineering, and material science, underscores the importance of collaboration in solving complex problems. As we continue to draw inspiration from the natural world, the question remains: how will these innovations shape the future of technology and defense?

As this research progresses, the implications extend beyond the military, potentially influencing various industries and everyday life. The integration of biological insights into technological advancements poses a thought-provoking question: how far can we push the boundaries of biomimicry, and what ethical considerations will arise as we increasingly blur the lines between nature and technology?

Tyler Durden Mon, 07/07/2025 - 20:05

"Troops Could Vanish Like Squid": New Bio-Inspired Camo Lets US Soldiers Evade Sight And High-Tech Sensors Instantly

July 7, 2025 - 8:05pm

"Troops Could Vanish Like Squid": New Bio-Inspired Camo Lets US Soldiers Evade Sight And High-Tech Sensors Instantly

Authored by Eirwen Williams via the Sustainability Times,

The fusion of biology and technology continues to break new ground, as seen in a remarkable project funded by DARPA and the Air Force. By leveraging the natural abilities of cephalopods, particularly the squid, researchers are developing advanced camouflage technology for military applications.

Illustration of squid-inspired camouflage technology for military applications. Image generated by AI.

This bio-inspired innovation promises to revolutionize how soldiers hide in plain sight, adapting to various environments by mimicking the squid’s adaptive skin. Such breakthroughs not only highlight the potential of bioinspired materials but also reinforce the crucial role of interdisciplinary research in defense and technology.

The Science Behind Squid-Inspired Camouflage

At the heart of this innovative research is the study of squid skin, particularly the light-reflecting cells known as iridophores. Researchers at the University of California, Irvine, in collaboration with the Marine Biological Laboratory in Woods Hole, Massachusetts, have delved into the unique cellular structures of the longfin inshore squid. These iridophores contain tightly coiled columns of a protein called reflectin. These proteins act like natural Bragg reflectors, enabling the squid to change colors rapidly and efficiently.

Through advanced imaging techniques such as holotomography, scientists have captured detailed three-dimensional views of these cells, revealing how the columns of reflectin twist and organize themselves to manipulate light. This ability allows the squid to transition from being transparent to displaying vibrant colors, a mechanism that could be pivotal in developing materials that mimic these changes for military use.

Engineering Bio-Inspired Materials for Defense

Building on the understanding of these biological structures, researchers have engineered a flexible composite material that replicates and even extends the optical capabilities of squid skin. This material combines the nanostructured Bragg reflectors with ultrathin metal films to enhance control over infrared light. Such a composite can adjust its appearance across both visible and infrared spectrums, making it an ideal candidate for adaptive camouflage and other advanced applications.

By responding to environmental stimuli, such as changes in light or physical manipulation like stretching and bending, the material can dynamically alter its properties. This adaptability opens doors to a range of applications beyond military use, including smart textiles and thermal-management systems. The scalability of the fabrication techniques used also means that these materials can be produced on a larger scale, potentially transforming industries beyond defense.

“Concrete That Heals Itself”: Scientists Create Lichen-Inspired Material That Uses Microbes to Seal Cracks Automatically

Potential Beyond Camouflage

This breakthrough in biomimicry extends beyond just camouflage. The principles used to develop these materials could enhance a variety of other technologies. The design concepts drawn from cephalopods may improve devices like lasers, fiber-optic filters, photovoltaic coatings, and chemical sensors. The ability to fine-tune optical properties dynamically is a game-changer for these applications, offering new levels of precision and control.

As researchers continue to explore the possibilities, the full potential of cephalopod-inspired optics is yet to be realized. The work conducted at UC Irvine and its collaborators exemplifies how nature can inspire cutting-edge technological advancements, pushing the boundaries of what is possible in material science and engineering.

Challenges and Future Directions

Despite the promising outcomes, challenges remain in bringing these technologies to practical applications. Issues such as cost, durability, and integration into existing systems must be addressed. Moreover, ethical considerations regarding the use of such technology in defense and surveillance need careful evaluation.

