Saturday Weekend Edition.
"We are not negotiating details."
1. Financial Times:
The Trump administration has told Ukrainian and European officials there is little room to negotiate on its plan to end Russia’s war, as the US heaps pressure on Volodymyr Zelenskyy to sign a deal drawn up with Moscow’s help by Thursday.
US army secretary Daniel Driscoll told European ambassadors and western officials at a volatile meeting in Kyiv late on Friday that he was “optimistic that now is the time for peace” — but warned that Washington would show little flexibility.
“We are not negotiating details,” he said, according to a senior European official in the meeting at the Kyiv residence of US Chargé d’Affaires, Julie Davis. One senior European official described the tone of the meeting as “nauseating”.
News of the Kyiv discussion, coupled with President Donald Trump’s comments on Friday that Ukraine would “have to like” Washington’s deal, prompted late-night discussions among European leaders gathered for the G20 meeting in Johannesburg about how to intervene.
“It is time for the Trump whisperers to start shouting,” said one official briefed on the discussions.
The meeting in the ornate mansion in Kyiv’s historic Podil district came a day after the US’s 28-point plan surfaced. The discussion went sideways quickly, according to European officials present.
Davis told the group gathering in the mansion that “as much as we can support Ukraine continuing the war, there are limits”, said one ambassador present.
“There are strong indications that Russia has a strong industrial base and it is a matter of time until Ukraine has to cut a deal,” she said, according to the ambassador.
Driscoll showed up late and laced his comments with profanities, according to people present. “We need to get this shit done,” he said. (Source: ft.com)
2. Institute for the Study of War (ISW):
Russia’s battlefield successes are not inevitable, and the Kremlin is intensifying efforts to aggrandize recent Russian military activity to advocate that Ukraine surrender terrain in Donetsk Oblast that Russian forces are unlikely to actually seize without several years of campaigning. Russian forces seized approximately 908 square kilometers of additional territory (about the area of Berlin) in all of Ukraine since the Alaska summit between US President Donald Trump and Russian President Vladimir Putin on August 15. Some of these territorial gains were enabled by seasonal weather (fog and rain), which degraded Ukraine’s use of drones, and the rate of Russian advance will likely slow as weather conditions stabilize. Continued European military assistance and European-financed American weapons sales to Ukraine will likely enable Ukrainian forces to defend Ukraine’s Fortress Belt in Donetsk Oblast for several years, and possibly even reverse some Russian gains. Russia is facing mounting materiel, manpower, and economic challenges that will continue to compound and constrain Russia’s ability to resource the war as it protracts. Russia is therefore heavily vested in compelling Ukraine to surrender critical terrain that the Russian military is very unlikely to obtain by force on any rapid timeline. (Source: understandingwar.org)
3. Bloomberg:
Bitcoin is on track for its worst monthly performance since a string of corporate collapses rocked the wider crypto sector in 2022.
The largest cryptocurrency slid as much as 7.6% to $80,553, before paring losses on Friday. Runner-up Ether fell as much as 8.9% to below $2,700 and a host of smaller tokens nursed similar declines. The total market value of virtual coins dropped below $3 trillion for the first time since April, data from CoinGecko show.
Bitcoin has now shed about a quarter of its value in November, the most for a single month since June 2022, according to data compiled by Bloomberg. The implosion of Do Kwon’s TerraUSD stablecoin project in May of that year sparked a daisy chain of corporate failures that culminated in the downfall of Sam Bankman-Fried’s FTX exchange.
Despite a pro-crypto White House under US President Donald Trump and surging institutional adoption, Bitcoin has plummeted over 30% since rocketing to a record in early October. The rout follows a crippling bout of liquidations on Oct. 10 that wiped out $19 billion in leveraged token bets, and in turn erased roughly $1.5 trillion from the combined market value of all cryptocurrencies. (Source: bloomberg.com)
4. Bitcoin ETF inflows — once a steady drumbeat of demand — are vanishing. For a market that treats those signals as gospel, the shift is stoking fears the crypto downdraft has further to go. Investors yanked nearly $1 billion from ETFs tracking Bitcoin during the latest session, the second-biggest daily outflow on record for the group of 12 funds, according to data compiled by Bloomberg. BlackRock Inc.’s Bitcoin fund (ticker IBIT) suffered a $355 million exodus, followed by Grayscale’s GBTC and Fidelity’s FBTC, which shed nearly $200 million each. The cohort is also on track to post its worst weekly outflow since February. (Source: bloomberg.com)
5. The Wall Street Journal:
Consumer sentiment slid in November compared with last month, the University of Michigan’s monthly survey found.
The survey’s headline index dropped to 51, hovering near one of the lowest levels in the monthly poll’s history. That final reading was up a hair from the preliminary November figure, 50.3, published two weeks ago, but down from 53.6 recorded in October. It was in line with the number that economists polled by The Wall Street Journal had forecast.
Consumers, who have faced above-trend inflation for nearly half a decade, remain frustrated with high and rising prices, survey director Joanne Hsu said. Through the first part of November, they also were contending with a record-long government shutdown, which disrupted food aid, air travel and many federal workers’ paychecks.
Economic concerns also extended to the job market, which logged a rise in unemployment to 4.4% in September despite net job creation of 119,000. Federal stats agencies are still catching up on releasing more-recent numbers as work resumes after the shutdown. (Source: wsj.com)
6. Robin Brooks:
It’s gone under the radar, but if you look at the Japanese Yen in real effective terms, which means factoring in how it stands against all currencies around the world taking into account inflation differentials, the Yen is almost as weak as Turkish Lira, which is the single worst performing currency globally after President Erdogan eviscerated his central bank.
More fiscal stimulus means more debt, which - ordinarily - would mean higher yields. But those are already artificially low and more fiscal stimulus means this distortion will only grow as BoJ is forced to ramp up buying to keep a lid on yields. So the Yen is resuming is devaluation spiral and closing in on its all-time low from mid-2024.
If Sanae Takaichi really wants to make Japan stronger, it’s time to make some hard decisions, which means raising taxes, cutting spending and selling Japan’s abundant state assets. Just doing more of the same - yet another stimulus - just doesn’t cut it. (Source: substack.com)
7. An optimistic guide to the coming year in America.
8. The latest News Items podcast features Dr. Neal Kassell, the founder and chairman of the Focused Ultrasound Foundation. We talked about….focused ultrasound. “Like a magnifying glass focusing beams of light on a single point, focused ultrasound concentrates ultrasound energy on a target in the body without harming healthy surrounding tissue.” (Sources: newsitems.substack.com, fusfoundation.org)
Quick Links: US officials are having early discussions on whether to let Nvidia Corp. sell its H200 artificial intelligence chips to China. China carmakers sell more EVs, plug-in hybrids for under $21,000. Rep. Marjorie Taylor (R-GA) announced she is resigning from Congress. “I think it’s great news for the country. It’s great,” President Trump said of her decision. Earlier in the week, Ms. Greene blasted the president for ‘vicious’ attacks amid a pipe bomb scare and death threat against her son. Death threats surge against Democrats targeted by Trump. Epstein survivors say they received death threats in new letter. Two bros from Queens: Trump, Mamdani have shockingly chummy White House Q&A. This is disturbing: Mind-altering ‘brain weapons’ no longer only science fiction, say researchers. This too is disturbing: Washington state resident dies of new H5N5 form of bird flu. Make sure to read this weekend’s edition of Bird News Items. According to three sources, who asked to remain anonymous, Bird News Items is the world’s greatest newsletter about birds.
Ed. Note: News Items will not be distributed tomorrow. We resume distribution on Monday.