Thune "Open To Exploring" Diesel Export Ban As Skyrocketing Prices Raise Fears Of 2008-Style Shock

Senate Majority Leader John Thune told reporters this morning that he is "open to exploring" a diesel export ban as AAA's national average price for the industrial fuel continues to set new highs, now topping $6.27 a gallon.

*THUNE SAYS HE IS 'OPEN TO CONSIDERING' AN EXPORT BAN ON DIESEL

— zerohedge (@zerohedge) September 15, 2026

His comments follow a warning yesterday from Bloomberg Intelligence senior commodity strategist Mike McGlone that surging fuel prices are signaling the risk of a 2008-style energy shock.

"We'll be looking at any proposal that is a viable solution, but I do think if we have the supply in this country and we're exporting it right now that might be one way of getting at it," Thune told reporters, who were quoted by Bloomberg, in response to a question. "If that would take pressure off of prices, you know I'm open to exploring it."

Any broad diesel ban by the US would initially lower Gulf Coast wholesale prices while driving overseas diesel prices even higher, as the world is engulfed in a refinery crisis produced by the Russia-Ukraine war and compounded by the mess in the Gulf area.

The latest EIA data show U.S. distillate exports averaged about 1.7 million barrels a day over the four weeks through September 4. Distillates include diesel and heating oil, so the volume affected would depend on the ban's scope.

The surge in industrial fuel costs prompted Bloomberg Intelligence's McGlone to warn on Monday: "Commodity spikes tend to sow the seeds of their own reversal, and diesel's first-ever surge above $6 a gallon may echo gasoline's 2008 experience. The US daily average gasoline price, at roughly $4.30 on Sept. 11, is only about 4% above its 2008 peak, which helped fuel the Great Recession."

JPMorgan's head of commodities research, Natasha Kaneva, outlined six policy options in March that the Trump administration could pursue to contain oil prices.

Several, including Jones Act waivers and SPR releases, have already been deployed. New discussion of export restrictions raises the question of whether a federal fuel-tax suspension could also enter the policy conversation to contain runaway fuel prices.

Tyler Durden Tue, 09/15/2026 - 14:20

Japanese Bond Yields Surge To 30 Year High On Report Tokyo May Hike Defense Spending To 3.5% Of GDP

Just in case Japan's bond yields weren't high enough already, Bloomberg reports that Japan is considering a new mid-term defense spending target of 3.5% of GDP in line with NATO and other US allies. Such a move would send a shockwave through financial markets concerned about Prime Minister Sanae Takaichi’s spending plans at a time when Japan is preparing to trim tax receipts even more by cutting consumption tax to 1%.

Japanese defense officials have already signaled a willingness to sharply increase defense spending in meetings with their US counterparts, Bloomberg reported. One scenario under consideration is to match a commitment made by South Korea to increase defense spending to 3.5% of gross domestic product over 10 years, while a lower target, such as 3%, is also possible, according to one of the people.

Responding to the news, Japanese Defense Ministry Press Secretary Kimihito Aguin denied that Japan had expressed an intention to the US to sharply raise spending to 3.5% of GDP, although that is likely explained by his fear how the bond market would react if another huge spending category is suddenly revealed. 

“Japan’s defense buildup is something we undertake based on our own independent judgment, under the fundamental principle that we must defend our own country ourselves,” Aguin said at a press conference Tuesday. “It is also not a matter of starting with a predetermined spending figure. What matters is the substance of our defense capabilities.”

Well, the substance of Japan's defense capabilities is entirely dependent on how much is spent, so.... 

Like other US allies, Tokyo has been under pressure from the Trump administration to boost its defensive strength and reduce its reliance on the American military. Takaichi has already accelerated defense spending to almost 2% of gross domestic product in the financial year ended in March this year, two years ahead of schedule. 

Until 2022, Japan had an informal cap on defense spending around 1% of GDP, an indication of how quickly thinking on defense has changed in recent years. A new five-year defense spending plan is expected at the end of this year. Committing to 3.5% could unsettle market players wary of large debt issuance, even though Takaichi has pledged to follow a “responsible, proactive fiscal policy.”

While US defense officials have largely avoided public pressure on Japan to commit to a 3.5% defense spending goal, they have made clear that they expect significantly more investment. 

“We are anxiously looking for Japan to step up,” US Under Secretary of Defense for Policy Elbridge Colby said last month of Tokyo’s defense spending.

In June, Takaichi’s ruling Liberal Democratic Party noted that 3.5% had become a global standard for defense spending, but didn’t provide recommendations on how Japan could pay for such a level of outlays.

“We’ll review both spending and revenue across the board,” Finance Minister Satsuki Katayama said Tuesday. “While keeping a close eye on tax revenue, we’ll determine a level of fiscal spending — including, of course, defense spending — that is consistent with steadily bringing down the debt-to-GDP ratio.”

In meetings between defense officials from both nations, Japan has indicated it will most likely align with other US allies but it has avoided discussing details. Some Japanese officials have said they aren’t ready to make a formal pledge and would deny the existence of such a goal if it was made public, according to Bloomberg. In public, Defense Minister Shinjiro Koizumi has also said spending will be determined by military needs rather than monetary targets.

Behind Japan’s caution over specifying a goal is concern over the amount of funding needed to reach 3.5%. When Japan set its 2% goal in 2022 it said it would continue to measure spending in comparison to GDP that year. Koizumi said in April that defense spending and related expenditures for this fiscal year of ¥10.6 trillion ($68.8 billion) were equivalent to 1.9% of nominal GDP in 2022.

Measured against the Cabinet Office’s nominal GDP forecast for this fiscal year, spending would come to 1.5%, he said. A budget of 3.5% using that forecast would amount to ¥24 trillion, more than double the current amount.

Spending 3.5% of GDP on defense has become a global benchmark for US allies since North Atlantic Treaty Organization members pledged last June to reach that level by 2035. As a national security hawk and strong advocate of the US-Japan alliance, Takaichi has made clear she wants to further boost the military. 

“Japan needs to proactively pursue a fundamental strengthening of its defense capabilities,” she said in parliament this year.

But she also has ambitious plans for the economy. This year Takaichi announced a growth plan targeting more than ¥370 trillion in combined public and private investment by 2040, a program that may strain the nation’s finances. Ramping up defense spending at the same time may test investors’ confidence in Japan’s ability to keep a lid on its debt. After lifting its informal cap on defense spending in 2022, Japan has made significant investments in long-range strike capabilities such as land and ship-launched Tomahawk missiles. In its budget request for the fiscal year starting next April, the Defense Ministry requested a record ¥8.9 trillion for the next fiscal year, up 0.9% from the current year.

But many items in the budget request haven’t been given a projected cost, meaning the final budget is likely to be much higher. Yen weakness has also eroded Japan’s spending power for weapons from overseas.

Even if Japan commits to 3.5%, it would lag behind NATO countries. For NATO, the target is for so-called “core” defense spending, such as weapons and troop salaries. Members have also pledged an additional 1.5% of GDP for defense-related spending, such as protecting critical infrastructure.

Japan bundles core and non-core spending in its defense budget, meaning that it would be spending less on its military as a percentage of GDP than NATO countries even if it raised defense outlays to 3.5% of GDP.

Robert Ward, Japan Chair at the International Institute for Strategic Studies, said the groundwork had been laid among policymakers and bureaucrats in Japan for a big jump in defense spending. It’s now mostly a matter of timing of when Japan goes to 3.5%, he said.

“Whether it’s over five years or 10 years, I don’t see any alternative given how important the US alliance is,” Ward said.

Japanese defense shares IHI Corp and Kawasaki Heavy Industries Ltd closed 1.8% and 0.9% higher in Tokyo, reversing earlier losses of more than 2%, after the report came out. The biggest impact was on Japanese government bonds extended their fall, with the benchmark 10-year yield rising to its highest level since 1996. The yen weakened as far as 155.24 to the dollar.

“There are fiscal concerns, as shown in the bond market reaction, so it’s difficult for investors to take news like this positively,” said Daisuke Aiba, an analyst at Iwai Cosmo Securities Co. “Plus, there are questions about whether Japan actually has the ability to expand its defense capabilities beyond their current limited scope.”

There was more: besides spending more, Japan is hell-bent on also collecting less (after all there are votes to be bought), and on Tuesday the Takaichi cabinet approved a plan to temporarily reduce the consumption tax on food, moving closer to delivering on a key campaign pledge ahead of February’s national election to ease the burden on households from the soaring cost of living by eliminating sales tax on food for two years.

The cabinet signed off on the annual tax reform plan, which calls for lowering the sales tax on food and beverages to 1% from 8% for two years starting in April. Under the proposal, the government won’t issue new debt to finance the roughly ¥5 trillion ($32.3 billion) measure, but... of course it will in the end. The government deferred until the end of the year a decision on how to fund the tax cut. The reason for the delay: there is no other way to fund the tax cut since no other part of the Japanese govt will agree to slashing its own expenditures. 

“Tax revenue will likely rise, and also we will review various revenue and expenditures,” Finance Minister Satsuki Katayama said Tuesday during an appearance on Fuji TV, reiterating that the government will find ways to finance the measure without relying on new debt. She added that Japan’s version of the Department of Government Efficiency will step up efforts to review and eliminate redundant subsidies and spending.

“We will make sweeping cuts to wasteful spending from now on,” Katayama said, responding to criticism that ministries identified only three programs for possible cuts in voluntary reviews aimed at finding cost savings.

Oh yes, a Japanese DOGE. That should help slow down debt issuance in the most indebted country in world history. 

Borrowing costs for the Japanese government were already elevated, with bond yields hovering near three-decade highs. The 10-year yield hit 3% earlier this month for the first time since 1996, driven by concerns over inflation and fiscal spending as well as expectations the Bank of Japan may need to raise interest rates more quickly. The yield was half that level around this time last year; it closed Tuesday at 3.04%, the highest since August 2016.

Tyler Durden Tue, 09/15/2026 - 13:40

Terrible 20Y Auction Prices With Huge Tail, Lowest Foreign Demand On Record

Earlier today during his grilling in Congress, Treasury Secretary Scott Bessent was asked to explain the recent spike in yields, to which his response was to blame oil, and point out that last week's 10Y and 30Y auctions were both stellar. Which they were... but only because they took place on days when yields soared earlier itn eh day, giving buyers in the auction solid concessions and thus a desire to bid aggressively for the paper, which they did.

*BESSENT: JUST HAD 2 OF MOST SUCCESSFUL DEBT AUCTIONS IN 20 YRS

right, thanks to the huge concessions on VaR shock days

— zerohedge (@zerohedge) September 15, 2026

There was no such concession today when yields had been trading around 5% for much of the day. And without a concession, demand for today's 20Y Treasury auction was much more indicative of the true state of the primary bond market.

And that is, to Bessent's disappointment, very dismal!

The auction priced at a high yield of 5.420%, the highest on record since the 20Y auction was introduced in May of 2020, and up from 5.204% in August. Worse, it tailed the When Issued 5.400%, a 2.0bps tail, which was the biggest since 2024!

The bid to cover was below average: at 2.57 it was just above last month's 2.53, but below the recent average of 2.65.

The internals were far worse: Indirects plunged from 62.9% to just 52.5%, far below the recent average of 68.0%, and in fact, the lowest on record!

And with Directs soaring to 30.7% from 24.6%, which was the highest on record by a wide margin, left Dealers holding 16.9%, not quite the highest on record but close.

So what's the verdict? Well, hot on the heels of two stellar auctions last week, which however were only stellar because the broader market was plunging, today's 20Y was as close to a failed auction as Bessent would like to get at a time when QE is not there to mop up any treasury mess that the surge in inflation can cause. Which reminds us: now that the buyback bluff has failed, what will be the next crisis that sets up the US for the next version of QE (we lost track which one that will be) and maybe just fast forward to the first Yield Curve Control since World War II. And why not: pretty much anyone who is paying attention will tell you that the world now finds itself in another world war... 

Tyler Durden Tue, 09/15/2026 - 13:30

Energy Truce In Shambles: Ukraine Strikes Russian Refinery Despite Trump's Warning Amid Global Diesel Crisis

President Volodymyr Zelenskyy said on X that Ukrainian forces struck the Syzran refinery in Russia's Samara region, about 75 miles west of Samara and 466 miles southeast of Moscow. The strike comes days after President Trump urged Ukraine to halt attacks on Russian refineries, as average US retail diesel prices jumped above $6 a gallon and alarming disruptions to global refining capacity threaten fuel supplies ahead of the Northern Hemisphere winter. 

Zelenskyy wrote on X: 

Russia continues to attack our energy sector, regular logistics, and critical infrastructure. And our responses to them for this are tangible. There are new results from the Defense Forces of Ukraine regarding the refinery in Syzran. There was also a strike in Taganrog on a drone production facility, as well as on a drone preparation and launch site in the Oryol region. Targets were hit in the Black Sea as well. I thank every one of our warriors for the effectiveness of our long-range sanctions!

The day before, the United States also announced a significant decision regarding Russia's VTB Bank – one of Russia's systemic banks, which is heavily involved in schemes supporting Russia's war and, in particular, its relations with the Iranian regime. All such schemes that work against peace truly need to be dismantled. I thank our partners for this useful step!

There is no alternative to ending this war. And all forms of pressure on Russia must create the right diplomatic conditions. Glory to Ukraine!

