Zero Hedge

What To Know About Iran's Pickaxe Mountain

What To Know About Iran's Pickaxe Mountain

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

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

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

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

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

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

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

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

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

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

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

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

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

 

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

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

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

Canada's Wildfire Management Failures Choke Millions Of Americans With Toxic Smoke

Canada's Wildfire Management Failures Choke Millions Of Americans With Toxic Smoke

Canada's wildfire management policies are once again falling short, as toxic smoke plumes blanket much of the northeastern US and drive air pollution to dangerously high levels. 

Air quality readings in cities including Detroit, Milwaukee, and Toledo exceeded 500, well above the 300 threshold considered unsafe. Chicago, Cleveland, Minneapolis, and Toronto also recorded unsafe levels, while conditions in Washington, Philadelphia, and New York deteriorated into unhealthy territory.

At this time of year, smoke from Canadian wildfires usually pours into the US, exposing tens of millions of Americans to dangerous air quality.

The recurring cross-border pollution is Canada's repeated failure to address wildfire prevention and mitigation adequately.

"Canada continues to fail to manage its forests. Controlled burns, thinning and clearing debris would go a long way toward preventing this from happening every summer," the conservative environmental nonprofit American Conservation Coalition wrote on X. 

It should be investigated whether arson or inadequate forest management has contributed to the wildfire chaos in Canada, which is imposing major health risks on the US. Much of the left-wing media points to climate change, while rarely covering forest management failures.

Tyler Durden Thu, 07/16/2026 - 17:20

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

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

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

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

  • EPS 80c, barely beating the est 79c, and up from 72c y/y
  • Revenue $12.56 billion, +13% y/y, barely beating the est $12.58 billion
    • US & Canada revenue $5.43 billion, +10% y/y, missing estimate $5.52 billion
    • EMEA revenue $4.03 billion, +14% y/y, matching estimate $4.03 billion
    • Latin America revenue $1.58 billion, +21% y/y, beating estimate $1.51 billion
    • APAC revenue $1.51 billion, +16% y/y, missing estimate $1.53 billion
       
  • Operating income $4.19 billion, +11% y/y, beating estimate $4.13 billion
    • Operating margin 33.4% vs. 34.1% y/y, beating estimate 33%
       
  • Cash flow from operations $1.74 billion, -28% y/y, missing estimate $2.93 billion
    • Free cash flow $1.53 billion, -33% y/y, badly missing estimate $2.72 billion... maybe they too are building a data center.

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

Q3 forecast

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

Full year forecast 

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

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

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

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

Translation: crap content, now with even more slop.

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

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

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

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

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

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

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

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

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

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

The Odyssey Hullabaloo

The Odyssey Hullabaloo

Authored by Victor Davis Hanson via American Greatness,

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

A final note.

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

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

American Naval Academy Cadets Prepare For War With Stoic Philosophy

American Naval Academy Cadets Prepare For War With Stoic Philosophy

Authored by Ret Admiral Cem Gürdeniz via Mavi Vatan Geopolitics,

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

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

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

The Foundation of Imperial Power Is Naval Power

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

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

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

Religion and Its Place in American Politics

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

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

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

Stoic Training for American Naval Officer Candidates

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

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

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

Why Stoicism?

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

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

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

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

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

Change in American Society

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

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

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

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

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

Fighting in the Mud

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

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

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

Conclusion

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

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

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

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

Sources:

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

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

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

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

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

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

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

via Marine Insight

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

The Six Vectors Of Gold Remonetization Revealed

The Six Vectors Of Gold Remonetization Revealed

Authored by Ronnie Stoeferle via VonGreyerz.gold,

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

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

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

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

The six vectors Vector I: Reserve Function & Sovereignty

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

Vector II: Private Remonetization

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

Vector III: Accounting & Recapitalization

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

Vector IV: Anchoring Through Gold-Backed Bonds

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

Vector V: Western Central Banks as Buyers

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

Vector VI: Digitalization

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

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

Remonetization is taking shape

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

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

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

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

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

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

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

What Connects the Six Vectors: Feedback Loops

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

Feedback instead of addition

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

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

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

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

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

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

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

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

An Overview of the Vectors

 

Arguments against the concept – and why we remain convinced

 

