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Iran War Has Cost Nearly $2,000 Per US Household: Moody's Top Economist

2026-10-15T14:19:30.169-07:00

Iran War Has Cost Nearly $2,000 Per US Household: Moody's Top Economist

Moody's Analytics chief economist Mark Zandi estimated Oct. 12 that the Iran war has cost the average U.S. household nearly $2,000 since it began, or about $265 billion nationwide. He put roughly $1,100 per household on higher energy and transportation costs, $540 on higher interest rates and $360 on military spending, and said the energy tab is still rising by about $50 per household each week at current fuel prices.

An MH-60R Sea Hawk helicopter, assigned to Helicopter Maritime Strike Squadron 50, takes off from the flight deck of the Arleigh Burke-class guided-missile destroyer USS Thomas Hudner on May 4, 2026. US NAVY/AFP via Getty Images

Zandi wrote on X: "Consider that the war's costs taken together have absorbed about half the average American household's income gain over the past eight months. No wonder the war is so unpopular."

White House Principal Deputy Press Secretary Anna Kelly answered in a statement: "Mark Zandi is a Democrat donor who is frequently wrong - including predicting multiple recessions that never happened." She added: "President Trump is rightfully ensuring that Iran, a country that for 47 years chanted 'Death to America,' can never have a nuclear weapon." U.S. and Israeli strikes on Iran began Feb. 28.

Consider that the war’s costs taken together have absorbed about half the average American household’s income gain over the past eight months. No wonder the war is so unpopular.
— Mark Zandi (@Markzandi) October 12, 2026

Zandi's number is a broad economic estimate, not a federal outlay. Brown University puts consumer costs at $133.3 billion, about $1,018 per household, and Defense Secretary Pete Hegseth has testified to about $37.5 billion in direct military costs, Newsweek reported. ZH has tracked estimates running well above the White House's.

As the Epoch Times notes further, "Higher energy prices are contributing most to the costs," Zandi said. "A gallon of regular goes for $4.37, up from just under $3 before the war. Diesel is above $6, and jet fuel has nearly doubled. As winter approaches, the much higher price of home heating fuel is also adding to the costs."

Zandi said the war's inflation contributed to the Fed's decision last month to raise rates and signal that more rate increases are coming.

"Long-term rates are also up a lot - fixed mortgage rates have climbed from below 6 percent before the war to 7.5 percent. By our reckoning, the higher rates have cost the economy about $540 per household," he said.

In September, the Congressional Budget Office estimated the war cost the U.S. military $38.1 billion through Aug. 1. With fighting expected to continue, the war was estimated to cost between $2 billion and $3 billion each month, depending on its intensity.

On Oct. 5, the Congressional Research Service published a report listing some of the major equipment losses during the war.

The report listed 81 fixed-wing or rotary-wing aircraft, including drones that were lost or damaged during the conflict.

The Congressional Budget Office estimated the cost of equipment losses as of Aug. 1 to be between $1.9 billion and $3.3 billion, depending on the Department of War's plans for replacement.

Democrats have continually pointed to the cost of the war in their criticism of Trump.

In September, 46 Democratic or left-leaning Independent Senators sent a letter to Department of War Secretary Pete Hegseth demanding more information on the costs of the war.

Tyler Durden Thu, 10/15/2026 - 15:35
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Dowd: "Investment Bubbles Are A Feature Of Capitalism, Not A Bug"

2026-10-14T14:19:32.915-07:00

Dowd: "Investment Bubbles Are A Feature Of Capitalism, Not A Bug"

Authored by Ed Dowd via Ed Dowd's Beyond The Narrative Substack,

On Friday October 9th Bloomberg published an article titled "Jeffries' Chris Wood Sees 'Massive Capital Destruction' in AI." His view is that the most likely long-term outcome of the AI boom is massive capital destruction in the US, with market share shifting to cheaper open-source Chinese models. Wood has mostly got it right in my opinion except for two differences. My first difference is that Chinese models are not the only open-source models available and that western open-source models are closing the gap. Secondly, while his view correctly flags the overbuild and the competitive pressure from lower-cost alternatives what it leaves out is the long history of innovative technology infrastructure bubbles and the reliable pattern that follows them which is:

excitement/mania → overinvestment → financial collapse → distressed assets → recapitalized cheap infrastructure fuels the next economic wave.

In regard to the AI bubble, I believe we are currently in the overinvestment phase with cracks emerging. Let us look at some historical examples to illustrate the pattern and see if we can glean what the future of this current bubble might look like.

The US Railroad Bubble

In the decades after the Civil War, railroads became the transformative technology of the era. Capital, much of it European, flooded in. Between the late 1860s and early 1870s, tens of thousands of miles of track were laid, often into sparsely settled or unprofitable territory. Speculative financing, land grants, and the expectation of endless growth created a classic mania. Early projects showed strong returns, which attracted more money into later, riskier lines built far ahead of demand. When financing dried up, highlighted by the failure of Jay Cooke's bank in marketing Northern Pacific bonds, the Panic of 1873 followed. More than 100 railroads went bankrupt in the ensuing years, banks failed, and investors were wiped out. The depression lasted years. Yet the physical tracks remained. The surviving and reorganized network became the backbone of American industrial expansion, enabling efficient movement of goods, people, and capital that powered decades of growth. The overbuilt infrastructure, once distressed and recapitalized, proved far more valuable to the broader economy than the paper losses suggested.

The 1920s Utility Bubble

The 1920s electrification boom followed a similar script. Central-station utilities expanded rapidly, and holding companies consolidated regional systems into large, leveraged empires. Electricity generation and revenues grew dramatically as the technology moved from novelty to infrastructure. Utility stocks soared and became a major part of the market. Holding companies facilitated access to capital and technical expertise, but the structures were opaque, and capacity was built aggressively. The 1929 crash and subsequent Depression exposed the leverage and accounting. Samuel Insull's empire collapsed in spectacular fashion, and the Dow Jones Utilities Average plunged. Reforms including the Public Utility Holding Company Act of 1935 broke up the largest structures and shifted the industry toward regulated regional monopolies. What remained was a vastly expanded electrical grid and generation capacity. Widespread electrification transformed industry, homes, and productivity for the rest of the century. The bust was painful for equity and debt holders; the long-term economic payoff from cheap, abundant power was enormous.

The Dotcom Bubble

The most recent and directly analogous example is the late 1990s telecom fiber buildout during the Dotcom era. Carriers and infrastructure firms poured hundreds of billions into fiber-optic networks, switches, and related equipment, largely financed with debt and encouraged by forecasts of internet traffic doubling every few months. Capacity vastly exceeded near-term demand. After the bubble burst, market values collapsed, many telecoms went bankrupt, and bandwidth prices fell sharply. A large portion of the newly laid fiber sat "dark" or unlit. Through bankruptcies and recapitalizations, that physical infrastructure was acquired at deep discounts, often pennies on the dollar. The resulting cheap broadband made business models viable that would have been prohibitively expensive otherwise. Google, YouTube, Facebook, Apple's smartphone ecosystem, Netflix, software-as-a-service, and cloud services all scaled on that excess capacity. Without the overbuilding and subsequent distress, Web 2.0 as we know it does not happen at the same speed or cost. The capital destruction was real but the residual infrastructure seeded the next wave of growth.

AI Bubble (Yes it is a bubble!)

I believe we are now in the AI infrastructure equivalent of the overinvestment phase. Massive capital is flowing into data centers, chips, power, and related equipment. The sheer scale of spending is turning advanced AI models into a commodity faster than many equity and debt investors appear to appreciate. Chinese open-source models are already applying downward pricing pressure, consistent with the Jefferies view. Cracks are visible. In my Substack piece "Wall Street's AI Capex Party...It's 2 AM & The Bar Is About to Close!", the signals included stalled private credit funding for the buildout, cracking enterprise demand as promised productivity gains fail to materialize at scale, looming power constraints that are becoming the binding limit rather than chip supply, and open-source pricing pressure that compresses margins.

Additional recent indicators from public commentary reinforce this: circular deals in which AI companies run negative free cash flow and rely on debt investors to keep purchasing chips at elevated prices; recent analyses showing major players cannot cover contracted compute commitments under realistic revenue assumptions; and narrative shifts such as space based data centers that paper over terrestrial grid and power bottlenecks. Growth rates implied by current valuations look vulnerable once the second derivative of funding and utilization slows. It is not a question of not if the bubble bursts but when it bursts.

Credit Markets Always End Infrastructure Buildouts

Debt and credit have been central to every one of these infrastructure buildouts. In the railroad boom, bonds financed the majority of the expansion, often more than three-quarters of the capital. When those markets stopped absorbing new bond issues (e.g. Jay Cooke & Co. could no longer place Northern Pacific bonds) the credit system seized up. Then bank runs followed, the New York Stock Exchange closed for ten days, and within two years roughly a third of outstanding railroad bonds had stopped paying interest. The equity markets lagged in this period...credit markets ended the railroad party abruptly.

The 1920s utility expansion followed the same pattern on a different scale. Samuel Insull's holding company pyramid relied on layers of debt and bank loans secured by the securities of the operating companies themselves (financial engineering). Once revenues softened and the banks refused to roll the notes in 1932, the structure collapsed into receivership. In this period the equity markets led the credit markets first with the 1929 crash then credit followed later.

