Zero Rss

Trump Teleprompter Operator Made $100K Betting On Kalshi Markets Tied To Speeches

Authored by Nate Kostar via CoinTelegraph.com,

US President Donald Trump’s longtime teleprompter operator is in talks with federal regulators to settle allegations that he used nonpublic information to profit from bets on Kalshi markets tied to the president’s speeches, ABC News reported Thursday, citing sources familiar with the matter.

According to the report, Gabriel Perez, a technical assistant who has operated Trump’s teleprompter since 2016, allegedly placed bets on more than a dozen markets tied to Trump’s speeches, generating more than $100,000 in profits.

Kalshi detected the activity through its surveillance systems and referred the trades to the Commodity Futures Trading Commission, the outlet said.

The contracts were part of the platform’s “Mentions” markets, which allow users to bet on whether particular words, phrases or topics will appear in public speeches.

According to ABC’s sources, Perez sometimes exited positions mid-speech when Trump skipped prepared passages containing words he had wagered would be mentioned. Regulators reportedly uncovered bets tied to more than a dozen speeches over roughly three months, including the State of the Union and remarks at the World Economic Forum.

The White House placed Perez on unpaid administrative leave after the report, according to press secretary Karoline Leavitt, who said Trump called the alleged conduct a “disgrace.”

Prediction markets confront insider trading scrutiny

Prediction markets have faced increasing scrutiny over potential insider trading as trading volumes have surged in recent months.

In March, six Polymarket traders earned roughly $1 million after correctly betting the United States would strike Iran before the end of February, prompting questions about possible access to nonpublic information. Bloomberg, citing analytics firm Bubblemaps, reported several wallets placed bets only hours before explosions were first reported in Tehran.

In a seperate incident, wallets earned more than $1.2 million betting on an onchain investigation into DeFi platform Axiom shortly before blockchain investigator ZachXBT published allegations of insider trading involving an employee.

Another trader also made about $400,000 by correctly wagering on the capture of Venezuelan President Nicolás Maduro shortly before the news became public.

The incidents have prompted greater attention from lawmakers and regulators. Last month, Republican Representative Bryan Steil, who chairs the House subcommittee on digital assets, introduced legislation that would prohibit members of Congress and their immediate families from trading prediction market contracts tied to public policy and political outcomes. 

Tyler Durden Thu, 07/16/2026 - 19:15

SpaceX Starship Flight 13 Launch Scrubbed At The Last Second

Update (1900ET): SpaceX scrubbed their 13th test flight on Thursday right as the countdown clock reached zero. 

Noooo! Abort triggered after 4 of the centre engines failed to ignite at start-up...as seen in the Booster engine graphic, bottom left of screen.
Video straight off the @SpaceX stream. pic.twitter.com/nZ65wfuQkb

— VixXi (@VickiCocks15) July 16, 2026

Could be wrong, but it seems that 4 engines didn’t light causing the abort sequence

Unfortunate scenario, but better safe than sorry! Hoping for another attempt tomorrow pic.twitter.com/o0BQ8Ekt7i

— Victor Kerman (@VictorKerman) July 16, 2026

Developing...

* * *

SpaceX is scheduled to launch the 13th test flight of its Starship rocket on Thursday evening, marking the first mission since the company completed its blockbuster public debut in June, according to ABC News. Liftoff is scheduled from the company's Starbase facility in Texas, with a 90-minute launch window opening at 6:45 p.m. ET. As always, weather or technical issues could delay the attempt.

The mission will be the second flight of Starship Version 3, a significantly redesigned vehicle that SpaceX believes represents a major leap forward. Charlie Cox, the company's director of Starship Engineering, described the new spacecraft as "basically a clean-sheet design," explaining that engineers took the lessons learned from the first two generations and rebuilt the vehicle to address reliability and performance shortcomings.

The launch carries added significance now that SpaceX is a public company. Beyond the engineering milestones, investors will be watching closely because another successful test would reinforce confidence in the company's long-term plans, while another high-profile setback could weigh on sentiment and potentially pressure the stock.

The ABC News report says that Starship sits at the center of SpaceX's future. NASA plans to use a modified version of the spacecraft as the lunar lander for future Artemis missions, while SpaceX also intends to use it to rapidly expand its Starlink constellation, support future space-based infrastructure, and eventually carry humans to Mars. Bill Riley, SpaceX's vice president of Starship Engineering, called Version 3 "the foundational design," adding that it will ultimately be "the one that puts humans back on the moon" and eventually "the first boot prints and then city on Mars."

The previous test flight achieved many of its objectives but also exposed several issues. The Super Heavy booster experienced propulsion problems during its return burn, resulting in a hard splashdown and an FAA investigation that has since been closed after regulators accepted SpaceX's corrective actions. Meanwhile, Starship lost one of its Raptor engines during flight, forcing the company to abandon an attempted in-space engine relight.

Flight 13 will try that engine relight once again, a critical capability needed before Starship can reach orbit and begin deploying operational Starlink satellites. The spacecraft will also attempt to release 20 next-generation Starlink satellites during the mission. Like the previous test, the flight will remain suborbital, traveling from Texas across the Atlantic before splashing down in the Indian Ocean, while the Super Heavy booster is expected to land in the Gulf.

 

"> Tyler Durden Thu, 07/16/2026 - 19:01

Biden's Memoir Given Post-Midterm Release, But Will It Hurt Democrats Anyway?

Joe Biden's publisher has picked a release date for his memoir, Promise Me, America, and the timing may reflect how little the party wants to talk about him before November.

Biden previously indicated during one of his wife Jill Biden's book events last month that his memoir would be released in September; however, its official publication date has been revealed to be Nov. 17, 2026, two weeks after the midterm elections.

USA Today framed the schedule as a gift to Democratic candidates, sparing them questions about a book.

The book, published by Little, Brown and Company, comes as Democrats are still debating Biden's initial decision to run for reelection despite concerns about his age, only to drop out less than four months before the election to allow Vice President Kamala Harris to become the nominee.

The post-midterm release will spare Democratic candidates from having to revisit any questions raised by the book during their campaigns to regain control the House and Senate. And it also means any media tour Biden goes on to promote the book would seemingly take place after the election.

The reasoning assumes any media tour built around the book will also wait until after Americans have voted in the midterms. However, that likely won't be the case.

Jill Biden's memoir, View From the East Wing, was published on June 2, 2026, but the publicity campaign began earlier, with interviews, excerpts, and advance coverage designed to build anticipation and build up pre-order sales. Joe Biden's team has every reason to run a similar playbook, as his sales figures will be heavily scrutinized by the media.

A two-minute teaser video frames Promise Me, America as an account of, in his words, "the challenges we face as a nation, about the decisions I made, and why I made them," with the most significant reveal in its pages being his two key decisions of the 2024 presidential campaign.

"It's about why I chose to run for reelection, and why I chose to step aside," he said. "Most of all, it's about my faith in the promise in America - the promise we made to those who've gone before us and to honor their sacrifice. The promise we've made to one and another, and to treat everyone with dignity and respect."

I’ve written a book about my time as President. It’s called PROMISE ME, AMERICA. It’s coming out November 17th and is available for preorder now. https://t.co/uMINr9efxS@littlebrown pic.twitter.com/yzWfZyD31A

— Joe Biden (@JoeBiden) July 15, 2026

The decision to run again is the part Democrats least want relitigated before the midterms. Some in the party already blame Trump's return to power on Biden's initial push for a second term. Biden's poor performance during that June 2024 debate led to his withdrawal a month later under pressure from senior party figures. He dropped out 107 days before the election, leaving Vice President Kamala Harris a nomination and a campaign calendar many argue made it impossible for her to win.

CNN's chief data analyst Harry Enten warned last month that Joe Biden's unpopularity could sink Democrats in the midterms.

"Look at Biden's net favorable rating. In January 2025, it was minus twenty-two points. Has it gotten any better? No! Not really!" he said. "He's still way underwater here at minus nineteen points ... he is an anchor to the Democratic Party and potentially their fortunes in the 2026 midterm elections."

Americans have one message for the Bidens: Go away.

Joe Biden left office tremendously unpopular & remains so (-19 pt net favorable).

He's by far the least popular of any former Dem prez at this point after their presidency.

Jill Biden was the least popular Dem first lady. pic.twitter.com/gpJK8bzM1D

— (((Harry Enten))) (@ForecasterEnten) June 4, 2026

If Joe Biden starts doing interviews weeks in advance, that conversation could complicate matters for the Democrats as Americans head to the polls in November.

Tyler Durden Thu, 07/16/2026 - 18:50

Canadian Woman Detained By ICE For Attacking Teens Wearing Trump Pants

A defining character trait of the average leftist is the complete lack of emotional impulse control (often a sign of bad parenting and a low IQ).  Rarely if ever do we see news stories about conservatives and Trump supporters being arrested for "crashing out" and violently attacking random progressives on the street because their eyes caught a glimpse of a Kamala Harris hat or a gay pride flag. 

Progressive activists, on the other hand, are predictably violent, often because they assume there will be no consequences for their actions.  This week an angry Canadian woman learned the hard way that this is not the case.

Kaitlyn Tracey, a 33-year-old Canadian citizen living in the US with her American husband in New Jersey, has been arrested by ICE agents after allegedly fleeing the scene of an attack on a group of four teenage girls.  Over the Fourth of July weekend, Tracey was reportedly seen on surveillance video confronting a group of teens in Point Pleasant Beach, some of whom were wearing pants with the words "Trump" and "ICE" on them. 

The four friends were walking on the boardwalk on July 3rd when Tracey approached them as she recorded with her phone, according to court documents.  Tracey yelled at the two people in the group wearing “patriotic colored” sweatpants with pro-Trump messages before she slapped one victim across her face and body, an affidavit of probable cause stated. 

Tracey then left on foot.  She was apprehended by police after being identified from the surveillance footage.  They allowed her to leave after making a statement, but a warrant was later issued for her arrest and Tracey turned herself in, only to be released into ICE custody for deportation.  

Here are some videos of the Canadian leftist who attacked a pro-Trump teen in New Jersey.

She and her husband previously lived in Texas with his father before abruptly relocating to NJ. His followers have been asking what prompted the sudden move. The couple appears to have had… https://t.co/bFJOySwHy8 pic.twitter.com/dhbZgstsFc

— I Meme Therefore I Am 🇺🇸 (@ImMeme0) July 15, 2026

She was then taken to Delaney Hall in Newark - the site of endless clashes between left-wing agitators and ICE agents.  Tracey’s criminal charges include endangering the welfare of a child and simple assault, according to reports.  It should go without saying, but getting triggered by Trump pants is not a valid reason to assault a kid. 

The Canadian woman has been living in the US for a little over a year with her American husband, Matthew Geroni, who also has a social media record of left-wing activism.  She has not, however, applied for a Green Card or permanent citizenship is considered to be illegally residing in the country.  Her husband has taken to TikTok to plead for her release. 

Kaitlyn Tracey is a criminal illegal alien from Canada who was charged with simple assault, neglect of a child, compounding crime, and harassing communication.

She allegedly struck a teenage girl wearing pro-Trump memorabilia on a boardwalk in Point Pleasant Beach during 4th of… https://t.co/NETqKKwrE8 pic.twitter.com/ER7qO3z3Zo

— Homeland Security (@DHSgov) July 15, 2026

Obviously, these people are not winners.  Tracey is not the type of person that the US should welcome as a potential citizen and the couple is a reflection of the underlying political poison that leftist activism represents.  Her husband, Geroni, routinely posts on TikTok attacking conservatives and has posted content wishing "cancer" on Donald Trump and his entire family, including “little kids.” 

Beyond the question of economic standards when it comes to the quality of immigrants coming to the US (people who are broke and have no skills should not be allowed into the country), this incident also puts a spotlight on the issue of political standards for immigration.  Should access to the US be rejected based on a person's history of political activism? 

Maybe denying entry to leftists from other countries would be a sensible measure given how violent they tend to be when encountering anyone with an opposing view?     

Tyler Durden Thu, 07/16/2026 - 18:00

What To Know About Iran's Pickaxe Mountain

Authord by the Institute for Science and International Safety (view PDF)

On July 13, President Trump made it clear that the nuclear-related Pickaxe mountain facility is on the U.S. target list. In an interview on the Hugh Hewitt show, the President stated, “We have eyes on it and Pickaxe mountain is a possible target for a nice big fat shot right in the front door…We’re watching Pickaxe Mountain very closely. We don’t see any activity there.” Trump finished the interview with a more definitive statement: “We're going to take out Pickaxe Mountain. Tell the Iranians to be ​ready.” The tunnel facility under construction has not been previously targeted in either June 2025 or 2026 war, aside from the destruction of a vehicle on a nearby spoil pile, which we believe was most likely associated with air defense.  Our assessment of satellite imagery to date is that the facility is not yet operational, but construction continues.

This nuclear-related site is south of the Natanz enrichment plant, part of a large perimeter secured site that includes another, smaller tunnel complex, initially built in 2007, which was expanded and hardened in recent years and sealed shortly after the June 2025 war. 