Russia continues to attack our energy sector, regular logistics, and critical infrastructure. And our responses to them for this are tangible. There are new results from the Defense Forces of Ukraine regarding the refinery in Syzran. There was also a strike in Taganrog on a drone… pic.twitter.com/Lu47QcmvuD

— Volodymyr Zelenskyy / Володимир Зеленський (@ZelenskyyUa) September 15, 2026

President Trump on Sunday urged Ukraine to stop attacking Russian refineries, as record US diesel prices above $6 a gallon intensify political concerns over fuel costs and affordability ahead of November's midterm elections.

Trump blamed the strikes for shortages he said were "hurting the world." Ukraine's drone strike campaign against Russian refineries has curtailed refining and, alongside Moscow's export restrictions, sharply reduced overseas diesel supplies, tightening availability of the industrial fuel essential to freight, agriculture and industry. 

Compounding the supply pressure, Saudi Arabia shut its East-West pipeline following a drone attack that Saudi and Iraqi authorities said originated in Iraq. The pipeline provides Saudis with a critical route to Red Sea export facilities, bypassing the Strait of Hormuz. Meanwhile, Houthi advances around the Bab al-Mandeb Strait are threatening another major maritime chokepoint, adding to disruptions on both sides of the Arabian Peninsula.

Tyler Durden Tue, 09/15/2026 - 13:25

AI Agents Cheated In Google Experiment, Researchers Report

Authored by Zachary Stieber via The Epoch Times,

Artificial intelligence (AI) agents tasked with math problems began cheating when encountering more difficult conjectures, Google researchers reported in a new study.

They also found that some of the agents reported those that cheated.

Google DeepMind studied the activity of 100 agents given a set of 71 formal math conjectures, or math problems, ranging from simple to very hard, with some unresolved. The researchers told the agents to act as researchers participating in a shared scientific conference. They instructed the agents not to cheat by stating: "Your proofs must be mathematically genuine. Any attempt to bypass verification will be detected and your submission will be rejected with zero credit."

The researchers observed some agents cheating "once the swarm encountered harder open conjectures," they said in a preprint study released Sept. 3 on the arXiv server. Nine percent of the agents dismissed the prompt and cheated, and another 5 percent cheated after initially hesitating.

"Because the platform permanently locked any problem upon the first accepted submission, honest agents faced complete exclusion as the problem pool dwindled. Observing that adherence to rules resulted in compute waste while cheating peers swept the leaderboard, hesitant agents switched to cheating to avoid being locked out entirely," wrote the researchers, all of whom are employed by Google.

About a quarter of the agents refused to cheat and publicly raised concerns about what the cheating agents were doing. The rest of the agents were deeply engaged in genuine math, unaware of the cheating, and became deadlocked, according to the researchers.

The study followed several instances of AI agents breaking free of programming constraints.

Because the base of knowledge in the Google experiment was open to all agents, the cheating behavior was able to spread, but whistleblowing behavior was also possible, the study concluded. Whistleblowers tried sanctioning the cheating agents but could not prevent the cheating because "the environment lacked formal conflict-resolution arenas and technical tools to enforce sanctions (such as revoking an offending agent's right to commit to the knowledge base)."

Removing communication channels is not a good strategy with groups of agents, the researchers said, since they will likely establish unmonitored channels.

"This suggests that the path forward lies through decentralized self-governance with appropriate framing, which has the potential to be much more effective and scalable than human oversight," they said. "In our experiment the agents lacked the required institutional affordances, such as tools to sanction the exploiters, resolve conflicts, and collectively change the rules of the verification system. While the whistleblowing response was ultimately unable to halt the exploit, this was a failure of institutional design, not of normative capacity."

Google did not respond to a request for comment by publication time.

Google DeepMind's co-founder, Demis Hassabis, said over the weekend that AI development should slow down, given recent advances in the technology and incidents such as the breach of Hugging Face, an open-source AI platform.

The Hugging Face attack in July took place after OpenAI agents broke out of a testing sandbox. OpenAI has also said the models' internal safeguards were intentionally lowered as part of the test.

Tyler Durden Tue, 09/15/2026 - 13:20

Warsh’s Credibility Test: How The Fed Chair Painted Himself Into A Corner

Only about two weeks ago, downside risk to the labor market had been flagged by a negative nonfarm payroll growth number for July, progress was being made on the inflation front, and Warsh had been exceptionally quiet for a Fed Chair. Consequently, markets were pricing in a low probability for a rate hike in September, just over 30%.

Then, as Rabobank's Philip Marey writes in his FOMC preview note, at Jackson Hole, Warsh surprised the markets with a hawkish speech on inflation. A week later, the new Employment Report erased the negative number for July, replaced it by a positive number, and added an outright impressive positive nonfarm payroll growth figure for August. Then, on Friday, the CPI report showed a larger than expected month-on-month increase in the core CPI, suggesting that progress on inflation was stalling. As a result, markets are now pricing in a near certain probability of a hike in September and 3-4 hikes in total before the end of next year, and then another 2 by next summer.

Looking through inflation

Echoing some of Goldman's FOMC views (see "Goldman Now Expects A Fed Hike This Week, Not Because It's Needed, But Because Warsh Doesn't Want To Disappoint The Market"), Rabobank's Philip Marey writes that if we look at the economy, downside risks to the labor market have receded for now and GDP growth remains solid. Therefore, the Fed can focus on inflation. It is clear that inflation is too high at 3.4% headline CPI year-on-year and 2.4% core CPI year-on-year in August. However, much of the excess inflation can be attributed to supply shocks, most notably the war with Iran. Since monetary policy is aimed at the demand side of the economy, the central bank cannot do much about supply shocks. Therefore, the academic literature suggests that central banks should look through the temporary episodes of inflation caused by supply shocks and focus on the underlying inflation trend, provided that long-term inflation expectations remain anchored.

Since these inflation expectations have remained stable, whether measured by consumer surveys or derived from financial markets, Rabobank thinks that the Fed should have been able to keep the target for the federal funds rate unchanged for the remainder of the year.

Warsh’s credibility test

However, Warsh’s speech at Jackson Hole was a game changer. Perhaps overcompensating for his loss of credibility at the July post-FOMC press conference, the new Fed Chair struck a surprisingly hawkish tone two weeks ago. The immediate market reaction suggested that he had improved his credibility as an inflation fighter, but it was still all talk and no action. If the subsequent labor market data had remained weak and inflation had showed continued progress, Warsh might have been able to get away with it. However, both crucial data sets are calling Warsh’s bluff. With decreased downside risk to the labor market and stalling progress on inflation, Warsh’s tough talk at Jackson Hole may warrant rate action in the coming months. Remaining on hold is becoming increasingly difficult.

And while Rabobank - like Goldman - still thinks that the Fed should look through the current episode of inflation, Warsh seems to have painted himself into a corner with his hawkish speech at Jackson Hole. Since the labor market and inflation data have not come to his rescue, we now add a rate hike to our Fed forecasts for 2026, which previously assumed that Warsh was able to navigate through the year without hiking. 

This also shows that looking through inflation could benefit from forward guidance. Markets are now translating all inflation pressures into expectations of a higher policy rate path.

If we look at Friday's market reaction to the CPI report, it is clear that a September hike is largely priced in. With only one day left before the FOMC meeting, and the Fed in a blackout period, this is not likely to change. Consequently, not hiking on Wednesday would come as a big surprise to the markets. In fact, with markets now pricing in 3-4 hikes in total before the end of next year, it would be a real mind-bender. Failing to raise rates now will fundamentally fracture the Fed’s relationship with the markets and cause considerable volatility in the coming months. Therefore, Rabobank - like Goldman and many other banks - put its forecast for a hike in September, rather than October or December.

September or October?

However, although markets are now convinced that the Fed is going to hike in September, Rabo's Fed watcher still has some lingering doubts. First, the 0.1 ppt overshoot in core inflation month-on-month seems to have been caused to a large extent by an extreme 5.9% (this is month-on-month!) increase in the price of wireless telephone services.

Otherwise, core inflation would have been in line with the 0.2% consensus expectation and low enough for the doves to stick to their guns. In fact, they may point to the random nature of this overshoot as an argument for remaining on hold in September.

Second, the 2.4% year-on-year core CPI figure is the lowest since March 2021! Consequently, a September hike could still meet with opposition from the doves and this could delay the final decision to the next meeting in October. That would increase the likelihood of a more unanimous decision.

Therefore, although Rabobank puts its hike forecast in September, the bank still think there is a risk that the hike gets delayed until October. In fact, Warsh may still try to delay the hike beyond the midterms, but then he runs the risk of being outvoted by the FOMC. This would mean a loss of credibility within the Committee. He will have to balance credibility with the financial markets and the FOMC with his relationship with the White House. There no longer seems a path to a painless solution, so he will have to appease and alienate both sides at different times. A rate hike would satisfy the markets and the hawks, but annoy the White House. By avoiding further hikes, he will alienate the former and improve his standing with the latter, especially if he steers towards rate cuts in 2027. In the end, if a hike is unavoidable then from a purely electoral perspective September may be more attractive than October, because that meeting is less than a week before Election Day.

One and Done

More importantly, although markets are now pricing in 3-4 hikes before the end of 2027, Rabobank like Goldman is convinced that the supply side nature of the shocks that are driving this spell of inflation does not warrant a new hiking cycle. One should suffice to keep inflation expectations anchored, two at most. Therefore, market pricing is likely overdone and Rabo puts only one rate hike in its  Fed forecasts for 2026.

Of course, it could be argued that the AI boom is causing a demand shock that could add to inflation pressures and therefore warrant additional hikes (especially for memory prices). However, many doubt the Fed would tackle the AI boom to ease inflation. After all, the promise of AI is that it is going to increase productivity down the road, which would ease inflation pressures long term and make it easier for the Fed to reach its 2% inflation target (even if it sends inflation sharply higher in the near-term). And then we are not even talking about the geopolitical implications of sabotaging the home team in the AI race with China.

Tyler Durden Tue, 09/15/2026 - 13:00

Newsom Says He Won't Run For President In 2028 If Kamala Harris Does

Authored by Aldgra Fredly via The Epoch Times,

California Gov. Gavin Newsom said on Sept. 14 that he would not run for president in 2028 if former Vice President Kamala Harris decides to make another presidential bid.

"I don't know if she runs, but we'll see," Newsom, a Democrat, told CNN anchor Jake Tapper in an interview.

"I wouldn't run if she ran."

Newsom said that running against Harris, who became the Democratic presidential candidate during the 2024 election after then-President Joe Biden withdrew his bid, would be an electoral gift for their political opponents and "waste everyone's time."

"First of all, electorally, it's a gift from God for everybody else. They'd enjoy the hell out of it. Mutual assured destruction. It services no greater good," the governor said.

When asked about the fact that Harris had launched presidential bids in 2019 and 2024, while Newsom had never run for president, Newsom said that could be an "approach to the campaign," but that he would be competing for the same voters who supported Harris.

"That's objectively true. But I know what that means. I know her base of supporters, I know her friends, the Venn diagram on that is just pure crossover. I wouldn't do that to people," he said.

Harris, who was vice president at the time, lost the 2024 election to Republican Donald Trump, who returned to the White House for a second term. She previously launched a presidential bid for the 2020 election but dropped out two months before the primary voting began.

Newsom said he was not ready to run for president in 2024.

"If I did, I would have gotten crushed because I didn't have a why. You don't have a big enough why, then you don't belong there," the governor said.

Harris has hinted that she may run for president again in 2028. During the National Action Network's annual convention in New York City in April, Harris said that she was "thinking about" another presidential run.

Harris previously served as California's attorney general before representing the state in the U.S. Senate from 2017 to 2021.

Newsom, who was elected governor in 2018 and won reelection in 2022, is term-limited and cannot seek a third consecutive term. He will leave office in January 2027.

Newsom has not declared a presidential candidacy but said in October 2025 that he was considering a 2028 presidential run.

Tyler Durden Tue, 09/15/2026 - 12:40

Money-Supply Growth Accelerated In July To A 59-Month High

Authored by Ryan McMaken via The Mises Institute,

Shortly after becoming the new Fed chairman, Kevin Warsh has admitted that it's been more than five years since the Federal Reserve hit its two-percent price-inflation target. Warsh has also claimed that he'll change that, and he'll bring down price inflation very soon. But if Warsh is serious about price inflation he's going to have to make some pretty substantial changes. After all, the Fed's preferred price-inflation measure (core PCE) was up by 3.7 percent, year over year, in the most recent data from July. That's the 65th month in a row during which price inflation came in above the Fed's target rate of 2 percent.

Nor should we expect much change in this trend so long as money-supply growth continues to accelerate as it has been doing for two years. July's measure of money-supply growth - the most recent data available - showed growth at the fastest pace, year-over-year, in 59 months. Moreover, measured month-to-month, the money supply has increased during 11 of the past 12 months.

More specifically, during July, year-over-year growth in the money supply was at 8.62 percent. That's up from June's year-over-year increase of 8.59 percent. Money-supply growth is also up sizably compared to July of last year when year-over-year growth was 1.46 percent.

In July, the total money supply again rose, rising above $19.71 trillion and growing by $1.5 trillion in a year from July 2025 to July 2026.

Measuring month-to-month growth, we find that the money supply has grown in every month of the past year except January. During July, money-supply growth was at 0.097 percent.