In the telecom fiber boom, carriers raised hundreds of billions in bonds and used vendor financing and circular deals to keep the buildout going. Credit markets ultimately marked the end of the buildout but equities peaked in March of 2000 before credit. Credit spreads later widened sharply in 2001 and 2002, defaults clustered in the sector for years, and bondholders recovered roughly twenty cents on the dollar in many cases. When lenders stopped funding incremental capacity, the overinvestment phase ended and the financial collapse began.

The same dynamic is now visible in the AI buildout, where private credit has stalled, circular debt structures are proliferating, off balance sheet financing is growing and early signs of stress are appearing in CCC junk credit markets. Whether equity markets lead or lag this cycle remains to be seen but the case could be made that given the tremendous amount of passive equity investing the discounting mechanism of equity could lag and credit leads this time.

Bottom Line

Innovative technology capex cycles repeat themselves because human nature has not changed. Mania and excitement give way to overinvestment, which produces financial collapse and distressed assets. Those assets then become the cheap foundation for the next economic wave. Those who believe in cycles and a constant human nature may want to protect themselves accordingly and reduce exposure in the AI complex where risk-reward no longer makes sense. Then when the bust does arrive watch for the opportunities that emerge from the ashes where durable longer-term value will be created.

Bubbles are a feature of capitalism, not a bug. They destroy capital in the short run and, through the process of overbuilding and recapitalization, often leave behind the physical and technical foundation for longer-term productivity gains. The pattern is consistent throughout history...though the timing and severity may vary. The long-term outcome for the economy is usually more favorable than the peak-to-trough equity charts imply and a net positive over time.

"What has been will be again, what has been done will be done again; there is nothing new under the sun." Ecclesiastes 1:9

Tyler Durden Wed, 10/14/2026 - 15:20
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Big Tech Pushes Back On Paying For A Grid That Was Crumbling Long Before AI

2026-10-13T15:19:32.876-07:00

Big Tech Pushes Back On Paying For A Grid That Was Crumbling Long Before AI

When Big Tech signed President Trump's Ratepayer Protection Pledge in March, promising to pay for all the new grid infrastructure upgrades required to service their data centers, we cautioned that "voluntary pledges from trillion-dollar tech giants have a habit of evolving."

Seven months later, the hyperscalers are pushing back on how much of the grid's bill is theirs to pay.

The past week brought a Democratic Senate report and a North Carolina utility settlement, and FERC is expected to rule on whether new data centers must bring their own power.

But before anyone grabs a pitchfork, ask the question none of them answers: how much of this bill is really AI's, and how much is the cost of decades of grid neglect?

On Friday, Senators Elizabeth Warren, Chris Van Hollen and Richard Blumenthal released Power and Profits, the result of a nearly yearlong investigation into seven data center operators including Amazon, Google, Meta and Microsoft. The headline finding is as you would expect: the companies' promises to cover their full costs apply to infrastructure serving only their own facilities, not the full cost of shared grid upgrades their arrival triggers.

The companies broadly opposed the "but-for" standard consumer advocates are pushing, under which a data center pays for any shared upgrade that "would not have been built but for the data center." One hyperscaler told Senate staff that such upgrades often provide a "system benefit which should be shared among all ratepayers."

They also balked at minimum bills, which advocates want set at 80% to 90% of contracted demand whether the power gets used or not. One Big Tech firm called a 90% floor "insanely high." Another called 85% to 90% "unreasonably high," since facilities often don't use all of their projected demand.

Two days earlier, Duke Energy announced a settlement, signed by Amazon, Google, Meta, Microsoft and North Carolina's utility consumer advocate, that it says ensures data centers "will pay upfront for all costs to connect to the grid."

The settlement itself is more nuanced. Data centers prepay the full cost of equipment that serves only them, such as a dedicated substation. For shared transmission upgrades, they post a letter of credit covering the estimated cost, collateral that starts shrinking once the facility consistently draws 75% of its contracted demand.

Whether data centers get directly charged for any slice of those shared costs is punted to a Duke study due a year after approval, and would apply only to future contracts.

Bring Your Own Power... Or Else

Then there's PJM, which wants new data centers of 50 MW or more, starting in June 2027, to bring their own new capacity or be first in line to be cut off when the grid is strained.

PJM asked FERC to sign off by October 12. The Data Center Coalition urged FERC to reject the plan, and Google, which just contracted for 890 MW of new nuclear uprates from Constellation, has warned it would "chill investment."

With Goldman now expecting behind-the-meter power to supply a quarter of all data centers by 2030, more of them may decide that building their own plants beats arguing over the grid's bill.

"But For" What, Exactly?

The but-for test only works if everyone agrees on what the grid would have needed anyway, and the senators' own report suggests that is quite a lot. Tucked into its opening pages is an admission that roughly a third of US transmission and half of distribution infrastructure is operating "near or beyond its useful life." Nowhere does it estimate how much of that needed replacing with or without AI.

No case makes the point better than Three Mile Island. As we reported in March, Constellation's restart of Unit 1, a reactor that fed this same grid until 2019, ran into a "four-year-tall roadblock" when PJM said full deliverability could take until 2031.

Full output hinges on 765-kV and 500-kV transmission upgrades not expected until December 2030, and Constellation needed a FERC waiver to shift 760 MW of interconnection rights from its Eddystone plant just to try to work around them.

A reactor that can't fully reconnect to a grid it was plugged into seven years ago is a grid problem, not a data center problem.

None of this means the hyperscalers deserve a free ride. They signed the pledge, and they should honor it. But "but for the data center" is doing a lot of heavy lifting for a grid that, by the senators' own account, was already wearing out.

Then again, sending Big Tech the bill is a lot easier than explaining why the grid was falling apart before anyone had heard of ChatGPT.

Tyler Durden Tue, 10/13/2026 - 15:25
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BofA Bets On Copper And Uranium As Higher Rates Put Gold Under Pressure

2026-10-12T14:19:03.047-07:00

BofA Bets On Copper And Uranium As Higher Rates Put Gold Under Pressure

Bank of America metals and mining analyst Lawson Winder shared his latest outlook for the space in a Friday note titled, "We like copper and uranium, while rates should keep a lid on gold prices."

Winder said his desk favors copper and uranium producers as global supply constraints collide with soaring power-grid demand, supporting higher prices for these commodities. He pointed out that higher US interest rates should keep the dollar bid while weighing on gold.

On single stocks, BofA downgraded Kinross Gold to Underperform and Alamos Gold to Neutral. Freeport-McMoRan remains BofA's top copper stock, while Cameco is its top uranium pick.

For base metals, Winder said copper is the strongest industrial metal. He said constrained supply and long-term electrification demand support higher prices. His desk raised its 2026 average copper forecast by 3% to $13,278 a ton and increased its long-term estimate by 20% to $13,578, adding that prices could average $15,250 in 2027.

He lifted his Freeport price target to $87 from $80, citing progress in the Grasberg operational turnaround and prospects for production growth.

Uranium is another favorite for BofA analysts, even though they cut their 2026 average estimate for the radioactive metal used in nuclear fuel rods to about $97 a pound. They maintained their 2027 projection near $130, roughly 45% above the spot price cited in the report.

Cameco offers one of the top exposures to both uranium prices and nuclear buildout through its 49% stake in Westinghouse, the analyst said. He maintained his "Buy" rating and a $133 price target on one of the world's largest providers of uranium fuel for clean nuclear power.

Here's the full list of precious metals, industrial and base metals, and steel stocks in Winder's coverage universe:

Extended explanation of the coverage universe:

Agnico Eagle Mines (AEM)

Our $233 per share price objective is based on Agnico Eagle trading at 2.00x times our estimated NAV (current net debt position plus a mining asset DCF utilizing a 5% WACC). Historically, North American gold producers have traded between 1 and 2 times NAV, with 1.75-2.0 times being accorded to the organically growth-oriented gold producers such as AEM.

Risks of this price objective not being attained are commodity price weakness, the inability to secure financing for expansion or development projects, unforeseen operating problems, and political risk in the countries the company operates in. Upside risks are commodity price strength, better-than-forecast operating performance and favorable changes in the political environment in the regions where it operates.

Alamos Gold (YAGI / AGI)

Our price objective for Alamos Gold (AGI/YAGI) is US$36.00/C$51.00, based on the stock trading at 1.00x our estimated net asset value (NAV) and a 1.42 CADUSD FX rate. Historically, North American precious metal producers have traded between 1x and 3x NAV but more recently between 1x and 2x, with unhedged, growth-oriented producers occupying the upper end of the range and Junior and Mid-tier producers trading historically at a discount to the senior producers.

Upside risks to our PO are a higher-than-forecast gold price, a lower-than-forecast CADUSD FX rate, exploration success at Island, Mulatos and Young-Davidson, better-than-expected synergies at Magino, advantageous changes to the regulatory and/or tax regimes in the jurisdictions in which they operate, and the potential for AGI to be acquired at a premium valuation.

Downside risks are a lower-than-forecast gold price and higher-than-forecast CADUSD FX rate, risks of the Argonaut transaction not receiving regulatory approval, operational challenges with the Magino mine, risks associated with undertaken M&A (such as with respect to integration of assets), and unforeseen operating and development issues at other assets.