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

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

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

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

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

  • Significant debt reduction through real economic growth or fiscal consolidation

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

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

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

The burden of proof has shifted

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

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

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

The shadow gold price

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

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

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

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

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

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

Authored by Nicholas Zifcak via The Epoch Times,

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Global PC shipments: consumer vs. commercial

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

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

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

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

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

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

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

Authored by Micah Zimmerman via BitcoinMagazine.com,

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

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

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

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

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

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

Bankman-Frieds’ attempts to get out of jail

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

He is not eligible for release until around 2044.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

US Slaps Brazil With 25% Tariffs After Rubio Says Socialist Leader "Failed To Negotiate In Good Faith"

US Slaps Brazil With 25% Tariffs After Rubio Says Socialist Leader "Failed To Negotiate In Good Faith"

US Secretary of State Marco Rubio revealed on X late Wednesday night that the Office of the United States Trade Representative (USTR) is set to impose a 25% tariff on "most Brazilian imports."

"Let there be no confusion about why: President Lula and his government have not negotiated with the US in good faith," Rubio said.

He added, "His economic policies are bad for Americans and bad for Brazilians. For the past year, Lula has put his own ego ahead of making a deal for the welfare of the Brazilian people, and these tariffs are the price for that."

USTR released a statement saying the 25% tariffs on certain Brazilian goods come after a yearlong Section 301 investigation that found trade and regulatory practices in the South American country unfairly restricted US commerce.

"Safeguarding American economic interests against unfair trade practices is the bedrock of President Trump's America First policies," Trade Representative Jamieson Greer wrote in a statement.

Greer commented on Bloomberg TV: 

Bloomberg cited a senior administration official who said imports of coffee, beef and certain ethanol products would be exempt from the new duties.

Honing in on Rubio's X post, which said Lula's “economic policies are bad for Americans and bad for Brazilians," the bigger issue here is that Lula is an unhinged socialist.

The Trump team, along with folks adjacent to the administration, has been working to reshape Latin America's political landscape by shifting the region away from socialist governments sympathetic to China and toward right-wing, capitalist governments more aligned with the US. The effort is part of a broader Western Hemisphere defense strategy.

Americas Political Map: Presidential Shift From Left To Right

Country-by-country presidential shift tracker

Following the stunning Colombian presidential race, in which Trump-backed Abelardo de la Espriella won the election, the next major race to watch will be Brazil's. Lula is expected to face right-wing Senator Flávio Bolsonaro in the run-up to October's presidential election.

Tyler Durden Thu, 07/16/2026 - 10:25

Das: Déjà Vu All Over Again! Are Stock Markets Repeating Dot.Com Mistakes?

Das: Déjà Vu All Over Again! Are Stock Markets Repeating Dot.Com Mistakes?

Authored by Satyajit Das via NewIndiaExpress.com,

The sky-high valuations of space and AI firms today are similar to that of internet ventures before 2000. Herd instinct is leading promoters and investors, not financial and technological reality

Burning cash rapidly, with large unfunded commitments, space and AI businesses are all dependent on uncertain funding access (Express illustrations | Mandar Pardikar)

The listing of SpaceX and forthcoming artificial intelligence floats bear similarities to the lead-up to the 2000 dot-com crash, which resulted in losses of over $5 trillion.

Even survivors like Amazon, Microsoft, Cisco, Dell and eBay, which had sufficient cash to ride out the turmoil, suffered massive falls in share price that took years to recover.

Today, familiar mistakes around technology, investment approach, business models, valuation and oversight are being repeated. Like the actress Tallulah Bankhead, investors believe that if they have to live life again, they want to make the same mistakes—only sooner.

The dot-com boom was built around the internet, its enabling infrastructure and retail commercialisation as applications developed. Investors with little technical knowledge piled in, hoping for huge returns. Today’s focus is space and AI. 

Take SpaceX, an unwieldy conglomeration of Starlink satellite operations, a space launch business, a controversial social media service, a struggling AI venture as well as plans for orbital data centres, a moon base and an inter-planetary colonisation programme. The satellite broadband and X platforms use established technologies, but the launch business’s cost advantage relies on reusable rockets that remain a work in progress. Orbiting data centres and interplanetary colonies are technically unproven. The SpaceX prospectus provided unhelpful techno-babble—extending “the light of consciousness to the stars” and harnessing the sun “to power a truth-seeking AI”.