The large mountain harboring the main tunnel complex is called Kuh-e Kolang Gaz La, where Kolang translates to Pickaxe, resulting in today’s nickname of the site.  Construction of the Pickaxe mountain facility started in the fall of 2020, and at the time Iran announced that the underground halls were intended to replace the destroyed above-ground advanced centrifuge assembly facility at the main Natanz site. [1]  The destroyed site was designed to assemble about 6000 advanced centrifuges per year, a large capacity, sized to produce the tens of thousands of advanced centrifuges during and after the phasing out of Joint Comprehensive Plan of Action limits from 2025 through 2030.

The Pickaxe mountain site features two pairs of entrances leading under the ridge of the mountain.  They are assumed to lead to one facility, but this is not guaranteed.  The facility is estimated to be at least 100 meters deep under the mountain.  The mountain has a height of 1608 meters above sea level.  The difference in elevation between the eastern entrance and the mountain ridge is about 145 meters.  The difference in elevation between the western entrance and the ridge is about 100 meters [2].  The difference in elevation between the two sets of entrances of about 50 meters could also indicate that the facility has multiple levels. 

The physical defensive measures consist primarily of a large security perimeter and extensive tunnel entrance hardening.  In 2025, Iran started constructing a double (fence and wall) security perimeter with a patrol route surrounding the entire mountain and adjoining the Natanz Nuclear Complex security perimeter.  All four tunnel entrances are excavated in a channel of rock.  Two of the four tunnel portals feature entrance extensions with subsequent hardening. This includes layers of concrete and earth over the tunnel portal entrances.  Since the wars, Iran partially backfilled the pair of eastern tunnel portal entrances to obstruct ground vehicle access but did not seal them fully as previously noted at the 2007 tunnel, the Esfahan tunnel, or the Fordow underground enrichment plant.

It remains unclear when Pickaxe Mountain could be operational, based only on assessments of satellite imagery.  It is also unclear if Iran still plans on installing a large-scale assembly facility, given the destruction of Iran’s centrifuge program, including Iran’s ability to make centrifuge components needed for an assembly plant.  Nonetheless, if Iran starts to rebuild its centrifuge manufacturing capability, it could plan to install a smaller centrifuge assembly facility in Pickaxe Mountain able to serve a nuclear weapons program.  In addition to the originally planned centrifuge assembly plant, the space available under the mountain could be expected to be large enough to also hold a centrifuge enrichment plant capable of producing weapon-grade uranium.  It is likely large enough to also hold certain nuclear weaponization activities such as making weapon-grade uranium metal and shaping it into nuclear weapon components. 

Any operations inevitably have ties to the outside, including via imported equipment, power supply, ventilation, heating, cooling, construction personnel, operating personnel, and deliveries.  All of these connections to the outside present vulnerabilities that the U.S. and Israel would seem to be able to exploit.

The site, in its present condition, would be more suitable for ground forces to attack or sabotage like the destruction of the advanced centrifuge assembly center, which reportedly involved explosives that were brought into the facility during its construction.

However, vulnerabilities may also exist that can be exploited by deep earth penetrating weapons via aerial attacks.  These would be best identified in facility schematics. Schematics for the Pickaxe Mountain facility have not been seen publicly, however, schematics for two other prominent Iranian nuclear tunnel sites, Fordow and Shahid Boroujerdi, have been. These are two tunnel facilities built by Iran’s Amad nuclear weapons program and attacked in June 2025 and March 2026, respectively; both schematics showed ventilation shafts, and both facilities had ventilation shafts directly targeted in aerial attacks, a weak point that allowed greater internal access for earth penetrating weapons. 

In line with the attacks on these two sites, an attack on Pickaxe Mountain could target the above ground incoming power supply lines, the location of ventilation shaft(s) or equipment, and the open tunnel entrances.  The latest imagery from July 9, 2026, shows that the pair of western tunnel entrances remain open, leaving them vulnerable to both precision strike weapons or a ground operation entering the facility via those tunnels.  Air defenses appear easily overcome as was shown by Israel’s very early attacks on the Natanz enrichment complex in June 2025 and two separate attacks in March-April 2025.  Airstrikes targeting solely the hardened tunnel portal entrances, without shockwaves or blast impact affecting the facility, would likely only temporarily deny Iran access and would add Pickaxe mountain to the list of facilities to be watched closely for Iranian attempts to regain access.   

Figure 1 below shows an overview of the site. Figure 2 shows potential ventilation shaft locations. Figure 3 shows the probable ventilation shaft near the Eastern set of tunnel entrances under construction in 2024. 

Figure 1.  A June 30, 2026, Vantor Technologies image overview of Pickaxe MountainFigure 2.  A June 30, 2026, Vantor Technologies image of Pickaxe Mountain showing potential locations for ventilation shafts.  The one near the eastern tunnel entrance can be considered a “probable” location given the construction identified in 2024 and shown in Figure 3 below. Figure 3.  The probable ventilation shaft near the eastern tunnel entrances under construction in 2024.  Power is supplied to this location via an above-ground powerline that turns into a buried powerline. 

 

[1] David Albright, Sarah Burkhard, and Frank Pabian, “Looking for Evidence of the Construction of Iran’s New Centrifuge Assembly Plant,” Institute for Science and International Security, October 7, 2020, https://isis-online.org/isis-reports/looking-for-evidence-of-the-construction-of-irans-new-centrifuge-assembly. ; David Albright, Sarah Burkhard, and Frank Pabian, “Update on New Construction Activity at Natanz,”  Institute for Science and International Security, October 30, 2020, https://isis-online.org/isis-reports/update-on-new-construction-activity-at-natanz. 

[2]More conservative estimates done earlier in the construction process used a difference of 78 meters in elevation between the Western entrances and the mountain ridge. https://isis-online.org/isis-reports/irans-natanz-tunnel-complex-deeper-larger-than-expected. 

Tyler Durden Thu, 07/16/2026 - 17:40

Netflix & Spill: Streamer Smashed To 2 Year Low After Forecast Misses Across The Board

It has been a brutal year for NFLX longs, who have seen their favorite stock slide in a straight line since last summer, erasing almost 50% from the July 2025 all time high of $134. And unfortunately for them, it appears this brutality isn't going to end any time soon after the company mangled its Q2 earnings moments ago, reporting mediocre earnings, but more importantly, projecting numbers that missed consensus estimates for both Q3 and and the full year.

First, looking at the historicals, we find results that just barely beat expectations, while US and Canada revenue outright missed.

• EPS 80c, barely beating the est 79c, and up from 72c y/y

• Revenue $12.56 billion, +13% y/y, barely beating the est $12.58 billion
  • US & Canada revenue $5.43 billion, +10% y/y, missing estimate $5.52 billion
  • EMEA revenue $4.03 billion, +14% y/y, matching estimate $4.03 billion
  • Latin America revenue $1.58 billion, +21% y/y, beating estimate $1.51 billion
  • APAC revenue $1.51 billion, +16% y/y, missing estimate $1.53 billion
     
• Operating income $4.19 billion, +11% y/y, beating estimate $4.13 billion
  • Operating margin 33.4% vs. 34.1% y/y, beating estimate 33%
     
• Cash flow from operations $1.74 billion, -28% y/y, missing estimate $2.93 billion
  • Free cash flow $1.53 billion, -33% y/y, badly missing estimate $2.72 billion... maybe they too are building a data center.

While historical were lously at best - it was the company's projections that spooked the market: the company projected revenue of $12.9 billion in the current quarter and earnings of 82 cents a share, both missing analysts’ expectations. And since most of Wall Street's attention had been on future performance, this was enough to send the stock plunging.

Q3 forecast

• Sees EPS 82c, missing the estimate 84c 
• Sees revenue $12.86 billion, missing estimate $13 billion
• Sees operating income $4.27 billion, missing estimate $4.36 billion
• Sees operating margin 33.2%, missing estimate 33.5%

Full year forecast 

• Sees revenue $51 billion to $51.4 billion, saw $50.7 billion to $51.7 billion, midpoint missing estimate $51.38 billion
• Sees revenue +13% to +14%, saw +12% to +14%
• Still sees operating margin 31.5%, missing estimate 31.7%
• Still sees free cash flow about $12.5 billion, missing estimate $13.09 billion

Commenting on the quarter, Netflix said it is "building out our ads business continues to be a top priority and we remain on track to deliver approximately $3 billion in ads revenue in 2026." While the collapse in free cash flow was surprising (and begs the question if NFLX is also building a data center), the company said it is continues to expect annual cash content spend to amortization ratio of ~1.1x.

Commenting on the latest price hike(s)- which now happen every quarter if not every month, the company said that "the results of our recent price changes are consistent with prior changes and our expectations." That bad, huh?

NFLX also said that it was "leveraging AI to provide a more personalized, immersive and interactive experience for members, enhance ads capabilities for brands, and improve the quality of our series and films."

Translation: crap content, now with even more slop.

As noted above, NFLX shares have plunged more than 40% over the last year, as the company’s pursuit of Warner Bros. Discovery and subsequent financial results have caused investors to realize that the leader in streaming has lost momentum. While Netflix still has more subscribers and viewership than any other paid streaming service, engagement has fallen off a cliff as growth in sales and hours spent on the service has been slowing.

If that wasn't enough, Netflix endured a months-long drought of new hits in the first half of the year, during which many returning shows struggled to retain viewers in the new seasons. That dry spell ended with I Will Find You, an adaptation of a Harlan Coben novel, which was Netflix’s most-viewed new original series this year, and frankly, was at best a 4 out of 10. 

Netflix has announced a flurry of new details with popular social media personalities in recent weeks, including YouTube stars Alan Chikin Chow and Nick DiGiovanni, and even touted its use of generative artificial intelligence on about 300 shows.

In other words, it has tried everything and still people are turning off. 

The company sought to reassure restive investors by outlining a plan to sustain growth in the coming years. It is investing in new kinds of programming, such as live sports and video podcasts. Podcasts are attracting more viewers during the day and on mobile devices while live programming has helped attract a lot of customers relative to its actual share of viewing, the company said.

“We are increasingly leveraging these tools to deliver higher quality output more quickly and at a lower cost than traditional methods,” the company wrote in its letter to shareholders. Netflix has resumed offering free trials in select markets as a test.

The amount of time people spend on Netflix grew 2% in the first half of 2026, a slight improvement over a year ago. The company said that was good, especially given the competition from the World Cup and Winter Olympics, which aired on other networks. Netflix also said it will now release its What We Watched report on show viewership annually, rather than twice a year.

None of that however is helping as markets look at the continued decline in growth and wonder, when does it end? Clearly not today with the stock plunging to a fresh 21 month low...

.... and set up for the ultimate head and shoulders pattern.

Tyler Durden Thu, 07/16/2026 - 16:44

The Odyssey Hullabaloo

Authored by Victor Davis Hanson via American Greatness,

Acclaimed British filmmaker Christopher Nolan's (The Dark Knight, Oppenheimer) newest film, The Odyssey, opens this week in the United States.

But controversy has already surrounded Nolan's adaptation of Homer's 2,700-year-old epic poem about Odysseus's 10-year struggle to return home after the Achaian victory in the decade-long Trojan War.

Some of the film's actresses have suggested that Nolan is offering a more feminist - and long-overdue - take on the ancient poem. Actress Lupita Nyong'o, in particular, has criticized Homer's purported sexism.

Perhaps her misreading of Homer stems from her admission that, despite receiving degrees from elite Hampshire College and Yale, the 42-year-old actress had never even read the Odyssey until she was cast in the minor dual roles of Helen and her sister Clytemnestra.

The Odyssey was composed orally sometime around 750-700 B.C., contemporaneously with the rise of the Greek city-state. Along with Homer's other epic, The Iliad, The Odyssey marks the inauguration of Western literature. Over the next three millennia, it came to be recognized as not only the earliest but also one of the most profound works of Western civilization.

Far from being sexist, Homer's Odyssey offers a timeless and diverse panorama of powerful, independent, and savvy women.

Take Penelope, the wife of Odysseus and queen of Ithaca. Unquestionably loyal to her missing husband, she outsmarts the bloodthirsty suitors who seek to force her into marriage and seize the kingdom through her steadfast courage and cunning.

She confounds them through a series of brilliant ruses, ultimately enabling her husband's revenge.

Far different, but equally independent and crafty, are the immortal sorceress Circe and the divine nymph Calypso, who both shelter, seduce, and eventually bond with Odysseus. Both ultimately release him to continue his tragic journey home. Together they serve as archetypes of unmarried women who choose to live magical lives on their own sexual, economic, and political terms.

Helen makes a cameo appearance in both the poem and the film. Her beauty is all-powerful and dangerously - even destructively - seductive. It prompts the Trojan boy toy Paris to kidnap her, win her over, and flee back to Troy, setting in motion the decade-long Greek expedition against Troy and the extraordinary effort to bring the beauty home to her cuckolded and vapid husband, King Menelaus of Sparta.

Without the help of the virgin goddess Athena - often regarded as the wisest, most stable, and most humane of the Olympian gods - Odysseus would never have reached home.

By the same token, among the kindest figures in the poem are Odysseus's loyal nurse, Eurycleia, Penelope's trusted confidante, and the young, innocent Phaeacian princess Nausicaa, who befriends Odysseus and ensures her parents' goodwill toward him, eventually securing his safe return to Ithaca.