Alcoa Corporation (AA)

Our price objective of $48.00 for AA is based on 4.0x 2026E EV/EBITDA, 3.5x 2027E EV/EBITDA and 1.0x net asset value (NAV), with each value equally weighted. The 4.0x 2026E EV/EBITDA target multiple is below the lower end of the global aluminum producer peer average of 4-5x due to our more bearish outlook for alumina from the BofA Global Research Commodities team as well as continued overhang related to Section 232 tariffs, San Ciprian/Alumar restart and Western Australia bauxite permits. The 3.0x is also below AA's historical trading average (since 2016 separation) of 5x. The 3.5x 2027E EV/EBITDA multiple is lower than the 2026E multiple to account for time value. The 1.0x price to NAV (P/NAV) target multiple is in line with our broad NA metals and mining coverage.

Downside risks to our price objective are 1) aluminum price weakness, 2) extended delays in getting its bauxite mine approvals in Western Australia, 3) pension liabilities, 4) higher raw materials costs including electricity, oil, caustic soda, coke, and pitch, 5) power contract negotiation risk (electricity is a large cost component), 6) power disruption risk and other unforeseen weather-related risks, 7) political, regulatory and country risks, 8) unfavorable currency changes including in the BRL, CAD, EUR, ISK and NOK, and 9) the removal of protective tariffs in markets.

Upside risks to our price objective are 1) higher aluminum prices, 2) better-than-expected cost containment, and 3) global demand growth.

Almonty Industries Inc (ALM)

Our $24 price objective (PO) is based on 8.0x 2027E EV/EBITDA, 7.5x 2028E EV/EBITDA, and 1.0x P/NAV. We think the target multiples are conservative as they are discounted to critical mineral stocks that trade around 25x 2026E EV/EBITDA. At 8.0x 2027E EV/EBITDA, our target multiple would be in-line with historical trading average of the copper stocks (which we consider more industrial metal stocks but have some elements of critical mineral stocks), and a substantial discount to the current 25x trading multiple of the critical mineral stocks). Our 7.5x 2028E EV/EBITDA target multiple is a standardized (0.5x) discount to 2027E to account time value risk. While our 1.0x P/NAV target multiple is typical for copper and critical mineral stocks, it does reflect a substantial discount to where both groups are now trading.

Upside risks to our PO are higher than expected tungsten prices (whether accelerating demand or continued supply challenges), weaker local currencies than expected that reduce USD operating costs (i.e. EUR, KRW), the build-out of key projects that are not included in our current forecasts (Los Santos, Valtreixal, Gentung), and the potential for ALM to become the subject of an acquisition.

Downside risks to our PO are lower than expected tungsten prices (whether slowing demand or greater than expected supply), stronger local currencies than expected that increase USD operating costs (i.e. the EUR and KRW), and operational challenges.

Aura Minerals (AUGO / XEDTA)

Our price objective for Aura Minerals is US$101.00 and R$169.00 per share, and is based on the stock trading at 1.35 times our estimated net asset value (NAV). Our NAV is based on a 5% discount rate and a long-term gold price of $3,500/oz. In recent history, North American precious metal stocks have traded between 1 and 2 times NAV, with unhedged, growth-oriented producers with solid balance sheets occupying the upper end of the range. Our 1.35x NAV for AUGO is at a premium to the average of Intermediate/Junior (Jr) peers in our coverage to recognize its peer leading production growth profile.

Upside risks to our price objective are stronger-than-forecast commodity prices, lower than expected costs, positive regulatory, permitting or operating developments and significant success in exploration.

Downside risks to our price objective are unforeseen operating problems, political, legal or permitting challenges in the regions in which the company operates, rising capital and operating costs, and delays in the development of its growth projects.

FX and controlling shareholder influence could be risks in either direction.

B2Gold Corp (YBTO / BTG)

Our price objective for B2Gold (BTG/YBTO) is US$3.75/C$5.25 based on the stock trading at 0.75x our estimated net asset value (NAV). Historically, North American precious metal stocks have traded between 1.0x and 3.0x NAV and between 1.0x and 2.0x more recently with a median of 1.25-1.50 times, with unhedged, growth-oriented producers occupying the upper end of the range. We use a 0.75x NAV multiple for BTG vs. mid-tier gold producer peers' target multiples at 0.75x-1.25x given higher execution risk.

Downside risks to our BTG valuation are: 1) political risk from Mali 2) mine plan estimates in excess of BTG reserves, 3) lack of commodity diversification, 4) mine plans that are based on outstanding permits or approvals, 5) unfavorable changes in currencies, 6) unforeseen increases in in put costs such as the price of oil and labor, 7) the possibility it could lose its social license to operate at any of its mines or projects 8) potential cuts to the dividend or reduced capital return and 9) issues with the ongoing construction and ramp-up of the Goose project. Upside risks are a higher gold price, the possibility for BTG to be acquired and unexpected exploration success. 10) Our gold price forecast is also a risk to our BTG valuation/forecasts.

Barrick Mining (B)

Our price objective (PO) for Barrick Gold is $58.00 per share and is based on the stock trading at 1.25x our estimated net asset value (NAV). Historically, North American precious metal stocks have traded between 1 and 3 times NAV, with unhedged, growth-oriented producers with assets located in relatively geopolitically stable regions occupying the upper end of the range. Preventing us from assigning a higher target P/NAV multiple is Barrick's stable gold output. Downside risks to our price objective are: commodity price weakness, the inability to secure financing for expansion or development projects, unforeseen operating problems, political or legal challenges in the regions in which the company operates, rising capital and operating costs and delays in the development of its growth projects. Upside risks are stronger than expected commodity prices, better than expected production and cost control.

Cameco Corporation (YCCO / CCJ)

Our C$190 ($133) PO is based on 1.0x our NAV and 35.0x 2026E & 34.5x 2027E EV/EBITDA (all 3 equally weighted). We use a CADUSD FX rate of 1.42. The 35.0x 2026E EV/EBITDA is above its long-term average of c.15x, but below the long-term peak of c.40.0x that occurred when nuclear energy growth was last very strong. The 34.5x for 2027E is a slight discount to 35.0x used for 2026E given time-related risk. The 1.0x P/NAV is above the longer-term average of c.0.9x but below peak of 1.35x. We think 1.0x is justified given Cameco's world-class tier one assets in favorable jurisdictions (Canada) & potential exploration upside partially offset by voluntary idling of one of those tier-one assets (but is in the process of restarting).

Downside risks: 1) slower-than-expected global energy demand growth, 2) continued push-out of a Japanese nuclear fleet restart, 3) any worsening in sentiment toward nuclear or more favorable sentiment toward alternative power fuel sources, and 4) any production problems at Cameco's only operating mine, Cigar Lake.

Upside risks: 1) additional potential mine disruptions that may further improve supply-demand dynamics, 2) better pace of reactor development in key future demand countries (China, Japan, and India), 3) more stringent carbon emissions restrictions in key countries, encouraging nuclear power as an environmentally friendly base line energy source, 4) a material rise in natural gas prices making nuclear power generation competitive in the US.

Centerra Gold (YCG / CGAU)

Our price objective for Centerra Gold is C$22.75 per share and US$16.00 per share, based on the stock trading at 0.75x our estimated net asset value (NAV). Historically North American precious metal stocks have traded between 1 and 3 times NAV, with a median of 1.50 times over the past nine years (and 2.00 times longer-term), with unhedged, growth-oriented producers occupying the upper end of the range.

Downside risks to our price objective for Centerra Gold are commodity price weakness, delays in the development of its growth projects and the potential for additional operating issues at Öksüt. Upside risks to our price objective are gold and molybdenum prices rising, unexpected exploration success at any of the assets, and a favorable renegotiation of its gold/copper stream on Mt. Milligan.

Centrus Energy Corp. (LEU)

Our price objective (PO) of $167 per share is derived based on 2.5x our estimated net asset value (NAV). The 2.5x 2026E NAV target multiple is a premium to the nuclear fuel supply peers to account for barriers to entry, its emerging next generation nuclear fuel growth business, strong enrichment market fundamentals to which its peers have minimal exposure, and U.S. government support, that is now being realized via the early 2026, $900m DoE funding award.

Downside risks are:1) lower than forecast enrichment pricing, 2) loss of access to enriched uranium product, 3) unexpected restrictive regulatory changes, possibly including sanctions, 4) shipping disruptions, and 5) technical disruptions.

Upside risks are: 1) higher than forecast enrichment pricing, 2) unexpected government financial and/or regulatory support, 3) a potential acquisition, and 4) faster than expected deployments of small and advanced modular reactors.

Cleveland-Cliffs (CLF)

Our $14.00 PO is based on 7.0x 2026E EV/EBITDA, 6.5x 2027E EV/EBITDA and 1.0x net asset value, with each value equally weighted. The 7.0x 2026E EV/EBITDA target multiple is higher than its historical trading average of 7.4x and is more in line with that of its key steel peers given an emerging recovery in US auto production and CLF's substantial automotive exposure relative to public peers.

Downside risks: 1) new capacities pressuring steel prices & margins, 2) obsolescence of its capacity relative to newer supply forcing closures, 3) higher-than-expected capex or interrupted operations to address older mills or environmental liabilities, 4) union representation may keep labor costs high relative to peers, 5) underfunded pension/health care position & high leverage, 6) risks to auto sector demand, including switching to aluminum & alternative materials, 7) higher imports and/or, 8) changes to trade policy.