During booms, investors aggressively finance prospects with limited understanding and less due diligence, feeding herd-like tactics and poor business models that amplify risks and speculative excess. While some lessons have been learnt, others are recurring. SpaceX’s launch revenues are underwritten by the US government. That business and Starlink will face significant challenges from nationally sponsored and subsidised competitors, especially in Europe and Asia, because of increasing reluctance to outsource critical national infrastructure to US interests. 

Then there are other AI businesses hitting the stock market in the months ahead. One reason OpenAI pivoted away from a retail to an enterprise focus, replicating Anthropic’s strategy, was lacklustre conversion of free users to subscriptions. But companies have balked at the cost as suppliers switch from subscription models to payment for tokens, with many users now placing caps on usage.

OpenAI and Anthropic’s income and growth are also affected by increasing competition from cheaper, open-sourced—primarily Chinese—models, the threat of regulation and export bans because of potential AI security applications. The cost of the models themselves is growing because of scarcity of skills alongside shortages of processors, electricity and water for cooling.

These businesses all have uncertain paths to profitability, with SpaceX, whose primary profitable business currently is Starlink, warning in its prospectus: “We have a history of net losses and may not achieve profitability in the future.” Burning cash rapidly, with large unfunded commitments, these businesses are all dependent on uncertain funding access.

Yet, valuations have again decoupled from reality. In October 1999, shortly before the dot-com crash, the market cap of 199 internet stocks tracked by Morgan Stanley was $450 billion, against annual sales of about $21 billion and collective losses of $6.2 billion. Now consider that SpaceX raised around $75 billion in June, based on a market valuation of almost $1.8 trillion, or over 90 times of current revenue and 220 times earnings. Analysis by Morningstar argued that even using generous assumptions SpaceX was worth less than half that amount. OpenAI and Anthropic are expected to be valued in excess of $1 trillion. These values would be higher than those implied by their latest funding rounds. 

Current prices are not shaped by future free cash flows, but expressions of tribal affiliation and identity alongside deep faith in a technology. On the day that SpaceX listed, an equity trader gave a speech on the firm’s trading floor: “In 1969 we put a man on the moon… Now let’s go to Mars!” For many, SpaceX shares were cheap on a new extra-terrestrial measure: a price-to-universe ratio!

With negative earnings and cash flow, in a reprise of 2000, values are based on unreliable indicators like ‘eyeballs’ (unique website visitors or page views). With loss-making companies currently trading at a premium to money-making firms, as in the late 1990s, promoters do not want to be profitable as it would mean a lower valuation.

As in 2000, there is an absence of corporate governance. The imperious Elon Musk, the world’s first paper trillionaire, will control the world’s first ‘orbital infrastructure conglomerate’ using a dual-class share structure that reduces shareholder oversight and ensures that he cannot be removed. Musk’s known disregard for governance and self-dealing strategy shifts were dismissed. 

As in the dot-com bubble, banks, analysts and media, despite obvious conflicts of interest, play a pivotal role amplifying the ‘new economy’ narrative. Goldman Sachs, one of the underwriters, expects SpaceX’s AI revenue to increase 100-fold by 2030. Banks involved in the SpaceX offering received fees totalling more than $500 million. Exchanges desperate to boost the number of tech stocks listed agreed to include SpaceX in indices under expedited entry rules, meaning investors—especially passive investors—would have to sell existing holdings to make way for SpaceX, Anthropic and OpenAI shares. Intermediaries will benefit from large trading volumes. 

The real purpose of the current round of IPOs is to allow insiders to cash out, transferring risk to over-enthusiastic and unsuspecting investors. In 2000, once the 180-day lock-up period expired, allowing original funders and employees to sell restricted shares, there were widespread sell-offs as supply flooded the market. Listing overvalued stock also provides founders with currency for acquisitions. Musk may merge SpaceX with Tesla, consistent with his previous transactions involving Solar City, Twitter, and xAI. Given his unfettered control of SpaceX, it would obviate the need for an expensive and heavily-leveraged transaction to take Tesla private.

Like the dot-com episode, this too is likely to end badly. To paraphrase historian Christian Wolmar writing about British railways, booms cannot be sustained on “little more than optimism feeding on itself”.

