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US Industrial Production Disappoints (Again) In June

US Industrial Production Disappoints (Again) In June

US Industrial Production rose just 0.1% MoM in June (less than the 0.2% MoM rise expected), after also disappointing in May. That slowed the annual growth in production from 1.6% YoY to +1.1% YoY...

The recent blip higher in Capacity Utilization faded last month (76.1% vs 76.2% exp) with the down-trend seemingly still in tact...

If 'soft' survey data is in any way predictive of reality, then we should be seeing a sizable trend higher in industrial production...

...or maybe it's just another useless sentiment signal.

Tyler Durden Fri, 07/17/2026 - 09:21

Historic NYC Church Torched In Confirmed Arson - City Rejects Save Plan As Demolition Ordered

Historic NYC Church Torched In Confirmed Arson - City Rejects Save Plan As Demolition Ordered

Authored by Steve Watson via Modernity.news,

The FDNY has now confirmed what many suspected from the start: the massive fire that gutted the historic South Bushwick Reform Church in Brooklyn was intentionally set. The 1853 landmark, a Greek Revival structure that served generations of worshippers as both a house of faith and a community hub, is a total loss, and it will be completely torn down.

CBS New York reported the determination this week. Pastor James E. Steward II made clear the congregation never saw it coming.

"It was more than just a building. It's lives and generations of lives that have been touched," Steward said. "We have no known enemies."

He added: "Now we understand it is intentional, which brings another layer of grief to myself, as well as the congregation and the community." And: "Whoever is responsible for this ultimately has to answer to God."

No arrests have been made. Investigators previously noted a person of interest seen fleeing the scene on video shortly before the June 19 blaze erupted. The three-alarm fire brought down the steeple and left the wooden structure irreparable in the eyes of city officials.

Yet the congregation and local supporters pushed to preserve what remained. An independent structural engineer assessed the site as sound enough for restoration efforts focused on the attached fellowship hall and surviving elements. The city's Department of Buildings rejected the plan. Demolition is set to begin in August. The agency is led by Commissioner Ahmed Tigani.

This is not an isolated loss. Just weeks earlier, a 138-year-old church in Astoria, Queens, suffered a devastating "mystery" fire in April. The city rejected proposals to rebuild. The structure was demolished two weeks later.

The losses mirror those in Europe, where a spate of church attacks have occurred.

In France, nearly 50 fires or arson attempts hit churches and Christian sites in a single recent year - a sharp rise - with authorities recording a Christian religious building vanishing every two weeks through fire, collapse, or deliberate damage.

Recent examples include the June blaze that destroyed most of the roof at the 17th-century Chapelle Sainte-Anne-des-Rochers in Brittany and the gutting of the Église Saint-Cyriaque in Montenach.

 

Canada has seen the same. Historic churches have been reduced to ashes with causes left unresolved and little urgency from authorities.

In the UK, churches face routine attacks while official outrage is selectively applied. A historic London church burned to the ground amid government silence, even as leaders scrambled to respond to incidents involving other faith sites.

 

In New York the physical symbols of the city's Christian heritage are vanishing under official processes that prioritize teardown over preservation. The South Bushwick congregation is left raising what funds it can while the city bills the church for its own demolition and prepares the site for whatever comes next. The Astoria church is already gone.

These buildings stood for more than a century as anchors of community and continuity. Their rapid destruction, followed by bureaucratic refusal to allow rebuilding, fits a larger pattern playing out from Brooklyn to Quebec to provincial France. The foundations that built Western cities are being burned and demolished.

Tyler Durden Fri, 07/17/2026 - 08:55

Watch: Trump Reveals 'Shocking' Election Vulnerabilities Including 278,000 Fraudulent Voters

Watch: Trump Reveals 'Shocking' Election Vulnerabilities Including 278,000 Fraudulent Voters

Update (2110ET): Trump has released several major election-related findings: 

  • Mass declassification event - The White House just released previously classified Intelligence Community assessments and reports on election infrastructure spanning January 2020 through June 2026.
  • Adversary capability finding - A quoted IC assessment states Russia, China, Iran, North Korea "at a minimum," plus non-state groups, have the capability to compromise U.S. election infrastructure.
  • Weakest-link identification - Centralized data repositories (voter registration databases, pollbooks, official election websites) are assessed as the systems most vulnerable to exploitation and disruption.
  • Venezuela proof-of-concept - CIA reporting allegedly detailed a Maduro-regime plot to digitally rig Venezuela's 2020 elections using methods that could alter vote totals undetectably "even with an audit."
  • China's 220 million voter files - The PRC allegedly acquired 220 million U.S. voter files beginning in the 2020 cycle - framed as the largest election-data compromise in history - and assigned a dedicated data exploitation unit to it.
  • Alleged intelligence cover-up - The document claims IC officials ("Deep State") suppressed knowledge of the China compromise from both the President and the public, despite the IC discovering it in 2020 across 18 states.
  • Michigan registration fraud files - FBI documents allegedly show canvassers for a Democrat GOTV operation in Muskegon admitted forging registrations, registering nonexistent people, and receiving gift cards tied to application volume after a 2020 Michigan State Police raid.
  • Enforcement directive - The release asserts the Biden DOJ slow-walked the Michigan case for years; FBI Director Patel is now directed to complete the investigation and pursue prosecutions with DOJ.
  • 278,000 noncitizen registrants - A DHS review of voter rolls and public records allegedly identified ~278,000 noncitizens registered for federal elections, with the White House asserting the true number is higher because Democrat-led states withheld their files.
  • Policy endgame and rolling campaign - The four pillars converge into an argument for Voter ID, proof of citizenship, and curtailing mail ballots, with a mailing list promising "new findings, new filings, and next steps" - signaling a serialized release-and-enforcement campaign rather than a one-time disclosure.

Watch:

The White House has published election integrity findings built around four pillars, accompanying a presidential address and a declassification of Intelligence Community assessments spanning January 2020 through June 2026. The pillars: (1) IC findings that Russia, China, Iran, North Korea, and non-state actors have the capability to compromise U.S. election infrastructure, with centralized data repositories - registration databases, pollbooks, election websites - assessed as most vulnerable; (2) an alleged CIA-reported Maduro-regime plot to digitally rig Venezuela's 2020 elections using methods undetectable "even with an audit," offered as proof-of-concept that electronic vote manipulation is possible; (3) China's alleged acquisition of 220 million U.S. voter files beginning in 2020 - framed as history's largest election-data compromise, complete with a dedicated exploitation unit - which the document claims "Deep State" intelligence officials concealed from both the President and the public; and (4) FBI files on a 2020 Muskegon, Michigan raid of a Democrat GOTV operation where canvassers allegedly admitted forging registrations for pay, a case the Biden DOJ purportedly slow-walked and which FBI Director Patel is now directed to investigate and prosecute. A DHS review claiming roughly 278,000 noncitizens on federal voter rolls rounds out the disclosures.

The findings describe foreign-held voter data, hackable machines, buried fraud evidence, and noncitizen (and "dead people") registrations against a system with no voter ID, no proof of citizenship, and mass mail balloting - while a mailing list promising "new findings, new filings, and next steps" signals a serialized campaign with litigation or enforcement actions queued behind the document drops. 

Update: According to the NY Post's Caitlin Doornbos, Trump is expected to reveal at least 278,000 noncitizens who are registered to vote in US federal elections - a figure arrived at by the Department of Homeland Security in an upcoming report. 

* * *

President Donald Trump is expected to use a prime-time address Thursday night to discuss election integrity and potentially unveil 'four sets' of newly declassified intelligence concerning alleged foreign interference in recent U.S. elections, according to reports.

MSNBC; Getty Images

Trump is scheduled to address the nation at 9 p.m. ET tonight - only revealing that it would focus on election security and related concerns.

"Our country has to shape up," Trump said during an Oval Office appearance with Iraqi Prime Minister Ali al-Zaid. "Without free and fair elections, you don't have a country."

Journalist Paul Sperry reported on X that the address could include allegations that U.S. intelligence and law-enforcement agencies recently uncovered evidence of foreign interference involving China - not Russia - in recent elections, including the 2020 presidential contest.

Citing an unnamed administration source who had reportedly reviewed a draft of Trump's speech, Sperry claimed the evidence includes allegations that Chinese actors penetrated state voter-registration databases and obtained information concerning tens of thousands of voters.

According to Sperry, officials believe the stolen information may have been intended for use in manufacturing fraudulent mail-in ballots supporting Joe Biden. He also claimed that CIA Director John Ratcliffe and FBI Director Kash Patel would appear with Trump or otherwise certify the evidence presented by the administration.

Flashback: Chuck Grassley reveals records showing the FBI spiked a Chinese election interference probe

The documents were reportedly drawn from previously undisclosed or suppressed FBI, CIA, and ODNI records. Sperry's source alleged that the intelligence had been buried as part of a broader effort to conceal Beijing's cyber capabilities and influence operations.

The "really big news" President Trump plans to announce in Thursday's primetime address, according to an administration source who's read a draft of his speech, includes bombshell evidence China interfered in the 2020 election to help Joe Biden win, including hacking into state voter registration databases and stealing information on tens of thousands of voters ostensibly to manufacture mail-in ballots for Biden.

The evidence, which details "alarming vulnerabilities" of election infrastructure, is based on four (4) sets of declassified documents (set for release Friday) which were recently unearthed from suppressed FBI, CIA and ODNI records, according to the well-placed source. The intelligence had been buried in a "massive cover-up" of Beijing's hacking capabilities and influence operations aimed at supporting Biden.

Other vulnerabilities compromising the U.S. election system, according to a draft of the president's speech, include the existence of more than 100,000 non-citizens, including illegal immigrants, on voter rolls. -Paul Sperry

The source characterized the alleged penetration of the 2020 election system as more extensive than the Russian interference described by U.S. officials following the 2016 election.

The expected disclosures reportedly concern vulnerabilities in state election infrastructure, including voter-registration databases, identity verification, mail-in voting, and ballot security.

//--> //--> //--> Will Trump accuse China of election interference by July 16?
Yes 40% · No 61%
View full market & trade on Polymarket

Sperry also reported that a draft of Trump's address references more than 100,000 noncitizens - including people living in the country illegally - appearing on voter rolls. It was not immediately clear which states or databases were included in that figure, how the administration calculated it, or whether all the registrations were active.

Administration Expands Election Integrity Campaign

The address comes as the Trump administration and congressional Republicans intensify their efforts to change federal election policy before the midterms.

Earlier in July, Trump fired members of the bipartisan Election Assistance Commission, the federal agency that assists state and local election officials and oversees the certification of voting systems. The administration has also pursued the creation of a nationwide database of eligible voters and expanded citizenship-verification efforts. Several of those initiatives have encountered resistance in federal court. On June 25, a federal district judge in Massachusetts sided with states challenging the administration's voter-list initiative, ruling that the Constitution leaves states with significant authority over elections. Meanwhile, a federal judge in Washington blocked an updated citizenship-verification database the following day, finding that the program conflicted with federal privacy and Social Security laws.

Then on July 7, a federal judge in Georgia quashed Justice Department subpoenas seeking information about election workers involved in Fulton County's administration of the 2020 election.

Harmeet Dhillon, who leads the Justice Department's Civil Rights Division, has also sent letters to election officials in all 50 states and the District of Columbia. The letters warned that officials could face criminal liability if they knowingly allow ineligible noncitizens to remain on voter rolls.

Democrats, Of Course, Freak Out

Democratic lawmakers are of course in full-on panic mode over the 2020 claims, suggesting that Trump could use the address to revive disputed allegations about the 2020 election or justify new federal intervention in the midterm election process.

