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Podcast king Joe Rogan said the mysterious drones that have buzzed around the tristate area have left him “genuinely concerned” Sunday after watching a video that floated an unverified theory about the unmanned devices sniffing out harmful substances.

John Ferguson, the CEO of a remote aircraft system company in Kansas, claimed in a drawn-out TikTok video on Saturday the drones are attempting to “smell” either a gas leak, “radioactive material,” or something else on the ground.

“The only reason why you would ever fly an unmanned aircraft at night is if you’re looking for something,” Ferguson said in the clip, noting he doesn’t believe the drones are nefarious.

“So my belief is they’re trying to smell something on the ground – gas leaks, radioactive material, whatever,” the CEO said.

Ferguson added that the theory was his best guess based on his expertise and just his opinion on the drone mystery that’s gripped the East Coast and admitted “I’ve not bounced this off anybody.”

“So if you think it’s bulls–t, whatever, that’s cool. I don’t want to spread misinformation, as we know that there’s a lot of that going around,” he said in the TikTok video.

But his theory resonated with many online including Rogan, who offered his two cents on the drones that have unnerved New Jersey and New York residents for weeks.

“This is the first video about these drones that has got me genuinely concerned,” he wrote on X on Sunday.

The popular podcast host previously called the claims from the US government “sus” after White House National Security Council spokesman John Kirby said the drones were not a public safety concern, and many of the reported sightings are actually manned aircraft.

Department of Homeland Security Secretary Alejandro Mayorkas also downplayed concerns about the drones on Sunday, claiming part of the drone sightings are based on relaxed regulations that allow the devices to fly at night.

“Some of those drone sightings are, in fact, drones,” he said. “Some are manned aircraft that are commonly mistaken for drones. And we do see duplicative reporting.”

Mayorkas also stressed that the department has deployed personnel and technology “and if there is any reason for concern, if we identify any foreign involvement or criminal activity, we will communicate with the American people accordingly” during an interview with ABC News on Sunday.

“Right now, we are not aware of any. If we become aware of any, we will communicate accordingly and take appropriate action,” he added.

The Post has sought comment from DHS over the latest theory.

A wide range of pols – both Republicans and Democrats — have been making noise about the seemingly endless drone sightings in the tri-state area. New York Sen. Chuck Schumer called on the feds to deploy radar technology to identify the swarms of drones.

Schumer, along with New York Sen. Kirsten Gillibrand, New Jersey Sen. Cory Booker and New Jersey Sen. Andy Kim sent a letter to the FBI, Homeland Security, and the Federal Aviation Administration last week demanding an explanation about what they are doing to “identify and address the source of these incursions.”

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Tesla fights to avoid the steep cost of scrapping Elon Musk’s pay package

Over $100bn in accounting and tax charges may await electric-car maker and CEO if they are forced to abandon 2018 deal

Tesla has vowed to press on with its fight to restore Elon Musk’s historic pay package, and failure could have a high cost: the potential for more than $100bn in tax and accounting charges for the company and its chief executive.

Delaware judge Kathaleen McCormick recently denied the electric vehicle maker’s second attempt to give Musk the largest package of stock options in history — worth $56bn at the time of the original ruling and more than $129bn at the current share price. She found that shareholders’ overwhelming vote to reapprove the grant did not override her previous rejection of the 2018 deal as unfair and awarded by a board in thrall to its CEO.

Her stance has left the board with a dilemma: pursue a lengthy and uncertain appeal with Delaware’s Supreme Court or award its chief executive with a new options package.

If issued with similar terms, a new package could trigger a $50bn-plus corporate accounting charge and separately impose a punitive tax rate of up to 57 per cent on Musk’s shares, triggering a massive tax bill.

In April, Tesla warned shareholders that reissuing a new set of stock options entitling Musk to buy the same 304mn shares would result in a compensation-related accounting charge of more than $25bn, since the company’s valuation was substantially higher than in 2018. That compares with a $2.3bn charge for the original 2018 award.

Those calculations were based on a share price of $175 on April 1, when Tesla’s market capitalisation was $558bn. The stock has since more than doubled to $425 giving Tesla a valuation of $1.3tn — much of that due to investor enthusiasm for Musk’s newfound relationship with president-elect Donald Trump — implying the accounting charge could multiply by a similar amount.

Less known are the potential tax implications for Musk, whose net worth recently soared past $400bn — the first person to reach that level of wealth.