Tyler Durden Thu, 07/16/2026 - 10:05

Vance Slams Israeli PR Campaign To Keep War Going 'Indefinitely', & Undermine Him

Vance Slams Israeli PR Campaign To Keep War Going 'Indefinitely', & Undermine Him

In a new interview on the world's largest podcast, Vice President JD Vance warned that "elements" of the Israeli government want to keep the Iran war going "indefinitely," and were pursuing an aggressive campaign to manipulate US public opinion -- going so far as to vilify Vance for his role in pursuing a diplomatic solution. In his nearly three-hour interview on the Joe Rogan Experience, Vance also tried to gently distance himself from Trump's decision to join Israel in launching a war on Iran and said the White House had botched its communications regarding the Epstein files. 

"There are some people within [Israel's] system, we know beyond a shadow of a doubt, who are manipulating and trying to change American public opinion to keep the war going on indefinitely. Again, not towards any objective, but just indefinitely," Vance said, noting that the attacks have not only been directed against US policy, but against him personally. He directed Rogan and his audience to read a recent Time article describing the big-budget mechanism Israel has sponsored to try to shore up Republican support for the war and for Israel. 

"It’s like worth reading because it lists a bunch of people who have quite literally been paid by a former Trump campaign person who was himself paid by certain elements within the Israeli government. And those people are attacking me viciously for quite literally trying to accomplish the negotiation objective that the president set for the country."

Vance was referring to former Trump campaign manager Brad Parscale, who now runs a communications firm called Clock Tower X. He is also Chief Strategy Officer of Salem Media Group, a conservative multimedia conglomerate. Last summer, Israel started paying Parscale's firm $1.5 million a month to create 100 pieces of digital content every month to be shared across multiple social media platforms. Controversially, Parscale also promised the “integration of narrative messaging into Salem Media Network properties and aligned distribution channels.”

As for how to end a war that's even less popular than the Vietnam War at its worst polling, Vance defended diplomacy and ridiculed hawkish critics whose grand plan is to only to "bomb them to oblivion." While Trump has been threatening to go on a rampage against Iran's bridges and energy infrastructure if the country doesn't bend to his wishes, Vance echoed the wisdom of many military and geopolitical observers who lampoon the idea that the US military can conquer any country -- much less one that's as large as Western Europe -- using only air power: 

“You can bomb them. You can take away their radar. You can take away some of their drones and some of their missiles, but it’s just too easy to fire at ships in the straits. So, you’ve got to actually be willing to talk and to try to figure out the problem.”

With each passing week and month, the unpopularity of the war on Iran looms larger and larger where Vance's 2028 presidential ambitions are concerned. Vance has been using interviews to delicately distance himself from the decision to attack, and he did so again with Rogan. When the podcaster asked Vance about the extent to which he agreed with Trump's decision to launch a war on Iran, Vance deftly used Trump's own characterizations to distance himself from the decision:

"Well, the president said publicly that 'JD was less enthusiastic about it.' I think that was the exact phrase that he used. I mean my attitude towards this, man, as you know, is the vice president— I’m not a public commentator. My job is to give the best advice I can to the president of the United States. I think he’s said a little bit about what that advice was. 

In April, a lengthy New York Times report on the decision to start the war portrayed Vance as a skeptic who warned that a war could unleash regional chaos and involve a high number of casualties -- including damage to Trump's coalition, a large segment of which was attracted by Trump's repeated promises not to start new wars. Describing the fateful meeting on Feb 26 that preceded the war's launch two days later, the Times paraphrased Vance as saying, "You know I think this is a bad idea, but if you want to do it, I’ll support you."

Now, nearly five months later, 14 American service members are dead, more than 400 wounded, more than $100 billion has been squandered, the US arsenal significantly depleted, the Strait of Hormuz is largely closed, fuel prices have soared, a global economic catastrophe lurks, and the Iranian people have rallied around their government. Given the war has turned into such a fiasco, it's not clear how much credit Vance will get for having been anything less than a zealous opponent willing to publicly challenge the war from the start.  