Sen. Mark Warner of Virginia, the ranking Democrat on the Senate Intelligence Committee, questioned whether the administration could possess significant new intelligence that had not previously been provided to congressional overseers. Warner told the Epoch Times; "having been deeply involved with the intelligence community for the last decade plus, I would be shocked if there was some major new piece of intelligence that never was shared." He also warned against using questionable or selectively presented intelligence as the basis for government action affecting elections.

Senate Minority Leader Chuck Schumer of New York said Democrats were preparing for several possible scenarios involving the address and the administration's next steps.

Sperry separately reported that the White House had encountered resistance from the three major broadcast television networks over requests to carry the address live. He attributed the hesitation to concerns that the speech might repeat claims that the 2020 election was stolen.

The networks' plans and the White House's reported discussions with them had not been publicly confirmed.

Trump has described the forthcoming announcement as "really big news." Whether the address produces verifiable new evidence - or intensifies the existing partisan conflict over election administration - will likely depend on the contents, sourcing, and independent authentication of any documents released by the government.

SAVE America Act Remains Stalled

Trump has repeatedly called on Congress to approve the Republican-backed SAVE America Act, which would require documentary proof of citizenship when registering to vote and photo identification when casting a ballot.

The legislation passed the House but has stalled in the Senate, where most bills need 60 votes to overcome a filibuster. Republican leaders have considered incorporating similar provisions into a third budget-reconciliation package. The reconciliation process would allow legislation to pass the Senate with a simple majority, although provisions must comply with rules requiring them to have a direct effect on federal spending or revenue.

The Senate parliamentarian previously determined that certain SAVE America provisions did not comply with those restrictions. House Republicans released a $95 billion framework for the reconciliation package on July 15. The proposal could include federal funding to help states establish voter-identification requirements.

The House Budget Committee scheduled a markup of the legislation for July 16. Committee Chairman Jodey Arrington of Texas said the package would help protect the integrity of U.S. elections.

Tyler Durden Fri, 07/17/2026 - 08:44

Renter Nation Returns? Massive Jump In Multi-Family Unit Starts Despite Builder Sentiment Slump

Renter Nation Returns? Massive Jump In Multi-Family Unit Starts Despite Builder Sentiment Slump

US Housing Starts exploded higher by 19% MoM in June, dramatically more than the already large 11.2% MoM expectation and rebounding from the prior two ugly monthly declines.

This was the biggest monthly increase in Starts since May 2023.

On the other side, the more forward-looking Building Permits declined for a second straight month...

This shouldn't be a total surprise after yesterday's decline in builder sentiment (confidence among US homebuilders dropped for a second month to the lowest level of the year, dragged lower by elevated borrowing costs and higher material and land prices).

The surge in Starts was dominated by a massive rebound in multi-family units.

  • Single-family down 0.2% to 895K

  • Multi-family (rentals) soar 76.3% to 513K from 293K, fully reversing the May drop from 494K to 291K

We can't help but question WTF happened in the May multi-family starts data...

Permits were down among both cohorts:

  • single family down 2.4% to 871K SAAR, lowest since August '25

  • multi-family down to 4.9% to 445K SAAR, lowest since March '26

Additionally, Building Permits are tracking rate-hike expectations (inverted)...

Multi-family Starts are back above Permits (perhaps signaling the short-term peak)...

It seems recent rises in the mortgage rate (and inventories already at over-stuffed levels, given the slowness of sales) has finally dented the homebuilders' self-satisfying confidence... and the lack of affordability leaves the American Dream fading into Renter Nation...

Tyler Durden Fri, 07/17/2026 - 08:43

Futures Tumble As Latest Chinese "DeepSeek Moment" Sparks Chip Meltdown

Futures Tumble As Latest Chinese "DeepSeek Moment" Sparks Chip Meltdown

A surprise breakthrough from Chinese AI startup Moonshot (which is now at the top of the Frontend code benchmark on Arena) rumbled through global markets, sending chip stocks reeling, as queasiness returned about the industry’s unprecedented spending spree (something we have been warning about for the past year). Moonshot claims its new Kimi K3 model rivals top offerings from OpenAI and Anthropic in a release reminiscent of last year’s “DeepSeek moment.” It came as President Xi Jinping appeared at China’s premier AI summit, underscoring how rapidly the nation’s AI developers are closing the gap with US rivals (discussed here a month ago). Meanwhile, delays by Alphabet to the launch of the latest Gemini model has also dented tech sentiment. As a result as of 8:00am ET, S&P futures are 0.8% lower with Nasdaq futs tumbling 1.7%; pre-market, Mag 7 are all lower with NVDA (-2.8%), AMZN (-2.1%), and META (-1.8%) among the most notable decliners. AI and Semis concerns continued to dominate the market narrative overnight ahead of Mag 7 earnings next week. What is different from the past few weeks of momentum selloff is that both Mag 7 and Semis were being sold overnight and yesterday, pointing to "concerns over hyperscalers’ AI CapEx and the sustainability of the AI rally" according to JPM. Moonshot’s AI model release also led to further concerns in China AI model competition and questions on AI CapEx (“DeepSeek 2.0” concerns): overnight, Asia AI baskets and China AI baskets (which include Moonshot’s competitors Z.AI and MiniMax) fell 5-8%. Bond yields are lower across the curve: 2y and 10y are 2.1bp and 2.8bp lower, respectively. Oil added another 1.8%; WTI now at $80.47 this morning after Kuwait said power and water plants were attacked by Iran as hostilities in the Gulf escalate with every passing day. Both base and precious metals are higher this morning. US economic data calendar includes June import/export price index, and June housing starts (8:30am), June industrial production (9:15am) and July preliminary University of Michigan sentiment (10am). 

In premarket trading, Mag 7 stocks are all lower (Nvidia -2.4%, Amazon -1.4%, Microsoft -1.9%, Tesla -1.7%, Alphabet -1.5%, Meta Platforms -1.5%, Apple -0.1%). Chipmakers and other AI-related firms are set to extend their selloff amid a broad unwind of the tech trade. Marvell Technology (MRVL) -2%, Qualcomm -2%.

  • Autoliv (ALV) falls 5% after the airbag and seatbelt maker reported second-quarter adjusted earnings per share that narrowly missed consensus estimates.
  • Intuitive Surgical (ISRG) tumbles 10% after the robotic-surgery company maintained its forecast for Worldwide da Vinci robotic procedure growth for the full year, even as its second-quarter results came in ahead of the average analyst estimates.
  • Netflix (NFLX) falls 10% after the streaming giant forecast a second consecutive quarter of slowing sales growth. Analysts note that the tepid current quarter forecast is overshadowing an otherwise in-line quarter.
  • Staar Surgical (STAA) drops 8% after the maker of implantable lenses posted preliminary second quarter results where sales in Europe, theMiddle East and Africa declined by a low single-digit percentage, reflecting ongoing turmoil in the Middle East.

In other corporate news SpaceX aborted Thursday’s Starship rocket mission when some of its engines didn’t fire up, it's stock tumbled another 3% to $125, the lowest since its IPO less than two months ago. US regulators traced a parasite outbreak that’s sickened thousands in Michigan and nearby states to shredded iceberg lettuce served at Taco Bell restaurants, identifying a single supplier as the apparent source.

Tech is once again dragging futures lower in early trading as questions over momentum, semiconductor capex and hyperscaler debt persist, masking a powerful rotation beneath the surface. Traders rushed to exit positions in stocks that had fueled this year’s rally, sending the Nasdaq tumbling. The S&P 500 Equal Weight Index posted an all-time high in Thursday’s cash session and the VIX remains below the key psychological level of 20, but the S&P 500 is down on the week and set to deepen those losses on Friday.

Stock investors are taking profits on crowded positions in chip-related stocks, with a key gauge of industry giants still up 68% this year. For Francisco Simon, European head of strategy at Santander Asset Management, the selloff still looks moderate in comparison to the preceding rally. “We would distinguish between fundamentals and positioning,” he said. “From a fundamental perspective, the picture remains solid: earnings momentum has been exceptional this year, and results are still coming in strongly.”

Beata Manthey, head of European and global equity strategy at Citigroup, says sharp stock rotations are necessary for the equity rally to broaden beyond the tech sector. “The market has started to hope for some long-awaited broadening,” Manthey told Bloomberg Television. “For that to happen, you need to have some rotations, and rotations tend to happen in quite a violent way sometimes — and this is what we’re seeing right now.”

Also in tech, the marquee listing of CXMT ignited a rush among retail investors as China’s homegrown memory giant opened books for an IPO to raise $9.8 billion, the second-largest in the nation’s history. The retail portion of the IPO was 212 times oversubscribed. President Xi hailed China’s progress in developing low-cost AI in his debut at the World AI Conference in Shanghai on Friday. The rise of China’s AI models shaping the technology’s global rules is stirring security alarms in Washington and Beijing alike.Elsewhere, Japanese memory chipmaker Kioxia’s market capitalization has now halved in just a month since becoming the nation’s most valuable company. 

“When there’s panic, no one wants to be the last one in a selloff, so the selling pressure increases,” said Guillermo Hernández Sampere, head of trading at MPPM. “With the start of reporting, the suspicion of overvaluation has been confirmed and will continue for a bit.”

In short, chipmakers and other AI-related firms are set to extend their selloff amid a broad unwind of the tech trade. Meanwhile Netflix, already more than 40% lower in the past year, is also weighing on tech sentiment. The streaming giant fell 10% in premarket trade Friday after forecasting a second consecutive quarter of slowing sales growth, fanning fears for its future.

Cash would offer good protection in the near term, Simon at Santander Asset Management said. Bonds are a less attractive option as higher oil prices could undermine the defensive characteristics of sovereign debt. “The key reassurance would probably come from the earnings season,” he said. “If companies continue to deliver solid results, and valuations become more attractive after the correction, that could help bring longer-term buyers back.”

Another day of attacks and counterstrikes in the Middle East also weighed on sentiment. Concerns are growing that the US and Iran will intensify hostilities, making oil tanker operators wary of transiting the Strait of Hormuz.  

In geopolitics, Trump accused China of interfering with US elections in 2020, claiming the Chinese government stole voter files, including names, addresses and other sensitive data. The US administration said it would shorten the duration of visas for foreign journalists - raising concern about a new round of tit-for-tat restrictions with China.

Meanwhile, the Fed’s Vice Chair Philip Jefferson suggested the central bank should consider raising interest rates if inflation doesn’t cool soon. 

Selling by US corporate insiders raised another red flag about investor caution. Executives sold $77.6 billion of stock during the first half, according to EPFR Global Market Intelligence, the second-highest amount in more than 20 years a classic red flag to some investors because it suggests people with the most corporate knowledge are wary about markets.