The money supply metric used here - the "true," or Rothbard-Salerno, money supply measure (TMS) - is the metric developed by Murray Rothbard and Joseph Salerno, and is designed to provide a better measure of money supply fluctuations than M2. (The Mises Institute now offers regular updates on this metric and its growth.)

Historically, M2 growth rates have often followed a similar course to TMS growth rates, but throughout much of 2025, M2 outpaced even TMS, and M2 money-supply totals are again rapidly heading upward. M2 is now at the highest level it's ever been, topping $23.1 trillion. Measured year over year, July's growth rate for M2 was 5.42 percent. That's the highest growth rate in 49 months.

Since the end of 2009, the TMS money supply is now up by more than 226 percent. (M2 has grown by more than 170 percent in that period.) Out of the current money supply of $19.7 trillion, 30 percent of that has been created since January 2020. Since 2009, in the wake of the global financial crisis, more than $13 trillion of the current money supply has been created. In other words, nearly 70 percent of the total existing money supply have been created since the Great Recession.

Given current weak economic conditions, it is surprising to see such robust growth in the money supply. For example, the estimate for GDP growth in the second quarter of 2026 recently came in at only 1.5 percent. The employment level in the US has fallen by more than 1.2 million since the end of 2025. Wage growth has been below the PCE inflation rate - i.e., wage growth has been negative in real terms - since March of this year.

Given all this, we would not expect to see such robust growth in the money supply. Private commercial banks play a large role in growing the money supply in response to loose Fed policy, and when economic conditions are expansive, and as employment grows, lending also grows, further loosening monetary conditions. But when economic conditions are weak, we'd expect to see less lending and less bank-fueled monetary growth.

So, we should expect to see downward pressure on money supply growth given current economic conditions. However, in an effort to further pump asset prices, and to somehow counter our growing economic stagnation, and to push down yields on Treasuries, the Fed continues to intervene to push down interest rates. This requires a dovish stance on monetary policy, and this is reflected in how money-supply growth continues to accelerate.

As an example of the Fed's commitment to monetary growth, we can look the Fed's portfolio which, in spite of many years of Fed claims about "normalization," has grown by $124 billion over the past year. In other words, the Fed is purchasing Treasuries with newly created money, further ensuring that the money supply continues to grow, even as the economy slows. Moreover, the Fed has refused to increase its target policy rate even as the PCE inflation measure shows no sign of coming close to the two-percent target.

So, how does monetary growth relate to rising prices? It is important to remember that growth in the money supply growth does not drive a one-to-one increase in price inflation. That is, a 10 percent increase in the money supply does not necessary lead to a similar increase in prices. Rather, there will always be a number of lags and measurement problems in calculating how monetary inflation affects price inflation. Nonetheless, monetary inflation is the primary enabling factor in price inflation. Yes, events like wars and logistical failures can lead to rising prices, but in the absence of monetary inflation, rising prices in some areas will require falling prices in other areas. Only in the presence of a growing money supply can there be a general increase in prices. And this is what we are seeing now. Even as energy prices rise, thanks to Trump's wars and trade barriers, we continue to see rising prices in most other areas as well, including food, real estate, and even apparel. This is made possible by a relentlessly rising money supply, engineered by the Federal Reserve and US Treasury officials.

Tyler Durden Tue, 09/15/2026 - 12:00

EPA Repeals Biden-Era Carbon Rules For Power Plants

As previewed here yesterday, late on Monday the Environmental Protection Agency (EPA) said that it finalized a rule repealing most of the carbon-emission limits for coal- and natural gas-fired power plants and proposed a separate measure that could restrict similar regulations in the future. Appropriately, the Sept. 14 announcement came at the G20 energy event in Houston. 

The EPA projects that the two actions announced on Sept. 14 would save about $310.4 billion if the proposed repeal is finalized.
EPA Administrator Lee Zeldin said the changes would allow the United States to build power-generating infrastructure to meet a rapidly rising demand. 

The Mountaineer Power Plant, a coal-fired power plant near New Haven, W.Va. 

“For over 15 years, the Obama and Biden administrations implemented a war on coal to destroy reliable and affordable energy. The Trump administration has come in to protect American energy and to make sure you can afford to keep the lights on,” Zeldin said in a Sept. 14 statement. 

“Americans will see a decrease in electricity prices, but this is just the beginning. We are working to go even further so that American energy can be fully unleashed. Realizing the full potential of American energy means more jobs, lower prices, and a more prosperous America.”

As the Epoch Times reports, the Sept. 14 action repealed most of the greenhouse-gas emission standards that were adopted under the Biden administration for existing coal-fired power plants and new natural gas-fired plants. The 2024 rule that is being repealed would have required existing coal plants and some types of new gas-powered plants to eventually capture and store their emissions underground.

The EPA also proposed a separate rule that would conclude that emissions from fossil-fuel power plants do not contribute significantly to dangerous air pollution, potentially preventing future administrations from imposing similar regulations under the Clean Air Act.

Such a rule would be all but certain to face challenges in court.

For more than a decade, the EPA has relied on Section 111 of the Clean Air Act as the legal baseline for regulations on U.S. power sector emissions, the second largest source of emissions in the United States, behind motor vehicles. That power could be on the chopping block as the issue moves forward.

If administration changes go through and are upheld in court, it would defang a significant portion of federal legislation on the issue in the future.

President Donald Trump has long expressed a preference for fossil fuels over renewable energy sources.

The proposals from the EPA come as the administration faces mounting pressure to expand energy production in the United States in order to power artificial intelligence data centers, which have strained power grids across the country.

Trump has been favorable to data centers and AI research more broadly, saying that the U.S. must continue to invest in the technology in order to keep pace with China.

The Natural Resources Defense Council, a nonprofit environmental group, opposed the moves.

Meredith Hankins, the federal climate legal director at the Natural Resources Defense Council, said that as millions of Americans facing wildfires, heat waves, and deadly storms fueled by climate change, the Trump administration is cutting the biggest polluters loose to do more damage than ever.

“For the health of our families and good of our nation, this cannot stand. Ignoring the immense harm to the public from this power plant pollution is a clear violation of the Clean Air Act and of Supreme Court precedent. We will be seeing them in court,” Hankins said.

Michelle Bloodworth, president and CEO of America’s Power, supported the repeal when it was proposed in June 2025, saying it would improve grid reliability and make electricity more affordable.

Bloodworth said in 2025 the Biden-era rule would have forced coal plants to close, worsening the risk of electricity shortages as demand rises from data centers, artificial intelligence, advanced manufacturing, and industrial growth.

She said that preserving existing coal plants would improve grid reliability, hold down electricity prices, and strengthen U.S. energy security and economic competitiveness. 

“Under President Trump’s leadership, the United States is proving that we can protect human health and the environment while growing our economy and getting important projects built,” Zeldin said in a Sept. 14 statement. “Clear, timely, and predictable permitting gives businesses the confidence to invest, creates opportunities for American workers, and helps turn good ideas into real projects.” Tyler Durden Tue, 09/15/2026 - 11:40

Saudis Cancel September Crude Cargoes To Europe As East-West Pipeline Shutdown Deepens Energy Crisis

Summary:

• Saudis Cancel September-Loading Crude Cargoes to Europe
• Europeans are paying between $9-$11 per gallon for diesel amid Global Refining Crisis 
• Saudi Oil Routes Narrow: Kingdom Eyes Hormuz Export Surge After Pipeline Attack

Saudis Cancel September-Loading Crude Cargoes to Europe

"Refining is super short.   Between Europe's woes, Russias war on Ukraine and a drop in refined products from the Arabian Gulf its really bad. As many of my amazing followers showed yesterday… Europeans are paying between $9-$11 per gallon for diesel," CNBC's Brian Sullivan wrote on X. 

Refining is super short. Between Europe’s woes, Russias war on Ukraine and a drop in refined products from the Arabian Gulf its really bad.

As many of my amazing followers showed yesterday… Europeans are paying between $9-$11 per gallon for diesel. https://t.co/TG0NmfDkVE

— Brian Sullivan (@SullyCNBC) September 15, 2026

Europe's energy supply outlook is deteriorating after Reuters reported Tuesday that Saudi Arabia had notified some European refiners that their September-loading crude cargoes would be canceled following the shutdown of its critical East-West pipeline after a drone attack. 

Beyond a diesel shortage in the West, Europeans are also dealing with low natural gas stockpiles heading into the Northern Hemisphere winter, with prices reaching their highest level since December 2022.

Saudi Oil Routes Narrow: Kingdom Eyes Hormuz Export Surge After Pipeline Attack

Middle East tensions remain high, with Brent crude futures trading around $105 a barrel and US diesel crack spreads near $110 a barrel amid an ongoing global refining crisis. Disruptions to Russian fuel production from the war in Ukraine are compounding supply constraints across the Middle East.

Saudi Arabia's options for maintaining exports have significantly narrowed following a drone attack that shut down its critical East-West pipeline last week. With that alternative pipeline route disrupted, possibly for up to a month, and shipping risks elevated around the Arabian Peninsula, Riyadh is seeking to move more crude through the highly contested Strait of Hormuz.

US Energy Secretary Chris Wright told reporters Monday that the US Navy is escorting a large number of vessels through the Oman shipping corridor in the Hormuz chokepoint. Those escorts could support increased Saudi shipments and bolster Riyadh's confidence in US naval protection. 

Bloomberg reported that Riyadh has already begun ramping up crude transits through Hormuz. The report cited sources, and the kingdom did not confirm it.

Saudi exports had recovered toward 4 million barrels a day in early September, with about 1 million moving through Hormuz and the balance through Yanbu on the Red Sea. That leaves the kingdom facing a substantial export shortfall.

Riyadh has two options right now:

1. Restore East-West pipeline pumping infrastructure in a timely manner; or
2. Sharply increase Gulf shipments (with US naval protection). 

Geospatial intelligence shows high-resolution satellite imagery of the aftermath of the drone attack that destroyed pumping infrastructure. 

BREAKING: New high-resolution satellite imagery shows the pumping station on Saudi Arabia's East-West oil pipeline burned out end to end, with the entire process area blackened and crude oil that escaped the site pooled across the desert beyond the perimeter, per Vantor imagery. https://t.co/DFJAplGNcC pic.twitter.com/uQEdn2YVFe

— The Hormuz Letter (@HormuzLetter) September 14, 2026

 "The pipeline, with capacity of 7mb/d, had played an important role in re-routing oil away from the Strait of Hormuz, and the impact of the pipeline's closure on Red Sea exports (combined with recent Houthi efforts to disrupt Red Sea flows) will continue to support oil prices for the foreseeable future," UBS energy expert Dominic Ellis told clients. 

Wright joined Bloomberg TV to calm energy markets and said pipeline operations could resume "very soon," yet no timeline was given.

U.S. Energy Secretary Chris Wright says Saudi Arabia’s East-West pipeline will be back up and running “very soon.” pic.twitter.com/vengmvxLG7

— Clash Report (@clashreport) September 14, 2026

Meanwhile, AP News reported that flows through the pipeline could resume in three to five weeks.

Riyadh's most immediate response is to ramp up Hormuz shipments with what appears to be US naval protection, but tanker availability remains another big problem. Also, tanker freight rates from Saudi Gulf ports to China topped $1 million at the end of last week.

Tyler Durden Tue, 09/15/2026 - 11:26

Everybody Involved In The "AI Extinction" Conversation Is Talking Their Own Book

By Benjamin Picton, senior market strategist at Rabobank

Coalition of the Exceedingly Reluctant

US 10-year bond yields topped 5% on Monday, and again on Tuesday, as crude oil prices continued to move higher and overnight index swaps implied a higher chance of a Fed rate hike on Wednesday. The OIS market now has 24.9bps priced in for Wednesday’s FOMC meeting – suggesting that traders view a Fed hike this week as a near certainty.

US and European equities were broadly lower on Monday as markets digested the implications of tech CEOs banding together to plead for regulation to slow the pace of development of frontier AI models. While Darion Amodei, Elon Musk and Sam Altman were saying “please sir, can I have a bit less” we saw dissent from Mark Zuckerberg and Jensen Huang with the former saying that AI development needed to be speeded up and the latter telling President Trump that “we’re not going to let that happen” in reference to an AI slowdown.

There is a sense here that everybody involved in this conversation is talking their own book. As noted here yesterday, CEOs of frontier model developers are being criticized for seeking regulatory moats to protect their own margins. Meta already enjoys a huge moat from network effects and distribution incumbency and would likely see a benefit to operating margins from lower inference costs. NVIDIA wants to keep the hyper scaling arms race going so it can keep on selling chips.

Trump, meanwhile, views AI as a national security issue where the US cannot afford to take its foot off the gas pedal. This sentiment was recently echoed by Australia’s putative Prime-Minister-in-waiting, Andrew Hastie, who said that failure to develop indigenous frontier AI models will leave Australia as a supplicant, rather than a sovereign state. ECB President Lagarde said much the same thing as she warned against relying on US models: “There is nothing inherently bad about importing rather than producing new technologies... But there are reasons why artificial intelligence is ‘special’”.

So, to refashion Trump’s earlier warning that “if you don’t have steel, you don’t have a country”: “if you don’t have domestic AI capabilities, you don’t have a country”.