Upside risks: 1) better steel demand than we anticipate, 2) steel price outperformance, especially if driven by raw materials as CLF is largely vertically integrated, 3) Further reduction in underfunded pension & OPEB liability, 4) resumption of the dividend, 5) better auto negotiating position for longer, and 6) sustained/higher barriers to imported steel. 6) More earnings accretion from agreement with major global steel producer.

CMC (CMC)

Our $78 per share price objective for Commercial Metals (CMC) is based on a blended 6.5x FY26E EV/EBITDA, 6.0x FY27E EV/EBITDA and 1.0x our NAV. The 6.5x 2026E EV/EBITDA target multiple is higher than its historical trading average of 6.1x to reflect the market rerating. However, the 6.5x multiple is below the target multiples used for other mini-mill peers (7.5x-8.0x) given its less diverse products / end-markets. This is partly offset by CMC's leverage to infrastructure (which is set to see strong growth from a significant increase in federal spending) and reshoring demand.

Upside risks to our price objective are: 1) better-than-expected construction / reshoring demand, 2) higher steel pricing, 3) better-than-expected pricing power in global long products that support pricing and limit imports, 4) additional trade relief, 5) cash deployment for organic or inorganic growth.

Downside risks to our price objective are: 1) sluggish demand due to delay in federal funding and/or tightened credit availability for private projects, 2) lower steel pricing, 3) execution risk related to Tensar and new micro-mills, 4) any rollback of trade relief, particularly related to Section 232, 5) threat of lower priced imports and 6) potential medium term oversupply from various new entrants in the domestic rebar market.

Eldorado Gold (EGO / YELD)

Our price objective of $51.00 (C$72.00) is based on the stock trading at 1.25x times its estimated net asset value (NAV). Historically, North American precious metal stocks have traded between 1 and 3 times NAV over the last five years, with a median of 1.50 times (and 2.00 times longer-term) and with unhedged, growth-oriented producers occupying the upper end of the range. We value EGO below the lower end of the valuation range due to higher political risk for operating in Greece and Türkiye.

Downside risks to our price objective for Eldorado Gold are commodity price weakness, the inability to secure financing for expansion or development projects, unforeseen operating problems, political, legal or permitting challenges in the regions in which the company operates, rising capital and operating costs and delays in the development of its growth projects.

Upside risks are a higher-than-expected gold price, a more hospitable regulatory environment in the jurisdictions where the company operates (in particular, Greece), more favorable foreign exchange rates than now projected, and better-than-expected operational results.

First Quantum Minerals (YFM / FQVLF)

Our C$44.00 and US$31.00 price objectives are based on a 9.5x 2026E EV/EBITDA, 9.0x 2027E EV/EBITDA, and 1.00x our NAV estimate, reflecting the long-term value of the suspended Cobre Panamá mine (we assume mine restarts in late-2027E) and the steps taken to strengthen the balance sheet.

Upside risks are stronger than forecast copper prices, early resumption of FM's development projects (Cobre Panamá), favorable local currency changes that lower USD costs, and the potential for First Quantum to become an acquisition target.

Downside risks to our PO are a weaker-than-expected global economy that could impede metal demand growth expectations, affecting our commodity price forecasts. In addition, sovereign risks in Zambia (i.e., challenging geopolitical environment, developing infrastructure) and Panamá (mining a newer industry), ramp-up issues at Cobre Panamá, stronger than forecast local currencies that increase USD costs, labor action, and weather could also impact our FM valuation and PO.

Franco-Nevada (YFNV / FNV)

Our price objective for Franco-Nevada is C$398 (US$280) per share, based on the stock trading at 2.65x our estimated net asset value (NAV) on a cash-adjusted basis and a USD/CAD FX rate of 1.42x. Historically, North American precious metal streaming stocks have traded between 1.50 and 3.50 times NAV, with growth oriented streaming companies at the top end. Based on its strong balance sheet and low-cost asset base, we believe Franco-Nevada deserves a premium multiple. Franco-Nevada also benefits from an experienced management team.

Upside risks to our PO are substantially higher commodity prices, higher-than-expected output at the royalty assets, and/or higher reserves.

Downside risks are commodity price weakness and unforeseen operating problems at the mines on which its royalties are based.

Freeport-McMoRan (FCX)

Our $87.00 per share price objective blends 11x 2026E, 10.5x 2027E EV/EBITDA and 1.0x our net asset value (NAV). The EV/EBITDA target multiples are above the 8.0x historical average for copper producers covered by BofA Global Research to reflect the impact from temporary lower volumes at Grasberg and our bullish view for Copper. Our P/NAV multiple of 1.0x is in line with most of the copper producers covered by BofA Global Research but is arguably conservative given several potentially value-enhancing growth options that we do not currently model. These include a new mill at El Abra, a mill expansion at Bagdad and low-grade leaching.

Downside risks to our price objective are 1) global economic weakness, 2) Operating disruptions, 3) execution risk at its cost-cutting or expansion programs, 4) stricter or unfavorable regulatory or environmental regulations, particularly at its Indonesian operations, 5) other factors pressuring prices of the commodities it produces and 6) unfavorable currency moves.

Upside risks are 1) better-than-expected copper and gold prices, 2) a more accommodating operating environment in Indonesia and 3) further cost-cutting progress.

Hudbay Minerals (YHBM / HBM)

Our C$45.50 (US$32.00) per share price objective for Hudbay Minerals (YHBM/HBM) is based on a 8.5x 2026E EV/EBITDA multiple, 8.0x 2027E EV/EBITDA multiple and 1.0x our net asset (NAV) estimate, weighted equally to each. Since 2005, the global copper producers have traded in an EV/EBITDA range from 2.0x to 13.0x with HBM trading at a discount. For HBM, we use a below peer target multiple given a less diverse asset base than average (just two copper mines and one gold mine) partly offset by stronger average jurisdictional exposure.

Upside risks are stronger-than-forecast copper prices, favorable local currency changes that lower USD costs, the receipt of all permits for Rosemont with no legal challenges, a sooner than expected start of mining of the Pampacancha satellite deposit and the potential for HBM to be targeted for acquisition.

A downside risk to our PO is a weaker-than-expected global economy that could impede metal demand growth expectations, affecting our commodity price forecasts. Other downside risks are a delay in attaining surface access rights at Pampacancha, the political and regulatory climate in the jurisdictions in which HBM operates (Canada, Peru and the USA), stronger than forecast local currencies that increase USD costs, increases in general operating and development costs, labor action, weather and the inability to attain the needed permits to develop Rosemont, M&A risk.

IAMGOLD Corp. (IAG / YIMG)

Our price objective for IAMGOLD is US$22.00/C$31.50 per share, and is based on the stock trading at 1.35x times our estimated net asset value (NAV) and a 1.42 CADUSD exchange rate. Historically, North American precious metal stocks have traded between 1.50 and 3 times NAV, with a median of 2.00 times over the long-term, and with unhedged, growth-oriented producers with solid financial positions and low relative costs and located in stable mining jurisdiction occupying the upper end of the range. We ascribe a moderate P/NAV multiple to IAMGOLD to reflect our forecast for higher than average political risk in Burkina Faso, execution risks at the Cote Gold project, and higher cash costs and debt vs. peers. As the Cote Gold project in Canada ramp-ups, this should drive strong volume growth, lower costs and political risk, and ultimately drive deleveraging.

Upside risks: Gold price could surprise to the upside vs. our expectation. Potential positive developments in terms of exploration results and project execution.

Downside risks: Gold price could surprise to the downside vs. our expectations. Risks on project capital cost over-runs / schedule disappointment. We also consider the risk for unfavorable political developments, particularly in higher perceived political risk jurisdictions such as Burkina Faso.

Ivanhoe Mines (YIVN / IVPAF)

Our C$13.50 (US$14.50) price objective is based on 1.10x our net asset (NAV) estimate. The 1.10x price to net asset value (P/NAV) target multiple is at a modest premium to the current trading multiples of global copper producers to reflect its superior production growth, low relative unit costs, a strong balance sheet and solid copper optionality with the 100%-owned Western Foreland property.

Upside risks to our PO are stronger-than-forecast copper prices, faster-than-expected ramp-up of IVN's development projects (in particular, Kamoa-Kakula), the discovery of new mineral resources that become mining projects (Western Foreland has this potential), favorable local currency changes that lower USD costs, participation in the M&A backdrop

Downside risks to our PO are a weaker-than-expected global economy, jurisdictional risks in the Democratic Republic of Congo (DRC) and South Africa (i.e., tax regime changes, mining policy shifts, poorly defined legal frameworks, difficulty in obtaining social license, etc.), ramp-up issues at Kamoa-Kakula, input cost inflation, stronger-than-forecast local currencies that increase USD costs, labor action, and weather.

Kinross Gold (KGC)

Our price objective for Kinross Gold is $24.75 per share, and is based on the stock trading at 1.25 times our net asset value (NAV) estimate, reflecting production growth that is forecast to be slightly lower than the senior/mid-tier average. Historically, North American precious metal stocks have traded between 1 and 3 times NAV, with companies with declining production at the lower end of the range.