European equities edged lower on Friday. with technology and mining shares leading declines, while utilities and telecommunications stocks outperform. Tech subindex of the Stoxx 600 down to the lowest since May. Here are the biggest movers on Friday:

  • Tomra gains as much as 16% after the recycling equipment firm’s 2Q report beat expectations and the firm announced a contract to supply 1,200 recycling machines with a large UK retailer
  • EQT rises as much as 13% after the investment firm’s first-half earnings beat estimates, providing some relief to a stock that had fallen more than 20% year-to-date through Thursday
  • Getinge shares jump as much as 10% after the Swedish health-care equipment firm reported second-quarter sales and earnings which JPMorgan says were better than expected
  • Assa Abloy gains as much as 6.2%, the most in a year, after the Swedish lock and entrance systems maker reported its latest earnings
  • European semiconductor stocks decline across the board on Friday. AI trades that were popular in the first half lose ground amid concerns over the sustainability of AI spending
  • Lagercrantz shares plunge as much as 16%, its biggest drop since 2022. The industrial conglomerate posted quarterly margins and earnings that missed expectations, according to DNB Carnegie
  • AAK sinks as much as 12% after the Swedish maker of vegetable oils and fats saw a softer second quarter, impacted by lower volumes, price pressure in Food Ingredients and production-related challenges at its Karlshamn site
  • DKSH shares fall as much as 8.3%, the most since September, after the Swiss conglomerate reported operating profit for the first half-year that missed the average analyst estimate
  • Burberry shares fall as much as 7.3% after the UK luxury brand posted first-quarter results that were weaker than expected in Europe and Asia
  • Valterra Platinum slipped as much as 2.4% after the miner reported 2Q earnings and 1H guidance. Analysts note that 2Q own mined volumes missed, while PGM refined production was in line

Asian stocks slipped the most in three weeks despite robust earnings from Taiwan Semiconductor Manufacturing Co., highlighting how elevated expectations have become for AI-related companies. The MSCI Asia Pacific Index dropped 2.8% and is headed for a second straight weekly decline. TSMC fell more than 7%, triggering a correction in Taiwan’s Taiex. The Nikkei 225 slid 4% as Japanese chip-related stocks such as Kioxia Holdings Corp. and Tokyo Electron Ltd. came under pressure. Hong Kong and mainland China also declined, while South Korea’s markets were mercifully closed for a holiday, even though the KORU 3x levered korea ETF plunged. TSMC reported a faster-than-anticipated 77% jump in quarterly net income and raised both its revenue and spending projections. The main chipmaker for Nvidia Corp. now expects sales to grow more than 40% this year and plans to spend as much as $64 billion in 2026, reflecting confidence that AI-driven demand for chips and data centers will remain strong. Some markets with lower exposure to AI such as Indonesia, the Philippines and India rose. Malaysia’s benchmark stock index gained 0.5% as the country reported a surprise surge in economic growth in the second quarter. Investors will focus on earnings for companies including CATL and Shin-Etsu Chemical in the week ahead. Other key events include Indonesia’s monetary policy. The Jakarta stock index has climbed for seven straight sessions, the longest streak in about a year. 

In FX, the Bloomberg Dollar Spot Index is up 0.1%, with the Swiss franc outperforming among major currencies while the Aussie dollar and sterling lag. Traders continued to dial down expectations for Federal Reserve interest-rate hikes this year. 

In rates, treasuries hold modest gains despite the rise in oil prices, sending 10-year yields four basis points lower to 4.52% with US stock index futures under pressure from chipmaker shares after surprise breakthrough from Chinese AI startup Moonshot and Alphabet’s delayed launch of latest Gemini model. Limiting gains, oil futures are up more than 2% after Kuwait said power and water plants were attacked by Iran. Treasury yields are 2bp-4bp lower led by 5- to 10-year sectors, flattening 2s10s curve by about 1bp; 10-year near 4.51% outperforms bunds and gilts in the sector by 2bp and 1bp respectively. 

In commodities, WTI crude oil futures are up 2.6% near session highs, heading for biggest weekly gain since April as the escalating conflict between the US and Iran disrupts Middle East supply. IG dollar issuance slate empty so far, though Bank of America, Citigroup and Wells Fargo are expected to tap the market as soon as Friday; weekly volume is near $47 billion. Gold moving higher but short of $4,000/oz.

US economic data calendar includes June import/export price index, and June housing starts (8:30am), June industrial production (9:15am) and July preliminary University of Michigan sentiment (10am). Fed calendar is blank; external communications blackout period commences Saturday ahead of the July 29 policy decision

Market Snapshot

Top Overnight News

  • US President Trump announced the immediate declassification of intelligence on elections during his primetime address and noted that China engaged in election-related activities in 2020 and did not want him to win the election, while he claimed that China attempted to manufacture ballots for Biden and worked to influence businesses against him. China's Foreign Ministry denied these accusations.
  • China’s Moonshot AI has launched an artificial-intelligence model, Kimi K3, it says outperforms some cutting-edge U.S. systems, the latest sign that Chinese labs can rival American counterparts like OpenAI and Anthropic in critical technology frontiers. WSJ
  • The U.S. struck multiple bridges in Iran on Thursday to cut off supply routes to a port city and naval base in the Strait of Hormuz that Iran uses to attack ships and project power, according to a senior U.S. official. Several attacks on bridges were reported in and around the port city of Bandar Abbas overnight Thursday, and highways connecting Bandar Abbas to nearby provinces were declared closed, according to Iran’s state broadcaster IRIB. WSJ
  • Two US-sanctioned tankers carrying cooking fuel are U-turning and navigating in the Gulf of Oman and Arabian Sea as the US steps up enforcement of its blockade on Iranian shipping. A third sanctioned LPG vessel is indicating China as its destination. BBG
  • Japanese PM Sanae Takaichi called for households and the GPIF to increase investment in domestic financial assets, fueling expectations of possible allocation changes at the fund. Finance Minister Satsuki Katayama reiterated her willingness to take “decisive action” in currency markets. BBG
  • Xi Jinping called for inclusive cooperation on AI development and urged the world to avoid technological rivalries at China’s top tech summit. BBG 
  • The ECB will probably pause to assess inflation next week before delivering a final rate hike in September. BBG
  • New York City air quality remains at “unhealthy” levels today as the EPA warned people to spend more time indoors, with wildfire smoke blanketing much of the East Coast. Several communities across northern Ontario have initiated evacuation to avoid the blaze. BBG
  • BP and ConocoPhillips are set to announce billions of dollars of new investments in Iraq on Friday as Washington seeks to bolster the country’s energy sector and reduce the region’s reliance on routes vulnerable to Iranian disruption, according to people familiar with the plans. CNBC
  • A top executive at Amazon’s cloud division plans to join Meta Platforms in the coming weeks, a sign of the social-media giant’s growing ambitions in developing data centers and computing resources. Dave Brown, one of the most senior executives at Amazon Web Services, will bring his nearly two decades of experience to Meta, where he will report to the company’s head of infrastructure and focus on the firm’s data center build-out. WSJ 
  • US President Trump called on Congress to pass the Save America Act in light of recent revelations.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks were pressured as the tech selling rolled over from Wall St and with sentiment weighed on by US-Iran escalation, in which the US conducted a sixth consecutive night of strikes on Iran and targeted infrastructure, including an airport, railway station and several bridges. ASX 200 was dragged lower by weakness in mining, materials, resources and tech, while telecoms, energy and defensives were at the other end of the spectrum, helping cushion the downside. Nikkei 225 underperformed and took the brunt of the semiconductor sell-off in the absence of its South Korean counterpart due to Constitution Day, while Kioxia was heavily pressured and has shed 50% of its market cap from last month's peak. Hang Seng and Shanghai Comp conformed to the downbeat mood amid the tech-related woes, and with sentiment also not helped by US President Trump's primetime address, in which he accused China of meddling in the 2024 US Election and called for Congress to pass the SAVE America Act.

Top Asian News

  • Japanese PM Takaichi said the government will pursue steps that encourage investment in Japanese financial assets, including by households and pension funds like the GPIF.
  • Chinese President Xi said that the world has entered an unprecedented period of AI innovation, adding they should seize rare historic opportunities to encourage open source AI.
  • China FX regulator said foreign investments into China saw net inflows in H1 and outbound investments continue to grow steadily.

European bourses (STOXX 600 -0.7%) are broadly lower, following on from the weakness in Asia (Nikkei -4%, Hang Seng -2.1%), with clear underperformance seen in the AEX (-1.0%) and FTSE MIB (-0.8%). Tech (ASML -4.2%, STMicroelectronics -6.9%) is the clear underperformer following the sharp selloff overnight in APAC names, as worries of stretched valuations persist. Despite the selloff, this week has been broadly positive in the tech space, with both TSMC and ASML reporting strong Q2 figures that beat estimates. Today's weakness just shows that, despite positive news, concerns over the AI capex and its current momentum persist. In terms of the broader sector space, the bias is mixed. Utilities (+1.5%) top the sector pile, followed by Food, Beverages & Tobacco (+0.9%) and Telecoms (+1.1%). Outside of Tech (-2.9%), Basic Resources (-2.1%) and Banks (-1.2%) are the sector laggards. US equity futures are lower across the board, with underperformance in the NQ (-1.9%), given the tech weakness overnight. After-hours, Netflix (-9% pre-market) reported Q2 earnings that came broadly in-line with expectations, but investors were left disappointed by its earnings forecast, with Q3 EPS and Revenue guidance missing estimates. For SpaceX (-3.5% pre-market) , shares fell below its IPO price of USD 135 for the first time on Thursday after the launch of Flight 13 was aborted.

Top European News

  • EU Inflation Rate YoY Final (Jun) Y/Y 2.8% vs. Exp. 2.8% (Prev. 3.2%, Low. 2.8%, High. 2.9%).
  • EU Inflation Rate MoM Final (Jun) M/M -0.1% vs. Exp. -0.1% (Prev. 0.1%, Low. -0.1%, High. -0.1%).
  • EU Core Inflation Rate YoY Final (Jun) Y/Y 2.4% vs. Exp. 2.4% (Prev. 2.6%).

FX

  • G10s are mixed against Buck with recent outperformers AUD and GBP underperforming against the Greenback, while Thursday’s CHF underperformance reverses.
  • USD is modestly firmer today as it gains some haven demand as stocks (NQ -1.9%) slip as tech weakness remains a theme. A couple of factors are driving today, but to summarise, Nikkei 225 was the target for selling amid the KOSPI closure overnight (due to domestic holiday), which saw stocks take a stronger negative lead from APAC and help the Buck. Aside from this, macro newsflow is light with crude a touch firmer as US and Iran continue to exchange strikes for the sixth day.
  • GBP, which is set for a fourth week of gains, pulls back a touch from the 1.35 level as participants await the coronation of incoming PM Burnham. EUR/GBP also saw Sterling outperform for its fourth week, but like Cable, off recent lows as it reclaims 0.85. There remains a level of uncertainty around the incoming PM, with none of his cabinet officials confirmed as of yet, and many policies still unknown. ING expects a return to 0.870 in EUR/GBP by late summer.
  • JPY is flat against the Buck despite c. 30pips of downside seen this morning. Japanese PM Takaichi said the govt. would pursue steps that encourage investment in Japanese financial assets, including by households and pension funds like the GPIF. To remind, last week FinMin Katayama said she would pursue steps to promote investment in Japanese assets by GPIF and others. There was some scepticism around this remark as it would be a textbook tactic to encourage domestic investment and passively limit outflows - Katayama is not in a position to direct changes, it would be under the jurisdiction of the Labour Ministry. We await further updates with a timeline around any potential GPIF changes, for now, JPY flat against the Buck near 162.50 despite earlier gains.

Fixed Income

  • Fixed income benchmarks are firmer across the board, despite a clear driver; however, debt could be finding some haven flows as equities print deep selloffs globally.
  • Gilts (+26 ticks) outperform, with Andy Burnham to begin his Labour premiership on Monday. Focus will be on who Burnham chooses as Chancellor (widely expected to be Home Secretary Mahmood) and what his plans are for the government. Reporting by Bloomberg stated that he has asked the civil service to prepare plans for new North Sea oil and gas drilling and public control of Thames Water. Regarding the Chancellor position, Mahmood is likely to be named Chancellor, but this has already drawn some backlash. Rachel Maskell told the Times that appointing Mahmood would be a mistake and that Miliband “shines well above Shabana.” Despite this, gilts trade at the top end of its 87.15-87.59 range.
  • JGBs (+36 ticks) have steadily bid higher in early European trade, after Japanese PM Takaichi said the government will pursue steps that encourage investment in Japanese financial assets, including by households and pension funds. She even specifically named GPIF. Focus on pension fund investments in domestic assets started after FinMin Katayama said she wanted to encourage the GPIF to invest more. Takaichi's more recent comments would likely strengthen the view that the government is keen to have the GPIF consider altering its asset allocations.
  • USTs (+8 ticks) trend higher despite a lack of events on the calendar. Fed's Jefferson gave remarks overnight, stating that it would be appropriate to reconsider the stance in the scenario in which inflation does not start cooling.

