Hantavirus-Plagued Cruise Ship Begins Evacuations

Early Sunday morning, the Dutch-flagged cruise ship MV Hondius, anchored off Spain's Canary Islands, began evacuating passengers after a deadly hantavirus outbreak triggered a multinational public health response and put global health authorities on red alert.

"The docking took place at 6:30 a.m. and has been a success in spite of all the adversities," Health Minister Mónica García said in a statement quoted by Bloomberg News.

Health officials have found that "all passengers are asymptomatic," García added.

The U.S. government is evacuating American passengers from a cruise ship tied to a deadly hantavirus outbreak. A CDC team is currently in the Canary Islands assessing potential exposure and monitoring needs.

Passengers will be flown back to the U.S. on a medical repatriation… pic.twitter.com/CSrpbpMXLR

— Breaking911 (@Breaking911) May 10, 2026

Ship-tracking data show that the Hondius was anchored in Granadilla Port, Tenerife, and has since docked.

Last week, the World Health Organization identified eight hantavirus cases linked to the cruise ship: five suspected and three confirmed by laboratory testing. This includes three deaths. There were 149 passengers and crew members on the ship before the evacuation.

The outbreak appears to have started after a Dutch man and his wife traveled in South America, then boarded the Hondius in Argentina on April 1. Both died weeks later.

The New York Post identified patient zero as ornithologist Leo Schilperoord, who was on a multi-month birdwatching trip in South America with his wife, Mirjam Schilperoord. Both died.

Hantavirus is typically spread through rodent droppings or contaminated dust. People can inhale contaminated particles when rodent waste is disturbed. Symptoms may take weeks to appear, making containment and monitoring difficult.

On Friday, President Trump was questioned by reporters about the virus-plagued cruise ship. He said the situation is "very much under control."

Polymarket odds of a hantavirus pandemic have remained under 10% for the last several days.

//--> //--> Hantavirus pandemic in 2026?
Yes 7% · No 93%
View full market & trade on Polymarket

We questioned at the end of last week whether the vaccine stock trade was back, with Moderna conveniently announcing it was working on a vaccine.

The story count for "pandemic" in Bloomberg news stories remains well below the highs of the Covid-era mass hysteria driven by corporate media.

Will WHO create mass hysteria? That is the question.

Tyler Durden Sun, 05/10/2026 - 12:50

Housing Market's Crucial "Spring Selling Season" Is In Tatters

Authored by Wolf Richter via Wolf Street,

Late last year and early this year, the story was that dropping mortgage rates, powered by big rate cuts from the Fed, would unleash demand in the housing market in the spring – the key spring selling season – and that sales volume would take off and that Realtors’ commissions would rocket to the moon.

And so that didn’t happen. Inflation has been reheating for months before the war and before the energy price spike. The energy price spike in March and April then added to that resurgence of inflation. The Fed is now talking about a possibility of rate hikes as next move. And longer-term Treasury yields, such as the 10-year Treasury yield, rose in March and April in response to inflation fears. Mortgage rates, which track those Treasury yields but are higher, rose back to the 6.5% range. And the housing market remained in the same-old-same-old frozen pattern that it has been in for four years after the price explosion from mid-2020 through mid-2022. And it continued in the latest week.

Mortgage applications to purchase a home – a measure of demand that may become actual home sales in the future, so a forward-looking indicator of home sales – dipped in the current survey week and remained near rock-bottom levels, down by 34% from the same week in 2019, according to data by the Mortgage Bankers Association today. That level of mortgage applications is below even the collapse of mortgage applications during the lockdown in the spring of 2020.

The average weekly mortgage rate for conforming 30-year fixed mortgages rose to 6.45% in the latest reporting week, according to the Mortgage Bankers Association today.

For the past 7 weeks, this measure of mortgage rates has been back in the middle of the 6-7% range, the range it has been in since September 2022, except for some breakouts to the upside.

These mortgage rates are not high in a historical context; they’re only high in the context of the Fed’s QE which started in 2009 and took on mega-proportions during the pandemic.

Under its QE programs, the Fed bought trillions of dollars of securities, including mortgage-backed securities (MBS), which repressed mortgage rates below 3%. But this massive amount of reckless money printing was part of the toxic mix at the time that triggered the worst inflation in 40 years. With mortgage rates below 3% and inflation at 9% – negative “real” mortgage rates, better than free money – home prices exploded and are now too high. And that inflation has refused to go back into the bottle.

Pending home sales for March – deals that were signed in March but haven’t closed yet – also remained at rock bottom, down by 30% from March 2019. In January, they’d dropped to a record low in the data by the National Association of Realtors going back to mid-2010, and in February and March, they inched up from that record low.

And the much-hyped spring selling season has turned into the fourth dud in a row: 2023, 2024, 2025, and 2026.

Mortgage applications to refinance a home instantly react to even small changes in mortgage rates. A dip in mortgage rates unleashes homeowners like a coiled spring to refinance a mortgage at even a slightly lower rate. And when mortgage rates rise after that dip, demand re-fizzles. These dynamics have been repeated several times since mid-2024.

Refis do nothing for the housing market, though they’re crucial for the income of mortgage brokers and lenders. But they may have a positive impact on consumer spending when they lower the mortgage payments and leave borrowers more money to spend on other stuff; or when they’re cash-out refis, the proceeds of which might then be used to pay down more expensive debts, or might be used for spending projects.

The up-front fees to be paid by homeowners when they refinance a mortgage – typically 1% of the mortgage balance – are generally added to the loan amount where they’re largely out of sight but increase the payment, which reduces the advantage of lower mortgage rates.

Homeowners can do a breakeven analysis with online calculators or through brokers and mortgage lenders, to see if refinancing a mortgage is worth it. When mortgage rates briefly drop and the breakeven analysis tilts their way, they pull the trigger, thereby creating these curious spikes in refis.

But even these spikes in refis since mid-2024 were relatively low compared to the two-year refi boom from early 2020 through 2021 when the Fed’s QE repressed mortgage rates below 3%, and everyone and their dog refinanced into these low-rate mortgages.

And now they’re part of the “lock-in effect,” when these homeowners avoid buying a new home, and thereby selling their current home, because the new home’s much higher price would have to be financed at a much higher mortgage rate, and that math doesn’t work very well for many people. But life does happen. My analysis: Update on the “Lock-in Effect” in the Housing Market: Below-3% & 4% Mortgages Fade Very Slowly

This longer view demonstrates the inverse relationship between mortgage rates (blue) and applications to refinance a mortgage (red):

In case you missed it: New Single-Family Home Prices Drop Further amid Inventory Glut. But Lower Prices Beget Higher Sales

Tyler Durden Sun, 05/10/2026 - 12:15

Soaring Death Toll In Lebanon As Full-Fledged Israel, Hezbollah Fighting Returns

Full-fledged war has returned to Lebanon as the government has announced that at least 23 people have been killed by Israeli airstrikes on Saturday alone. 

Stretching back into Friday, this brings the total death count to at least 50 killed over the past 24 hours of Israeli bombings, also as Lebanon’s National News Agency (NNA) late on Saturday said rescue operations were still ongoing for bystanders missing underneath the rubble.

Illustrative prior image: Getty

Heavy bombing has not ceased in southern Lebanon, as the Israeli military says it's trying to root out and destroy Hezbollah, including raids on the districts of Nabatieh, Bint Jbeil and Sidon, among others. Several were also killed in Tyre on Friday.

But Israeli forces have also absorbed casualties, with The Times of Israel describing the following serious drone strikes launched from Lebanon:

On Saturday, the terror group launched several salvos of explosive-laden drones and rockets at Israeli forces. One drone struck Israeli territory, close to the border with Lebanon, seriously injuring a reservist soldier and moderately wounding a reservist officer and another reservist soldier.

The troops were taken to Galilee Medical Center, which said the seriously wounded soldier underwent surgery and was now stable in the intensive care unit. The moderately wounded troops were scheduled for surgery later.

In another incident, the military said an explosive drone struck an unmanned engineering vehicle in southern Lebanon, causing damage. No injuries were caused.

There are reports of the IDF issuing evacuation orders for various areas, only to attack the so-called safe zones. For example the below comes via Israeli sources:

"In light of the Hezbollah terror organization’s violations of the ceasefire agreement, the IDF is forced to act against it with force and does not intend to harm you," warned army spokesman Col. Avichay Adraee.

Meanwhile, Lebanese media reported that Israeli airstrikes on Saturday killed at least 12 people, including in areas where no evacuation orders were issued.

Starting in late April a 10-day ceasefire brokered by Washington took effect, even as Israeli forces remain deployed in a strip of Lebanese territory several miles deep along the border. That appears to be effectively collapsed, also as Israel has been upping its targeting of Beirut suburbs of late.

Israel calls the Lebanese strip of land now occupied by IDF troops a 'buffer zone' - but Lebanon sees it as a land grab. Lebanese Parliament Speaker Nabih Berri, a Hezbollah ally and leader of the Amal Movement - which is the other big Shia organization in Lebanon - has recently stated that if Israel "maintains its occupation, whether of areas, positions, or by drawing yellow lines, it will smell the scent of resistance every day." He added: "If they insist on remaining, they will face resistance, and our history bears witness to that."

Israeli airstrikes on vehicles south of Beirut killed 4 people, while strikes in southern Lebanon killed at least 13, state media and the Health Ministry said.

Iran war: https://t.co/GEBscM5Zz2 pic.twitter.com/6mHpjCkVis

— Sky News (@SkyNews) May 9, 2026

Lebanese officials have also charged Israel with trying to erase the Lebanese presence in southern Lebanon in a genocidal act, or 'cultural genocide'.

This after Israeli forces have carried out demolitions in southern villages, targeting what they describe as Hezbollah infrastructure embedded in civilian areas.

Tyler Durden Sun, 05/10/2026 - 11:40

Winning? Do We Need To Understand UBI

Submitted by Peter Tchir of Academy Securities

Winning? Do We Need To Understand UBI

Iran (and the potential for a deal) has continued to move markets. As the 30-year bond rose above 5% earlier this week, we got news that we have a new approach to resolving the conflict – a one-page MOU. Markets (ex-oil) rallied around various “deal” headlines all week.

Spider, Bret, and I spent some time discussing this on Friday’s Podcast – The U.S. Proposal to End the War (also available on Spotify and iTunes).

Information continues to leak out in dribs and drabs about how those negotiations are doing. There continue to be conflicting messages. In the back of my mind, I’m increasingly forced to remember what we mentioned at the start of the conflict – Iran has never won a war but has never lost a negotiation.

There was a time when that statement didn’t seem likely to be reflective of this conflict. From “unconditional surrender” to various other metrics (especially surrounding nuclear weapons capabilities) we seem to be drifting to – let’s open the Strait and figure out the rest later?

The U.S. has displayed exceptionalism on every military task that it has been asked to undertake during this conflict. While we have had a limited presence in the Strait, our maritime efforts have been successful in accomplishing the missions that have been defined. Yes, Project Freedom was short lived. Not so much because the U.S. couldn’t deal with the threat (we successfully defended ourselves against Iranian missiles, drones, and small boats), but because it became pretty clear that not many commercial vessels were ready, under current circumstances, to risk challenging Iran.

We did argue, earlier in the week, that the admin’s assertion that Iran only has a few weeks before its economy collapsed, was underestimating the Iranians. They in all likelihood have prepared for this economic pressure and likely have significant IOUs with countries like China (and possibly even crypto holdings) to survive months not weeks. A regime that will shoot 40,000 or more citizens in a week for protesting is not going to be overly concerned with “standard of living” issues. Finally, all the “hype” around the fact that Iran’s ability to store oil is running out and this is causing them to shut the pumps (resulting in long-lasting damages) seemed “optimistic” at best. Iran has been decreasing the pressure, reducing the flow, and giving more leeway to when their reservoirs fill up. They also have the ability to just pump oil back onto the sand (and there are some reports of oil slicks in the Gulf). So, yes, if they left their facilities on full pressure, and were worried about “dumping” oil, it might be a week or two before irreparable damage is done. But they aren’t doing that. Also, according to many in the oil industry, other countries in the region are employing the same tactics. It isn’t just Iran that faces an inability to load oil onto transportation systems (pipelines or tankers). Much of the region faces similar challenges from the inability/unwillingness to transit the Strait.

A deal would be good, but a good deal would be better.

We discuss our views, options, and even highlight a couple of possibly great outcomes in the podcast (linked above), but we do seem to be drifting towards expediency rather than something more comprehensive.

I am still in the camp that the U.S. will once again become frustrated with Iran and launch another set of attacks, to truly push this conflict to a conclusion that leaves the world much safer.

Do We Need to Understand UBI?

With the release of some formerly classified information, I probably should be talking about UFOs, but somehow I’m here thinking about UBI. UBI or Universal Basic Income is a topic I haven’t paid much attention to.

It reminds me a bit of some other economic theories that I paid little attention to, without doing much damage to my work. 

• Mint the Coin was a movement “predicting” or “encouraging” the government to mint a trillion dollar coin to avert the debt ceiling. It would get some traction periodically and every once in a while made me wish I spent some time even thinking about this “absurd” (in my opinion) “solution” to our debt ceiling.
• Brexit. Yes, Brexit eventually happened, but it took so long to play out (as does everything in Europe including their “inevitable” adoption of ProSec ) that it was at best an undercurrent of markets, and I would argue (as someone who largely ignored it), not an undercurrent to the global economy. Important for the U.K. for sure, but I think I saved myself a lot of time and effort by largely ignoring it.

The point here is that I’ve been “dismissive” of any conversation around UBI. The concept has seemed anti-capitalist and almost “un-American.” The U.S. has “safety nets” of all sorts. Every “capitalist” country has their own version of “safety nets” – some more robust than others. UBI always seemed “a step too far,” especially in the U.S., but I cannot help thinking about it, as I struggle to digest the data this week – the “hard” data as well as the anecdotal data.

For the second month in a row, we had (at least on the surface) very strong job growth – Back to Back Dingers.

If the only piece of economic data I had was the Establishment survey of jobs, I’d be pretty pumped for the economy.

But that is NOT the only piece of data we have. There are so many ways I could express concern, that it would take too long to write, and would become repetitive, so I will stick to what some other people said recently. Here are “paraphrased” comments that caught my attention:

• Recession-level demand slump in North America. (Whirlpool)
• Consumer sentiment is certainly not improving, and it may be getting a little bit worse. (McDonald’s)
• Consumers are literally running out of money toward the end of the month. (Kraft Heinz)

There are many stocks we can look to, in order to gauge the state of the consumer. HD (Home Depot), for example, is almost 25% off of its high from last October. LOW (Lowe’s) is off 20% from its high set in February. That tells me there is something off with the consumer (rather than something company specific). If people are not spending money on home improvement, that indicates a lack of optimism from consumers.

Since I’m not a huge fan (or even a small fan) of the various CONsumer CONfidence surveys, I feel almost bad referencing it for the 2nd month in a row. Yes, it hit all-time lows, but that isn’t what caught my eye. Okay, it caught my eye, but everyone saw that. This is the chart from that survey that I find most interesting.

Here we get the responses from the Republicans for the University of Michigan Survey. It is 85. Far above the 48.2 headline number (which is the one that set a new record low). At 85 it is well above the lows during the Biden administration.

But this is the lowest Republican sentiment while President Trump has been in office.

That, to me, is important.

I have never understood how or why Republicans and Democrats would have such a different view of the economy. Maybe, if somehow, it was picking up differences in regional economies (areas where Republicans reside are booming, and vice versa), but it seems counterintuitive that the difference on economic outlook is so tied to party. Which is why I largely ignore this entire CONsumer CONfidence set of data, but the recent erosion in the chart makes me think twice.

AI versus Affordability

I really, really, want to bring up the line from Apocalypse Now – “Charlie Don’t Surf.” Maybe I’ve been spending too much time fixated on the war.

But I really want to write something along the lines of “AI Don’t Spend.” Or “one person’s expense, is another person’s revenue.”

So far any concerns about job losses due to AI don’t seem to be showing up in the jobs data. This is likely because:

• The buildout of AI requires a lot of hiring. Not just making the components necessary to run a data center (chips, cooling, electricity, etc.) but also the actual construction of the data centers and all the “picks and shovels” around data center construction.
• AI, in most cases, seems to have slowed hiring, rather accelerated the firing of employees. Attrition is playing the biggest role in adjusting headcount to offset AI spending (and productivity, to the extent it is being productive).

I’m stuck believing that the pressure on the consumer, so far, is primarily due to affordability, rather than job losses.

Concern about the future of jobs or pay may be influencing consumer sentiment and spending (I’m going to keep making T-Reports so confusing that AI cannot replicate them any time soon), but the bulk of the issue is affordability right now. What the heck will happen if job losses, especially due to AI, increase?

Let’s use some “water” analogies here (to try to link into the surf comment).

• A rising tide lifts all boats. This is the sort of economic growth we are all used to. Everything does better. It doesn’t really matter what you do, or where you are, you do better. This economy does not currently have that “vibe” to me.
• We see who is swimming naked when the tide goes out. Always a good one, but not sure how relevant it is to today’s economy. I think we are more about all boats not lifting, than we are about a tide going out.
• If the water is rising and you are anchored to the ground, you are in trouble. Okay, I just made that one up. But we’ve all seen it in movies.
• The water level is rising in a room, where the “hero” cannot get out. There is real fear. If there wasn’t some fear of this, Harry Houdini probably wouldn’t be as famous as he is.

I think this latter analogy may be the most apt:

• The water is rising (affordability). More and more people are getting sucked into the daily, weekly, monthly, and annual struggle of making ends meet. If we want to go down the “k”- shaped analogy, more and more of the k is underwater. Maybe it was only the lower leg of the k that was struggling, but as the water rises (affordability), more of the k is being covered. We may well be into the upper leg of the k. I guess we better hope that is a K rather than a k where the upper leg is long and goes high, but I’m concerned it is not (I still stick with the i-shaped economy, where a handful is doing extremely well and the rest of us are seeing the water rise).

On that pleasant note…

Bottom Line

Anyone with a job that can be disrupted by AI should own AI stocks as a “hedge.” I cannot tell if I’m being facetious or serious, but it is something to think about.

It is too early to spend a lot of time trying to understand how UBI would work, but I suspect we will start hearing more about this rather than less as affordability remains an issue. The issue will decline once we get a deal with Iran, but the affordability issue is not going away (I restrained myself from calling it a crisis, but…).

On credit, I continue to think credit will do fine and like owning private credit as marks seem to be adjusting to a new reality. More for a “trade” than being married to the position. I will get a detailed report out this week, as I am actually not on the road this week!

On rates, our more detailed analysis from last weekend’s Living in an AI World stands. Largely rangebound, with 4.35% to 4.4% as the middle of the range on 10s.

Continue to focus on ProSec themes, here and in Europe. If we get a deal, expect the admin to turn more attention to things like electricity production and the processing, refining, and smelting of commodities (as well as their extraction). A lot is being done in the background, but the President remains a key driver and while his attention has been diverted, we haven’t seen as much progress on ProSec as we’d like (away from domestic-focused chip manufacturing). That should change!

Thanks for everything and best wishes to all the moms out there! Hope you and your family and friends have an amazing day today! (Hopefully, every day is amazing, but today everyone should focus on the importance of family, more than the average day, where things like “work” get in the way).

Tyler Durden Sun, 05/10/2026 - 11:05

 

 

The transcript from this week’s MiB Howard Lindzon, Social Leverage, is below.