Regarding the Epstein files, Vance disputed the notion that the Trump administration sought to hide anything from the American people, instead attributing the controversy to poor public communications about the files. “We absolutely screwed up the comms of the Epstein files,” Vance said. “We just did. But do I think the reason we screwed up the comms is because we were trying to hide something? No.” He faulted then-US Attorney General Pam Bondi for having "overstated what we had and what we didn’t have,” as she was caught up in "the political moment." 

Though he stopped short of saying Epstein was working for Israel, Vance emphasized Epstein's links to both US and Israeli intelligence agencies. "He clearly had connections to the upper— the highest levels of American intelligence. He clearly had connections to the highest levels of Israeli intelligence," Vance said, later adding, "I’ve asked whether there were documents connecting Jeffrey Epstein directly to our intelligence agencies or anybody else’s, and the answer is no. But if that stuff existed, it wouldn’t exist in 2026." 

Here's the full interview: 

Tyler Durden Thu, 07/16/2026 - 09:45

Cracking Up And Joining Up

Cracking Up And Joining Up

By Michael Every of Rabobank

Geopolitics is front and center, even in Argentina–England at the World Cup, where the contested Falklands/Malvinas, which could have oil reserves, saw jingoist 1980’s language. Yet it’s Hormuz, where 1980’s-style tanker wars are underway, that’s the penalty spot.

The US is striking Iran again night and day, as Tehran warns of an “existential war”. Reports have Trump leaning towards expanding US military operations; others say what he’s been hitting widen his options for escalation; and Trump has stated Iran “will be defeated soon.” However, the Financial Times today leads with Trump’s ex-defence chief saying the US will not win the war from the air, a sentiment echoed in the Wall Street Journal – and boots on the ground are highly unlikely.

Iran is attacking the Hormuz oil lifeline of ship-to-ship shuttle runs, with some vessels now reportedly refusing US-military guided transits. The US just hit a tanker heading for Kharg Island under the renewed Iran blockade, as some wonder again if the US could try to take control of Iran’s southern islands – which would certainly take boots on the ground.

The IRGC has threatened all global energy workarounds to Hormuz: that includes the Red Sea, where the Houthis may be preparing to attack; it might also involve Azerbaijan’s oil trade with Israel, meaning either striking Iran’s well-armed northern neighbour or the Eastern Mediterranean route its oil arrives via. Markets would move markedly if these developments were to occur.

Israel-Lebanon talks are getting some results, with agreement for Israel to pull back from two pilot zones to allow the Lebanese army to prove it can keep the territory free from Hezbollah – the IDF notably just killed three of the latter, and Trump is still talking about Syria fighting Hezbollah instead. PM Netanyahu will meet Trump in the US on Monday, as many fault lines are seen between the two. However, the flurry of radical domestic legislation the Israeli government just launched ahead of an October 27 election Knesset dissolution may suggest the foreign policy arena is not where they will look to flex for would-be voters.

Elsewhere, US General Caine is pleading with defense contractors to build weapons faster, as munitions constraints linger: the US Air Force plans to buy 28,000 low-cost cruise missiles ahead, showing procurement pivots are happening. The Secretary of War is also going to give US troops testosterone shots to make them stronger, as many NATO allies struggle to recruit the soldiers, sailors, and pilots that a military build-up will require; and senior defense officials are pushing for more censorship and are said to be looking at Cuba military options.

The EU again failed to strike a new Russia sanctions deal after three days of talks, with Athens reportedly opposing them to shield a Greek shipping company. On the other hand, the EU and Ukraine struck a deal to tap into €10bn of unspent SAFE funds to build drones in Ukraine – with a carve-out to buy some components from China. Ominously, Lithuanian and Latvian leaders also warned that Russia is planning infrastructure attacks on the Baltics or Poland, with other suggestions of potential false flag operations as the trigger for such.

Against that backdrop, and what Ukraine is doing to Russian refineries, a benchmark Bloomberg measure of crack spreads now stands above the panic peak of 2022, so while Brent oil is $85 --bang in line with where Joe DeLaura expected it to hover at while ‘Comfortably Bomb’ plays out-- the price of a barrel of diesel is around $147.  

The EU also just published a report calling China a “key enabler” and a “crucial enabler” of Russia’s war on Ukraine, further noting that: “At the centre of this transformation lies the determination of some powers, Russia and China foremost among them, to establish regional dominance and reshape the global order in line with their interests, fostering a return to a sphere-of-influence logic.”