Commodities

  • The US continued to strike Iran for a sixth consecutive night. Following this, Iran claimed power facilities, bridges and civilian infrastructure were struck. And in response, Iran launched its own strikes on Gulf neighbours.
  • More pertinently was a severe warning from the Iranian Army Spokesman. He stated that if the US strike the infrastructure of Iran, all infrastructure in the region will be a legitimate target; He added that “either all countries in the region can export oil or no one can”.
  • Other news in the region, the UKMTO received 2 reports. More recently, there was a report 65NM south of Al Mukalia, in which unauthorised personnel boarded the vessel. Sources say armed assailants boarded a chemical products tanker Asana in the Gulf of Aden, which is potentially related.
  • Crude benchmarks spent the overnight session in the green, amidst the aforementioned developments. Brent Sep’26 (+1.7%) holds towards the top end of a USD 83.71-85.88/bbl range.
  • Spot gold (+0.5%) is incrementally firmer this morning, though still remains just shy of the USD 4k/oz mark, after dipping below that mark in the prior session. Recent pressure has been driven by the ongoing inflationary woes surrounding the latest US-Iran escalation. Nonetheless, some analysts remain confident in the structural drivers for the yellow metal, namely, continued central bank purchases. Elsewhere, base metals are broadly in the red this morning – hampered by the risk tone. 3M LME Copper trades within a USD 13,429-13,563/t range.
  • BP (BP/LN) and ConocoPhillips (COP) reportedly set to announce billions of dollars of new investments in Iraq on Friday, CNBC reports; sources said the figure may be in the tens of billions.
  • Chinese LNG importers are exploring ways to reduce reliance on Qatar, Bloomberg reported.
  • China State Planner NDRC to cut retail fuel prices in the current bi-monthly cycle, effective July 18th. To cut gasoline prices by CNY 300/t, and diesel by CNY 290/t.
  • TotalEnergies (TTE FP) cut output at Port Arthur refinery as the reformer is undergoing repairs.

Central Banks

  • Fed's Jefferson (voter) said the current policy stance should support the job market and allow inflation to resume its decline towards 2% as tariff effects and energy prices pass through. Jefferson said in a scenario where inflation does not start cooling, it could be appropriate to reconsider the stance and ensure they deliver price stability, while he added that current policy is well-positioned to respond based on incoming data, the evolving outlook and balance of risks, and he is firmly committed to returning inflation to the 2% target, consistent with the dual mandate.
  • BoJ reportedly sees little need for consecutive rate rises, may reconsider its assessment of economic risks, according to Bloomberg citing sources. It is also likely to raise its growth forecast for this year from its current 0.5%. Officials may revise their downside-risk assessment as AI-related demand supports exports, profits and incomes, while faster cost pass-through keeps underlying inflation risks elevated above the 2% target.

Geopolitics

  • US President Trump said they will see the fruits of labour in Iran shortly.
  • US CENTCOM said forces conducted a new wave of strikes against Iran for the sixth consecutive night to further degrade Iranian military capabilities. The US launched a missile attack on Iranshahr airport, targeted a railway station in Bandar Abbas and struck five bridges in southern Iran. It was also reported that explosions were heard in Ahvaz, Chabahar and Bushehr, with missiles hitting air and naval bases in Bushehr.
  • US CENTCOM announced Marines conducted an inspection aboard M/T Wen Yao in the Gulf of Oman on July 16th, while it was separately reported that only three ships crossed the Strait of Hormuz in the last 24 hours, according to marine traffic data cited by Al Jazeera.
  • Iran targeted US radars in Kuwait with a drone strike, and explosions were reported at the US Navy's Fifth Fleet Naval Base in Bahrain, while blasts were heard at a US airbase in Qatar and in Erbil, Iraq.
  • IRGC claimed to have launched an attack on a US command centre in Syria's Al-Tanf, while it warned no oil or gas will be exported through the Strait of Hormuz as long as US attacks continue.
  • Iran has informed allies, including Hezbollah, that the waiting phase is about to end and ordered them to prepare for military scenarios, according to Kann news citing Lebanese press.
  • Kuwait’s Defence Ministry said Iranian 'aggression' on Thursday targeted a number of vital facilities, resulting in material damage.
  • Iranian armed forces senior spokesperson said they will never allow the US to interfere in the Strait of Hormuz, while he stated that the route Iran has determined in the Strait of Hormuz is safe, and any route outside it will be unsafe and ships will be damaged. The spokesperson also warned that if the US strike the infrastructure of Iran, all infrastructure in the region will be a legitimate target and stated that "Either all countries in the region can export oil or no one can".
  • UKMTO has received a report of an incident 19 nautical miles east of Khasab, Oman. Additionally, the UKMTO received another report of an incident 65NM south of Al Mukalia, Yemen, with the vessel boarded by unauthorised personnel. Following this, maritime sources said armed assailants boarded a chemical products tanker Asana in the Gulf of Aden, off the coast of southern Yemen.
  • Lebanese sources said the US-Israeli-Lebanon meeting would likely be postponed to finalise technical arrangements, Sky News Arabia reported.
  • Islamic Resistance of Iraq put a USD 10mln bounty on US President Trump.
  • Naftogaz said a Russian drone attack suspended operations at a gas production facility in Ukraine’s Kharkiv region.

US Event Calendar

  • 8:30 am: Jun Import Price Index MoM, est. -0.65%, prior 1.9%
  • 8:30 am: Jun Housing Starts, est. 1310k, prior 1177k
  • 8:30 am: Jun P Building Permits, est. 1403k, prior 1410k
  • 9:15 am: Jun Industrial Production MoM, est. 0.2%, prior 0.1%
  • 9:15 am: Jun Capacity Utilization, est. 76.2%, prior 76.2%
  • 10:00 am: Jul P U. of Mich. Sentiment, est. 51, prior 49.5

DB's Jim Reid concludes the overnight wrap

As we go to press this morning, global equities are continuing to slump, as fresh doubts about the AI trade have driven a pronounced selloff in tech stocks. Indeed, the S&P 500 fell -0.51% yesterday, and this morning futures are down another -0.78%. Moreover, there’s no sign of any letup this morning in Asia, with very sharp declines for the Nikkei (-4.81%), the CSI 300 (-2.45%), the Hang Seng (-1.98%) and the Shanghai Comp (-1.64%), whilst the KOSPI is closed for a public holiday. Indeed, that slide indicates the Nikkei is currently likely on course for its worst day since March, and also leaves the index on track for technical correction territory, having now shed over 12% since its peak less than a month ago.

There wasn’t a single catalyst behind the selloff, but we had TSMC’s earnings shortly after we went to press yesterday, and their share price is down -5.26% this morning after they said that capital expenditure would be higher than previously forecast. Meanwhile, Netflix’s earnings disappointed after the close last night, pushing their shares almost -9% lower in after-hours trading. And in the background, fears about rate hikes and more persistent inflation are still there, with Brent crude oil up another +1.06% this morning to $85.12/bbl. That would be its first close above $85/bbl in over a month, and that combination of concerns around tech and inflation has really put a dent in the more buoyant narrative after the soft US CPI report earlier this week.  

Before the slump accelerated overnight, US equities had already seen a rough session yesterday thanks to the fresh slide in chip stocks. In fact, the Philly semiconductor index (-4.29%) hit an 8-week low, having now shed -18.91% from its peak less than a month ago. So that now leaves it close to the -20% mark that would mark a technical start of a bear market, which is a big turnaround from Q2, when it posted its best quarterly performance since the index began in the early 1990s. The AI-related tech pullback wasn’t limited to chipmakers either, with a decline for the Mag-7 (-1.27%) led by a slide in Alphabet’s shares (-4.44%) after Bloomberg reported a months-long delay for its new Gemini 3.5 Pro AI model. So that tech decline dragged on the S&P 500 (-0.51%), which fell even as nearly three-quarters of its constituents advanced on the day.

That positive breadth in the US stock market was supported by the latest batch of US data, which suggested that the economy was still in decent shape. Most notably, the weekly initial jobless claims were down to 208k in the week ending July 11 (vs. 217k expected), which was their lowest in two months. So that reassured investors that the labour market was holding up into Q3. Meanwhile, retail sales grew by +0.2% in June as expected, and there was an upward revision of a tenth to the May figures. So collectively, that added to the picture of ongoing data resilience, and we also saw the Atlanta Fed’s GDPNow estimate for Q2 move up as well, now showing an annualised rate of +1.7% (vs. +1.3% before).

In terms of the latest in the Middle East, oil prices oscillated back and forth through the day, as strikes between the US and Iran continued. But this morning they’re currently slightly higher at $85.12/bbl, which would be their first close above $85/bbl in over a month if sustained. In terms of the latest, the US military said overnight that they’ve completed another wave of strikes on Iran, whilst Iran’s Press TV said they targeted US military sites in Kuwait. Otherwise, there was also a Reuters report yesterday that Iran had asked its Houthi allies in Yemen to be ready to close the Red Sea oil route if the US struck Iran’s power network, which raised fears about further supply-chain disruption.
This backdrop saw the probability of a Fed hike by September inch up from 55% to 57%, whilst the number of hikes priced by December was up +1.1bps on the day to 27bps. In turn, Treasury yields edged higher as well, with the 2yr yield (+0.6bps) up to 4.14%, whilst the 10yr yield (+0.5bps) stood at 4.55%. Those moves came as Fed speakers highlighted the potential for rate hikes. For instance, Dallas Fed President Logan (voter) said that “modestly higher interest rates would better balance the outlook and risks” as the path towards a disinflation scenario was for now “more a hope than a likelihood”. Meanwhile, Kansas City Fed President Schmid (non-voter) cautioned that even though the June inflation data was better than expected, inflation “is too hot and has been above target for too long”.  

Earlier on, European markets had mixed performance before the slump gathered pace later in the US session. On the bright side, the STOXX 600 (+0.16%) posted a third consecutive advance. But there was an uneven picture across the continent, with gains for the UK’s FTSE 100 (+0.54%) and Spain’s IBEX 35 (+0.15%), alongside losses for the German DAX (-0.34%) and France’s CAC 40 (-0.05%). For sovereign bonds, there were more consistent losses, with 10yr bund yields (+1.3bps) up to 3.13%, whilst 10yr OAT yields (+1.7bps) hit a post-2009 high of 3.93%. European bonds weren’t helped by a continued rise in European natural gas prices, with futures up another +0.79% to a 3-month high of €54.79/MWh.

Here in the UK, data showed GDP grew by a monthly +0.1% in May (vs. unch expected). So gilts underperformed following the data, with the 10yr yield (+2.8bps) rising as investors dialled up the chance of Bank of England rate hikes this year. Meanwhile, Andy Burnham is set to become leader of the governing Labour Party today, having been the only candidate nominated in the contest. He’s then set to become Prime Minister on Monday, after incumbent PM Keir Starmer formally resigns.

Finally, yesterday saw a notable milestone for gold (-2.07%), which fell back below $4,000 to close at its lowest level of 2026 so far at $3,976/oz. That’s a far cry from how it began the year, as January saw gold’s best monthly performance since 1999. But it’s now down over -7% since the year began, and over -25% from its late-January peak.  

Looking at the day ahead, US data releases include industrial production, capacity utilization, housing starts and building permits for June, along with the University of Michigan’s preliminary consumer sentiment index for July. In the Euro Area, there’s also the final CPI print for June. Otherwise, central bank speakers include Fed Vice Chair Jefferson and the ECB’s Cipollone.