Risks to our price objective for Kinross Gold are commodity price weakness, the inability to secure financing for expansion or development projects, unforeseen operating problems, political or legal challenges in the regions in which the company operates, rising capital and operating costs and delays in the development of its growth projects or current mine expansions. On the upside, risks are stronger than expected commodity prices and an operating turnaround that exceeds our expectations in terms of timing and magnitude, and exploration success.

Lundin Mining Corp (YLUN / XLPRF)

Our C$45.00, US$33.00 and SEK304 per share price objectives for Lundin Mining are based on 11.5x and 11.0x EV/EBITDA multiples applied to our 2026E EBITDA and 2027E EBITDA and 1.0x applied to our net asset value (NAV) estimate. We apply a USDCAD FX rate of 1.42 and a USDSEK FX rate of 9.14. Since 2005, the global base metal producers have traded in an EV/EBITDA range from 2.0x to 13.0x, with Lundin trading at a discount to the average due to it being a smaller company. However, we see potential for a re-rating as LUN executes on its growth strategy including its transformative Vicuña project.

Downside risks to our PO are worse-than-expected economic performance that could impede our metal demand expectations, impacting our commodity price forecasts. In addition, development and/or permitting delays, stronger than forecast local currencies that increase USD costs, worker strike action, several possible technical missteps and weather could also impact our Lundin valuation and PO.

Upside risks are higher-than-forecast commodity prices as well as weakening local currencies, substantial exploration success leading to longer mine lives and/or higher margin ounces, the potential for LUN to become an acquisition target.

Lundin Mining Corp (LUNMF)

Our C$45.00, US$32.00 and SEK304 per share price objectives for Lundin Mining are based on 11.5x and 11.0x EV/EBITDA multiples applied to our 2026E EBITDA and 2027E EBITDA and 1.0x applied to our net asset value (NAV) estimate. We apply a USDCAD FX rate of 1.42 and a USDSEK FX rate of 9.14. Since 2005, the global base metal producers have traded in an EV/EBITDA range from 2.0x to 13.0x, with Lundin trading at a discount to the average due to it being a smaller company. However, we see potential for a re-rating as LUN executes on its growth strategy including its transformative Vicuña project.

MP Materials (MP)

Our $85 PO assumes a 25x multiple on our 2029E EBITDA, discounted back to today's money using MP's weighted average cost of capital of around 7.0%. The 25x multiple assigned is below its own historical average (of 34.2x) but in-line with its 2020-2024 average of 25.2x. The higher multiple vs peers recognizes 1) reduced execution risk, 2) expansion potential, 3) rising strategic premium, 4) and explicit Department of Defense (DoD) support. As the only integrated rare earth and magnetics producer in the Western Hemisphere, we continue to see MP as a unique investment vehicle for exposure. We are medium to long-term bullish neodymium-praseodymium (NdPr), MP's key upstream product.

Upside risks: 1) stronger EV and wind generation demand, 2) scarcity of other rare earths investment vehicles, 3) likely first-mover advantage in the vertical integration opportunity, 4) barriers to entry (Stage I and II), 5) potential for additional U.S. government financial support, 6) possible more collaborations with major EV makers, 7) the possibility that MP could be acquired, and 8) higher than expected rare earths pricing.

Downside risks: 1) execution of Stage II and III and cost containment, 2) higher China supply quotas, 3) new entrants, particularly outside of China., 4) increased competition in Stage III, 5) limited clarity on Stage III profitability, 6) rare earth magnet substitutes, and 7) slower EV adoption hurting demand.

Newmont Corporation (NEM / XNCRF)

Our price objective for Newmont is $139 (A$200) per share, and is based on the stock trading at 1.75x times our estimated net asset value (NAV). We assume a USDAUD exchange rate of 1.47. Our NAV is based on a 5% discount rate and a long-term gold price of $3,500/oz. Historically, North American precious metal stocks have traded between 1 and 3 times NAV, with a median of 1.50 times over the past three years (2.00 times longer-term), and with unhedged, growth-oriented producers with solid balance sheets occupying the upper end of the range. In the great gold rally of 2011, NEM's multiple peaked at 2.50x.

Upside risks to our price objective are stronger-than-forecast commodity prices, better than expected success at reducing costs and positive regulatory, permitting or operating developments. Downside risks to our price objective for Newmont are the inability to secure financing for expansion or development projects, unforeseen operating problems, political, legal or permitting challenges in the regions in which the company operates, rising capital and operating costs and delays in the development of its growth projects.

Nexa Resources (NEXA)

We have removed the investment opinion on the company's stock. Investors should no longer rely on our previous opinion or price objective.

Nucor (NUE)

Our price objective of $300 per share is based on 9.0x 2026E EV/EBITDA, 8.5x 2027E EV/EBITDA and 1.0x NAV, with each value equally weighted. The 9x 2026E EV/EBITDA target multiple is above its historical average of 7.3x to reflect potential upside from higher spot pricing and its highly variable cost structure, diversified product mix, strong volume growth potential (from multiple projects underway) and investment grade balance sheet with a disciplined capital return policy (minimum of 40% of net income).

Downside risks to our price objective are: 1) lower steel price and higher scrap costs squeezing margins, 2) weaker than expected demand especially in construction markets, 3) project start-up delays and cost overruns, and 4) M&A's which could be dilutive in the near-term.

Upside risks to our price objective are: 1) higher than expected steel prices, 2) lower than expected input costs, 3) lower import volumes, 4) more favorable trade policies, and 5) a stronger than expected economy.

Pan American Silver (PAAS)

Our price objective for Pan American Silver is $57.00, and is based on the stock trading at 1.75x our estimated net asset value (NAV) on a net investments-adjusted basis (i.e. the 1.75x multiple is applied to the asset value and then the value of the equity investments is added to that with an effective 1.0x multiple applied). Our NAV is based on a 5% discount rate for all assets, except Escobal for which we use 7.5%. Historically, North American precious metal stocks have traded between 1 and 3 times NAV, with silver producers generally trading at a discount to gold producers.

Upside risks to our price objective are higher than expected commodity price forecasts, a change in the regulatory/permitting environment in the Chubut province of Argentina where Pan American's dormant Navidad project is located, operating results that exceed expectations and lower than expected capital costs.

Downside risks to our price objective are unforeseen operating issues, realized commodity prices that are below our forecast, regulatory issues (including tax, environmental and permitting) that cause financial results to differ from our forecast, and higher than expected capital costs.

Reliance, Inc. (RS)

Our $405 per share price objective for Reliance Inc. (RS) is based on 11.5x 2026E EV/EBITDA, 11.0x 2027E EV/EBITDA and 1.0x NAV, with each value equally weighted. The 11.5x 2026E EV/EBITDA target multiple is above its historical trading average of 8.3x to account for improved business model with higher long-term sustainable gross profit margin of 29-31% versus 25-27% in 2015/16 and potential growth through M&A.

Downside risks to our price objective are: 1) a sharp correction in prices (carbon steel, stainless and aluminum), 2) weaker than expected macro, leading to lower metal demand, 3) higher imports and 4) execution risk related its acquisition strategy.

Upside risks to our price objective are: 1) aggressive buybacks or dividend increases, 2) higher metal prices, 3) more attractive consolidation opportunities and 4) a better demand environment.

Royal Gold (RGLD)

Our price objective for Royal Gold is $222 per share, which is based on the stock trading at 2.00x our adjusted net asset value (NAV), valuing net cash cost 1:1. Our net asset value (NAV) is based on a 5% discount rate. Historically, North American precious metal stocks have traded between 1 and 3 times NAV, with unhedged, growth-oriented producers occupying the upper end of the range. Given Royal Gold's status as a royalty company as opposed to an operator, our target valuation multiple reflects its good cash flow-generating ability.

Upside risks to our PO are substantially higher commodity prices, higher-than-expected output at the royalty assets, and/or higher reserves at the royalty assets. Downside risks are a weaker gold price, problems at the operations, and no exploration success.

SSR Mining Inc. (SSRM / YSSRM)

Our price objective for SSR Mining is $40.00 (C$56.00) per share, and is based on 1.25x our adjusted estimated net asset value (NAV). Our NAV is based on a 5% discount rate (consistent with the vast majority of gold operations within our North American precious metals coverage) and long-term gold price forecast of $3,500 per ounce. Historically, North American precious metal stocks have traded between 1 and 3x NAV, with a median of 1.00x over the past three years (2.00x longer-term). Our target multiple reflects the enormous uncertainty surrounding the outcome of the heap leach pad slide at the Copler mine balanced by stronger North American operations.

Upside risks to our price objective are stronger-than-forecast commodity prices, better-than-expected success at reducing costs and positive regulatory, permitting or operating developments.

Downside risks to our price objective for SSR are the inability to secure financing for expansion or development projects, unforeseen operating problems, political, legal or permitting challenges in the regions in which the company operates, rising capital and operating costs and delays in the development of its growth projects.

