Zerohedge

Axios has released a devastating report full of quotes from Trump admin officials which strongly suggests the growing rift with Zelensky is only about to worsen. 

The Ukrainian leader is seen as having overstepped by the White House. A US administration official involved in peace negotiations with Russia bluntly told the publication that “Zelensky is an actor who committed a common mistake of theater kids: He started to think he’s the character he plays on TV.“ 

“Yes, he has been brave and stood up to Russia. But he would be six feet under if it wasn’t for the millions we spent, and he needs to exit stage right with all the drama,” the unidentified official said. This strongly suggests that Trump is pursuing a full political transition in Ukraine at this point.

Another official, also involved in negotiations described that “We created a monster with Zelensky,” and that “these Trump-deranged Europeans who won’t send troops are giving him terrible advice.”

Speaking of which, one Saturday headline has revealed the European Union is still seeking ways to seize part of Russa’s frozen $280 billion in assets held abroad. So while Washington under Trump is trying to strike peace and compromise, the Europeans look content to try and sabotage what they already see as a ‘bad deal’ to end the war.

Yet another US official was quoted in Axios as reviewing that “In the course of a week, Zelensky rebuffed President Trump’s treasury secretary, his secretary of state and his vice president, all before moving on to personally insulting President Trump in the press.“

The unnamed official followed with, “What did Zelensky think was going to happen?”

Meanwhile a mineral deal is said to be close, with some Friday night headlines claiming a final deal was ‘hours’ away – but Zelensky’s office has said it’s still mulling over the first draft. “President Trump is obviously very frustrated right now with President Zelensky,” National Security Advisor Mike Waltz underscored in Thursday comments.

The same Axios report has summarized what it calls Zelensky’s five moves that set off Trump in the following…

Six administration officials tell Axios that during the past nine days there were five incidents that angered Trump, Vice President Vance, Secretary of State Marco Rubio and Waltz. Taken together, one administration official said, Zelensky “showed how not to do the ‘Art of the Deal’ ” when it came to courting Trump’s support:

• Feb. 12: Treasury Secretary Scott Bessent met Zelensky in Kyiv to offer a proposal that would give the U.S. access to Ukrainian mineral rights in return for de facto U.S. protection. Trump later told reporters Zelensky was “rude” and delayed his meeting with Bessent because he slept in.
• Feb. 14: At the Munich Security Conference, Vance and Rubio met Zelensky to get his approval for the mineral rights deal. But, the officials said, Zelensky surprised the Americans by saying he didn’t have the authority to unilaterally approve it without parliament.
• Feb. 15: Zelensky publicly rejected the offer at the conference. White House sources noted that his remarks to reporters — that the deal was “not in the interests of a sovereign Ukraine” — were markedly different from more positive-sounding comments he’d made on X the day before.
• Feb. 18: As Rubio, Waltz and presidential envoy Steve Witkoff sat down with Russian negotiators in Saudi Arabia to talk peace, Zelensky criticized the meeting for occurring without Ukraine at the table. An angry Trump then lashed out at Zelensky at a Mar-a-Lago press conference, falsely suggesting Zelensky had started the war with Russia and had an approval rating of only 4%.
• Feb. 19: Zelensky fired back, saying the U.S. president “lives in a disinformation space.” Trump then ratcheted up the pressure by posting on Truth Social that Zelensky, a former actor, was a “modestly successful comedian” who has become a “dictator without elections.” Trump has refused to criticize Putin as a dictator.

* * *

The Washington Post is also asking on Saturday: Can Zelensky salvage his relationship with Trump and save Ukraine? This after Trump accused Zelensky of being a ‘dictator’ this week, given his refusal to hold new elections, citing martial law – and after banning multiple political parties seen as too ‘pro-Russian’…

In February 2021 — more than a year before Russian troops entered Ukraine en masse — the inspiring democrat, President Zelensky, banned 3 popular opposition TV networks by accusing them of spreading Russian disinformation.

It’d be as if Biden banned Fox or Trump banned CNN:🇺🇦 pic.twitter.com/UidYz2IpFq

— Carlos Máximus (@Furiosicimo) February 22, 2025

Given this week’s anti-Zelensky rhetoric coming out of the US administration, the European allies are worried Trump will ‘give away more’ amid ongoing strong diplomatic engagement with Moscow (after already declaring that Ukraine won’t become a NATO member). Of course, Kiev is fearful of this too, which is why Zelensky’s advisors are imploring him to stop the rhetorical tit-for-tat and be silent on answering every ‘provocation’ come from the White House. Next week will be interesting to see where all of this goes.

Authored by Russell Clark via Capital Flows & Asset Markets blog,

Trump has done exactly what he said he was going to do, and negotiated with Russia directly to end the war in Ukraine. The Trump deal with Russia could be very bullish for Europe, as it could see Russian sanctions lifted, and oil and gas prices fall. This would be particularly bullish for Germany, as it has suffered from high energy prices. Although far less than in 2022, European energy prices are far higher than in the US or Russia.

Likewise, increased food supply from Ukraine and Russia could be bring down food prices – which would be bullish.

After decades of stagnation, Europe has broken out of its range, even as the Trump deal with Putin would seemingly be a negative.

It is easy to argue the opposite way. Generally speaking, when a dictator has succeeded in using force to increase their power and prestige, it is difficult for them to give up the gun, and the Baltics, like Ukraine used to be part of the Soviet Union. It is hard to find any equity weakness in this area. MSCI Baltics has ripped.

My best guess for all this bullishness would be the likelihood that the German government is going to abandon is fiscal austerity, and move to a more US style fiscal expansion – which should be good for equities and bad for bonds. That is Trump abandoning Ukraine has forced Germany to abandon austerity – and that is bullish.