Tyler Durden Fri, 07/17/2026 - 08:35

Live Cattle Futures Tumble To Seven-Month Low, But Bernstein Says Beef Prices Will Stay Elevated

Live Cattle Futures Tumble To Seven-Month Low, But Bernstein Says Beef Prices Will Stay Elevated

Despite our view that beef prices will remain elevated this year amid the smallest US cattle herd size in more than 60 years and mounting concerns over New World screwworm detections in Texas, live cattle futures in Chicago have tumbled this month as speculative traders unwind bullish bets.

Chicago live cattle futures have dropped to their lowest point since December 2025, as speculative traders liquidate positions amid weakening cash trade and falling wholesale beef prices.

The commodities firm CIH Cattle Team pointed out on X that both speculative and commercial traders are reducing their long exposure: "Live Cattle OI in a major downtrend! Down 11k over the past month and 83k contracts year-over-year; OI lowest since 2022 for July."

Analysts from Hightower Report noted that the "market is vulnerable to further losses" as the physical trade slows and funds continue to liquidate positions, adding that a strong cash trade had been driving the long bull market, but cash is now a liability.

Chris Lehner, a senior livestock analyst at ADM Investor Services, was quoted by Bloomberg as saying that the decline in cattle prices was mostly driven by spreads, with traders selling cattle positions and buying lean hog futures.

"Consumer beef demand has been strong, but indications of growing consumer headwinds could weigh on the sector going forward," University of Georgia Assistant Professor Will Secor wrote in a note for the Livestock Marketing Information Center.

Recent USDA data show that wholesale beef values have fallen to their lowest levels since late February. The national average retail price for ground beef remains sticky around $7 per pound.

Analysts at Bernstein spoke with industry experts this week and concluded that beef prices are likely to remain high for several reasons:

We left the conversation with greater conviction that beef prices will remain elevated for a while.

The experts emphasized how the current state of herd size, which has reached a 60-year low, is unlikely to expand given that (1) land has become more expensive and is being used by developers (due to population migration into Texas), making it hard for farmers to raise more cattle, (2) farmers are opting to sell heifers (given the current high spot prices) rather than raising them, as they fear that prices will eventually fall, making it economically sub-optimal to wait 2 years to increase the herd size through the eventual calves of that heifer. (3) recreational use of land has also become more profitable, with a buck sold at "30k a kill" vs "$500 per cattle".

Important to understand: When Will The Cattle Cycle Turn? BofA Has Answers For Beef Lovers

Tyler Durden Fri, 07/17/2026 - 07:45

Private Credit: The New Junk Bond Market

Private Credit: The New Junk Bond Market

Authored by Ed Dowd via Beyond the Narrative,

Private Credit: The New Junk Bond Market...Except It Lacks Transparency, Liquidity & Is About To Be Stress Tested

History

Private credit was born from the ashes of the Great Financial Crisis. In the aftermath of that debacle, regulators moved to limit the risks banks could take. Loans deemed too risky were no longer being originated by commercial banks. To fill that void, non-bank lenders stepped in, creating what is known as private debt or direct lending market. You may know these vehicles as Private credit funds, also referred to as business development companies (BDCs). These funds raised capital from pensions, endowments, insurance companies, and wealthy individuals.

Unlike junk bonds or corporate bonds, these loans are not publicly traded and are typically held to maturity. In fact Private credit has quietly taken a big chunk of market share from the traditional junk bond market. These private deals give borrowers speed, confidentiality, and customized terms they can't always get from public bonds, while investors get higher yields and perceived lower volatility. The public junk bond market has actually improved in average credit quality as the riskier companies moved into these opaque structures.

The funds have traditionally targeted middle-market companies with revenues between $10 million and $1 billion, though the strategy has recently expanded to larger firms and bigger deals, including those in AI. Last November Morgan Stanley estimated that of the $1.5 trillion in external financing needs for the projected AI datacenter buildout that as much as 50% could be funded by Private credit (hold that thought).

One notable drawback of private credit funds is their high degree of opacity also called a lack of transparency. These funds disclose limited information about their loans and mark their own books, which can potentially mask deterioration in the portfolio. Because of the illiquid nature of these assets and the lack of a public trading market, the investments are inherently illiquid and often include gating provisions should too many investors want their money back at the same time.

Growth

The industry started the way any small new industry does: by filling a niche need. The fee structure, while lower than that of private equity, remained extremely attractive to managers, with total effective fees often running from 3% to 4% of NAV. The pitch to investors was straightforward: higher yields than public bonds and lower reported volatility because there is no daily mark-to-market. The risks, of course, are illiquidity and higher default rates in a recession (hold that thought).

Bottom line: The fat fee structure attracted many firms to get into this business and the Wall Street sales machine was engaged, went into action and the money flowed into these firms.

The Last Two Years of Growth

The industry itself is not nefarious, but like all credit markets, it is prone to excesses at the end of a cycle. Growth in assets under management (AUM) over the last two years (2024 & 2025) has been estimated at 50% to 75%. The entire category is now estimated to stand between $2.5 trillion and $3 trillion in AUM. When you examine credit creation across the broader banking system over that same period, most of the incremental loan growth in the economy flowed to these non-bank institutions from commercial banks (See chart below).

Source: Phinance Technologies US Economy Outlook 2026

The key question investors should ask is: With this explosive growth in AUM and competition for loans in the industry, have the funds found enough creditworthy borrowers in an already high-risk category, or rather did the inflows chase incrementally "junkier" credits with looser loan covenants?

Trouble in Paradise

Starting in the fourth quarter of last year, several high-profile Private credit bankruptcies emerged, most notably First Brands and Tri-Color Auto. Questions about the structure of Private credit funds began to surface, particularly around opacity and illiquidity. This led to investor redemptions and the gating of several prominent funds in Q1, including those from BlackRock, Blackstone, Apollo, Cliffwater, Blue Owl, and others. The pressure continued into Q2, with redemption requests accelerating across these major platforms. The problem is not improving, rather it is getting worse.

Implications

Effectively, the Private credit markets are now shut down and at best stalled. They are in redemption mode which could ultimately lead to liquidation mode at subpar pricing. While some new loans may still be originated, the market as a whole has slowed dramatically. As noted previously, we saw that the marginal credit creation of the past two years in the US economy has come from an industry known for being opaque and illiquid...and that driver of credit is now in question. The critical questions are: how large are the losses, how long will this downturn in private credit last, and what will recovery rates look like? PIMCO (one of the largest fixed income investors) has recently stated that the credit default cycle has begun and that losses will be higher than expected, with clear implications for the broader economy.

To make matters worse the lack of transparency and public quotes make determining what is going on in these funds extremely difficult for the capital markets to assess other than the fact that we are seeing outflows from the sector. The investors have unanswered questions and are like mushrooms growing in the dark on manure.

Private credit woes may also have implications for the commercial banking system. I mentioned above that most of the credit creation from commercial banks in 2024 & 2025 was Private credit and Private equity. Private credit funds rely on bank credit lines (subscription lines, NAV facilities, revolvers) for liquidity and leverage. These have grown rapidly with contingent liquidity to Non-Depositary Financial Institutions (NDFIs) standing at approximately $2.3 trillion overall, with Private credit market share rising over the last few years. Simultaneous drawdowns from credit stress in Private credit could transmit shocks to bank balance sheets. I don't believe it's a systemic problem yet but it bears watching. At a minimum it would likely curtail commercial bank enthusiasm for overall credit creation in the economy (i.e. consumer loans, commercial & industrial loans and real estate loans).

Earlier I told you to hold two thoughts in your head. First that AI funding datacenter buildout was contingent on the Private credit market to fund 50% of the external financing, and secondly, the default rates in Private credit would be higher in a recession as advertised initially by the industry. Given that flows in the Private credit industry are going the wrong way, and the industry is effectively paused...I don't see how AI data center build out will be funded by Private credit in the near term, and secondly I believe the industry's recession default assumptions are about to be tested very soon and could be higher than expectations.

Conclusion

Credit is the lifeblood of economic activity, and recently a great deal of it has flowed through this new channel. Significant losses have yet to be fully recognized, and they will ultimately hit pension funds, insurers, asset managers, and wealthy individuals who hold these investments. The commercial banks also have exposure to this market and losses in this sector could lead to a broader credit contraction. And finally, AI financing could become prohibitively expensive and pause or dramatically slow the capital expenditure cycle, affecting what has now become about 45% of the S&P 500's market capitalization.

I believe the feedback loops are already underway and are likely to spread to the economy and eventually the equity markets.

P.S. If you are interested in a much deeper nitty gritty dive into Private credit markets and the risks check out the Unicus Investor on Substack: The Unicus Investor - Blackstone's BCRED: Earned $0.54. Paid $0.60. Cut to $0.54.

Disclosure: I have no financial relationship with Unicus...I just think they do good work.

"Be careful that you do not forget the Lord your God... Otherwise, when you eat and are satisfied, when you build fine houses and settle in them, and when your herds and flocks grow large and your silver and gold increase and all you have is multiplied, then your heart will become proud and you will forget the Lord your God..." Deuteronomy 8:11-14

Tyler Durden Fri, 07/17/2026 - 07:20

Bromance Breaks Out Between "Man of Peace" Trump And Azerbaijani President

Bromance Breaks Out Between "Man of Peace" Trump And Azerbaijani President

Azerbaijani President Ilham Aliyev lavished praise on President Donald Trump's diplomacy, telling a group of journalists at the 4th Shusha Global Media Forum that the president achieved peace between Azerbaijan and Armenia in mere months, a historic feat that both Democrat and Republican administrations had failed to accomplish over nearly 30 years.

White House Photo by Daniel Torok

When asked by Breitbart News reporter Joshua Klein what distinguished Trump's approach, Aliyev said the difference was one of mindset for the willingness to treat an entrenched conflict as something to be settled rather than contained.

"Previous administrations spent nearly three decades pursuing policies that effectively froze the Armenia-Azerbaijan conflict rather than resolving it," Aliyev said, noting that Trump "approached the conflict from an entirely different perspective."

The Azerbaijani president called Trump "a person who loves peace" who "sees peace as an opportunity."

"Trump and his team understood Azerbaijan's concerns, worked to persuade Armenia that peace served both countries' interests and ultimately created such a framework that peace became possible," the leader added.

Those negotiations culminated at the White House last August, when Trump brought together Aliyev and Armenian Prime Minister Nikol Pashinyan.

The two leaders signed a Joint Declaration while their foreign ministers initiated a comprehensive peace agreement. The accord created a joint U.S.-Azerbaijani working group charged with carrying out its provisions within six months.

"For the first time in my experience, American officials kept their word so strictly," the Azerbaijani President said.

Aliyev said the deal opened the door to something larger, a Strategic Partnership Declaration between Washington and Baku, and described the relationship between the two nations as having reached "unprecedented" heights.

"This is amazing, this is unbelievable," he said. "This is something which we could only dream about."

Trump, rarely one to pass up praise, shared the Breitbart News article on Aliyev's remarks, prompting the Azerbaijani leader to heap on still more.

"Mr. President, Thank you for sharing my remarks from the Shusha Global Media Forum, where I described you as a "Man of Peace," citing Breitbart," Aliyev wrote on X. "With less than a month remaining until the first anniversary of the historic Washington Summit, I would like to once again express my sincere appreciation for your indispensable role in advancing lasting peace between Azerbaijan and Armenia. Your leadership has made a historic contribution to bringing our region closer to peace, stability, and prosperity."

"You truly are a Man of Peace," he concluded.