Steel Dynamics (STLD)

Our $270 per share price objective for Steel Dynamics (STLD) is based on 8.5x 2026E EV/EBITDA, 8.0x 2027E EV/EBITDA and 1.0x NAV, with each value equally weighted. Our 8.5x target EV/EBITDA multiple is higher than its historical trading average of 6.6x to reflect potential upside from higher spot pricing and its industry leading utilization rate, highly variable cost structure, leading value-add product portfolio, investment grade balance sheet and unique exposure to higher margin downstream business via its aluminum rolling mill. At spot pricing, the implied valuation multiple is closer to 8.0x, still high historically.

Upside risks to our price objective are: better than expected macro leading to stronger steel pricing and spreads than we forecast, continued Fabrication tailwind, aggressive shareholder returns, more protective trade policy, and lower imports.

Downside risks to our price objective are: lower steel and metal spreads, project delays, lower than expected demand, higher imports, and excess industry supply.

Teck Resources (YTECK / TECK)

We have removed the investment opinion on the company's stock. Investors should no longer rely on our previous opinion or price objective.

Triple Flag Precious Metals Corp. (YTFPM / TFPM)

Our C$53.00 ($37.00) per share PO for TFPM is based on a target valuation multiple of 2.00x our estimated NAV. The multiple is a slight discount to the senior royalty & streaming peers giving consideration to TFPM's smaller market cap and liquidity, and less diversification by geography, commodity and operator, partly offset by above average margins and attributable GEO production growth. The multiple is at the high end of the range for the gold producer peers given the attractive relative investment characteristics of the royalty & streaming business model (precious metals exposure with insulation from opex and capex inflation and upside from production growth and exploration success.

Our NAV estimate is based on a 5% real discount rate and long-term gold and silver prices of $3,500/oz and $42.00/oz (starting in 2031E).

Downside risks to our PO are: 1) a lack of input the operation of portfolio assets, 2) competition from a growing royalty and streaming sector 3) precious metal price volatility, 4) asset investments in non-investment grade emerging markets, 5) concentrated ownership structure, 6) ramp up delays at development projects.

Upside risks are: 1) higher than expected gold and silver prices, 2) future exploration discoveries and unexpected expansions at mines in the portfolio, 3) a potential acquisition of TFPM.

Wheaton Precious Metals (WPM)

Our price objective for Wheaton is $169.00 per share, and is based on the stock trading at 3.25x times our estimated net asset value (NAV). Our NAV per share is based on a 5 percent discount rate. Historically, North American precious metal stocks have traded between 1 and 3 times NAV, with a median of 2.00 times longer-term (1.50 times in the last three years), and with royalty/streaming companies occupying the upper end of the range.

Risks to our price objective for Wheaton are continued commodity price weakness, unforeseen operating problems at the mines on which its silver streams are based, financing challenges, political or legal challenges in the regions in which the mines operate, and delays in the development of projects for which the company silver streams.

Professional subscribers can read the full metals note here at our new Marketdesk.ai portal.

Tyler Durden Mon, 10/12/2026 - 13:35
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Trump Declares Ukraine Energy Ceasefire; Zelensky Says "News To Me" As Russia Attacks Powerplant

2026-10-11T21:19:17.522-07:00

Trump Declares Ukraine Energy Ceasefire; Zelensky Says "News To Me" As Russia Attacks Powerplant

US relations with Ukraine are once again spiraling fast, especially following President Trump's 'shock' declaration Saturday while addressing Zelensky's anger at the diesel deal with Russia, "I suggest they get a new leader who can make a deal… And I think it's time for Ukraine to get a new president."

The rebuke had been in response to Zelensky blasting the diesel arrangement as "not fair and not honest" and a "sign of weakness" by Trump, and a "birthday gift" to Putin.

And then on Sunday morning, again to the great surprise of Western allies, Trump announced on social media a new energy ceasefire between Ukraine and Russia - except that Kiev quickly said it knows of no such ceasesfire.

"Effective immediately, there is an ENERGY CEASEFIRE in the War between Russia and Ukraine," Trump wrote on Truth Social. "Both parties have agreed. Do not break it!"

More reported blackouts in Kiev Sunday evening, via AFP.

The last such energy ceasefire attempt announced by Trump was in mid-September, but it didn't hold and in fact collapsed rather quickly after. In reality it never so much as got off the ground, before both sides were back at hammering each other's oil, gas, and electricity infrastructure.

Very soon after this latest announcement by Trump on Sunday, Zelensky told US media that it was "news to me". He said to Axios while reacting to Trump's Truth Social post: "If President Trump negotiated it with Putin, please tell us when the ceasefire begins. We are ready, and we will accept it."

And yet the dilemma for Kiev remains: it is vehemently against a US-Russian diesel deal, but any pause in energy attacks would serve to protect that very deal.

This unusual and very public back-and-forth is happening as the Ukrainian capital has been plunged into darkness:

BLACKOUT leaves parts of Kiev in total darkness Mayor’s urged people to LEAVE city 'temporarily' as capital forced into 'survival mode' https://t.co/nAq2f7CKLp
— RTVisual (@RT_Visual_on_X) October 11, 2026

Zelensky has in follow-up said on X that he was "awaiting details from the American side" - and has also complained that Russia has continued hitting Ukraine's energy sites on Sunday. According to more of the latest from Zelensky:

Volodymyr Zelensky has accused Russia of striking a power plant in Kyiv after Donald Trump announced an "energy ceasefire".

The Ukrainian president says in a post on X that he has briefed Trump on the "brutal Russian strikes that continue unabated". He says earlier "the Russians struck a power plant in Kyiv with a 'shahed' drone, and many districts experienced power outages".

"Later, there were strikes on energy facilities in the Kharkiv region. And all of this happened AFTER the President of the United States made his statement about an energy ceasefire," he says.

His fresh video address:

Today, there was a statement from the President of the United States that an energy ceasefire has been secured. This is good news for everyone – and it is important that it become reality. Unfortunately, Ukrainian skies have been infested with Russian “shaheds” all day today. There have been glide bomb strikes and strikes on our energy infrastructure too. A power plant in Kharkiv was attacked this evening. Overall, this past week alone, the Russians have carried out more than 200 strikes on our electricity generation and transmission facilities in Ukraine, and another 17 strikes this week targeted gas and oil facilities. They have killed more than 150 of our people, and more than 700 people have been wounded. Ukraine has proposed many de-escalatory steps. Putin had one answer to all of them – “nyet.” We do hope that he will finally say something to America, Ukraine, and the entire world that will lead to a real and dignified peace. Ukraine wants peace. The question is whether Russia does. The Armed Forces of Ukraine have received all the appropriate orders. We are awaiting clear details of the dialogue between America and Russia – and we expect Putin to follow through on what President Trump said.
— Volodymyr Zelenskyy / Володимир Зеленський (@ZelenskyyUa) October 11, 2026

Meanwhile Washington still has considerable leverage over Ukraine, putting Zelensky between a rock and a hard place. The Trump White House can always block weapons and funds - something it has previously threatened to do but never pulled the trigger on.

Fresh reporting in Financial Times is already putting specifics on the table to be potentially revoked:

SCOOP @FT: The Trump administration is threatening to stop the PURL procurement system that provides Ukraine with weapons in order to press Kyiv to halt its deep strikes on Russian energy infrastructure, according to officials in Europe. The officials, who received calls from American officials on Saturday and Sunday or were briefed on them, said the US was lobbying European capitals and Kyiv in an attempt to end the attacks on Russian oil refineries. The White House declined to confirm or comment on the calls. w/ @HenryJFoy @ahauslohner https://t.co/0dwv7GovPf
— Christopher Miller (@ChristopherJM) October 11, 2026

American diplomats are said to be currently lobbying ⁠European capitals to pressure Ukraine end the attacks on Russian oil refineries:

The message from the US included threats to cut off intelligence sharing and Purl (the Prioritised Ukraine Requirements List) mechanism for procuring US weapons ‌for ⁠Ukraine, the report added.

One official who was given a message from a Pentagon official stated: "They are calling Kyiv . ... They are calling everyone [in Europe]" in order to lean on them.

* * *

Tyler Durden Sun, 10/11/2026 - 15:00
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UBS Sees Copper As "Highest-Conviction" Theme, Names Four Miners To Ride Supply Squeeze

2026-10-10T15:19:41.065-07:00

UBS Sees Copper As "Highest-Conviction" Theme, Names Four Miners To Ride Supply Squeeze

Copper futures in London closed near record highs to end the week, as desks at JPMorgan and Deutsche Bank have recently warned that dwindling global supplies of the industrial metal could produce another leg higher.

Théa Ziegler, a member of UBS' US equity advisory sales team, wrote in a note on Friday afternoon that "copper remains one of the highest-conviction commodity themes."

Ziegler said demand from electrification and data-center construction is expected to outpace supply growth and support high prices, as hopes for lower prices fade in a theme best described as scarcity.

"Copper remains one of the highest-conviction commodity themes, with electrification, data-center buildouts and persistent supply constraints continuing to support a constructive long-term outlook. The key takeaway for investors is that supply growth is expected to lag demand growth for several years, underpinning elevated copper prices despite near-term uncertainty around tariffs and trade policy," Ziegler said.

Natalia Corfield, JPMorgan's head of Latin America corporate credit research, noted new developments this week from South America and warned that a strike at Centinela, a major source of Antofagasta's copper production in Chile, has begun and could soon impact production.

Separately, Bloomberg cited the two unions behind the labor action, which warned that Centinela could begin reducing copper production within about two weeks if the walkout continues.