The more interesting question is whether this is good for China or bad for China? On first blush, the market has decided it good. To be fair, for the Chinese tech sector we have also seen the emergence of DeepSeek and the rehabilitation of Jack Ma, and so the Hang Seng Tech index has doubled in 6 months.

On a more geo-political view, the implication is that President Trump is moving to a sphere of influence model – where Europe has to deal with Russia and its neighbours, while the US deals with its neighbours how it sees fit. The logic then is that China is free to deal with its neighbours how it sees fit too – and will not suffer consequences. In other words, China can harass and absorb Taiwan with impunity. For investors in Chinese assets this is bullish as you can now discount the risk of sanctions – which is what hurt foreign investors into Russia assets. Gazprom London listing is an example of this risk.

If Kissinger, who talked to Trump extensively during his first time, was still alive, then I would say this was unequivocally bad for China. “How so?” you might ask? Kissinger was instrumental in the ping pong diplomacy of the 1970s, that saw China and the US establish diplomatic relationships. For those you who learn history from popular culture (I learnt more about the royal family from “The Crown” that I ever learnt from any history class), Forrest Gump playing table tennis in China was basically seen as a way for the US to reach out to China. Kissinger was a prime mover in this. The driver of this détente was to isolate USSR- and from a economic point of view, betting on China versus Russia from this point of time made you a sure fire winner.

First of all there are two things to remember – China and Russia will always be important nations, by dint of the their population and land mass respectively. When they are aligned, they are very difficult to defeat, as we have seen in Ukraine, where Chinese technology has kept Russia in the game. But China and Russia are not natural allies – for most of their history they have faced off against each other. Hard to believe now, but the Soviet Union was not even that supportive of the Chinese Communist Party in its civil war for control of China, at least until the end of the Second World War. Prior to this, China/Russian relations has been defined by battle for control of the far east. If the US can bring Russia into the fold, then China become extremely exposed on oil imports, just at the US was in the 1970s.

China like the US in the 1970s is now heavily reliant on the Middle East for its oil. Bringing Russia into the fold would make energy a choke point for the Chinese economy.

Kissinger is no longer with us – so I don’t know if this is part of the plan. But Trump has always signalled that China is the true enemy of the US, not Russia. And a secure Russia would probably go along with a strategy that weakened China, if only to prove the importance of Russia to both the US and China. The thing is Kissinger had a clear aim of avoiding an open clash between the USSR and USA. Trumps aims tend to be less clear, at least to me. If it is the Kissinger line of thinking, then the current rally in Chinese tech is clear trap. But if we are moving to sphere of influence, and deal with China, then perhaps they are a buy. I find geo-politics difficult to read – but all I know is that government spending is going to go up globally – and that is bad for bonds. Japanese bonds continue to be weak.

Politics is a funny thing I have found. It is not always clear how politicians are going to behave – which I why I suspect voters loved the move to free markets in the 1980s and 1990s – it was a move away from domineering politicians. Having fallen out of love with free markets – we are moving back to domineering politicians. Markets think a deal with Russia is bad for oil prices and good for China – but I could see the reverse being true.

One of the four deceased hostages handed over by Hamas on Thursday was the wrong body, according to an Israeli government forensics investigation. As part of phase one of the ceasefire deal several rounds of hostage releases have occurred successfully.

Hamas agreed to release the body of slain hostage Shiri Bibas and her two young deceased children. “Following the identification process at the Institute of Forensic Medicine, we received this morning the news we had dreaded — our Shiri was murdered in captivity and has now returned home to her sons, husband, sister, and all her family for rest,” the family said in an initial statement.

However, outrage in Israel has ensued after it was revealed that the casket marked with Shiri’s remains was actually an unidentified deceased person.

Israeli Prime Minister Benjamin Netanyahu said Friday that Israel would make Hamas pay for failing to return Shiri’s remains.

“We will act with determination to bring Shiri home along with all our hostages — both living and dead — and ensure Hamas pays the full price for this cruel and evil violation of the agreement,” he said in a video statement.

Israel says the body is likely that of an unidentified Palestinian woman, after the two young sons, Kfir and Ariel were handed over and identified.

Netanyahu blasted Hamas for acting “in an unspeakably cynical manner” by placing the body of a Gaza woman in the coffin instead of Shiri. Her husband Yarden had also been kidnapped from a kibbutz in southern Israel on Oct.7 – but was released in the first exchange of this current truce deal.

NBC details, “Hamas leader Mahmoud Mardawi told media outlet Al Arabiya that Bibas’ remains had now been returned, and the International Red Cross said that it has received a set of human remains and transferred them to Israeli officials.”

According to a statement: 

In announcing that testing showed the first remains were not that of Shiri Bibas, the IDF said the remains also did not match any other hostage held by Hamas. “It is an anonymous body without identification,” it said.

Hamas has not commented on the charge, but did follow through with the agreed upon Saturday exchange, which saw the release of the last six living Israeli hostages in return for Israel freeing nearly 500 Palestinians from Israeli prisons.

The ceasefire will ender phase two, but it’s anything but certain whether the truce will hold, given the growing accusations. Hamas has said the Israel has killed some 100 Palestinians even while the ceasefire was on.

Authored by Matt Margolis via PJMedia.com,

Newly confirmed FBI Director Kash Patel is on fire. 

After his swearing-in, he gave a not-so-subtle speech, showing that he’s ready to handle the media’s smears.

“I know the media’s in here, and if you have a target, that target’s right here,” he said, pointing to himself. 

“It’s not the men and women at the FBI.” 

“You’ve written everything you possibly can about me that’s fake, malicious, slanderous, and defamatory,” he continued. 

“Keep it coming — bring it on. But leave the men and women, the FBI out of it. They deserve better.”