Looking forward, researchers aim to refine these bio-inspired materials, optimizing them for real-world applications. The interdisciplinary nature of this research, combining biology, engineering, and material science, underscores the importance of collaboration in solving complex problems. As we continue to draw inspiration from the natural world, the question remains: how will these innovations shape the future of technology and defense?

As this research progresses, the implications extend beyond the military, potentially influencing various industries and everyday life. The integration of biological insights into technological advancements poses a thought-provoking question: how far can we push the boundaries of biomimicry, and what ethical considerations will arise as we increasingly blur the lines between nature and technology?

Tyler Durden Mon, 07/07/2025 - 20:05

How Much Revenue Do Tech Giants Earn Per Employee?

July 7, 2025 - 7:40pm

How Much Revenue Do Tech Giants Earn Per Employee?

Which tech companies are generating the most profit per employee?

In this graphic, Visual Capitalist's Marcus Lu visualized 22 major tech companies by revenue per employee in 2024, highlighting the efficiency of business models that monetize user-generated content.

The data for this visualization comes from Multiples.

Revenue per Employee Leaders

OnlyFans, Valve, and YouTube are the top three leaders in this dataset. All three are digital platforms that have successfully scaled up with a relatively small workforce.

OnlyFans has 51-200 employees according to LinkedIn, while Valve operates Steam, the world’s largest PC gaming platform, with a workforce of just 350 people. YouTube has the largest headcount of the three, with 7,173 employees as of January 2024.

By leveraging user-generated content (OnlyFans and YouTube) or digital distribution strategies (Valve), these companies differ from traditional companies that rely on labor-intensive operations.

The Origins of OnlyFans

OnlyFans was founded in 2016 by British entrepreneur Tim Stokely as a subscription-based platform where creators could monetize content directly from fans, initially targeting fitness influencers and lifestyle personalities.

The platform’s growth accelerated during the COVID-19 pandemic, and has become extremely popular in the adult entertainment industry.

In 2018, Stokely sold 75% of OnlyFans’ parent company to Ukranian-American billionaire Leonid Radvinsky, and later stepped down as its CEO in 2021.

If you enjoyed today’s post, check out America’s Top 25 Companies by Revenue on Voronoi, the new app from Visual Capitalist.

Tyler Durden Mon, 07/07/2025 - 19:40

How Much Revenue Do Tech Giants Earn Per Employee?

July 7, 2025 - 7:40pm

How Much Revenue Do Tech Giants Earn Per Employee?

Which tech companies are generating the most profit per employee?

In this graphic, Visual Capitalist's Marcus Lu visualized 22 major tech companies by revenue per employee in 2024, highlighting the efficiency of business models that monetize user-generated content.

The data for this visualization comes from Multiples.

Revenue per Employee Leaders

OnlyFans, Valve, and YouTube are the top three leaders in this dataset. All three are digital platforms that have successfully scaled up with a relatively small workforce.

OnlyFans has 51-200 employees according to LinkedIn, while Valve operates Steam, the world’s largest PC gaming platform, with a workforce of just 350 people. YouTube has the largest headcount of the three, with 7,173 employees as of January 2024.

By leveraging user-generated content (OnlyFans and YouTube) or digital distribution strategies (Valve), these companies differ from traditional companies that rely on labor-intensive operations.

The Origins of OnlyFans

OnlyFans was founded in 2016 by British entrepreneur Tim Stokely as a subscription-based platform where creators could monetize content directly from fans, initially targeting fitness influencers and lifestyle personalities.

The platform’s growth accelerated during the COVID-19 pandemic, and has become extremely popular in the adult entertainment industry.

In 2018, Stokely sold 75% of OnlyFans’ parent company to Ukranian-American billionaire Leonid Radvinsky, and later stepped down as its CEO in 2021.

If you enjoyed today’s post, check out America’s Top 25 Companies by Revenue on Voronoi, the new app from Visual Capitalist.