The monstrous, man-destroying female Scylla and the Sirens are every bit as deadly, but far more astute than the cannibalistic and dimwitted Cyclops Polyphemus.

Far from being sexist, then, The Odyssey offers the earliest - and one of the finest - gallery of capable women in Western literature.

Controversy also arose from Nolan's casting of Kenyan-Mexican-American actress Lupita Nyong'o as a black Helen, contrary to the Spartan queen's ethnicity in Homer's poem.

Cultural appropriation is a heated but often inconsistently applied charge. (When white women wear dreadlocks, that is somehow deemed to be cultural appropriation; black women wearing blond wigs isn't?)

Yet there is a long history of directors using marquee actors to play characters of different races or ethnicities. British actor Laurence Olivier achieved fame by brilliantly playing Shakespeare's black Othello. Mexican-American and Irish Anthony Quinn portrayed a stunning Zorba the Greek. Burt Lancaster, Charles Bronson, and Audrey Hepburn all effectively portrayed Native American characters.

In the age of sophisticated makeup and costuming, great actors can believably play almost any role. Problems arise only when a literary or historical figure's race or gender is so central to the character that it permeates the entire narrative of the film, novel, or poem.

No white actor could play a believable Martin Luther King Jr. or Muhammad Ali. Nor could a black actor be believable as Abraham Lincoln. Nor could a woman realistically play James Bond - Ian Fleming's womanizing playboy and hypermasculine secret agent 007.

Now, in Nolan's defense, Helen is a minor figure in both the poem and the film version of the Odyssey. That she was white in the poem and black in the film does not undermine the adaptation of Homer's poem. But had Lupita Nyong'o perhaps played the key character of Penelope, then the glaring racial disparity might have introduced new and extraneous issues or distracted from the central narrative.

A final note.

The Odyssey is an embodiment of Hellenic culture - and still deeply revered in Greece as an iconic symbol of the ongoing national experience. Given the tradition of brilliant Greek actresses such as Irene Pappas or Melina Mercouri, Nolan might have employed at least one Greek actor or actress in an epic about the indomitable people of Greece.

Tyler Durden Thu, 07/16/2026 - 16:20

American Naval Academy Cadets Prepare For War With Stoic Philosophy

Authored by Ret Admiral Cem Gürdeniz via Mavi Vatan Geopolitics,

The United States Naval Academy at Annapolis, which has trained officers for the U.S. Navy since 1845, reports directly to the Chief of Naval Operations (CNO). There is no separate Naval Education and Training Command within its chain of command. Today, Annapolis is not the Navy's only source of commissioned officers. The U.S. Navy also commissions officers through the Officer Candidate School (OCS) and the Naval Reserve Officers Training Corps (NROTC) programs conducted at universities across the country.

Each year, the U.S. Navy commissions approximately 2,500-3,000 new officers, of whom roughly 1,000-1,100 graduate from Annapolis. Although the Academy provides only about one-third of the Navy's annual officer intake, it produces a disproportionate share of its future strategic leaders, fleet commanders, and candidates for the position of Chief of Naval Operations (CNO).

In American naval culture, Annapolis graduates are known as "Ring Knockers." Their distinctive class rings symbolize far more than a shared educational background. They represent the strategic tradition, institutional memory, and elite leadership culture of American sea power. It is therefore no coincidence that Annapolis graduates have historically occupied a dominant position within the U.S. Navy's admiralty and its most critical command appointments.

The Foundation of Imperial Power Is Naval Power

Throughout its history, the backbone of American global and imperial power has been its navy. During the Second World War in particular, aircraft carriers, battleships, cruisers, destroyers, submarines, and millions of tons of ammunition produced by American industry on an unprecedented scale were employed by commanders educated at Annapolis in pursuit of U.S. political objectives. The naval supremacy achieved at the end of the war elevated the United States to global leadership not only in military terms but also economically and geopolitically.

Yet the strength of a navy cannot be measured solely by its ships, weapons, or technology. The decisive factor is the strategic culture, value system, and intellectual tradition that shape the officers entrusted with commanding that force. To understand American naval power, one must therefore examine the historical, philosophical, moral, and spiritual environment in which its officers are educated. This is precisely what makes Annapolis unique and significant.

Annapolis is more than a military academy; it reflects the American state, society, and strategic culture. For that reason, understanding the education provided there and the intellectual outlook of its graduates requires an examination of the political and social environment in which the Academy operates. In particular, the place of religion in American public life and its influence on politics constitute an important element of this broader cultural context.

Religion and Its Place in American Politics

Religion continues to play a significant role in American public life and politics and has become increasingly visible in recent years, particularly through conservative Christian circles and the evangelical movement. Unlike the stricter model of secularism found in much of Europe, the United States has traditionally adopted an approach that does not exclude religion from the public sphere. As a result, religious influence remains evident across many aspects of American society, from education to politics.

Following the strengthening of U.S.-Israel relations after 1967 - and especially during the period that gained momentum after the September 11 attacks - the influence of Christian Zionist circles, particularly evangelical Christians, on American policy toward Israel became increasingly pronounced. Especially within the Republican Party, support for Israel is viewed not only as a strategic necessity but also as a religious obligation rooted in biblical interpretation. During the recent Israel-Iran confrontation, religious services, sermons, and spiritual guidance provided by military chaplains in some U.S. military units reflected this broader trend.

The influence of religion is also visible at the U.S. Naval Academy in Annapolis. The campus contains nine chapels and spiritual support centers serving different faith communities. These institutions function not only as places of worship but also as centers for character development, ethical leadership, spiritual resilience, and the cultivation of the will to fight. Their presence demonstrates that religion has not been excluded from institutional life within the U.S. Armed Forces, rather, it continues to be regarded as one of the elements that strengthen morale, cohesion, and resilience. To fully understand the cultural environment in which Annapolis educates America's future military and political leaders, the continuing prominence of religion in American society must therefore be considered.

Stoic Training for American Naval Officer Candidates

In recent years, the U.S. Naval Academy has undergone a remarkable evolution in its educational philosophy. Alongside traditional military instruction, Stoic philosophy has been incorporated into officer education, introducing cadets to the works of Marcus Aurelius, Seneca, and Epictetus. The objective is not to promote a new belief system, but to develop leaders capable of making sound decisions under uncertainty, enduring hardship, mastering fear, exercising self-discipline, and demonstrating strength of character in combat.

This approach has moved well beyond theory. During the 2024 and 2025 Plebe Summer programs, the Academy introduced a six-week voluntary Stoicism course for incoming midshipmen. Participants learned to distinguish between what lies within their control and what does not; to regard adversity as an opportunity for character development; to confront the possibility of death and failure with composure; to value inner discipline over external recognition; and to judge events rationally rather than emotionally. In this context, Stoicism is taught not as an ancient philosophical tradition, but as practical preparation for the psychological demands of war.

This educational shift also reflects a broader transformation in the U.S. Navy's concept of leadership. At a time when artificial intelligence and autonomous systems are becoming increasingly central to warfare, the Navy seeks to produce officers who are not only technologically proficient but also capable of preserving sound judgment, emotional stability, and psychological superiority under the extreme pressures of combat. In the wars of the future, victory will depend not only on superior technology, but also on the character, resilience, and moral strength of those entrusted to employ it.

Why Stoicism?

Originating more than 2,300 years ago, Stoicism is a philosophy of life that teaches individuals to master their own minds in the face of events beyond their control. No commander can know with certainty what an enemy will do, how a war will unfold, or when death may come. In the face of such uncertainty, Stoic philosophy seeks to replace fear with reason, anger with composure, and despair with a steadfast sense of duty. Stoicism is therefore not a doctrine of passive fatalism but a philosophy for cultivating warriors capable of preserving their will and judgment under the harshest conditions.

This is precisely why Annapolis has reintroduced Stoicism into its curriculum. The objective is not to teach ancient philosophy for its own sake, but to equip future naval officers with the mental discipline required to make sound decisions under pressure, demonstrate psychological resilience, and remain focused on their mission regardless of circumstances.

This educational choice also reflects the U.S. Navy's evolving understanding of "spiritual readiness." The Navy seeks to unite personnel from different religious traditions - as well as those with no religious affiliation - around a common ethic of character, duty, and leadership. In this context, Stoicism provides a secular, non-sectarian framework for moral and character development that can serve as common ground for all. States may adapt to changing patterns of religious belief within society, but military institutions cannot rely on a shared faith alone. To prevail in war, they require officers who share a common character rather than a common creed.

The broader message Annapolis seeks to convey is that the wars of the twenty-first century will not be decided solely by artificial intelligence, hypersonic weapons, or autonomous systems. They will also be contests of the human mind, resilience, and the will to fight. Technology remains only an instrument of war; victory ultimately belongs to those who can employ it wisely under pressure, hardship, and uncertainty.

Perhaps no quotation captures this philosophy better than the words traditionally attributed to the Stoic Roman Emperor Marcus Aurelius: "Be like the rock against which the waves continually break; it stands firm while the raging waters are stilled around it." In war, what ultimately proves decisive is neither enemy fire nor violent storms, but the commander's ability to preserve clarity of mind and firmness of will. At Annapolis, young officer candidates are therefore taught a simple but enduring principle: first master your mind, then fight.

Change in American Society

The U.S. Naval Academy's renewed emphasis on Stoic philosophy represents more than an educational reform; it reflects the impact of profound sociological changes in American society over the past two decades on the nation's military institutions. As affiliation with organized religion has steadily declined - particularly among Generation Z - the number of Americans who identify with no religious tradition, commonly referred to as the "Nones," has grown rapidly. The leadership at Annapolis recognizes that a significant proportion of incoming midshipmen are no longer motivated by traditional religious references to the same extent as previous generations.

This trend is equally evident within the U.S. Navy itself. Approximately 40 percent of enlisted sailors do not identify with any religious tradition, while roughly 15 percent of newly admitted midshipmen at Annapolis report no religious affiliation. This demographic transformation has been one of the principal reasons for incorporating Stoicism into the Academy's broader concept of "spiritual readiness."

According to the U.S. Naval Academy, spiritual readiness is the inner resilience and moral strength that enable a warrior to perform his or her duty with honor under the most demanding circumstances. Rather than reinforcing a particular religious tradition, the Navy seeks to cultivate a shared ethic of character, duty, and commitment among personnel from diverse faiths - or from no faith at all. Consequently, Stoicism has become an integral component of the Academy's spiritual readiness program rather than simply another subject within ethics education. Combat readiness is thus understood in holistic terms, encompassing not only physical endurance, technical competence, and tactical proficiency, but also psychological resilience, moral character, and spiritual strength.

One of the most influential symbols of this philosophy is Admiral James Stockdale. After being shot down during the Vietnam War, Stockdale endured seven and a half years of imprisonment, torture, and solitary confinement in Hanoi. He later explained that his ability to preserve his mental resilience owed much to the teachings of the Stoic philosopher Epictetus. For this reason, Stockdale's experience continues to serve as one of the most powerful sources of inspiration for Stoic education at Annapolis.

This educational choice also reflects a broader feature of American strategic culture. As Samuel P. Huntington argued, military institutions cannot remain completely insulated from social change, yet they must preserve a distinct professional ethic if they are to retain their combat effectiveness. Annapolis' rediscovery of Stoicism is one of the clearest contemporary expressions of this principle. The objective is not to replace or diminish religion, but to place a universal, non-sectarian philosophy of character at the center of officer development, thereby preserving the timeless military virtues required for war in an increasingly diverse and changing society.

Fighting in the Mud

One of the enduring truths of war is that a nation can bomb a country for months, destroy its infrastructure, and exploit overwhelming technological superiority. Yet if it truly intends to impose its political objectives, occupy territory, or establish a lasting order, it must eventually send its young soldiers into the mud. This memorable observation by the American military historian T. R. Fehrenbach, written about the Korean War, captures the timeless essence of warfare. The ultimate measure of military success is not technological superiority alone, but a society's willingness to bear the human cost of war.

It is here that the fundamental distinction between a war for the homeland and an overseas geopolitical war becomes apparent. People are prepared to fight - and, if necessary, die - for their own land, their families, their nation, and their future. It is far more difficult to inspire the same level of sacrifice thousands of miles from home in pursuit of political objectives, energy routes, or geopolitical ambitions that are remote from their daily lives.

The great power competition of the twenty-first century will therefore not be determined solely by artificial intelligence, hypersonic missiles, or autonomous systems. It will also be a contest over how societies understand death, suffering, sacrifice, and the burden of prolonged war. The defining strategic question of the future is not simply who develops the most advanced technology, but which society remains willing to bear the costs of employing it over time. As throughout history, victory will ultimately belong not to those who possess the most sophisticated weapons, but to those whose people retain the determination to endure hardship, accept sacrifice, and, when necessary, continue fighting in the mud until the mission is accomplished.

Conclusion

The transformation taking place at Annapolis, US Naval Academy is far more than an educational reform. It reflects a profound shift in strategic thinking - one that recognizes technological superiority alone cannot guarantee victory in twenty-first-century warfare. The U.S. Navy is seeking to prepare the future warrior not merely as a master of artificial intelligence, hypersonic weapons, and autonomous systems, but as a leader capable of making sound decisions under uncertainty, maintaining psychological resilience, and remaining steadfast in the ethics of duty.