You can stream and download our full conversation, including any podcast extras, on Apple Podcasts, Spotify, YouTube (video), YouTube (audio), and Bloomberg. All of our earlier podcasts on your favorite pod hosts can be found here.

~~~

 

Masters in Business with Howard Lindzon, Hosted by Barry Ritholtz on Bloomberg Radio

 

00:53  Howard Lindzon: Wow. If only my kids could hear

00:55  Barry Ritholtz: That. I know. They think you’re just an old man. They don’t even

00:58  Howard Lindzon: Know it. They wince.

00:59  Barry Ritholtz: Show, use the finger and ask for pity. Surgically reattached.

01:05  Howard Lindzon: Surgically reattached is a lesson of how lucky we are. What we’re you’re I’ve lived without a acute pain. Like first of all, when I, when I cut it off. It’s amazing how many people do do that.

01:19  Barry Ritholtz: Was it still dangling on or was it severed completely?

01:22  Howard Lindzon: You pick it up, you call 9 1 1 and you go As a Jew. I wasn’t sure if I boil it or freeze it. So that was the question I asked. 9 1 1. ’cause it’s never happened.

01:31  Barry Ritholtz: Well, as a Jew you were only supposed to take the tip off. Not

01:33  Howard Lindzon: The whole thing. I don dunno. If you cook it, I don’t know if you freeze it. It’s like lobster. So the woman on 9 1 1 said to Please don’t bleed out. I go, that is not helpful right now. Now as luck would have it, I live on Coronado. Good

01:48  Barry Ritholtz: Advice. Yeah.

01:49  Howard Lindzon: Out. Good advice. I’m like the one guy, hold on time. I call, write down, call 9 1 1. I go, let’s not talk. Get me a machine over to my house. Get me a robot. So living in Coronado is a magical place. You’ve been there couple times. And, and the great news about Corona is the Navy Bays, Navy Seals are there. It’s like the, it’s the greatest place.

02:05  Barry Ritholtz: They have a hospital right there. They

02:07  Howard Lindzon: Do, but I’m saying there’s cops and firemen everywhere.

02:11  Barry Ritholtz: Everywhere.

02:11  Howard Lindzon: Right. So literally as I’m dialing 9 1 1 IC it’s like they knew I cut my finger off. So, so as a miracle would have it. The the, the young. I’ve never really had to be in an ambulance themselves. Right. So, again, I’m lucky. And they took me off island ’cause they found a hand surgeon who turned out to be 30 years old, which freaked me out. Right. Because I thought he’d sew it on backwards or whatever. Right. Anyways, long story short, you know, I was at peace. Once you realize you’re gonna live. Yeah. ’cause it’s, I’ve never had that happen. Like, something like that happen

02:41  Barry Ritholtz: Was, were you gushing blood?

02:42  Howard Lindzon: Was it frightening? Yeah. Yeah. I, as a favorite of my wife, I went to the neighbors to bleed. So it was like the next day it was spotless in front of our house. Right. But as luck would have, everybody did a great job. The, the, the amazing thing, we make fun of so many things in America these days. The emergency system, I needed it. I don’t care what I pay in taxes. It was, it was amazing right

03:06  Barry Ritholtz: Now. And you still have 10 fingers?

03:08  Howard Lindzon: Yeah, I have 10 fingers for now. The joke in the family is, I don’t want it ’cause it’s kind of like a dead finger at this point. Oh

03:14  Barry Ritholtz: Really? Oh, will it be functional? Will you regain function?

03:17  Howard Lindzon: It feels like if I, if I’m using it, it just feels like a, a wet skin.

03:21  Barry Ritholtz: Right.

03:22  Howard Lindzon: And so I’m not happy, but the doctor was like, you can decide later. It was his, it was his

03:28  Barry Ritholtz: Fault. If you want a prosthetic or

03:30  Howard Lindzon: No, not a prosthetic. If you just want to work with a nub, it’s only a third of the finger. Right. So anyways, it’s, it was traumatic, but here we are. Wow. Alright. Yeah. There’s great stories. If you’re a storyteller. Yeah. Cut a finger off. I mean, if you want traffic on Twitter, bleed out.

03:48  Barry Ritholtz: Yeah. You, that’s, you get traffic. But no engagement. That’s the problem with Twitter. I wanna go

03:51  Howard Lindzon: Viral. I got nine chances. Well,

03:55  Barry Ritholtz: 21 if you wanna be accurate.

03:57  Howard Lindzon: Toes are not good in the operator. No fingers are good.

04:00  Barry Ritholtz: And 21, the 21st. No, go

04:03  Howard Lindzon: The 21st. You, you could be president.

04:07  Barry Ritholtz: So let, let’s roll back a little bit and, and start with your, your early education bachelor’s from Commerce University. Bachelor’s in Commerce from the university at Western Ontario.

04:23  Howard Lindzon: Yeah. It’s a famous business school for

04:25  Barry Ritholtz: Canada. MBA Arizona State and then famous

04:27  Howard Lindzon: For bums. Arizona State Business School. What does that even mean?

04:32  Barry Ritholtz: And then masters at Thunderbird School of Glen Global Management, which

04:35  Howard Lindzon: Was a great school now owned by Arizona.

04:37  Barry Ritholtz: Arizona State. And a great animated cartoon in the sixties and

04:39  Howard Lindzon: Seventies. Correct. Correct.

04:40  Barry Ritholtz: So, so what, given all that, what was the original career plan?

04:44  Howard Lindzon: Comedy? Yeah. I grew up

04:48  Barry Ritholtz: You and Martin Short, right outta Canada. Right.

04:50  Howard Lindzon: Not mine. He was already older. But I grew up in Toronto and that was, so when I was 75 watching Johnny Carson on my first tv, you saw everybody and it was like your living room. Right. And so it’s, Toronto had Second City. I had John Candy, Martin Short, Eugene Levy. Second City was before Saturday Night Live. And, and so I grew up just

05:11  Barry Ritholtz: Surrounding around the same time, weren’t they 74

05:13  Howard Lindzon: Little earlier. Yeah. Yeah. Three earlier. So I’m like 12 years old giggling, you know, and there was no internet. So you were like, go to the comedy clubs with your friends. Toronto had this clubs called Yuck Ys, which was a famous chain. Yes. Like the improv but of Canada. And you had Mike Myers,

05:31  Barry Ritholtz: Another Canadian. Yeah.

05:32  Howard Lindzon: Everybody exploding onto the scene at, at the same time. And so I was doing standup in high school, get out, but not good obviously. But Mike Myers would come, come up. Mike Myers would come up and kill. He was like 17 years old. Right. Jim Carrey’s. 14 years old. Right. And

05:49  Barry Ritholtz: Killing.

05:49  Howard Lindzon: Right. And so everybody wanted to be a comic. No different than like the Web 2.0. Everybody went to Stanford to be an engineer. Right. At certain, in nineties it was investment banking. Right now it’ll be robots and ai, it’s just what’s in the water. And I grew up with comedy in the water. And so that was the goal. And obviously, you know, with Jewish parents at the time, that ain’t flying. Right. Especially I wasn’t good. Right. And so I went to school.

06:15  Barry Ritholtz: You, you dropped that. You weren’t good as like an afterthought. I think if you’re successful and earning a living. Well I wasn’t even a Jewish parent will put up with you being

06:26  Howard Lindzon: Stand up. No, it would be nuts if

06:27  Barry Ritholtz: Warn like Jerry Seinfeld’s mom is fine with it. Yes.

06:30  Howard Lindzon: But I’m saying now, if my son came in and said I’m gonna go hit the comedy tour, I’d warn ’em how dark it is. But I’d say go make it. Go on YouTube. Like

06:38  Barry Ritholtz: Right. Go do you don’t to 10,000 hours. Don’t, don’t have to live in motels to

06:41  Howard Lindzon: Do 10,000 hours. Yeah. The faster you get those 10,000 hours and the better.

06:45  Barry Ritholtz: That’s right. So you grow up in Canada. Yeah. You start your career in Phoenix and San Diego and New York City. Yeah. I’m curious. That’s an interesting, you know, Toronto, Phoenix, San Diego, New York. Yeah. Yeah. How did that geographical upbringing affect your perspective as an investor?

07:06  Howard Lindzon: Oh, as an investor, I don’t know. Because as a, as a kid I was lucky. Yeah. Because if you’re Jewish in Toronto or New York at that area, you go to Florida, you know, the original Del Boca Vista. And, but my dad was different and he discovered Phoenix. And so in the eighties, like Phoenix was like swamp coolers. And he just liked the weather. And I don’t know,

07:29  Barry Ritholtz: I’ll let you on a little secret. The weather in Florida ain’t great. It’s humid. It, it

07:34  Howard Lindzon: It, well to my dad, obviously that’s the way he thought. It’s cold. It’s, yeah. So that’s the way he discovered Phoenix and bought a home. And I liked golf and biking. And so lucky for me, we had a, I went to, instead of going to Florida, we were going to Arizona. And so I would go to the football games as a kid and I was like a SU that was my dream giant is just, just, just go to Arizona State University. Which I ended up, you know, doing for grad school, which isn’t a great grad school, but it was party school. But that was my dream. Get outta Canada. Right. So I got lucky. I, you know, my parents exposed me to, you know, Arizona and I went to a SU at the time. It was amazing. And then if you’re Jewish in Phoenix, ’cause of the summers, right. It’s, it’s like New York goes to Florida in the winter. Jewish people in Phoenix go to this, go to San Diego in the summer to get out of

08:24  Barry Ritholtz: The right. They wanted, it’s closer to the ocean. It’s a nice weather. It’s

08:27  Howard Lindzon: Six hour drive and it’s 70 degrees.

08:29  Barry Ritholtz: And I love La Jolla and that whole area is amazing. So the whole,

08:32  Howard Lindzon: It’s called Zs. So Arizonans flood San Diego to to Del Mar. I wish. And so we grew up, Coronado not grew up, sorry, I I, my in-laws had a place in Coronado. And so when we had kids, I’m like, get out of the heat. If you’re not rich, you

08:48  Barry Ritholtz: Summered in Coronado.

08:49  Howard Lindzon: Yeah. We would, not summer, but a week here, A week there.

08:51  Barry Ritholtz: I wish California wasn’t six hours away if it was two hours away. A hundred percent. We were just in San Francisco.

09:00  Howard Lindzon: It’s fun again,

09:01  Barry Ritholtz: It’s a boom town. Yeah. Tales of an apocalyptic hellscape have been wildly

09:05  Howard Lindzon: Exaggerated. It’s, it’s still not my fa but it’s cool. It,

09:07  Barry Ritholtz: It’s less homeless than New York.

09:09  Howard Lindzon: Yeah. I’m not, I’m not just talking about homeless. The people are still,

09:13  Barry Ritholtz: They’re educated. Yeah. They’re intelligent. I mean if you’re, if you lose, if you’re

09:17  Howard Lindzon: Used, it’s not New York man, York City. It’s not New York. You

09:20  Barry Ritholtz: Could, you know, when you leave New York, I, I I I don’t know about you. I make a conscious effort to not be that New York abroad, even out of Yeah. It’s fun out of town. Yeah. California, especially San Francisco. San doesn’t feel like you’ve left town. I

09:41  Howard Lindzon: Love it. Yeah. I mean, I just have the California bug. Yeah, same. But coast to coast is a dream and I get to live it. So

09:47  Barry Ritholtz: It, it’s just a lot of travel.

09:48  Howard Lindzon: The thing about, and I do like Florida a lot, but same as you six hours like Phoenix or San Diego, Florida is like not on the map, no brainer. Right. It’s no, no one does it. Right. Like it’s not a thing.

09:59  Barry Ritholtz: Right. No. Phoenix to San Diego makes sense. Yeah. Phoenix to Florida, just like New York to Florida makes sense. Correct. New York to, so

10:07  Howard Lindzon: You asked, so you asked how that happened. Yeah. That’s the rite of passage. Instead of Toronto, Florida my whole life, I jumped to the West coast and then I discovered San Diego through my in-laws and my wife and man. Yeah. Well you’ve been to Coronado, it’s, oh yeah.

10:21  Barry Ritholtz: It’s ridiculous. Yeah. So let’s, let me, let me wrestle this. Yeah. Yeah. Back into submission. So you’ve worn a lot of hats. Yeah. You are a hedge fund manager, a founder, a CEO, a seed investor. A media personality. Yeah. How do you describe to people who don’t know you, what you do?

10:38  Howard Lindzon: It’s a great question. My in-laws are in their eighties and they, they still ask me, what do we tell people you do? And I’m like, who the hell cares? Well, and the world’s now decided that for you, no one cares. Right. So what do you do? Right? Like I think we’re getting back into like where it’s, it you should be proud to have like a, what do you call profession? I don’t have a profession. So you asked how I got started as an investing. I got started as investing ’cause I failed at everything else. And which is kind of the Larry David part of it is like, I stumbled into it because the internet is like water. It’d be like discovering California. Like internet was like tech. So the nineties were like, I didn’t understand it was semiconductors. Right. Were full circle. You’re

11:21  Barry Ritholtz: Not a coder.

11:22  Howard Lindzon: I’m not a coder. I don’t even know how things work. I never did Radio Shack. Right, right. Like, so the odd, I like walkie talkies were freaking me out. So the odds of me being in tech are, are, are part of the comedy full circle. We are now back in a tech world. Robots, chips, like real stuff

11:39  Barry Ritholtz: Global. They get a little secret. We never left. It just kind of fell out. Favor.

11:43  Howard Lindzon: No, I, I found the goofball era. Web two was the goofball era where you and I were social media. You could be the class clown and have scale. Okay, now that’s gone again and class clown. You, now you need to be a bully again. It’s, it’s, you need to already have distribution.

11:58  Barry Ritholtz: Right. It’s hard to build distribution today. So I’m

12:01  Howard Lindzon: Saying when

12:01  Barry Ritholtz: Being an early adopter is certainly an advantage,

12:04  Howard Lindzon: It’s super. But now it, it doesn’t matter. You have to have real tech chops. Again, you can’t pose like I am, like I have imposter syndrome for the right reasons. Right. Because I’m an imposter. Meaning the internet left a little opening in 2006 for goofballs. And we got to participate in an era of free growth. When Facebook didn’t charge you or have an AI algorithm that blocked you. You could say whatever you want. People go, he’s funny and you could scale for free. Which is why we had an internet boom. Web 2.0, internet boom right after the internet crisis. Now we live in an era where those people are confusing their genius for a bull market. Right. And we’re all sick of those people.

12:44  Barry Ritholtz: Can can I push back on you a tiny a little bit? Sure. ’cause I know you for so, so well, for so long hold the imposter syndrome aside. The early internet rewarded people who could communicate effectively, be it work your way through the media, be it blogs or short form blogs like Twitter or other social media or podcasts or video and YouTube. There’s a whole run of different ways to use the internet to scale. Yeah. So it’s not an imposter. You basically just kept tacking into what was working. Oh, this works. Let’s do more of it. Of

13:37  Howard Lindzon: Course. But the era was free. So you had the great financial crisis. No one thought effort, the internet was gonna happen. So meaning Uber couldn’t be possible without Google maps. Right. Like people say Uber’s great. It wasn’t possible unless there was an iPhone. The cloud

13:54  Barry Ritholtz: Maps or media five global

13:55  Howard Lindzon: Process, people would be taping, I want a taxi without Google Maps, no one would know where to go.

13:58  Barry Ritholtz: That’s right. And all of that only worked because of the bubble and the build out of global crossing and metromedia fiber. So I’m saying a thousand dollars a mile bought for pennies.

14:09  Howard Lindzon: No, but my imposter syndrome is born of, of course I have an ego, but my imposter syndrome was surrounded by crazy people who, who are mistaking. As I was talking to Tim O’Brien, if this was, we went from a world where strength matter, not that long ago world. That

14:24  Barry Ritholtz: A century world, not even a century, a world where

14:25  Howard Lindzon: This matters.

14:26  Barry Ritholtz: Right? No, you And

14:27  Howard Lindzon: I’m like, people just, the humility is gone. And I feel it’s with my kids and everything. It’s with the injury and everything. You have to have some humility. We need to get back to having some humility and laughing at our success and going, wait a minute, it was a bull market. Zero interest there erp, there was the free internet. Aws, right? You had YouTube, you had, if you d here’s my question. If you aren’t successful, that’d be more interesting. I want to talk to the guy like the Larry David commercial with FTX. I mean he is like, right. Oh, the circle who fire,

15:01  Barry Ritholtz: Who needs a wheel? Who

15:02  Howard Lindzon: Needs fire? That was such a great commercial. ’cause only Larry, David or f you know, I know the guys who wrote the commercial that what made that commercial great is Larry David gets the joke. Right?

15:13  Barry Ritholtz: You idiots. He’s in on it.

15:14  Howard Lindzon: You’re in on the fact that of course you made money, you worked at Facebook, it grew because the product was genius and tricked people into signing up. You did nothing except ride the the train. Now, I’m not saying smart people didn’t work there, but let’s remember Game of Thrones we’re all dead. The people that are successful today are Mark Andres and Shaman. The people that I can’t like, are hilarious to me. They have no humility is that Game of Thrones. There we’re all dead. First, second, first scene. Right. There’s a hammer in our heads and, and you and I might have a chance ’cause we’re the court gestures,

15:48  Barry Ritholtz: Right? That’s right. And

15:49  Howard Lindzon: If we dance well enough,

15:51  Barry Ritholtz: Dance with me Monkey boy. But

15:52  Howard Lindzon: Andreessen dead. Right? Jamag dead. Right. There’s just a pitchfork in their foreheads on the first scene of gladiators.

15:58  Barry Ritholtz: Well, if you, you know,

15:59  Howard Lindzon: So that’s the,

16:00  Barry Ritholtz: You have people like Da Vinci that were consultants to the king to help build weapons and things. So unless you can, you know, early days, days of Palantir. Unless you can say, sure. Hey, here’s how to make a better catapult. Sure. You know, those guys survive.

16:16  Howard Lindzon: So I’m saying I come along with like tweeting stock twits. Like, it was just enabling communication. Listen, I’m very proud of this stuff. Yeah. But I’m also can laugh about how stupid it is. Like I don’t have another trick. Like the internet left this opening. Kind of like discovering California, if you’re early to discover California made it pass the Indians and the mountains. Right? Didn’t get robbed by like

16:39  Barry Ritholtz: Murdered stampeded cash.

16:41  Howard Lindzon: Like right, let’s carry all our money in a stage coast pulled by horses at three miles an hour. What are the odds we get killed? Right. It’s impossible. So the internet left this opening and I snuck through it. And it’s fun to look back with some humor at the whole thing. You, you’re gonna let, I think the hole’s closed up.

16:58  Barry Ritholtz: Like Elon

16:59  Howard Lindzon: Owns the pipes. Zuckerberg owns the pipes. True social owns their version of a pipe. TikTok has an algorithm. How do you break

17:07  Barry Ritholtz: Through? Because those things get tired. And the next gen says, but there’s no scale. Just the way fa just the way Facebook became, oh, my parents are on Facebook. I’m out. I’m gonna go to Insta and then I’m gonna go to TikTok. And so there’ll be something new.

17:21  Howard Lindzon: You’re not questioning that. I’m just questioning. It’ll never have been e it’ll never be easier than when I made money. And I’m cool with that. I’m like, that’s the imposter

17:30  Barry Ritholtz: Syndrome. I don’t disa completely disagree with you. And you’re touching on a pet thesis. I love to ask, what would’ve happened to you had you been born a hundred years earlier or even

17:42  Howard Lindzon: Dad first

17:42  Barry Ritholtz: Seen, or even 25 years earlier. Right? Yeah. If you are born in 1940, what happens?

17:49  Howard Lindzon: I’m a furrier. Look at my ox mo

17:56  Barry Ritholtz: Beaver peltz. Look at my fur. I have all these beaver PEs.

17:58  Howard Lindzon: I have a, a cafe that has so many dishes on it that make no sense. Right. And I’m selling furs some, right. I mean, I had no shot. I have no

18:06  Barry Ritholtz: Strength. Right. Right. Just think about how fortunate you were. I cut my

18:09  Howard Lindzon: Own finger off.

18:09  Barry Ritholtz: Right? So if you didn’t bleed out your nine finger had forever. Well, but have watched to show the nick, you stick, you stick your finger into the fire and you ize it. That’s what the old timers would tell you. Get a bo get a piece of steel in the, in the fire. They’ll heat up the iron. You just burn it. And that’s your nine. All

18:28  Howard Lindzon: I thought about

18:28  Barry Ritholtz: Was like, Howie,

18:30  Howard Lindzon: What’s the, what’s the, is the ambulance gonna charge too much? And should I bleed at the neighbor’s house? Those were my first two thoughts. My wife will kill me that I’m bleeding in our yard.

18:39  Barry Ritholtz: Oh wow. Let’s do segment two. And I have to start by asking about social leverage. You’ve, you’ve been doing this for 20

19:30  Howard Lindzon: Years.

19:31  Barry Ritholtz: Yeah. So how from the first seed fund you did to today Yeah. Where you have a portfolio of 150 plus companies. Yeah. How has this evolved? First of all, what was the first company you invested in?

19:42  Howard Lindzon: So the first company I invested in was the, was so dumb car, cars direct 1998. The tippy top. As my wire left digitally, my fingertips or whatever bank it was coming from. It was worthless. Right. Meaning like it was a series Q

20:01  Barry Ritholtz: Right?

20:02  Howard Lindzon: It was But

20:02  Barry Ritholtz: You were just early. This was Yeah, yeah, yeah. pets.com eventually became, but I

20:06  Howard Lindzon: Was late in that cycle. ’cause was

20:08  Barry Ritholtz: Carvana would’ve been. Yeah. So

20:09  Howard Lindzon: I was a retail idiot. So I grew up, like I said, I went to a SU You’re gonna be a furrier. Right. That’s your chance. And so in a bad one. ’cause you know, so the internet comes along. I fall in love with stock market ’cause I had made some money at my, at my first startup and I had to be my own broker. And so Yahoo Finance, jim cramer street.com. Like they’re still around. Right. So, so those were my onboarding. Were the, were you were writing for the street.com.

20:37  Barry Ritholtz: So I was they were the dominant, like people who were younger. Don’t realize by the way, that

20:42  Howard Lindzon: Still massive. Right? Kramer’s still massive.

20:44  Barry Ritholtz: I I think the street.com doesn’t get the traffic. No,

20:47  Howard Lindzon: But Kramer’s

20:48  Barry Ritholtz: Massive. Well, yeah, well he’s on TV twice a day. But

20:51  Howard Lindzon: I’m saying this is 30 years. Yeah. So that was my imagine the introduction to retail investing. ’cause I couldn’t afford a Bloomberg. Still can’t. Right. So I think you can, I can afford afford the

21:00  Barry Ritholtz: Drapes. I think you could afford a Bloomberg Post. I

21:03  Howard Lindzon: Could, I wouldn’t know how to use

21:03  Barry Ritholtz: It post Robin Hood exit.

21:04  Howard Lindzon: I wouldn’t know how to use it unless there’s a phone line. What? Especially

21:07  Barry Ritholtz: Huh. Church. Especially with fingers. How you need all 10 fingers for the terminal.

21:12  Howard Lindzon: So, so I was inspired by you that street.com had murders, row of writers. It’s amazing to a new investor. Yeah. I just would sit and wait for articles to come out and Yahoo Finance. So I was on the message boards. Pearlman you like we were, the first download was on the message board

21:27  Barry Ritholtz: First. So Cars Direct was your first investment.

21:29  Howard Lindzon: And 10 years later I got 10% of my money back after it being successful. So, so my first thing was a disaster. What

21:37  Barry Ritholtz: Was your first successful investment?

21:38  Howard Lindzon: So my first successful investment was a cold call that I made pre-internet in a, in a company I probably talked about in the last show called The Grip. It was the, so Q So I had the good fortune of being an hour before the internet, before the internet, an hour before the internet. The thing before the thing was QVCI

21:57  Barry Ritholtz: Recall. Okay,

21:58  Howard Lindzon: So before the internet still on

21:59  Barry Ritholtz: TV

22:00  Howard Lindzon: QVC was the interim, right? Meaning there was the whole of Philadelphia was just old people on the phone saying, yes, yes, we’ll take your order and your credit card. Right? And if you were on QVC was a studio like this, what

22:11  Barry Ritholtz: Was the grip?

22:12  Howard Lindzon: And we had a product called The Grip. I recall this and it’s in the QVC Hall of Fame. So I made a cold call while I was a stockbroker to this kid. I thinking he was rich. ’cause back in the nineties, you, it was just like the movie Wall Street,

22:24  Barry Ritholtz: Dun, Brad Streets.

22:25  Howard Lindzon: You would get a newspaper and decide who you’re gonna cold call that day. Right. So I hated my job. That was my first job outta college. And I was cold calling to get rich clients. And I called this kid and he ended up needing money. Like he was just promoting himself.

22:38  Barry Ritholtz: He reverse pitched you.

22:40  Howard Lindzon: He he, he reverse pitched me. Right. And, and I, and I had to cobble up 25 grand from my mom and friends and I hated my, and I’m like, I’m in. And then he paid off his Amex with that 25. But by the way,

22:52  Barry Ritholtz: Every, every stockbroker and salesperson to appreciate a good sales pitch. Yeah. There’s soccer for a good sales pitch. Well,

22:58  Howard Lindzon: He was promoting himself and I was trying to sell him something and he sold me on his company. So what was, which turned out to be a home run company. What was the grip? It was, it was, he was a dropout. Mark Sced a unbelievable entrepreneur. And he had, he had made this product with five balloons wrapped around this Siberian millet. And we were the largest Siberian millet orderers in the world in the nineties. ’cause we were making millions of balls a month by, by hand and selling ’em with corporate logos on ’em during the whole nineties rather pharmacies. And this

23:29  Barry Ritholtz: Is the desk toy, a squeezey.

23:31  Howard Lindzon: But our genius was putting corporate logos

23:33  Barry Ritholtz: On it. Nobody had done that before.

23:35  Howard Lindzon: Well that industry was huge in the nineties. Corporate giveaways. Right. With trade shows and whatever. And we just got the right product at the right time and it worked. Oh my God. We were just, how many days we were the ball. There’s so many ball jokes, but they’d all get deleted here. We were the ball boys of the nineties. How many

23:52  Barry Ritholtz: Did you

23:53  Howard Lindzon: Sell? We did, we did 60, 70 million in sales. Get out. That’s amazing. And the margins were crazy because unlike retail, if you put Bed, bath and Beyond or compact on a ball, they own it. Right. There’s no returns. And so, so we just had this pet rock business where like Compact would call ’em, we need a million balls for com decks. And we’d just hire people, illegal aliens. And they would come into Phoenix and they would all cut their fingers off like making these things. But you made

24:19  Barry Ritholtz: It in the states. China.

24:20  Howard Lindzon: We made it in the States. China. We spent, we all our money was trying to figure out how to machine make these in the nineties. And we wasted so much money trying to like, get humans out of the process. Compact would order a million, pay you

24:33  Barry Ritholtz: Right in advance

24:34  Howard Lindzon: To start. Right. So we’d be buying cars. It was just two person company. Yeah. Like a bunch of like staff. And so we’d go out to lunch and buy cars because we were paid before we even started making the product. And, and so we were like, that’s how I learned business. Kind of like back to school.

24:51  Barry Ritholtz: School. And you started this on QVC? No,

24:53  Howard Lindzon: QVC picked us up and Mark used to go on TV and back back in the nineties in QVC if it was selling, they just kept you out there like a cartoon character. Right. They didn’t, they hadn’t scientifically gone to the profit per second Right. Model because they were surprised at their success. Right. So the grip appealed to like 70-year-old women who had carpal, like they just like squeezing little arthritis,

25:16  Barry Ritholtz: Little carpal tunnel,

25:17  Howard Lindzon: Little arthritis. So we created this $19 three pack that had soft medium. And I swear to God, you can’t make this up and soft, medium and firm and QVC just kept mark on stage all day and the numbers would go unbelievable. And, and it was a miracle. That was our first success. So that was, so I was very much, that was my first internet success. So when did social, sorry, that was my first success.

25:41  Barry Ritholtz: When did social leverage launch?

25:44  Howard Lindzon: So, so, so you, you and I both lived through this, the, the great financial crisis. And that was an era. So up until 2007, 2006, we lived in a world of financial leverage. Meaning, and we know what happened at the end of that stacking, you know, Excel came out. People didn’t have to, my dad, when I grew up with my dad in Toronto, if you did an acquisition, it was like 700 pieces of paper with pencil taped together. Then Excel comes out, which of course nothing, you know, everything’s made up at that point. And one, one sell off can change the world. Sure. But, but we became a, a world that the stacking things financial leverage, right? That was the banking era. And the end of the financial leverage era came in 2006, 2007 at the same time that social media came out. So the, the, the play on words was, I wanted do as an early adopter of social media, I was like, if an idiot like me. So the idea was social leverage, you can’t implode Right. With social leverage. Whereas this financial, you canceled. Of course. Well that was pre canceled. So I’m saying my thesis was, oh my god, an idiot like me, who knows the right three people can just grow their network for free forever. Right? And so that was the birth of the i the name social leverage.

27:06  Barry Ritholtz: It makes a lot of sense. Yeah.

27:08  Howard Lindzon: It was just like a play on words. Some, some people will call me and go, oh, you guys do social investing. And go, that’s the last thing I do. Meaning I’m not, there’s no impact. It was just the i the play on words of financial leverage to social

27:18  Barry Ritholtz: Leverage. I, I like it. But

27:19  Howard Lindzon: Good point. You can blow up on social leverage

27:22  Barry Ritholtz: Now. So So now you’re up to fund four.

27:24  Howard Lindzon: Fund six.

27:24  Barry Ritholtz: Fund six. Yeah. Wow. I have the I and the V in the place.

27:28  Howard Lindzon: The good news is you passed on all of them. I did pass on. So we continue to do well until you come

27:31  Barry Ritholtz: In. Right. Soon as I come in, it’s over. Well that’s

27:33  Howard Lindzon: When we shut down. And,

27:34  Barry Ritholtz: And I famously or infamously was an investor in stock Twiz. And then when you pitched me on Robinhood, it’s a line in the book how that’s the dumbest fing idea I’ve ever heard in my life.

27:48  Howard Lindzon: You weren’t the only one

27:49  Barry Ritholtz: And it was tha it was. I will, I will, I will. I You are in the

27:54  Howard Lindzon: Majority. You were in the majority. I

27:55  Barry Ritholtz: Own it in the book. And between you and me, I’ll say A, it was offbrand and B no doubt that the pandemic lockdown helped them dramatically Perfect

28:06  Howard Lindzon: Time. No, no, no. The the, the thing about ramen hood, ’cause I was there from day one and by day one, I mean they had, it was another company, right? Kronos Research before they were like high frequency guys and math guys. But you could only, this is about you ask about investing. It’s, you know, the life I’ve led boots on, like, just curiosity, your eyes, nose, ears, feet. You, you become a great investor by like it touching feeling, right? You gotta be on street level. The best investors are street level. I invest, I’m talking about private markets, public markets is a different thing. Street. So

28:42  Barry Ritholtz: Let’s talk about private, let’s talk about

28:44  Howard Lindzon: Street. So, no, we were talking about Robinhood. So, so the great thing about Robinhood is it’s not that I got it right? It’s like I was, if I didn’t get that right, I’m nobody. Meaning I had to get that right as a Yahoo Finance user street.com guy, E-Trade baby, you know what I mean? Twitter, user StockTwits founder. And, and I, if I had any nerve or any tech skills or any like real balls or whatever we’re gonna call it, I build my own brokerage. Like we, I was there to do all that. But in 2010, even till till Robinhood started, no one wanted to start it. Brokerage ideas were terrible ideas, right? So you have to understand that in 2013 when I saw Robinhood, no one in America, that’s shocking that no one wanted to build E-Trade 2.0. Right? But what the venture capitalists were doing, they were enamored. And this is where venture capitalists, I always goof on venture capitalists. They were enamored with the wrong thing. At the time. It was like wealth front betterment, right? The, the VCs were enamored with assets under management. A UM. They felt like Vanguard was the one to disrupt. So everybody wanted to be the next, if you’re a venture capitalist, you wanted to be the next vanguard. No one. And

29:56  Barry Ritholtz: I thought, thought that

29:56  Howard Lindzon: Was flawed. I thought that was flawed because the margins are tiny and, and you’re never gonna build something 10 times better than Vanguard. Meaning wait a minute, what’s wrong with Vanguard? And they’re, versus E-Trade. I’m like, it’s interface trade. You know, it was just ripping me off and I was a, I was the right guy to get that pitch at the right time. So of course I had to do that deal. It would’ve been, that’s what, that’s why the podcast with the guy who passed, if I passed on Robinhood, I’d be a more interesting guess. Like

30:26  Barry Ritholtz: It’s a Larry. So how much did you put into to,