Tyler Durden Mon, 07/07/2025 - 19:40

Oil Closes At Session High As Houthi Rebels Hit Second Greek Vessel In Red Sea

July 7, 2025 - 7:15pm

Oil Closes At Session High As Houthi Rebels Hit Second Greek Vessel In Red Sea

By Charles Kennedy of OilPrice.com

A Greek-operated bulk carrier was attacked in the Red Sea on Monday in the second Houthi strike on commercial shipping in less than 24 hours, stoking fears of a renewed escalation in one of the world’s most critical oil transit corridors, Arab and Israel media report.

The Eternity C, a Liberia-flagged vessel managed by Athens-based Cosmoship, was hit off Yemen’s Hodeidah coast using a combination of sea drones, rocket-propelled grenades, and small arms. Two seafarers were seriously injured and two more are missing, according to shipping intelligence sources cited by media. The vessel was reportedly en route to Iran with a cargo of steel.

The attack follows Sunday’s strike on the Magic Seas, another Greek-managed bulk carrier. Houthi militants claim the Magic Seas has sunk. That vessel was hit southwest of Hodeidah and its crew abandoned ship before rescue. Both ships are Liberia-flagged, and neither was carrying Israeli cargo, according to tracking data.

Shortly after the second attack, on Monday at 3:31 p.m. ET, Brent crude was trading up 2.08% at $69.72, near session high, while WTI was trading up 2.39% at $68.09; both ignored the weekend's bigger than expected OPEC+ output increase.

Insurance premiums for vessels crossing the Bab el-Mandeb strait have already increased, with underwriters signaling more exclusions are likely in coming days.

The renewed Red Sea volatility comes as Axios reports that Israeli officials believe Donald Trump would authorize pre-emptive military action against Iran’s nuclear program if he returns to office. Israeli Prime Minister Benjamin Netanyahu is expected to raise the issue during a closed-door dinner with Trump this week. Tehran has restarted centrifuge operations at key enrichment sites, setting off fresh alarm in Tel Aviv.

Tyler Durden Mon, 07/07/2025 - 19:15

Oil Closes At Session High As Houthi Rebels Hit Second Greek Vessel In Red Sea

July 7, 2025 - 7:15pm

Oil Closes At Session High As Houthi Rebels Hit Second Greek Vessel In Red Sea

By Charles Kennedy of OilPrice.com

A Greek-operated bulk carrier was attacked in the Red Sea on Monday in the second Houthi strike on commercial shipping in less than 24 hours, stoking fears of a renewed escalation in one of the world’s most critical oil transit corridors, Arab and Israel media report.

The Eternity C, a Liberia-flagged vessel managed by Athens-based Cosmoship, was hit off Yemen’s Hodeidah coast using a combination of sea drones, rocket-propelled grenades, and small arms. Two seafarers were seriously injured and two more are missing, according to shipping intelligence sources cited by media. The vessel was reportedly en route to Iran with a cargo of steel.

The attack follows Sunday’s strike on the Magic Seas, another Greek-managed bulk carrier. Houthi militants claim the Magic Seas has sunk. That vessel was hit southwest of Hodeidah and its crew abandoned ship before rescue. Both ships are Liberia-flagged, and neither was carrying Israeli cargo, according to tracking data.

Shortly after the second attack, on Monday at 3:31 p.m. ET, Brent crude was trading up 2.08% at $69.72, near session high, while WTI was trading up 2.39% at $68.09; both ignored the weekend's bigger than expected OPEC+ output increase.

Insurance premiums for vessels crossing the Bab el-Mandeb strait have already increased, with underwriters signaling more exclusions are likely in coming days.

The renewed Red Sea volatility comes as Axios reports that Israeli officials believe Donald Trump would authorize pre-emptive military action against Iran’s nuclear program if he returns to office. Israeli Prime Minister Benjamin Netanyahu is expected to raise the issue during a closed-door dinner with Trump this week. Tehran has restarted centrifuge operations at key enrichment sites, setting off fresh alarm in Tel Aviv.