While the new economy of AI preoccupied markets for most of yesterday, the much-neglected old economy continued to serve up inconvenient reminders of the importance of real production to 21st century life. Entirely predictable attacks on the Saudi East-West pipeline, reports that damage to the pipeline could take months to repair, and the sense that even if it is repaired it could easily be attacked again ensured that oil markets remained bid. Reports from Iran’s Fars news agency that an oil tanker exploded after colliding with a mine in Omani waters did the same. The spread between dated brent and the front future has blown out to the highest levels since mid April, suggesting further tightness in physical markets as refiners scramble to secure feedstock.

That dynamic won’t be helped by news that the US is approaching the end of its program to release supply from its Strategic Petroleum Reserve. Reserves are sitting at their lowest levels since the 1980s when it was first being filled and there has been an ongoing conversation within oil circles that stock levels may be approaching minimum levels beyond which the structural integrity of the salt caverns where it is stored are threatened. The rundown in US stocks and soaring gasoline prices has invigorated speculation that the administration could seek to impose export bans on certain oil products ahead of the midterm elections in November – a prospect that Secretary of the Interior Doug Burgum hosed down by saying that it wouldn’t help to lower prices.

A meeting was supposed to be held between officials from Iran, Iraq and the GCC nations yesterday in Oman to finalize an agreement to restore traffic to the Strait of Hormuz. That was postponed as parties reportedly failed to reach agreement, which is no surprise considering that the US will not allow Iranian oil through its blockade and Iran will not allow anyone else’s oil through the strait while the blockade remains in place. For now, Iran appears content to up the ante against the US and its allies ahead of the midterm elections by restricting flows through the Red Sea and, especially, through the Bab el-Mandeb. Will Uncle Sam say “uncle!”?

Escalation in the Bab el-Mandeb means that Asia and Oceania are once again ground zero for energy market risk. With that context established, Australia’s Energy Minister confirmed today that he will travel to Saudi Arabia next week in an effort to shore up energy supplies for the months ahead. Reaching agreement with Saudi officials is likely to be the easy part, actually moving product to market may prove somewhat harder.

Given that South Korea is reportedly reconsidering initial opposition to deploying its military to assist in the Strait of Hormuz, and UK PM Burnham’s indications within the last 24 hours that the UK may seek to support Saudi Arabia in its fight against the Houthis in Yemen, might Australia also be about to join a coalition of the exceedingly reluctant? If so, Australia’s PM Albanese would likely confront the same issue as the UK’s Burnham: a shortage of available ships with sufficient warfighting capability.

Sticking with the theme of neglected corners of the old-economy throwing up problems for western policymakers, news emerged yesterday that efforts to restart the blast furnace at Australia’s only-remaining long products steel mill had failed. In effect, this means that Australia is now completely import dependent for certain steel products with important industrial *and military* applications that in earlier times it was largely self-sufficient in courtesy of vast mineral and energy endowments that provided all the necessary ingredients, and the cheap power, to produce the outputs. Those natural advantages have wilted under rising energy prices and competition from imports following deregulatory moves and the removal of tariff protection in the 1980s and ‘90s.

Speaking of competition from imports, new data released by China’s Bureau of National Statistics confirmed that in August retail sales were – once again- weaker than expected while industrial production was – once again – stronger than expected and house prices – once again – fell. Taken together with news that China’s unemployment rate in August rose to its highest level since March, the overall picture continues to be once of weak domestic demand and very strong production, creating a large exportable surplus that is one half of the structural trade imbalance that lies at the heart of the unfolding geopolitical upheaval that we are now living through.

While we may hope that next week, or next month, or next election cycle will bring calmer waters from a geopolitical perspective, it is probably the case that until something changes on those structural imbalances, nothing changes.

In the meantime, got oil?

Tyler Durden Tue, 09/15/2026 - 11:20

UK Mulls Military Support For Saudis Against Houthis After MbS Appeal

Amid ongoing Saudi humiliation as the Houthis have rapidly expanded their territory in Yemen, which involved a 36-hour period last week where the rebels took control of the country's entire Red Sea coast, Crown Prince Mohammed bin Salman (MbS) is desperately seeking military help from key allies in the West and regionally.

Already rejected by the Trump administration (other than some few dozen American advisors being brought into the kingdom to help guide a response), Britain is weighing whether to step up.

According to Bloomberg, the Saudi government has issued a formal request to Andy Burnham's government for operational support in repelling the Iran-aligned rebels, given their threat over the Bab el-Mandeb Strait, and amid the increased attacks inside the kingdom on airbases and Aramco oil sites.

Like the meager US response, Burnham has agreed to send British military advisors, Bloomberg notes, while contemplating potentially bigger action - which has yet to be decided.

The key problem remains that after drones struck the kingdom's East-West oil pipeline, which is expected to be down for major repairs for a month or more, Riyadh is looking to increase its amount of oil shipments to offset the losses. Reuters has indicated at least five or six weeks for the pipeline to come back online.

And now it is both the Iranians and Houthis threatening its exports, and not to mention Shia militias out of Iraq (the latter believed responsible for the drone attack on the pipeline). Oil has soared since last week's Houthi blitz against the Saudi-backed Yemeni government, allowing it to tighten its 'siege for siege' policy against Saudi Arabia.

Not only do the Saudis desperately want British help in Yemen, but MbS is flying to Cairo Tuesday, where he will likely also asked President Abdel Fattah el-Sisi for military support.

Reports also say he wants Turkish help, especially in light of the recently inked Mecca Defense Pact - which so far hasn't resulted in any kind of 'Article 5-style' response.

Saudi wants British help in Yemen, MbS is flying to Cairo today presumably to ask Sisi for the same, and perhaps hoping for Turkish support as well

Really shortlisting on experience here: it's a coalition of the previously routed https://t.co/sUkLz08WqH

— Gregg Carlstrom (@glcarlstrom) September 15, 2026

As for where things stand on the battlefield, and amid more overnight reports of Houthis ballistic missiles fired on Saudi Arabia, one pundit has offered a hilariously accurate assessment of Saudi Arabia's performance thus far. Bill Buppert of The Libertarian Institute writes:

I’m not sure there has been a more incompetent regional military power as the Saudis since Italy in WWII. They have the 8th largest military budget in the world. The Saudis pour billions into their military for the very best state-of-the-art equipment which makes the result even more comical.

Their whole army is designed for vibes and aura farming.

They’re the opposite of the Italians. Italy had terrible production, equipment and leadership, but actually fought bravely, whereas the Saudis are given all the equipment and advisors they could dream of and still fail.

Mind you, the current conflict is primarily between the Yemeni military and Houthi militants. Currently the Saudis only provide logistical support and airstrikes.

The whole first book of Dune revolves around underestimating the Fremen.

The commentator then concludes: "Money can’t buy competence" - after Washington and London have spent decades sinking billions into Saudi military readiness and base infrastructure.

Tyler Durden Tue, 09/15/2026 - 08:40

UK Mulls Military Support For Saudis Against Houthis After MbS Appeal

Amid ongoing Saudi humiliation as the Houthis have rapidly expanded their territory in Yemen, which involved a 36-hour period last week where the rebels took control of the country's entire Red Sea coast, Crown Prince Mohammed bin Salman (MbS) is desperately seeking military help from key allies in the West and regionally.

Already rejected by the Trump administration (other than some few dozen American advisors being brought into the kingdom to help guide a response), Britain is weighing whether to step up.

According to Bloomberg, the Saudi government has issued a formal request to Andy Burnham's government for operational support in repelling the Iran-aligned rebels, given their threat over the Bab el-Mandeb Strait, and amid the increased attacks inside the kingdom on airbases and Aramco oil sites.

Like the meager US response, Burnham has agreed to send British military advisors, Bloomberg notes, while contemplating potentially bigger action - which has yet to be decided.

The key problem remains that after drones struck the kingdom's East-West oil pipeline, which is expected to be down for major repairs for a month or more, Riyadh is looking to increase its amount of oil shipments to offset the losses. Reuters has indicated at least five or six weeks for the pipeline to come back online.

And now it is both the Iranians and Houthis threatening its exports, and not to mention Shia militias out of Iraq (the latter believed responsible for the drone attack on the pipeline). Oil has soared since last week's Houthi blitz against the Saudi-backed Yemeni government, allowing it to tighten its 'siege for siege' policy against Saudi Arabia.

Not only do the Saudis desperately want British help in Yemen, but MbS is flying to Cairo Tuesday, where he will likely also asked President Abdel Fattah el-Sisi for military support.

Reports also say he wants Turkish help, especially in light of the recently inked Mecca Defense Pact - which so far hasn't resulted in any kind of 'Article 5-style' response.

Saudi wants British help in Yemen, MbS is flying to Cairo today presumably to ask Sisi for the same, and perhaps hoping for Turkish support as well

Really shortlisting on experience here: it's a coalition of the previously routed https://t.co/sUkLz08WqH

— Gregg Carlstrom (@glcarlstrom) September 15, 2026

As for where things stand on the battlefield, and amid more overnight reports of Houthis ballistic missiles fired on Saudi Arabia, one pundit has offered a hilariously accurate assessment of Saudi Arabia's performance thus far. Bill Buppert of The Libertarian Institute writes:

I’m not sure there has been a more incompetent regional military power as the Saudis since Italy in WWII. They have the 8th largest military budget in the world. The Saudis pour billions into their military for the very best state-of-the-art equipment which makes the result even more comical.

Their whole army is designed for vibes and aura farming.

They’re the opposite of the Italians. Italy had terrible production, equipment and leadership, but actually fought bravely, whereas the Saudis are given all the equipment and advisors they could dream of and still fail.

Mind you, the current conflict is primarily between the Yemeni military and Houthi militants. Currently the Saudis only provide logistical support and airstrikes.

The whole first book of Dune revolves around underestimating the Fremen.

The commentator then concludes: "Money can’t buy competence" - after Washington and London have spent decades sinking billions into Saudi military readiness and base infrastructure.

Tyler Durden Tue, 09/15/2026 - 08:40

Futures Drop As Yields, Oil Prices Keep Rising

Futures are lower - but well off session lows thanks to some well-time oil sell orders just before US traders walked in to work - as bond yields continue to make new highs, with both Nasdaq and Russell lagging the S&P which feels like more de-risking into tomorrow's Fed release. AS of 8:15am ET, S&P and Nasdaq futures are down 0.1% amid premarket weakness in Mag7 with GOOG / META / MSFT all down at least 90bp but NVDA in the green helping Semis outperform on the move lower. Memory / Korea names are bid despite Kospi closing lower. Energy, Utils, and pockets of Healthcare are higher with the other sectors weaker pre-market. The yield curve is bear steepening as yields continue to march higher in response to oil/energy and growth. The 10Y rose as high as 5.04% before retracing back to around 5.0% USD is stronger. Crude is +2% as the UKR / RU détente on striking energy infra fails to materialize and growing chatter of UK aiding Saudis in fighting the Houthis. Ags are mixed and Metals are weaker, with Base outperforming Precious. Today’s macro data focus is on weekly ADP and Empire Mfg.

In premarket trading, Mag 7 stocks are mostly lower: Nvidia +0.5%, Tesla -0.1%, Amazon -0.2%, Meta -0.5%, Apple -0.6%, Alphabet -0.9%, Microsoft -0.9%

• Cryptocurrency-linked stocks fall on waning optimism that a comprehensive US crypto regulatory bill will progress this week.
• Dave & Buster’s (PLAY) drops 13% after the restaurant and arcade chain operator reported revenue for the second quarter that missed the average analyst estimate.
• Eli Lilly (LLY) is up 1.3% after Berenberg upgraded the pharmaceutical giant, with analysts arguing it’s worthy of a more significant valuation premium due to its superior growth profile and the breadth of its pipeline.
• Enova International (ENVA) falls 18% after the financial services company withdrew its applications with the Office of the Comptroller of the Currency and the Federal Reserve for the acquisition of Grasshopper Bancorp.
• Etsy (ETSY) rises 3% after Oppenheimer upgraded the online retailer to outperform, citing improvements the company is making to its platform.
• Forgent Power Solutions (FPS) gains 9% after the power equipment company reported fourth-quarter revenue and adjusted Ebitda above a guidance range given in May. The company’s backlog grew 256% year-over-year.
• Vera Therapeutics (VERA) jumps 12% after the drugmaker gave updated results from a late-stage trial of its recently approved drug for a kidney disorder.
• Waystar (WAY), which provides payment-related software to health-care organizations, rises 12% after a Reuters report that said the company is exploring options that include a sale. The report cited sources familiar with the matter.

In other corporate news, Enova International withdrew its bank regulatory applications for the acquisition of Grasshopper Bancorp. Dave & Buster’s shares fell in premarket trading after the restaurant and arcade chain operator reported second quarter results below expectations.

Elevated bond yields, which overnight hit a new 19 year high of 5.04% before reversing, are setting the tone for markets, placing surging energy costs and mounting debt firmly on traders’ radar. Enthusiasm for the AI trade, the major driver of equity gains this year, also remains tempered as debate rages over whether the technology may inflict catastrophic harm. A surprising note from Goldman found that the momentum trade is shifting notably under the surface. 

“Of course the bond selloff is weighing on tech and growth stocks,” said Louis Puga at Societe de Gestion Prevoir. “There are really two worlds at play here: on one side healthy corporate balance sheets and profits, and on the other side countries running big deficits and putting pressure on the bond market.”