If Tesla prevails in its appeal, which must be filed within 30 days of the December 2 ruling, Musk would pay the standard federal rate of 37 per cent tax for stock compensation when he exercises his 2018 options, which he is under no obligation to do until 2028.

If the Delaware Supreme Court declines to overturn the original ruling and the board opts to issue a new plan on similar terms, the options would be awarded already “in the money”, since the financial targets have already been achieved. 

“It is very simple. If you grant options that are ‘in the money’, which they clearly are now, all kinds of bad things happen,” Schuyler Moore, a tax partner at Los Angeles law firm Greenberg Glusker, told the Financial Times. “That is why they are trying so hard to ratify the original deal. If they re-award it now, there will be hell to pay on taxes.”

When devised in 2018, the stock options were contingent on ambitious targets — such as increasing revenue 15 times and valuation 12-fold — which Musk had achieved by 2023.

At the time the package was awarded, the options were “out of the money” and not exercisable, thereby qualifying for exceptions in a part of the tax code known as 409A, which governs deferred compensation.

The rule was introduced in 2005 after Enron executives rushed to cash out vested stock they had received as part of their compensation plans before the company went bankrupt.

McCormick’s decision to rescind Musk’s plan in January cancelled his options, which from a tax perspective no longer exist.

Moore said attempting to award a new deal with the same terms now could breach section 409A, which “triggers the immediate taxation of the full value of deferred compensation on the date it is vested, well before the deferred compensation would be taxable under normal rules”.

“To add insult to injury, section 409A would impose an additional 20 per cent tax on the value,” Moore wrote in an article in the influential journal Tax Notes Federal. “The damage is done on the date of grant.”

That means Musk would be immediately liable for 57 per cent income tax on the difference between the strike price and the current value of the stock, whether he chooses to exercise the options or not. At Wednesday’s closing price of $425 and a strike price of $23.34 set in 2018, the difference would be $122bn, which means an almost $70bn tax bill.

“The tax issue here is straightforward. If you give him the same non-409A-compliant package now, you face acceleration of the income tax at the point of receipt rather than when he exercises, with the penalty rate on top,” said Bradford Cohen, a tax partner at Jeffer Mangels Butler & Mitchell. “It could be a very expensive, unfortunate mistake.”

Even for Musk, the world’s richest man, that would be eye-watering. In early 2022, the billionaire posted on X that he “paid the most taxes ever in history for an individual last year” in reply to a message saying he owed the US Internal Revenue Service $11bn in 2021.

“The only sure way that Musk could avoid these issues is to . . . successfully appeal [the decision], since it should then be viewed as a nullity,” said Moore. “A lot will be riding on those attempts.”

Despite Musk opting not to exercise his package when entitled to last year, “having the options is powerful and valuable”, said Moore, because they act as a deterrent to potential acquirers or activists. Musk can also borrow against their implied value, as long as he does not grant a lien on the options.

The board has another route to help Musk avoid the extra 20 per cent in tax, but it is still costly. Directors could award him 304mn Tesla shares worth $129bn at the current price, which would be subject to the standard rate of 37 per cent, about $48bn.

When quizzed on the issue by McCormick during a hearing in August, a lawyer for Tesla also raised the prospect that a likely higher personal tax rate could result in Musk receiving an even larger package to offset the cost of his taxes.

“Ultimately, as we know how economics work, then you’d have to likely pay him more. If he has a number he wants and he’s getting taxed, those get passed on [to shareholders],” said Rudolf Koch of Richards, Layton & Finger.

Moreover, if Musk were to flood the market by selling that much stock at once to cover the tax, it would risk causing the share price to fall.

The company would still have to shoulder the accounting charge. And if pay negotiations start over, Musk may not agree to a five-year lock-up period after exercising during which he cannot sell, a feature of his 2018 package.

Musk has previously raised the prospect of withdrawing from the electric-car maker, and the board had argued that the compensation plan was a key way of retaining the mercurial billionaire’s commitment.

In January, he posted on X that he was “uncomfortable growing Tesla to be a leader in AI and robotics without having ~25% voting control” and “unless that is the case, I would prefer to build products outside of Tesla”.

Tesla did not immediately respond to a request for comment.

How ‘the mother of all bubbles’ will pop

It’s time to bet against American exceptionalism

Having tagged America’s inordinately large share of global financial markets as “the mother of all bubbles” in my last column, the main pushback I got, even from the few people who share my view, was that there is no sign this bubble will deflate any time soon.