This transformation is driven not only by military necessity but also by the sociological evolution of American society. As affiliation with organized religion declines and individuals from diverse faiths - or from no faith at all - serve under the same uniform, the Navy seeks to cultivate a common will to fight based not on shared religious doctrine but on shared character and enduring values. In this context, Stoicism has regained relevance not as an ancient philosophical school, but as a secular framework for character formation suited to the demands of modern military leadership.

Ultimately, this reflects one of the timeless realities of war. Artificial intelligence may identify targets, autonomous systems may deliver firepower, and algorithms may accelerate decision-making. Yet none of them can overcome fear, embrace sacrifice, or choose to risk death in the fulfillment of duty. The decisive factor in future warfare will therefore remain not technology itself, but the mind, character, and fighting spirit of the human being who employs it.

Perhaps this is the true reason Annapolis has rediscovered Stoicism. The U.S. Navy is not simply developing new weapons; it is shaping the mindset of the future warrior. History has repeatedly demonstrated that victory belongs not to those who possess the most advanced technology, but to those who preserve their discipline, resilience, and will to fight under the harshest conditions.

Sources:

The Stoic Anchor: Expanding Spiritual Readiness at the U.S. Naval Academy, By Commander Matthew Krauz, U.S. Navy, and Marcus Hedahl, June 2026, USNI Proceedings

Improving Spiritual Readiness in the Navy, By Commander Matthew B. Krauz, U.S. Navy, December 2025, USNI Proceedings

Tyler Durden Thu, 07/16/2026 - 15:40

Iran Tells Houthis To Close Red Sea Energy Chokepoint If Trump Bombs Power Grid

Yemen's Houthis have long warned of their ability to close the Red Sea oil route, but have by and large stayed on the sidelines of the expanding Gulf regional conflict which is focused on Iran since Operation Epic Fury began.

Things began changing dramatically this month, however, after Saudi warplane incursions into Yemen - which bombed Sanaa International Airport on July 13 - in an effort to prevent an Iranian commercial jet from landing there.

via Marine Insight

The Houthis responded by sending missile and drones on Saudi Arabian airbases and infrastructure, opening up the possibility of renewed Saudi-Houthi war (hearkening back to the more intense war of the prior decade).

Houthi rhetoric is growing, related to the US-Israel war on Iran:

The leader of Yemen’s Houthi movement has denounced US and Israeli collaboration as the source of the problems in the Middle East.

In a televised address, Abdel-Malik al-Houthi also blamed Saudi leaders for advancing US and Israeli objectives in the region. “The United States and Israel are the source of evil and instability in the world,” al-Houthi said.

In a rare moment of the now long-running conflict, on Thursday reports have emerged that Tehran is actively requesting that the Houthis join the war in the scenario that Washington begins attacking Iran's power infrastructure.

This is after President Trump told Fox News on Tuesday evening that "Next week it gets really bad for them because next week comes the power plants."

"Next week comes the bridges. We’re going to knock out all their power plants. We’re going to knock out all their bridges unless they get to the table and negotiate," he warned.

But according to Reuters, Iran still has another escalatory card of its own to play:

Iran has asked Yemen’s Houthi rebels to stand ready to close the Red Sea oil route if the United States strikes Iranian power infrastructure, three sources told Reuters on Thursday, posing a potent new threat to global energy supplies.

The idea has been discussed within the Islamic Republic’s leadership, and the message has been conveyed to Iran’s Houthi allies, two senior Iranian sources and a regional source familiar with the matter said, speaking on condition of anonymity. The sources said the Houthis had been informed recently of Tehran’s request, which has not been previously reported.

It's long been reported that the Houthis have indeed been making preparations to attack shipping by deploying missiles and drones near Bab el-Mandeb Strait, which is the crucial entry point to the Red Sea.

The Telegraph, citing sources in Yemen, reports that the Houthis are preparing contingency plans to close the Bab al-Mandeb Strait in coordination with Iran if Tehran decides to escalate the conflict further.

According to the report, the Houthis are expanding ties with Somalia's… pic.twitter.com/2ugHuY5Wde

— OSINTdefender (@sentdefender) July 16, 2026

This could obviously greatly exacerbate the global energy crisis - and would likely set off a new round of regional escalation - which might also see Houthi missiles once again targeting southern Israel, but also Saudi Arabia and the GCC allies.

Tyler Durden Thu, 07/16/2026 - 15:20

Cameco And Brookfield Positioned To Lead New Jersey's $24 Billion Nuclear Build Out

New Jersey has launched a competitive procurement process for new nuclear capacity under the Power New Jersey Act signed last month. The framework targets at least 1,100 MW of electrical power (MWe) at pre-approved sites and carries an estimated $24 billion price tag. 

Westinghouse's AP1000 reactor sits coincidentally at about ~1,200 MWe.

State officials are emphasizing shovel-ready locations and lessons learned from earlier projects to accelerate deployment. Federal financing tools that can cover up to 80% of costs are expected to play a central role, such as from the DOE's Energy Dominance Financing Office.

This state move sits squarely inside the larger federal nuclear effort we have tracked since last fall. We reported in detail on the $80 billion strategic partnership between the U.S. government, Cameco, and Brookfield to advance up to 10 Westinghouse AP1000 reactors. Cameco leadership later indicated the combined opportunity across Department of Commerce and Department of Energy channels could reach as many as 20 AP1000 units. 

Several utility pairs already sit in advanced planning stages, with work progressing on long-lead items and financing models that range from federal build-own-operate structures to support for existing operators.

While state officials and the current procurement documents continue to describe the effort as targeting 1,100 MW, the underlying economics and signals from the federal side point to something larger. 

Cameco (and MIT) has been clear that meaningful cost reductions are likely to appear on the third and fourth AP1000 units, and the DOE’s broader program has consistently favored paired reactor deployments that allow shared infrastructure, long-lead procurement, and supply chain efficiencies. 

Given that the PSEG Early Site Permit already authorizes two units at the site, the publicly stated 1,100 MW floor may simply be the minimum the process is required to deliver while the actual project that clears the competitive negotiation ends up being a full two-reactor plant once the federal financing package and execution commitments are locked in.

Cameco and Brookfield bring distinct advantages into the New Jersey process. Their controlling stake in Westinghouse, combined with direct involvement in the federal large-reactor program and Brookfield's separate partnership with The Nuclear Company to scale deployments, positions them to handle the capital intensity and leverage federal backstops at scale. 

The state's preference for proven large-reactor execution over unproven SMR designs at this stage further aligns with their strengths.

Cameco shares have posted gains of roughly 24% over the past year as the nuclear investment case gained traction. Near-term trading has been more mixed, with some pullbacks coinciding with the momentum trade that nuclear has trended with over the past couple years.

Tyler Durden Thu, 07/16/2026 - 14:45

The Six Vectors Of Gold Remonetization Revealed

Authored by Ronnie Stoeferle via VonGreyerz.gold,

A look at monetary history reveals that the question of “sound money” was never purely academic in nature but has always been of central importance for economic stability and social order. The past five decades of the pure fiat experiment are, measured against 5,000 years of monetary history, a brief anomaly. And anomalies tend to be corrected.

Our thesis of a remonetization of gold may seem bold at first glance, which makes a clear conceptual framework all the more important. Those waiting for the reintroduction of a classical gold standard will be disappointed: Governments have no incentive to voluntarily relinquish the fiscal and monetary flexibility that the fiat regime offers them. Rather, what is meant is a process in which gold regains monetary relevance. Not necessarily as money in the strict sense, but certainly as the ultimate reference asset for value, trust, and settlement.

This remonetization does not occur by decree, but through function; not through revolution, but through evolution; not a sudden fanfare, but a steadily rising crescendo. Paradigm shifts often creep in through customs, certainties, and economic necessities. Gold is not moving to the center of the system. Rather, driven by fiscal exhaustion, geopolitical fragmentation, and dwindling institutional trust, the system is moving toward gold.

What connects the following six vectors is a shared underlying structure: At each of these junctures, gold regains a key role as a store of value and a safe haven. Not all vectors will become reality simultaneously or in their entirety, but several parallel channels should suffice to sustainably strengthen gold’s monetary relevance. 

The six vectors Vector I: Reserve Function & Sovereignty

Ever since the freezing of Russian reserves in 2022, it has become clear to many market participants that fiat reserves carry not only market risk but also political risk. Gold is the only major reserve asset without issuer risk. Repatriations in Germany, Poland, the Netherlands, and most recently France underscore this trend.

Vector II: Private Remonetization

Not only governments but also institutions are rediscovering gold as a store of value. Pension funds, family offices, insurance companies, and sovereign wealth funds have often held only minimal gold allocations to date. Even small shifts away from the global bond market could trigger enormous demand. Gold is thus evolving from a tactical allocation to a strategic liquidity reserve, from a “satellite” to a “core” investment.

Vector III: Accounting & Recapitalization

Gold functions not only as a reserve but also as an accounting lever. Since 1999, the Eurosystem has regularly valued gold at market prices; the resulting revaluation reserves effectively act as equity. In the US, too, the debate over revaluing gold reserves is gaining traction. In highly indebted countries, gold can thus become an instrument of silent recapitalization.

Vector IV: Anchoring Through Gold-Backed Bonds

Gold-backed government bonds could strengthen confidence and lower financing costs. Proposals such as those by Judy Shelton show that what is at stake is not a new gold standard, but a credibility standard. The difference between an unsecured government bond and a gold-backed one is similar to that between a promise and a pledge.

Vector V: Western Central Banks as Buyers

The major gold buyers in recent years have come primarily from emerging markets. The next phase could begin if Western central banks with low gold holdings—such as Canada, Japan, Australia, or the United Kingdom—replenish their gold reserves. Even moderate target reserves would generate demand equivalent to one year’s worth of mine production.

Vector VI: Digitalization

Tokenization could solve gold’s historical transaction problem. Gold-backed tokens combine physical scarcity with digital transferability. This positions gold as a competitor to fiat payment systems and CBDCs. The key factor remains whether ownership rights, backing, verifiability, and insolvency resilience are robustly structured.

The vectors described do not operate in isolation. A rising gold price improves central bank balance sheets, facilitates policy reassessments, strengthens the appeal of gold-backed bonds, and increases interest in tokenized forms of gold. It is precisely these feedback loops that make remonetization not a single event, but a self-reinforcing process.

Remonetization is taking shape

We are by no means the only analysts pointing to the possible evolution of the monetary system. Zoltan Pozsar had already elevated the debate on a new world monetary order to a new level in 2022 with his article “Bretton Woods III,” against the backdrop of sanctions on Russian currency reserves. He concluded his remarks with the following forecast: “From the Bretton Woods era backed by gold bullion, to Bretton Woods II backed by inside money (Treasuries with unhedgeable confiscation risks), to Bretton Woods III backed by outside money (gold bullion and other commodities).”

There is no question in our minds that we are irrevocably on a journey toward a new global (monetary) order. It will require an internationally recognized anchor of confidence. For several reasons, gold appears to be predestined for this role:

• Gold is neutral – it knows neither flag nor ideology and is thus free from geopolitical manipulation.

• Gold has no counterparty risk – unlike any claim or digital account entry, it exists independently, without relying on the promise of a third party.

• Gold is liquid – with a daily trading volume of around USD 330bn, it ranks among the world’s most liquid assets.

• Gold cannot be multiplied at will – gold reserves have been growing steadily by around 1.8% per year for decades. This geologically determined supply discipline is the fundamental difference from any fiat currency.

The composition of global currency reserves shows how far remonetization has already progressed. For decades, US Treasury bonds formed the backbone of official portfolios. Since the global financial crisis, the trend has reversed: The share of US bonds held by foreign central banks is declining, while gold is gaining significantly again. Despite significant purchases, emerging markets still hold considerably less gold than Western institutions.

What Connects the Six Vectors: Feedback Loops

As different as these six vectors may seem, they share a common underlying structure. In every case, gold regains monetary significance precisely where the existing system relies on trust, the quality of collateral, or political neutrality. Gold is not becoming more relevant because it has been modernized. It is becoming more relevant because the weaknesses of the alternatives are becoming apparent.

Feedback instead of addition

The key point is that the vectors do not act in isolation but reinforce one another. The cycle reads like a self-reinforcing engine:

• Accumulation (Vector V) and private demand (Vector II) drive the gold price.

• A rising gold price improves central banks’ balance sheets (Vector III).

• Improved balance sheets reduce political resistance to gold-backed bonds (Vector IV).

• Gold-backed bonds legitimize gold as a reserve asset (Vector I).

• A higher, legitimized gold price makes tokenized gold products more attractive (Vector VI).

• Tokenization, in turn, increases demand – and closes the loop.

This positive feedback loop is the actual catalyst. Once a critical mass is reached, the process accelerates on its own. Remonetization is thus not a binary event but a gradual phase transition. It can begin with reserves, gain traction through private portfolios, become politically relevant through balance sheet logic, and open up new areas of application through technological innovations. Those waiting for one big bang will overlook the crucial point: Systemic turning points are not heralded by decrees but by changing practices.