He also promised that a new day at the FBI has started. 

“I promise you the following, there will be accountability within the FBI and outside of the FBI, and we will do it through rigorous constitutional oversight — starting this weekend.”

Kash continued, “I am living the American dream, and anyone that thinks the American dream is dead, just look right here. You’re talking to a first-generation Indian kid who’s about to lead the law enforcement community, the greatest nation on God’s green earth.”

WATCH: Kash Patel’s full remarks after being sworn in as FBI Director:

“Anyone who thinks the American Dream is dead, look right here. You’re talking to a first-generation Indian kid who is about to lead the law enforcement community in the greatest nation on God’s Earth.” pic.twitter.com/PQrCkme9az

— Rapid Response 47 (@RapidResponse47) February 21, 2025

He wasted no time turning his bold rhetoric into action. Following his blistering speech on Friday, he ordered the transfer of 1,500 agents and staff from the bureau’s Washington, D.C., headquarters to field offices across the country. 

Roughly 1,000 will be sent to high-crime cities that the Trump administration designated, where they can focus on fighting crime instead of political games. Another 500 will be reassigned to Huntsville, Ala., which is widely seen as D.C.’s version of exile.

This is just Patel’s first move, and if any Democrats want to shed a bunch of tears over the move, they can, but they can’t claim they shouldn’t have expected it. As the Washington Post reported, Patel made this plan known during his confirmation hearings.

Patel, in his 2023 book, vowed to shutter the Hoover headquarters building and turn it into a “museum to the Deep State.” He’s made similar recommendations at his confirmation hearing and in appearances on conservative TV news shows.

“One of my biggest personal recommendations is … you send those 7,000 agents in the headquarters building down range to chase down rapists, to chase down murderers, to chase down drug traffickers and let the cops be cops on the streets across America,” Patel said during an August appearance on “Stinchfiled Tonight.”

During his confirmation hearing last month, Patel was asked about his previous comments suggesting he wanted the FBI’s headquarters emptied out and shuttered. His responses did not directly address whether he would actually shut the building down or seek to transform it into a museum, but suggested that he believes the FBI’s workforce in Washington should go out into the country.

“A third of the workforce for the FBI works in Washington, D.C.,” Patel said. “I am fully committed to having that workforce go out into the interior of the country, where I live west of the Mississippi, and work with sheriff’s departments and local officers.”

It’s day one and he’s already making changes. It’s glorious to see.

Pope Francis has spent more than eight days at a hospital in Rome, battling pneumonia in both lungs, and this Sunday he’s expected to miss leading the mass and prayers at St. Peter’s for the second weekend in a row.

Prior Friday statements suggested his condition ‘slightly improved’ – but by Saturday the situation has become more dire. Pope Francis “is more unwell than yesterday,” the Vatican said in a fresh statement, revealing he’s suffered a “prolonged asthma-like respiratory crisis.”

The new statement says the prognosis for him “remains guarded” – after the 88-year old Pontiff was hospitalized on Feb.14 for worsening bronchitis leading to pneumonia. He is being administered high-flow oxygen and remains in critical condition, and received a blood transfusion.

As of Thursday he was said to be awake, eating, and doing some work from his hospital bed, but pneumonia in the elderly can be devastating, and despite moments of strength, breathing problems can quickly take a downward turn. Sepsis has also reportedly remained a concern in Francis’ fragile state.

The severity of the episode has led to days speculation over possible resignation:

In a memoir, Life: My Story Through History, published last year, Francis wrote, “I think that the Petrine ministry is ‘ad vitam’ [‘for life’] and therefore I see no conditions for a resignation”, only to add in the next sentence, “things would change if a serious physical impediment were to arise”.

As the pontiff enters his eighth day in hospital on Friday, suffering from pneumonia in both lungs, Vatican watchers are wondering just how serious Francis, 88, thinks that physical impediment has to be.

On Thursday evening, the Vatican said that Francis’s condition was “slightly improving”, adding that his heart and circulation were in good shape and that he was free of fever and able to work.

However, in an interview on Italian radio, the senior Vatican cardinal Gianfranco Ravasi broached the topic on everyone’s mind and claimed: “I think he could [resign] because he is a person who, from this point of view, is quite decisive in his choices.”

This is the first time in his pontificate that the issue of resignation has been raised by a senior Cardinal. However, if he exits the hospital soon this is unlikely, as Pope’s traditionally serve till death. It is extremely rare for a Pope to step down, with his predecessor Pope Benedict XVI having been one of the exceptions to the historic rule.

Newsweek commented, “The possibility of resignation resurfaced when Cardinal Gianfranco Ravasi noted that if Francis’ ability to engage directly with people was compromised, he might consider stepping down.”

Reports of a blood transfusion needed:

BREAKING: Pope Francis has had a blood transfusion and is “suffering more than yesterday”, the Vatican has said

Sky’s @LisaatSky has the latest. https://t.co/ph1hPpMTEc

📺 Sky 501, Virgin 602, Freeview 233 and YouTube pic.twitter.com/wgca2TJfZk

— Sky News (@SkyNews) February 22, 2025

Conservative and traditional Roman Catholics have been critics of Francis’ leadership, saying he represents a liberalizing trend in church life. For example, in 2023 he issued a document allowing for priests and bishops to conduct blessing ceremonies over same-sex couples. Amid fierce controversy and confusion among conservative Catholics, he later claimed the blessing is over the ‘individuals and not the union’ – in a bit of dubious Jesuitical casuistry. 

Liberals have tended to hail him as being open to the world and a voice of ‘progress’ – while some traditionalists might be looking forward to the day a new pope is elected, but it remains that an even more liberal pope could be the successor. 