30:29  Howard Lindzon: Well, we did a hundred. Like I, we had a, it was our first fund, so we were writing a hundred thousand dollars checks. So it was a hundred thousand dollars at 8 million. I thought it was expensive. 8 million, an 8 million valuation. Like at the time we were doing 3 million valuations. So, you know, we nego, like I met them by Ju and I flew up because they called me ’cause of StockTwits. So they called me and said, we have this app. They were, they were outta, they were outta money. And I flew up to Silicon Valley and they showed up wearing Google Glass Two idiots. Like, I’m like, immediately I’m out like no one, you know what I mean? Like, remember that era

31:06  Barry Ritholtz: Glass Holes is what everybody

31:07  Howard Lindzon: Called. I don’t know what it was, but I was immediately like, what? And two dorks. But they showed me the app. They had this guy, this Joe who was their designer who had been at Facebook and he showed me the app and that’s when I knew it wasn’t live. They didn’t have their finra they didn’t have their broker. So it was really early. But because of Stock Twist and Twitter, I knew that if you build it, they will come. If you build an a design like Uber, if you build Uber for trading, okay, what people didn’t get again was they were all betting hundreds of millions had been be invested in Betterment and Wealth front at the time. So the, the Silicon Valley was leaning into the Vanguard model, right? So no one wanted to do the deal because who needs another brokerage? And by the way, building a brokerage, getting SEC approval. VCs tough don’t like doing work. Right? They don’t like waiting a year.

31:58  Barry Ritholtz: It’s a grind. Yeah.

31:59  Howard Lindzon: VCs do not like doing investment. Now they do. ’cause there’s so much money in, in sovereign, you know, you can get so much money in charge 2%. But back in 2013, it was like, so me something that’s working, I wanna be the uber of that. So to take a year off and go get SEC approval to go do those things, they deserve to be It’s laborious. It it was, it’s tough. And you had to wait. You couldn’t just go launch it and get sued.

32:20  Barry Ritholtz: Thi this is in hindsight, if you want to be the next Vanguard, wait, their secret sauce is that they have such scale, they can charge four bips and still make money. You, you’re losing money at 25 bips.

32:33  Howard Lindzon: Yeah. And if you switch, you switch. Right? But they have so much assets. Right? So switching costs. So I could, we could talk about this forever. I was in the right place, right time, right. People pitched me, right. Valuation, everything worked. I could tell you a hundred stories of like everything lined up and it doesn’t work. Robinhood would’ve worked whether I showed up or not. Right? So we did a hundred thousand. Now obviously we helped them tremendously with stock to it. So we were like responsible for hundreds of thousands of early signups. ’cause stock with users love the idea of

33:00  Barry Ritholtz: Yeah, of course free trading.

33:01  Howard Lindzon: Free trade free. But also the API hooking into you could slide right on,

33:06  Barry Ritholtz: Right over

33:06  Howard Lindzon: And, and trade. Yeah. It’s pretty funny. Now that idea in oh seven when I had it Jack and Ave, like as a Twitter guy, I went to Jack and a Jack Yeah. And a, and Fred Wilson put me in the room with them. And I’m like, guys, what are you talking about? Kim Kardashian taking a poop on Kanye West. That’s not interesting. You know what’s interesting? The president’s gonna tweet one day and the markets are gonna move. Like this is literally pitch the conversation. My pitch to Jack and AAV set up by Fred, Fred Wilson, who was, they were like, kumbaya plane lands on a Hudson. Right? You know, we’re growing our beards. No. You know, like, I mean they were just the darlings. They didn’t need I ideas. So they

33:45  Barry Ritholtz: Were like, well it was, it was the town. The town. No,

33:48  Howard Lindzon: They weren’t massive.

33:49  Barry Ritholtz: They weren’t for the world

33:50  Howard Lindzon: Financial guys. They were kumbaya guys. They were builders. So my pitch fell on like, who are you?

33:56  Barry Ritholtz: They didn’t get monetizing Twitter through

33:58  Howard Lindzon: Brokers. They didn’t, it’s not about monnet. They didn’t understand what they had. Meaning selling ads against something that Goldman Sachs will pay infinity for. Meaning a new pipe where Bloomberg’s charging $2,000 to get real time information now like Osama bin Lain getting killed. The futures like in oh eight whenever Osama was finally killed. What year? 11, 12. I know where I was, right? Because immediately I checked the futures and they had already moved. Right? And that’s ’cause of Twitter, right? Because some guy in Pakistan saw it. And the futures move, right? Like that’s when it should have clicked is like, shut down everything, delay the feed 30 seconds. And you know what’s gonna happen? Goldman will call you Reuters, Bloomberg, they’ll see that you’re off by 30 seconds and they’ll pay you fortunes to get the real time feed. Right? You and me schmuck, it’s even seconds. And three don’t need real time. One

34:51  Barry Ritholtz: Second, it’s five minutes. Right?

34:52  Howard Lindzon: So my pitch to Jack and e with Fred Wilson was like, slow down the feed. ’cause 99% of the population and then we we’re there anyways with ai, no one, no one gets the real time feed, right? Slow down the feed, your phone will ring for the people that know that the feeds are not in real time and they will pay you infinity, right? To get the pipe. And they were like, no, let’s sell ads. So here we are.

35:17  Barry Ritholtz: So, so you haven’t talked about the cash tag, which I really wanna talk about something Stock Twits invented. Yes. A dollar sign and then a A PL is the symbol for Apple or

35:27  Howard Lindzon: So, so this is the Ginette store. So again, I didn’t wanna start a company, I just sold Wall Stripp, which, you know, which was my best work. But again, stupid work arguably. But my be no personally I’m most proud of it. You sell a company to CBS when you are literally an idiot, right? Is the dream. And

35:44  Barry Ritholtz: I think that’s a fair disclosure. Yeah, yeah, yeah. Advised like

35:47  Howard Lindzon: They said, by the way, as they wrote as Les Ez wrote the che, he goes, I can’t believe we’re writing an idiot like this. A check. That was like, he said that,

35:53  Barry Ritholtz: That’s the quote.

35:54  Howard Lindzon: I said, please write that like you in your book, please write that you’re so angry. So anyways, they had just bought my company and literally a month later I’m like, you made the wrong acquisition. You need to buy Twitter. Like Twitter is

36:09  Barry Ritholtz: Said this to them, to,

36:10  Howard Lindzon: To Quincy at, at who had bought my company at CBS. And I remember there was no iPhone yet. And Twitter came out and I thought it was stupid. You thought it was stupid. We all thought it was stupid. It was just annoying. Andy Swan, an old friend, was like, I get this, this is financial. ’cause you know, at the beginning I’m on, we all had our Blackberry, it wasn’t even, it wasn’t even a native mobile app, right? It was just the web and it was all venture capital. And my shtick in 2006, 2007 was I just peed at the Gramercy. Like, so the VCs loved me. They were like, who’s this idiot talking about with bowel movements? And and then Andy Swan said, you know, this is like financial, this is like a new Bloomberg, right? And I said, and I just, so, so the hashtag was a thing and I’m like, it was all spam. Like if you went to Apple, like hashtag AAPL or hashtag Apple, it was like, I went to the store and bought a green apple. Right? Like that’s literally what people were saying it was. So now it’d be like, let’s a new Apples. But like at the beginning I was like, I bought a green apple. And I’m like, that’s spam. So I sent Fred Wilson the first message that I’m saying like, and back then Blackberry was the hot stock. And I’m like, I just bought dollar sign RIMM. And Fred Wilson is the godfather of all this and was an investor in Twitter. Sent me back a Texaco, this is genius. You need to start a company. And that’s what set me down the stock t it

37:27  Barry Ritholtz: Patch did Was Wilson an investor in stock? Twiz?

37:29  Howard Lindzon: No, because he was an investor in Twitter and he thought there would be a conflict.

37:32  Barry Ritholtz: It’s no conflict. It’s, I agree.

37:34  Howard Lindzon: But Fred is a Fred,

37:35  Barry Ritholtz: The

37:35  Howard Lindzon: Og, Fred Fred’s the OG Fred, full dis disclosure. Fred, Fred, Fred on strategy is if he bets on one, he does. And I, I follow Fred’s strategy. There’s other people who spray and pray and don’t care who they and 90% do that. But Fred was of the opinion back then as like, I work with you, there’s gonna be, conflicts are a thing. Like no conflict, no interest, of course. That that’s, he’s very cool that way, but don’t create conflicts just to create conflict. So in his wisdom, he was like, you know, what’s gonna happen if you guys get in a fight and yada, yada, yada. So he politely backed out. But we were backed by good VCs, right? Raising money was not my problem. The, my VC should have said Harry, you know, just not a good enough idea.

38:18  Barry Ritholtz: So as an investor in StockTwits, I always wondered why the hell didn’t Twitter buy StockTwits? Well,

38:24  Howard Lindzon: They don’t understand finance.

38:25  Barry Ritholtz: Is that what

38:26  Howard Lindzon: It’s, they should have bought it. You remember the last scene in Raiders of the Lost Ark? Yeah,

38:29  Barry Ritholtz: Of course. The whole

38:29  Howard Lindzon: Movie

38:30  Barry Ritholtz: Where they is about

38:31  Howard Lindzon: Getting, and then the last scene is this is a very important, again, media matters to investing into the, and it’s just a black hole. Forever Miles. Forever Miles, never to be seen again. Miles of miles. The best tech companies like Salesforce, he understands corporate dev. Sometimes you buy something to kill it,

38:50  Barry Ritholtz: Right?

38:51  Howard Lindzon: To say, and by the way, it’s not

38:54  Barry Ritholtz: Best.

38:54  Howard Lindzon: It’s cost me a fortune. They’re like my Newman, Twitter’s like my Newman from Seinfeld. It’s like Twitter, like, you

39:00  Barry Ritholtz: Know, now who’s dating themselves.

39:02  Howard Lindzon: So, no, but what I’m saying is they’re my Newman, like in Seinfeld, meaning these people, it was a clown car. As, as Zuckerberg said, there’s so many people that got rich.

39:11  Barry Ritholtz: It was a clown car. Non executing. I love the Linein Yeah. From Zuckerberg. You, it was in one of your recent posts, right? But,

39:16  Howard Lindzon: But Zuckerberg said it first,

39:18  Barry Ritholtz: Which was,

39:19  Howard Lindzon: It was a clown car. I

39:20  Barry Ritholtz: Don’t know. That crashed into a gold mine. Yeah.

39:22  Howard Lindzon: And so Twitter and the, the real problem with Twitter was it was a financial product. And Elon knows that better than anybody in the end. ’cause he,

39:31  Barry Ritholtz: Although he just,

39:32  Howard Lindzon: Well he monetized it by stuffing it in a shell company. It’s still like, it’s an asset. And he’s made tremendous mistakes to, to, to think that Trump end around of the whole thing. Meaning Twitter’s supposed to be a real time network, right? They have to poll true social, right? True social is worthless other than one guy who sits on top of Twitter, right? And you have to copy paste his tweet like so Twitter,

39:57  Barry Ritholtz: Well, on a different platform forgetting

39:59  Howard Lindzon: How bungled the company is, the fact that they owned real time and do not own real time. And that I’m the schmuck that came up with the original, like Trump is gonna tweet. Now obviously Obama was president when I had this idea. But like that the pipe matters. And who is king of the pipe? To think that Trump beat Elon at his own game is pretty insane.

40:20  Barry Ritholtz: He, he is savvy in ways that people don’t appreciate

40:23  Howard Lindzon: Insane the truth. Social exists, it’s worthless. But for one guy tweeting, right? Unbelievable. So it’s inconceivable

40:30  Barry Ritholtz: To, to bring back

40:31  Howard Lindzon: You bested my man of orange

40:33  Barry Ritholtz: To,

40:34  Howard Lindzon: To, so the poison cannot be in front of you.

40:36  Barry Ritholtz: So, so now 2024, you come back to stock Twiz Yes. As CEO. Yeah. What motivated that? Are the early investors gonna see an exit? What’s, what’s going on?

40:47  Howard Lindzon: That’s inside information.

40:49  Barry Ritholtz: No, it’s not public.

40:50  Howard Lindzon: No. So it’s

40:51  Barry Ritholtz: Not, it’s it’s, it’s non-public information. It’s like a but it’s not legal inside information.

40:56  Howard Lindzon: No. Stock just is like a, a corn on your foot. You can’t, no. I mean, listen, just can’t go away. Here’s the thing about venture capital is here’s the thing about venture capital. Not everything should be venture capital. True. Okay. So I joke about this with, with my finger. Like, like whose fault is it? Okay? I think stock is a great idea. The Cash Act was a great idea. Yeah. I’m very proud of that. Hundred percent. I’m not proud of having to run a company 17 years later. Not that it wasn’t my dream when I started Stock Twist is to be sitting here answering questions about how am I gonna make money? Let me bust your up, but you every right to do this. So what I’m saying is, I and young kids need to know this like math. Not everybody gets to have a startup.

41:38  Barry Ritholtz: Of course.

41:39  Howard Lindzon: Okay, well my venture capitalists, if they’re as good as they say and they are great, should have stopped me and said, this isn’t quite venture capitalist.

41:48  Barry Ritholtz: Let me push back on that. ’cause I knew you gonna go there.

41:50  Howard Lindzon: I am,

41:50  Barry Ritholtz: I am. And your venture capitalists, and we know a lot of the same people said, Hey, there was a window to get out. You wouldn’t have gotten a, an fu number, but you would’ve gotten a pretty good number.

42:02  Howard Lindzon: No, I never got a number.

42:04  Barry Ritholtz: There was never, I thought there were discussions that just never came to always discussions. Yeah. I thought you guys were on the one yard line.

42:11  Howard Lindzon: I’m discussing it right now. Openly, there’s always a price. Who, which camera? Camera two. No, listen, we have never, some things are only fairly valued for a second. Right. And some things stay overvalued or undervalued forever as we know from the market. For sure. And I think StockTwits I’ll take full responsibility. We’ve always missed a window of positioning, right? But the good news is stock TWI is thriving, right?

42:38  Barry Ritholtz: It’s doing well. This is a perfect,

42:40  Howard Lindzon: So I’m saying like,

42:41  Barry Ritholtz: Robinhood should be the,

42:43  Howard Lindzon: We were 10 years ahead of our time. If you think about where public, when, when I started stock to retail, investing was a laughing stock. Yeah. And it still is to most institutions,

42:52  Barry Ritholtz: Much less so today than it was. Correct. Now it’s

42:55  Howard Lindzon: So, so again, if you look at my portfolio,

42:57  Barry Ritholtz: The, by the way, the private equity, private credit wouldn’t be so hungry for retail investors if it was truly us.

43:05  Howard Lindzon: They call me every day, right? So there’s two worlds that I live in the world where retail doesn’t take itself seriously enough. And private equity guys call me CEOs of public companies call me to take like I’m in a crazy seat, right? Because I’m a goofball. Right? But I am serious, you know, like I am serious. Like I’m trying to be serious.

43:24  Barry Ritholtz: You used to be 60 40 goofball serious. Now you’re 40, 60.

43:28  Howard Lindzon: Yeah. It switches.

43:29  Barry Ritholtz: You’re the new 60 40.

43:31  Howard Lindzon: Yeah. I’m, I am. I can laugh at myself, but I’m trying to run a serious business. Right? Because, because it’s been a long time and we were just way ahead of the curve. Like Jack and Eeb didn’t understand what we have. Fred Wilson understood it. Right? There are very few people that understood. Very few people liked Robinhood until 2020. And GameStop, they like it for the wrong reasons. By the way, I don’t like the Robinhood that became like, I don’t, not, I call it the degenerate economy. But when I invested in Robinhood, I didn’t know the degenerative economy would exists. I didn’t know the prediction markets would exist. I didn’t know options would be their biggest product. I was just wanting to see options

44:10  Barry Ritholtz: Are bigger than crypto for Robinhood.

44:12  Howard Lindzon: Crypto’s Tiny Options is everything. Huh? 90% of their fucking profits will come from o Options. Any brokerage.

44:18  Barry Ritholtz: Wow. I didn’t realize that.

44:20  Howard Lindzon: How are they gonna make money on zero commission other than options, people

44:23  Barry Ritholtz: Doing YOLO trades payment for order flow margin loans.

44:26  Howard Lindzon: That’s just a, that’s just media being bad media.

44:29  Barry Ritholtz: I, I’m gonna tell you that the big shops like Fidelity and Schwab, the single biggest line owner line item of profitability are credit loans

44:38  Howard Lindzon: And money. Okay. It could be I’m 90, I don’t know. I don’t, I don’t The

44:42  Barry Ritholtz: Financials, no. I mean at one point in time it was over half at Schwab. I don’t know what it’s today. Yeah.

44:45  Howard Lindzon: When we invested in Robinhood here was, my thinking is, first of all, I love the product. You gotta be a user of the product to be a good investor. I’m not the guy who’s like, here’s space check and here’s a biotech check. Right? What do I know? So yeah, the odds have to be stacked in my favor, first of all. But second of all, and they were, I was Yahoo. I was Yahoo Finance, I was you, I was blogging, I was doing everything right. And, and they came along at the right time. When Robin, the pitch for me with Robinhood was not that they were gonna make money, it was an 8 million valuation. Like, you know, at my event people were like, how are they gonna make money? I’m like, chill the hell out. They haven’t even launched a thing yet. The point was Schwab was paying $150 to get a customer

45:25  Barry Ritholtz: To acquire customer, customer acquisition

45:27  Howard Lindzon: Customer. Yeah. And my thesis was like Uber Robinhood would pay zero. So if you get a million people, even if they’re $4 in their account, it’s a hundred. That’s a good herb. Yeah. Those don’t come along very did. I think it could be $30 billion. I’m not so psycho that I thought I was investing in a 30, $40 million company. Billion, billion, billion, billion dollar company. So of course I’m not that smart. But what I’m saying is I saw the ARB and all they had to do was deliver the product. Now it went way beyond my expectations. That’s the Larry David

45:56  Barry Ritholtz: Part by the way. You didn’t gimme that pitch. The pitch was, I,

45:59  Howard Lindzon: I’m sure I did. The

46:00  Barry Ritholtz: Pitch was free trading millennials, the whole next generation. You’re gonna capture them before anybody else.

46:05  Howard Lindzon: Well, I knew that from Stockton. I knew I’d capture ’em. But if I say, if I mention the ARB trade, people are like, oh, they’re gonna have to raise so much money. There was a lot of problems.

46:14  Barry Ritholtz: No, the ARB trade in hindsight. Yeah, the trade A

46:16  Howard Lindzon: Trade would, was why I invested would

46:17  Barry Ritholtz: Would’ve been compelling. And, and again, I it’s a chapter, the, I’ll tell you a great, Hey, it’s so offbrand

46:24  Howard Lindzon: One great story. Go ahead. Because, because this is just a, an investing story. So we’re a very small fund. The first one was 6 million. We’ve, we’ve done, now we run a hundred million dollar funds and

46:33  Barry Ritholtz: You cap it at a hundred or

46:35  Howard Lindzon: Yeah. I don’t think you, I don’t think get our returns would be good. Yeah. We like writing one to $2 million checks. I get that. Stay in your lane is something everybody hates saying. But I think true in my world, unless you’re fee gathering, stay in your lane. Like people know what we do,

46:48  Barry Ritholtz: You’re gonna laugh.

46:49  Howard Lindzon: I I believe in that. I hate when people say it, but Right. I

46:53  Barry Ritholtz: Practice it. That, that’s an annoying way to say I disagree with what you’re saying, but Right. But what you’re saying is that’s skill. Hey, your expertise. Here’s my skillset. Yeah. I’m

47:01  Howard Lindzon: A good monkey.

47:02  Barry Ritholtz: I to apply my, the area I know best.

47:04  Howard Lindzon: So with ramen, so occasionally, and again,

47:06  Barry Ritholtz: Stars

47:07  Howard Lindzon: All long enough and I had breakfast with Fred this morning. We’re talking about like, you’re a legend. Josh is a legend. Like I’m around surrounded by legends. ’cause I’ve lived long enough, okay, I’ve lived long enough and I’m curious and I’m nice and I call people to say hello, I’m a salesman. So who do I see this morning? Fred Wilson. Like who did I run to? Tim O’Brien? Like I’m friends with like people that have, you have signal, right? Because you have what you’ve been on the street, right? And you have experience, not maybe in space, but in what you do. You have signal. So with Robinhood, and I had learned from Fred Wilson, like if you really believe in something just, and I’m not a poker player, I don’t ball, you gotta go in as a vc you have to, so Robinhood,

47:47  Barry Ritholtz: You’re, you’re convincing me to throw money into Fund vi and that’ll be the end of your run. But

47:52  Howard Lindzon: That’s different. Every fund is like a crop of wine. It could go depending on how you know we’re wrong all

47:58  Barry Ritholtz: The time. Well, 24 was a good vintage

47:59  Howard Lindzon: 2020. 2021. Terrible vintage. So, so, so when Robinhood was doing very well, but they, the two guys were like, it was not popular. Everybody, all the VCs had committed to betterment wealth front type model. Right? So now they needed to raise another round. And I’m like, they wanted a raise.

48:18  Barry Ritholtz: This is 14 or 15? 14. Yeah. So it was like, I think that’s when we spoke. Yeah.

48:22  Howard Lindzon: So they were like it and I’m like inexperienced. ’cause we write one check, we don’t have more money. So they call me up and they go, can you write us a term sheet? It’s a very sophisticated way of saying like, you won’t have to like actually invest, but if you come in like we can shop, like we can kind of shop around. You can shop it around. So I’m like, dude, screw that all I wanna invest. So over like July 4th week, I’m telling my partner, and I was two of us at the time, I’m like, let’s just write an 11 million. They needed to raise 11 million bucks and they wanted to raise it at some stupid valuation. Right? Let’s, it was 60 million ish. And I’m like, well we’re never gonna have to really write it, but even if we do, I can convince my friends like, this is the what. Right. And I called Fred Wilson and he goes, what are you calling me for? You know what to do. Let’s write a term sheet. I go, but we don’t have $11 million. And Fred goes, you’ll find it. Just, just do it like a six week. Right. Which is absurd. Now today people write billion dollar checks in an hour. Right. But like he goes, just ask for six weeks. Right. So, you know, word, you know, whatever. You’re typing it up, send him a term sheet by fax.

49:25  Barry Ritholtz: Back then you 10 fingers. So it much,

49:27  Howard Lindzon: Much better back. It was more, but, you know, 10 fingers more errors. So anyway, so we write up this term sheet, we send it to ’em and they shop it as they probably really in Index Ventures, y Hammerer, who’s like a, like one of the best investors, comes back with a term sheet of 11 million on 65 million. Wow. And like a five day close. So like, you know, they got what they wanted. Oh, and by the way, indexing their term sheet, put index in their term sheet. Like fuck, social leverage. Right. That’s a typical, like who are they? Right. Luckily by writing that term sheet, VLA Baiju did the right thing and they carved out like as much as we could. We couldn’t even raise a million on. So when we, so they carved us out, we put 800 grand in the series A. If we had done the 11 million, I’d be a billionaire.

50:17  Barry Ritholtz: Right. 200 x on, on the, yeah. That’s unbelievable.

50:20  Howard Lindzon: No way bigger, like at the peak. But like we’ve had better investments. We’ve

50:26  Barry Ritholtz: Better investments. You’re not sitting with the Robinhood shares.

50:28  Howard Lindzon: A lot of my LPs, we distributed the stock. A lot of my LPs have not sold, sold

50:32  Barry Ritholtz: Calls it nobody says

50:33  Howard Lindzon: I don’t ask. Our job is to deliver them. There

50:36  Barry Ritholtz: You go.

50:37  Howard Lindzon: The, the, the, the cash.

50:39  Barry Ritholtz: I wanna start with a quote of yours that I really love. Okay. Quote, the whole world has become a casino. Thanks to AI and prediction markets, we are all more productive and degenerate. Now let’s talk a little bit about the degenerate economy. Yeah. Explain to listeners what is the degenerate economy or the degen economy.

51:03  Howard Lindzon: Well, I don’t like the word degen. So when I say degenerate, I say it in the humoristic way. You and I are degenerate, right. Because we’ll buy a watch. We’ll bet on a game. We laugh at de degeneracy. We don’t, we don’t, we appreciate the art of de degeneracy versus meaning, meaning laser eyes was dumb. Right. But degeneracy is an art form, like speculation. And I live, I own and I joke that I own and operate two millennials. And when you own and operate two millennials, you watch, you look over their shoulders. Those

51:36  Barry Ritholtz: Were your first startups?

51:37  Howard Lindzon: No, my kids. Yes. By the those were your startups. Startups. My the only startups that matter. And did

51:43  Barry Ritholtz: Either of them merge yet? Do we have any m and a activity yet?

51:46  Howard Lindzon: No, we need, we need, I’m not talking about spinoff need

51:50  Barry Ritholtz: I not talking about dividends. I’m talking about are they married? No. So no mergers yet?

51:54  Howard Lindzon: No, my son was, my son was in a Are you on the board?

51:57  Barry Ritholtz: You should be chairman of their board.

51:58  Howard Lindzon: Are they on the board? I’m trying to get, you see adult also. I’m trying to get them fired. I’m trying to get medical checks to see if anything’s working. Right. So, so degenerate economy was born of this idea that I couldn’t believe where we went, like with GameStop. Like I was so stressed during the GameStop thing because really I’m so surpris, I hadn’t monetized, I hadn’t monetized our investment. I’m like, okay, on Robin Hood there, there was a weekend Yeah. When Robin Hood was worth 40 billion.

52:28  Barry Ritholtz: Right.

52:28  Howard Lindzon: And it could have been worthless. Right. Do you understand? Like

52:31  Barry Ritholtz: A hundred

52:31  Howard Lindzon: Percent. I wasn’t rich. And I’m like, it wasn’t even their blame. Whoever you want, people lost their minds.

52:39  Barry Ritholtz: Let me annotate.

52:40  Howard Lindzon: So, so let me just explain to you, if you have your phone, go

52:42  Barry Ritholtz: Ahead.

52:43  Howard Lindzon: What Robinhood perfected, which no one figured out. It was like when we used to play pinball, everybody, there was always that kid who was so good at it.

52:52  Barry Ritholtz: Crazy flipper.

52:53  Howard Lindzon: He could bump it. Well he could bump it without tilting it. Right. And he could just get the, he could just get the machine to dance for him. Tilt happened.

53:02  Barry Ritholtz: Everybody,

53:03  Howard Lindzon: The, the app was so well designed. The app was so well designed that everybody pushed the same button at the same time

53:09  Barry Ritholtz: And it couldn’t carry the, the, I remember it was scratching. Do you understand?

53:12  Howard Lindzon: That’s literally what happened. So that’s

53:14  Barry Ritholtz: What you were,

53:14  Howard Lindzon: It was a design flaw. You were, it was a design flaw. It

53:16  Barry Ritholtz: It wasn’t the design flaw. Nobody expected it to scale 10,000 x. No,

53:21  Howard Lindzon: But a if you push everybody to one button, right. Or or another button. Yeah. And then people come on see me say push this button and everybody’s like, let’s see what happens. And guess what, what happened? Crash. Crash. Not to be repeated again. Right. Hasn’t been repeated again. And the, that’s what makes the markets great. That hole was filled by the whole being created. Right. We haven’t seen another thing like this, although recently with Car Avis. But like GameStop broke the machine. Yeah. And almost bankrupted the company. Right. And and it was many lessons in there. The most important was Robinhood. None in their hubes or anything. They mistook success for a brand. When you build a brand in four years, not 40 years, you don’t appreciate that you have no brand value. Right. And I’m like, no one understands this. Like they were one of the first case studies and like why it didn’t deserve to be zero. Who knows what all the things that went wrong. But I’m just some guy that’s like, what the right. I’m like couldn’t. How embarrassing would it be if it goes from 40 billion to zero and you know, Galloway and all these guys were piling on and all these people piling on. I’m like, you don’t even understand what’s going on.

54:26  Barry Ritholtz: So wait, let me, let me tease this outta you a little bit. I thought you were going in a different direction. How degenerate the trading in things like GameStop and when Hertz was bankrupt and or was it Avis? I don’t even remember which. Some really foolish, reckless Yeah and and I, I think those of us with gray hair looked at it and kind of laughed. ’cause we knew exactly how that was gonna

54:51  Howard Lindzon: End. Yeah. The apes and all the a c stuff. I hated it. Right. But it doesn’t mean I can stop

54:54  Barry Ritholtz: It. That wasn’t your concern. Your concern was hey here’s a fire hose of new clients, new orders. This is the scale. This company needs to become wildly successful and they’re just not prepared to deal with the sheer volume. How could be, and if this crash goes on more for a couple of hours two days from now, this is a zero. It was

55:14  Howard Lindzon: A zero. We can argue, I don’t know the whole story, but I imagine someone called someone at the options clearing firm and said you’re bankrupt. And the VCs lucky we’re in so big. Didn’t they had had to put in more money.

55:24  Barry Ritholtz: They didn’t have the reserve cash. The margin trades have the of options.

55:28  Howard Lindzon: The cash. We’ll never know the real story. So,

55:29  Barry Ritholtz: So technically SIBO is the counterparty on all trades. Yes. And they also own the platform. So they demand a certain amount of capital if you’re gonna trade X. Yes. And they’re trading billions of dollars. Correct. They didn’t have that capital.

55:44  Howard Lindzon: So, so this is why my degenerative economy index was born. Meaning I don’t think AMCs in what’s in my index, which is outperforming everything is SIBO is one of my time number one positions who benefits. So my degenerate economy thesis is finding the companies that benefit from global degeneracy. You

56:02  Barry Ritholtz: Created this last year, two years ago, three years ago. All crush.

56:06  Howard Lindzon: It’s three. I had to share it

56:07  Barry Ritholtz: Just to put some numbers on this. Yeah, it’s gambling, it’s day trading. It’s meme coin speculation.

56:14  Howard Lindzon: It’s vaping. Unfortunately

56:15  Barry Ritholtz: It’s up 170%. The NASDAQ 100 over the same type of period isn’t even up a hundred percent. It’s up 94%. Correct. You’re almost doubling the nasdaq.

56:24  Howard Lindzon: And I give it away for free ’cause and I share the

56:27  Barry Ritholtz: Petition size. It’s not, why isn’t this an ETF?

56:28  Howard Lindzon: Because the VanEck always talks to me VanEck always like, why do you wanna be in the e TF business?

56:33  Barry Ritholtz: So do it. You know you use ETF architect. No I get it. Work with VanEck, but I

56:38  Howard Lindzon: Billion dollar product. Again, this is, I think part of like, you know, the age I’m at is like, I don’t wanna be someone yelling at me. That might that I Kathy would that I, I, as soon as I monetize it, it’ll go to zero. Like that thing will stop working. I love the idea that I can give it away for free. This goes back to the

56:55  Barry Ritholtz: Original

56:55  Howard Lindzon: Social media. Meaning what am I gonna make? It’s like y as soon as I start charging for it, the whole thing becomes

57:02  Barry Ritholtz: Fast, slow. I took ads off the blog ’cause they were annoying and ugly and the amount of revenue it made peanut was just too annoying. You you’re saying the same thing.

57:11  Howard Lindzon: Yeah. I’m saying like, hey man, I’m like, I got a little thesis. It’s not that complicated. I,

57:18  Barry Ritholtz: I love this thesis. I would, I think people would be

57:20  Howard Lindzon: Buyers. So she’d be always CE big hyper liquid now is in there and no one knows what hyper liquid is. I constantly What’s hyper liquid? Hyper liquid is the, is the thing. Meaning today all I get pitched on or by the next Robin Hoods and I’m like, the world doesn’t that another Robinhood. But all they keep talking about is, you know, we got perps trading 24 7 on hyper liquid. It’s, it’s, it’s the new salono, let’s call it. ’cause I’m not a crypto guy and I’m like, after getting a hundred pitches of the same product and they all talked about hyper liquid. I just bought hyper liquid.

57:51  Barry Ritholtz: And what what’s the market cap of that

57:54  Howard Lindzon: One?

57:54  Barry Ritholtz: Couple

57:55  Howard Lindzon: Billion. It’s like 12 people and one of the most profitable companies in the world side of Singapore. Like the guy has no freedom ’cause he is so rich. It’s like a system. It’s like a very fast chain.

58:05  Barry Ritholtz: What’s the symbol?

58:06  Howard Lindzon: HYPE hype.

58:08  Barry Ritholtz: Yeah. What a great symbol. Yeah,

58:09  Howard Lindzon: It’s a token. And you can buy it on Robinhood. Again, I’m not promoting, I’m just saying wait,

58:14  Barry Ritholtz: So this, you could buy it on Robin Hood, but does this not trade over the counter? You can’t get it anywhere.