An Overview of the Vectors

 

Arguments against the concept – and why we remain convinced

 

However, there are also factors that argue against the remonetization of gold. The following structural objections deserve serious consideration:

• The cash flow argument: Gold generates no current income. As long as government bonds are considered risk-free, the institutional incentive remains limited. Counterargument: It is precisely this status that is eroding – see Vector III.

• The systemic risk argument: An erratic rise in the price of gold would destabilize the debt-based monetary system. Political resistance to this stems not from a conspiracy but from rational politics of interest. Counterargument: An orderly process like the Eurosystem model is in any case more attractive to policymakers than market chaos – the question is not if uncontrolled, but when controlled.

• The substitution argument: Gold could lose its collateral function to other assets, such as Bitcoin or tokenized commodities. Counterargument: Complementarity is more likely than substitution (see the Bitcoin discussion in Vector III).

What would have to happen for the remonetization thesis to fail? Three scenarios are conceivable:

• Significant debt reduction through real economic growth or fiscal consolidation

• Substantial geopolitical détente with the lifting of all sanctions and a return to multilateral cooperation

• A technological breakthrough in CBDCs that renders gold obsolete as an anchor of trust

Each of these scenarios is possible on its own. However, it is extremely unlikely that they would occur in combination. Remonetization would fail only if several secular trends were to reverse simultaneously.

The burden of proof has shifted

The real flaw in the current debate lies in what is considered normal. Over half a century of fiat regimes has clouded historical memory: The unbacked paper money system is now regarded as the norm, while gold is seen as a relic. Historically speaking, it is exactly the opposite. The past 54 years are the anomaly, and 5,000 years of monetary history are the proper frame of reference.

The burden of proof, therefore, does not lie with those who consider a gradual remonetization plausible. It lies with those who claim that a historically unique fiat regime will be able to function permanently without resorting to monetary anchors.

Back to the monetary future – this is also the title of the 20th-anniversary edition of the In Gold We Trust report 2026. It is not a nostalgic throwback. It is the sober realization that the history of money is longer and more cyclical than a single political cycle. Gold is not returning because it romanticizes the present. It is returning because the present can no longer keep its promises.

The shadow gold price

Should gold return to the center of the monetary system, the question of price consequences inevitably arises. An exact valuation is, by nature, impossible, but analytical approximations at least give us an idea of possible orders of magnitude. The best-known concept is the so-called shadow gold price.

The shadow gold price refers to the theoretical gold price at which the base money supply would be fully backed by gold. In other words: The shadow gold price is the price level at which a return to a fully backed gold currency would be mathematically possible. We do not consider such 100% backing of M0, as is sometimes advocated, to be necessary; it would currently imply a gold price of USD 20,900 per ounce. During the era of the gold standard, the market forced central banks to maintain coverage ratios between one-third and one-half, which corresponds to a current gold price between USD 7,000 and USD 10,400 per ounce.

Let’s take it a step further and look at the global level. The international shadow gold price corresponds to the gold price that would result if the central bank gold reserves were to cover the money supplies of the leading currency areas – the US, the euro area, the UK, Switzerland, Japan, and China – weighted by their share of GDP. The result reveals the extent of monetary expansion: With 100% coverage of the broad money supply M2, the gold price would be just under USD 250,000; even at a moderate 25%, it would be over USD 60,000.

Tyler Durden Thu, 07/16/2026 - 14:30

NYC Council Grapples With Debate Over Bill To Ban Horse-Drawn Carriages

Authored by Nicholas Zifcak via The Epoch Times,

The family of Romanch Mahajan delivered emotional testimony over video link and in person on July 15, during a New York City Council hearing about a law that would phase out carriage horse rides in Central Park.

Tearful aunts and uncles of the deceased 18-year-old urged city council to outlaw the horse-drawn carriage rides and spare other families the grief they are still struggling to cope with.

The law, renamed in honor of the teen from India who died on June 17, would stop the city from issuing new licenses and over two years phase out the horse-drawn carriage rides through Central Park by June 1, 2028.

Majahan was thrown from a carriage after the horse spooked and bolted during a ride with his family on June 17 during their visit to New York. At the time the carriage driver had stepped down to take a photo of the Mahajan family in the carriage. City law requires carriage drivers to hold the reins of horses at all times.

Testimony from the family was followed by city officials, animal rights activists, and the union representing carriage drivers, TWU Local 100.

On Tuesday, New York City Council Speaker Julie Menin announced her support for the bill in a video on X, calling the teen’s death “heartbreaking and infuriating,” and preventable. She said it’s time “to begin the transition away from horse-drawn carriages. “

Multiple past attempts to end the horse-drawn carriage rides in Central Park have failed. The previous bill, Ryder’s law, introduced in 2022, was blocked by then-Speaker Adrienne Adams, according to former council member Bob Holden, who introduced the bill and attended Wednesday’s hearing to testify.

City Council members focused on how to help the 208 drivers navigate a career change and how to make sure horses are not sold for meat or end up pulling a carriage somewhere else.

Dr. Gabriel Cook, a veterinarian who was hired by carriage owners to look after the health of their horses, said the bill would be a death sentence for the horses. He said many horse retirement sanctuary facilities struggle financially and are not necessarily a better environment for the horses than their current stables.

Council Member James Gennaro of Queens berated city officials for lax enforcement of city law, demanding to know how many carriage medallions were revoked or suspended for violations in recent years.

“What have you done to enforce?” asked Gennaro when questioning Carlos Ortiz, the deputy commissioner at the city’s Department of Consumer and Worker Protection. Ortiz said there have been suspensions but could not provide exact numbers.

Gennaro favors reforming the industry and introduced a bill on June 11 that would require the city to study ways to improve safety for horses by such improvements as allowing pitching posts in the park to tie horses up and allowing them to start working at 7 a.m., when temperatures are cooler.

Ashley Byrne of People for the Ethical Treatment of Animals (PETA), echoed Gennaro’s argument of “little to no enforcement from the city,” leading to the injury and death of a long list of horses over the past several decades.

Gennaro challenged Byrne in a heated exchange about what PETA has done for horses after the death in June of carriage horse Deniz, which TWU Local 100 has said died from eating poisonous Japanese yew that the Central Park Conservancy had planted within reach of the carriage route. Gennaro said he organized a campaign and reached out to the Conservancy.

“What have I done about a plant?” Byrne shot back at Gennaro as the audience jeered the council member. But Gennaro’s allotted time was up.

Speaking on the topic on July 14, Mayor Zohran Mamdani expressed concern that adequate assistance be provided to carriage drivers, who would be put out of work.

“We support the spirit of the bill,” Mamdani told reporters, speaking at an unrelated press conference on July 14 in Inwood, Manhattan.

He suggested that the council do more to make sure drivers and stable hands employed in the industry find new employment.

Tyler Durden Thu, 07/16/2026 - 13:45

Goldman Slashes Global PC Shipment Forecast As Memory Chip Crunch Derails Upgrade Cycle

The global PC market is facing mounting pressure as a worsening memory-chip crunch, limited product availability, and consumers balking at higher prices threaten to deepen the downturn. These headwinds prompted Goldman analysts to "further trim" their PC shipment forecasts for this year and next.

"We further trim our global PC shipment estimates for 2026-27E, considering the near-term pressures of higher memory and CPU costs, and the flattening replacement cycle following the end of Win 10," said Allen Chang, a managing director and head of Goldman's Greater China Technology research team.

Chang continued, "We now expect global PC shipments to be down -14%/ -5% YoY in 2026E/ 27E, followed by zero growth in 2028E (vs. -10%/ +3%/ +3% YoY previously). Our updated PC shipment forecasts are 255m/ 243m/ 244m in 2026-28E, respectively."

Global PC Shipments: -14%/ -5%/ 0% YoY in 2026-28E

Global PC Revenues: -5%/ -2%/ +3% YoY in 2026 / 27E

PC ASP: increasing pricing due to specification upgrades and rising BoM

Global PC shipments: consumer vs. commercial

Chang noted that AI PCs are expected to remain a top growth driver:

We expect global AI PC shipments to reach 150m / 199m in 2026E / 28E (+15% CAGR), vs. 150m / 219m in our previous forecast, indicating 59% / 82% penetration of the total PC shipments worldwide. We expect global AI PC revenues to be US$169bn / 221bn in 2026E/ 28E (+14% CAGR), vs. US$169bn/ $226bn previously. We are positive on AI PC penetration ramp up in 2026E, with continuous introduction of new AI applications, such as OpenClaw and Seedance by Bytedance.

We expect global Gaming PC shipment to reach 26m / 28m in 2026E / 28E (+4% CAGR, vs. -2% CAGR for overall PC shipments), indicating 10% / 12% penetration of the total PC shipments worldwide. We expect global Gaming PC revenues to be US$46bn / $52bn in 2026E/ 28E (+7% CAGR, vs. +1% CAGR for overall PC revenues), riding on customers' rising specialized needs for PCs. We model global Gaming PC ASP to increase, driven by specification upgrades (report link), including graphic card platform upgrades, thinner design, AI features, silent mode, and long durability, which would bring better user experience when enjoying triple-A games.

Professional subscribers can read a lot more on tech trends here at our new Marketdesk.ai portal.

Tyler Durden Thu, 07/16/2026 - 13:25

Deflationary Money Hits Different: Losing Half Its Price And Winning Anyway

Authored by Bryan Lutz, Contributor at The Sovereign Capitalist:

The FUD is back, baby.

Bitcoin is down nearly half from its 2025 high. And now, the obituaries are out of cold storage and back in heavy rotation. Sentiment surveys are scraping levels we haven’t seen since the 2022 crypto-winter, and the financial press has rediscovered its favorite genre: the Bitcoin post-mortem.

And this time they’ve got a chart to wave around. The Dow just had its best year against Bitcoin since 2022 – the Dow/BTC ratio has more than doubled off its August 2025 low, from 0.36 to 0.84.

Here it is. We’ll even draw the red line for them:

The Dow’s twelve-month winning streak against Bitcoin. Note what the line still hasn’t touched: 1.0.

Anyone holding through it felt every point. If you wanted to write the “Bitcoin is finished (again)” piece, this is the chart you’d lead with.

Notice what the line still hasn’t done, though.

It hasn’t touched 1.0.

After the worst sentiment stretch in years, after a ~45% drawdown, after twelve months of losing to the most boomer-coded stock index on earth, the entire Dow Jones Industrial Average still cannot buy one Bitcoin.

Against thirty of America’s biggest companies, the coin wins, with change left over.

Flip the fraction.

If that seems impossible, it’s because you’re reading the fraction the way CNBC wants you to read it:

Bitcoin

───────

$$$$$$$

Bitcoin as the numerator, dollars as the denominator, and the numerator just got cut in half. Case closed, right?

Wrong fraction. As Mark Jeftovic laid out in It’s the denominator, stupid, the entire point of Bitcoin is that it isn’t the thing being measured. It’s the thing you measure with. Put the index where it belongs:

  DOW

───────

BITCOIN

Now extend the chart back a decade and hit the log button, which is a one-click jailbreak for fiat-denominated brains:

The Dow, denominated in Bitcoin. A 99% decline that survived every Bitcoin crash along the way, including this one.

In 2014 it took more than 40 Bitcoin to buy the Dow. At the 2015 extreme, 84.

Today: 0.83.

Measured in the new denominator, the Dow has lost roughly 99% of its value in twelve years, and the “comeback” everyone is celebrating shows up on that chart as a wiggle at the bottom of a cliff. Bitcoin just took its worst beating in years and gave back approximately none of a decade of relative gains.

That’s what deflationary money does. It hits different.

It’s about the maths

The Dow is priced in dollars, and dollars multiply, inflate, depreciate, and then die… which is the business model for the whole fiat system. M2 only ever pauses on its way up, every crisis gets solved with more of it, and index earnings get marked up in the same shrinking units.

Bitcoin’s supply schedule, meanwhile, doesn’t attend FOMC meetings. The halvings keep halving. Twenty-one million, take it or leave it.

Run the numbers since January 2000: the Dow is up 361% in dollars. M2 is up 394%. Divide one by the other and the twenty-six-year bull market vanishes: measured in the money itself, the index has gone nowhere. Every point of “Dow 52,000” that isn’t printer output rounds to zero.

The Dow and the money supply, same starting line, 26 years later. The index never got ahead of the printer.

So, the fraction has a numerator inflated by an expanding money supply, sitting on top of a denominator that does not expand. Run that equation for a decade and the line on the chart is the only possible output. The drawdowns – 2018, 2022, this one – are volatility inside the trend. And that trend is division between fiat money and Bitcoin.

A Dow’s comeback measured in a shrinking yardstick must sprint just to stand still. This year, it’s rallied hard in dollars. In Bitcoin terms, it clawed back a rounding error.

Same story, slower clock.

If this framework sounds familiar, it should. Gold holders have been living it since 1971, just at a different tempo.

In 2001 the Dow cost 42 ounces of gold. Today, with the Dow at nominal record highs and the algos doing victory laps, it costs 12.7 ounces. Two-thirds of the index’s gold-denominated value, gone, during a quarter century of “stocks always go up”.

Yes, gold and Bitcoin diverged this cycle. Gold at $4,142 while Bitcoin sits in a drawdown. They have different volatility profiles, and different adoption curves. Yet, they share the same denominator maths. One asset is the incumbent hard money, the other is the challenger still crossing the chasm. The DOW index can’t outrun either of them over any window that matters.