Authored by Beige Luciano-Adams via The Epoch Times (emphasis ours),

LOS ANGELES—Transportation Secretary Sean Duffy announced he would direct the Federal Rail Administration (FRA) to conduct a compliance review of funding allocated to California’s long-embattled high-speed rail—and determine whether the project is worthy of continued federal investment.

“President [Donald] Trump has thought about this project,” Duffy said Feb. 20 during a press conference with elected officials at Los Angeles’s historic Union Station. “I think he was very kind when he said this project has been mismanaged. I would agree.”

Duffy said California’s high-speed rail has so far consumed nearly $16 billion in 16 years, with almost nothing to show for it, while timelines and budgets have mushroomed, more than tripling since the project was introduced in 2008. The state rail authority reports it has spent $13 billion from July 2006 through June 2024, while recent estimates for completion run as high as $130 billion.

The rail authority’s inspector general in a Feb. 3 report anticipated further delays and a $6.5-billon funding gap in the 171-mile stretch currently under construction from Bakersfield to Merced in the state’s Central Valley region—an interior segment of the envisioned 400-mile track from Los Angeles to San Francisco.

Duffy said he would direct the FRA to focus on the $4 billion promised by the Biden administration to fund two construction projects planned for this segment.

The investigation, which will review how federal money has been spent and whether the state is in compliance with federal agreements, will help determine whether billions in taxpayer dollars should remain committed, Duffy said.

“We want to make sure the California taxpayer understands that even though they might be excited about this project, [it’s] not going to happen,” Duffy said. “There is no timeline in which you’re going to have a high-speed rail that goes from L.A. to San Francisco.”

If California wants to continue to fund the rail, Duffy said, it can do so. “But we in the Trump administration are going to take a look at whether this project is worthy of continual investment.”

Elected leaders were interrupted by a small but boisterous chorus of protesters.

“The California High-Speed Rail is a long-term project that should not be obstructed by oligarchs who only care about profits in the short term,” Jeff Zhang, 24, told The Epoch Times, suggesting delays are just “part of the cost” of the trial and error involved in building what will be the first major bullet train project in the country.

“This is nothing more than a sham investigation,” Eli Lipmann, executive director of transit advocacy organization Move LA, told The Epoch Times. “Yes, the project is behind,” but, he said, the project has created jobs and will play an integral role in future infrastructure.

Pausing funding for high-speed rail, he suggested, will also put other infrastructure projects in jeopardy.

“L.A. County has almost $1.2 billion in grants—signed, sealed, and delivered—that we need to ensure are coming, everything from better bus connections to less traffic on roads to rail projects like the Purple Line, which I took here today.”

Pointing to a recent Emmerson poll showing 55 percent of Californians still support the project, Lipmann said the federal government should be accelerating, rather than pausing, building high-quality transportation.

“What are they going to do during the investigation? They’re not going to give California money, they’re going to put a pause on it. And then they’re going to say this project is over budget,” Lipmann said.

Rep. Doug LaMalfa (R-Richvale) had a different view. The rail’s runaway costs, he suggested during the press conference, would be better spent on agriculture, water infrastructure, and other “things people need.”

LaMalfa said “dribs and drabs” of $4 billion from the feds would never add up to the $110 billion needed to make it to the finish line.

“It was a nice thought,” he said. “It’s failed.”

Rep. Kevin Kiley (R-Rocklin) said the project symbolizes the “decline of modern California” under current leadership.

Kiley told The Epoch Times his primary focus is to preclude the possibility that a future administration will pick up the mantle. “Once we cut off the federal funding, we can kill the project and focus on things that will actually improve people’s lives.”

Republican leaders are also taking aim at the state budget, including with efforts to redirect the $1 billion California spends each year on the rail project to wildfire prevention and water storage.

Former state lawmaker and current Rep. Vince Fong (R-Bakersfield) had introduced such a bill, which is now being carried by California Assemblywoman Alexandra Macedo (R-Tulare).

“There have been eight business plans, and the inspector general has outlined all the structural mismanagement,” Fong told The Epoch Times. “So we have all the data we need. It’s just, does the governor and his state legislator—the ruling party—do they have the political will to stop this project and put it into other things?”

While announcing the review, Duffy also suggested potential fraud and waste was California’s problem, and an audit should be led by Gov. Gavin Newsom.

“I can’t make decisions for the great state of California, but we do have to be responsible for the tax dollars that are spent from the federal government,” he said.

The bullet train was among a flurry of targets Trump took aim at when he assumed office last month, promising on social media that an investigation would be forthcoming.

Duffy pointed to high-speed rail projects with “great timelines” and “great budgets” currently being proposed to the Federal Rail Administration that he said have a realistic shot at completion—such as the privately funded Brightline West, which will connect Los Angeles and Las Vegas and currently and is due to finish in a few years.

“That seems like a project that is worthy of investment,” he said.

Several protesters said California has fallen behind other developed nations in public transportation and infrastructure.

“That’s a problem,” said one, of the delays and bleeding costs. “And I also think it needs to get done. We’ve invested so much already. … It’s not just for California, it’s for the whole country.”

Former Rep. Michelle Steel dismissed any parallels to countries such as Spain, France, China, and Japan, where bullet train projects have succeeded.

“I was raised in Japan. It works in Japan because you can get off from the highway public transportation and you can hop on, you can go to the city. For this one costing $128 or $140 billion, going nowhere to nowhere, we don’t need this kind of wasting taxpayers’ money.”

Marc Joffe, a visiting fellow at the California Policy Center and a longtime critic of California’s high-speed rail, in a conversation with The Epoch Times pointed to the state’s uniquely challenging business climate.

“Lots of high-speed rails in other countries were built a long time ago. China built an enormous amount recently, but they don’t have the private property protections and labor rules like we have here.