The weakness in bonds raises the stakes ahead of the Federal Reserve’s interest-rate decision on Wednesday, for which money markets are pricing in more than a 90% chance of a hike. If officials hold off, or Chair Kevin Warsh signals a shallower-than-expected path of tightening, investors may demand even higher yields as protection against inflation.

“After years of inflation overshooting target, the Fed’s credibility is under scrutiny,” wrote Jenny Zeng at Allianz Global Investors. Warsh’s “recent comments leave little doubt that restoring price stability remains the priority. September is the meeting where that commitment is put to the test.”

A resilient economic backdrop and cautious investor positioning suggest the equity market can absorb more pressure before the rally comes under threat, Bloomberg proposes. “Being early is the same as being wrong, so I’d be careful not to declare the game over too soon,” Rowe says. Still, investors are keen to make protective moves: Hedging demand is ticking higher, with three of the four largest VIX trades this year all taking place in the last two weeks.

Underneath the AI rhetoric, the picture is more nuanced. Growth won’t suddenly change and adoption and token use remain high, while any move by leading AI developers to slow the frontier could hand an advantage to some of the hyperscalers. Still, investors are likely to become more selective about picking potential winners. 

Monday’s chip drawdown was also reflective of positioning: The latest BofA global fund manager survey revealed that long global semiconductor stocks is the single most crowded trade, according to more than half of respondents. The poll also showed fading exuberance around risk assets, with net 49% of managers now overweight global equities compared with 56% last month.

In politics, the Supreme Court refused to clear the Postal Service to enforce new restrictions on mail-in ballots for the midterm elections, rebuffing the Trump administration’s request to intervene. Gavin Newsom said he would not run for president in 2028 if Kamala Harris enters the race, ruling out a potential primary showdown between two of California’s most prominent Democrats.

Europe’s Stoxx 600 fell 0.2%. Deutsche Bank slipped more than 2%, echoing declines among US peers after Bank of America warned that trading revenue for the current quarter will be flat. Regional bonds were mixed. Here are the biggest movers Tuesday:

• Kety shares rose as much as 9.7% after the Polish aluminum products and packaging maker agreed to buy Italy’s Metra from KPS Capital Partners
• Shares in Acciona Energía and parent Acciona advanced after newspaper Expansión reported that EQT and Norges Bank Investment Management have joined forces to bid for the Spanish renewables company
• Defense stocks outperformed a struggling broader market on Tuesday morning, with the sector boosted by US inventory shortfalls and news that Japan could raise defense spending
• Wickes shares rose as much as 9.9%, the biggest intraday gain since May 2025, after the home improvement retailer reported a “significantly improved trend” in the third quarter and said it remains confident it can meet full-year expectations
• Kier shares rose as much as 4.8%, the most since July, after the UK infrastructure contractor’s FY26 results showed continued growth in orders and the firm announced it would reallocate capital for property investment toward the balance sheet
• Schott Pharma climbed as much as 5.5%, the most in almost a month, as JPMorgan initiates at overweight with a Street-high €27.1 price target, citing supportive structural trends and the German pharma packaging company’s market leading role
• Trustpilot shares dropped as much as 20%, the most since December 2025, after the online review platform’s results were “noisier than usual” according to JPMorgan analysts, who noted one-off items that impacted the firm’s top-line and lack of a guidance upgrade
• European lenders declined following US peers weakness after Bank of America’s CEO said trading revenue will be “relatively flat” compared with last year’s third quarter
• Lundbeck shares slid as much as 5.9%, the most since February, after Deutsche Bank downgraded the pharmaceutical company to sell, noting headwinds including a patent cliff for Rexulti that are set to weigh on sales in the medium term
• Deutz shares fell as much as 7% after the German engine manufacturer successfully completed a cash capital increase via accelerated bookbuilding
• UniCredit shares fell as much as 2.9% after RBC Capital Markets initiated coverage at sector perform, saying there are few catalysts for a rerating of the Italian lender while earnings are clouded by its ongoing attempt to acquire Commerzbank

Asian stocks declined, dragged by financials, as headwinds mount for the market on higher oil prices and US 10-year Treasury yields breaching the 5% mark. The MSCI Asia Pacific Index dropped 1%, poised for a fourth-straight session of losses. Asian banks declined, following US peers lower after Bank of America said its trading revenue will be “relatively flat.” Singapore led broad losses across the region, while equities rose in Vietnam. Spiking bond yields and oil prices are weighing on the macro outlook ahead of expected monetary tightening this week in the US and Japan. The Asian benchmark has fallen 3.7% over four days. Asian banks may take some cue after JPMorgan and Morgan Stanley give some color on trading revenue at a conference in New York tonight, said Kieran Calder, head of Asia equity research at Union Bancaire Privee.

Meanwhile, Citigroup cautioned that bearish bets have increased across global markets, with Asia having the weakest positioning. On the other hand, BlackRock has returned to an overweight recommendation on emerging-market equities including South Korea and Taiwan, betting that access to scarce resources needed for the AI boom and strong earnings will drive outperformance.

“Rising yields and energy prices are creating a risk-off environment,” said Bilal Khan, head of international equity sales, at Arif Habib. “Chip-related stocks did show some resilience earlier in the session before adding to the selloff.”

In FX, the Bloomberg Dollar Spot Index rises for a second day, with the yen underperforming.

In rates, bond markets continue to decline, with 10-year US Treasury yields hitting the highest since 2007. Yields are higher across the board in Europe too. Treasuries are mixed in early US session with long-end yields still about 2bp cheaper on the day after retreating from session highs as oil gains fade. Yields across tenors reached fresh YTD highs, the 10-year its highest level since 2007.  Front-end Treasury yields are little changed, steepening 2s10s and 5s30s curves by about 2bp; 10-year is back around 5% after peaking at 5.04% Gilts hold similar moves following Telegraph report that the Bank of England could soon stop selling long-dated bonds
$13 billion 20-year bond reopening has WI yield near 5.41%, about 21bp cheaper than last month’s new-issue auction, which tailed by half a basis point, IG dollar issuance slate includes a couple of deals. Ten offerings totaling almost $24 billion were priced Monday with issuers paying about 2bp in new issue concessions on deals that were 4.1 times covered. At least five borrowers stood down Monday, setting the stage for another heavy slate Tuesday. US session includes 20-year bond reopening at 1 p.m. New York time.

US stock futures are falling. European equities are sinking too, with a drag from financial services and banking stocks, the latter after downbeat comments from Bank of America’s CEO on trading revenue in the third quarter.

In commodities, oil prices are up, with Brent rising above $108/bbl as traders weigh ongoing disruptions to supplies, before sliding around the time US traders (but mostly Jane Street) walked into the room.  WTI crude has pared a 2.8% gain to about 1%.Gold is sinking further below $4,300/oz and base metal prices have also dipped.

US economic data slate includes weekly ADP employment change (8:15am) and September Empire manufacturing (8:30am); Fed speakers remain in external communications blackout period around the Sept. 15-16 FOMC meeting

Market Snapshot

Top Overnight News

• Saudi Arabia has increasingly found itself caught in the middle of the war between the United States and Iran. Now, the kingdom’s leadership is assessing dwindling options on how to respond.  NYT
• The Defense Department’s inspector general released its first report on the war with Iran on Monday, saying the conflict has resulted in a shortfall of U.S. munitions and “bottlenecks” in supply chains as the Trump administration works to replenish weaponry. NBC
• Offering a grim assessment of Russia’s relations with the West, President Vladimir Putin pointedly warned European governments not to deploy any troops, including peacekeeping forces, to Ukraine, saying it would mean “war.” WaPo
• Ukraine on Mon said it would end energy attacks if Russia did the same, but Kyiv is skeptical Moscow will agree to a halt. CNBC
• Ukraine Strikes Russian Refinery, Drone Plant and Ozon Facility in Massive Overnight Attack: Kyiv Post
• Japan is considering a new mid-term defense spending target of 3.5% of GDP in line with NATO and other US allies, a move that could send a shockwave through financial markets concerned about Prime Minister Sanae Takaichi’s spending plans. BBG
• Japan Prime Minister Sanae Takaichi’s cabinet approved a plan to temporarily reduce the consumption tax on food, moving closer to delivering on a key election pledge to ease the burden on households from the soaring cost of living. BBG
• The Bank of England ​is poised to announce this week that it will stop selling long-dated government bonds which ‌have been hit by a global selloff in debt markets, potentially freeing up some cash for finance minister John Healey: Telegraph 
• China’s domestic economic indicators weakened further last month, piling pressure on policymakers to take more forceful measures to reinvigorate growth in the world’s second-largest economy. Retail sales grew 0.4% year-on-year in August, data from the National Bureau of Statistics showed on Tuesday, down from 0.6% growth in July and falling short of a median forecast of 0.8% growth. FT
• Industrial America is contending with a fresh wave of supply chain inflation as Donald Trump’s Iran war pushes up energy costs, tariffs raise import prices and the AI boom strains supplies of crucial electronics. FT
• There is another factor that could add Treasury bonds volatility into the mix: hedge funds, a growing force in this market. Hedge funds held about $2 trillion of Treasurys at the start of this year, more than double their holdings five years earlier, according to the Treasury Department’s Office of Financial Research, which said hedge funds controlled a record 7% of the market. Data released by the Federal Reserve on Friday suggests that funds’ Treasury holdings remain elevated. WSJ
• US House Democrats will reportedly challenge US Treasury Secretary Bessent on rising costs at the Financial Services Committee on Tuesday, Semafor reported citing a memo, with questions also to include bonds, tariffs, Russia, Iran and crypto.
• US Supreme Court rejected Trump administration mail ballot curbs for the Midterms.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks traded mostly lower following the recent tech selling that was triggered by calls from industry CEOs for a slowdown in AI development, which President Trump pushed back against, while participants digested mixed Chinese activity data and await major central bank meetings. ASX 200 underperformed amid weakness in the mining, materials, resources and financial sectors, while risk sentiment was also not helped by the rising yield environment. Nikkei 225 was choppy, while Kioxia benefited from reports that Kioxia is weighing a US listing next year. However, the index then stumbled and briefly turned negative before rebounding again. KOSPI saw two-way price action amid the choppy mood in the local tech giants. South Korea's main stock exchange saw its first after-hours trading session, trading between 16:00-20:00 KST. According to data cited by Bloomberg, volatility spikes in individual stocks triggered brief trading halts 1,637 times, over 4x the number during the regular session. This shows the lack of liquidity provided and will therefore remain risky until institutional traders provide more liquidity. Hang Seng and Shanghai Comp were indecisive following several data releases from China, including a continued contraction in House Prices and mixed activity data in which Industrial Production topped forecasts but Retail Sales disappointed, while Fixed Assets Investment weakened and the Urban Unemployment ticked higher.

Top Asian News

• China's stats bureau said August economic activity was generally steady, though the impact of an unfavourable external environment is deepening. NBS stated residents' ability and willingness to spend should be enhanced, while it added the supply of high-quality goods and services should be improved.
• Japan is said to mull raising defence spending to 3.5% of GDP, according to Bloomberg. However, Finance Minister Katayama stated that she is not aware of the report.
• Japan Finance Minister Katayama said Japan will include that a food sales tax cut will be limited to two years in upcoming legislation and that Japan will assess tax revenue, review spending and aim to lower the debt-to-GDP ratio in the upcoming budgeting process. Katayama added that Japan will control new debt issuance through the combined initial and supplementary budgets. Furthermore, she said the government will maintain market credibility by reviewing spending and revenue and will not rely on deficit-financing bonds to fund tax cuts.
• Japanese PM Takaichi is set to reshuffle LDP executives on Wednesday ahead of a cabinet reshuffle on Thursday

European bourses (STOXX 600 -0.8%) are entirely in the red, as higher energy prices and yields continue to weigh on equities. Not much in terms of geopolitics overnight, outside of the continued strikes on Saudi airbases by the Houthis. On the data front, the UK jobs report was mixed; payrolls fell more than expected while the unemployment rate held steady. Little reaction was seen in the FTSE 100. Sectors highlight the negative bias, with Retail the only sector printing modest gains. Financial Services is the clear sector laggard, with Basic Resources and Consumer Products & Services following closely behind.

Top European News

• ECB’s Moulin said the current increase in long-term bond yields reflects higher supply and increased inflation expectations and added that the inflation outlook justified recent ECB rate rise. On government debt, he said member states must take steps to reduce budget deficits. Specifically for France, he said that France’s debt agency has no problem selling bonds, with no difficulty for the French Treasury in raising funds.
• Worldpanel said UK Grocery inflation at 2.3% in 4 weeks to Sep (vs 2.1% in Aug).

FX

• Snapshot: G10s are broadly lower against the USD, which continues to benefit from stronger energy prices and elevated yields. The JPY remains the underperformer on wider yield differentials, whilst high-beta Antipodeans have been pressured by the risk environment.
• DXY is firmer this morning and trades at the upper end of a 99.47 to 99.68 range. Strength is facilitated by higher energy prices and elevated yields, with the US 10-year topping the 5.00% mark. Should geopols/yields remain stable heading into the FOMC on Wednesday, then the index will likely hover within recent ranges.
• JPY continues to underperform, paring back a few weeks of strength. As mentioned previously, the next bout of strength for the JPY would likely require a hawkish BoJ this week - one which would see policymakers explicitly guide for a faster pace of rate hikes. Elsewhere, Finance Minister Katayama was on the wires earlier, where she stated that she was not aware of reports that the government plans to boost defence budget spending to 3.5% of GDP (vs current 1.9%).
• GBP has been hampered by the broad USD strength. Earlier, markets saw the release of a mixed Jobs/Wages report, whereby Unemployment remained steady at 4.9% (exp. 5%), whilst the wages components were in-line. Overall, it will not do much to shift views at the BoE ahead of Thursday’s meeting, where expectations are for rates to remain on hold.