58:18  Howard Lindzon: You can trade it as a, there’s a dat called PURR. And again, I’m not recommending it, but I’m long A little is a way that you can trade it over the counter. And, and again, you’re betting on the fact you don’t know anything about supply demand. You’re just Right. It’s the system that everybody’s

58:34  Barry Ritholtz: Trading on. Pure speculation. Pure speculation on other people’s speculation. That’s what is

58:39  Howard Lindzon: Speculation.

58:39  Barry Ritholtz: My thesis. This is squared.

58:40  Howard Lindzon: So anyways, what I’m, what? So the degenerate economy is about picks and shovels. We can’t stop if, if a young person like my son, and again I own and operate two millennials and, and they’ll, I don’t want them betting, my son will call me and goes, I can’t believe I lost a 20 team parlay. I go, who are you? Are we even of my, this is why I have to do a step in takeover of my son’s company. ’cause I’m like

59:04  Barry Ritholtz: Dick private, are

59:05  Howard Lindzon: You talking to me like you ask me to end my U 50 bucks to put on a 20 team parlor And you’re complaining about, so idiot three threat idiot. It’s so idiotic. So I’m like trying to teach them not to be idiots. You can have a degenerative economy, you

59:16  Barry Ritholtz: Just need a little bit of math. The problem is not enough kids, kids has taking math,

59:20  Howard Lindzon: Math important. And you also full circle on the general economy. You have the wrong teachers Right now I got brought on board by guys like you Kramer, the people who had experienced stuff. Fred Wilson. These kids are learning from Chamath and David Sachs. These guys were born of one generation. Right. They worked at Facebook. Right. They worked for Elon. You could, if you’re not rich working for Elon or Facebook, that would be interesting. Yeah. If you are rich and you’re kissing the nipple of Facebook and that’s not interesting. You are supposed to be rich. Right. Have some humor. Have So we’re, our job is to

59:50  Barry Ritholtz: Little humility. You’re a little hubris.

59:51  Howard Lindzon: Yeah.

59:51  Barry Ritholtz: So my job is to teach

59:52  Howard Lindzon: My kid is like more humility. Stop being a degenerate. Right. But the fact is, you can’t not be a degenerate when prices kids are yo lowing. Because they can and because,

1:00:04  Barry Ritholtz: And it’s frictionless. We, we

1:00:05  Howard Lindzon: Frictionless. And they’ll learn. Some of these kids will learn how to be good. Put sellers very or premium sellers. Very few. I understand. But the markets are very important. Meaning having a price on everything is fantastic.

1:00:16  Barry Ritholtz: And when I say old it’s only partly ’cause we know each other so long. It’s mostly because he’s an old man. 60 and is now 60 years old. Years ago, my wife and I, I I’m not a cruise person. We were young, we were broke. We used to use this website called vacations to go.com. You book last minute, it would cost you nothing like a week long cruise through eight islands in the Caribbean, 500 bucks food and drink included. Booze included. So as soon as they hit international waters, the casino opens. I am not a gambler. We walk through and I just decide to look at the roulette table. Not bet. Look at it. And this is the difference between my wife who taught fashion illustration and design is a visual person. I’m a little more of a math guy and I say to her, so we watching 20 minutes of roulette and it’s just, it’s so dumb. Yeah. I hate

1:01:46  Howard Lindzon: Losing money.

1:01:46  Barry Ritholtz: It it’s for for random stupid reason. Yeah. But I point out to her, look the red pays or red or black or odd, even pay two to one. But you have zero and double zero. So it’s not even odds. Correct. And then this group pays three to three to one, but it’s one in four chance of winning. So they’re making money and I’m going over all the math with her and she listens to all the numbers and says to me, I don’t know about the ratios of the math, but all I can tell you is I see people, I see theier taking off a whole lot more money than she’s handing out to gamblers. That, that’s the takeaway. Be theier not the odds. Correct. Be the house don’t be

1:02:32  Howard Lindzon: So CBOE hit all time highs. They’re

1:02:34  Barry Ritholtz: The house. Yeah.

1:02:35  Howard Lindzon: Have you ever hear anybody on social media talking about CBE? Never. Never. They love that. No one’s talking about ’em. So the other thesis that I have is trends with no friends. Okay. So, so I’m looking for trends. ’cause again, I run a huge social media site. Right. So I, if I have a choice between Nvidia and sand disk, everybody’s talking about Nvidia. You want, I’m not saying I know much about, we’re just

1:02:55  Barry Ritholtz: Talking about about Broadcom. Same

1:02:56  Howard Lindzon: Thing. Same thing. So on stock to I can look for tickers that are trending with very few followers. No, it doesn’t have to be. I don’t like small caps. So I’m like billion.

1:03:06  Barry Ritholtz: No, I mean earlier, I mean before it really goes up 10 x.

1:03:09  Howard Lindzon: Yeah. So I, so the one thing that stock to tell, and I have ai, you asked me why I came back to stock to, it’s two things. AI and the fact that like I can now code with clog code. And so I can call bullshit on engineers a little bit.

1:03:22  Barry Ritholtz: Oh, this could take six weeks. I need it by today. Well

1:03:25  Howard Lindzon: Again, there’s not today, but there’s not six weeks. Right. Okay. So so there’s that and then there’s the fact that we have all this data and we have a great community. So I wanted to come back and like see this thing through. And we’re, and we’re doing very well. The, the, the issue is now I can explain to people and I can pull out the data to show people trends with no friends. Meaning I wanna find, you wanna find stocks that are trending that have very little discussion.

1:03:50  Barry Ritholtz: Makes a lot of sense. Yeah. It’s

1:03:51  Howard Lindzon: Just intuitive. You meaning I-B-D-I-I learned on IBDI love price relative strength. We, I’ve just added a layer to that that matches high price, relative strength with low social, it’s almost like the moosh of Vegas. Right? I’m trying to find the stocks that No, even though I run a social media site, I’m like betting on the fact that like, they’ll discover this in time.

1:04:12  Barry Ritholtz: You should talk to Ben Hunt and what he’s doing with I love that Perent. ’cause they’re too

1:04:16  Howard Lindzon: Yeah, they have a narrative thing.

1:04:17  Barry Ritholtz: They’re too, but the combination of where the narrative is just starting to take off. Correct. Tipping and, and where the trends is

1:04:25  Howard Lindzon: Starting. I’m doing

1:04:26  Barry Ritholtz: This for 20

1:04:26  Howard Lindzon: Years friends. So that’s why I, so I give it away for free.

1:04:29  Barry Ritholtz: He’s quantified it. You

1:04:30  Howard Lindzon: Done it. Yeah. I hate the quant side. Yeah. I just visually see it. Right. From years of being a known quant. I went a UI don’t even know math,

1:04:37  Barry Ritholtz: But, but if you want AI to help you with this, I matters. I

1:04:40  Howard Lindzon: Gotta catch up on matters. That’s awesome. But, but he also sees the role a little darker than I see it. I’m a much more of an optimist.

1:04:46  Barry Ritholtz: You and I both. Yeah. So, but, but when I wanna know what’s the worst case scenario, like when the tariffs were first rolled out, not so much losing my finger, but his piece, the end of the pax Americana is true. Was the end point where if this really goes off the rails, this is how bad it could get. Well it’s

1:05:06  Howard Lindzon: Deglobalization, right. Which,

1:05:07  Barry Ritholtz: You know, but, but he, he works out the details. Yeah, he’s great. But again, you and I are both a little more of optimist.

1:05:13  Howard Lindzon: I’m much more simple. Right. If I see something going up, you want up, that’s my cue

1:05:18  Barry Ritholtz: To look.

1:05:19  Howard Lindzon: And then if it’s a certain market cap and then, then I check stocks to and I go, no one cares. I love that. Then I, I need to tell a story. Everybody needs to tell stories. Stocks are stories and some people are great at storytelling. The Palantir guy, the certain, but again, the numbers eventually matter. Right. And I’m trying to find companies going up. Right. And that’s not complicated. But then I have other layers to it and I need to understand the catalyst myself. Like if it’s just something I’ll never understand, it’s hard for me to ride the waves. So if I don’t really understand and use the product, the odds of me getting scared out of a trade are 99%.

1:05:56  Barry Ritholtz: So, so let’s talk about your,

1:05:58  Howard Lindzon: So that’s my index.

1:05:59  Barry Ritholtz: Let, let’s talk about your startups who are becoming degenerates. Yeah. Your kids given social apps, zero commission trading, all the options, stuff that’s going on for your kids’ benefit. What sort of guardrails, I don’t know if it’s the product regulation, educational, what do you wish was in place to protect them that isn’t there yet? And and let’s also add, these are not minors. These are late twenties adults out of school for almost a decade. Yeah. Real people. What guardrail should they have to protect them from their own most instincts? Well,

1:06:40  Howard Lindzon: Listen, we could argue let the be we put our, our negative hat on. It’s like you can go buy bullets at Walmart. So it’s like, what is a guardrail? Right? In a world where you can buy bullets and you know, everybody’s got drones. So I’m like more like, okay guys, if I hear that you did a parlay, we can’t be related. So like stop betting. Betting is different than investing. Right? So if, if, if Shane at at Poly market and their partners of ours, if they, if Shane or tq at at call sheet had pitched me those ideas at the same time that Robinhood pitched me their idea, I would’ve passed. Why? I don’t bet. I think it’s stupid. Right? Okay. Like I think it’s funny and I think prediction markets are news better than the New York Times. No offense because I like prediction markets. ’cause I don’t have an opinion. I just look at the price and I go whether I believe it or not. I think that’s the genius of it. But if, if Poly Market and Kashi went out to VCs and said, we’re the new news, their valuation would be a dollar. Right. Okay. No, they’re so we know the real story. They can’t tell what they really are good at, which is news.

1:07:41  Barry Ritholtz: And by the way, they’re not great at news. I understand.

1:07:43  Howard Lindzon: But either is news good at news? It’s

1:07:45  Barry Ritholtz: Probability of something happening.

1:07:48  Howard Lindzon: Not, but I’d rather not read someone’s opinion. I don’t need to see Elon’s finger on the news. ’cause that’s a stor. There’s, that’s not the real story. Give me the numbers. I know it’s fake, but I got a number. It, it’s not, if Mond isn’t 90% of my daughter’s mad. Right? But go Rachel, here’s what you do. That bet the other side you’ll make eight times. Or or

1:08:07  Barry Ritholtz: Put it’s 10 to one.

1:08:08  Howard Lindzon: 10 to one. But I would bet money on Madami. And if you really wanna change how you think about the world, go help somebody on the other side who has a chance go put in the time. Go help Mark Cuban if you really want to be,

1:08:19  Barry Ritholtz: I love what he’s doing on the healthcare side.

1:08:20  Howard Lindzon: But what I’m saying to my daughter, I said, call Mark, I’ll get you in touch with Mark. Do something but just complaining about the numbers that you see and the numbers were right. Whether, whether they, whether they tipped it in this, again, I don’t wanna get into all like the fraud and all the fake stuff about it, but the numbers are much easier than reading an opinion piece.

1:08:38  Barry Ritholtz: I’m gonna, can I tell share something fun. So yeah. So there was some of the early bets about outcome of the war and different events happening. And I said in a quarterly call, Hey, I don’t really know who’s putting, we don’t know who’s putting these bets in. Yeah. But if you stop and think about it, if you’re negotiating with another side, this being a psyop, ’cause you spent half a million dollars to move the outcome of something, that’s the least money the Department of Defense will ever spend. And anybody on this side is looking at this. Oh, they’re, they’re really gonna put boots on the ground. That’s look at the track record here. Here. Here’s A-A-A-A-A wallet that’s 10 for 10. Oh my God. We have to stop and think about, you don’t really know who’s using this, who’s betting this, who’s manipulating. But we didn’t know that guy who got arrested. That was a throwaway. That’s a, it’s still better. That’s

1:09:33  Howard Lindzon: A false flag. It’s still better than Russia and China using our social media against

1:09:37  Barry Ritholtz: Us. Oh my

1:09:37  Howard Lindzon: God. It’s forced. So I’m very forced.

1:09:39  Barry Ritholtz: And North Korea and Iran.

1:09:41  Howard Lindzon: Yeah. So I’m not saying I’m for, I’m an investor in poly market and college personally at crazy valuation. ’cause I wouldn’t have invested, like I just chased it in, in s pv

1:09:50  Barry Ritholtz: Personally the, the co founder of Calci, the woman, what’s her name? I

1:09:56  Howard Lindzon: Don’t know, but I know it’s a woman. I just can’t

1:09:58  Barry Ritholtz: Remember her name. No, she was a guest on the podcast and I was she great. She was really good. This is years ago. Yeah. I, I’m not this three years ago I should never even thought to put money into it. So

1:10:06  Howard Lindzon: That’s what I’m saying because I

1:10:07  Barry Ritholtz: Don’t, it felt sounded more academic than anything.

1:10:09  Howard Lindzon: It was academic. Yeah. And it still is because there’s very few people using these products for all the free press. It’s like Twitter. There’s very few people using Twitter. Right. All, well, Twitter,

1:10:19  Barry Ritholtz: Press aside. Well Twitters started getting the drain at this point. No,

1:10:21  Howard Lindzon: But I’m saying at the beginning it had a lot of power even though there weren’t that many users.

1:10:25  Barry Ritholtz: It was, it was, you know, it was a fraction of Instagram or TikTok. So put markets

1:10:30  Howard Lindzon: Is the same a fraction. It’s a fraction of the news. But I’d rather my son and daughter go to page two of Poly Market. ’cause you know what? They’re gonna see news that they didn’t, wouldn’t never look at it in the New York Times and go look at the election in Peru and now at least I’ll know the names

1:10:45  Barry Ritholtz: Or Venezuela for that or

1:10:46  Howard Lindzon: Venezuela. So I am super bullish for different reasons on prediction markets. And I know there’s like, obviously I have money on this

1:10:53  Barry Ritholtz: Side and this fits right into the Degeneracy index. It fits completely.

1:10:57  Howard Lindzon: How

1:10:57  Barry Ritholtz: Long does the DEN index run for? Is this a short term thing or does this have legs?

1:11:02  Howard Lindzon: Great question. That’s why I don’t want to charge for it. ’cause I think I’m a elect. ’cause Google and Apple are my biggest positions because they are the rails for the degenerative economy. They are the front facing tool of it.

1:11:14  Barry Ritholtz: And Apple ’cause of the phones and mobile, Google and

1:11:16  Howard Lindzon: Google ’cause of the phones and YouTube and the on YouTube store course the casino games all run on the app stores. Right. Like the free games that you have, they make a fortune

1:11:25  Barry Ritholtz: Off that Apple. Apple. Why not Amazon or Facebook? Amazon

1:11:27  Howard Lindzon: Just added to the beginning of the year ’cause of robots, axons in the

1:11:32  Barry Ritholtz: Portfolio. Not close to the Amazon web service ’cause of robots.

1:11:34  Howard Lindzon: Yeah, I mean it’s just am You can’t not own Amazon at this era in degenerate economy. ’cause they’re the center of it. Again, that’s which robot,

1:11:41  Barry Ritholtz: Which robot shops do. Like

1:11:42  Howard Lindzon: You can argue is a degenerate economy. But you have to own any

1:11:45  Barry Ritholtz: Of the robot builders you like.

1:11:46  Howard Lindzon: No. ’cause they’re too early. I mean personal investor in a few, but Clear, secure,

1:11:50  Barry Ritholtz: Give us some

1:11:51  Howard Lindzon: Names. Apron, which is just massive. Right. But again, it’s a personal investment. You

1:11:56  Barry Ritholtz: Have any interest in what Elon is doing with Gro and I

1:12:02  Howard Lindzon: Mean Yeah, but it’s a holding company. Like I, I don’t know what position.

1:12:05  Barry Ritholtz: It’s kind of random.

1:12:06  Howard Lindzon: So, so meaning

1:12:07  Barry Ritholtz: Tesla is a holding company for everything but SpaceX

1:12:10  Howard Lindzon: Or is that space gonna be the entity that goes public for

1:12:13  Barry Ritholtz: Space? SpaceX? I thought it was SpaceX.

1:12:14  Howard Lindzon: No, but I’m saying to SpaceX, why does he need two tickers? Like again, I don’t understand what the final being is. So why do I need to own some Elon holding company? I think I’m stupid. So

1:12:24  Barry Ritholtz: Because you’re betting on him and you don’t think he’s,

1:12:26  Howard Lindzon: Who cares? I’d rather bet on something. I understand.

1:12:29  Barry Ritholtz: Amazon, I’m with you. I’m not, I don’t disagree. I’m trying to

1:12:31  Howard Lindzon: F figure. Yeah. Another recent ad is it’s already doubled. It’s clear, secure, you know, clear. When you go through it, it’s lot clear. So to me if the world’s degenerate, you need security. So it’s more secure. It’s clear. Clear’s been a home run. They don’t have a lot of tech, but the great brand. Yeah.

1:12:45  Barry Ritholtz: And I thought they have tech isn’t it?

1:12:48  Howard Lindzon: I think they license a lot of the

1:12:49  Barry Ritholtz: Tech every, oh that’s not theirs. They don’t

1:12:51  Howard Lindzon: Own it. Yeah. So again, once you dig into a story, my conviction comes like how much of this they own, but they’re a hell of a brand and that the company’s been around forever

1:12:58  Barry Ritholtz: And they have the relationships. They’ve failed many times with FAA on the

1:13:01  Howard Lindzon: Airports and they can do so much more around stadiums. The brand matters.

1:13:05  Barry Ritholtz: What are you talking about? You go to watch a Nick game. It’s clear. It’s clear. Okay. You use clear on the way in.

1:13:10  Howard Lindzon: That was my bet. It’s just a clear trend. No one ever talks about it too. So it’s a massive uptrend and broke out and you never hear people talk about it. I like

1:13:20  Barry Ritholtz: You use either Chase Reserve or Amex, I wanna say platinum. You get, you get a credit towards any travel and Clear is just an automatic, it’s no brainer. Yeah. I’m Is it $150 a year? It’s fantastic.

1:13:34  Howard Lindzon: It’s, my son would call me and goes, that’s the greatest gift you ever got, man. I’m like, wow. When a 20-year-old knows something and an 80-year-old knows something. Those are good trends. Yeah. You know that’s a brand. Yeah. When it just a 20-year-old knows it not a brand.

1:13:45  Barry Ritholtz: Maybe it catches on. Maybe it doesn’t. Yeah.

1:13:47  Howard Lindzon: C-B-O-E-I love it. ’cause they power the whole thing. You can’t do this without C-B-O-E-C-M-E. The Merck, you know, is, you know, the New York Stock Exchange. Let

1:13:58  Barry Ritholtz: Me ask you a question, a direct investing question before we get to our favorite questions that I, I think a lot of investors have a hard time with. I started on a trading desk, so I’m okay with losses. It’s a given. But if you say to somebody, I want you to put a little money into these 10 or 20 stocks, half of them are gonna go outta business. Yeah. Maybe five or break even. You’ll make money on a couple and maybe one’s a home run. How do you deal with that? Really Fathead long tail. You not a math

1:14:29  Howard Lindzon: Guy indexing. I’m so into indexing. No, I

1:14:32  Barry Ritholtz: Mean on your, on your private seed state, like most of the seed investments you’re gonna make aren’t gonna give you return. It’s a great

1:14:40  Howard Lindzon: Question.

1:14:40  Barry Ritholtz: Return.

1:14:41  Howard Lindzon: I’m

1:14:42  Barry Ritholtz: Bearish. Do. Oh, I’m wrong all the time. I’m just

1:14:44  Howard Lindzon: Bearish on my industry. Right. I’d never, I believe it was a moment in time with Zer. I think it got the country through its unintended circumstances. We live in all these unintended circumstances.

1:14:55  Barry Ritholtz: Consequences, right?

1:14:56  Howard Lindzon: Yeah. Or ci. Yeah. Unintended consequences. Sorry,

1:14:59  Barry Ritholtz: By the way, not that you 60 wealthy, that happens a whole lot more.

1:15:02  Howard Lindzon: I’m wealthy just born at the right time. Lot of unintended circumstances. Zer is a good thing. Right? I’m not saying, I’m not saying I shouldn’t be ashamed, but

1:15:09  Barry Ritholtz: If you have assets, if you’re, if you’re a Yeah, a working stiff, it’s like I used to be, it was tough. Yeah.

1:15:15  Howard Lindzon: S and ps at all time highs, cash levels at all time highs. If I hear those two things together, what do I think of inflation? Right? It just has never been a better time to have assets. Right. It doesn’t mean I don’t know when it’s gonna end. I have cash and stocks. It’s a double whammy. The, the, so I’m lucky. I am so bearish on what I do for a living. Meaning what value do I add in a world of 6% interest rates tying someone up for 10 years when I could go buy sand disk right. In the public markets and get 6000% in a year. I’m not saying I’m smart enough to hold these things right? But in a world where Robinhood and a thousand Robin Hoods are gonna bloom, if you’re asking me my biggest bet, public markets do the work. You have an analyst in Claude, right? You can go see beaten up, no one’s following any stock. Everybody’s momentum investing. Go find 10 companies. So let, why would you do a startup investing? Every kid wants to be an angel investor. I’m like, dude, do it in the public markets. You have liquidity and you’re not locking up your clients for 10 years. But

1:16:17  Barry Ritholtz: You’re not answering my question. Okay. Which is how do you as an investor deal with the psychology of knowing most of your seed investments aren’t gonna work out? Is it just the nature of the beast? No. Or does that weigh on you at

1:16:33  Howard Lindzon: All? No, I think it, it aligned with how I thought of the world as as, as someone who believes their high integrity wishes, who, who wants people to believe they’re high integrity for my kids’ sake. And you know, the integrity of telling my investors that upfront is the release. Meaning I’m not telling my investors we’re gonna be 90% hit rate. If you give me money, you’re gonna hate me because you’re going to think the idea that I love is the dumbest idea. The Robinhood quote

1:17:02  Barry Ritholtz: Unquote Yeah. Dumbest idea I’ve ever had.

1:17:04  Howard Lindzon: You are betting on me to hang 30 pieces of art in Ma Howie’s gallery that Larry David Gallery and you will pick, and if I gave you the choice to invest in all 30, you would pick the two that went to zero. So you’re betting on me to dece the world my way. And then I’m not telling you we’re gonna make a hundred times our money, but my job is to find one company that’s a hundred bagger. Ah, okay. So I, so I have to know math, I have to do this, I have to have just get yelled up by my LPs when they read our quarterly letters and go, that was the dumbest idea. I’m like, you’re right. Like I’m embarrassed. But our job is to find a Robinhood and we found many of them, you know, life flock, Robinhood beehive. We just got one called alpaca. Again, a trend with no

1:17:48  Barry Ritholtz: Ai,

1:17:49  Howard Lindzon: Alpaca powers, a thousand Robin Hoods around the world. They’re like the eight modern apex. So I’m saying like, our job is to know what we know, take crazy bets and and sell that to our LPs is like, you’re investing for 10 years. This is like, you know, it’s not as good as it was in 2013 when rates were zero and, and, and now it’s a different game again. And I’m thinking like with you’ve got Claude and you can do an an, you can analyze the stock in like three seconds. I’m like the, the the, the everyone’s a CFA all of a sudden if they wanna be. Right. What a great time to be a public market investor. And yet everybody wants to be a private investor. So again,

1:18:29  Barry Ritholtz: It’s a it’s so funny coming from you. Yeah.

1:18:31  Howard Lindzon: Special. No, 2020. I’ve been writing about this since COVID is like, public markets are amazing because there’s so many stupid people making dumb bets on Robinhood and dislocation is everywhere and it’s only getting worse.

1:18:44  Barry Ritholtz: And the degenerative economy is gonna Dr. Continue driving this theme.

1:18:47  Howard Lindzon: Yes. And I think most people should index, but everybody should learn how to pick stocks too in this era.

1:18:53  Barry Ritholtz: I gotcha. Yeah. Alright, so it’s almost midnight. I only have you for a few minutes more and you have to end up at, at your events tonight. Cash awards tonight. Yeah. Cash Egg Awards

1:19:01  Howard Lindzon: And Breaking News. October Fest. October 6th. Coming back to New York. That’s our big event where

1:19:06  Barry Ritholtz: That’s

1:19:07  Howard Lindzon: Exciting. Yeah. A thousand people on the west side.

1:19:09  Barry Ritholtz: I’m, I am looking forward to that.

1:19:10  Howard Lindzon: October 6th if you want come hit me up.

1:19:12  Barry Ritholtz: Let’s do our speed round. Five questions,

1:19:16  Howard Lindzon: Two hours,

1:19:17  Barry Ritholtz: 10 seconds each. Okay. I’m gonna jump right into it. Starting with

1:19:21  Howard Lindzon: Boxers,

1:19:22  Barry Ritholtz: Who were your early mentors who helped shape your career?

1:19:26  Howard Lindzon: I think part, I hate saying this, I didn’t have good early mentorships, so I I really take pride in mentoring other people because I think Who

1:19:34  Barry Ritholtz: Were your later mentors? I hear Fred Wilson the

1:19:36  Howard Lindzon: Time. Yeah, you like people that I discovered, like the mentorship came from the community being the mentor led me, like Stock Twit being a giver opened me up to get mentorship. I think young kids are not getting good mentorship.

1:19:48  Barry Ritholtz: So just pure Karma. Karma. I love that. What are some of your favorite books? What are you reading right now? I know what you’re reading next. What are you reading now? Yeah,

1:19:56  Howard Lindzon: I got your, but I don’t read.

1:19:58  Barry Ritholtz: You’re on flights all the time. What do you do? Just movies.

1:20:02  Howard Lindzon: I’m so addicted to like HBO, Amazon.

1:20:06  Barry Ritholtz: So you’re watching series. Yeah, I

1:20:07  Howard Lindzon: Built, I’m just very into content

1:20:08  Barry Ritholtz: That content’s my next

1:20:09  Howard Lindzon: Question. What? But hang on. So you’re asking books. I still love the classic Shoe Dog for business. You know Phil Knight’s book? I love that. That was fun. I guess he’s biography. I I like stuff. I just, I just, my brain doesn’t work with books.

1:20:21  Barry Ritholtz: Huh. That’s really interesting. Yeah. Tell us what you’re watching on Netflix. HBO Amazon.

1:20:27  Howard Lindzon: I just rewatched the Nick. Have you watched the Nick on HBO Soderberg? Why does that sound so familiar? Oh, it’s about the 19 hundreds. The Knickerbocker Hospital.

1:20:35  Barry Ritholtz: No, I did not watch that best show. Really?

1:20:37  Howard Lindzon: This season it’s about, it’s like surgery wasn’t done until like Barbers used to do surgery in 1900. Right. All the rich oil guys started backing hospitals and that was the original tech surgery was tech. And it’s just an incredible period piece about the 19 hundreds and soho in New York,

1:20:57  Barry Ritholtz: Huh? I’ll check that out on hbo. It’s, give us one more.

1:21:00  Howard Lindzon: There’s very little good stuff on tv. I think Rooster’s pretty

1:21:03  Barry Ritholtz: Good. Can I tell you something from HBO

1:21:04  Howard Lindzon: Rooster’s

1:21:05  Barry Ritholtz: Is funny. You have that backwards. There’s okay, there’s too much to stuff,

1:21:07  Howard Lindzon: But I think I’ve seen it all.

1:21:08  Barry Ritholtz: Have you seen Landman

1:21:10  Howard Lindzon: Great. But that’s, that’s more like Harlequin romance kind of series. They’re fun to watch and the kids like ’em too.

1:21:16  Barry Ritholtz: Okay. But the Nick

1:21:17  Howard Lindzon: You’ll love ’cause it’s

1:21:18  Barry Ritholtz: Superior piece. You see three Body Problem if you want something a little more.

1:21:21  Howard Lindzon: No, but that’s sci-fi I think. I don’t like sci-fi.

1:21:23  Barry Ritholtz: You don’t like sci-fi? No, I just, so you didn’t watch The Expanse?

1:21:27  Howard Lindzon: No, I didn’t like that either. Oh my gosh. I try it and I never get into it, huh?

1:21:30  Barry Ritholtz: Yeah, that’s interesting. I like

1:21:32  Howard Lindzon: Degenerate stuff.

1:21:33  Barry Ritholtz: How do you feel about Spy, that sort of stuff? I love him killing Eve.

1:21:39  Howard Lindzon: Killing is good, was great. I like spice. I can rarely follow it. Well nine because I, I start have you start dozing up. Yeah, it was good.

1:21:46  Barry Ritholtz: Wow. Yeah. Really. How about any of the British period pieces? I,

1:21:49  Howard Lindzon: I love Brit Box. I watch

1:21:51  Barry Ritholtz: Bri Box. Alright, so the Crown Bridge, Bridger Tin,

1:21:54  Howard Lindzon: Not Bridgeton, but Brit Box is a great channel. Yeah, there’s that criter criterion for old movies.

1:22:01  Barry Ritholtz: If you have Brit Box, go back and watch. What was the name of that show? There was a show that came out around the same time as friends only coupling. And it had, oh, I’ll watch it. It has teeth. It’s, I mean, everything from the nineties is a little dated, but whereas friends was kind of milk toast and mushy. This has a sharp edge and it’s British, so it’s nasty and funny in a way that only the Brits can do.

1:22:28  Howard Lindzon: Okay. Yeah. So I’m a media fanatic, but not like I’m weird and I’m know that so bullish on YouTube, apple tv, YouTube

1:22:37  Barry Ritholtz: Is just great.

1:22:37  Howard Lindzon: I just love YouTube.

1:22:39  Barry Ritholtz: All right, so final two questions. What sort of advice would you give to a college grad interested in either becoming a seed investor or a startup entrepreneur?

1:22:53  Howard Lindzon: Well, I think there’s no shame in being a number two, number three or number four. So chief of staff is the new CEO. So go be someone’s chief of staff. Like, don’t worry about pay or title. Worry about finding something that’s working this way. It’s, it’s much easier to go work for a company that’s just working. So go like, ignore the title, ignore

1:23:16  Barry Ritholtz: Low end job at a,

1:23:17  Howard Lindzon: Ignore the salary, right? Find a rocket ship and attach yourself, whether it’s manscape, you’re gonna learn more. You’re either, you’re gonna be smarter people around, there’s gonna be, you know, less aggravation, more work, but hey, like, if you’re really serious,

1:23:32  Barry Ritholtz: But you gotta grind it out.

1:23:33  Howard Lindzon: I tell my daughter is like, if you’re really serious about this, it’s gonna take a lot of work, but go do it. If you’re not serious, be a socialist. Like, it’s okay, but like, don’t commit, don’t fool yourself. Like go work for a rocket ship. Otherwise, dude, who are you talking to? So like, there’s no room anymore for these kids that, like, if you wanna start a company, do you know it’s 24 7? Right? And if you, and no one’s gonna like you. And if you wanna be a number two, do you know what it takes to be a number two? So I’m like, be honest, but like, go work for a company that’s working

1:24:06  Barry Ritholtz: More. And our final question, what do you know about the world’s of venture and, and seed investing today that would’ve been helpful 65, 70 years ago when you were first getting started?

1:24:17  Howard Lindzon: No, I think I luckily got the right mentorship entered at the right time. I think you have to do it for a while. You gotta get a crop, like if you’re gonna go do wine or weather matters. And same with tech. Like what matters with tech is you have to get, if you, if you were of the Google Glass era, not much worked, right? If you were in the Blackberry Fund 2008, no go. No go baby. So, so

1:24:39  Barry Ritholtz: Unless, unless you could have been an early investor in Apple or when they were public, when the iPhone

1:24:44  Howard Lindzon: First came out, I, I think the public markets are underappreciated because seed investing became cool because of Zuckerberg and because of a few of these rocket ships. See, I

1:24:51  Barry Ritholtz: Thought seed investing or venture investing really became cool in the nineties and then in the 2000 it kind of faded. No, it became,

1:24:59  Howard Lindzon: No, it’s never been more in, it’s never been more loved

1:25:03  Barry Ritholtz: Today. Oh,

1:25:04  Howard Lindzon: I go see these young kids, they, it seems like they know nothing and they all wanna be venture invested. I’m like, yeah. Have you ever bought a stock, like you get wounded like day one, like stock drops 20%. Like go open a Robinhood account and learn how to invest. Like if you don’t know the public markets, what are you doing in the private markets?

1:25:21  Barry Ritholtz: Gotta graduate to private.

1:25:22  Howard Lindzon: Yeah. I think the most, the guys that got who were interesting to me, and I’m not saying they still are the crossover investors, the people that like knew the public markets and then started doing private. And I think that was my edge. I knew how pricing worked, how mar whether I was right or wrong. I understood how markets worked and the seed investing, the prices made sense to me relative to public markets. Now the prices in private markets make no sense to me,

1:25:43  Barry Ritholtz: Howard, it is always a blast. When you come in, you’re bucking Bronco. I never know where we’re gonna go. You are not Larry David, you are the Zach Galifianakis. Oh, I love Zach of, of finance. He was

1:25:56  Howard Lindzon: Just on Conan watch out episode.

1:25:57  Barry Ritholtz: I should, I should put two ferns in here just for your arrival. Thank you, by the way, for, for being so generous with your time. And good luck at the cash tags. Thank you awards tonight.

 