“And I don’t think anyone wants to use Chinese standards for property acquisition, or labor.”

State Sen. Shannon Grove (R-Bakersfield), meanwhile, suggested the project has benefited from plenty of preferential treatment and fast-tracking, noting its exemption from California Environmental Quality Act (CEQA) review.

“It’s proven that the Central Valley is sinking, and they’re building this monstrosity on top of the sinking valley with all that weight of concrete and rail structure,” she told The Epoch Times.

Referring to one part of the project’s Central Valley segment, Grove said:

“You can walk across this thing in 10 minutes, and they spent $13 billion on it. It’s ridiculous.”

In response to the press conference, the rail authority said on social media platform X on Thursday, “We welcome this investigation & look forward to working with federal partners.”

“CA High-Speed Rail has been audited over 100 [times], every dollar is accounted for & progress is real—50 structures built, 14,600 jobs created & 171 miles under construction.”

One of the longest running traditions in modern finance is that every year, one Saturday morning in late February, the world’s financial class – from refined professionals to rancid amateurs – sit down as they have for the past 66 or so years – for an hour and read the latest Berkshire annual letter written by Warren Buffett in which the man seen by many as the world’s greatest investor writes down his reflections, observations, aphorisms and other thoughts for the past year, which are closely parsed and analyzed for insight into what he may do next, what he thinks of the current economy and market climate, or simply for insights into how to become a better investor. And with Buffett’s long-time investing partner, Charlie Munger, having one year ago passed away just shy of his 100th birthday and Buffett himself now 94, every such letter may well be the last, which is why – even though their informational content and signal-to-noise ratio has been severely diluted over the year – they are read just as obsessively as they were when Buffett was in his prime.

Which brings us to the latest Berkshire annual report and accompanying letter, which – at 13 pages clocks in three pages less than last year’s edition and one of the shortest ever – was somewhat of a downer as the Omaha billionaire said that even though Berkshire did “better than I expected”, a majority, or 53% of Berkshire’s 189 operating businesses, reported a decline in earnings. The offset? The company’s staggering cash pile (more on that in a second) which is invested in T-Bills and which generates about a 4.5% in interest income: “We were aided by a predictable large gain in investment income as Treasury Bill yields improved and we substantially increased our holdings of these highly-liquid short-term securities.”

Buffett also said that Berkshire’s insurance business also delivered a major increase in earnings, led by the performance of GEICO, whose “2024 improvement was spectacular”, while property-casualty insurance pricing strengthened during 2024, “reflecting a major increase in damage from convective storms.” GEICO was also the main contributor to Berkshire’s insurance results, with its pretax underwriting earnings more than doubling to $7.8 billion in 2024. The auto insurer successfully added new clients in the second half, reversing a years-long trend that previously weighed on its performance.

Buffett also exposed his liberal roots (readers may forget that the folksy Omaha billionaire was one of the loudest and most virtue-signaling Hillary Clinton donors) saying that “climate change may have been announcing its arrival”, yet even Buffett admits that “no ‘monster’ event occurred during 2024.” That said, “someday, any day, a truly staggering insurance loss will occur – and there is no guarantee that there will be only one per annum.” Additionally, Berkshire’s railroad and utility operations, the conglomerate’s largest businesses outside of insurance, also improved their aggregate earnings. 

All told, Berkshire recorded operating earnings of $14.5 billion in Q4, up 71% from $8.5 billion a year ago, as higher interest rates lifted the conglomerate’s investment income and, while Berkshire’s insurance business scored a 48% jump in insurance investment income, to $4.1 billion, amid higher interest rates. Earnings also got a significant boost from a strong recovery in the firm’s insurance underwriting business, with operating earnings quadrupling over the period to $3.4 billion.

All told, in 2024 Berkshire earned $47.4 billion in operating earnings, the third straight record operating profit (Buffett will never tire of emphasizing this measure “rather than GAAP-mandated earnings”.) Here’s a breakdown of the 2023-24 earnings as Berkshire reported them. 

That said, Berkshire said it expects pretax losses of approximately $1.3 billion from the wildfires that ravaged entire parts of Los Angeles last month. Net income for the full year totaled $89 billion, including gains from Berkshire’s common stock investments such as Apple and American Express; for Q4, Berkshire reported that net income more than doubled to $37.574 billion, or $26,043 per Class A share, from $18.8 billion, or $12,355 per share, a year earlier.

Meanwhile, the otherwise acquisitive Berkshire refused to pursue any M&A for yet another quarter, and Buffett’s cash hoard grew for the 10th quarter in a row, to a record $334.2 billion at the end of 2024, as the billionaire continued to refrain from major stock transactions in the fourth quarter.

Still, Buffett said his company will continue to prefer owning equities, primarily U.S. stocks, over cash, adding Berkshire is “not finished.”

Going back to Q4, the firm was a net seller of $6.7 billion worth of shares; this marked the 9th consecutive quarter in which Berkshire has been selling stock (Berkshire has not made a major purchase of an entire company since 2016), the longest stretch by far in the company’s history…

… and even though Berkshire did not sell any Apple this quarter (having previously slashed his holdings in the smartphone giant by more than half), in Q4 Berkshire did continue to aggressively sell down its financial holdings such as BofA, Citi and Capital One, as discussed in our breakdown of the company’s 13F last week.

“Often, nothing looks compelling; very infrequently we find ourselves knee-deep in opportunities,” Buffett wrote.

And, for the second straight quarter, Buffett also did not find Berkshire stock itself to be attractive, buying back zero shares in Q4, the same amount as in Q3. Berkshire’s market capitalization has been hovering above $1 trillion since late last month, and according to Buffett it is perfectly fairly valued here. 