Add major producer Chile's copper woes to the scarcity theme. Deutsche Bank's head of metals research, Daniel Ghali, warned last month that global copper inventories have fallen to "unprecedented lows," blaming some of that on US and Chinese stockpiling, which is squeezing supplies elsewhere.

Ghali has a new 2Q27 price target for copper in London of $22,050 a ton.

Here's the chart that shows the copper supply gap that will persist into the early 2030s.

UBS's Ziegler concluded: "Against that backdrop, the team continues to favor copper-linked miners with meaningful leverage to the theme. Preferred exposures include Freeport-McMoRan, First Quantum, Hudbay and Teck Resources, all of which are viewed as well positioned to benefit from what is expected to be a multi-year copper upcycle driven by structural demand and a constrained supply response."

Tyler Durden Sat, 10/10/2026 - 18:05
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Spot Is Four Times The Hurdle: What $50 Billion-A-Gigawatt Neocloud Rents Say About The AI Revenue Gap

2026-10-10T15:19:35.129-07:00

Spot Is Four Times The Hurdle: What $50 Billion-A-Gigawatt Neocloud Rents Say About The AI Revenue Gap

In the AI trade, everyone wants to know what a gigawatt is worth.

Thanks to a chart buried on page 7 of Goldman's latest SpaceX note, we now have an answer, or rather three of them: $40-50 billion a year if you rent it out short-term, $20-30 billion if you rent it out long-term, and roughly $12 billion if you're a hyperscaler who simply needs to earn a decent return on it. The gap between those numbers is where the entire debate over AI revenues, and the $1+ trillion a year of capex now chasing them, really lives.

Here is the chart in question, from Goldman internet analyst Eric Sheridan's Q3 preview of SpaceX (SPCX) published on Monday (available to pro subs):

Source: Goldman

The navy bars are short-term capacity deals, the light blue ones are long-term hosting contracts. And the message is unambiguous: right now, compute is so scarce that whoever owns a powered, GPU-filled data hall can name their price... as long as the buyer only has to commit for a few months.

Regular readers know we have been warning since last October that the AI buildout runs on debt, and more recently that it runs on revenue numbers nobody can quite pin down. Below we walk through what the neocloud rate card tells us about the economics of AI compute, why it can't be extrapolated to the rest of the buildout, and where the tension between neocloud revenue, hyperscaler revenue and actual end-user revenue lies.

The Rate Card: Spot $50, Term $20

Start with what Goldman actually found. SpaceX, which now houses xAI's Colossus compute, announced two more hosting deals in the past quarter (one on its Q2 call, one at Goldman's own Communacopia conference in September), and told investors they are "monetized at the high end of the ~$30-50bn/GW range" it has historically discussed. And SpaceX is not alone:

Nebius (NBIS...) disclosed in August that short-term capacity deals in Q3 are being priced at ~$40-50bn/GW while CoreWeave (CRWV...) disclosed similar ~$40bn/GW pricing for its recent short-term capacity deals... Longer-term capacity deals across the industry continue to vary by company but pointing to ~$20bn/GW as a sustainable pricing floor at current rates. IREN (IREN...) disclosed in August that recent 3-year contracts are being priced at >$20bn/GW with active discussions at ~$25bn/GW, while NBIS disclosed longer-term deals being priced at similar ~$20-25bn/GW rates.

Deutsche Bank's Edison Yu goes even further. In his "Got compute?" note (also available to pro subs), Yu backs out the GPU-hour pricing of each SpaceX deal and gets $50-51 million per MW for Google and Reflection AI, and $60-61 million per MW for the two undisclosed customers, i.e., as much as $61 billion per gigawatt, renting out GB300s at nearly $14 an hour:

Source: Deutsche Bank

Put differently, the term structure of AI compute is steeply inverted: buyers pay roughly double for the privilege of not committing. That is what a market looks like when demand is real but nobody (including the buyers) is willing to bet on it lasting. Physical commodity traders will recognize the shape: it's backwardation, and it usually means the shortage is priced as temporary.

It also explains why the neocloud model is so attractive to its owners. Goldman's hyperscaler work puts all-in capex at roughly $42 billion per GW (more on that below). At $40-50 billion a year of revenue, a neocloud recoups the entire build in about one year of rent; at the $20 billion long-term floor, it takes two. Which is why the next detail matters so much:

One caveat to highlight is the duration risk of these hosting deals - with most of these deals being 90-day cancellable on both sides, there is some risk that our assumption for revenues to be recognized at current rates through contract expiry (2029 in most cases) is overly-bullish.

Translation: the $50 billion-a-gigawatt revenue stream that SpaceX is trying to borrow $40 billion against is, contractually, a quarterly lease. We made the same point when SpaceX went looking for a record $40 billion in chip-collateralized SPV debt last week; Goldman has now put a number on it. In its model, hosting/IaaS revenue goes from $1 billion in 2Q26 to more than $10 billion a quarter by 4Q26, and $45.5 billion in 2027 on just ~1GW of capacity, at an implied $35-57 billion per GW:

Source: Deutsche Bank

Here Is The Problem: Spot Is Four Times The Hurdle

Now compare that rate card to what the rest of the AI economy needs to earn.

Last month Goldman's tech analysts tried to size the AI economy needed to justify hyperscaler capex, and concluded that the six big US hyperscalers (Alphabet, Amazon, Microsoft, Meta, Oracle and SpaceX) need roughly $1.42 trillion of cumulative AI revenue in 2028-30, or about $11.6 billion per GW per year, to earn a 15% ROIC on their 2026-27 AI compute spend. Here is the sensitivity grid (from "Sizing the AI Economy Needed to Justify ROIC on Hyperscaler AI Capex", available to pro subs):

Even at a 30% ROIC and the most expensive capex assumption, the number never gets above $18.6 billion per GW. Short-term neocloud rents are 2-4x that. Our chart below puts every estimate we could find on one axis:

Two things jump out.

First, hyperscalers are paying neoclouds 4x what their own compute has to earn. Goldman models Google's SpaceX deal at $45 billion per GW (Deutsche says $50 billion). That same Google, per Goldman's ROIC framework, needs just ~$12 billion a GW from its own data centers. Nobody rationally pays a 4x premium for a commodity unless they can't get it any other way, so this is not a sign of healthy demand so much as a sign of power and shell scarcity: Google is renting because it can't build fast enough. Remember that the next time a hyperscaler raises its capex guide (undoubtedly much higher). The moment self-built capacity catches up, the premium on rented capacity goes away, and so does a big chunk of neocloud revenue, which incidentally is a point we made two weeks ago.

The more data centers are lit, the faster this bubble pops
— zerohedge (@zerohedge) September 25, 2026

Second, even the bulls' token economics can't pay spot rents. JPMorgan's Gokul Hariharan, in a framework for the next leg of AI infrastructure after what the bank's International Market Intelligence desk called a "biblical de-rating" (available to pro subs), was about as constructive as it gets:

Frontier-model vendors generate 60–80% inference gross margins and could earn $20–40bn of annual revenue per GW from AI tokens (vs $10bn in 2025).

Do the napkin math. If compute is 20-40% of a lab's token revenue (i.e., a 60-80% gross margin), then a lab paying $45 billion a year to rent a gigawatt would need to sell roughly $110-225 billion of tokens off it, or three to eleven times JPM's own optimistic range. In other words, nobody is renting spot capacity at $45 billion a gigawatt to serve paying customers at a profit. They're renting it to train the next model, funded by the next round of equity or debt.... well, mostly debt.

Source

Which is exactly the point Rothschild Redburn's Alexander Haissl made when he slapped Sell ratings on CoreWeave and Nebius last month: compute pricing is rising, but who pays matters, and the top-paying customers are mostly VC-funded startups and big tech companies using compute for training rather than inference. In his words, "training demand can persist as long as external capital remains available." Which, yes, is another point we made two weeks ago.

How many of those customers are funded by VCs who are also investors in Anthropic
— zerohedge (@zerohedge) September 23, 2026

Goldman's TMT desk is now flagging Oracle and Broadcom credit spreads as the key indicator of concern over debt-funded AI capex, with Oracle 5Y CDS closing at a record 261bp on Thursday.

Only Compute You Rent Out Earns Neocloud Rates

The cleanest illustration of the gap is inside Goldman's own SpaceX model. The ~1GW rented to third parties earns $40.5 billion per GW. Everything SpaceX keeps for itself ("Other AI revenues": Grok, X, enterprise, the Cursor acquisition) is modeled at $12-13 billion per GW, almost exactly the hyperscaler hurdle. And the Street is even lower: back out the hosting deals from Visible Alpha consensus and SpaceX's own compute is implicitly monetized at ~$8 billion per GW in 2027 and ~$13 billion in 2028:

Goldman's bull case is that this is "significantly lower than current industry rates" and that if SpaceX can monetize 75% of its non-hosting compute at the $20 billion long-term floor (leaving 25% for training at zero revenue), AI revenue would come in ~31% above Street for 2027 and ~9% above for 2028:

What if the 90-day leases do get cancelled? Then, Goldman says, SpaceX would need to earn ~$18 billion per GW on reallocated compute in 2028 to hit consensus, "a reasonable, if not conservative, level of monetization compared to current industry rates":

Maybe. But note what "current industry rates" means here: the price of renting compute to someone else at a moment of acute shortage. The bull case quietly assumes that compute used in-house (or rented to whoever replaces today's tenants) will earn what scarce compute earns today. The Street, which models $8-13 billion, is pricing the opposite: that once the shortage ends, a gigawatt earns roughly what a hyperscaler needs it to earn, and not a penny more.