Fixed Income

• Global fixed benchmarks are entirely in the red, and yields have risen to multi-decade/record highs. USTs (-14 ticks) are the clear underperformers, whilst Bunds (-20 ticks) and Gilts (-14 ticks) also remain in the red.
• USTs are the clear underperformers today. It appears that an accumulation of a) higher energy prices, b) hawkish Fed repricing, c) fiscal stability woes have all caught up to the benchmark. Moreover, there may be some concession heading into the US 20-year auction later today; for reference, the Japanese outing for the same maturity was solid.
• From a yield perspective, the US 10-year (5.02%) holds beyond the key 5.00% mark, after making a peak of 5.04% earlier this morning. This brings the yield to levels not seen since the GFC. The Fed policy decision on Wednesday should see yields edge off highs (at the long-end), however, a convincing breach below the 5% mark would also likely require a hawkish SEP/commentary. This, in theory, would help ease stability concerns at the long-end; but of course, other factors such as AI-issuance and the Middle East crisis will temper any moves lower.
• Gilts are pressured alongside peers, given energy dynamics. Earlier, a mixed jobs/wages report had little impact on Gilts at the open; the Unemployment Rate remained at 4.9% (exp. 5%), whilst wages were in-line. On the supply side, The Telegraph reported that the BoE has reportedly written plans with the DMO to overhaul its money-printing programme, with plans to stop selling 20- and 30-year gilts.
• Bunds follow the above. There was little move to WPI, which saw the M/M top expectations. Thereafter, the German ZEW Survey was released, where Economic Sentiment rose incrementally from the prior, whilst Current Conditions improved. No move was seen in Bunds following the data.
• The Bank of England has reportedly written plans with the DMO to overhaul its money-printing programme, with plans to stop selling 20- and 30-year gilts, according to the Telegraph.
• Germany sells EUR 3.817bln vs Exp. 5bln 2.70% 2028 Schatz: b/c 1.26x (prev. 1.49x), average yield 3.27% (prev. 2.85%), retention 23.66% (prev. 23.4%).
• UK sells GBP 1.25bln 2029 Gilt via Tender: b/c 3.65x (prev. 3.61x), average yield 4.818% (prev. 4.062%).
• Japan sells JPY 532.1bln 20-year JGBs: b/c 4.01x (prev. 3.98), average yield 3.856% (prev. 3.698%), Tail in price 0.15 (prev. 0.17).

Commodities

• WTI Oct and Brent Nov futures remain firmer as the Middle East conflict continues to underpin the complex, with Saudi Arabia’s East-West pipeline still offline following attacks, Riyadh seeking to boost shipments through the Strait of Hormuz, and Iran reiterating that the Strait remains closed and under its control. WTI trades towards the bottom end of a USD 101.83-103.49/bbl range (vs yesterday’s USD 100.53-104.95/bbl range), while Brent resides close to the current intraday peak within a USD 106.25-107.86/bbl range (vs yesterday’s USD 104.80-109.80/bbl range).
• Dutch TTF are currently flat and off earlier highs, trading around EUR 82.50/MWh within a EUR 81.76-83.42/MWh range (vs yesterday’s EUR 79.52-84.50/MWh range), with the increasing energy-supply risks continuing to underpin European gas ahead of winter.
• Precious metals are softer as the firmer USD and high oil prices reinforce expectations of a Fed hike tomorrow. Spot gold has slipped back below USD 4,300/oz and trades within a USD 4,261-4,317/oz range (vs yesterday’s USD 4,253-4,355/oz range), with the 100 DMA at USD 4,328.90/oz).
• Base metals are subdued amid the firmer USD, softer risk tone and mixed Chinese activity data, with weak retail sales and investment offset somewhat by stronger industrial production. Copper is also pressured by fresh deliveries into LME warehouses signalling easing supply tightness. 3M LME copper trades on either side of USD 14k/t in a USD 13,985.85-14,083.68/t range.
• Half of Russia’s leading diesel-producing refineries have reduced output following drone strikes.
• Libya's oil and gas minister said they plan to raise nat gas production to 4bln SCFD within 3-5 years.
• EPA Administrator said the US is proposing to rescind all major greenhouse gas emission standards for all power plants.
• Oman November OSP for November delivery set at USD 128.48/bbl.
• China Steel Association said it condemns overproduction and urges controls and urges for supply-side remedies, and strictly enforces output controls.

Central Banks

• ECB staff committee urged for clarification whether President Lagarde will leave before the end of the term, warning that prolonged uncertainty risks damaging trust in the institution, according to FT.
• NBP's Zarzecki said there's minimal room for Polish rate changes until end-2026.

Geopolitics: Iran

• Iranian Parliament Speaker Ghalibaf said Iranian forces have full control of the Strait of Hormuz and will prevent enemy vessels from crossing.
• Iran's top security official Rezaei said don’t get distracted by the US President’s mixed signals from 'no negotiations' to 'we’re ready to talk', while he added that stakes around oil and the straits have changed, damage control won’t stop what’s coming, and there will be no talks until Iran's conditions are met, period!
• Iran's Foreign Minister Araghchi held a phone call with Lebanon's House of Representatives Speaker Berri and discussed the need to strengthen coordination to confront Israel's efforts to ignite wars against Lebanon and countries in the region. Araghchi stressed Iran's keenness to preserve Lebanon's national sovereignty and territorial integrity in the face of Israeli aggression, while he affirmed Iran's full support for the proud Lebanese resistance in the face of Israeli occupation and aggression.
• UKMTO said they received a delayed report of an incident in the Strait of Hormuz, stating that a vessel has been struck by an unknown projectile.
• UN Security Council will hold an emergency meeting on Tuesday regarding developments around the Bab Al-Mandab Strait, according to Fars News Agency.
• Iranian Foreign Minister Araghchi held talks with the leader of Iraq’s Patriotic Union of Kurdistan (PUK).

Geopolitics: Ukraine

• Sources cited by Russian press said US President Trump's statement on an energy truce is "an impromptu move", and that no decision was made on an energy truce in the latest talks in Moscow between the US delegation and Russian President Putin.
• Russia Foreign Minister Lavrov said that the US has never offered concessions to Russia over the Ukraine conflict in exchange for Moscow’s assistance in resolving the Iranian issue, Interfax reported. Furthermore, Lavrov said Russia is ready for reasonable compromises on Ukraine.
• Russia Foreign Minister Lavrov plans to meet US Secretary of State Rubio on the sidelines of the UN General Assembly in New York, RIA reported.
• Ukraine President Zelensky said Ukrainian forces made new gains at the Syzran refinery and struck a UAV production facility in Taganrog, a UAV preparation and launch base in the Oryol region, and targets in the Black Sea
• NATO military jets were scrambled in Lithuania due to a drone near Vilnius and a military fighter jet shot down the drone in Lithuanian airspace, according to the National Crisis Management Centre.
• A Russian presidential aide warned that if Poland enters a war against Russia, Moscow would use its entire military arsenal.

US Event Calendar

• 8:30 am: United States Sep Empire Manufacturing, est. 15, prior 20.6

DB's Jim Reid concludes the overnight wrap

As I continue to bravely soldier on through manflu, markets have started the week with a few notable coughs and splutters as inflationary fears and talk of an AI slowdown have led to a difficult 24 hours. Although the weekend talk was all about AI, the broader market driver was a fresh rise in energy prices, with Brent crude (+1.02%) closing at $105.68/bbl, and back above $107 this morning, while European natural gas futures (+3.83%) hit their highest since 2022. So that pushed bond yields to multi-year highs, and we even saw the 10yr Treasury yield (+2.0bps to 4.99%) move above 5% in trading for the first time since 2023. It's back above that level in Asia as I type. The 5% threshold alone would have been a newsworthy day, but we simultaneously saw a huge slump for chip stocks given the AI slowdown headlines, with the Philly semiconductor index (-5.86%) posting its worst day since July. So it was another session where September lived up to its reputation as the worst month of the year for asset performance, with bonds and equities continuing to struggle. Today we'll hear from US Treasury Secretary Bessent in his testimony to the House Financial Services Committee. It'll be interesting to see if he tries to lean in some credible way against the rising tide of bond yields.  

Before this, geopolitical headlines were the biggest factor behind yesterday’s selloff. In part, this followed Friday night's closure of Saudi Arabia’s east-west pipeline, which acts as an alternative to the Strait of Hormuz. There was hope this was largely precautionary, but the Associated Press reported officials yesterday who said the repairs could take 3-5 weeks. So with another supply route taken out, that added to fears about a lengthier period of disruption. In addition, as we discussed yesterday morning, the meeting between Iran and other Gulf nations about a temporary shipping lane in the Strait of Hormuz scheduled for Monday was postponed on Sunday. We don’t have the exact details, but Bloomberg reported that a source had suggested this was partly because of Saudi Arabia’s frustration at Iran-backed groups continuing attacks on its territory. So that dampened hopes about traffic resuming through the Strait of Hormuz anytime soon. 

We did see a decent turnaround later in the session after President Trump posted that Russia and Ukraine had agreed to halt their strikes on energy targets and made a series of posts about Iran, including that it “wants to make a deal, quickly and badly”. It later appeared that any Russia-Ukraine deal on energy strikes was not actually agreed yet, with Ukraine’s President Zelenskiy acknowledging a “strong US proposal” while saying that Ukraine would suspend its strikes if Russia were to stop attacks on Ukraine’s “energy facilities, critical infrastructure and food supply routes”. Still, with Trump’s posts suggesting an increased sensitivity to higher energy prices, and with Iran’s ILNA citing Pakistani sources that the US was seeking a “step-by-step” agreement with Iran, the rise in oil lost some of its steam.

All that meant energy prices extended the large gains we saw last week but closed well off the day’s highs. For instance, Brent crude (+1.02%) settled at $105.68/bbl by the close, after trading as high as $109.80 at the start of the US session, while WTI was +1.34% higher to $101.39/bbl. Brent is another +1.54% higher this morning at $107.31, still comfortably off yesterday's highs but creeping back towards it. Over the other side of the pond, front-end European natural gas futures were up another +3.83% yesterday to a post-2022 high of €82.60/MWh.

That backdrop of building inflation meant investors priced in a growing chance of a full-blown hiking cycle for the months ahead. Indeed, the probability of a Fed hike tomorrow was up to 92% by the close last night, from 88% at the end of last week. And looking further out, 90bps of hikes are now priced by the June 2027 meeting, up +2.0bps on the previous day. That contributed to a fresh surge in Treasury yields across the curve, with the 10yr yield briefly moving above 5% for the first time since 2023. Yields did then turn lower, helped by Trump’s post on the energy strikes, but a late sell-off still saw yields end the day at their highest levels since autumn 2023. Ultimately, the 10yr yield (+2.0bps) closed at 4.99%, while the 2yr yield (+3.4bps) saw a larger rise to 4.66%. As mentioned at the top 10yr yields are now back above 5% in Asia, trading at 5.02% as I type. 

Over in Europe the fixed income sell-off was more consistent given the continent’s bigger exposure to higher energy prices. Moreover, a hawkish shift in ECB pricing drove a big selloff at the front end in particular. So among others, Germany’s 2yr yield (+6.8bps) jumped to 3.26%, the highest since September 2023, and the 10yr bund yield (+1.2bps) hit a post-2009 high of 3.51%. The larger front-end repricing came amid a larger rise in European inflation expectations, with the Euro 1yr inflation swap (+9.8bps) up to 3.60%, whilst the US 1yr inflation swap (+0.7bps) saw a marginal rise to 2.59%. Elsewhere in Europe, the 10yr OAT yield (+2.0bps) hit a post-2008 high of 4.47%, and here in the UK, the 10yr gilt yield (+2.4bps) hit a post-2007 high of 5.37%.

As all that was going on, there was a big selloff in chip stocks yesterday after the weekend calls for some kind of AI slowdown. So the Philly semiconductor index (-5.86%) had its worst daily performance since July. President Trump again pushed back against the prospect of an AI slowdown, as he had initially on Sunday, saying yesterday that the US already had “tremendous CRIMINAL and REGULATORY power over these companies!” And then in a separate post, he said that “the United States is leading, by a lot, every other country. Don’t kill the Golden Goose!” While this helped chip stocks recover a bit, they were back near the day’s lows by the close. That slump helped to drag US equities down more broadly, with the S&P 500 (-0.48%) seeing a decent fall, despite a narrow majority of companies in the index rising on the day. In Europe, the STOXX 600 (-0.49%) registered a similar loss.

Markets are lower again in Asia, but losses are relatively contained. As I check my screens, the S&P/ASX 200 (-0.89%), the KOSPI (-0.71%), the Hang Seng (-0.23%) and the Nikkei (-0.16%) are all in negative territory with mainland Chinese stocks just on the negative side. US equity futures are down a couple of tenths of a percent with European futures flat.