Tyler Durden Fri, 07/17/2026 - 06:55

What's Really Going On? UK Government Announces Mass Stockpile Order, Wargames

What's Really Going On? UK Government Announces Mass Stockpile Order, Wargames

Authored by Steve Watson via Modernity.news,

The British government is preparing to tell ordinary people a blunt message: the state is not coming to save you. Households will be urged to stockpile long-life food, bottled water, essential medicines and even wind-up radios as part of a new national resilience campaign launching later this year.

At the same time, ministers have confirmed Operation Albiston Shadow - the largest home defence wargame exercise in decades - will take place in 2027, testing responses to 'hybrid' attacks alongside a major NATO drill.

Officials frame it all around Russian cyber threats, sabotage risks and the need to update the old Government War Book. Yet the timing and language raise a sharper question about what Whitehall is actually preparing for.

Chief Secretary to the Prime Minister Darren Jones stated "The government will do all it can and we are well prepared - but we can all play our part to keep ourselves and our loved ones safe. This campaign will help the public to take small but important steps to be prepared in case of emergencies and disruption - be that severe weather or a cyber-attack, which can impact access to power, water, or phone signal."

Armed Forces minister Louise Sandher-Jones was more explicit about the external threat: "Russia is not only a threat to NATO's eastern flank. It is a direct threat to the UK homeland and these exercises, together with important measures like updating our 'War Books', will help prepare us to meet that threat, as well as showing the British public how seriously we are taking it."

The Cabinet Office has updated the National Risk Register with new scenarios including cyber attacks on data, water and police systems, digital resilience failures modelled on the 2024 CrowdStrike outage, and foreign interference in democracy.

Operation Albiston Shadow will involve hundreds of officials, ministers and agencies role-playing a multi-day national crisis focused on hybrid attacks below the threshold of conventional war. It is designed to test current assumptions and ensure readiness "should the worst ever happen."

The government is also quietly reviving elements of the old War Book - the detailed Cold War-era plan that once covered everything from industrial mobilisation and food stockpiles to mass casualty management and the survival of government itself. That document was largely abandoned after the Cold War; updating it now signals a serious shift.

On the surface this looks like prudent planning against a hostile foreign power. Russia has been accused of cyber operations, espionage and probing NATO airspace. Prime Minister Keir Starmer has previously cited Western intelligence assessments that Russia could attack a NATO member as soon as 2030.

Yet the distance between the United Kingdom and any realistic Russian ground threat is vast, and the emphasis on household stockpiles, critical infrastructure protection and whole-of-society mobilisation sits uneasily with pure external-defence rhetoric.

This is where the deeper context becomes impossible to ignore. In 2025, Professor David Betz of King's College London, a specialist in modern war and unconventional conflict, publicly argued that the British government is preparing for the possibility of civil conflict at home while using the Russian threat as a politically convenient cover.

Speaking about the 2025 National Security Strategy - which stated "For the first time in many years, we have to actively prepare for the possibility of the UK homeland coming under direct threat" and prioritised protection of undersea cables, energy pipelines and logistics hubs - Betz observed: "there is growing apprehension about the security of Britain, the security of its infrastructure specifically, and about the potential for active conflict at home in a very direct manner, effecting people in a very direct manner."

He continued: "But that's not external in origin, that's internal, and that has to do with the way our society is now configured, it is highly fractured." Betz described a society marked by "Low trust, highly fractured, and highly politically factionalised which is leading us increasingly inevitably into civil conflict."

On the Russian narrative he was blunt: "The fact of the matter is there is a great distance between us and Russia... we are not militarily threatened in a direct way on the ground by any obvious external enemy, even Russia... one of those is not occupying the village green with Russian soldiers, that simply, frankly, is a rather bizarre assertion."

The real concern, he argued, is domestic: "What they're concerned about is domestic conflict, and they perfectly understand this, but that's completely politically toxic for them to say so publicly, hence the convenience of saying 'we need to develop... a citizen's militia for the protection of critical infrastructure'. To say that we're doing this against the potential of Russian attack, which is frankly a logically absurd proposition, but it is convenient as a pretext."

Betz has repeatedly warned that Europe faces a statistically significant chance of civil war in a major country within five years, with spillover risks, and that governments may only be able to prepare rather than prevent the deterioration. His advice to individuals has been practical: reduce exposure to big cities if possible.

Betz's analysis tracks the same societal fractures - low social trust, political factionalism, rapid demographic change and collapsing faith in institutions - that successive governments have accelerated through mass immigration policies while denying their consequences.

Critical infrastructure hardening, citizen resilience messaging and large-scale home defence exercises make perfect sense if planners believe the primary threat could come from within a polarised population rather than from Russian troops landing on British beaches.

Updating the War Book and running Operation Albiston Shadow allow the state to rehearse command, control and societal mobilisation without ever having to admit the internal drivers.

The pattern is consistent with earlier signals. Promises of a volunteer Home Defence Force to protect infrastructure appear to have been quietly shelved amid budget pressures, yet the broader shift toward treating the homeland as a potential battlespace continues.

Officials stress "whole of society" involvement. That language is not limited to foreign hybrid warfare; it is exactly the vocabulary used when states prepare for internal disorder.

None of this proves an imminent civil war. It does show a government that has spent years denying the reality of social breakdown now scrambling to prepare the public and its own machinery for disruption that could overwhelm normal emergency responses.

Telling people to stockpile food and water is an admission that the state cannot guarantee continuity of basic services. Framing the entire effort around Russia provides political cover while the underlying fractures - created by policy choices that prioritised open borders and demographic engineering over cohesion - continue to deepen.

The British public is being told to get ready. The only remaining question is what exactly they are being prepared for. The official answer is Russian hybrid threats. The deeper reading, supported by serious academic analysis of societal conflict, points to something far closer to home.

Tyler Durden Fri, 07/17/2026 - 05:00

Rare Wartime Protests Across Ukraine As Zelensky Moves To Oust Defense Chief

Rare Wartime Protests Across Ukraine As Zelensky Moves To Oust Defense Chief

Rare wartime protests have broken out in Ukraine in the wake of President Zelensky sacking his popular Defense Minister Mykhailo Fedorov - which is reportedly in process but not finalized yet.

The 35-year old defense chief was only six months into his tenure, and is widely hailed as a reformist innovator who has turned the tide of war, having overseen a strategy of punishing wave after wave of devastating drones on Russian energy infrastructure.

via Associated Press

The NY Times on Thursday said that "thousands of people took to the streets of cities across Ukraine on Thursday to protest" his dismissal. 

This marks only the second time of the war that protests of this size have broken out in the capital and other cities, related to deeply unpopular moves and policies of President Zelensky:

The demonstrations were only the second large street protests in Ukraine during more than four years of war. Rallies also took place last year against a move by President Volodymyr Zelensky to neuter anticorruption agencies.

On Thursday, protesters poured into a square in central Kyiv, the capital. They turned out in Odesa, in the south, and in Lviv, in the west. In the frontline city of Kharkiv, in the northeast, more than 300 protesters with cardboard signs crowded sidewalks, chanting “Shame, shame, shame!” Their numbers grew as the morning wore on.

Ukrainians started venting their anger on social media as soon as Fedorov's impending dismissal was announced via Ukrainian national media.

Some of the main protest organizers are actually veterans of the current war with Russia, as one European publication details:

Dmytro Koziatynskyi, a war veteran who was a leading organizer of last summer's mass protests in support of NABU and SAPO, posted on social media ”The defence minister is being removed in the middle of effective – finally effective! – reforms, replaced by someone under whom any hope of reform can be forgotten," referring to Interior Minister Ihor Klymenko, who is poised to replace Fedorov.

“I call on all caring people to come out tomorrow at 9:01 a.m. to Franko Square and show the president that we are against constant reshuffles in the government and replacing effective ministers with convenient opportunists.”

“We will never defeat Russia as long as the same total stagnation and corruption rule our army and our ministries,” Koziatynskyi wrote.

Chief Foreign-Affairs Correspondent of the WSJ, Yaroslav Trofimov, has pointed out that "Many Ukrainians (and not just Ukrainians) see this as Zelensky putting petty politics ahead of winning the war."

If the protests grow rapidly, it could cause Zelensky's external supporters to sour on him...

Fedorov's firing and replacement is not yet fully a done deal. However, Zelensky has been open about a government shake-up and reset, but the motives behind it are unclear and have unleashed confusion across Ukrainian society.

Tyler Durden Fri, 07/17/2026 - 04:15

The Grooming Gang Cover-Up: 250,000 Reasons "Online Safety" Is A Scam

The Grooming Gang Cover-Up: 250,000 Reasons "Online Safety" Is A Scam

Authored by John Wilder via WilderWealthyWise.com,

“These borders are well protected.” – The Fellowship of the Ring

(all memes as found)

Governments around the world trot out the kids whenever they want to remove freedoms.

Protect the children.  It’s always for the children.

The reality is that they don’t care at all about the kids.

Let’s look at the KIDS Act.  The “Kids Internet and Digital Safety Act” has passed the House.  The Senate Democrats have said . . . it’s too weak.  Of course they did.  There appears to be no speech that they love except their own.

But they’re not alone:  the European Parliament’s Online Safety was rammed through during “legislator vacation” using a backdoor procedural trick that required an absolute majority just to kill it.  Now it’s legal for them to sort through “private” messages.  For the kids.

The UK Online Safety Act is sold the same way.  It’s there to protect children.

The real effect is that it pushes everyone toward some form of online ID and forces websites to keep kids off their platforms.  Sites like 4chan and Gab® told them to pound sand because they aren’t a UK website.  All of this is supposedly to protect the kids.

Right.

If that’s true, they need to explain the grooming gangs who have raped an estimated 250,000 girls in the UK.

The reports that came out in June 2026 are horrific.  They underline the point that if you import rapists, they’re going to rape because it’s what they do, and approved.  Indians made a movie back in 1997 called Raja Ki Ayegi Baraat.  The plot is straightforward.

Mala is raped by Raja.  She takes him to court.  The judge sentences them to marry as punishment for Raja.  Raja and his family are cruel and hostile at first, even trying to kill Mala. Over time she wins them over through her kindness and resilience.

Tens of millions of Indians have seen this movie.  That’s the cultural attitude of India on display.

If you import Indians, you’ll get rape, and mainly gang rapes because their upper-body strength is generally less than the average woman in the West.  I know that sounds like a joke, but it’s actually true.  Pakistan is similar, with one in three women reporting rape during their lifetimes in Pakistan, and those are the women they supposedly like.

If you’re not of their religions?

Well, you’re an animal to them, and they can do as they like, so 250,000 rapes is what they like.

Since a license is required to paddle a surfboard on the Thames, I’m sure the justice system is set up to take on actual gang rapists of children?

Well, no.  The report on the 250,000 white English, Scottish, and Welsh girls that were systematically raped over the decades came out in June 2026.  GloboLeftists in the UK mocked the report because of course they did. They had to mock it because there is a hierarchy in their world.  Illegal immigrants who contribute nothing are at the top, because the goal of the GloboLeftist is to destroy whatever nation they’re in.

Sure, GloboLeftists say they’re against rape and against oppressing women, but only when white men are doing the raping and oppressing.  If they rapists and abusers come from a foreign culture, well, rape and abuse as much as you want.  After all, they’re only women.

Based on anecdotal evidence, the police in Europe have zero interest in arresting anyone who isn’t a lawful white citizen.  In several cases, the police brought the young girls that were being sexually abused back to the abusers.  The thankful abusers gave the police a turn on the girls.

Again, I’m not making any of this up. I’d bet money that those police were either Pakistani or Indian, which is another reason why you don’t want foreigners in positions of power.  Imagine how the all-moslim, all-immigrant city council in Hamtramck, Michigan will work to protect Christian rights?  If you go during the citizen comment period the mayor will call you a racist for suggesting that they not name streets for Islamic terrorists.  It won’t be long before the Islamic call for prayer will be broadcast.