Tyler Durden Mon, 07/07/2025 - 19:15

Jane Street & The Regulatory "Risk" In Risk-Reversals

July 7, 2025 - 6:25pm

Jane Street & The Regulatory "Risk" In Risk-Reversals

Via SpotGamma Substack,

Days ago India barred Jane Street (JSG) from its security market, citing manipulation of markets.

TLDR: We think JSG knew options skews could be heavily distorted, and traded large options positions trying to take advantage of the distortion.

Additionally - a disclaimer: We have no idea what really happened, and we did our best to accurately quote from the SEBI & other documents. We have no idea if anyone is guilty of anything, nor are we alleging that. If anything in here is incorrect, we will do our best to update the post.

The Indian regulatory body, SEBI, launched the investigation “Based on media reports titled ‘Jane Street-Millennium Suit: ‘Secret’ Strategy Concerns India, Hearing Reveals’ and ‘Ex-Jane Street trader pillories claims he stole trade secrets’, published during April 2024 wherein it was inter-alia mentioned that Jane Street and its associated entities alleged unauthorised use of their proprietary trading strategies in Indian options markets…”

This recent banning was related to a 2024 regulatory investigation (and warning to JSG) into short-dated index options trading. After that ‘24 investigation, SEBI, India’s market regulator, accused Jane Street of manipulating the BANKNIFTY index on expiry day using aggressive futures flow and deeply skewed 0DTE option structures — a strategy that mirrors the same tactics Jane Street would later allege were stolen in its U.S. lawsuit against Millennium (more on this later)

Critical to this, understand that Jane Street is/was not a registered market-maker in India’s options market. But according to SEBI’s 2024 interim order, they behaved like the most aggressive one in the room.

SEBI found that the Jane Street Group ("JSG") ran the single largest risk-adjusted book on BANKNIFTY index expiry days. One day stood out above the rest: January 17, 2024.

On element left from the report was that the day before, January 16, BANKNIFTY fell more than 4% following disappointing earnings from HDFC Bank. The January 17 session opened lower again — creating a setup where options prices were likely skewed to the extremes.

On Jan 17 SEBI estimates JSG made ₹662 crore (~$79M USD) that day using what they call an "Intraday Index Manipulation" strategy. The allegation? That Jane Street pushed BANKNIFTY higher in the morning by aggressively buying stocks and futures, built massive short-delta positions in 0DTE options while the index was artificially elevated, and then sold their equities to drive the index lower and monetize the short-delta.

This is also the depiction you hear on social media. But, as with most things, there is way more nuance.

Both the equities market and the options market opened at 9:15 AM IST. Jane Street began executing its strategy immediately. From 9:15 to 11:45 AM, JSG bought ₹4,370 crore ($525M) of BANKNIFTY futures and stocks. This alone accounted for 15–25% of total traded value in those names. Simultaneously, they shorted delta* to the tune of ₹32,115 crore ($3.9B) via 0DTE options — selling calls and buying puts.

In plain terms, Jane Street put on a massive intraday risk reversal by selling same day expiration (a.k.a. 0DTE) at-the-money (ATM) calls vs ATM puts.

*As we noted before, the BANKNIFTY was down 4% the prior day, and was opening ~1% lower on the morning of the 17th. This is critical to understand, because they SEBI report goes to great lengths to detail the alleged delta exposure that JSG carried. With great respect to the regulator, we think that depicting accurate deltas into wild vols/skews is rather difficult.

I suspect that Jane Street likely anticipated that volatility skew would be heavily mispriced at the open, potentially due to the prior day's steep index decline. When the market opened, they bought futures and stock simultaneously against extremely skewed options — selling richly priced calls and buying heavily discounted puts. This structure effectively established risk reversals vs long futures to exploit the skew differential.

Initially, the position may have been close to delta-neutral — designed not for directionality, but to mine the skew. This is likely why they were buying stock (positive delta trades) and futures as they were entering into risk reversals (negative delta trades). Further, as the day progressed and the skew normalized, Jane Street ceased additional accumulation (per charts below).