~~~

 

 

The post Transcript: Howard Lindzon, Social Leverage appeared first on The Big Picture.

Iran-Linked Media Floats Data Tax On Hormuz Undersea Internet Cables

An Islamic Revolutionary Guard Corps-linked media outlet has signaled that submarine fiber-optic cables running through the Strait of Hormuz remain in Tehran’s crosshairs.

Tehran views Hormuz not only as an energy chokepoint but also as a digital chokepoint, with undersea cables beaming internet across the Gulf and into the global network.

Source: Retuers 

Tasnim published an article titled “Three Practical Steps for Generating Revenue from Strait of Hormuz Internet Cables,” pointing out that Tehran must reassess how it exercises sovereignty over the strategic maritime chokepoint.

Source: Retuers 

The IRGC-linked outlet said that submarine fiber-optic cables in the critical waterway facilitate more than $10 trillion in financial transactions each day, and claimed that Iran has been deprived of the economic and sovereign benefits tied to the digital economy.

Source: Retuers 

Tasnim warned that any disruption, cut, or damage to these cables, whether from natural causes or ship anchors, could impose heavy losses on the world's economy.

"These cables, which are laid on the seabed using advanced technologies such as DWDM and double-armored standards, carry the bulk of international internet traffic, cloud synchronization, enterprise virtual private networks, voice traffic, and financial-payment networks. From the perspective of the digital economy, any disruption, outage, or damage to these communications highways, whether from natural incidents or ship anchors, can cause irreparable losses," the outlet stated.

Tasnim lists three steps for how Iran should begin imposing fees on internet traffic routed through Hormuz:

1. Licensing and tolls: Iran should require telecom consortia and cable operators to obtain permits for laying and operating cables through the strait, with initial licensing fees and annual renewal payments.

2. Iranian legal jurisdiction over tech firms: Major technology companies using the cables, including Google, Microsoft, Amazon, and Meta, should be required to operate officially under Iranian law and cooperate with Iranian technology firms, knowledge-based companies, and media entities.

3. Iranian control over maintenance and repair: Iran should develop the technical infrastructure to control or participate in the maintenance and repair of the cables, turning cable servicing into both a revenue stream and a sovereignty tool.

Beyond the quest to charge data fees, Tehran has already imposed fees or tolls on vessels passing through the strait.

Last week, Iran's newly created Persian Gulf Strait Authority pushed forward with a new protocol for commercial vessels transiting the strait. It’s unclear whether the protocol will incur a fee.

However, Iranians have made "demands for payments, payments for toll fees, as we say, for those vessels to be granted permission to sail," Dimitris Maniatis, CEO of maritime risk consultancy Marisks, told CNN.

The direct result of Tehran’s attempt to position itself as the gatekeeper of the Hormuz chokepoint, across energy, freight, and potentially digital traffic, will be to accelerate global efforts to bypass the strait. That means rerouting pipelines, tanker traffic, commercial shipping, and eventually undersea cable infrastructure away from Iran’s strait.

That effort has already started:

• World Starts To "Build" Around Hormuz; Japan Buying UAE Oil Bypassing Strait As ADNOC To Spend $55 Billion On Pipelines

.  . .

 

Tyler Durden Sun, 05/10/2026 - 09:55

What Would Be Truly Bullish? Actually Fixing What's Broken

Authored by Charles Hugh Smith via Of Two Minds,

We've come to an interesting juncture in history, interesting because while we're being assured that AI will solve all problems, including any it creates, back in the real world, AI is incapable of fixing what's broken because too many people are getting rich off the status quo, and since the status quo is the problem, those who own / control AI will use it to maintain the status quo, guaranteeing that what's broken spirals into irreversible breakdown.

Richard Bonugli and I discuss what's fatally broken in a new podcast on what it will take to become Bullish (32 min).

Let's start with what's "obvious": letting what's broken fester until it implodes the status quo is not bullish, and neither is substituting delusion and denial for a realistic appraisal of what's actually broken--the essential observe and orient steps in the OODA loop (observe, orient, decide, act).

I've often described the two dynamics that are broken that AI can't fix because those who own / control AI are using it to increase the asymmetrical distribution of wealth and income that are the source of breakdown. Consider healthcare. Everyone except the managers / owners / shareholders of healthcare / pharma cartels agrees healthcare is fundamentally broken and is bankrupting households, employers and the government / nation.

Those profiteering off the status quo healthcare system claim AI is going to reduce costs. They fail to mention this won't reduce the price, it will only serve to increase their profits. Cut costs by replacing human labor with AI tools, yea, we reap even higher profits. Nobody is claiming healthcare will magically become affordable because a truly affordable healthcare system wouldn't be as profitable because it wouldn't be as open to exploitation, fraud, profiteering, extraction and parasitic pricing.

In the same way, AI can't solve the other fatal dynamic--widening wealth and income asymmetry--because it's widening the asymmetry to new extremes. The owners of AI are reaping vast fortunes while stripmining resources to run their AI data centers and laying off wage earners. Rather than fixing what's broken in America, AI is accelerating the endgame of what's broken.

Let's run through why increasing numbers of online comments suggest burning the whole rotten healthcare system down and starting over. Healthcare insurance--which often turn out to be a profitable facsimile of actual insurance--has more than doubled beyond the official rate of inflation. If healthcare insurance had tracked inflation, it would cost $10,000 a year for family coverage in 2026. Instead, it costs $25,000+ annually.

Diagnosis: broken.

Regardless of how you toy with statistics, the reality is administrative costs / bloat / profiteering have soared. Diagnosis: broken.

Meanwhile, back in reality, rapidly aging populations are far from their peak demand for healthcare services. Check out the white line on this chart (courtesy of @econimica) of those aged 65+. While births collapse and the workforce is pressured by AI and the soaring cost of living, millions of elderly retirees are being added to the Medicare beneficiary pool. Diagnosis: broken.

Here is the chart of Medicare costs: parabolic. It's nice we can borrow a few trillion every year, but can we borrow $5 trillion or more every year with no consequence? Diagnosis: broken.

Here is the chart of Medicaid costs: parabolic. Diagnosis: broken.

As for the health of the general populace: it's been declining for two generations as our diet has shifted from real food made at home to ultra-processed goo and fitness has bifurcated into a thin layer of extreme fitness and a majority of the populace burdened with the complex ill health of poor diets, poor fitness and metabolic disorders.

Weight of the populace in 1985:

Weight of the populace in 2023:

Yes, now we have GLP-1 drugs that reduce weight and the diseases related to weight, but these drugs have side effects in many patients and they must be taken for life. Once the patient stops taking them, the weight returns.

Drugs that must be taken for life are not a substitute for being healthy. Healthy = not needing any medications.

Diagnosis of the healthcare system: broken. Prognosis: bifurcation: the rich will get "the finest care in the world," and everyone else will be in a queue or denied care--basically the same result--or offered extraordinarily profitable meds and a spectrum of side effects.

What's broken is the entire financial-economic system that distributes the pain and the gain: the pain of sharply higher costs of living and increasing financial precarity is distributed to the bottom 80% while the gains are distributed to the top 10%, with a dribble going to the cohort between 81% and 90% who own enough capital to support their claim to being "middle class."

Note to America's elites: when only the top 15% just below the top 5% qualifies as "middle class," that's not a middle class. I know, you don't concern yourselves with such trivia: there are trillions of dollars to be reaped "solving problems" with AI.

The "problem" you can't solve with AI is AI only "solves" the "problem" you see, which is how to increase your wealth and income before the bottom 80% awaken from the 24/7-hyped delusion that credit-asset bubbles (AI!) raise all boats and will continue to do so forever and ever.

Real life has diverged from that delusion, and the radioactive power of AI to extend that delusion has a short half-life. Refusing to recognize, much less actually fix, what's broken hurries our collective rendezvous with consequences.

What would be bullish is actually fixing what's broken. Promoting self-serving illusory "solutions" that only widen the asymmetries stretching the socio-economic fabric to the breaking point is not bullish.

New podcast: what it will take to become Bullish (32 min).

My book Investing In Revolution is available at a 10% discount ($18 for the paperback, $24 for the hardcover and $8.95 for the ebook edition). Introduction (free)

Tyler Durden Sun, 05/10/2026 - 09:20

Housing Cost Pressure Varies Widely Across The EU

Housing affordability in the EU has an uneven spread across the continent according to data from Eurostat.

As Statista's Jack Lillis details below, the share of people whose housing costs exceed 40% of disposable income ranges from as low as 2.4% in Cyprus to as high as 28.9% in Greece.

The EU 27 average stands at 8.2%, but this figure masks significant disparities between countries.

You will find more infographics at Statista

After Greece, Turkey appears among the most heavily burdened, while countries like Finland, Sweden, and France sit at the lighter end of the scale, suggesting considerably lower housing cost pressure on their populations.

The disparities carry real implications for labor mobility and quality of life.

In countries where housing consumes a disproportionate share of income workers in lower-wage sectors, such as the hospitality industry, could face particularly acute pressure.

Tyler Durden Sun, 05/10/2026 - 08:45

The Most Direct Social Engineering Propaganda You'll Ever See

Authored by Steve Watson via modernity.news,

A new Channel 5 drama series has delivered what many are calling peak social conditioning: a classroom scene where a teacher is berated by students for failing to instantly adopt preferred pronouns and for daring to stage Shakespeare’s A Midsummer Night’s Dream.

A clip, shared widely on social media, shows an old-school drama teacher clashing with pupils over basic biology, literature, and “respecting identities.”

In the footage, a student corrects the teacher when she uses the wrong name for a student who has decided to swap genders and adopt new pronouns: “Their name is Dee now actually,” one student explains, adding “you just deadnamed them Miss.”

Channel 5 has always been wank and only MASSIVE wankers watch it!

But I think I've found the most Wanktarded woke TV show ever!

This wank even out wanks the BBC!

Not only is it woke wank!

It tries to shit on Shakespeare’s legacy!

This is what commie wankers do! pic.twitter.com/AUR07lfSVb

— Wanker Finder (@IfindWankers) May 5, 2026

The teacher responds: “I’m sorry. I’ve known you as Daphne for two years and can’t click a switch. I am trying.”

Another insufferable student fires back: “You shouldn’t have to try. You either see them or you don’t. I think you should apologise.”

The teacher then puts her foot in it again and states: “I just did, and am sure she can fight her own battles!”

“It’s they not she… It’s about respecting other people’s identity,” the student lectures.

Later, students challenge the Shakespeare choice, with one suggesting “There’s a consent issue. Titania is drugged before sleeping with Bottom… It’s also anti-feminist portraying women as submissive and dependent on men… to a modern audience it could be quite triggering.”

The scene perfectly captures the absurdity: instant language policing, classic literature deemed harmful for not meeting 2020s standards, and virtue-signalling students demanding deference.

This isn’t subtle. It’s overt social engineering dressed as entertainment.

This fits a well-established pattern and has been ongoing for years, as documented in the videos below:

Freedom of Information releases have confirmed the extent. UK ministers met with BBC and ITV bosses to insert pro-vaccine storylines into EastEnders, Coronation Street, and more during the pandemic, using “entertainment” to nudge compliance and shape opinion.

The BBC also used its Doctors soap to normalize the “furry” subculture, complete with lines like “You accepted their gender so why not this?”

Channel 5’s The Teacher takes it further by framing resistance to this ideology as outdated and problematic, while portraying demanding students as enlightened.

The drama reduces complex cultural heritage and language to potential “harm,” training audiences — especially younger ones — to view traditional education and biological reality as suspect. It’s not storytelling; it’s a masterclass in cultural reprogramming.

British broadcasters, taxpayer-supported or not, continue embedding these agendas. FOI documents prove coordination between government and media to “nudge” perceptions on everything from vaccines to identity. What starts as classroom lectures in fiction becomes pressure in real schools and workplaces.

This latest effort on Channel 5 strips away any pretense. It’s propaganda in plain sight — mocking Shakespeare, enforcing pronouns on demand, and shaming anyone who can’t “just flip a switch.”

Viewers are noticing. The pushback is growing as more see these shows not as harmless drama, but as tools to reshape society one scripted confrontation at a time.

Your support is crucial in helping us defeat mass censorship. Please consider donating via Locals or check out our unique merch. Follow us on X @ModernityNews.

Tyler Durden Sun, 05/10/2026 - 08:10

Maersk CEO Warns Iran War Is A "New Wake-Up Call" For Global Trade

It is becoming increasingly clear that reopening the Strait of Hormuz has become a top U.S. priority (really a global priority) , as oil executives and industry insiders warn that the clock is ticking toward an energy and global trade shock if the maritime chokepoint remains closed for another month.

Frederic Lasserre, head of research at Gunvor, one of the world's largest oil traders, warned earlier this week: "The tipping point is clearly June. This is the point at which something has to give."

JPMorgan analysts warned that the world is spiraling toward a catastrophic cliff-edge shortage of crude oil if the maritime chokepoint is blocked for another four weeks.

Speaking to CNBC's "Squawk Box Europe" earlier this morning, Maersk CEO Vincent Clerc warned that a "new wake-up call" has emerged beyond energy markets and that if the Hormuz chokepoint remains shuttered, it could severely impact global trade in the coming months.

Clerc was speaking to CNBC after Maersk reported a plunge in profitability and kept its guidance unchanged, but warned that the US-Iran war and the resulting Gulf energy shock are "dominant forces shaping the macroeconomic outlook, as well as the trade and logistics environment."

Maersk wrote in its earnings report that the Iran war had introduced an "additional layer of uncertainty."

"Currently, fragile ceasefires are in place in both Iran and Lebanon, negotiations proceed slowly, and traffic at the Strait of Hormuz remains at a near-standstill. The conflict has already weighed on sentiment. Consumer confidence deteriorated," the shipper said.

Maersk warned that crude oil prices in the $90 to $100 per barrel range and continued Hormuz chokepoint disruption would soon begin hitting global container demand, which is still expected to grow between 2% and 4%.

It noted that the balance of risks is "on the downside and more adverse outcomes cannot be ruled out."

"Energy and shipping disruptions in the Strait of Hormuz are rapidly reshaping global supply chains," Maersk said in the earnings report. "After the recent tariffs on U.S. imports, the conflict represents another wake-up call to deploy new tools to make supply chains more resilient and develop new strategies to mitigate future disruptions."

We pointed out earlier this week:

• Trump's Project Freedom Likely Triggered By Oil Market's One-Month Countdown To Chaos

Latest as of Thursday morning:

• Oil Slides On Reports Of 'Breakthrough' Coming For Stuck Ships In Hormuz, As US Awaits Tehran's Response To Fresh Proposal

It is increasingly evident that another month of Hormuz disruption represents a critical tipping point for energy markets and the global economy. If the conflict extends through June and the chokepoint remains shuttered, first-order impacts would likely worsen across Asia and Europe, where dependence on Gulf crude, refined products, LNG, and container flows is highest. From there, the shock could spread into fuel shortages, factory disruptions, higher shipping costs, and broader economic turmoil.

The clock is ticking.

Tyler Durden Sun, 05/10/2026 - 07:35

AI Is Losing The PR Battle And The Consequences Could Be Huge

Authored by Donald Kendal via The Epoch Times,

Lately, when watching high-profile sporting events like the NBA Playoffs, you may have noticed a rash of commercials for artificial intelligence (AI) companies. While average commercials strive to show off new products or services or recruit new customers, these AI commercials seem to have a different primary objective. They seem to target goodwill.

Heartwarming commercials show families bonding over AI-generated memories, where AI brings life to old family photos. Emotional voice-overs promise connection, creativity, and even nostalgia. These AI companies are trying to sell people a good reputation.