Almost no one foresees an imminent pop. Virtually every Wall Street analyst predicts US stocks will continue outperforming the rest of the world in 2025. But all this enthusiasm only tends to confirm that the bubble is at a very advanced stage. If the consensus on “American exceptionalism” is so overwhelming, who is left to hop on the bandwagon and inflate it further?

The certainty of Wall Street has spilt over into the popular media, which often picks up on market trends only when they are well established and near an end. Hype for American superiority is now the stuff of TV, radio, podcasts, newspaper columns and magazine cover stories, which have a record of pointing the wrong way on future trends.

The bulls say America can remain dominant, owing to impressive earnings of the country’s corporations. But US earnings growth would not look so exceptional if not for the supernormal profits of its big tech firms, and massive government spending. Over time, supernormal profits get competed away. Growth and profits are also getting an artificial lift from the heaviest deficit spending ever recorded at this stage of an economic cycle, by far.

Most economists nonetheless argue that, with the balance sheets of US households and companies in good shape, the economic boom will endure. The few who worry about President-elect Donald Trump’s tariff or immigration plans tend to think they will hurt foreign economies more than the US.

But every hero has a fatal flaw. America’s is its sharply increasing addiction to government debt. My calculations suggest it now takes nearly $2 of new government debt to generate an additional $1 of US GDP growth — a 50 per cent increase on just five years ago. If any other country were spending this way, investors would be fleeing, but for now, they think America can get away with anything, as the world’s leading economy and issuer of the reserve currency.  

More likely, by some point next year, investors will balk and demand higher interest rates or a demonstration of fiscal discipline, triggered perhaps by an even larger deficit or ever bigger auctions of Treasuries. Those demands will wean the US off its dependence on government spending, at least temporarily, and in turn undermine economic growth and corporate profits.

To be clear, this is a bubble in America’s performance relative to the rest of the world, not a 1990s-style mania in the US market. So, it can deflate in a benign way if the alternatives begin to look more attractive.

Maybe Germany and France will get their economic act together, as Greece and Spain did a decade ago when under duress. Maybe Beijing, under pressure from Trump tariffs and weak domestic demand, will finally boost consumption to stabilise the economy. 

But, mesmerised by “American exceptionalism”, analysts can talk only of how the US has been the world’s premier market for a century. They forget that in six of the last 11 decades, the country’s stock market lagged behind the rest of the world, most recently in the 2000s when it delivered zero returns and emerging markets tripled in value. As that decade came to a close, the attitude in emerging markets echoed the certainty I hear about the US now: “Where else will the money go?”

The incredible outperformance relative to other countries could end if growth slows in the US, or picks up in other major powers, or for unforeseen reasons. That is often how bubbles end: unexpectedly. The two most recent manias in global markets were the commodities boom, which started bursting in 2011 on a surge of new supply, and the China growth bubble, which collapsed in 2021 amid a state crackdown on the property sector.

The longer a trend lasts, the more confident investors get, and the more indiscriminately they buy into the mania. In the late stages of a bubble, prices typically go parabolic, and over the past six months US stock prices have outgained others by the widest margin for any comparable period in at least a quarter century. When flying in such thin air, it doesn’t take much to stall the engines. All the classic signs of extreme prices, valuations and sentiment suggest the end is near. It’s time to bet against “American exceptionalism”.

Consumption rises less than forecast in November, highlighting why leadership made it the top economic concern

Retail sales in China missed expectations in November, adding to pressure on policymakers after President Xi Jinping signalled last week that he wants to spur household consumption to boost the world’s second-largest economy.

The consumption measure added 3 per cent year-on-year, below a forecast of 4.6 per cent in a Reuters poll, and last month’s rise of 4.8 per cent. Industrial production added 5.4 per cent, slightly above predictions.

The unexpectedly weaker growth comes days after the Communist party leadership called for “vigorous” efforts to boost consumption and domestic demand at the annual Central Economic Work Conference last week.

The November retail number “was the big disappointment of the month, as retail sales . . . came in well softer than both consensus and our forecasts”, said Lynn Song, chief economist for greater China at ING in a research note.

Beijing has struggled to boost confidence against the backdrop of a property slowdown, now entering its fourth year, and bouts of deflation. The government unveiled a series of measures to boost stock markets in late September and to refinance local government debt last month.