“Stocks at record highs” is mostly the yardstick shrinking. It is always has been.

Deflationary Money Still Undefeated this Decade

Here’s the thing about extreme bearish sentiment: it’s a report on the emotional state of leveraged tourists, not on the asset. Nothing about Bitcoin(or gold) changed this year. The supply schedule didn’t change. The halvings didn’t change. The $300+ trillion in bonds denominated in a melting currency didn’t change, except to get bigger.

The only thing that changed is the price, quoted in the old denominator, and the old denominator’s entire job description is to go down.

So, the mainstream news cycle might be right about one thing:

Deflationary money doesn’t win every year.

However, it does win every decade, and it’s undefeated.

Tyler Durden Thu, 07/16/2026 - 13:05

House Defeats Bid To End Israel Aid While Senate Blocks US-Israel Intel Integration

The U.S. House on Wednesday rejected an amendment by Rep. Thomas Massie (R-Ky.) that would have eliminated $3.3 billion in annual U.S. military aid to Israel, voting 314–104 to defeat the proposal.

As Tom Gantert reports for The Epoch Times, the vote exposed divisions within the Democratic Party, with 103 Democrats joining Massie in support of the amendment, while 98 Democrats voted against it and 10 voted present. Massie was the only Republican to vote in favor of the amendment.

“Though my amendment to strike $3.3 billion in aid to Israel from the State Dept Approps bill did not pass, 104 House Members voted in favor of it,” Massie said on X.

“The tide is changing. Americans want their tax dollars to be spent improving things here at home, not waging war and genocide.”

The amendment was considered as the House debated the fiscal 2027 State, Foreign Operations and Related Programs appropriations bill.

Before the vote, House Minority Leader Hakeem Jeffries (D-N.Y.) urged lawmakers to reject the amendment, calling it “overly broad” because he said it could restrict funding for humanitarian aid, refugee resettlement, peace-building efforts, and U.S. Embassy operations.

While criticizing Israeli Prime Minister Benjamin Netanyahu’s government and calling for a “major reset” in U.S. policy toward Israel, Jeffries said the amendment was not the appropriate way to achieve those goals.

“In addition, the so-called Massie amendment would restrict our country’s ability to confront Hamas, Hezbollah, and other terrorist organizations in the region who are sworn enemies of both the United States and Israel,” Jeffries’s letter to his colleagues stated.

Rep. Randy Fine (R-Fla.) made reference to Massie, who lost his primary election to a President Donald Trump-backed candidate in May.

“Very proud of my @HouseGOP colleagues,” Fine posted on X after the vote.

“Today we unanimously repudiated our soon-departing Jew-hating colleague, making clear that standing with our greatest ally is core to America’s interests.”

Fine continued, “It takes a lot of effort to eradicate the green shoots of Jew Hatred that want to infect our party the way they have Democrats. Folks in Washington are learning I won’t allow it.”

Netanyahu said he wants Israel to phase out its reliance on U.S. military aid over the next decade, saying the country has grown strong enough economically and militarily to become more self-sufficient.

Israel currently receives about $3.8 billion annually under a 10-year, $38 billion U.S. assistance agreement that expires in 2028. Netanyahu said ending the financial component of military assistance would reflect Israel’s increasing independence while preserving a close strategic partnership with the United States.

At the same time, Democrats in the US Senate have blocked debate on an annual defense policy bill, objecting not only to President Trump’s war on Iran but also to provisions that would more closely integrate the United States and Israeli militaries.

The motion to proceed failed 50-46, well short of the 60 needed, with votes on strict party lines, and Thune flipping to "no" procedurally to preserve a revote

The NDAA process is where the integration fight lives: Massie is fighting the House version's Section 219, which he says would begin "co-mingling our military supply chains and technology with Israel's"

Reuters reports that the version of the Bill before the Senate has also triggered backlash over measures that would deepen US military and intelligence ties with Israel.

One key provision would require the Pentagon to appoint an official to coordinate between the US and Israel on defence technology.

That would include joint weapons research, production and the integration of each country’s technologies into the other’s military systems.

The provision also controversially calls for “data fusion”, which Human Rights Watch defined in June as combining feeds from multiple sensors and intelligence sources into a single targeting picture.

The group said the arrangement could see the US absorb Israeli intelligence that may have been collected through what it described as problematic mass surveillance programmes.

A separate measure in the 2027 Intelligence Authorization Act, which is usually considered alongside the NDAA, would expand intelligence sharing with Israel.

Democrats framed the block around the war: Schumer said Republicans want the NDAA passed "as though none of this is happening," and Murphy called it flatly "an authorization for the Iran war, a war that nobody in this country wants."

Senate Democrats’ efforts reflect a broader shift within the Democratic Party, where support for Israel has cratered ahead of the November midterm elections. Israel’s favourability rating among Democrats dropped from 59 percent in 2018 to 22 percent in May, according to a June Reuters/Ipsos poll.

Tyler Durden Thu, 07/16/2026 - 12:45

Headwinds And Tailwinds: Minding The Market Weather

Authored by Michael Lebowitz via RealInvestmentAdvice.com,

A sailor who fixates on the barometer will rarely leave port. A sailor who never checks it will eventually get caught in a storm. It’s easy for most investors to fall into one of those two modes, either warning that headwinds are approaching and taking cover, or waving off every warning because AI spending is carrying the market higher.

This article walks through several market headwinds that warrant attention, as well as a tailwind that may be large enough to keep the boat moving forward. Appreciating the headwinds and tailwinds in more detail will help you better monitor the market barometer, allowing you to assess and adjust risk levels with more awareness going forward.

Storm Forecasting

Market forecasting has more in common with hurricane forecasting than most investors appreciate. The goal when managing an investment portfolio is not to predict a single outcome but to understand the environment well enough to establish a range of possible outcomes.

When a hurricane is brewing, meteorologists don’t draw a single storm track forecast on the map; they draw a “cone of uncertainty” that contains dozens of possible paths. Over time, as more information is gathered, the cone tightens.

Some storms cause immense damage, while others prove much weaker than expected. Other once-threatening storms never reach land and peter away in the ocean. Which path materializes depends on many variables layered on top of each other.  Like markets, it’s a dynamic process that is impossible to predict with certainty.

Investors face the same task as meteorologists. We must gauge the many forces acting on markets simultaneously and consider a slew of others that may or may not pressure markets in the future. Doing so efficiently provides us with a range of outcomes rather than relying on a single forecast.

With many headwinds arising, the job for investors right now is to closely track the environment and be ready to trim their sails if needed.

The Headwinds Worth Watching Global Liquidity

Liquidity is the lifeline of markets. To wit, Stanley Druckenmiller once stated: 

“It’s liquidity that moves markets”

With the recent surge in the use of derivatives, options, margin debt, and other forms of leverage, changes in liquidity conditions are even more important than ever in shaping market expectations.  

Michael Howell’s Global Liquidity Index (GLI) uses factors such as central bank balance sheets, cross-border bank lending, shadow banking, repo markets, and collateral availability to assess how liquidity is likely to change. In a recent Commentary, in which we elaborate on his work and his current view, we stated:

The cycle is now pointing down into 2027. Howell projects $40 trillion in global debt rollovers by 2027, a $4 trillion increase from the previous year.  That borrowing demand comes as liquidity contracts, creating a mismatch between refinancing demand and tightening financial conditions.

The graph below charts Howell’s GLI alongside a 65-month sine wave that has been a good predictor of liquidity peaks and troughs. Howell’s index and the sine wave show the liquidity cycle peaked in mid-2025 and has been declining since, with the next trough not expected until 2027. Historically, the declining phase of this cycle has favored cash, long-duration government bonds, and gold over risk assets, precisely because a shrinking pool of global liquidity makes markets more dependent on cash flow and less prone to speculative excess.

Treasury Issuance

In a similar vein, the federal deficit continues to demand liquidity to fund the rapidly growing issuance of Treasury debt. That supply of debt has to be absorbed by someone. Heavier net debt issuance competes with demand for all other investments. On the demand side, with no QE and domestic banks constrained by regulation, there is less ability to absorb the new supply than in years past.  

Bear in mind, however, that if there is a stimulus package or even increased government spending to boost support for Republicans in the midterm elections, this headwind can also be a tailwind.

Restrictive Fed Policy

Even with the last cycle of rate cuts, real policy rates, as shown below, remain above levels most economists would consider neutral. Such a restrictive policy works with a lag, and the economy has so far absorbed it well. That does not mean the lagged effects are gone.

Furthermore, the Fed’s hawkish tone and the potential for rate increases could make financial conditions even more restrictive.

The Yield Curve And Volatile Equity Rotations

We recently wrote, Are Flattening Yield Curves and Style Rotations Deceptive Omens, to help readers differentiate between monitoring financial conditions and timing market tops.

The article explains why a bear flattening of the yield curve and instability in leadership between growth and value stocks, as we are witnessing now, are both symptoms of the repricing of growth expectations and the discount rate. The lesson from that piece is that these signals describe a changing environment but do not tell you when or whether a market or economic downturn might occur.    

The last two sentences of the article sum up this headwind well:

The signals suggest the regime may be changing, and we should be prepared for that possibility. However, until that becomes more evident, we must take advantage of what the market has to offer. 

Low VIX – High Implied Correlation

Our daily Commentary from July 9, 2026, points out a wide and unusual divergence between the low S&P 500 volatility index (VIX) and the lack of correlation among the index’s individual stocks. 

As we share below, the condition represents a potential headwind, but for now, just something to be mindful of.

The low VIX (first graph) implies smooth sailing ahead, while a record-low implied correlation (second graph) suggests the market could be at risk. Goldman is hedging the risk of a correction, i.e., an implied correlation spike. Often, when implied correlation rises sharply from extreme lows, as it did in August 2024 during the yen carry trade unwind, the divergences that kept the index calm disappear. Stocks start moving together again, and most of the time they move down. This condition is not a warning to expect a market downdraft, but it does suggest that risk awareness is critical.  

Midterm Elections

Markets tend to dislike uncertainty. Accordingly, the months leading up to the midterm elections often bring volatility. This year, the potential for the Democrats to regain the House and, less likely, to take the Senate as well poses greater risks than if the Republicans were expected to maintain control of both houses.

We suspect that toward later summer and early fall, market trepidation will increase over the unknown election outcomes and what they may mean for policies and ultimately markets. Accordingly, this is likely a stock market headwind that will intensify as the year progresses.

Consumer Struggles

After two strong months of outsized growth, consumer credit, mainly credit cards, contracted for the first time in almost two years. The personal savings rate sits at 3.0%, near its lowest level since 1960. Both sets of data indicate that consumers’ wage growth is no longer keeping pace with inflation, forcing them to reduce borrowing and/or draw down savings and run tighter budgets.

This is a genuine headwind, and it isn’t going away soon. But it’s not the whole consumer story either. Unemployment remains low, and the struggle appears concentrated among lower-income individuals and parts of the middle class. Many indications of spending among upper-income households point to continued strength, and that cohort accounts for an outsized share of total consumption. Per Yahoo Finance:

A new report from Moody’s Analytics shows the top 10% of earners now account for nearly half of all U.S. consumer spending, a historic high that shows how dependent economic growth has become on wealthy households.

A squeezed lower class matters for retailers and lenders exposed to that segment, but less for the broader market, where spending is increasingly a story about who still has room to spend.

This is a headwind worth watching more closely if the unemployment rate starts to rise and financial struggles spread to higher-income earners.

Tailwinds That Could Become Headwinds Margin Debt

Record levels of margin debt have boosted demand for stocks, providing a strong tailwind for the market. As we wrote in Margin Debt Risk;

Margin debt just set another record. In May 2026, investors owed their brokers a combined $1.42 trillion, the highest in history and a 53.7% jump from the prior year.

While record and growing margin debt is a powerful tailwind, it’s a wind that can reverse direction suddenly. Per the article:

Leverage peaks near tops. Then it mean-reverts violently because the unwind forces the selling.

In addition to watching margin debt, pay attention to the most favored stocks. Today, semiconductor stocks are bolstered by a disproportionate share of the margin. If they start faltering while the broader markets hold up, this may be a sign that margin usage is about to reverse. Further, any indication of liquidity trouble in the money markets could also result in a decline in margin debt.

The Yen Carry Trade

The yen carry trade is a source of leverage pushing the market higher. As we wrote in a recent Commentary:

The carry trade thrives with a weak yen, as we have today.  Despite higher Japanese borrowing costs, the yen has depreciated significantly against the dollar, more than offsetting the higher interest costs for carry trades. A weakening yen means the trade remains profitable, and the leverage the carry trade provides to markets continues to build.

The risk today to US investors is that higher Japanese yields and a stronger yen could force a rapid, disorderly reversal of the carry trade.  Bear in mind that the more the yen falls, the more the trade grows, and the larger the unwind will be whenever the BOJ finally acts.

The Tailwind: AI Capital Spending

Working against every headwind we discussed, and others, is a single counterweight of extraordinary size: the capital spending boom tied to artificial intelligence infrastructure.