This strategy should tell us something. Companies don’t often spend millions trying to make you feel good about their brand unless they know, deep down, that you don’t trust it.

Despite hundreds of billions of dollars pouring into AI development, the industry is quietly losing the battle for hearts and minds. And sentimental advertising is not doing much to fix this problem.

Rare Bipartisan Agreement on AI

A new national survey from Marquette University Law School should give the AI industry serious pause. According to the poll, roughly 70 percent of Americans believe artificial intelligence will do more harm than good for society. Even more striking, the skepticism cuts across party lines.

Poll Director Charles Franklin put it bluntly: “It really is striking … there’s pretty much bipartisan skepticism … That’s an awful lot of partisan agreement, where we normally see Republicans and Democrats on opposite ends.”

In today’s political climate, bipartisan agreement on anything is rare. On AI, however, Americans seem united, just not in the way Silicon Valley might hope.

Worse yet is the fact that this poll supports similar findings on AI skepticism from numerous other surveys. A particularly damning NBC News poll from last month showed that AI’s net favorability rating ranked lower than nearly every other topic.

Why the Left and Right Don’t Trust AI

The industry is up against stiff headwinds in its battle for public trust.

For every story about the potential for AI curing diseases or boosting productivity, there are headlines about job displacement, algorithmic bias, and systems behaving in ways even their creators don’t fully understand.

We’ve seen AI tools generate historically inaccurate content in the name of ideological goals. We’ve seen concerns about “woke AI,” where outputs appear shaped by political preferences rather than objective reality. We’ve seen warnings from industry leaders themselves that these systems could eventually escape human control.

At the same time, public trust in the institutions building AI is already fragile.

Progressives have long been skeptical of massive corporations wielding outsized economic power. They also raise concerns about the environmental footprint of massive data centers and the risk that AI-driven productivity gains will further concentrate wealth among a small group of industry elites.

Conservatives, meanwhile, have grown increasingly wary of Big Tech after years of content moderation controversies and corporate activism tied to ESG-style frameworks.

In other words, both sides of the political spectrum are looking at the same handful of companies building the most powerful technology in human history while wondering if they can be trusted.

The Political Winds

AI companies should understand that this skepticism won’t stay confined to opinion polls. These poor poll results and negative stories in the media are giving bountiful ammunition to policymakers who are looking to target the burgeoning AI industry.

Lawmakers are beginning to float a wide range of proposals aimed at regulating artificial intelligence, some narrowly tailored, others sweeping in scope. Certain efforts are understandable, particularly those designed to prevent abuses similar to what we saw during the height of the Big Tech censorship debate.

Some proposals go further.

Some policymakers seek to impose heavy restrictions on AI, computational infrastructure, or model development. In New York, legislative proposals aim to restrict AI models from offering guidance on medical, legal, or professional issues.

A major threat to the industry is a proposal from the likes of Sen. Bernie Sanders (I-Vt.) and Rep. Alexandria Ocasio-Cortez (D-N.Y.) to impose a moratorium on the construction of AI data centers. This would essentially slow AI development in the United States to a crawl, potentially giving adversarial countries like China a great advantage in the AI race. In this scenario, the future of AI could then be left in the hands of governments that care far less about individual liberty and personal autonomy.

Earning Public Trust

If the AI industry wants to win back public confidence, it will need to do more than produce emotionally manipulative advertisements. It will need to address the concerns driving that skepticism in the first place.

Americans don’t want AI systems that nudge them toward preferred political outcomes, filter information through ideological lenses, or act as invisible referees of acceptable thought. They want assurance that these tools of the future act on objective truth rather than political ideology.

That means committing to principles that protect individual liberty and personal autonomy. It means transparency in how systems are trained and deployed. It means resisting pressure from governments, activist groups, or corporate interests to embed subjective values into systems that increasingly shape public life.

This route is possible. Elon Musk, for example, has acknowledged the importance of free expression and open inquiry in AI development. But this course needs to be fleshed out, fully implemented, and become an industry standard.

Without clear, consistent standards, suspicion will remain that there is a political agenda behind the interface.

The Fate of AI Is Not Set

The trajectory of artificial intelligence development may be inevitable, but there are many questions that need to be answered.

The best way forward for the AI industry is not through carefully crafted marketing campaigns, but a deliberate effort to earn public trust. That trust must be built on transparency, commitment to truth, and clear respect for individual liberty and personal autonomy.

If these companies want to usher in a new era of prosperity powered by AI, they must show the public that this technology will serve people, not shape or control them.

Tyler Durden Sun, 05/10/2026 - 07:00

The Return Of History: Deutsche On Gold, The Dollar, & The Monetary Future

Authored by Mallika Sachdeva and Michael Hsueh via Deutsche Bank Research Institute,

In 1989, Francis Fukuyama argued that humanity had reached “the end of history”. In the years that followed, the US became the uncontested hegemon, global trade exploded in a US-defined liberal order, developed market central banks sold gold, while emerging markets accumulated vast amounts of US dollar FX reserves. We argue that the end of history has come to an end. The world is back in a superpower struggle; the US is retreating from free trade, alliances, and security provision; the Great Economic Moderation is behind us; and the dollar banking system has been weaponized. The “return of history” has big implications for gold and the dollar.

Contrary to conventional thinking, we argue that the share of gold in central bank reserves is not driven by the global monetary system, but by the global geopolitical environment. Gold’s decline as a share of reserves did not happen with the fall of Bretton Woods in the 1970s, but the fall of the Berlin Wall and the assertion of US hegemony in the 1990s. As tectonic geopolitical plates shift again, the share of US dollars in central bank reserves is once more in decline. It has fallen from over 60% to just 40%, while gold’s share has tripled from its lows to 30% today.

We create a framework for the share of gold in central bank reserves as a function of: (1) the volume of gold held by central banks; (2) the price of gold; and (3) the amount of global FX reserves. We see all three pillars on the move, driven by EM. EM central banks have been actively buying gold and driving upward pressure on prices; crucially - their FX reserves may also now begin to structurally decline.

A “return of history" would be consistent with gold getting to at least a 40% share of global reserves. There is significant scope for EM to add towards this. We find that EM countries with closer non-Western defence ties hold more gold. If the world diversifies trade and security dependence away from the US, this would be consistent with less USD and more gold in reserves.

We simulate a range of different outcomes for gold prices depending on the level of FX reserves EM central banks end up with, and the share of gold they target. Even in an environment where EM FX reserves decline to USD5tn, gold prices could still rise to $8000 over the next five years, if EM countries all target a 40% gold share.

For now, EM central bank gold buying likely has to do with preserving the value and accessibility of foreign savings in a changing geopolitical climate. But in the long-run, we consider how gold may one day play a role in anchoring a monetary order that builds independence from the dollar.

All that glitters

The reserves baton is passing back to gold from the dollar

The share of the USD in global central bank reserves has dropped sharply from around 60% at its peak to just 40% today, with attrition accelerating in the past few years. As Figure 1 illustrates, the USD's share of reserves peaked at the start of this century and sustained those levels for the next two decades before recent losses Importantly, the dollar's losses as a share of central bank reserves have not gone to other fiat currencies, but to gold.

Gold's share in global central bank reserves has doubled in the past four years to nearly 30% today. The fact that the gap between the dollar and gold as a share of reserves is now just 10% is extremely notable. As Figure 1 shows, there appears to be a marked reversal underway of the 1990s trend when central banks moved away from gold and towards the USD in their reserves. Before the 1990s, gold had consistently been a larger share of central bank reserves than the fiat dollar. But by the end of the 1990s, the dollar was over four times the share of gold. This seems to now be going in reverse with gold clawing back its share rapidly. What happened in the 1990s and why is this unwinding today? How far can it go and to what end? These are the questions which motivate this paper.

The 1990s began with a declaration by historian Francis Fukuyama that humanity had reached "The End of History." We argue in this paper that history has returned, but the contest and its leaders will be different. This is the lens through which we think about the resurgence of gold, the decline of the dollar, and the international monetary architecture that may await us this century.

 

Let's address the skepticism. Skeptics may say the rising share of gold in central bank reserves is simply reflective of gold price increases. Indeed, around 80% of the rise in gold's share has been on account of prices. But there is a genuine volume driver underlying this: central bank purchases have arguably themselves been behind significant price momentum. There is indeed a close relationship between official purchases and sales of gold and the change in the real gold price (Figure 2). Volume and prices are thus endogenously related and are both doing the legwork of gold's rising share.

 

Crucially, all central bank purchases are occurring in emerging markets. As Figure 3 illustrates, it is EM central banks that have been steadily purchasing gold since the 2008 GFC, adding over 225mn troy oz over the past 17 years. Importantly, this is more than advanced economy central banks sold in the 1990s. As we discuss in depth in this paper, we think there could be a long way to go in the trend of EM central bank buying of gold.

EM central banks still only hold half the amount of physical gold of developed markets. In stock terms, EM central banks held 367mn troy oz at the end of 2025 compared to 712mn troy oz by Advanced Economy central banks, according to IMF classification. This has however been on a steadily rising trend. The ratio of EM/DM central bank gold holding is at around 52%, having risen from just 20% before the 2008 GFC (Figure 4).

As a share of total reserves (including foreign exchange holdings), which is where our focus in this paper lies, EM central banks had just 16% of total reserves in gold compared to 34% for DM central banks by end-2025. There thus remains a significant gap to close, if not ultimately exceed.

This is not just about the BRICS. Almost half of EM central bank holdings are accounted for by just China, Russia and India. But many middle powers like Turkiye, Kazakhstan, and Saudi Arabia are also significant holders (Figure 6).

Perhaps most notable in recent years is the momentum of purchases in certain regions. Strikingly, in Eastern Europe, more than half of the gold holdings of Czechia and Poland have been acquired in the past four years alone, after Russia's invasion of Ukraine (Figure 7).

Many MENA states like Qatar, Egypt and the UAE have acquired between 25- 50% of their total gold holdings in the last few years alone. We will be exploring the motivations for these purchases in more detail later in the paper.

A brief history of gold

Gold was the heart of Bretton Woods but did not fall with it

The US had over 70% of the world's central bank gold reserves after World War 2, and in constructing the Bretton Woods monetary architecture, it used gold to back a system that centered on the dollar.

As Monnet and Puy (2019) explain, the Bretton Woods system - which followed WW2 and lasted till 1971 - was not like the gold standard that preceded World War 1, or that was tried unsuccessfully in the interwar period. Under Bretton Woods, gold was not redeemable against bank notes at a fixed rate everywhere in the world. Nor were central banks strictly required to back currency in circulation with gold reserves. Only the US dollar was convertible into gold at $35/oz by other central banks via the Fed. Gold was essentially only a means of settlement between monetary authorities. Foreign countries could choose to hold their claims on the US in US dollars, or exchange them for gold. As the US began to run balance of payments deficits in the 1950s and 60s, some European countries began to make claims on the Fed's gold. By the mid-1960s, more gold was held at European central banks than in the US (Figure 8). By 1971, the system collapsed with Nixon ending the US dollar's convertibility to gold.

Gold did not however drop as a share of central bank reserves with the fall of Bretton Woods. Even as gold stopped serving a purpose as an official means of international settlement, gold averaged around a 50% share of central bank reserves through the 1970s, albeit with significant gyrations. Notably, it remained more important than the fiat dollar throughout the decade as the earlier Figure 1 depicts. Indeed, the 1970s were a period of enormous price gains for gold which rose more than 1000% in nominal terms through the decade driven by high inflation and geopolitical shocks from the 1973 Arab oil embargo, to the Iranian revolution (Figure 9).

Therefore, even as the global exchange rate system changed in the 1970s, gold's share in global reserves did not. This points to deeper and different drivers of gold's role. If central bank gold holdings in reserves were not ultimately only about convertibility of the USD, what were they about? And what brought about the change? We turn to this next.

The end of history

The ultimate decline in gold's share in global central bank reserves came in the 1990s. As Figure 1 earlier showed, gold fell below the dollar's share at the start of the 1990s, with the rest of the decade featuring a consistent rise in the dollar and decline of gold. What was behind this crossover?

It was not a transition in the monetary system - which had occurred two decades prior - but a shift in the geopolitical environment that changed the role of gold.

In 1989, Francis Fukuyama questioned whether humanity had reached "the end of history?". A lot of the 20th century had featured ideological violence, but the ending of the Cold War he believed brought a "triumph of the West, of the Western idea," "the endpoint of mankind's ideological evolution" and the "unabashed victory of economic and political liberalism." The Berlin Wall fell the year of his thesis, and the Soviet Union had fully dissolved by 1991. The US thus became an uncontested hegemon in what appeared to be a geopolitically unipolar world. Japan, which had been the US' closest economic competitor, was well within the US security and dollar system, and China was still a decade from joining the WTO.

In the economic realm, a lot was changing in the 1990s from the turbulent decades that preceded it. In the US, a "Great Moderation" was underway. Inflation was falling with tight monetary policy having tamed the price instability of the 1970s and 80s. Indeed, average inflation in the 1990s was 2.5% below 1980 averages. The US was running growing fiscal surpluses. The US fiscal position was 1.5% GDP better in the 1990s than in the 1980s on average (Figure 10). The combination of better inflation and fiscal data, and independent central banking raised trust in monetary and fiscal systems, making US Treasuries a more attractive safe asset. Unlike gold, Treasuries paid a positive yield, had a deep and liquid market which made them easy to hold and transact in, and had no storage costs.

Developed world central banks led by Europe thus began to sell gold reserves in the 1990s (see again Figure 2), which came to be seen as a "barbarous relic" (Arslanalp et al, 2023). Countries like Switzerland, UK, Belgium, Netherlands, Austria, Australia, Canada all sold gold. Gold was seen as a vestige of the past, a zero-yielding asset with little role to play, especially in a world where European countries were moving towards a common currency. As gold sales began to impact the price of gold, central banks formalized a Central Bank Gold Agreement to coordinate sales in 1999, a framework that lasted for the next two decades.

Stabilizing geopolitics, combined with large improvements in technology, communications and transport, led to an explosion in trade and globalization in the 1990s. Trade in goods and services close to doubled as a share of global GDP from 1990 to the 2008 GFC (Figure 11). A rise in global trade contributed to the deepening in dollarization via the channels of invoicing, finance, and the accumulation of dollar surpluses in exporting EM economies. This brings us to arguably the biggest driver of gold's relative decline against the dollar.

The biggest driver of the decline of gold's share in global central bank reserves in the 1990s was the meteoric rise of emerging market FX reserves, held in dollars. As Figure 12 illustrates, global reserves began to rise in the 1990s. Japan was the biggest driver in the 1990s, with the baton passing to China in the 2000s alongside a wide swathe of EM countries from Russia, to Saudi Arabia, India, Korea, Taiwan, Brazil and others. The total amount of global FX reserves went up 9 times between 1990-2007. A majority of these reserves were built in USD and saved in US Treasuries given the predominance of the US driven economic and trade order. The Asian Financial Crisis in the late 1990 also led to a deeper preference for self insurance by EM countries and a dramatic shift in favour of building reserves, after the failures of capital account liberalization policies. The IMF itself shifted to encouraging reserves adequacy frameworks that stressed savings in USD liquidity.

Bringing it all together: one can think of the share of gold in central bank reserves as a function of three things: (1) the volume of gold held by central banks; (2) the price of gold; and (3) the amount of foreign exchange reserves. The former two influence the numerator, while the latter influences the denominator. The decline of gold as a share of global central bank reserves from around 40% on the eve of the 1990s to just 10% by the eve of the GFC was predominantly about the denominator. While developed world central banks were selling gold in the 1990s, this was in fact largely offset by the price increase of gold (Figure 13).

In sum, the biggest driver of gold's decline in global reserves in the 1990s was the rise of EM FX reserves accumulated in USD. This was in turn a function of dramatic globalization, in a US-driven neo-liberal unipolar order, amidst sound and improving economic fundamentals in the US. By extension, the dollar's fate as the world's reserve currency will have a lot to do with how these same countries treat their USD holdings in a de-globalizing world in which the US driven order is fraying: do EM countries still add to USD reserves, diversify away from them into gold, or actively draw them down? The future of the dollar as a reserve currency could well be determined in emerging markets, consistent with our thesis that the Global South will be a much bigger economic and geopolitical force to understand.

The return of history

The drivers of the "end of history" have almost all been going in reverse. The world is back in an ideological struggle between competing economic and political models, this time led by the US and China. Both countries are engaged in growing competition across technology, energy, resources, and influence.The world is no longer unipolar. China is on many metrics a bigger industrial, trade and naval power than the US.

The US is stepping back from free trade and fracturing traditional alliances, with China having positioned itself to step into the fray with years of building trade and investment relationships across the Global South. The provision of global public goods guaranteed by the US - namely freedom of navigation and security for key allied regions - has come into question with the closure of the Straits of Hormuz and the vulnerability of the Gulf in the latest conflict.

If the 1990s was a world where the US was happy to outsource manufacturing and labour to EM, with many EM countries happy to outsource security and savings to the US, this is now reversing. The US is keen to onshore more critical manufacturing, while many EM regions like Asia and the Gulf will be reconsidering their need for strategic autonomy in areas like energy and defence. They may well need the savings they have been investing in the USD to build these capabilities.

On the economic front, the Great Moderation is behind us. US inflation has been above target for over five years, independent central banking has come into question, monetary balance sheets have expanded dramatically under QE, and the US fiscal trajectory is on a worrying path.

Finally, the weaponization of the US dominated banking system with the freezing of Russia's USD and EUR FX reserves in 2022 has increased the appeal of saving in gold, which can be held physically and locally, away from the arm of sanctions or asset seizures. Indeed, Russia and China hold 100% of their gold locally.

The end of history has itself come to an end, with significant implications for gold and the dollar, which are becoming increasingly apparent.

What the future may hold

EM is not only buying gold, but could soon be selling the dollar too

As discussed earlier, gold's share in central bank reserves is a function of three main drivers: the volume of gold held, the price of gold, and the stock of FX reserves. For emerging market central banks, all three are on the move.

First, EM central banks have been actively buying gold. EM purchases since 2008 exceed the sales made by developed world central bank sales in the 1990s. Figure 14 illustrates the biggest buyers in volume terms since 2008, split between purchases before and after Russia's invasion of Ukraine (2008-2021 and 2022-25). It is notable that Russia had actively diversified into gold ahead of 2022 (Figure 14).

China has continued to purchase gold at roughly the same pace since 2022, while countries in Eastern Europe, India, and MENA have accelerated gold purchases since then.

It is important to note that our analysis in this paper focuses on IMF data on central bank reserves, which understates the true accumulation of EM official savings in foreign assets. We have chosen to focus on IMF data for a range of reasons: longer time-series history of the data, comparability to COFER estimates of central bank FX holdings, and availability of country level data series. But there are important caveats to this data. While IMF data shows EM central bank reserves have been stagnant in recent years, EM countries have in fact continued to build and recycle savings abroad via large sovereign wealth funds, state banks, and public pension funds. A significant amount of these savings are held in USD, but often with a riskier, less liquid profile across equities and private markets rather than necessarily US Treasuries. Global SWF pegged sovereign wealth fund holdings in Asia and MENA at over USD12tn in March 2026, greater than the size of their central bank holdings.

If IMF data on central bank reserves is understating the true extent of official foreign savings in EM, it is also understating the full extent of official diversification into gold. Indeed, a series by the World Gold Council (WGC) that tracks quarterly demand by "Central Banks and Other Institutions" and is believed to include sovereign wealth funds and other state-directed flows, shows gold purchases at three times the pace of the IMF series since 2022 (Figure 15). IMF data shows roughly 10 mn troy oz of annual purchases in the past four years by central banks, while the WGC series pegs this at over 30mn troy oz or over 1000 tonnes per year. While this does not change the trend or conclusions of this paper, it does suggest scope to magnify already significant implications.

Second, central bank purchases are driving upward pressure on gold prices. Central banks and official institutions as defined by the WGC have accounted for over 40% of the investment demand for gold since 2022, excluding demand for jewelry, technology and industrial purposes. ETF purchases which picked up meaningfully last year may themselves be piggy-backing off the consistent underlying bid from central banks. A simple regression that looks at central bank and ETF demand suggests that every 1 mn troy oz of purchases leads to a 1% increase in the gold price (Figure 16). We adopt this as a simple back-of-the-envelope heuristic, to be used in analysis below.

Third, the enormous build of foreign exchange reserves in emerging markets may now go into reverse. As discussed above, the dramatic rise of the dollar's share in global central bank reserves in the 1990s had almost everything to do with the sharp rise in EM reserves. There is a possibility that EM reserves may begin to decline from here. This would be motivated less by foreign investor capital exits or the need to defend currencies, but as countries in Asia and the Gulf draw on their savings to build strategic autonomy in defence and energy, which will require capital, imports and investment. While a majority of the roughly USD8tn in EM central bank reserves are held in China, a significant share are also in Asia ex-China and Middle East & Central Asia (Figure 17). Recent reports that the UAE has asked the US Treasury for a currency swap, suggests the need for USD liquidity. Indeed, the Gulf may turn to their savings not just to tide over the effects of the ongoing war, but for rebuilding efforts, to address economic scarring and diversification needs, and ultimately to build greater domestic defence resilience.

The first two forces are already underway. EM central banks have been actively buying gold and prices have been rising. The third force of active reduction in US holdings is yet to begin, but could be very significant. All three drivers could be at play together, suggesting there is more to go in gold's rise and the dollar's decline as a share of global reserves. Where might they end up?

What share of reserves should gold be?

The combination of gold purchases and price rises has already pushed gold's share of global central bank reserves to around 30%. Where might we go from here?

There is likely still a long way to go. We begin with the key observation that before the 1990s, gold's share of reserves fluctuated between 40-70% of total reserves as illustrated in Figure 18. "The return of history" we described above should make getting to the lower bound of this range - or 40% for gold's share - a reasonable initial target. If the world is going back to looking like it did before the 1990s - with geopolitical competition between superpowers, high inflation, and less universal support for free trade - then it may make sense to expect gold's share of reserves to also go back to similar levels. While before the 1990s, emerging market central banks held very little total reserves, today they are the dominant holders of reserves. And whilst the share of gold in advanced economies reached 34% at the end of 2025, or fairly close to the 40% level, it was only 16% in emerging markets. If the dominant trends of central bank purchases and USD reserve sales are taking place in emerging markets, then there could still be a long way to go: from 16% to 40%.

There is a lot of heterogeneity across EM in gold's share in reserves. While EM central banks as a whole held 16% of reserves in gold (end-2025), this masks large variation. The average has a downward bias driven by the largest reserves holder - China: PBOC holds only 9% of reserves in gold. Clearly, the scope for increase driven by China is huge. Kazakhstan and Turkiye had over 60% of their reserves in gold, Russia and Egypt near 40%, Poland and Hungary had reached nearly 30%, while traditional US allies like South Korea and UAE had under 5% in gold.

Academic literature explains this heterogeneity through both an economic and geopolitical lens. Arslanalp, Eichengreen and Simpson-Bell (2025) argue that "central banks operating floating exchange rates hold more gold, consistent with the presumption that they have less need to use their reserves in foreign exchange market intervention." Indeed, gold holdings are less effective in helping central banks defend currencies against large scale capital flows. Thus, an increasing share of gold may reflect less concern amongst EM central banks about sudden stops or withdrawals of capital, especially with foreign ownership at lower levels than in the past. More interestingly, they find that “geopolitical alignment with the United States, proxied by the existence of a defence pact, increases dollar reserves. An interpretation is that governments grateful for US military presence encourage their central banks to hold dollars as a show of good faith.”

We also find that EM countries with closer defence ties to the Western bloc hold less gold in reserves, while EM countries with closer ties to China and Russia hold more gold. We draw on an analytical metric first used in our Global South framework to measure military alignment. We look at SIPRI data on arms imports for all emerging market countries over the last 10 years and calculate the proportion of arms imports from the "Eastern bloc", which we define as including China and Russia, versus the "Western bloc" which includes the US, Israel, Europe, and South Korea. We split EM countries into two groups: those that import more than a third of arms from the "Eastern bloc", and those that have limited defence integration with China and Russia. As Figure 20 illustrates, EM countries in the former group have double the share of gold in reserves than the latter group.

The implication of this analysis is that should more countries diversify defence dependence away from the US, this would be consistent with a reduced share of USD and a greater share of gold in reserves. The US has actively pressured major allies like NATO, South Korea and Japan to take on more ownership for their defence. And we have written about how the US-Iran conflict has challenged the US security umbrella over the Gulf and thereby support for the petrodollar and dollar savings. And while the ultimate geopolitical equilibrium remains to be seen, we think it could lead to some diversification of Gulf ties away from the US, and an acceleration in the localization of defence capabilities.

What might this mean for gold prices?

We simulate a range of different outcomes for gold prices depending on the level of FX reserves EM central banks end up with, and the share of gold in reserves they target.

• For total FX reserves, we consider four potential scenarios: a steady state for EM FX reserves of USD8tn (similar to current levels); and then three alternatives: a drastic decline in EM FX reserves to USD2.5tn, a decline to USD5tn, or an increase in EM FX reserves to USD10tn.

• For the share of gold in reserves, we look at a range of different shares rising from 15% to 40%. As discussed earlier, a 40% gold share could be a reasonable target for a "return to history" scenario, while 15-20% is where EM central banks are as a whole today.

• We use our earlier heuristic that every 1mn troy oz of purchases (sales) drives a 1% increase (decrease) in the gold price for our analysis. Our simulation is therefore dynamic, as we assume gold purchases by central banks influence the gold share through their impact on the prices as well. The rise in gold's share captures the blended impact of both prices and volumes.

The table in Figure 21 shares our simulation results. Prices shaded in green are above current gold prices (at the time of writing), while prices shaded in red are below. The numbers are not intended to be forecasts (found here), but to illustrate the range of potential price impacts from different combinations of EM central bank behaviour.

As intuition would suggest, if EM central banks are targeting a rising share of gold in a steady or growing FX reserves environment, this would be the most bullish outcome for gold. But even in an environment where EM FX reserves decline to USD5tn, if central banks target an increase of gold's share to 40%, this could still be consistent with gold prices rising to near $8000 over the next five years. We walk through the calculation in the simulation to illustrate. At USD5tn in FX reserves, gold would need to be worth USD3.3tn for gold to be a 40% share. Getting to USD3.3tn in gold would be a function of central banks buying more gold, and that buying driving up prices. Assuming every 1mn troy oz of purchases drives up gold prices by 1%, if EM central banks build gold holdings to 417mn oz, or an additional 52mn oz, this would drive up prices to around $7977, which would put total gold valuations at around USD3.3tn. At the current pace of gold purchases of roughly 10mn troy oz per year by central banks (based on IMF central bank only data series), this would be consistent with five more years of gold buying. In other words, EM central banks could push gold prices to $8000 over the next five years even in a declining FX reserves environment.