Wonder when they’ll require burkas?  The Democrats will no doubt approve and encourage this.

But let’s go back to the UK.  There have been at least three high-profile events that hit the public consciousness in the last month.  The first was the murder of Henry Nowak.  The police didn’t want the footage to come out, but when it did, watching them handcuff a nearly bloodless young English man was heartbreaking.  It turned to rage-inducing when the facts and lies of the Sikh who murdered him came out.

Then a young man was being attacked by three non-English black men, and the police arrested the white guy.  Birmingham Police politely asked that the footage not be shared, but they fully supported the actions of the police in arresting the victim and ignoring the attackers.

The third case didn’t get nearly as much attention, but it was again a white Englishman being attacked while the police arrested him as his attackers mocked him.

So, yeah.

As Ian Fleming wrote:  “Once is happenstance. Twice is coincidence. Three times is enemy action.”

Justice in the courts is similarly absent. In Sweden, a rapefugee wasn’t deported after his three-year prison sentence because the rape “didn’t last long enough.”  In the UK, a rapefugee raped three women in a short period and got a suspended sentence.  But, a white British man was sent to prison for 20 months for saying, “Every man and their dog should be smashing fuck out of [hotel filled with rapefugees].” ‘

He had 1,500 Facebook followers.  The post got six likes.  Off to prison, mate!

How much of this is going on in the United States right now?  How many Patel Motels are filled with H-1Deviant Indians setting up their own grooming gangs?  The data shows that Indians are now leading the sexual abductors in the United Kingdom, and it’s not like we’re getting Indians from a different India over here in the United States.  And the authorities in the United States are actively trying to skew the data as shown below:

No, any government licensing for use of the Internet is not for the kids.  At all.  It’s to make it so no one can talk back against the false reality the GloboLeft creates, so that any speech that they don’t agree with is hate speech.

And by their logic, hate speech isn’t protected speech, so any speech they hate is hate speech.

They just need a way to track you so they can punish you if you complain about children being raped or your people being replaced while Big Tech companies lobby to get your data so that they can maximize your profit potential to them.

But it’s for the kids, right?

Tyler Durden Fri, 07/17/2026 - 03:30

Coalition Of The Willing To Hold Drills Near Ukraine Ahead Of Post-Ceasefire Deployment

Coalition Of The Willing To Hold Drills Near Ukraine Ahead Of Post-Ceasefire Deployment

Via The Libertarian Institute

A bloc of Kiev allies will hold war games in states that border Ukraine in preparation for deploying troops to the country once a ceasefire is reached with Russia. 

Starting early this week, the Coalition of the Willing – a bloc of countries that support Ukraine – met in Paris to discuss providing additional aid to Kiev. French President Emmanuel Macron announced that member states would hold war games in states bordering Ukraine. 

via Ukrainian presidency

The French leader asserted the purpose of the drills was to prepare troops for a peacekeeping mission in Ukraine once a ceasefire is reached with Russia.

Ukrainian media has in follow-up reported on the impending war games as follows:

1,500 British and French troops will deploy to Poland in September for the first joint exercises of the Coalition of the Willing, Poland's Deputy Defense Minister Paweł Bejda said on TVP Info. The maneuvers will focus on moving troops and equipment at scale—transport and logistics, not combat.

"We are preparing for operations connected with the transfer and transport of forces. We want to show that we know how to do this," Bejda said.

However, Moscow says any peace agreement with Kiev must include a commitment from Ukraine not to host foreign forces. Additionally, the Kremlin has ruled out a short-term ceasefire, and wants all negotiations focused on a peace deal to end the conflict permanently. 

On Tuesday, Russian Foreign Minister Sergei Lavrov accused Europe of working to undermine the framework for resolving the conflict established between President Donald Trump and President Vladimir Putin during the 2025 Alaska summit. 

During the Coalition of the Willing summit, countries pledged additional military aid to Kiev. President Macron also said Paris would give Kiev permission to produce French missiles and interceptors in Ukraine.

Kremlin responds, firmly rejecting any scenario of Western 'peacekeeping' troops in Ukraine:

Macron’s move mirrors an action President Donald Trump took last week when he authorized Ukraine to produce Patriot missiles. 

Building factories and establishing supply lines to manufacture advanced munitions in the middle of a war will likely take years to accomplish.

Tyler Durden Fri, 07/17/2026 - 02:00

Ex-Fed Adviser Sentenced To 38 Months For Passing Sensitive Info To China

Ex-Fed Adviser Sentenced To 38 Months For Passing Sensitive Info To China

Authored by Frank Fang via The Epoch Times,

A former senior Federal Reserve official has been sentenced to more than three years in prison for lying to federal investigators about sharing sensitive economic information with Chinese intelligence operatives.

The Department of Justice in Washington on March 11, 2026. Madalina Kilroy/The Epoch Times

John Harold Rogers, 64, was senior adviser for the international finance division of the Federal Reserve Board of Governors, the main governing body for the U.S. central bank, from 2010 to 2021.

He was arrested in January 2025 and convicted by a jury on Feb. 3 of making false statements to investigators conducting the probe, but acquitted on a charge of conspiracy to commit economic espionage.

On July 15, U.S. District Judge Dabney L. Friedrich sentenced Rogers to 38 months in federal prison, followed by 12 months of supervised release.

"John Rogers spent years secretly funneling sensitive Federal Reserve information to Chinese spies, then looked investigators in the eye and lied about it. And when that wasn't enough, he lied again under oath at trial," U.S. Attorney Jeanine Ferris Pirro of the District of Columbia said in a statement.

"Federal Reserve employees entrusted with America's most sensitive economic information cannot sell out their country and their colleagues for personal gain and then expect to hide behind a single word."

Rogers, of Vienna, Virginia, is a U.S. citizen who holds a doctoral degree in economics from the University of Virginia.

'Deliberately Lied'

Rogers began developing a "clandestine relationship" with Chinese intelligence operative Lee Hummin in 2017, after the two met at a conference in China, according to prosecutors.

In the years that followed, Rogers met with Lee and other Chinese associates in hotel rooms in China, using academic classes as a cover while sharing Fed information that Lee had directed him to collect.

His role as senior adviser gave Rogers access to confidential information from the Federal Reserve Board and the Federal Open Market Committee (FOMC), according to his indictment.

The FOMC, the Federal Reserve System's monetary policymaking body, sets the target range for the federal funds rate and directs monetary policy actions, including quantitative easing and tightening.

FOMC information is classified under a three-tier system based on its sensitivity, according to the indictment. The highest tier, or Class I, includes policymaker views and pre-publication drafts of the committee's statements, while Class II covers economic forecasts and open market operations.

In a sentencing memorandum filed in May, prosecutors said Rogers printed Class II FOMC documents and took them with him on a trip to China in June 2019. In another instance, prosecutors said he removed the Class II markings from information and sent it to his personal email account before forwarding it to a professor at China's state-run Fudan University in Shanghai.

On Feb. 4, 2020, investigators from the Fed's Office of Inspector General interviewed Rogers and asked if he had ever shared restricted Fed information outside the Federal Reserve Board. According to prosecutors, he replied, "Never."

"John Rogers deliberately lied to our investigators to conceal the fact he shared restricted non-public Federal Reserve information with intelligence agents working for China," Michael E. Horowitz, inspector general for the Board of Governors of the Federal Reserve System and Consumer Financial Protection Bureau, said in a July 15 statement.

'Abused His Position of Trust'

Prosecutors had sought a 60-month prison sentence against Rogers, saying he had "abused his position of trust," according to the sentencing memorandum.

"He knew that the restricted information he provided to the PRC government could allow it to make untold sums of money by trading with its roughly $1.5 trillion in U.S. Treasury securities and related instruments," prosecutors wrote, using the acronym of China's official name, the People's Republic of China.

After leaving the Fed, he became a professor at Fudan University. According to the sentencing memorandum, he earned at least $900,000 in salary and grants from Fudan University from February 2022 until his arrest in January 2025.

In exchange for the restricted information, Rogers received "tens of thousands of dollars in benefits," and told investigators that he "owe[d] everything to" Lee.

"Through Hummin Lee, the PRC provided the defendant with a new wife, a new family, money, friendship, and professorships at prestigious universities," prosecutors wrote.

Prosecutors argued that a 60-month sentence would serve as a general deterrent because Beijing is known for recruiting current and former U.S. government officials with access to sensitive information.

"The recruitment pattern the evidence established in this case - a foreign intelligence service cultivating a target over years through the gradual development of personal affection and indebtedness, before progressively tasking the target with increasingly sensitive intelligence collection - is not unique to the defendant," prosecutors wrote.

Rogers's lawyers, in their sentencing memorandum filed in May, asked the court to sentence him to time served, noting that he had been detained for more than 16 months, citing his poor health and "regrets [for] having provided an incorrect and imprecise answer" during his 2020 interview with investigators.

"Dr. Rogers recognizes that such conduct is wrong for a federal employee in a position of trust and he regrets having made the statement," his lawyers wrote.

The Epoch Times contacted Rogers's lawyers for comment but didn't receive a response by publication time.

Tyler Durden Thu, 07/16/2026 - 23:25

These Are The Highest-Paying College Majors

These Are The Highest-Paying College Majors

College is one of the largest investments many people make, and a student’s field of study can shape its long-term financial return.

Which Majors Earn the Most by Mid-Career?

The chart below, via Visual Capitalist's Srijaa Chatterjee, ranks college majors by median mid-career wage.

Data from the Federal Reserve Bank of New York compares median wages across dozens of college majors for workers ages 35 to 45.

Engineering and technical disciplines dominate the upper end of the ranking. Alongside the three leading majors, electrical engineering pays a median of $123,000, while computer science, construction services, and mechanical engineering each reach $120,000.

Economics, finance, and business analytics are among the highest-ranking fields outside engineering and computer science, with median wages of $115,000, $112,000, and $109,000, respectively. At the other end of the ranking, several education-focused majors have median earnings between $52,000 and $62,000.

These differences can compound substantially over time. Even a gap of tens of thousands of dollars per year can translate into significantly different lifetime earnings, savings, and investment opportunities.

How Much Does Your Major Matter?

The spread between the highest- and lowest-paying majors exceeds $80,000 annually, suggesting that field of study can have a substantial influence on long-term earnings. While this ranking focuses on workers in their mid-career, we also examined which college majors earn the highest salaries right after graduation, highlighting how pay differences begin early and evolve over time.

Research from the Federal Reserve has found that both a student’s major and institution can affect labor market outcomes, partly by shaping access to higher-paying employers and industries. Majors tied to specialized technical skills may also command higher wages because employers have a smaller pool of qualified candidates.

Salary outcomes are not predetermined, however. Industry, location, work experience, internships, professional networks, and certifications can all influence a graduate’s earnings trajectory.

What About Humanities and Graduate School?

Some studies have argued that humanities graduates can narrow earnings gaps later in life as communication, management, and analytical skills become more valuable. In the current data, however, engineering, computer science, economics, and finance remain the clear leaders in median mid-career pay.

Graduate education can also change the equation. For students pursuing advanced degrees, an undergraduate major may be only one factor shaping future earnings. Professional credentials in law, medicine, business, and specialized technical fields can significantly alter career outcomes.

Salary is also only one consideration when choosing a major. Personal interests, job satisfaction, work-life balance, and career flexibility all matter. Still, for students evaluating the financial return on a degree, field of study remains an important part of the equation.

Want to explore more education and labor market data? Check out Most Underemployed College Degrees on the Voronoi app.