The four largest hyperscalers (Amazon, Microsoft, Alphabet, and Meta) are on pace to spend roughly $725 billion combined on capital expenditures in 2026, up about 75% from last year.  Goldman Sachs has raised its cumulative capex estimate for these four companies from 2025 through 2030 to $5.3 trillion, up from $4.5 trillion prior to first-quarter earnings.

That spending shows up directly in corporate earnings, employment in construction and semiconductors, and demand for everything from GPUs to transformers to turbines. The spending is also self-reinforcing in the near term. For instance, cloud backlogs at companies are growing, giving management the revenue predictability needed to justify increased spending. Although there is considerable skepticism about the durability of this spending cycle, it has thus far yielded results that suggest otherwise.

This is the tailwind doing the heavy lifting in the economy and market. It has been large enough and persistent enough to absorb concern about the headwinds. The question worth asking is not whether the tailwind is real but how much further it can carry markets before the headwinds start to matter more than the continued spending.

Summary: Take Advantage Or Trim Your Sails?

In meteorological speak, the Cone of Uncertainty is wide. However, just because the headwinds are numerous and the range of potential outcomes is vast, investors don’t need to trim their sails and batten down the hatches.

The more productive approach is to keep using the favorable winds while they are blowing, and to pay close attention to market barometers and remain prepared for a shift in the winds. That means participating in the areas of the market most directly tied to the AI capital spending cycle while it remains intact, while also paying attention to balance sheet quality, maintaining valuation discipline, closely monitoring technical conditions, and remaining diversified in other sectors less impacted by the AI spending boom.

Tyler Durden Thu, 07/16/2026 - 12:25

Global Investments In Nuclear Fusion Surge 69% To $4.5B

Authored by Alex Kimani via OilPrice.com,

• Private investment in nuclear fusion reached a record $4.48 billion in 2025.

• Most fusion firms are targeting commercialization in the 2030s.

• Major tech companies are backing fusion developers, with Microsoft signing a binding power purchase agreement with Helion, while Google, Nvidia, and other investors are funding companies such as Commonwealth Fusion Systems and Proxima Fusion.

Global private investments in nuclear fusion hit a record $4.48 billion in 2025, in large part driven by the booming energy demands of AI data centers and rising global energy security concerns.

According to the Fusion Industry Association (FIA), confidence in the viability of nuclear fusion technology is growing, with ~71% of fusion companies now expected to deliver commercial power to the grid by the 2030s.

And that confidence is now translating into tangible dollars and infrastructure with fusion companies now inking site selection and Power Purchase Agreements (PPAs) with major tech companies.  

To wit, three years ago, Helion Energy signed a first-of-its-kind power purchase agreement with Microsoft Corp. (NASDAQ:MSFT), with Helion committing to supplying Microsoft with at least 50 megawatts of electricity from a commercial fusion plant by 2028. Unlike a loose letter of intent, this is a binding corporate PPA, with Helion facing potential financial penalties from Microsoft and its transmission partner Constellation Energy (NASDAQ:CEG) if it fails to deliver on schedule. Constellation Energy serves as the primary power marketer, managing transmission from the reactor straight to the grid.

Last year, Helion broke ground on its first commercial-scale power facility dubbed Orion in Malaga, Washington. The Malaga site was strategically selected near the Columbia River to hook directly into Washington's main power delivery network, landing just upstream to power Microsoft’s massive cloud infrastructure. 

Helion is heavily backed by OpenAI CEO Sam Altman, who has injected hundreds of millions of dollars of his personal capital into the company. To keep pace with the strict 2028 Microsoft deadline, last year, Helion closed a $465 million Series G funding round led by Thrive Capital. The capital injection elevated Helion’s valuation to $15.5 billion, moving it from a speculative science venture into a heavily capitalized utility competitor.

In August 2025, Massachusetts Institute of Technology (MIT) spinoff, Commonwealth Fusion Systems, raised $863 million in a Series B2 funding, with the oversubscribed round bringing its total funding to nearly $3 billion. Some of CFS’ High-profile backers included tech heavyweights and PE firms such as Nvidia Corp. (NASDAQ:NVDA), Google (NASDAQ:GOOG) and Planet First Partners, as well as tech billionaires Bill Gates (Breakthrough Energy Ventures), George Soros's Counterpoint Global and Stanley Druckenmiller. CFS will utilize the funds to develop its proprietary fusion device SPARC, a compact, tokamak device that aims to generate net-positive fusion energy by 2027. Unlike Helion’s Orion, SPARC is a 170,000-square-foot research and demonstration facility designed to prove that commercial fusion is scientifically and practically viable. By using HTS magnets developed in collaboration with MIT, SPARC can be built at a fraction of the size and cost of traditional fusion machines. The facility's subsystems, including cryoplants and magnet power systems, are currently being installed and commissioned 

That said, CFS is also designing ARC, which could be the world's first grid-scale commercial fusion power plant. Located in Virginia, ARC is expected to generate about 400 MW of zero-carbon power--enough electricity for roughly 150,000 homes. Construction is slated to begin after permitting, with the reactor scheduled to start generating power for the electrical grid in the early 2030s.

Meanwhile, Munich-based deep-tech company Proxima Fusion recently raised €411 million, boosting its valuation to €2.4 billion and making it the best-funded and most valuable fusion company in Europe. Tech giant Google and German utility provider RWE signed on as critical industrial partners, each contributing €25 million. Proxima also received plenty of institutional support, with KfW Capital, Germany's deep-tech agency SPRIND, Burda Principal Investments, and the European Innovation Council (EIC) Fund joining alongside existing early backers like Plural and UVC Partners.

As the first spin-off from the prestigious Max Planck Institute for Plasma Physics (IPP), Proxima Fusion builds on decades of scientific breakthroughs from Germany's Wendelstein-7-X program. The funds will help accelerate the vertical integration of Proxima and the construction of "Alpha," a net-energy fusion demonstrator targeted for the early 2030s near Munich. The company is building commercial power plants based on the Quasi-isodynamic (QI) stellarator concept, a major physics breakthrough derived from the Max Planck Institute's Wendelstein 7-X programme.

Unlike most commercial fusion competitors that use a donut-shaped "Tokamak" reactor architecture, Proxima is developing stellarators. While more challenging to design than tokamaks, stellarators use a complex, twisted magnetic cage layout that prevents plasma disruptions, allowing the plant to run continuously rather than in short pulses. This makes the stellarator design highly stable and structurally ideal for providing steady-state electricity to industrial power grids.

Tyler Durden Thu, 07/16/2026 - 11:45

"Fatal Cancer On Civilization": Trump's War On Marxism Enters Action Phase As Rubio, Miller And Bessent Address 65 Nations

Summary: 

• Bessent Describes Action Phase Against Marxist NGOs Underway & Foreign Subversion Networks
• Rubio, Miller, Bessent Address Rise Of Far-Left Terrorism To Delegations From 65 Countries 
• Trump Team Declares War On Radical Left Groups 

Rubio, Miller, Bessent Address Delegations From 65 Countries On Far-Left Terrorism

Secretary of State Marco Rubio, White House Deputy Chief of Staff Stephen Miller and Treasury Secretary Scott Bessent addressed delegations from more than 65 countries on the alarming rise of far-left terrorism.

The broader message from all three speakers was very clear: Just as the US and its allies confronted the spread of Marxism in previous generations, Washington now believes the West needs an all-of-government, multinational strategy to counter far-left political violence, foreign influence networks and subversion movements seeking to destabilize Western institutions.

Rubio called for the civilized world to unite against an "encroaching darkness," urging all leaders in the room to defend what they have built and fight back against those who seek to destroy it. The enemy Rubio is referring to is the rise of transnational far-left terrorism. 

NEW: Secretary of State Marco Rubio calls for the civilized world to unite against an "encroaching darkness," urging nations to defend what they have built and fight back against those who seek to destroy it.

"It is easy to destroy great things. It is far more difficult to make… pic.twitter.com/G14GjBSIXE

— Fox News (@FoxNews) July 16, 2026

Rubio said, "In the United States, the share of left-wing terrorist attacks and plots has risen to levels not seen in DECADES. In Germany, far-left violence has jumped by more than 40% in just the last year alone."

🚨 JUST IN: Marco Rubio is throwing Democrats into a frenzy by dropping this truth nuke that terrorism is COMING FROM THE LEFT

"In all-out assault on our immigration officers, sniper attacks, explosives, armed ambushes, a transgender shooter opening fire on Catholic elementary… pic.twitter.com/jENXMAqe1U

— Eric Daugherty (@EricLDaugh) July 16, 2026

Rubio added that Antifa is being directly aided by Iran and Cuba through a massive international network that seeks to attack the West with terrorism and propaganda.

Marco Rubio says Antifa is being directly aided by Iran and Cuba through a massive international network that seeks to attack the West with terrorism and propaganda.

"They despise the West because the West is great." pic.twitter.com/20o7JSLdKY

— Shadow of Ezra (@ShadowofEzra) July 16, 2026

After Rubio, Miller addressed the hundreds of high-level officials in the room, saying, "Here in the United States, we have taken the necessary and essential action formally recognizing left-wing violence as a form of political terrorism that is a direct threat to our national security and the survival of our republican form of government."

Stephen Miller: "Here in the United States, we have taken the necessary and essential action formally recognizing left-wing violence as a form of political terrorism that is a direct threat to our national security and the survival of our republican form of government." pic.twitter.com/MMvYho2t87

— Breaking911 (@Breaking911) July 16, 2026

He called left-wing political violence: "This is a fatal cancer to civilization… The greatest risk that we have is that our institutions have grown too soft and too cowardly to be able to defend themselves against a mortal threat."

Stephen Miller on left-wing political violence: “This is a fatal cancer to civilization… The greatest risk that we have is that our institutions have grown too soft and too cowardly to be able to defend themselves against a mortal threat.” pic.twitter.com/RJCZDMAfCX

— Breaking911 (@Breaking911) July 16, 2026

Last but not least, Bessent then describes how the US Treasury will dismantle the foreign subversion networks that use nonprofits to wage war against the US:

Treasury is expanding its efforts to identify organizations that abuse charitable and nonprofit structures as vehicles for illicit finance.

We are examining where tax exempt status has been exploited, where charitable entities have become financial conduits for foreign influence activity and how those entrusted with stewardship of these organizations have instead enabled violence, where the evidence leads we will not hesitate to follow and of course we will hold these organizations, officers, directors, accountable and just as financial institution must know their clients they must know their grantees.

That work is well underway.

At President Trump’s direction, @USTreasury is bringing the full weight of our authorities to defend the integrity of the U.S. and global financial systems.

We will identify illicit funding, however artfully it is concealed. We will dismantle the networks that sustain political… pic.twitter.com/oS1ri4kZeX

— Treasury Secretary Scott Bessent (@SecScottBessent) July 16, 2026

All in all, the meeting should be viewed as a signal that the Trump administration has entered the action phase to dismantle the command-and-control structures of foreign subversion networks routed through Marxist groups and nonprofits seeking to destabilize the West. 

Watch Live: Rubio, Bessent Convene 65 Nations For Global Crackdown On "Far-Left Political Terrorism" 

Secretary of State Marco Rubio will host delegations from 65 countries in Washington on Thursday morning to coordinate a specialized international response to combat what the Trump administration describes as a "resurgence" of far-left political terrorism.

Watch Live here (due to start at 0910ET):

CNN cited a senior State Department official who said the delegations will come from "across the Western Hemisphere, Asia, Europe, and beyond."

The meeting will focus on countering the spread of far-left political violence and terrorism across the West, including riots, attacks on critical infrastructure and acts of industrial sabotage. 

Here's color from the outlet on today's meeting:

According to sources, many of the delegations will not be led by the foreign ministers of the countries, but rather more working-level and technical officials. Several cited scheduling, with invitations to the event only being issued at the beginning of July.

Countries that had worked with the administration on the topic were among those invited, the official said, noting they've had "very productive engagements with Germany, with Greece, with Italy, and that’s often where the problem is most pronounced in Europe."

Another State Department official told CNN that Rubio plans to describe left-wing terrorism as "the result of a unique evil rooted in a deep resentment towards civilization."

The threat of left-wing terrorism "has not really been addressed collectively in an effective way," the official said.

According to the official, partners have said they "have a handle" on other forms of political violence but "this one is more difficult for us."

We wrote one month ago: 

• Troubling Pattern Of Left-Wing Revolutionaries Targeting "Capitalists" Raises Alarm Over Youth Radicalization

We noted at the time, "While the cases appear separate, both point to a broader concern: revolutionary and radical-left rhetoric is increasingly bleeding into an alarming pattern of real-world violence, with younger and younger extremists resorting to violence targeting wealthy individuals or even right-leaning political figures."

Far-left extremist Hasan Piker calls on his followers to kill capitalists... 

Hasan Piker calls on his followers to kill capitalists:

“Yeah kill them! KiII those motherfuckers and murder those motherfuckers in the streets. Let the streets soak in their fucking red capitalist blood, dude.”

Democrats are campaigning with him. pic.twitter.com/YiZxGgRkgc

— Eyal Yakoby (@EYakoby) April 9, 2026

Treasury Secretary Scott Bessent and White House deputy chief of staff Stephen Miller are also expected to be at today's meeting. 