Chinese equities fell on Monday. The CSI 300 index of blue-chip mainland-listed companies was down 0.6 per cent by mid-morning, while Hong Kong’s Hang Seng index fell 0.4 per cent.

China’s 10-year sovereign bond yield fell 0.05 percentage points to 1.73 per cent and its 30-year yield fell below 2 per cent for the first time.

The conference’s work report last week listed consumption as the first of nine economic priorities for 2025, ahead of the “new productive forces” that have emerged as a core pillar of Xi’s approach.

The emphasis is one of several signs of growing urgency from the government, including a shift in its monetary policy stance to “moderately loose” from “prudent” for the first time in over a decade last week.

Consumer prices in November rose just 0.2 per cent, a five-month low. Prices have increased every month since January, but growth has remained close to deflationary territory, adding to concerns over the strength of domestic demand.

Consumer spending was an economic concern in China during the Covid-19 pandemic, when the government imposed strict lockdowns to prevent the spread of the virus, and has failed to bounce back fully since a reopening almost two years ago.

ING’s Song said that aside from the National Bureau of Statistics’ property price index for 70 cities, which showed marginal falls during the month and indicated a stabilisation, the overall data was softer than expected in November.

Property investment was still declining, falling 10.4 per cent in the 11 months to the end of November, the NBS said, compared with a fall of 10.3 per cent in the first 10 months.

Goldman Sachs economists attributed the soft retail sales to an earlier than usual start to the annual November “Singles Day” online shopping festival, which pulled forward some sales to October.

But Goldman and other economists said that overall, indicators suggested that annual growth this year would end close to the government’s official target of 5 per cent.

Xi last week pledged to meet the target, saying that China would continue “to play its role as the world’s largest economic growth engine”.

Citi analysts said the government would probably release few details of any proposed fiscal stimulus measures until early next year during the annual meeting of China’s rubber stamp parliament, the National People’s Congress. This normally sets out the economic agenda for the following 12 months.

“The politburo and CEWC concluded with a supportive tone but no major breakthroughs or concrete measures,” Citi said. “The next two months could be a policy vacuum until the NPC.”

Knife attacks and car rammings have officials unnerved about widespread societal discontent

Faced with rising social frustrations and public unrest, China’s leaders are ramping up security measures and squelching discordant views on the country’s economic health.

A spate of deadly attacks in China in recent weeks—including mass stabbings and car-ramming incidents—has unnerved officials and ordinary people alike, raising concerns that stagnating growth has played a role in fueling unrest and even outbursts of violence, amid an increase in public protests over economic grievances.

In response, the Communist Party’s security czar last month ordered nationwide efforts to “resolve conflicts at the grassroots and nip them in the bud.” China’s top prosecutor urged officials to better protect the rights of low-income workers, job-seeking graduates and vulnerable groups such as the elderly as a way to “strictly prevent extreme cases from happening.”

Officials have fanned out to screen for people who have suffered financial or emotional setbacks and assess their risks of disrupting public order. Authorities also deployed paramilitary troops to help guard some schools in Beijing and elsewhere, after some recent attacks appeared to target students. Internet censors, meanwhile, have scrubbed viral commentaries about weaknesses in the world’s second-largest economy.

At its latest meeting this month, the party’s elite Politburo implicitly acknowledged the connection between economic difficulties and social unrest, ordering officials to “protect people’s livelihoods” with the goal of “ensuring the overall stability of society.”

Xi’s challenges are formidable. Millions of young Chinese struggle to find jobs. Homeowners have been watching their property values sink, while others worry that debt-laden developers might not finish building the apartments they bought. Many migrant workers and even some government employees aren’t getting paid.

Beijing is also bracing for Donald Trump’s imminent return to the White House, with the president-elect’s promises of heavy tariffs likely to heap more stress on the Chinese economy.

Academics and activists have long tried to track protests in China as a way to assess social currents. While such unrest has typically stemmed from localized issues, such as unpaid wages and land seizures, recent dissent also reflects disillusionment among many younger and middle-class Chinese who face bleaker economic prospects, said Christian Göbel, a professor at the University of Vienna who researches state-society relations in China.

“If the party cannot protect its people and cannot make the economy grow—and these are two things that it has placed its legitimacy on—there is a problem for the party,” Göbel said.

The risks of societal spillover could also complicate Xi’s efforts to better fortify the nation for prolonged tensions with the West.