The company’s stock price has risen 15% in the last year, while the S&P 500 rose 18%. Over the last decade, Berkshire’s stock price has risen 225%, while the index rose 241% including dividends and 185% excluding dividends, Reuters data show.

“They will have lots of buying opportunities but Berkshire will never be the large double-digit compounder it had been,” said Bill Smead, chief investment office at Smead Capital Management in Phoenix. “Berkshire will be a solid way of participating in owning major companies, and avoiding trouble.”

The lack of any attractive mergers is a problem that Buffett has been staring down for almost a decade as the growth of Berkshire’s operations and cash levels have compounded. In his annual letter to shareholders, Buffett addressed concerns that Berkshire is hoarding cash and reminded investors that the great majority of the firm’s money remains invested in equities, both public and private, and that this won’t change.

“Berkshire will never prefer ownership of cash-equivalent assets over the ownership of good businesses, whether controlled or only partially owned,” Buffett said in the letter.

Buffett also said the value of the Berkshire’s private equity holdings increased and remained “far greater than the value of the marketable portfolio” last year. Over the same period, Berkshire’s ownership of public equities declined 23%, to $272 billion. 

The billionaire said Berkshire could increase “over time” its long-time holdings in Itochu, Marubeni, Mitsui, Mitsubishi and Sumitomo, Japan’s five largest trading houses. While Berkshire initially intended to keep its stake below the 10% threshold, the five companies have agreed to “moderately relax the ceiling” as the conglomerate approaches it.

The 94-year-old Buffett also acknowledged his advanced age in the letter, telling shareholders he now uses a cane and will spend less time fielding their questions at Berkshire’s annual meeting in May. He nonetheless assured shareholders they would be in good hands after he turns over the conglomerate’s reins to Vice Chairman Greg Abel, saying the 62-year-old Abel has “vividly shown his ability” to deploy capital.

Among other topics discussed in his letter, Buffett he sent a cautionary message to Washington, lamenting how capitalism “has its faults and abuses–in certain respects more egregious now than ever,” with malfeasance by “scoundrels and promoters” in full force.

“But even with such malfeasance – which remains in full force today – and also much deployment of capital that eventually  floundered because of brutal competition or disruptive innovation” Buffett said that “the savings of Americans has delivered a quantity and quality of output beyond the dreams of any colonist.”

The billionaire also urged lawmakers to help preserve a stable U.S. dollar, saying “paper money can see its value evaporate if fiscal folly prevails,” and that the United States has in its history “come close to the edge.  Fixed-coupon bonds provide no protection against runaway currency.”

The warning comes at a time of ever louder rumblings about a Mar-A-Lago accord, in which the Trump admin will stealthily devalue the dollar against all other currencies in a bid to kickstart US manufacturing, but will only succeed in sending gold and crypto to new all time highs. 

Buffett said long-term success of Berkshire and the American economy, which he called the “American miracle,” has depended on people’s ability to participate. That, he said, is something Uncle Sam can encourage, or take away.

“Take care of the many who, for no fault of their own, get the short straws in life,” Buffett wrote, addressing the government. “They deserve better. And never forget that we need you to maintain a stable currency and that result requires both wisdom and vigilance on your part.”

To be sure, this was more than just some folksy aphorism. According to Cathy Seifert, a CFRA analyst who rates Berkshire “hold”, “talking about the business of America being messy was his way of addressing the political landscape and its impact on the macroeconomic environment. He is warning Washington: Be careful where you tread.”

At the annual meeting, which tens of thousands of people attend, Buffett will spend less time on the stage where he, Abel and Berkshire Vice Chairman Ajit Jain answer shareholder questions. Buffett told Fortune magazine last month that he was still having fun and able to do a few things reasonably well, while other activities had been “eliminated or greatly minimized.”

The meeting will also not feature the traditional movie created by Buffett’s daughter Susie.

In discussing his age, Buffett said he talks regularly on Sundays with his 91-year-old sister Bertie, using an old-fashioned phone.

“We cover the joys of old age and discuss such exciting topics as the relative merits of our canes,” he said. “In my case, the utility is limited to the avoidance of falling flat on my face.”

Beside the company’s record cash hoard, there was another notable record revealed in this year’s letter: Buffett said the company has paid the US government more than $101 billion in taxes since he took the helm 60 years ago, more than any other company in history.

Buffett’s comments come as President Donald Trump has vowed to cut corporate taxes further after slashing them to 21% during his first term in 2017. Trump wants to reduce the corporate tax rate to 15%.

Berkshire paid $26.8 billion in taxes in 2024 alone. Buffett said that “record-shattering” figure amounts to roughly 5% of the total taxes paid by US companies last year, and excludes state taxes and taxes paid to foreign governments. 

“If Berkshire had sent the Treasury a $1 million check every 20 minutes throughout all of 2024 – visualize 366 days and nights because 2024 was a leap year – we still would have owed the federal government a significant sum at yearend,” Buffett wrote, and what is remarkable, is that he is actually proud of enabling the unprecedented grift, corruption and inefficiency that DOGE – and so many others – have unearthed over the years. 

Berkshire’s 2024 tax bill exceeded that of the previous five years combined, owing in part to his significant sales last year of two of its biggest holdings, Apple and Bank of America, according to Edward Jones analyst Jim Shanahan. In the letter, Buffett said that when he took control of Berkshire Hathaway company in 1965, it was a struggling textile operation that paid zero in income taxes that year, and hadn’t for much of the previous decade.

“That sort of economic behavior may be understandable for glamorous startups, but it’s a blinking yellow light when it happens at a venerable pillar of American industry,” Buffett wrote. “Berkshire was headed for the ash can.”