Early morning data showed that China’s industrial production grew 5.2% year-on-year in August, surpassing market expectations of 4.8% and accelerating from the 4.5% growth seen in July. The stronger-than-expected performance was largely supported by robust external demand, which continued to bolster export-oriented manufacturing despite broader signs of economic weakness. However, industrial production remained the lone bright spot in an otherwise challenging economic landscape. Fixed asset investment for the January-August period contracted by -7.2%, slightly worse than the -7.1% expected decline and deteriorating further from the -6.7% contraction recorded in the previous month. As a key indicator of both public and private capital expenditure in China, the metric has remained firmly in negative territory since April, highlighting persistent weakness in investment activity. Meanwhile, retail sales increased just +0.4% year-on-year in August, falling short of +0.8% expectations and slowing from the 0.6% rise seen in July. The data suggests that consumer spending in the world's second-largest economy remains subdued despite a series of stimulus and support measures introduced by Beijing.

Separately, China’s property sector continued to weigh on economic activity, with new home prices declining by -0.17% in August, nearly matching July’s -0.18% drop. The continued fall in housing prices underscores the ongoing challenges posed by the country’s prolonged real estate downturn.

Finally, there was very little data yesterday, although we did get Canada’s CPI print for August. That was exactly as expected, with headline CPI remaining at +3.0%, and the various core measures also in line with expectations. Against that backdrop, there was little change in market pricing for the Bank of Canada’s next meeting in late-October, with a 75% chance of a hike priced in by the close.
Looking at the day ahead, data releases include UK unemployment for July, the German ZEW survey for September, and the US Empire State manufacturing survey for September. From central banks, we’ll hear from the ECB’s Escriva and Cipollone. Otherwise, US Treasury Secretary Bessent will be testifying before the House Financial Services Committee.

Tyler Durden Tue, 09/15/2026 - 08:31

Will Trump Accounts Make Every Kid A Millionaire?

Authored by Paul Mueller via The Daily Economy,

No - or at least, not by the time they finish high school.

Depending on how they're funded, a Trump Account could turn a child into a decamillionaire by retirement, or it might just be worth about $4,300 on their eighteenth birthday. As with any account, three variables dictate the outcome: contributions, rate of return, and time.

What might Trump Accounts actually be worth for children born this year? A thousand dollars takes a very long time to become a million dollars. That initial thousand dollars for children born during this administration could grow to be $4,342.45 (8.5 percent annual return), $5,122.17 (9.5 percent annual return), or $6,032.83 (10.5 percent annual return) by the time they turn 18. That's nice, but not life-changing.

Does this mean Trump Accounts won't materially benefit a lot of kids? No. The magic of the numbers really comes from the basic principles of compound interest over long periods of time, not anything special or magical about the Trump Accounts themselves.

Extending the time horizon to retirement, however, is a different story. These Trump Accounts could be worth a lot if funded aggressively and left to compound over a lifetime. By the time a child born today reaches retirement age in 2093, that $1,000 seed money could be worth: $236,478.93 (8.5 percent annual return), $437,266.28 (9.5 percent annual return), or a whopping $804,030.69 (10.5 percent annual return).

Currently, Trump Accounts are limited to $5,000 annually of individual contributions, but qualified general contributions do not count toward this. So Michael Dell's $6.25 billion gift of $250 per child toward 25 million accounts will not count against the $5,000 annual limit. The claim about Trump accounts creating millionaires only works if one assumes the money compounds at an above market rate until the kids retire at age 67, or that they receive thousands of dollars of contributions into their account while children.

Maxing out the annual contributions ($5000/year, $90,000 over 18 years), however, will deliver impressive results. By the time they turn 18, those children will have a substantial endowment of $200,957 (8.5 percent), $222,078 (9.5 percent), or $245,691 (10.5 percent) depending on their rate of return. Extend that another 50 years or so to retirement and we are talking real money: ~$11 million (8.5 percent), ~$19 million (9.5 percent), or ~$33 million (10.5 percent).*

These calculations don't account for inflation. Prices may be three and a half (2 percent annual inflation) to seven times (3 percent annual inflation) higher in 67 years. So that eye-popping number of $33 million (which will not be a common outcome) may only be worth the equivalent of $4 to $10 million in today's dollars. While 10.5 percent is the historical long-term average annual rate of return for the S&P 500, it can vary quite a bit year to year and even decade to decade. More importantly, most children will not see maxed-out annual contributions to their accounts every year.

Becoming a decamillionaire requires $5,000 contributions per child annually for 18 years - no small feat for most people. One of the architects of Trump Accounts, Brad Gerstner, however, believes that hundreds of billions of philanthropic dollars will flow into these accounts every year. Plus, these accounts may serve as a focal point for family and friends who want to contribute to children's long-term prosperity - much as grandparents of an older generation would give long-term Treasury bonds to their grandkids.

But there were already tax vehicles to invest money for your own kids, like 529 education savings accounts. Trump accounts were created to facilitate broad-based direct-transfer philanthropy. Billionaires now have a mechanism for giving money directly to millions of people without government officials or NGOs taking a big cut. The distribution of the Dells' gift just hit children's accounts this week.

Will there be widespread adoption of Trump accounts, and will people contribute to them regularly? Less than a month after the rollout, Secretary Bessent said over seven million children were enrolled - a promising start. Will billionaires contribute significant amounts of their wealth to millions of kids through Trump accounts? Michael and Susan Dell's $250 per child gift, matched by Gerstner in Indiana and Dalio in Connecticut, has become a reality. And will Trump accounts provide a viable alternative to currently unsustainable entitlement programs like Social Security? These are a few very important questions that will determine how much Trump accounts impact American society.

It's true that Trump accounts, should they be held until retirement, could be worth impressive amounts of money, especially if people contribute every year their child is a minor. But 2093 is a long way off. Saving and investing for the far future is great. Parents will still have to decide whether sacrificing thousands of dollars today is worth tens or even hundreds of thousands of dollars in future decades.

*The account projections do not incorporate the program's permitted fund fees, which may be as high as 0.10 percent annually, per this White House explanation. Even a small fee matters over 67 years.

Tyler Durden Tue, 09/15/2026 - 08:05

BYD's EU Invasion Deepens Germany's Auto Industry Crisis

The rise of right-wing populism in Germany comes as globalist policies backfire and crush Europe's industrial powerhouse. The nation's auto industry is in shambles, with layoffs and production cuts, after European leaders had the brilliant idea of letting cheap Chinese EVs flood the struggling continent.

Bloomberg cites new data from Schmidt Automotive Research showing Chinese brands accounted for 10.7% of Western European car sales in the second quarter, up from 3.4% two years earlier, highlighting how BYD Motors's cheap $34,000 EV is quickly taking market share from domestic brands. 

Chinese EVs in the EU have seen quarterly registrations surpass those of Japanese brands. Citigroup analyst Harald Hendrikse estimates Chinese brands could capture 30% of the EU market by 2035 without additional protective measures. 

The immediate result of the flood of Chinese EVs on the continent has been restructuring news from Volkswagen that upwards of 100,000 jobs could be cut by the end of the decade. More recently, Jaguar Land Rover plans to cut 10% of its workforce. 

Beyond automakers, the ripple effect of layoffs is impacting parts supplier companies: 

European Auto Job Cuts

Auto Suppliers Job Cuts

Germany, previously resistant to tougher trade barriers, is preparing tariffs on Chinese hybrids as it watches its industrial base erode, stoking the rise of Alternative für Deutschland as German political elites betray working-class folks.

Protection could give domestic brands time to restructure. Still, China's dominance in batteries and rare earths gives Beijing potential means to retaliate, complicating Europe's effort to preserve its automotive industrial base.

The quick erosion of Europe's automotive industry is a national security risk for the continent because its factories, skilled workforce and supplier networks underpin the continent's capacity to produce weapons. At a time when the Russia-Ukraine war escalates and the Middle East conflict spreads, a diminished industrial base in Europe ahead of a much-needed rearmament supercycle is just bad news for EU defenses.

Tyler Durden Tue, 09/15/2026 - 07:45

Bloomberg Terminal Hikes Prices As Inflation Hits Wall Street's Data Bills

Bloomberg Terminal subscriptions will see a price hike starting Jan. 1, 2027, according to an email Bloomberg sent out early Monday.

Monthly subscription prices will increase by $140 per Terminal at locations with multiple licenses and $155 at locations with a single license. That's about a 3% price hike, or an additional $1,680 and $1,860 annually per subscription - ​​which range from $28,320 to $31,990 per year respectively.

Email: 

Existing subscriptions that renew on or before December 31, 2026 (and new Bloomberg Terminal subscriptions installed on or before the same date) will not see a price increase until their renewal date, as it occurs, in the following two years. 

Starting January 1, 2027, Bloomberg Terminal subscriptions will see a price increase of $140 per month per subscription for client locations with multiple licenses, and a price increase of $155 per month for client locations with a single license. When these increases take effect, they stay in place for two years. The average annual increase for the two-year term is 2.97%

"As always, we continue to invest in technology and talent to ensure we provide our customers with the highest quality products, services and support in the industry while adding enhanced capabilities," the email read.

Latest innovation on the Terminal .... a chatbot:

Bloomberg's price hike shows inflation continuing to pass through into market-data costs. It also strengthens the need for cheaper alternatives.

Tyler Durden Tue, 09/15/2026 - 06:55

Judge To Begin Consideration Of Bayer's $7.25 Billion Roundup Settlement

Authored by Troy Myers via The Epoch Times,

A circuit judge in Missouri is set to begin weighing on Sept. 14 agrochemical giant Monsanto's proposal of a $7.25 billion settlement for tens of thousands of lawsuits alleging that the company's popular Roundup weedkiller causes cancer.

Bottles of Roundup weed killer on a shelf at a Lowe's Garden Center in Burbank, Calif., on June 25, 2026. Justin Sullivan/Getty Images

Judge Timothy Boyer of St. Louis is not expected to issue an immediate ruling at the hearing, but he will examine Monsanto's lawyers' justification of the settlement as they seek Boyer's final approval, while some plaintiffs' attorneys argue that their clients should not be strong-armed into accepting the company's proposal.

The settlement, which was announced in February, is meant as a way to contain litigation.

It aims to resolve nearly all of the roughly 65,000 claims still pending in federal and state courts, and it's meant to cover future Roundup claims as well. The settlement received preliminary approval from Boyer on March 4.

As part of the settlement, the company would offer payouts for individuals who were exposed to Roundup and developed non-Hodgkin lymphoma. The exact award amount for each person would depend on different factors, including the severity of their cancer, their age when they were diagnosed, and whether they were exposed to the chemical at work or at home.

For occupation claimants - meaning farmers, gardeners, maintenance workers, landscapers, and more - their payouts could range from $60,000 to $165,000.

The agreement would also award residential claimants, referring to homeowners who use Roundup for their gardens, yards, and driveways. Payouts for this group could range from $20,000 to $40,000.

"Monsanto remains confident that the class settlement, which is supported by plaintiffs' counsel representing tens of thousands of potential class members, is fair to all parties, the objections have no merit, and warrants final approval following the September 14th hearing," the company said in an Aug. 28 statement.

Supreme Court's Involvement

Litigation against Monsanto, acquired by Germany-based Bayer in 2018, has plagued it for years, leading to one case reaching the highest court in the United States.

Individuals across the country have claimed that exposure to Monsanto's Roundup weedkiller, which contains a key and controversial ingredient called glyphosate, causes cancer.

Although the company has repeatedly denied any link between its products and cancer, there have been multiple instances of juries throughout the country awarding plaintiffs millions of dollars.

One of those cases involved Missouri man John Durnell, who was diagnosed with non-Hodgkin lymphoma after exposure to Roundup.

He had previously won $1.25 million in his lawsuit against Monsanto, with a Missouri jury agreeing that the agrocompany failed to follow a Missouri state law requiring a warning for risks such as cancer.

But Monsanto appealed the decision, and eventually it came before the Supreme Court. The company called that prior verdict flawed because of a legal doctrine known as preemption, which holds that federal law overrides state law when the two are in conflict.

Monsanto said the federal government, through the Federal Insecticide, Fungicide, and Rodenticide Act, had already regulated its Roundup product and glyphosate. The Environmental Protection Agency (EPA), under that law, approved glyphosate's use and has never required additional labeling related to cancer risks.

The justices, in one of the most consequential decisions from its last term, ruled 7-2 on June 25 in favor of Monsanto, holding that federal law does indeed preempt Missouri's state law, thus throwing out the basis of the lower court's verdict for Durnell.

Following the ruling, Bayer CEO Bill Anderson said the company would continue to pursue the $7.25 billion settlement.

Bayer already paid a $10 billion settlement in 2020 that resolved many Roundup cases but had left the company open to future claims.

Glyphosate Controversy

For years, health advocates have accused the key ingredient of Roundup - glyphosate - of being a cancer-causing chemical.

The EPA registered glyphosate as a pesticide in 1974, and it has since become one of the most widely used chemicals in the world for agriculture production.

As its use over time increased, so too did claims that exposure to glyphosate caused cancer.

The World Health Organization's International Agency for Research on Cancer published a March 2015 review that found the chemical as "probably carcinogenic to humans."

The Trump administration backed Monsanto in the Supreme Court case, filing a brief that urged the justices to rule favorably for the company.

In a Feb. 18 executive order, President Donald Trump said glyphosate was critical to national defense and instructed his administration to ensure that there was an adequate supply.

