The metaphorical Jack had a great idea, open a coffee shop where the beverages were free and use internal advertising as the income subsidy to operate the business.  Crowds came for the free coffee, comfy couches, fellowship, conversation and enjoyment.

It didn’t matter where Jack got the coffee, how he paid for it, or didn’t, or what product advertising the customers would be exposed to while there.  Few people thought about such things.  Curiously, it didn’t matter what size the crowd was; in the backroom of Jack’s Coffee Shop they were able to generate massive amounts of never-ending free coffee at extreme scales.

Over time, using the justification of parking lot capacity and township regulations, not everyone would be able to park and enter.  Guards were placed at the entrance to pre-screen customers. A debate began.

Alternative coffee shops opened around town.  It was entirely possible to duplicate Jacks Coffee Shop, yet no one could duplicate the business model for the free coffee.  Indeed, there was something very unique about Jack’s Coffee Shop.  Thus, some underlying suspicions were raised:

The only way Twitter, with 217 million users, could exist as a viable platform is if they had access to tech systems of incredible scale and performance, and those systems were essentially free or very cheap.  The only entity that could possibly provide that level of capacity and scale is the United States Government – combined with a bottomless bank account.  A public-private partnership.

If my hunch is correct, Elon Musk is poised to expose the well-kept secret that most social media platforms are operating on U.S. government tech infrastructure and indirect subsidy.  Let that sink in.

The U.S. technology system, the assembled massive system of connected databases and server networks, is the operating infrastructure that offsets the cost of Twitter to run their own servers and database.  The backbone of Twitter is the United States government.

FREE COFFEE:

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CTH begins every outline of the ongoing Durham investigation with the following disclaimer:  How is John Durham going to reveal everything that is possible about the deep state Trump targeting operation, and simultaneously handle the involvement of Robert Mueller, Andrew Weissmann and the Special Counsel team who were specifically appointed to cover it up?

Thanks to a more detailed filing by John Durham last night {pdf here, h/t Techno}, we can now see the guardrails, rules and general direction the prosecution is taking.

In essence, the underlying Trump-Russia conspiracy theory material from the Clinton campaign, via Rodney Joffe to Michael Sussmann, was fabricated – likely for a dual purpose:

(A) to coverup and make excuses for the stunningly embarrassing, potentially unlawful and politically terrible April 2016 DNC email leaks, which showed the DNC Club internally working to secure the nomination for Hillary Clinton, while trying to destroy her primary opponent, Bernie Sanders.

and

(B) to create the political Russia narrative against Trump, to be deployed later in the general election.

Within the general direction Durham is following, the FBI was duped by a purposeful and manipulative intent from the Clinton campaign.  Meanwhile, the CIA [Agency-2] did not buy into the technological evidence saying it was not “technically plausible” and was “user created and not machine/tool generated.”   (more…)

Jumpin’ ju-ju bones, this is rather remarkable.  Two video segments from CNN today highlight just how horrible things are for Democrats this mid-term election year.  No amount of J6 leverage is going to offset the way Americans feel about Joe Biden.

Delivering a summary of the last four most recent and consecutive polls, even CNN had to report that President Joe Biden’s approval is the lowest ever for any president at this point in any presidency.  According to the CNN presentation, Joe Biden is “in a lot of trouble,” as outlined during a segment on CNN’s “New Day” with Brianna Keilar and John Berman.  WATCH:

The second segment is even worse news than the first.  In the second segment they take a look at all modern presidential polling and discover that Joe Biden has a lower approval rating than even Jimmy Carter in 1978.

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The social media and communication platform Twitter, responded to the bid by billionaire entrepreneur Elon Musk by announcing Friday the Twitter board of directors has unanimously adopted a “poison pill” defense in response to Tesla CEO Elon Musk’s proposal to buy the company and take it private. [LINK to Press Release]

Twitter said the move, formally called a “limited duration shareholder rights plan,” aims to enable its investors to “realize the full value of their investment” by reducing the likelihood that any one person can gain control of the company without either paying shareholders a premium or giving the board more time. Poison pills are often used to defend against hostile takeovers.

According to Twitter’s plan, if Musk or any other person or group acquires at least 15 percent of Twitter’s stock, the poison pill will trigger.

At that point, every other shareholder, aside from Musk, would be allowed to purchase new shares of Twitter at half the going market price, which stood at $45.08 at the closing bell on Thursday.

The flood of half-price shares would effectively dilute Musk’s ownership stake, making it massively more expensive for him to build up a controlling position.  Twitter said its board had voted unanimously in favor of the plan, which will remain in effect until April 14, 2023.

Obviously, the people in control of Twitter really do not want to lose control over the platform.  Elon Musk’s offer to purchase Twitter at $54.20 per share, represents a value of 38% more than his first shares purchased.  The public shareholders would make a sizeable return on their investment. However, the fiduciary responsibility of a board of directors to its shareholders is really not what this is about.

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Appearing on Stage in Vancouver earlier today with the head of TED Chris Anderson, Elon Musk discusses why he has made a financial bid to purchase the social media platform Twitter.  The video is prompted to 11:40 when Musk takes the stage, the first part of the conversation surrounds the Twitter announcement that had made global headlines only a few hours earlier.  WATCH:

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The richest man in the world, Tesla CEO Elon Musk, made an offer to purchase the Twitter platform for a price of $41 billion.  The offer represents a value of 38% more than the current evaluation.  [SEC FILING HERE]  The offer is filed with the US Securities and Exchange Commission proposing a full takeover for $54.20 per share in cash.