What made the setup unique was the sheer distortion in option pricing. At 9:15 AM, spot BANKNIFTY was trading at 46,814. The 46,800 ATM call was priced at ₹653.45 (blue); the ATM put, just ₹123.55 (red). While we have not studied Indian options prices before, one would expect ATM calls and puts to have much more similar prices.

This inverted skew suggests calls were extremely rich vs puts, a perfect setup for the trade JSG implemented. By day’s end, that call expired nearly worthless (₹0.65), while put values exploded.

This is a clear breakdown of put-call parity, one that SEBI argues was engineered by Jane Street itself. Their aggressive equity buying misled other participants and skewed IV pricing, particularly in the ATM strikes, allowing JSG to put on the risk reversal at an extreme edge.

SEBI writes: “Participants in index options markets [were] misled by the support for BANKNIFTY.” The strategy was not just delta directional — it was vol- and skew-sensitive. Jane Street created short-term realized vol and harvested convexity on both sides.

Notably, option volumes themselves appeared to collapse once the skew normalized. The SEBI states that JSG’s flow was the primary driver of the distorted vol surface that they were mining. We think this is the critical piece which the argument rotates around - did they knowing create this skew or was it the result of market volatility?

By 11:47 AM, Jane Street began unwinding their long equity exposure as you can see above (bottom 2 bar plots). At this same time, the options volume dies out (center plot). SEBI notes that their selling was again aggressive and concentrated in BANKNIFTY components, disproportionately moving the index lower and inflating the value of their long puts.

They reportedly closed some positions, letting others expire ITM. Though they booked losses on equities, the options PnL overwhelmed it. SEBI estimates a ₹662 crore net profit.

This apparently wasn't a one-off. SEBI identified 15 other days using this same blueprint, plus 3 additional instances where Jane Street employed a variant: the "Extended Marking the Close" strategy. This involved building large delta positions in options during the day, followed by an aggressive equity ramp or selloff into the expiry window to influence the settlement print.

How Does the Jane Street Millennium Lawsuit Tie In?

In April 2024, Jane Street sued Millennium and two former traders, alleging misappropriation of a confidential strategy. The complaint describes an SPX-based strategy developed over six years, involving:

Identification of latent market inefficiencies
Use of intra-day models and machine-learning-driven heuristics
"Expensive investigative trades" to test signal robustness
A framework to predict directional bias based on a fusion of signal inputs and execution behavior

Jane Street claims this strategy was unique and counterintuitive, and that its IP centered on exploiting subtle, repeatable intraday price dynamics. Internal chat logs cited in the complaint show the strategy was so profitable they considered hiding it from internal PnL tallies to avoid attracting attention.

Jane Street alleges that immediately after the traders joined Millennium, a new competitor began mirroring their trades via the same broker infrastructure, including specific order types and risk throttles. The broker even paused execution due to the similarity in patterns. Jane Street's own profits reportedly collapsed concurrently.

The Millennium lawsuit makes the BANKNIFTY trades even more revealing. According to Jane Street’s own complaint, their core strategy was explicitly designed to detect and trade on skewed volatility surfaces. It wasn’t just about forecasting direction — it was about identifying mispriced convexity and exploiting it through engineered flow. The “expensive investigative trades” described in the lawsuit align almost perfectly with the behavior SEBI observed in India: buying up underlying stocks to shift implied vols, then harvesting the reversion through options.

In both cases, infrastructure mattered — Jane Street touted proprietary execution pipelines, broker logic, and near-automated rebalancing. The precision seen on January 17 — with flow ramping at open, peaking by 11:45, and reversing in size — fits the exact framework Jane Street claimed was stolen.

If Jane Street had a strategy designed to weaponize short-term volatility dislocations using index-linked options and coordinated flows in the underlying, SEBI’s findings suggest it was indeed deployed.

Subscribe to SpotGamma's high frequency expert options analysis here...

Tyler Durden Mon, 07/07/2025 - 18:25