That language echoes European complaints already made about the US, as a Pew survey shows that Xi now beats Trump in terms of popularity. But given nobody gets to vote on that, how much does such soft power matter? In that regard, the X thread from the US Under Secretary of War poopooing the idea of Middle Powers having options other than siding with the US (or China), which we noted yesterday, drew polarised reactions.

Those who pushed back strongest came from politics or economics, with a few from the military; by contrast, those who said the blunt (so unhelpful) US argument was true think across those disciplines. As a good example, Velina Tchakarova’s ‘The Middle Power Mirage: Colby, the Sceptics, and the Verdict Nobody Wants’ states: “Here is the strategic reality the convening class prefers to avoid. We are in a new Cold War between two systems, Pax Americana 2.0 and the DragonBear, the structural alignment of Chinese and Russian power across every systemically relevant domain. In that contest, middle powers without sufficient strategic leverage or autonomy will not be neutral conveners. They will be the first victims, hollowed out or cannibalized for the sake of global supremacy, or they will become the battlefield itself. There is no comfortable third space for the underprepared.” She also underlines that preparations can be made for that kind of third space, but they are fiscally, political-economically, and even ‘civilisationally’ uncomfortable.

That’s as EU-China trade data this week saw Brussels state that safeguard measures permitting tariffs and quotas against import surges may “become legitimate on a case-by-case basis.”; the UK Treasury suggest alignment of its financial system with the US, not the EU, and a stablecoins framework that opens the door for the USD variant to be used; Bloomberg says ‘Trump's Aides See China Cheating on Trade, But Shun Retaliation’ - there are too many fish to fry in Hormuz, it seems; and India’s PM Modi is pushing to cut import reliance to shield the economy from shocks.

Against this backdrop, national elections are now more existential than during the 2000’s policy consensus for ever more globalisation. Today, each vote can push or pull economies towards one of the two global poles of power, tipping the balance between them and/or legacy vs emerging stakeholders within them.

In that light, Trump is to give an address today focused on “free and fair elections” rumored to be politically explosive, as Democratic Party Senator Fetterman warns he’ll leave the party if it turns its back on Israel, and Supreme Court justices worried about their safety were told by Congress, “There’s not a money fairy up here.” In the UK, the terror inquiry into the murder of former MP Ann Widdecombe continues, as a man was arrested for threatening to shoot Reform UK leader Nigel Farage, who is involved in a scandal over a cash gift ‘for his security’. The Times of Israel opines that ‘Netanyahu hits new lows in his battle for survival; there will be a great deal of damage for better leaders to undo’; and Ukraine’s President Zelenskyy just ousted his reformist defence minister amid a government reshuffle, which critics have called a serious strategic error.

In short, norms are cracking up around us, not just in refined products, but in less ‘refined’ economics and politics.

To predict how this plays out one needs to join things up; and that involves looking at who is willing to join up, and where.

Tyler Durden Thu, 07/16/2026 - 09:30

UBS: TSMC's 'Surprise CapEx Hike' Reinforces Confidence In AI Supply Chain

UBS: TSMC's 'Surprise CapEx Hike' Reinforces Confidence In AI Supply Chain

TSMC, or Taiwan Semiconductor Manufacturing Co., the world's largest contract chipmaker, raised its 2026 spending and revenue outlook on Thursday morning, a move UBS analysts said "boosts confidence in the AI supply chain."

TSMC manufactures chips designed by companies such as Nvidia, Apple, AMD, Qualcomm and Broadcom. It is a major supplier of Nvidia chips used in AI data centers. The company now expects 2026 capital expenditures of $60 billion to $64 billion, up from its previous forecast of $52 billion to $56 billion, while projecting dollar-denominated revenue growth of slightly more than 40%.

Here are second quarter results (courtesy of Bloomberg):

  • Net income NT$706.6 billion, estimate NT$623.73 billion
  • Gross margin 67.7%, estimate 67.1%
  • Operating profit NT$766.6 billion, estimate NT$742.75 billion
  • Operating margin 60.3%, estimate 58.6%
  • Sales NT$1.27 trillion, estimate NT$1.27 trillion

Third quarter forecast:

  • Sees sales $44.6 billion to $45.8 billion, estimate $43.11 billion (Bloomberg Consensus)
  • Sees gross margin 65% to 67%, estimate 65.9%
  • Sees operating margin 56% to 58%, estimate 57.7%

"AI-related demand continues to be extremely robust," TSMC Chairman C.C. Wei told analysts on a post-earnings call. 