Bessent signaled in late May to reporters that "in the weeks and months" there will be a lot to talk about in terms of dark-money-funded NGOs fueling chaos and revolution in the US.

Ahead of today's meeting, a State Department official spoke with Breitbart News about foreign subversion networks sowing chaos in America:

"The State Department will be issuing a report detailing the Cuban regime's longstanding campaign to foment left-wing extremism in the United States and internationally. The report finds that for nearly seven decades, the Cuban regime has played an indispensable role in nearly every notable far-left insurgency, revolution, and militant movement across the Western Hemisphere and beyond."

ZeroHedge was first to point out in late 2025:

• "Is There a 'Cuba Connection' Behind the Radicalization of America's Nonprofit Left?"

Last week, Jim "Fergie" Chambers, the Communist centi-millionaire and heir to the massive Cox media fortune, was arrested in Spain at the request of the US Justice Department and is awaiting possible extradition on federal charges linked to "international money laundering… with the intent to provide material support to and resources to foreign terrorist organizations." 

City Journal's Stu Smith wrote in a recent report, "Chambers is one of the main funders of America's radical Left. His money has flowed to a host of projects in the "anti-imperialism" organizing space," adding, "Chambers claims that he and Singham are effectively the two primary financiers of the US radical left." Despite this, the two have apparently been at loggerheads—a conflict that has now gone public."

And all of this raises one obvious question: Why is the Democratic Socialists of America a "partner" of ICAP, a US-sanctioned, Castro-era Cuban organization created to export Marxist ideology and cultivate foreign political networks?

ICAP can be viewed as an ideological intake valve, providing political cover and access points that could be exploited for influence or intelligence operations.

That relationship provides new context for statements from DSA leaders, such as: "The most important thing we can do is take that American empire down from within."

You know it's bad for Democrats when one of their own has to write a WSJ op-ed, calling for "Lawmakers, law-enforcement agencies and journalists should investigate the DSA to see if it is being funded by foreign governments and interests."

Tyler Durden Thu, 07/16/2026 - 11:34

Senate Unanimously Votes That Sam Bankman-Fried Should Never Get A Pardon

Authored by Micah Zimmerman via BitcoinMagazine.com,

The Senate passed a resolution on Wednesday stating that Sam Bankman-Fried should “under no circumstances” receive executive clemency, a rebuke of the FTX founder’s request that President Donald Trump commute or pardon his sentence.

The measure, S. Res. 772, cleared by unanimous consent, a procedure that adopts a resolution when no senator objects. It expresses the sense of the Senate that Bankman-Fried should receive neither a pardon nor a commutation, and it affirms the chamber’s commitment to “the rule of law and integrity of the United States financial system.” 

The resolution is nonbinding and does not limit the president’s constitutional power to grant clemency.

Senators Cynthia Lummis, a Wyoming Republican, and Ruben Gallego, an Arizona Democrat, sponsored the measure. The two serve as the top Republican and top Democrat on the Senate Banking Committee’s digital assets subcommittee. They introduced the resolution on June 17, days after Bankman-Fried filed a formal pardon application with the Justice Department.

Lummis is the crypto industry’s most committed advocate in Congress and has spent years drafting the legislation the industry seeks. On this measure she has led the push to keep one of the industry’s most infamous figures in prison. “He had his day in court,” Lummis said when she and Gallego introduced the resolution. Gallego’s statement closed with four words: “Keep him locked up.”

The text of the resolution states that Bankman-Fried’s 25-year sentence “reflects the extraordinary scale and deliberateness of his crimes, his lack of remorse, and the catastrophic harm inflicted upon millions of victims.”

Bankman-Frieds’ attempts to get out of jail

Bankman-Fried, 34, filed his petition on June 8. His application seeks a “pardon after completion of sentence,” a form of clemency that would not erase his conviction but would restore civil rights such as voting and jury service and lift barriers to licensing, employment, and housing after he leaves prison. 

He is not eligible for release until around 2044.

Trump said in a January interview that he had no intention of pardoning Bankman-Fried. During his second term the president has granted clemency to other figures tied to crypto and to online markets, including Binance founder Changpeng Zhao and Silk Road creator Ross Ulbricht, along with other white-collar offenders.

A jury convicted Bankman-Fried in November 2023 on seven counts tied to the collapse of FTX, a case prosecutors described as one of the largest financial frauds in U.S. history. American customers lost more than $8 billion. A judge sentenced him to 25 years in prison in 2024.

Bankman-Fried ran two companies at the same time. FTX was a crypto exchange, which holds customer money the way a broker does and is not supposed to spend it. Alameda Research was a trading firm he owned. 

He moved billions of dollars in FTX customer deposits to Alameda, which used the money for trades, venture investments, political donations, and Bahamian real estate. FTX’s software exempted Alameda from the rules that would have forced it to cover its losses like any other trader.

The arrangement came apart once Alameda’s balance sheet was found and reported that much of what the firm counted as assets was FTT, a token FTX had created and could issue at will. The collateral behind Alameda was, in effect, an asset its sister company had invented. The exchange Binance said within days that it would sell its FTT holdings, and the price of the token dropped.

Customers moved to withdraw their deposits, and FTX could not return the money because it was no longer there. The exchange filed for bankruptcy on Nov. 11, 2022.

CoinDesk was the first to report on FTX’s dubious balance sheets.

Tyler Durden Thu, 07/16/2026 - 11:05

1 In 30 Koreans Margin-Called As Kospi Crashes, Regulator Suspends New Levered ETFs, Hikes Margins

For the first time in over three years, South Korea’s central bank raised its policy interest rate by 0.25% points to 2.75%, inline with expectations, and kicking off a monetary tightening cycle aimed at containing inflationary pressures spurred by the AI-driven semiconductor boom. It also helped spark a fresh rout in Korean stocks whose daily volatility has become borderline farcical with daily 5% swings having become the norm. 

The move on Thursday was the Bank of Korea’s first rate increase in more than three years as well as its first under Shin Hyun-song, a renowned international economist who took over leadership of the central bank in April.  Before Thursday’s move, the BoK had held rates at 2.5% since May 2025 at the conclusion of an easing cycle.

As the FT notes, Shin has stressed the need for tighter monetary policy in recent weeks, pointing to robust economic growth driven by a surge in demand for memory chips on the one hand and persistent weakness in the won, elevated inflation and growing financial imbalances on the other (these, are of course, connected, as the collapsing currency helps cheap chip exports, which raises core inflation for consumer electronics both domestically and globally).

“Korea is expected to see the effects of the semiconductor boom spill over into domestic demand. Therefore, underlying inflationary pressures are likely to be stronger and persist for longer than previously anticipated,” he told a press conference on Thursday. “We will respond until we are convinced that inflation stabilizes at our target level.”

Shin has said that the semiconductor export boom was feeding through to stronger household spending, wage growth and investment, increasing the risk that inflation would remain elevated for a considerable period. 

Indeed, as shown in the chart above, Korean consumer inflation is running well above the bank’s 2% rate, rising 3.2% in June from a year earlier, its fastest rate since December 2023. The country’s reliance on imported energy has also raised concerns as the conflict in the Middle East has roiled global energy markets.

The central bank also highlighted sizeable bonus payments at leading chipmakers Samsung Electronics and SK Hynix, which it said could contribute to broader wage gains and stronger consumer demand.

One reason for the hike was the relentless plunge in the won: despite South Korea’s record current account surplus, the won has remained under pressure, weakening 5% against the dollar year to date to its lowest level since the 2008 global financial crisis and ranking among Asia’s worst-performing currencies.

Analysts blame the currency’s weakness on exporters retaining overseas earnings for reinvestment and overseas equity purchases by Korean institutional and retail investors. The weaker won has pushed up import costs, including for energy. Surging housing prices in Seoul and surrounding areas, coupled with high household debt, are also a concern for Korean authorities.

The crashing won has benefited the country's exporters: the central bank said that the economy is continuing to benefit from the AI boom. Exports surged 70.9% in June from a year earlier, the fastest growth rate in nearly half a century. The near record exports helped boost the country's economy: Korea posted its strongest growth last quarter in nearly six years, and the government this week upgraded its economic growth forecast for 2026 to 3% from 2%, exceeding the IMF’s 2.6% projection.

Of course, the tighter financial conditions did not help the stock market which slumped 6.4% and reversed all of Wednesday's gains.

However, the bigger catalyst behind the latest Korean rout which sent the Kospi back into bear-market territory after falling about 27% from its June peak, and to the lowest level since April, triggering another set of KOSPI/KOSDAQ sell sidecars in the early-morning... 

... was an emergency market monitoring meeting for the Korea's financial regulator, which unveiled measures to curb risks from single-stock leveraged exchange-traded funds, seeking to stabilize a local stock market that has seen wild swings, as individual investors use record amounts of debt to chase profits amid artificial-intelligence-related jitters.

The Financial Services Commission said Thursday that it would suspend new listings of single-stock leveraged ETFs, ban securities firms and asset managers from advertising or marketing such products, and triple the minimum cash deposit for new investments to 30 million won, equivalent to around $20,000.

The measures, which are long overdue and should have been implemented while millions of retail investors were piling into the bubble earlier this year, are aimed at curbing speculative trading and reducing risks tied to highly leveraged investment products following recent bouts of market volatility. 

Most of these ETFs, launched in South Korea in May to track surging and often volatile memory-chip stocks, have been blamed for recent stock-market volatility. They are largely tied to Samsung Electronics and SK Hynix, which together account for about half of the benchmark Kospi’s market capitalization. 

At the center of the volatility are Samsung Electronics and SK Hynix, whose shares fell 8.8% and 12%, respectively, on Thursday. Even so, Samsung shares have more than doubled and SK Hynix shares have nearly tripled this year. Such leveraged ETFs are designed to amplify daily moves in the underlying stocks by two times, and according to most traders they exacerbate volatility through the daily rebalancing needed to maintain their investment objective.

Yes, they help accelerate gains on the way up, but once momentum turns, what ensues is a historic destruction of wealth. Nowhere is this more obvious than in the 3x levered Kospi ETF, KORU, which is down 70% from its all time high hit on June 1, and is back to where it was at the end of January.

Herald van der Linde, HSBC’s head of equity strategy for Asia Pacific, said in a note Thursday that risks include intensifying retail participation, much of it through newly issued leveraged single-stock ETFs and margin lending, estimated at $23 billion, in South Korea. Foreign investors’ exposure to South Korean memory-chip stocks is rising, likely keeping market volatility elevated and reinforcing the case for diversification, he said.

Foreigners, however, were not hanging around for today's rout: they, together with local institutions, jointly turned back as net sellers in KOSPI, with selling focused on Tech (-$1.0bn/-$1.6bn), while retail investors were net buyers (+$2.6bn in Tech). Local instos were the main net sellers today (selling -$1.6bn in KOSPI), while their ETF net-selling (-$738mn) amounted to c.46% of the total net-selling.

At the forefront of today's rout were the usual suspects: SK Hynix plunged -11.5% and Samsung Electronics tumbled -8.8%, giving back all of yesterday's gains to retrace towards the 100DMAs as they tracked US overnight weakness in the SOX/SKHY.

Unfortunately, the "emergency measures" are too little too late. as we said earlier this week, the party for Retail Kospi investors - who have bought everything foreign investors had to sell - is ending: retail Margin Calls are soaring, hit 5% last Friday and on Monday will be far higher.  Finally, retail brokerage deposits plunge by 30trn won to lowest level since feb 20

Retail Kospi investors bought everything foreign investors had to sell. But the retail party is ending: retail Margin Calls are soaring, hit 5% last Friday and on Monday will be far higher. Finally, retail brokerage deposits plunge by 30trn won to lowest level since feb 20 https://t.co/XuxMwzBx3G pic.twitter.com/rwhQtDOYLT

— zerohedge (@zerohedge) July 13, 2026

What's worst of all is that as Ioannis Blekos on Goldman's trading desk noted, as of July 13, "a total of over 1.2 million leveraged retail accounts across the Korean market triggered margin calls. Approximately 320,000–360,000 accounts were fully liquidated by brokers. South Korea has an adult population (aged 15–64) of 35.7 million people… i.e. 1 in 30 (3.4%) adults got margin called."

And so, once again regulators are "boldly" stepping in only after the market tumbles, and millions of local investors are left with nothing. If only they had been more proactive, and popped the Korean stock bubble before it reached record proportions and assured huge losses... 

So what happens next, now that the Korean bubble has burst: look for all that capital to shift to China. 

“Now that selling momentum builds in the Korean semis, investors are returning to China where valuations are depressed,” Vey-Sern Ling, managing director at Union Bancaire Privee, said, adding China’s tech performance has been inversely correlated with high-flying Korean memory names recently.

With leading Korean chip names down, investors are rotating out of the country, said Yi Ping Liao, portfolio manager at Franklin Templeton. “But interestingly it doesn’t look like a broad based rotation out of tech as Taiwan tech and China tech remain well supported.”

Conveniently for those wondering where to go, one week ago Goldman gave the answer in "As Korea Tumbles, Goldman Tells Clients To Rotate To "China AI Value Chain"."

Tyler Durden Thu, 07/16/2026 - 10:45