“We must firmly adhere to the bottom line of secure development,” Li Zheng, vice president of the Central University of Finance and Economics in Beijing, said in late November at an academic conference that examined links between the economy and the risks of social unrest. He said that China’s development was facing unprecedented challenges.

While authorities have long ceased publishing statistics on “mass incidents,” the official lingo for public protests, activists tracking unrest in China say their partial data indicate festering tensions.

China Dissent Monitor, a platform run by Washington-based rights advocacy group Freedom House, has tracked more than 7,000 instances of public unrest across the country over the past 2½ years—with more than 46% of incidents related to worker protests and more than a quarter involving property owners.

By tracking social media, news reports and other sources, the platform documented a marked increase in public protests this year, mostly driven by economic grievances such as unpaid wages, stalled housing projects and demands for refunds from failed businesses, said Kevin Slaten, a Freedom House researcher who oversees China Dissent Monitor.

In October, China Dissent Monitor counted 435 protests, the highest monthly tally since it started tracking such data, and the first time in about two years that the platform logged more property-related protests than instances of labor unrest.

“The party may choose to make greater use of a powerful repressive apparatus that it has built and invested in over decades, but that too carries risk of backlash,” Slaten said.

The dissent today is all the more striking given that Xi’s government has tightened curbs on protests of any kind, including economic ones spurred by labor or financial disputes that aren’t overtly political.

Xi has also placed a greater emphasis on pre-empting disputes, particularly through what he calls an updated version of the “Fengqiao experience,” a Mao-era practice of mobilizing locals to monitor their own communities and mitigating social tensions at source, scholars say.

The recent attacks provide extreme examples of what can happen when that strategy fails. On Nov. 11, a man killed 35 people by driving a car into a crowd at a sports stadium in the southern city of Zhuhai. The police said in a preliminary report about the incident that the suspect was unhappy with how assets had been split up in a divorce.

Days later, eight people were killed in a knife assault at a vocational college by a former student who authorities said had grown frustrated from failing an exam and over the pay he received during an internship.

Earlier knife attacks in recent months also targeted foreigners in China, including Japanese nationals—one of whom, a 10-year-old boy, died—and four instructors from a U.S. college who were in China as part of a partnership program with a local university.

In recent weeks, some parents of schoolgoing children have noticed heightened security at elementary schools in Beijing, where authorities have deployed paramilitary police officers—dressed in camouflage uniforms—to guard the entrances, according to social-media posts.

Police in Sui county in central China said they brought in paramilitary troops, armed with assault rifles, to help protect schools during peak hours when pupils arrive and leave. In the southern city of Foshan, residents buzzed on social media over how many local schools and kindergartens had placed concrete barriers or metal barricades outside their entrances—apparently to prevent car-ramming attacks.

Elevated security is being paired with a suppression of information about the recent attacks, with many media outlets hewing to brief statements from authorities without providing much context. “On the surface this looks like a form of stricter social governance,” Yan Zhihua, a researcher at Nanjing University’s Zijin Media Think Tank wrote in a recent Chinese magazine commentary. “But behind it is actually a purging of the information environment, which can cause society’s natural adjustment mechanisms to fail.”

More broadly, the party has continued to suppress negative commentary about China’s economy. In recent days, internet censors appeared to scrub separate speeches by two Chinese economists after they went viral, while seemingly curbing access to their social-media accounts.

One of them, Fu Peng, chief economist at Northeast Securities, a Chinese brokerage, purportedly warned at a November conference that policy missteps could arise when observers—fearful of being denounced as unpatriotic—avoid speaking candidly about the economy, according to transcripts and recordings circulated online.

This month, Gao Shanwen, chief economist at state-owned brokerage SDIC Securities, said China’s post-Covid economic data showed weaker consumption growth in provinces with younger populations compared with regions with older residents—a phenomenon observers describe as “vibrant old people, lifeless young people, and hopeless middle-aged people.”

Many young people can’t find jobs or are disappointed with the work they get, Gao told a conference, according to transcripts and videos circulated online. “Young people are scrimping on clothing and food, turning off the lights and eating noodles.”

Earlier this month, a Chinese news outlet said Fu’s video account on the WeChat social-media app was blocked from accepting new followers, though access appeared normal as of Sunday. Gao’s public WeChat account has since disappeared. Fu and Gao didn’t respond to requests for comment.