TSMC also plans to invest another $100 billion in Arizona, lifting that total commitment to $265 billion. The expansion will include additional 2-nanometer chip plants and advanced packaging facilities to meet multi-year demand across the Americas. 

Wei added, "This is to build several or more semiconductor logical wafer fab for two nanometer MP [mass production] technologies, as well as advanced packaging fabs to support the strong multi-year demand from our leading U.S. customers."

CFO Wendell Huang said, "Our conviction in the AI megatrend is very strong.The capex in the next three years will be even more, significantly higher than in the past three years."

UBS analyst Crystal Hsu told clients earlier that "TSMC's Surprise Capex Hike Boosts Confidence In AI Supply Chain."

Hsu continued:

Despite TSMC's relatively conservative gross margin outlook for Q2 and Q3, investors generally believe the company prioritizes customer relationships and may smooth margin trends through the second half of the year.

The increase in capex guidance to USD 60–64 bn came as a positive surprise, as TSMC rarely raises capex guidance in Q2 and the magnitude of the revision exceeded 10%. Investors expect a positive read-through for the semiconductor production equipment (SPE) space.

More importantly, TSMC's constructive commentary could help restore market confidence, as many investors see little change in the underlying fundamentals despite the market pullback over the past month, which appears to have been driven largely by positioning and sentiment rather than by a deterioration in fundamentals.

Shares of TSMC were marginally higher in Asia, closing up a little more than 1%. The stock has gained 59% this year as the AI boom propels chipmakers to new highs. But in recent weeks, the AI trade has hit a brick wall as Goldman warns of rising hyperscaler bond issuance and mounting stress in credit markets.

TSMC's accelerating expansion comes a day after ASML Holding delivered strong earnings and raised its full-year guidance. ASML produces lithography machines, the equipment that chipmakers such as TSMC use to manufacture advanced semiconductors.

Tyler Durden Thu, 07/16/2026 - 06:55

Ukraine Intensifies Attacks On Russian Tankers In The Black Sea

Ukraine Intensifies Attacks On Russian Tankers In The Black Sea

By Charles Kennedy of OilPrice.com

After striking 116 vessels linked to Russia’s shadow fleet in the Sea of Azov in recent weeks, Ukraine’s military is turning its sights on ships in the Black Sea, hitting in drone attacks as many as 20 vessels overnight on Wednesday.

Ukrainian forces struck 17 Russia-linked oil tankers, 2 gas carriers, and one tugboat early on July 15, drone unit commander Robert Brovdi said on Telegram today, adding that an official report with video evidence would follow later in the day.

“The first round of the naval battle is over,” the commander wrote, referring to the Sea of Azov, where Ukraine had focused its drone attack efforts in the past few weeks, alongside targeting refineries deep into Russian territory.

“Now, the Black Sea,” Brovdi said, hinting that Ukraine’s campaign to strike oil and gas vessels is expanding to the Black Sea, a key export route for crude and fuels from the south of Russia.

Ukraine has ramped up drone attacks against Russian shipping in the Sea of Azov and Taganrog Bay. Ukrainian officials reported striking 15 vessels in a single overnight operation on July 14, bringing their total to over 105 targeted ships within an eight-day window. These strikes have been targeting tankers and cargo ships suspected of belonging to Russia’s "shadow fleet" or transporting looted Ukrainian grain and fuel supplies.

Russia has also attacked commercial vessels near Odesa. A Tuesday attack killed five seafarers and injured 12 others in one of the deadliest single strikes on commercial shipping since the start of the war. According to Odesa authorities, a Russian drone struck a Togo-flagged general cargo ship while it was unloading fertilizer, sparking a major fire, while the Russian defense ministry claims the strikes were targeting military cargo.

The ramp-up of the naval strikes comes alongside a months-long Ukrainian campaign to hit Russian refineries to cripple fuel supply and deepen the fuel crisis in Russia.