In the extreme case of EM FX reserves falling to USD2.5tn, the current volume of gold held by EM central banks at current prices (USD1.7tn), would already give gold a 40% share. There is thus no upside to gold projected in the first row of the table.

This simulation also helps us understand the price action of gold in March 2026 during the Iran war. IMF reserves data for the month of March showed overall EM central banks sold gold, led by Turkiye. These gold sales are likely a function of the fact that Turkiye has a high share of gold in reserves at over 60% which were therefore leveraged for liquidity. As our colleagues note, net FX intervention by the CBT reached USD23bn in the last two weeks of March, and the CBT mobilised around USD 20bn worth of gold — USD 11.1bn via gold-FX swaps and USD 8.2bn through outright gold sales. While acute, this is not likely to be representative of a broader trend in EM. Countries from Poland to Kazakhstan were still buying gold in March according to IMF data, and China's PBOC data also shows buying at the fastest pace in a year. Most EM countries have gold shares at far lower levels than Turkiye with significant scope to raise them.

If more of the rise of gold's share for EM central banks is achieved through the drawdown of FX reserves, this will be less bullish for gold. If, however, EM FX reserves are stable or fall more gradually, and central banks engage in active buying of gold to raise their gold shares, this will be more bullish for gold.

What does this suggest about the monetary order to come?

As this paper has discussed, central banks in emerging markets have been actively adding to their gold holdings. The rationale for this is mostly seen as being about diversifying official savings into a physical long-lived asset, that can be held beyond the reach of sanctions, and which is likely to hold value better than fiat currencies amidst greater fiscal and inflation risks.

But it is worth considering whether the build up in physical gold in emerging markets might be a precursor to a potential return of gold as an anchor for an alternative future monetary system. Since the collapse of the Bretton Woods, gold has not had a formal role in international monetary architecture. But history has long alternated between periods of fiat and physical-backed money. It would be consistent with - not counter to - history, to expect gold to return at some stage.

The US backed the dollar with gold when it created the post-war monetary architecture of Bretton Woods. It would thus be intuitive to expect any effort by other countries looking to create a bigger role for their currencies in payments and savings to also turn to gold. Gold has been part of monetary orders for over 2500 years and is not anyone's liability. And while production does expand supply - with above-ground gold stocks growing at around 2% a year this century - this is less than the growth in most countries' fiscal deficits. For countries in the Global South, where economic regimes, rule of law, and capital account openness, may be less well understood by global corporates and investors, backing payment currencies with a share of physical gold could be an important trust-building mechanism.

While far from formalized as policy, there are pockets of discussion around gold playing a role in backing a future BRICS currency. A paper from OMFIF, an independent think tank for central banking, economic policy and public investment, noted that the “BRICS are exploring the creation of a common currency that would be pegged partly to gold and partly to a basket of their own currencies.” They noted that "by tokenizing gold reserves, each digital unit would be backed by tangible assets stored in secure vaults, with regular audits ensuring accountability.” They note that a "gold linked alternative BRICS payment system" could again give gold a "distinct role in payments." Media reports in late 2025 indeed noted the pilot release of a BRICS Unit backed 40% by physical gold and 60% by an equal split of CNY, RUB, INR, ZAR, and BRL fiat currencies. We would stress that the "Unit" does not appear to be formal policy by the BRICS and thus should be considered more a thought experiment at this stage. But the momentum for creating alternative payment rails that facilitate local currency payments in the Global South are well underway. For instance, Project mBridge has already reached minimum viability for payments and involves central banks in China, Saudi Arabia, UAE, Hong Kong, and Thailand settling cross-border trade via wholesale CBDCs over the blockchain.

The economic clout of China and the Global South in PPP-adjusted GDP already exceeds 50% of the world today, and a majority of global trade flow growth is happening down these corridors. Payment innovations in this part of the world should thus be paid heed. We have written in great detail (see here) how competition around payments is heating up and how this is deeply linked with reserve currency status through the linkages between invoicing and savings. The US has opted for stablecoins as its solution to ensuring dollar dominance, namely in the Global South where traditional USD payments mechanisms were at risk. We note that while US stablecoins would be backed by US T-bills, a BRICS currency of the future could well be backed in part by physical gold.

In sum, while EM central bank diversification into gold likely has much to do with preserving the value and accessibility of their foreign savings in a changing geopolitical climate, it may also - in the long-run - play a role in anchoring a monetary order that builds independence from the dollar. There is of course a very long way to go. EM central banks as a whole still only hold half the physical gold of advanced economy central banks. But there is a world where gold returns to the centre of a future monetary system with different leaders.

To conclude, we find it notable that the value of above-ground gold exceeded the total value of marketable US Treasury debt last year for the first time in 40 years (Figure 22). In other words, gold is now a bigger asset class than the world's main safe asset.

The return of history is here.

Professional subscribers can read the full Deutsche Bank note: "The return of history: gold, the dollar, and the monetary future" here at our new Marketdesk.ai portal

Tyler Durden Sun, 05/10/2026 - 06:33

Avert your eyes! My Sunday morning look at incompetency, corruption and policy failures:

• Why Almost Everyone Loses—Except a Few Sharks—on Prediction Markets: A WSJ analysis shows a small number of accounts on Polymarket and Kalshi—often pros using data-driven algorithmic trading—take home most of the winnings. Polymarket and Kalshi run on the same dynamic as every other market — informed pros take retail money. The only surprise is how many retail bettors keep showing up. (Wall Street Journal)

• What $25 Billion Spent on the War in Iran Really Means: $25 billion is similar to: The annual budget of NASA. Spending on military aid to Israel after Oct. 7. Spending by U.S.A.I.D. before it was disbanded. The cost to expand Obamacare subsidies for one year. These are all comparisons to other aspects of the U.S. federal budget. An Upshot interactive translating the bill into the things we said we couldn’t afford. Opportunity-cost journalism at its best. (New York Times) see also The real cost of the Iran War: $72 billion for the first 60 days: Popular Information crunches the numbers. The official accounting is at least $47 billion too low. (Popular Information)

• This Summer, the American Water Crisis Becomes Real: From the West to the Mississippi, the water-infrastructure stories are converging. The summer of 2026 may be the year the abstract becomes the ordinary. Concerns over water access are poised to consume summer in the US, as crises in Corpus Christi and across the Colorado River threaten to boil over. (Wired)

• Meet Clout-as-a-Service: Where weaponised FOMO meets digital gaslighting: What happens when “experiences” evolve from physical presence to virtual tags. On the influencer-rental market and the manufactured-virality economy. The internet is mostly performance now; the prices are finally legible. (Girl Online)

• In Wine Country, Sales Are Down and Fraud Is Rampant: Ian Frisch on a luxury market in retreat, and the fakes that always flourish when the real stuff stops moving. Fraud loves a soft tape. The industry’s murky supply chain has long attracted scammers and con artists. In the words of one expert, “Wine and fraud go hand in hand.” (DealBook)

• The Convenient Narrative Letting Insurers Off the Hook: Blaming hospitals isn’t wrong. But it’s incomplete—and it’s exactly the story insurers want told. On the framing tricks that keep health insurers blameless in the public discourse. Worth reading before your next employer-benefits meeting. Blaming hospitals isn’t wrong. But it’s incomplete—and it’s exactly the story insurers want told. (Health Care Un-Covered)

• Babies Are Bleeding to Death as Parents Reject a Vitamin Shot Given at Birth: An Essential Shot, Vitamin K, which help the blood to clot, are one of three key interventions for newborns, along with an antibiotic eye ointment and the hepatitis B vaccine. The government doesn’t track vitamin K rejections, but hospitals have seen a rise in parents opting out of the shots for their newborns, often driven by unfounded fears. Hundreds of children die each year from spontaneous bleeding in the brain, a common result of vitamin K deficiency, suggesting that many related deaths go unreported. The vitamin-K refusal trend produces preventable infant deaths. (ProPublica)

• The media blackout of Jared Kushner’s historic, ongoing corruption scandal: As Trump’s son-in-law returns to Pakistan for more talks with Iran, major news outlets are largely ignoring an egregious conflict of interest. Judd Legum documents how the press has failed to cover Kushner’s ongoing foreign-payments scandal. (Popular Information) see also How the Trump family’s business deals could open the door for future presidents to profit from office: The problem of conflicts of interest goes back a decade to when Trump first ran for office, but some government ethics experts and historians argue it’s more pressing than ever as conflicts pile up in his second term that they consider unprecedented, blatant and dangerous to democracy. The AP’s Bernard Condon on the precedent being set in real time. The norm erosion outlasts the administration that caused it. (PBS)

• The Corporate Thriller Lied to Us: On the genre’s long arc from ‘corporations are scary’ to ‘corporations are simply the world.’ A useful frame for what we expect storytelling to do. Criterion Channel is hosting a retrospective on Hollywood’s “corporate thrillers” from the 1980s through the early 2000s. If anything, their message about the capitalist rot in America’s institutions looks far too tame for how the last couple of decades turned out. (Jacobin)

• Adam Silver Goes to War: The mild-mannered NBA commissioner has overseen a time of peace and prosperity for his league. Until now. The NBA commissioner is taking on tanking, gambling controversies, and a bloated playoff format. Now, with the 2026 playoffs under way—the capstone of the most turbulent regular season in modern NBA history—Silver for the first time faces real trouble. The quality of the product has diminished. Narratives surrounding the league are prevailingly negative. Things once taken for granted—commercial satisfaction, cultural prestige, national relevance—no longer seem guaranteed. Peacetime is a thing of the past; for the foreseeable future, the commissioner will be at war—with fans, with media critics, with players and coaches, with the game itself. I came to Nashville wanting to know: Does Adam Silver have the stomach for this fight? Tough room. (The Atlantic)

Video of the day: Stronger Than Steel. Lighter Than Plastic. Why Aren’t We Using It?

Be sure to check out our Master’s in Business interview this weekend with Howard Lindzon, known as “The Larry David of Finance.” He is General Partner at the seed fund, Social Leverage, he was one of the first seed investors in Robinhood, which IPOd at $30B in 2021, eToro, Manscaped, and Beehiiv. Previously, he founded Wallstrip, a daily online video show acquired by CBS (2007). He also co-founded Stocktwits, which pioneered the “cashtag.” Recognized by Institutional Investor as a “Super Angel;” his podcast is Panic with Friends.

 

Trump used the presidency to promote family businesses 110 times in 16 months

Source: Popular Information

 

 

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How Governments, Corporations, & Technocratic Systems Are Quietly Redefining Ownership In The 21st Century

Authored by Milan Adams via PreppGroup,

There are periods in history when societies begin to discover that the liberties they believed to be permanent were, in reality, conditional arrangements tolerated only while they remained politically convenient. Across the Western world, governments are quietly expanding the legal and administrative mechanisms through which private land can be reclassified, restricted, absorbed, or transferred in the name of infrastructure, sustainability, industrial security, climate adaptation, and economic modernization. Entire farming regions are now being surveyed for carbon pipelines. Rural communities are facing unprecedented redevelopment pressure linked to energy transitions and semiconductor expansion. Financial institutions are purchasing strategic agricultural land at historic levels while policymakers openly discuss the restructuring of urban life around centralized digital systems. Officially, these transformations are described as progress. Unofficially, an increasing number of citizens have begun to suspect that the modern definition of ownership itself is being rewritten in real time.

The New Architecture of Property Seizure

The modern citizen has been conditioned to believe that private property represents one of the sacred foundations of liberal democracy. Constitutions defend it, political campaigns celebrate it, and economists routinely describe it as the engine of prosperity and social stability. Yet beneath the ceremonial rhetoric lies a more fragile reality — one in which ownership increasingly resembles a conditional administrative privilege rather than an untouchable natural right. This contradiction becomes impossible to ignore when examining the doctrine of eminent domain, the extraordinary legal authority through which governments may confiscate private property without the owner’s consent.

Supporters of eminent domain insist that such authority is indispensable for the functioning of modern civilization. Roads must be built, railways expanded, energy corridors connected, airports enlarged, water systems modernized, and industrial facilities constructed. In many cases, governments provide financial compensation to displaced owners, presenting the process as a rational exchange carried out for the collective benefit of society. Yet the deeper philosophical problem has never truly revolved around compensation. The more disturbing issue is whether property can genuinely be called “private” if the state ultimately reserves the authority to seize it whenever officials determine that a superior public or economic purpose exists.

Centuries ago, political philosopher John Locke articulated this contradiction with remarkable clarity in his Second Treatise of Civil Government, writing: “For I have truly no Property in that, which another can by right take from me, when he pleases against my Consent.” Locke understood that property rights and liberty are inseparable mechanisms. If ownership exists only so long as political authorities permit it, then freedom itself becomes conditional. A citizen whose property may be overridden by state power is not fully sovereign over the fruits of his labor, his land, or his future.

This philosophical tension has become increasingly visible throughout 2025 and 2026 as eminent domain controversies intensify across the United States and parts of Europe. The issue is no longer confined to highways and traditional public infrastructure. Governments are now invoking compulsory acquisition powers for semiconductor manufacturing facilities, renewable energy grids, carbon capture pipelines, smart-city redevelopment programs, affordable housing mandates, climate resilience projects, and strategic industrial corridors tied to geopolitical competition with China. What once appeared to be an exceptional legal mechanism reserved for rare circumstances is gradually evolving into a normalized instrument of economic planning.

The transformation accelerated dramatically after the controversial Supreme Court decision in Kelo v. City of New London in 2005, which expanded the interpretation of “public use” to include broader economic development objectives. The ruling effectively established that governments could seize private property and transfer it to private developers if officials believed the redevelopment project might generate greater economic productivity or increased tax revenue. Although the decision triggered national outrage, the long-term implications proved even more consequential than many observers initially realized. The ruling fundamentally altered the psychological relationship between citizens and ownership itself. Property was no longer protected solely because it belonged to an individual; it could now be reclassified according to projected economic utility.

Ironically, many of the promises surrounding the original New London redevelopment project collapsed. Large sections of the confiscated land remained undeveloped for years, becoming symbolic monuments to speculative planning failures. Yet rather than causing governments to retreat from expansive eminent domain practices, the ruling instead normalized a new political vocabulary capable of reframing coercive land acquisition in increasingly sophisticated ways. “Urban renewal” evolved into “smart growth.” “Industrial expansion” transformed into “strategic economic resilience.” “Environmental necessity” became “climate adaptation infrastructure.” The language softened while the underlying mechanism remained fundamentally unchanged.

One of the most explosive contemporary examples emerged from the construction of carbon dioxide pipelines across the American Midwest. These projects, promoted as essential components of future climate infrastructure, triggered fierce resistance from farmers and rural landowners who argued that their property rights were being subordinated to corporate and political agendas disguised as environmental policy. Summit Carbon Solutions initiated hundreds of legal actions connected to eminent domain disputes as officials and developers attempted to secure continuous pipeline corridors through privately owned agricultural land. For many rural communities, the issue transcended compensation entirely. Families feared not only environmental consequences involving groundwater and soil stability, but also the broader precedent being established through these forced acquisitions.

The backlash became politically severe enough that South Dakota eventually banned the use of eminent domain for carbon dioxide pipelines in 2025. The significance of this moment extended beyond the pipeline debate itself because it revealed a rapidly expanding distrust toward centralized planning institutions. Citizens increasingly sensed that environmental objectives were being used to justify extraordinary powers capable of overriding local autonomy and long-standing ownership traditions. While governments publicly framed such projects as indispensable for decarbonization and sustainable development, critics argued that the legal infrastructure being constructed around climate policy could eventually extend far beyond pipelines alone.

Many analysts dismiss these fears as exaggerated or conspiratorial. Nevertheless, the broader anxieties persist because governments and international organizations are already openly discussing policies involving managed retreat zones, climate adaptation corridors, AI-assisted urban planning systems, and expanded environmental land-use restrictions. Individually, each proposal appears administratively rational. Collectively, however, they begin to resemble the early architecture of a society in which ownership is increasingly subordinate to centralized optimization models designed around sustainability metrics, industrial planning objectives, and algorithmic governance systems.

The semiconductor industry has provided another revealing example of how geopolitical competition is reshaping the balance between state authority and individual property rights. In New York, a massive semiconductor manufacturing expansion connected to a multibillion-dollar industrial initiative displaced elderly homeowners whose land had been targeted for redevelopment. Officials justified the project as strategically indispensable for national security and technological independence, particularly amid intensifying tensions between the United States and China over advanced chip production. Within such frameworks, resistance from individual landowners becomes politically inconvenient because industrial competitiveness itself is treated as a permanent national emergency requiring extraordinary intervention.

This represents a profound transformation in the logic of democratic governance. Historically, governments expanded coercive authority during visible wars or catastrophic crises. Today, however, economic competition itself increasingly functions as a perpetual justification for exceptional state power. Artificial intelligence infrastructure requires enormous data centers. Data centers require energy corridors and water access. Energy corridors require land consolidation. Strategic manufacturing requires zoning flexibility and rapid acquisition mechanisms. Under these conditions, private property gradually becomes an obstacle to national planning objectives rather than a protected sphere of individual autonomy.

The emotional dimension of this conflict becomes especially visible when examining multigenerational farmland disputes. Across several states, families cultivating the same land for over a century have found themselves confronting eminent domain proceedings connected to rail expansions, renewable energy projects, housing mandates, and transportation corridors. These confrontations reveal a deeper philosophical fracture embedded within modern governance systems. Technocratic institutions increasingly evaluate land through the lens of utility maximization, calculating value according to projected tax revenue, housing density targets, industrial productivity, environmental compliance metrics, or strategic infrastructure potential. Within such frameworks, land ceases to represent permanence, inheritance, or identity and instead becomes a movable economic variable inside a larger administrative equation.

Families, however, tend to perceive property through an entirely different moral architecture. A farm cultivated across generations is not merely acreage measured in market value, just as a family home cannot be reduced to a line inside a municipal redevelopment blueprint. These places often embody continuity, memory, sacrifice, and personal sovereignty in ways financial compensation can never adequately replace. This growing collision between technocratic optimization and emotional permanence is rapidly becoming one of the defining political tensions of the twenty-first century.

What makes the situation particularly volatile is the emergence of a broader economic philosophy that increasingly treats ownership itself as inefficient when compared to centralized management systems. A growing number of political theorists and economic critics have begun describing this transformation as a form of neo-feudalism — not a literal return to medieval structures, but rather the gradual replacement of independent ownership with conditional access controlled by interconnected institutional authorities. Under such systems, citizens may still possess legal titles, mortgages, or deeds, yet ultimate control over property becomes layered beneath zoning commissions, environmental agencies, taxation systems, redevelopment authorities, financial institutions, insurance corporations, and emergency regulatory powers capable of overriding individual autonomy whenever larger policy objectives demand intervention.

The implications of this shift become even more unsettling when viewed alongside the accelerating digitization of governance. Across the Western world, governments and international organizations have proposed integrating land registries with digital identity systems, smart contracts, environmental compliance monitoring, and AI-assisted administrative oversight. Publicly, these innovations are framed as modernization efforts designed to reduce fraud, improve efficiency, and streamline urban planning. Critics, however, fear that such systems could eventually create the infrastructure for unprecedented levels of centralized influence over property rights, particularly if future economic or climate emergencies are used to justify extraordinary intervention measures.

While many of the more apocalyptic theories surrounding these developments remain speculative, the underlying anxieties persist because citizens can already observe partial versions of these dynamics emerging in real time through environmental zoning restrictions, mass institutional acquisition of farmland, algorithmic insurance risk assessments, and increasingly aggressive redevelopment policies carried out under the language of sustainability and economic necessity. Even in the absence of a coordinated conspiracy, the cumulative effect can still produce the same practical outcome: the gradual erosion of truly independent ownership.

Regions Increasingly Targeted by Strategic Redevelopment and Land Acquisition Pressures

• Midwest agricultural corridors in Iowa, Nebraska, and South Dakota connected to carbon pipeline expansion projects and renewable infrastructure routes.

• Semiconductor development zones in New York, Arizona, and Texas where strategic manufacturing initiatives are accelerating property acquisition and rezoning procedures.

• Coastal regions in California, Florida, and parts of the Gulf Coast increasingly affected by climate adaptation planning, insurance withdrawal crises, and managed retreat discussions.

• Rural farmland sectors across Illinois, Indiana, and Kansas experiencing rapid institutional investment linked to future food security and energy transition strategies.

• Urban redevelopment districts in cities such as Atlanta, Chicago, and Philadelphia where “blight” designations and smart-city modernization programs have intensified displacement concerns.

• Transportation and logistics corridors surrounding major inland freight hubs, particularly near Dallas-Fort Worth, Memphis, and Kansas City, where industrial optimization projects continue expanding aggressively.

• Water-resource regions in the American Southwest where future scarcity projections are beginning to influence zoning policy, agricultural rights, and long-term land valuation models.

As these pressures intensify, the political meaning of ownership itself may continue evolving in ways previous generations would have considered unthinkable. The central issue is no longer limited to whether governments possess the authority to seize property under extraordinary circumstances. The more consequential question involves how frequently those circumstances are now being redefined and expanded to accommodate increasingly ambitious economic, technological, environmental, and geopolitical objectives.

The modern world increasingly celebrates efficiency as the supreme organizing principle of civilization. Governments pursue efficient transportation systems, efficient energy transitions, efficient housing density models, efficient industrial logistics, and efficient urban management structures powered by predictive algorithms and centralized data analysis. Yet liberty has never been efficient. Genuine freedom often depends upon the existence of friction — the ability of individuals to refuse, resist, delay, negotiate, or preserve spaces outside the reach of centralized planning systems.

The farmer who refuses to sell ancestral land, the homeowner resisting redevelopment pressure, the rancher opposing compulsory easements, and the family preserving generational property despite extraordinary financial offers all represent forms of resistance against the growing belief that economic optimization should supersede personal sovereignty. From a purely technocratic perspective, such resistance appears irrational because it slows development and complicates large-scale planning objectives. From a liberty-centered perspective, however, these acts preserve the final boundary separating ownership from conditional occupancy.

In this sense, the debate surrounding eminent domain extends far beyond legal procedure or infrastructure policy. It touches the deeper philosophical foundation of democratic civilization itself. A society in which property exists only until authorities identify a superior administrative use gradually transforms ownership into permission rather than right. Once that transition occurs, liberty itself begins losing the permanence required for true independence. The danger may not emerge suddenly through overt authoritarianism, but incrementally through layers of regulation, emergency policy, technological integration, and economic planning that slowly redefine the relationship between citizens and the spaces they once believed belonged entirely to them.

The long-term consequences of this transformation may become even more profound as artificial intelligence, predictive governance systems, and centralized economic planning begin converging into a single administrative framework. During previous centuries, governments lacked the technological capacity to monitor property usage, energy consumption, environmental compliance, financial behavior, demographic movement, and land productivity in real time. That limitation functioned as an invisible restraint on centralized authority. Modern states, however, are rapidly acquiring precisely these capabilities through satellite surveillance, digital registries, biometric identification systems, AI-assisted analytics, and integrated financial technologies capable of processing enormous volumes of behavioral data simultaneously.

This technological convergence has introduced a new political phenomenon that many citizens still underestimate: the replacement of reactive governance with anticipatory governance. Traditional democratic systems generally responded to visible crises after they emerged. Contemporary institutions increasingly attempt to predict and preempt future economic, environmental, or infrastructural disruptions before they fully materialize. In theory, such predictive governance promises efficiency and stability. In practice, it creates conditions under which governments may justify extraordinary interventions based not on present realities, but on statistical projections, algorithmic forecasting, and speculative risk assessments.

This distinction is critical because speculative governance dramatically expands the potential scope of eminent domain and administrative land control. A government no longer needs to demonstrate that land is immediately necessary for an existing public project. It may instead argue that future climate migration patterns, projected energy shortages, demographic shifts, industrial competition, water scarcity, or strategic economic vulnerabilities justify preemptive territorial restructuring decades in advance. Under such conditions, ownership becomes vulnerable not only to current policy objectives but also to predictive models generated by institutions whose assumptions may themselves remain politically contested.

The implications become especially significant when examining the emerging relationship between climate policy and territorial governance. Across North America and Europe, policymakers increasingly discuss the concept of “climate resilience corridors,” managed retreat zones, adaptive infrastructure networks, and carbon-neutral urban restructuring. Publicly, these proposals are presented as rational responses to environmental instability. Yet critics argue that the language surrounding climate adaptation is gradually normalizing the idea that governments may eventually redesign entire regions according to sustainability criteria determined by centralized planning authorities rather than local communities.

Several environmental planning documents have already explored scenarios involving the relocation of populations away from vulnerable coastal areas, the consolidation of agricultural production into designated efficiency zones, and the expansion of urban density models designed to reduce transportation emissions. None of these proposals necessarily constitute authoritarian conspiracies in themselves. Nevertheless, they reveal an ideological trajectory in which land is increasingly treated as a strategic administrative asset subject to optimization rather than as a decentralized foundation of individual autonomy.

This broader transformation also intersects with the accelerating financialization of property markets. Over the past decade, institutional investors, multinational asset management firms, pension funds, and corporate real-estate conglomerates have acquired unprecedented quantities of residential housing, farmland, and strategic infrastructure-linked territory throughout the Western world. In many regions, ordinary citizens now compete against entities possessing virtually unlimited liquidity and long-term strategic acquisition models. Critics increasingly fear that this trend is creating a bifurcated society in which large institutions accumulate permanent ownership while ordinary populations transition toward perpetual rental dependency.

The psychological effects of this shift are already visible among younger generations. Homeownership, once considered a realistic milestone of adulthood, has become unattainable for millions due to escalating property prices, speculative investment patterns, and declining purchasing power. As ownership recedes, dependence on institutional landlords, subscription-based living models, and centralized service ecosystems intensifies. What previous generations viewed as temporary economic hardship may actually represent the early stages of a more permanent structural transition away from widespread independent ownership.

Some economic futurists openly defend this transition, arguing that access-based economies are more flexible, sustainable, and technologically compatible with modern urban life. According to this perspective, citizens no longer require permanent ownership because digital platforms can provide transportation, housing, entertainment, labor, and consumption through integrated subscription ecosystems. Yet critics counter that access and ownership are fundamentally different forms of social power. Ownership creates autonomy, while access remains conditional upon continued institutional approval and financial compliance. A citizen who owns nothing substantial becomes increasingly vulnerable to economic disruption, policy changes, financial censorship, algorithmic exclusion, or shifting regulatory standards.

This concern has intensified dramatically following the expansion of digital financial surveillance systems and programmable payment technologies. Several governments and central banks have explored the future implementation of central bank digital currencies capable of integrating transactions into highly centralized financial architectures. Officially, such systems are promoted as tools for efficiency, anti-fraud enforcement, and economic modernization. However, skeptics fear that combining centralized financial control with digitized property systems could eventually create unprecedented leverage over individual autonomy. If property rights, taxation, energy consumption, environmental compliance, banking access, and digital identity become interconnected within unified administrative systems, then ownership itself may become increasingly conditional upon behavioral conformity.