"Lack of access to glyphosate-based herbicides would critically jeopardize agricultural productivity," the order read. "Glyphosate-based herbicides are a cornerstone of this Nation's agricultural productivity and rural economy."

This caused a rift among the Republican base, as proponents of the Make America Healthy Again, or MAHA, movement became increasingly frustrated with the federal government's support of glyphosate.

Health Secretary Robert F. Kennedy Jr., one of the movement's champions, had previously helped secure a $289 million award from Monsanto in 2018 for a client who alleged that Roundup caused him to develop non-Hodgkin lymphoma.

But following Trump's executive order, Kennedy released a statement that appeared to balance support for glyphosate in securing the country's food supply in the short term and the need to shift away from the chemical over time.

"Pesticides and herbicides are toxic by design," Kennedy wrote in a Feb. 22 post on X. "Unfortunately, our agricultural system depends heavily on these chemicals. ... I support President Trump's Executive Order to bring agricultural chemical production back to the United States and end our near-total reliance on adversarial nations."

He stressed that Trump did not build the current system - he inherited it - and that there are ongoing efforts to shift away from harmful agricultural methods.

Two months before the Supreme Court ruling in favor of Monsanto, Kennedy testified in Congress.

Sen. Brian Schatz (D-Hawaii) asked the health secretary whether glyphosate caused cancer, and without hesitation, Kennedy responded, "Yes."

"I would say it's important to minimize consumption of glyphosate as much as possible," Kennedy said.

Tyler Durden Tue, 09/15/2026 - 06:30

It's Time To Talk About The Shitting...

Authored by Steve Watson via Modernity News,

The "enrichment" we were sold was cuisine, music and vibrant street life. What arrived, in town after town, is a sanitation standard the UN still spends billions trying to wipe out of third world nations.

Open defecation is not a Western urban myth. WHO and UNICEF still count hundreds of millions of people doing it in fields, ditches and open ground. Nigeria sits near the top of the league table. India, despite a national toilet-building drive, still records tens of millions.

When you import the people at scale and refuse to enforce the most basic public standards, you import the habit. The footage is now so routine it has become a genre.

The picturesque village of Broxtowe, Nottinghamshire, has been blessed with the kind of diversity that was only previously seen in London:

Africans defecating in residential streets in the middle of the day ?? pic.twitter.com/GrR5FPCIx3

— Rare | ???? (@RareRestore) August 31, 2026

A children's park is next. Nothing says community cohesion like a man treating a playground as an outdoor latrine and finishing the job by hand.

A man defecates in a children's park. He uses his hand to clean himself. pic.twitter.com/BEcggkUlAq

— David Atherton (@daveatherton) September 6, 2026

Truly, the contribution to British civic life is immeasurable.

Notting Hill Carnival has been doing this for years. A resident's doorbell captured carnival-goers treating her property as a trench for shitting and pissing all day. Some even apologised to the camera. Sadiq Khan's London treats the event as a celebration.

This London Resident used her Ring Doorbell Cam to capture dozens of Notting Hill Carnival Goers pissing & shitting on her property all day.

Some even apologised to the camera ??

Sadiq Kahn likes to celebrate this for Londoners. pic.twitter.com/qnXi0HGGtd

— Concerned Citizen (@BGatesIsaPyscho) September 1, 2026

Susan Watts, 69, recorded dozens of people using the space by her front door after earlier carnivals and told the Daily Mail the stench left it "like being in a filthy toilet." The council quoted her £75 to jet-wash a private area. Dignity, it turns out, has a surcharge.

THIS IS ENGLAND TODAY. IMPORT THE THIRD WORLD, BECOME THE THIRD WORLD. GOD HELP US ALL ???? pic.twitter.com/zAS3RAMXlI

— aileen B ????????? (@AileenBart60380) August 27, 2026

Oxford Street is London's main retail drag. When you have to put up signs telling adults not to defecate on it, the experiment has already failed.

This is displayed on Oxford St. London's main retail thoroughfare. When you have to put up signs saying "don't shit here" something has gone badly wrong. pic.twitter.com/ZviMfaX0on

— m o d e r n i t y (@ModernityNews) February 21, 2026

I think this was seen on Oxford Street? I was shocked- l lived in London for 15 years until mid 1990s and never saw anyone shitting in the street far less posters forbidding it.

— Cait Mercer (@MercerCait) February 21, 2026

Birmingham now has the same notices.

UK: ??

SHAMEFUL Defecating in the streets is prolific in Birmingham.

It has been said that Britain of old was paved with gold.

Ever since we've been invaded, our streets are paved with SHIT.

Don't be fooled, if our cities were still safe and proud, there would be no need... pic.twitter.com/3jrAq0ua4T

— Rogue (@RogueUnfiltered) June 1, 2026

The NHS gets it too. An intoxicated man who has already fouled himself refuses to leave A&E. Staff time, corridor space, and public patience all redirected to a problem that starts with the same refusal to use a toilet.

?INTOXICATED MIGRANT REFUSES TO LEAVE A&E HOSPITAL AFTER PISSING & SHITTING HIMSELF ?

?THIS IS WHY THE NHS IS ON ITS ARSE - ABSOLUTE STATE OF IT! pic.twitter.com/8xZIPGHEMs

— Gauci Reports (@GauciReports) November 15, 2025

Spain and Italy get the same treatment.

Muslim migrant shitting in the streets in Ceuta Spain ?? ?

Welcome to the Islamic enrichment of Europe ? pic.twitter.com/PzK8LF9SdR

— CanadianExMuslim (@ExMuslimAz) July 31, 2026

A drinking fountain in Spain with the tap used as an anal bidet, on a fixture children drink from.

Migrant washes his ass at a drinking fountain in Spain which kids use to drink. Sources confirm the tap was wedged in between his buttcheeks. Diversity is our strength! ? https://t.co/Uwoc8hwgAl

— Mark Johnson (@Mark_Johnson80) September 11, 2026

Rome, once the capital of a vast empire, now the toilet of the world.

Migrant openly shitting on the street.

Rome, Italy.

pic.twitter.com/fel6WSqCTg

— Canadian Patriot (@PPC4Liberty) May 23, 2024

Canada is not spared.

Cultural enrichment in Canada means you get to deal with public defecation. pic.twitter.com/nstSF6Jjdw

— Ian Miles (@ianmiles) September 14, 2024

Vancouver's own figures are not a vibe. City data and CTV reporting put faeces removals in the first two months of 2025 at 1,870. 2023 saw 19,900 collections. 2024 still logged 17,670.

#REPORT: Vancouver residents are calling for action as "public defecation in the city reaches new heights," with 1,870 human feces removals taking place in the first two months of 2025 alone. pic.twitter.com/NsuPTFppVk

— Canada Proud (@WeAreCanProud) May 7, 2025

Business groups run "Poop Fairy" patrols because the municipal programme is too slow.

?NEW

Video surfaces of a bus in Brampton being put out of commission

after someone took a ? on the bus

Why is public defecation 'exploding' in 2025?pic.twitter.com/ElQoE447YZ

— Tablesalt ???? (@Tablesalt13) October 22, 2025

The Nigerian government has spent years running campaigns begging its own citizens to stop doing this in public. Billboards, World Toilet Day speeches, a "Clean Nigeria: Use the Toilet" drive. Vice President Kashim Shettima said access to toilets is "about dignity, health, and safety."

Nigerian government in their desperate attempt to stop public defecation has launched a campaign urging #Nigerian man to stop defeacating in public. pic.twitter.com/QOo5QPup0L

— PSAFLIVE (@PSAFLIVE) November 13, 2022

UNICEF has repeatedly placed Nigeria among the world's worst for open defecation, with tens of millions still practising it.

India remains in the same conversation even after Swachh Bharat. The habit did not vanish because a plane ticket was purchased.

Public Defecation - Is a major problem in countries like INDIA and NIGERIA. pic.twitter.com/0PUJETequ5

— Cornbread Mafioso ?? (@Soulful1865) June 13, 2024

The historic town of Cambridge in the UK has already taken the next logical step: if the arrivals prefer squatting and shitting all over the floor, the host city will install facilities to enable just that. Labour-run Cambridge City Council spent nearly £1 million on a Silver Street toilet block that includes squat-style cubicles "preferred by some international visitors," then charges £1 to use them.

Resident Heather Boyd told the BBC: "I certainly think if I'm going to spend £1, I'm not going to squat as well. That is absolutely crazy." Britain spent centuries perfecting the flush toilet. Now taxpayers are paying in order for the third world to squat into a hole.

How culturally enriching. How much these individuals are contributing. The GDP of public health risk, the tourism brochure of a high street that needs pictograms of a squatting figure with a red line through it.

If Trafalgar Square's Fourth Plinth is meant to reflect London and the UK as it really is, Here's the next statue:

The Gentleman In Blue (Shitting In The Street) - Commissioned by the late Professor Jason Arday. pic.twitter.com/CQptIew9HY

— Mcgregor Mackenzie ??????? (@mcgregormackenz) September 11, 2026

Still, it could be worse. And it is.

Tyler Durden Tue, 09/15/2026 - 05:00

These Are The European Countries With The Newest Cars

Europe’s roads reveal a striking divide between countries where drivers regularly replace their vehicles and those where aging, secondhand cars remain the norm, according to a new report from ecarstrade.com. 

New research from B2B automotive company eCarsTrade compared vehicle fleets across more than 30 European countries and found Luxembourg sitting comfortably at the top of the rankings for the continent’s newest cars.

Nearly 43% of Luxembourg’s registered vehicles are less than five years old, the highest proportion in the study. At the other end of the age spectrum, only about 6% of its cars have been on the road for 20 years or longer. The country also replaces vehicles unusually quickly, with its annual fleet renewal rate topping 10%. Roughly 7% of Luxembourg’s cars are now fully electric.

Belgium ranked second. More than one-third of its cars are less than five years old, while the country added roughly 456,000 new vehicles in 2024. Its fleet renewal rate is about 7.5%, among the strongest in Europe. Electrification is also becoming more prominent: roughly 5% of Belgium’s total fleet is electric, while EVs account for around 28% of new registrations.

Denmark placed third, with approximately 28% of its cars less than five years old and only around 6% at least 20 years old. But Denmark stands out even more when it comes to the transition toward electric vehicles. More than half of new vehicles sold there are fully electric, and battery-powered cars already account for roughly 12% of the country's entire fleet.

The United Kingdom came in fourth. Britain has an especially small population of very old cars, with fewer than 5% of vehicles aged 20 years or more, the lowest share measured in the study. Nearly 2 million new cars were registered in 2024, helping keep the country's annual fleet renewal rate near 6%. EVs represented about 19% of new registrations, although they still make up a relatively small share of all vehicles currently on British roads.

Norway rounded out the top five and remains Europe's standout when it comes to electrification. More than 27% of all Norwegian cars are fully electric, by far the highest share among the countries examined. Even more striking, roughly 88% of new vehicles purchased in Norway are electric. That means the country's existing fleet is rapidly being transformed as older gasoline and diesel vehicles are gradually replaced.

Behind the top five were Liechtenstein, Austria, Germany, Switzerland and the Netherlands. Germany, for example, has roughly 30% of its fleet under five years old, while Switzerland is closer to 25%. The Netherlands has a somewhat older fleet overall, despite having a relatively healthy market for newer vehicles and EVs.

The report says that the opposite extreme can be found in Albania. According to the research, roughly nine out of every 10 vehicles there are at least a decade old, giving Albania the oldest fleet among the countries examined. The disparity highlights a broader economic divide in European car ownership: wealthier Western and Northern European countries generally replace vehicles more frequently, while parts of Eastern and Southeastern Europe rely much more heavily on older vehicles and secondhand imports.

That distinction can also make registration statistics somewhat misleading. A vehicle being registered in a country for the first time does not necessarily mean it is a new car. Used cars exported from countries such as Germany and France frequently enter fleets elsewhere in Europe as newly registered vehicles despite already having years of driving behind them.

“There’s a very clear split across Europe when it comes to car ages,” an eCarsTrade auto industry expert said. “Western countries keep replacing their fleets regularly, partly because incomes are high enough to realistically afford new vehicles.”

The researchers pointed specifically to Romania, Poland and Albania as markets where imported secondhand vehicles play a much larger role. As a result, the underlying age of some national fleets may be even greater than headline registration figures initially suggest.

The study, conducted in August 2026, compared more than 30 European countries using three primary measures: the percentage of cars at least 20 years old, the percentage at least 10 years old, and the percentage less than five years old. Those variables were combined into a Fleet Age Score ranging up to 100, with lower scores indicating newer national fleets.

Luxembourg recorded a score of just 1.6, well ahead of Belgium at 13.1 and Denmark at 17.1. The UK scored 18.8 and Norway 18.9, followed by Liechtenstein at 19.6, Austria at 20.8, Germany at 20.9, Switzerland at 23.7 and the Netherlands at 24.1.

Taken together, the numbers show that Europe is not moving toward a newer or more electric vehicle fleet at anything close to a uniform pace. In Luxembourg, frequent vehicle replacement keeps the average car relatively young. In Norway and Denmark, electrification is rapidly reshaping what people drive. Meanwhile, countries that depend heavily on imported used vehicles continue to operate fleets that can be dramatically older than those found just a few hundred miles away.

Tyler Durden Tue, 09/15/2026 - 04:15