Finally, for all those who are bored to death by the above, here is an AI chatbot summary of all you need to know:

• Summary of Berkshire Hathaway’s 2024 Annual ReportChairman’s Letter Highlights
  • Performance & Strategy: Berkshire Hathaway delivered stronger-than-expected results in 2024, despite 53% of its 189 operating businesses reporting earnings declines.
  • Insurance Business: The insurance segment, led by GEICO and property-casualty underwriting, saw a significant earnings boost. The company anticipates increased insurance risk due to climate-related disasters.
  • Investment Income: Rising Treasury yields contributed to a major gain in investment income.
  • Major Acquisitions: Increased ownership of Berkshire Hathaway Energy from 92% to 100% for $3.9 billion.
  • Mistakes & Learning: Warren Buffett candidly discusses past investment misjudgments and the importance of correcting errors swiftly.
  • Succession Planning: Greg Abel is set to take over as CEO, emphasizing a commitment to transparency and shareholder value.
  • Berkshire’s Tax Impact: The company paid a record-breaking $26.8 billion in U.S. corporate taxes in 2024.
• Financial Performance
  • Operating Earnings: Increased to $47.4 billion in 2024 from $37.35 billion in 2023.
  • Investment Portfolio: Berkshire’s partial ownership in leading companies like Apple, American Express, and Coca-Cola was valued at $272 billion.
  • Cash Reserves: While holding a significant cash position, Buffett reinforced the company’s long-term commitment to equities, primarily in the U.S.
• Japanese Investments
  • Expanded stakes in five Japanese trading companies: ITOCHU, Marubeni, Mitsubishi, Mitsui, and Sumitomo.
  • Current investment worth $23.5 billion, up from a $13.8 billion cost basis.
  • Plans to continue long-term investment strategy in Japan.
• Property-Casualty Insurance & Risk
  • Berkshire’s P/C insurance sector remains its core business, benefitting from strong underwriting and investment income.
  • The company takes on large-scale risks that competitors often avoid but remains disciplined in pricing.
• Future Outlook
  • Buffett maintains optimism about capitalism and America’s long-term growth potential.
  • The company will continue prioritizing equity investments and disciplined capital allocation.
  • Plans to deploy capital in large, high-return opportunities as they arise.
• Shareholder Events
  • The 2025 annual shareholder meeting will take place on May 3 in Omaha, featuring a Q&A session with Buffett and Greg Abel.
  • This report reflects Buffett’s characteristic mix of financial insight, candid reflections, and long-term optimism for Berkshire Hathaway’s future.

More in the full Berkshire shareholder letter available here.

The U.S. Department of Justice (DOJ) filed a motion Thursday indicating it wants to drop a lawsuit accusing SpaceX of hiring discrimination against refugees.

The lawsuit filed by the DOJ in August 2023 alleged that SpaceX, owned by Elon Musk, violated the Immigration and Nationality Act by refusing to hire people with asylum or refugee status.

The aerospace company countersued the DOJ later that year on constitutional grounds. 

Last month, a federal judge in Texas granted the DOJ’s request to stay the lawsuit for 45 days, saying that the department lacks the authority to pursue its claims against SpaceX.

Aldgra Fredly reports for The Epoch Times that, in a court filing on Thursday, the DOJ requested that the court lift the stay on the lawsuit so it could proceed with filing a notice of dismissal. It did not provide a reason for the possible dismissal.

Both the DOJ and SpaceX did not respond to a request for comment by publication time.

In its 2023 lawsuit, the DOJ alleged that between 2018 and 2022, SpaceX discouraged asylees and refugees from applying for jobs and failed to fairly consider their applications due to their citizenship status. The DOJ accused SpaceX of falsely asserting in job postings and public statements that export control laws hindered the company from hiring people without U.S. citizenship.

“Under these laws, companies like SpaceX can hire asylees and refugees for the same positions they would hire U.S. citizens and lawful permanent residents,” it stated. 

“And once hired, asylees and refugees can access export-controlled information and materials without additional government approval, just like U.S. citizens and lawful permanent residents.”

The DOJ also stated that the Immigration and Nationality Act barred companies from discriminating against refugees and people granted asylum unless legally mandated to do so.

SpaceX, in its countersuit, denied any wrongdoing, saying that the company has always strived to “hire the very best candidates for every job regardless of their citizenship status.”

The company argued that due to the sensitive nature of its work—such as manufacturing technologies with military applications—it is subject to legal mandates under export control laws, including the International Traffic in Arms Regulations (ITAR), which limit whom it can employ.

“These export control laws and regulations are critical to our national security. Moreover, violating them can have severe consequences for a company like SpaceX,” it stated, noting that failing to comply with the regulations could result in hefty fines and criminal penalties.

On Aug. 25, 2023, Musk stated on the social media platform X that his company had been told that hiring anyone who is not a permanent U.S. resident would violate ITAR.

“We couldn’t even hire Canadian citizens, despite Canada being part of NORAD! This is yet another case of weaponization of the DOJ for political purposes,” he stated.

Musk was appointed by President Donald Trump earlier this year to lead the Department of Government Efficiency (DOGE), which has been tasked with reviewing federal agencies for potential downsizing and cost reductions.

Trump had previously said that Musk would not be able to take any action without approval from the White House, and the government “won’t let him go near it” if there is a conflict of interest.

DOGE’s work is expected to be completed by July 4, 2026, according to Trump’s Jan. 20 executive order.

Authored by Jonathan Turley,

For weeks, politicians and pundits have engaged in a ghoulish effort to blame every plane accident on the Trump Administration, even accidents that occurred within the first weeks of the Trump Administration. 

Hillary Clinton led the effort by bizarrely suggesting that the collision of the airliner and the helicopter over the Potomac was due to the changes in Trump’s policies. 