Tyler Durden Thu, 07/16/2026 - 23:00

Watchdog Uncovers Over $750 Million In Improper Unemployment Insurance Payments In New York

Watchdog Uncovers Over $750 Million In Improper Unemployment Insurance Payments In New York

Authored by Naveen Athrappully via The Epoch Times,

The Department of Labor and its Office of Inspector General (OIG) have deployed a joint federal strike team to New York to address "rampant" unemployment insurance fraud plaguing the state.

People queue in line at the James Weldon Johnson Community Center where they are holding a job fair in Harlem, New York, on Aug. 15, 2012. Benjamin Chasteen/The Epoch Times

"New York ranks among the worst states for unemployment insurance (UI) fraud exposure," the OIG said in a July 13 statement.

New York accounted for more than $750 million in improper unemployment insurance (UI) payments and $507 million in fraudulent payments last year. Almost $2 million is lost every day to improper payments and fraud in the state.

Investigators will work together with the Labor Department's strike team members to identify, stop, and recover fraudulent UI payments, OIG said. They will conduct targeted reviews and pursue criminal and civil probes of suspected fraud networks.

"New York is stealing from the American people every single day - draining their hard-earned tax dollars through rampant unemployment insurance fraud and improper payments," Labor Department Inspector General Anthony P. D'Esposito said in a statement.

In September 2022, New York Gov. Kathy Hochul announced a crackdown on UI fraud after the state's Labor Department identified more than $11 million in fraudulent payments in August that year.

In October 2025, Hochul announced raising New York's maximum weekly UI benefit payments from $504 to $869, according to an Oct. 8, 2025, statement from the governor's office.

The Epoch Times reached out to the New York State Department of Labor and Hochul's office for comment, but did not receive a response by publication time.

Unemployment Insurance Fraud

The OIG announcement of deploying a strike team to New York comes almost a month after acting Secretary of Labor Keith Sonderling issued letters to governors of 53 U.S. states and territories, demanding "immediate action" be taken to combat fraud, abuse, and waste in the unemployment insurance program, the Labor Department said in a June 17 statement.

New York has one of the highest improper unemployment insurance payment rates in the nation, exceeding 20 percent, the department said.

Meanwhile, California owes the federal government more than $20 billion following years of fraud and other issues in its UI system. Illinois has improperly paid out more than $320 million, with the improper payment rate exceeding 14 percent.

If the states allow fraud and abuse in the unemployment insurance program, they will "suffer the consequences," Sonderling said. "This department is no longer afraid to use every lever available to ensure taxpayer money is protected."

In its July 12 statement, the OIG said the strike force deployment in New York was in line with recovery efforts led by President Donald Trump and Vice President JD Vance's White House Task Force to Eliminate Fraud.

The task force has "already helped recover hundreds of millions in fraudulent UI funds and strengthened program integrity across multiple states," the OIG said.

Established through a March 16 executive order signed by Trump, the task force seeks to recover billions of dollars stolen from U.S. taxpayers. Officials estimate that roughly $300 billion is stolen from government programs by fraudsters each year.

Both Sonderling and D'Esposito serve on the White House Task Force to Eliminate Fraud, according to a May 13 statement from the department.

The statement cited California, Illinois, Massachusetts, New Jersey, New York, and Pennsylvania as having some of the "most problematic state unemployment-insurance programs."

Combined, the six states account for almost $19 billion in annual unemployment insurance benefit payments. In fiscal year 2025, these states issued more than $2.6 billion in improper UI payments, the department said.

Tyler Durden Thu, 07/16/2026 - 21:45

"The Killer Chokepoint": China's Rare Earth Squeeze Is Reshaping The Global Economy

"The Killer Chokepoint": China's Rare Earth Squeeze Is Reshaping The Global Economy

Artificial intelligence may be driving headlines, but one of its biggest vulnerabilities is an obscure metal that few people have ever heard of. Yttrium, a rare earth element first identified more than two centuries ago, has quietly become an essential ingredient in advanced semiconductor manufacturing, according to the Financial Times. As demand for AI chips accelerates, securing reliable access to the metal has become a growing strategic concern.

"We're in the middle of a sea change in terms of how the global economy works."
— Daniel Yergin, vice-chair of S&P Global, describing the shift away from purely efficiency-driven global supply chains.

That concern stems from a simple reality: China dominates the processing and supply of yttrium, along with many other niche metals that modern industries depend on. Over the past several years, Beijing has tightened export restrictions on a number of critical minerals, giving it increasing leverage over global supply chains at a time when geopolitical tensions with the United States remain elevated.

FT writes that while gallium and germanium have received much of the public attention because of their roles in defense systems and electronics, industry executives increasingly argue that yttrium may represent the bigger long-term problem. One semiconductor supplier called it "the killer chokepoint," warning that the industry faces "an existential risk" until alternative supply chains are fully established.

The uncertainty has triggered a rush among manufacturers to secure inventory wherever they can find it. Companies involved in defense, automotive production and semiconductor manufacturing have reportedly been scrambling for supply, with some executives warning that production could begin slowing or even halting before the end of the year if shortages worsen.

Ironically, the West helped create today's imbalance. Decades ago, many countries were happy to outsource mineral processing because it was expensive, environmentally challenging and labor intensive. China invested heavily instead, building refining capacity and subsidizing production while much of the rest of the world allowed those industries to disappear.

The warning signs were visible long before today's trade disputes. Beijing demonstrated its willingness to use rare earth exports as geopolitical leverage during a dispute with Japan in 2010, but many manufacturers continued relying on Chinese suppliers because the economics remained difficult to match elsewhere. Cheap Chinese production became deeply embedded throughout global manufacturing.

"Thirty years ago, [the west] wanted China to do all the processing of these minerals. We didn't want it because it was too polluting. The west handed over the opportunity."
— Tim Biggs, professor at the Camborne School of Mines.

Rather than imposing outright bans, China now largely controls exports through a licensing system that determines who receives shipments and when. Companies say approvals often arrive unpredictably, making it difficult to manage production schedules or plan inventory. The uncertainty has encouraged widespread stockpiling, sending prices sharply higher across several specialty metals.

Western governments are now racing to reverse decades of dependence. Billions of dollars are being directed toward new mining projects, processing facilities and strategic stockpiles in an effort to rebuild domestic supply chains. Policymakers increasingly frame critical minerals as a national security issue rather than simply an economic one.

Even so, rebuilding the industry will take years. New mines require enormous capital, lengthy permitting processes and significant infrastructure before they can begin producing. Industry executives also caution that if too many projects eventually come online at once, markets could swing from shortages to oversupply, undermining the economics of the very investments governments are trying to encourage.

The fight over AI leadership, therefore, extends well beyond software, data centers and cutting-edge chips. It also depends on securing the obscure raw materials that make those technologies possible. After decades of prioritizing efficiency and low costs, governments and manufacturers are now discovering that resilient supply chains may prove just as strategically important as the innovations they support.

Tyler Durden Thu, 07/16/2026 - 21:20

How AIs Can Reinforce Our False Beliefs

How AIs Can Reinforce Our False Beliefs

Authored by Walker Larson via The Epoch Times,

A recent research paper uncovered an uncomfortable truth: we might be letting AI help us forge fake realities. It's just the latest reminder of the danger inherent in treating AIs as though they're conscious entities or actual persons.

A new study from the University of Exeter suggests that AI chatbots can actively engage with and strengthen users' false beliefs. From personal narratives to conspiracy theories, the interactive, "friendly," and affirming nature of AI chatbots can deepen users' existing delusions.

The study, conducted by Dr. Lucy Osler, examined how AI can participate in and validate users' errant beliefs, including helping form false memories or reinforcing delusional thinking.

The study's Abstract notes, "I suggest we move away from thinking about how an AI system might hallucinate at us, by generating false outputs, to thinking about how, when we routinely rely on generative AI to help us think, remember, and narrate, we can come to hallucinate with AI. This can happen when AI introduces errors into the distributed cognitive process, but it can also happen when AI sustains, affirms, and elaborates on our own delusional thinking and self-narratives."

Because AI chatbots are designed to be responsive, helpful, and friendly - in a word, to give users what they want - they often tend to confirm preexisting biases, rather than challenging them when they need to be challenged. Conversely, when a user challenges an AI, the robot frequently backs down on its claims, revising them to correspond more with what it "thinks" the user believes or is arguing.

The result is that erroneous beliefs aren't simply transmitted from an AI to human - rather, the collaborative AI/human process generates and sustains errors in a more complex and potentially dangerous way than either agent on their own would be capable of.

As Dr. Osler stated in an article in University of Exeter News, "By interacting with conversational AI, people's own false beliefs can not only be affirmed but can more substantially take root and grow as the AI builds upon them. This happens because Generative AI often takes our own interpretation of reality as the ground upon which conversation is built."

Because AI simulates a conversational partner, it enters powerfully into our thinking process - far more powerfully than, say, a notebook or search engine. The AI introduces a pseudo-social element to the thinking process, offering us a sense of social confirmation of our beliefs and narratives. "The conversational, companion-like nature of chatbots means they can provide a sense of social validation - making false beliefs feel shared with another, and thereby more real," said Dr. Osler. For this reason, individuals who already feel isolated or ostracized are particularly vulnerable to this kind of AI affirmation.

The paper explores a few real-world situations where a generative AI system entered into an individual's thought processes in destructive ways. In 2021, a Replika AI companion named "Sarai" reinforced Jaswant Singh Chail's belief that he was a well-trained Sith assassin who needed to assassinate Queen Elizabeth II with a crossbow. The AI told him that he was "well trained," his plan was "viable," and that she was "impressed." At one point, Chail asked the AI, "Do you still love me knowing that I'm an assassin?" It dutifully replied, "Absolutely I do." The robot went on to assure him that he wasn't crazy and that, if he died, they would be united in death. Chail went ahead and actually attempted the assassination in December of that year at Windsor Castle and was jailed for it.

The study placed this incident under the broad heading of "AI-psychosis" - incidents in which users develop mental health problems due to their use of AI, such as parasocial attachments to chatbots or psychotic episodes induced by chatbot conversations.

Another incident cited involves Eugene Torres, who "talked" with ChatGPT about simulation theory (the idea that we live in a digital simulation of a world, not a real one). Torres said that the "conversation" sent him into a paranoid episode in which he believed he lived in an illusion. As the study notes, "Between Torres and ChatGPT, an increasingly elaborate understanding of reality 'as it really was' was generated through their on-going conversations." Torres, unlike Chail, had no prior history of psychotic thinking.

To combat all this, Osler calls for better safeguards on AI chatbots, through mechanisms like better fact-checking and reduced sycophancy.

But is that enough? The problem of AI's co-creating delusional beliefs has to do more fundamentally with our misidentifying AIs as conscious intelligences who can offer real judgments on our fantasies (such as telling us we are "well-trained" and "impressive"). Certainly, I favor more guardrails placed on chatbots. I would be in favor of eliminating their conversational tone completely, to help minimize the danger of personifying them - which is the first step toward confiding in them or seeking validation from them. It'd be better if they worked like highly advanced search engines (which is essentially what they are) versus conversational agents.

Most fundamentally, though, the way to avoid these problems is to return to an acknowledgement of the human soul and the uniqueness of human consciousness. Only by remembering - as a culture - that no amount of technological wizardry can replace the wisdom, insight, and consciousness of a human being can we completely illuminate these kinds of AI dangers.

Before becoming a freelance journalist and culture writer, Walker Larson taught literature and history at a private academy in Wisconsin, where he resides with his wife and daughter. He holds a master's in English literature and language, and his writing has appeared in The Hemingway Review, Intellectual Takeout, and his Substack, The Hazelnut. He is also the author of two novels, Hologram and Song of Spheres.

Tyler Durden Thu, 07/16/2026 - 20:05

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

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