Tyler Durden Thu, 07/16/2026 - 06:30

G7 Partners Have Low Confidence In President Trump

G7 Partners Have Low Confidence In President Trump

Confidence in U.S. leadership has fluctuated significantly over the past two decades, closely tracking changes in the occupant of the White House.

As Statista's Felix Richter shows in the following chart, based on data from past and present editions of Pew’s Global Attitudes Survey shows, confidence in President Donald Trump among key U.S. allies has mostly been low, although it has edged up slightly compared to the end of his first term.

 G7 Partners Have Low Confidence in President Trump | Statista

You will find more infographics at Statista

Interestingly, Trump’s current ratings are broadly in line with those recorded for George W. Bush toward the end of his presidency.

Bush’s low standing in many Western European countries at the time was largely shaped by opposition to the Iraq War and broader concerns about U.S. foreign policy.

By contrast, confidence in U.S. leadership rebounded sharply under Barack Obama, who consistently received high approval ratings across G7 countries.

While views of Joe Biden were also relatively positive, they never reached Obama era highs and deteriorated gradually over time.

Overall, the data highlights how strongly international perceptions of the United States tend to shift with changes in leadership and foreign policy direction.

Tyler Durden Thu, 07/16/2026 - 05:45

Japan's Landmark Vote Reclassifies Bitcoin And Crypto As Financial Assets

Japan's Landmark Vote Reclassifies Bitcoin And Crypto As Financial Assets

Authored by Micah Zimmerman via The Epoch Times,

Japan’s parliament passed an amendment on Wednesday that reclassifies cryptocurrency as a “financial asset,” a shift that pulls bitcoin and other digital assets out of the country’s payments regime and into the framework that governs stocks, bonds, and investment trusts, according to a report from public broadcaster NHK.

The change strips crypto of its prior status under the Payment Services Act, where regulators treated it as a means of settlement, and folds it into the Financial Instruments and Exchange Act (FIEA), the same statute that oversees traditional securities. 

The amendment moves bitcoin and other crypto under a single investor-protection standard. NHK reports the change takes effect within a year, with a target of fiscal 2027.

Japan’s new authority over bitcoin and the crypto asset class

Japan’s cabinet first approved this measure as a draft amendment in April 2026, but that step only sent the bill toward the Diet for debate. Wednesday’s vote marks the final enactment into law, alongside formal approval of a separate plan to cut the top tax rate on crypto gains from 55% to a flat 20% starting in 2028.

The move rewires how Japan supervises the asset class. As financial instruments, crypto assets now fall under insider-trading rules that bar issuers, exchange operators, and other parties with access to non-public information from trading ahead of events such as token listings, delistings, or major technical incidents.

Exchanges face new disclosure obligations. Platforms must publish data on each token’s issuer, blockchain design, and volatility profile, a standard that mirrors the reporting demands placed on securities firms. Regulators also gain broader market-surveillance authority over the sector, according to local reports. 

Penalties climb under the new law. The maximum prison term for unregistered crypto operators rises from three years to 10, while the top fine increases from 3 million yen to 10 million yen, near $62,000. The tougher enforcement signals a move to treat crypto misconduct with the same severity as securities fraud.

A path to bitcoin ETFs and a tax cut

The reclassification carries two consequences that reach beyond compliance.

First, it opens a path for spot bitcoin exchange-traded funds. Because FIEA governs the products that funds can hold, moving crypto under its umbrella removes a structural barrier that kept Japanese asset managers from launching regulated bitcoin ETFs.

Second, it clears the way for a tax overhaul. Japan taxes crypto gains as miscellaneous income at rates that reach 55 percent, among the steepest treatment in any major market. Lawmakers approved a plan to cut the top rate to a flat 20 percent, a level that matches the tax on stock gains. The reduction, tied to the 2026 Tax Reform Outline, activates in 2028.

The reforms arrive as Japan accelerates a broader Web3 push and as regulators weigh reserve requirements for exchanges that resemble the buffers held by securities firms. User accounts on Japanese exchanges have grown, and domestic crypto firms are positioning for a wider base of retail investors.

For an industry that has long viewed Japan as an early and cautious mover, the vote marks a decisive turn toward legitimacy. 

The country that once served as a template for crypto regulation is now aligning digital assets with its capital markets, a decision that could pressure other jurisdictions to follow.

Tyler Durden Thu, 07/16/2026 - 05:00

Pages