The spin showed utter contempt for the intelligence of the public since there was no evidence that the Trump Administration policies had any impact on the accidents.

Nevertheless, the press and pundits fueled the false narrative by citing various accidents in January. That narrative then collapsed after CNN and other media outlets acknowledged that there were actually fewer accidents in January than average and that the Biden Administration saw more accidents during the same period.

The attempt to use these tragedies for raw political advantage is appalling. However, it also shows the complete disregard for the intelligence of voters in suggesting the nexus between the change of Administration and airplane accidents shortly after the inauguration.

It does not matter that Transportation Secretary Sean Duffy was not confirmed until January 28, 2025, less than 24 hours before the accident over the Potomac.

Nevertheless, Senate Minority Leader Chuck Schumer and others immediately weaponized that and later tragedies.

Schumer was joined by media figures like former MSNBC host Mehdi Hasan, who later was compelled to delete a tweet on Sunday, Feb. 16 in which he wrote “Make American Plane Crash Again.” 

Like others, Hasan was connecting a small plane crash in Georgia to the start of the Trump Administration.

Then there was Rep. Eric Swalwell. We have previously discussed the bottomless pit of Swalwellian logic, such as shutting down the government to prevent government shutdowns.

The logic tree was felled again by Swalwell in blaming the Trump Administration for the crash in Georgia: “Trump is President. President Trump is in charge of air safety. All crashes are Trump’s fault.”

The only problem, as pointed out by CNN, is that air travel overall was better in January than prior such periods:

“In fact, if the preliminary numbers hold, January 2025 will surpass the previous record for the lowest number of total accidents, with eight fewer than the prior record low of 70 from January 2012.”

Does that mean that all aircraft safety like aircraft accidents are attributed to Trump? Of course not. Not only have no changes been made that have impacted the air traffic controllers in these cases, but none of the proposals would reduce those controllers.

The most bizarre was the effort to blame Trump for an accident where a plane flipped over in Canada.

On NBC, Tom Costello observed “as you know there has been talk about maybe staff cuts at the FAA as a part of President Trump’s effort to trim down the federal workforce.”

This is becoming a policy version of Six Degrees from Kevin Bacon. Every airport accident can be traced within six degrees of DOGE or Duffy.

It is very easy. Just take any airline mishap anywhere in the world and then trace it back to the United States and Sean Duffy. For example, there was also a water main break at the airport at Fort McMurray International Airport in Alberta. Ready? Go…

If you are struggling, just watch Schumer who is the most nimble at this game.

“I’m thankful that everyone in the flight incident in Toronto that took off from Minneapolis is safe, but we keep seeing these incidents day after day. Meanwhile, Trump’s doing massive layoffs at the FAA – including safety specialists – and making our skies less and less safe…Democrats are fighting to protect the flying public…To those asking whether it matters that the plane’s destination was in Canada: The flight took off from Minneapolis. The FAA was still responsible for inspecting the aviation equipment, and Trump just let go of FAA safety specialists.”

Done. Six degrees to Duffy.

In the wake of President Trump’s designation of several Latin American drug cartels as foreign terrorist organizations, Mexican President Claudia Sheinbaum on Thursday warned the White House against military action inside her country. 

“This cannot be an opportunity for the U.S. to invade our sovereignty,” she told reporters. “With Mexico, it is collaboration and coordination, never subordination or interventionism, and even less invasion.”

Her remarks followed Wednesday’s US State Department announcement that it had designated eight Latin American drug cartels as foreign terrorist organizations. In addition to the notorious Venezuelan gang Tren de Aragua that has been raising hell inside the United States, the list included Mexico’s two principal drug traffickers: the Jalisco Nueva Generacion and Sinaloa cartels. 

The move fulfilled a promise Trump made during his 2024 election campaign. While the most likely initial actions will center on the legal and financial fronts, the terrorist designation opens the door for military action against the cartels. In the wake of the announcement, Trump advisor Elon Musk tweeted, “That means they’re eligible for drone strikes.”

Sheinbaum, however, warned against unilateral US military action:

“The Mexican people will under no circumstances accept interventions, intrusions or any other action from abroad that is detrimental to the integrity, independence or sovereignty of the nation… [including] violations of Mexican territory, whether by land, sea or air.”

Earlier, Sheinbaum said she had approved US surveillance drone flights over Mexico. That claim came after CNN reported that the administration tapped the CIA to use unarmed MQ-9 drones to monitor the cartels. The secret missions were communicated to members of Congress, with the description of the undertaking making no mention of a partnership with the Mexican government.

There have also been indications of US Air Force RC-135V aircraft performing signal intelligence (SIGINT) missions inside Mexican airspace. Meanwhile, the Mexican Senate Commission has given the green light for US Special Forces deployment inside Mexico for “training missions.” 

Sheinbaum has said she opposes a terrorist designation out of concern that US government actions under such a designation may violate Mexican sovereignty, arguing that the two countries should work in mutual consultation and collaboration. Last week, Sheinbaum threatened to retaliate for a terrorist-designation by expanding Mexico’s lawsuit against several American gun manufacturers, including Smith & Wesson, Barrett, Colt and Sturm, Ruger & Co: 

“If they were to decree organized crime groups as terrorists, we would have to expand the lawsuit in the United States because — as the Department of Justice itself has already acknowledged that 74% of the arms of criminal groups come from the United States — then how are the arms manufacturers and distributors affected by the decree? The lawyers are looking at it, but they could be accomplices.”

The move toward the US terror designation began with a Day One executive order from Trump tasking the State Department with evaluating that avenue. “The cartels have engaged in a campaign of violence and terror throughout the Western Hemisphere that has not only destabilized countries with significant importance for our national interests but also flooded the United States with deadly drugs, violent criminals, and vicious gangs,” Trump wrote.