Within the filing Elon Musk states his intentions:

“I invested in Twitter as I believe in its potential to be the platform for free speech around the globe, and I believe free speech is a societal imperative for a functioning democracy.  However, since making my investment I now realize the company will neither thrive nor serve this societal imperative in its current form. Twitter needs to be transformed as a private company.

As a result, I am offering to buy 100% of Twitter for $54.20 per share in cash, a 54% premium over the day before I began investing in Twitter and a 38% premium over the day before my investment was publicly announced. My offer is my best and final offer and if it is not accepted, I would need to reconsider my position as a shareholder. Twitter has extraordinary potential.  I will unlock it. (SEC LINK)

What Elon Musk appears to be doing is perhaps the biggest story that few understand.

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CNBC commissioned a poll by Hart research and associates, a friendly outfit for the left.  Unfortunately, that means CNBC then needed to tell everyone what the results were [Full Poll pdf Here].  That task fell to CNBC’s Steve Liesman; an appropriate name given the task at hand.

The irony doubles when you remember this was the same CNBC pundit who refused to accept the horrible economic data that began surfacing last fall.  There was even a public broadcast where Liesman said the BLS statistics had to be wrong, because the results were so horrible.  A few months later, and here he is explaining how the country now feels about Joe Biden.   WATCH:

(CNBC) – […] The pessimism is clearly dragging on Americans’ opinions of President Joe Biden. In fact, nothing looks to be working in the Biden presidency from the public’s viewpoint.

The president’s approval rating sank to a new low of just 38%, with 53% disapproving. Biden’s -15% net approval rating is measurably worse than his -9% approval in the CNBC December survey. What’s more, his approval rating on the economy dropped for a fourth straight survey to just 35%, with 60% disapproving, putting the president a deep 25 points underwater. (article link)

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Yesterday in Iowa, Joe Biden called the Russian military operation in Ukraine a “genocide,” which has a very specific set of legal definitions to it.

When asked if he had seen enough evidence to support that statement Biden responded:

“Yes, I called it genocide.  It has become clearer and clearer that Putin is just trying to wipe out the idea of even being — being able to be Ukrainian.  And the amount — the evidence is mounting.  It’s different than it was last week.  The — more evidence is coming out of the — literally, the horrible things that the Russians have done in Ukraine.  And we’re going to only learn more and more about the devastation. And we’ll let the lawyers decide internationally whether or not it qualifies, but it sure seems that way to me.”  (link)

Several ground reports from European journalists indicate the U.S. military is running all of the combat operations inside Ukraine. A French reporter said on Euro News, “I thought I was with the international brigades, and instead I was facing the Pentagon.”  Now today, Joe Biden announces he is arbitrarily sending U.S. combat helicopters into the conflict.

[Tweet Link]

(WHITE HOUSE) – I just spoke with President Zelenskyy and shared with him that my Administration is authorizing an additional $800 million in weapons, ammunition, and other security assistance to Ukraine.

The Ukrainian military has used the weapons we are providing to devastating effect. As Russia prepares to intensify its attack in the Donbas region, the United States will continue to provide Ukraine with the capabilities to defend itself.

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Fed Governor Christopher Waller appeared on CNBC to announce we have reached peak inflation, and things will moderate from here.  All of these fed moves are political moves, not monetary policy-based moves. Here’s the thing they will never admit to the non-institutional investor.

The fed has been painfully slow to raise interest rates on purpose.  They did not make a mistake.  The reason for their delay is they needed to wait for the beginning of the first 2021 inflation wave to cycle through before they raised interest rates.  It’s a game of mirrors that almost no one sees.  WATCH:

The rate of inflation will drop once the statistical year-over-year comparisons reach the same moment in the prior year.  The fed will raise interest rates in May and then use the June inflation rate decline as a false talking point to highlight how their policy is working.  They wait for May, because they need to wait for the calendar, nothing else.  Inflation is measured as the percentage of change from the prior year.  By waiting until the inflation is measured against the first wave of rising prices, it will give the illusion of a decline in inflation.

So that’s why they waited.  But here’s the worse part….

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The “Producer Price Index” (PPI) is essentially the tracking of wholesale prices at three stages: Origination (commodity), Intermediate (processing), and then Final (to wholesale). Today, the Bureau of Labor and Statistics (BLS) released March price data [Available Here] showing a dramatic 11.2% increase year-over-year in Final Demand products at the wholesale level.  This is the fifth consecutive month with the highest rate of inflation the PPI ever recorded.

The single month increase in wholesale prices of 2.3% was driven by inflation built into the supply chain at every level that shows up in the final wholesale price.  Those price increases then get passed along to consumers along with the additional costs for warehousing, transportation and delivery.  I modified Table-A (FINAL DEMAND) to take out some of the noise.

Wholesale prices of goods jumped 2.3 percent in March, and the wholesale price of food products jumped 2.4 percent.  The total demand inflation compared to last year is 11.2 percent, the highest rate ever recorded since the PPI tracking was first started.

The total final demand monthly calculation (1.4%) is lower than the final demand goods (2.3%), because final demand services are offsetting.  You may remember the discussion/analysis about prices beginning to stabilize after this month due to a contraction in demand for goods and services.  I see support for that thesis within this data.

The three phases of wholesale product creation: (1) origination, (2) intermediate, and (3) final, cycle through the economic analysis in reverse chronological order.  Roughly speaking, the flow of goods quantified is done in 30-day sequences.  Final demand this month is comparing to final demand in March 2021.  The intermediate demand goods this month will become final demand goods next month (April).

The rate of inflation behind this set of final demand goods is beginning to soften.  See Table B, Intermediate goods.  Again, modified to take out the noise:

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