While some of the more apocalyptic narratives surrounding these developments undoubtedly exaggerate the immediacy of such scenarios, the broader structural trajectory remains difficult to ignore. Governments across the world are steadily increasing their reliance on integrated digital oversight mechanisms. Corporations are accumulating strategic physical assets at extraordinary rates. Artificial intelligence systems are becoming embedded within regulatory decision-making processes. Climate policy is expanding into territorial planning. Economic competition is increasingly framed as a permanent emergency requiring centralized coordination. Each development, considered individually, appears manageable. Collectively, however, they form a landscape in which traditional concepts of private ownership may become progressively diluted over time.

The cultural consequences of this evolution could prove as significant as the legal and economic consequences. Property ownership historically functioned not merely as a financial asset, but as a psychological foundation for citizenship itself. Individuals who possessed land, homes, farms, or independent businesses generally maintained stronger incentives to participate in civic life, resist political overreach, and preserve local community structures. Ownership cultivated permanence, and permanence fostered responsibility toward future generations.

By contrast, highly transient populations dependent upon rental systems and centralized infrastructure often develop weaker attachments to local institutions and reduced capacity for long-term independence. A society dominated by temporary access arrangements rather than enduring ownership may gradually become more politically passive, economically fragile, and administratively manageable. In such environments, governments and corporations acquire increasing influence not necessarily through overt coercion, but through structural dependency.

This dynamic helps explain why eminent domain debates provoke such intense emotional reactions even among citizens who never expect their own property to be seized directly. At an instinctive level, many people recognize that the issue transcends infrastructure policy entirely. The struggle concerns whether there remains any sphere of life genuinely insulated from centralized authority. If property can ultimately be overridden whenever sufficient political, economic, environmental, or technological justification emerges, then ownership itself risks becoming symbolic rather than substantive.

The modern political class frequently frames these tensions as conflicts between progress and obstruction. Citizens resisting redevelopment projects are often portrayed as impediments to modernization, sustainability, affordability, or economic growth. Yet this framing deliberately ignores the philosophical role private property has historically played within free societies. Property rights were never designed solely to maximize economic efficiency. They existed partly to limit concentrations of power by ensuring that individuals retained independent zones of autonomy resistant to political centralization.

The erosion of those protections rarely occurs through sudden authoritarian decrees. More often, it unfolds gradually through administrative normalization. Each new exception appears temporary. Each emergency justification appears rational. Each expansion of authority appears narrowly tailored to a specific crisis. Over time, however, the cumulative effect can fundamentally redefine the relationship between citizens and the state without any single revolutionary moment ever occurring.

History repeatedly demonstrates that societies often fail to recognize transformative shifts while they are happening. Citizens adapt incrementally to changes that previous generations would have considered extraordinary. Policies initially introduced during emergencies become permanent. Temporary surveillance becomes normalized infrastructure. Exceptional powers evolve into ordinary administrative procedures. By the time the broader transformation becomes fully visible, institutional momentum may already be deeply entrenched.

This is precisely why contemporary property-rights debates deserve far greater scrutiny than they currently receive. The issue is not simply whether governments occasionally require land for legitimate public projects. Every complex civilization inevitably faces situations involving infrastructure development and competing territorial interests. The deeper concern involves the accelerating expansion of the philosophical categories capable of justifying compulsory acquisition and centralized territorial management.

Today, governments invoke eminent domain and land restrictions for highways, carbon pipelines, renewable energy corridors, semiconductor facilities, affordable housing mandates, environmental adaptation projects, logistics hubs, and industrial modernization zones. Tomorrow, additional categories may emerge involving AI infrastructure, water rationing systems, food-security corridors, demographic redistribution planning, or automated transportation networks. As technological complexity increases, the temptation for centralized optimization will likely intensify alongside it.

Yet civilizations ultimately face a profound choice between efficiency and autonomy. A perfectly optimized society may achieve extraordinary administrative coordination while simultaneously eroding the independent spaces necessary for genuine liberty. Conversely, a society committed to preserving strong property rights inevitably accepts a degree of inefficiency because decentralized ownership creates friction against centralized planning. That friction is not a flaw within free societies; it is often their primary safeguard against excessive concentration of power.

The future of property rights may therefore determine far more than real-estate law or zoning policy. It may shape the very architecture of citizenship in the twenty-first century. Whether individuals remain sovereign owners with meaningful independence or gradually transition into highly managed participants within centralized administrative ecosystems could become one of the defining political questions of the coming era.

And perhaps that is the most unsettling aspect of the entire debate: the possibility that the transformation is not arriving through dramatic revolution, military force, or visible dictatorship, but through a slow and highly sophisticated convergence of technology, economic planning, environmental policy, financial centralization, and administrative normalization that redefines ownership so gradually that many citizens may not fully recognize the implications until the older understanding of liberty has already faded into history.

Tyler Durden Sat, 05/09/2026 - 23:20

Chinese EVs Absent From U.S. Roads, But Parts Under The Hood Are Alarming

For good reason, U.S. policymakers have resisted opening the domestic auto market to a flood of cheap, gasoline-powered Chinese cars and EVs. Such a move would crush Detroit into even more misery. It would accelerate the hollowing out of the nation's industrial base (something Europe willingly did), further degrade suppliers, and weaken the country's ability to convert truck production lines to tank production in wartime.

However, while Chinese-made cars remain absent from U.S. highways, there has been a flood of Chinese auto parts, from airbags to transmissions to starters to steering systems and many other components, according to a new Wall Street Journal report citing data from consulting firm AlixPartners.

According to AlixPartners data, Chinese companies hold ownership stakes in about 10,000 suppliers nationwide. The exposure is an eye-opener for lawmakers, as the urgency to decouple critical supply chains from China remains a national security priority under the Trump administration.

"They're [China] deeply integrated into the industry," Michael Dunne, CEO of automotive consulting firm Dunne Insights, told the outlet.

Examples of this alarming deep integration include Ford's Mustang GT, which uses a six-speed manual transmission from China; Toyota's Prius plug-in hybrid, with about 15% of parts sourced from China; and GM's Chevrolet Trax, Blazer EV, and Equinox EV, which contain approximately 20% Chinese parts.

Several automakers have been dialing back their parts exposure to China in recent years. Tesla has required suppliers to remove China-made components from U.S.-built vehicles, while GM says China now accounts for less than 3% of its direct material spending for U.S.-made cars. Still, government data show that at least 40 models for sale in the U.S. have alarmingly high levels of Chinese components.

What's increasingly clear is that over the last 15 years, Beijing has been taking aggressive market share in the global auto market to become a dominant player. AlixPartners data show that in 2012, only one Chinese company ranked among the world's top 100 auto suppliers. Now that figure is expected to reach 22 by 2030.

Lawmakers have been briefed about ways to eliminate Chinese auto parts from the U.S. market, which has only put pressure on the domestic supplier network.

In late April, more than 50 House Republicans, led by Rep. Mike Kelly (R., Pa.), penned a letter to Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick, and U.S. Trade Representative Jamieson Greer, urging them to block Chinese automotive and battery companies from manufacturing in the U.S.

Juergen Simon, a partner at AlixPartners, told the outlet, "This shows the incredible speed at which the competitive environment has changed." He noted that Chinese suppliers were once avoided due to concerns about quality and performance, but that is no longer the case.

The race to clean up decades of globalism that crushed America's industrial core is well underway with the Trump administration. It appears the move to rebuild the nation's auto supplier network and eliminate China from that ecosystem could be nearing.

Tyler Durden Sat, 05/09/2026 - 22:45

4 Key Points From New White House Counter-Terror Strategy

Authored by Ryan Morgan via The Epoch Times,

President Donald Trump’s administration rolled out its new counterterrorism strategy overview on May 6, articulating recent policy shifts and new pledges going forward.

The 16-page strategy guide seeks to articulate an “America First” approach to dealing with militants, extremists, and criminal enterprises.

“For the 25th Anniversary of the 9/11 terror attacks, America has returned to a common sense and reality-based Counterterrorism Strategy,” the document states.

“President Trump has [effected] a complete revision of how we defeat threats to America predicated on national sovereignty and civilizational confidence and the objective of destroying the groups who would kill Americans or hurt our interests as a free nation.”

Here are four key points in the new strategy rollout.

Violent Left-Wing Groups Fall Under Expanded Counterterror Scope

The new strategy document articulates a widened aperture for U.S. counterterrorism efforts.

“We face new categories and combinations of violent actors that make the established ways of doing counterterrorism insufficient or obsolete,” the document reads.

Although U.S. counterterror efforts have long focused on threats posed by radical Islamist groups, the new strategy document also lists “violent left-wing extremists” and “narcoterrorists and transnational gangs” among the top three major categories of terror groups.

The Trump administration has already taken steps to apply counterterrorism authorities to violent left-wing groups and ideological movements that oppose the American way of life as outlined in the founding documents.

In November 2025, the U.S. State Department designated four violent transnational left-wing groups as foreign terrorist organizations.

Trump previously issued an executive order declaring Antifa a domestic terrorist organization, although U.S. law currently provides no domestic equivalent to a foreign terrorist organization designation.

Antifa members gather to demonstrate following the announcement of the results of the first round of the presidential election, in Nantes, France, on April 23, 2017. Jean-Sebastien Evrard/AFP via Getty Images

“Our national [counterterrorism] activities will also prioritize the rapid identification and neutralization of violent secular political groups whose ideology is anti-American, radically pro-transgender, and anarchist,” the document states.

“We will use all the tools constitutionally available to us to map them at home, identify their membership, map their ties to international organizations like Antifa, and use law enforcement tools to cripple them operationally before they can maim or kill the innocent.”

The document, at one point, describes a so-called Red-Green alliance of deepening alignment between far-left and Islamist movements.

Focus Shifting to the Western Hemisphere

The move to list cartels and transnational gangs as a leading terror threat category aligns with a broader effort to shift the focus of U.S. counterterror operations to the Western Hemisphere.

“Our Strategy first prioritizes the neutralization of hemispheric terror threats by incapacitating cartel operations until these groups are incapable of bringing their drugs, their members, and their trafficked victims into the United States,” the document reads.

Since the start of Trump’s second term, the State Department has added 15 Latin American and Caribbean cartels and criminal gangs to its list of foreign terrorist organizations.

In September 2025, U.S. military forces began conducting lethal strikes on what officials said were confirmed drug trafficking boats operating in the Caribbean Sea, and later in the Eastern Pacific. Those lethal strikes have continued in the months since.

The U.S. Southern Command reported its most recent strike on a drug boat on May 5. Three people were killed in the strike.

Nicolás Maduro and his wife, Cilia Flores (rear), are escorted by federal agents after landing at a Manhattan helipad, as they make their way into an armored car en route to a federal courthouse in New York City on Jan. 5, 2026. XNY/Star Max/GC Images

U.S. forces also carried out a special operations raid on Venezuela on Jan. 3 to capture Venezuelan leader Nicolás Maduro and bring him to the United States to face criminal prosecution on charges related to drug trafficking and narco-terrorism.

The new strategy document explicitly lists countering leading Islamic extremist groups as its second-highest priority. The document said the top five Islamist groups are al-Qaeda, al-Qaeda in the Arab Peninsula, ISIS, ISIS-Khorasan, which is active in central and south Asia, and the Muslim Brotherhood.

Expanding Resources and Partnerships

Overall, the new strategy document describes an effort to reinvigorate counterterrorism efforts under Trump’s tenure. That includes allocating additional domestic resources and bolstering international partnerships.

The document described the move to designate cartels and other transnational gangs as foreign terrorist organizations as one such step “to make available additional intelligence authorities and deny and disrupt their financial streams and access to the United States.”

Trump is the first U.S. president to apply formal terror designations to such groups and free up counterterrorism authorities to address their activities.

In March, U.S. Secretary of War Pete Hegseth signed a multilateral security cooperation agreement for the Western Hemisphere with 16 counterparts across Latin America and the Caribbean. The agreement included a commitment to join “a coalition to combat narco-terrorism and other shared threats” in the region.

 

Sonora State Police officers conduct an operation in the deserts of Sonora, Mexico, on April 15, 2025. John Fredricks/The Epoch Times

“President Trump has ushered in a new dawn of burdenshifting, and now is the time to work more aggressively with partners to crush lingering terrorist threats to the United States,” the new counterterrorism strategy document states.

The new document also described the use of diplomatic, financial, cyber, and covert actions to support counterterrorism efforts.

The administration said counterterrorism efforts also include “aggressive information operations to demoralize terror organizations and undermine their anti-American and anti-Western propaganda.”

“We have assets outside the realms of hard security in the informational space that were allowed to atrophy in recent years or were used for partisan political purposes,“ the document states. ”These were previously de-weaponized and must now be reinvigorated to demoralize and delegitimize terror threat groups and their enablers.”

Pledge for Apolitical, Evidence-Based Approach

Although the new counterterrorism guide elevates violent left-wing extremists to one of the three major groups responsible for perpetrating terror against the United States, the strategy document articulates a pledge to guard against counterterrorism authorities being abused for political ends.

“Our counterterrorism operations will be executed apolitically and founded upon reality-based threat assessments,” the document states.

“Our counterterrorism powers will not be used to target our fellow Americans who simply disagree with us. We will not permit the weaponization of America’s unparalleled CT capabilities for partisan purposes and in contravention of every American’s God-given rights.”

Members of the FBI knock on the doors of neighbors of a home associated with the suspected White House Correspondents’ Dinner shooter in Torrance, Calif., on April 26, 2026. Patrick T. Fallon/AFP

The strategy document described U.S. counterterrorism efforts under Trump’s predecessor—President Joe Biden—as being directed against conservatives, Christians, and parents protesting policy changes at school boards.

“Millions of Americans have lost confidence in the rectitude of the most powerful elements of our Federal government; the national security apparatus of the United States,” the document reads.

“That confidence can only be won back when counterterrorism is executed uninfected by politics, and if those who used their counterterrorism powers as a weapon against the innocent pay the full judicial cost for their crimes against the civil rights of innocent Americans.”

Tyler Durden Sat, 05/09/2026 - 22:10

Cameco Sees As Many As 20 AP1000 Nuclear Reactors On The Horizon

Cameco leadership recently made announcements during their 2026Q1 earnings call regarding an expectation that as many as 20 AP1000 reactors will be announced for construction with support from the Department of Commerce (DOC) and the Department of Energy (DOE). 

Grant Isaac, the Chief Operating Officer and President of Cameco, provided some color on the call for the difference between the different department efforts and the stages of discussions under each. 

We covered the announcement from the DOC at length last fall, providing details on the $80 billion agreement between the US government, Brookfield and Cameco to deploy up to 10 AP1000 reactors across the US.

Few updates have been given to this program so far. But Isaac comments that the “project continues to move along”. The efforts under the DOC contract appear to be focused on “long lead items that are required in order to stand” up a fleet of large reactors. 

Considering the domestic and global supply chain outside of China and Russia has been more focused on sustainment and decommissioning, there is currently a lack of capacity across all the involved companies to build multiple reactors a year. 

The sole-producer of the reactor cooling pumps for Westinghouse AP1000 reactor plants, Curtiss-Wright, recently remarked that they only have capacity to produce enough pumps for three to four reactors per year. Significant expansion efforts will be required to remove deployment roadblocks for multiple different systems and components. 

Another question trying to be answered under the DOC program is under what model the reactors could be built. Isaac says. Isaac said, “those models could be a range of things from a federal build, own and operate to a federal build-own transfer model all the way to perhaps a financing of an existing nuclear operator who simply is just looking for financing.”

But the ten large reactors being pursued under the DOC plan are apparently completely separate from as many as ten reactors that are being pursued under the DOE.

There are a number of utilities progressing towards the construction of pairs of AP1000 reactors, with “five or six of them in very advanced stages”. These utilities are coordinating with the DOE and the Office of Energy Dominance Financing to secure loans for the projects, as well as potentially ordering long lead items ahead of time. 

“So when you step back and look at it, the U.S. isn't just talking about potentially 10 reactors under the DOC program. They’re potentially telling about another 10 under the DOE more traditional approach.”

Tyler Durden Sat, 05/09/2026 - 21:35

Trump Congratulates Incoming Iraqi Leader, Who Moves To Disarm Pro-Iran Militias

Via The Cradle

A committee comprising three senior Iraqi figures is close to finalizing an "executive plan" to disarm factions within the Popular Mobilization Forces (PMF) that enjoy support from Iran, Asharq Al-Awsat reported on 8 May.

Development of the plan, which will be presented to US officials in the next few days, comes amid expected changes to the leadership of key security agencies under the incoming government of Ali al-Zaidi.

Trump congratulates Iraq PM nominee Ali al-Zaidi, eyes stronger ties

Zaidi was nominated by the Shia-majority Coordination Framework (CF) political bloc on April 27 as the consensus candidate to succeed Prime Minister Mohammed Shia al-Sudani. According to sources speaking to the Saudi newspaper, the three-member committee includes Zaidi, Sudani, and the leader of the Badr Organization, Hadi al-Amiri.

Washington has intensified pressure on Iraq's ruling Shia political parties to disarm the anti-terrorist militias and prevent their representatives from participating in the new government.

The sources revealed that the committee has held secret negotiations with leaders of the factions, providing their leaders with "ideas on how to disarm and integrate fighters."

Sources told Asharq Al-Awsat that the Badr Organization leader Amiri, who enjoys close relations with Iran, "was supposed to help build trust with the factions and persuade them to engage with the state." However, some meetings "did not proceed calmly" due to the request to disarm.

A spokesperson for one faction within the PMF said that Kataib Hezbollah, Kataib Sayyid al-Shuhada, and Harakat al-Nujaba rejected handing over their weapons to any party whatsoever. The spokesperson, who spoke on condition of anonymity, said the three factions were "prepared to pay any price resulting from their refusal to disarm."

The PMF were created in 2014 with support from Iran's Islamic Revolutionary Guard Corps (IRGC) Quds Force to fight ISIS and were later formally incorporated into the Iraqi armed forces.

During the war between the US and Iran that began on 28 February, the US air force bombed PMF positions across the country, while the resistance factions carried out drone attacks against US bases in the Iraqi Kurdistan Region (IKR) and the US embassy in Baghdad.

In a phone call last Wednesday, US Secretary of War Pete Hegseth reportedly told Zaidi that Washington that the legitimacy of his incoming government would depend on its ability to distance the armed factions from the apparatus of the state.

A senior political official told Asharq Al-Awsat that the three-man committee had, under mounting US pressure, accelerated its work in recent weeks to disarm the factions. The official added that the executive plan included restructuring the PMF and ensuring it hands over its heavy and medium weapons, while the US is pressuring Baghdad to disband the PMF entirely.

Asharq Al-Awsat reported that former US General David Petraeus may visit Baghdad this week to ensure that "the new government fully severs its ties with the armed factions.

Petraeus, who holds no formal government position currently, commanded the 101st Airborne Division during the 2003 invasion that toppled the government of Saddam Hussein. He later became CIA director, overseeing the covert war in Syria in partnership with Al-Qaeda.

In 2004, he worked with some of the leaders of the Iran-backed armed factions, including Hadi al-Amiri, to establish a new Iraqi police force after Iraq's army and police were disbanded by the US occupation head, Paul Bremer.

Iraqi police commandos operating under Petraeus and Iraq's Ministry of Interior, in particular the Wolf Brigade, were known for abducting, killing, and torturing Sunni Muslims. Some of the police commandos were trained by US commander James Steele, who was known for running death squads in El Salvador in the 1980's.

On Friday, Republican Party member Malik Francis told Shafaq News Agency that the US administration "appears so far to be cautious in its dealings with Ali al-Zaidi, but it is not showing a direct hostile stance towards him."

Francis stated that Washington is not yet giving Zaidi a "blank check," but at the same time, it is not treating him as an adversary. On Thursday, the US Treasury Department announced it had imposed new sanctions on a list of Iraqi individuals and companies for their alleged connection to Iran.

Politicians from the CF said the sanctions may have been intended to "block undesirable nominations" to posts in the new government and "steer the process toward other candidates."

The PMU factions are reportedly exploring the possibility of avoiding direct participation in the new government, while backing figures described as independent for ministerial positions to maintain indirect influence over those posts.

Tyler Durden Sat, 05/09/2026 - 21:00

"Exponentially Deteriorating": Baltimore's Lawlessness Spreads Into Suburbs As Democrats Lose Control

Maryland is one of many blue states that have transformed into a failed progressive experiment, where net migration flows are negative as productive, working-class taxpayers flee the state, not just because of high taxes and the power bill crisis, but also because they've had enough of left-wing politicians and their failed criminal justice and social reforms that have fueled a decade of violent crime chaos.

We've extensively covered more than a decade of violent crime, riots, population collapse, and the exodus of taxpayers and businesses from imploding Baltimore City, which has been hit hard by a commercial real estate crisis in parts of the downtown area. But rarely have we focused on Baltimore County, just north of the city, where, yet again, left-wing politicians who masquerade as competent managers but are merely DEI activists have unleashed years of lawlessness through failed policies.

FOX45 News spoke with Mickey Hoppert, a retired sergeant with the Baltimore County Police Department who has spent more than two decades on the force, warned about the lawlessness of juveniles in the Towson metro area:

I wouldn't say that it's out of control, but it's getting there. Baltimore County is slowly, actually it's not slowly, it's exponentially deteriorating, and there are more and more pockets of bad elements coming into the county and wreaking havoc.

"I wouldn't say that it's out of control, but it's getting there. Baltimore County is slowly, actually it's not slowly, it's exponentially deteriorating," Mickey Hoppert, retired sergeant with the Baltimore County Police Department, said. "There are more and more pockets of bad… pic.twitter.com/oc7hizFsdt

— FOX Baltimore (@FOXBaltimore) May 5, 2026

Hoppert identified Towson as a major hub for juveniles to meet up and cause chaos over the last ten years.

"It's easy access here," he said. "Bus lines come here. Friends and family can bring them here."

He pointed out that current juvenile laws in the deeply blue county do not support officers and have been nothing but demotivating towards the department.

"When I say nobody supporting them, I mean the judicial system, the judges, they're not supporting them because the laws don't allow them to. The newer laws that have been enacted by lawmakers," Hoppert said. "Revamp the laws. Go back in and look at the laws and see what they can do to change them and make them more, more beneficial to the public and actually make it so that there is a consequence for the action that the juvenile commits."

The current reading of population data in Baltimore County indicates it has lost population since 2020. The decline is modest, but it shows that population growth is quickly losing momentum as residents flee not just the county, but the state, seeking common-sense politicians in red states that offer low taxes and law and order.

At the state level, the failures are piling up for left-wing Gov. Wes Moore, whose polling data has sunk and alarmed the Democratic Party. The governor faces an ongoing trust issue with voters as Sinclair Broadcasting's David Smith wages an informational war on the unhinged leftist in the state.

Since Gov. Wes Moore took office in January 2023, Maryland's fiscal profile has deteriorated sharply. The state entered Moore's first term with a roughly $5 billion surplus, but by 2025, it was facing a $3.3 billion deficit. This swing from surplus to deficit only suggests how Democratic leftists in Annapolis spent taxpayer funds on failed progressive experiments.  

Tyler Durden Sat, 05/09/2026 - 20:25

From Civilian To Military Economy: This Is What A Declining Empire's Economy Looks Like

Authored by Bryan Lutz via DollarCollapse.com,

“A government always finds itself obliged to resort to inflationary measures when it cannot negotiate loans and dare not levy taxes, because it has reason to fear that it will forfeit approval of the policy it is following if it reveals too soon the financial and general economic consequences of that policy.”

~ Ludwig von Mises, The Theory of Money and Credit (1912)

Empires don’t announce their decline.

They reveal it in the data…

And on Monday, the U.S. Census Bureau quietly published the latest installment.

Rome elevated the military as the empire decayed.

Britain did the same after 1914.

And after 1971, when Nixon severed the dollar from gold, America began the same process.

The factory floor is where it shows up first…

So let’s look at it.

March 2026 defense capital goods orders: up 18 percent month-over-month.

But, year-over-year, it’s a much larger number: up 80 percent.

Non-defense capital goods? Down 1.2 percent, which makes it the sixth contraction in seven months.

Strip out defense production, and the headline factory number moves negative.

Now, the United States isn’t exactly in full-on war economy yet. It’s what a peacetime empire economy looks like in late stage.

Here’s what the transition looks like on the chart, defense versus non-defense aircraft orders, last 24 months:

One of those lines is paid for by the Pentagon writing a check. The other is paid for by airlines and freight companies deciding they want to expand. Guess which kind of order an empire prioritizes when it’s running out of money.

And here’s where it gets interesting.

Ludwig von Mises wrote in 1912:

“A government always finds itself obliged to resort to inflationary measures when it cannot negotiate loans and dare not levy taxes, because it has reason to fear that it will forfeit approval of the policy it is following if it reveals too soon the financial and general economic consequences of that policy.”

You see, a Federal government has three ways to pay its bills.

1. It can tax.

2. It can borrow.

3. Or it can print.

If the US government were to tax citizens for $2.5 trillion in defense spending they’d revolt by Tuesday.

If they were to borrow it from foreigners who are already net sellers of Treasuries? Good luck.

That leaves the printer.

Every empire elevates the military as the civilian economy decays. Rome did it under Diocletian. The British did it after 1914. America started in 1971.

The Vietnam-era proof is the cleanest.

After the war ended, federal spending kept rising. The 1969 federal surplus of $3 billion turned into a $23 billion deficit by 1972, with the war winding down.

America didn’t exactly demobilize after that. Instead, they redirected attention.

In fact, look at where the redirection is going right now.

The Pentagon’s 2027 national security request will exceed $2.5 trillion. The cost of the Iran war isn’t even in that budget.

And the money supply just surged to a multi-year high. The Fed has quietly restarted QE.

So, the Pentagon gets more airplanes.

You can see what that printing looks like in the chart, below. Federal interest expense just crossed $1 trillion trailing twelve months, and M2 is heading vertical:

Mises predicted this curve. The Census Bureau is now reporting it.

And that’s why every empire’s late-stage transition ends the same way.

Eventually, the currency thins out, military thickens up, and the middle class evaporates between them.

Weimar Germany. Late-stage Rome. The Soviet Union in its last decade.

Each time, the people who held the State’s paper got wiped.

Each time, the people who held gold got out.

This week, the Fed will move closer to the cut. The Treasury will sell another half-trillion next week. Defense will keep ordering. And Civilian CapEx will keep contracting…

This is what a declining empire’s economy looks like. There just hasn’t been an announcement yet.

Tyler Durden Sat, 05/09/2026 - 19:50