Oh, and there will be a lot more gigawatts. Goldman sees SpaceX alone going from 1.4GW in 2Q26 to ~7GW by end-2027 and ~10.6GW by end-2028:

Neocloud Revenue Is Somebody Else's Cost

Which brings us to the real tension between neocloud revenue, hyperscaler revenue and AI "industry" revenue: they are largely the same dollar, counted several times.

Follow a single dollar of end-user spend.

An enterprise pays Anthropic, which books it gross (cloud partner cut included).
The cloud partner (AWS, Google) books its share as cloud revenue.
If that partner is short of capacity, it rents a gigawatt from SpaceX or CoreWeave, which books it as hosting revenue.
Then SpaceX and CoreWeave pay Nvidia, which books it as data center revenue.

Add up "AI revenue" across the stack and you get a number several times larger than what end users actually paid, and every layer above the end user is someone else's cost.

That's not a hypothetical. Just this week, AI equities puked after the FT reported that OpenAI's annualized revenue was ~$50 billion at end-September, $20 billion below the ~$70 billion MRR number circulating. As Goldman's TMT specialist Sean Johnstone explained (available to pro subs), the gap came from gross vs net reporting:

Anthropic reports closer to gross revenue (full customer spend through cloud partners, partner cut booked as a cost). OpenAI has reported closer to net (mainly its own share). When some investors tried to put the two on a like-for-like basis by grossing up OpenAI's figures, they produced the higher ~$40bn (August) and then ~$70bn numbers... The episode highlights how sensitive the complex has become to the precise trajectory of two private companies that use different reporting conventions.

And then Bloomberg added that even the $50 billion was gamed exercise in reaching the highest possible annualized number, i.e., "a projection of OpenAI's yearly sales based on a shorter period":

The same desk also reminded clients of Brad Gerstner's mid-September framework: the top three labs (Anthropic, OpenAI, SpaceX/xAI) were at a combined ~$100 billion run-rate in July and needed to reach $180-200 billion by year-end "to keep the AI trade intact." And as Johnstone notes, even that framework mixed Anthropic on gross, OpenAI on net and SpaceX on a "closer to gross" basis "for its compute hosting contracts." In other words, part of the "lab revenue" that is supposed to pay for compute is itself compute revenue. Diversification at its finest.

The buyer base is also absurdly narrow. As we tweeted two weeks ago:

The top 10% of AI customers account for 99.5% of model-serving spend and 99% of neocloud spend, leaving the bottom 90% of firms with 0.5% and 1%: Apollo https://t.co/npmKbOV75r
— zerohedge (@zerohedge) September 28, 2026

Put that next to Goldman's 90-day cancellation clauses and the picture is clear: neocloud revenue rests on a handful of customers, most of them cash-burning labs and capacity-starved hyperscalers, renting on paper they can walk away from in a quarter.

Spot Prices Don't Scale

Finally, the math that ties it together. Back out Goldman's $1.42 trillion revenue requirement at $11.6 billion per GW per year and you get roughly 41GW of AI compute that the six US hyperscalers are building with their 2026-27 capex (our approximation). Now price those 41GW at each point on the rate card:

At Goldman's 15% ROIC hurdle: ~$470 billion a year of AI revenue
At the long-term hosting floor of $20 billion: ~$810 billion
At today's short-term neocloud rate of ~$45 billion: ~$1.8 trillion

Compare that with the ~$100 billion the top three labs were running at in July, the $180-200 billion Gerstner says they need by year-end, and the ~$300 billion of annual AI revenue Goldman's Portfolio Strategy team says the market "now needs evidence of" to support the current scale of investment:

Put differently, today's neocloud rates are a marginal price for scarce capacity, not an average price the whole buildout can earn. Even the hurdle rate requires end-demand to grow roughly 2.5x from Gerstner's year-end target, and that is before anyone pays a neocloud a dime of scarcity premium (or takes into account that an entire country named China exists with an entirely separate, and much, much cheaper AI ecosystem). Which is also why Goldman's TMT desk, summing up the bank's capex research, concluded with admirable understatement that "future returns should increasingly come from selective winners... rather than owning anything linked to AI capex."

Bottom Line

Goldman's Sheridan remains a buyer of SpaceX with a $230 price target, and argues that the "supply constraints and lack of available capacity putting upward pressure on spot rates" give him confidence SpaceX can monetize compute "at high ROICs even if these deals are canceled."

He may be right about SpaceX, which has the power, the shells and the Nvidia relationship. But for the AI complex as a whole, the rate card says something less flattering. Short-term rents of $40-50 billion per GW are a scarcity premium paid mostly for training, mostly by capital-funded buyers, on 90-day paper. The long-term market already prices compute at half that, the hyperscalers need a quarter of it, and the Street is pricing in-house compute at the hurdle. With capacity set to multiply (SpaceX alone more than 4x from year-end levels by 2028), the scarcity premium is the thing least likely to survive, and as it compresses, the neocloud revenue that props up hosting deals, chip-backed SPVs and lab "run-rates" compresses with it.

In compute (as in shipping, and everything else), nothing cures record rates like record rates. The term curve is already telling you where AI compute is headed; the only question is whether end-user revenue gets there first... or (more likely) the credit market, where chip-collateralized obligations are priced as if spot were forever, figures it out on its own.

Much more in the full Goldman SpaceX Q3'26 preview and "Sizing the AI Economy Needed to Justify ROIC on Hyperscaler AI Capex" notes, as well as Deutsche Bank's "Got compute?", all available to pro subs.

Tyler Durden Sat, 10/10/2026 - 16:55
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Trump Threatens Billions In Federal Funds If NYC Doesn't Put 'Little Italy' Back On Map

2026-10-10T14:19:32.351-07:00

Trump Threatens Billions In Federal Funds If NYC Doesn't Put 'Little Italy' Back On Map

Authored by Nicholas Zifcak via The Epoch Times,

President Donald Trump on Friday threatened to withhold billions in federal funding from New York City unless the city updates a map of immigrant communities to include Little Italy.

In 2023, the city created a map, "New York City Immigrant Enclaves," that maps ethnic communities across the city, such as Chinatown in Lower Manhattan, Little India and Little Manila in Queens, and Little Palestine in Bay Ridge, Brooklyn. However, the map omits Little Italy as well as ethnic neighborhoods of Irish and Jewish communities.

Speaking at a Columbus Day celebration at the White House, Trump threatened to cut billions in city funding. "So you have Yemen covered, Haiti covered, Guyana covered, Senegal covered. I think it's a disgrace. We are going to work on that immediately," said the president.

The city budget relies on federal funding, with as much as $8 billion in the city's 2025 fiscal year budget coming from federal sources - most of that going toward education and social services. Federal grants also support counter-terrorism funding for NYPD bomb squads and emergency preparedness teams.

In October, 26,500 New Yorkers lost federal SNAP benefits for food assistance under expanded work requirements set up by the Trump administration. Starting in January 2027, possibly 900,000 New York City residents relying on Medicaid may lose health coverage when new federal work requirements take effect. This federal aid goes to individuals, not the city, but the city and state are scrambling to compensate lower-income New Yorkers for these lost benefits.

The 2023 immigrant enclave map resurfaced on social media back in July, and the City Council's Italian Caucus released a statement on X that it was deeply disappointed with the city for omitting the contribution of Italian-Americans.

"Italians are not a footnote in New York City history - we helped build it," City Council's Italian Caucus said in a statement on X on July 10. All four members of the Italian Caucus are Republicans.

When asked about leaving out Little Italy, Mayor Zohran Mamdani said the map predates his administration, but that it would be updated in the future to include Little Italy and others.

"It's clearly not an exhaustive list of the more than 200 ethnic enclaves," Mamdani said July 11.

Trump Commemorates Columbus

In his speech, Trump said Columbus "undertook one of the boldest voyages in the history of our planet" when he set sail in 1492 westward with the goal of reaching Asia but instead landed in the New World.

Trump said that critics of Columbus want to abolish Columbus Day.

"They want to tear down the history and heritage that makes us who we are," the president said.

Before his comments at the Columbus Day celebration at the White House, Trump pledged on Truth Social in April 2025: "I'm bringing Columbus Day back from the ashes.

"The Democrats did everything possible to destroy Christopher Columbus, his reputation, and all of the Italians that love him so much."

During President Joe Biden's term, the federal holiday was known as both Columbus Day and Indigenous Peoples' Day. Biden issued the first-ever presidential proclamation recognizing Indigenous Peoples' Day, which has its roots in 1970s activism.

Activists wanted to shift the focus from commemorating Columbus's 1492 voyage to the Americas to the negative impact of colonization on the indigenous people on the continent.

At the celebration, Trump also gave a shoutout to notable Italian Americans including Yankees icon Joe DiMaggio, legendary singer Frank Sinatra, former Supreme Court Justice Antonin Scalia, former New York City Mayors Fiorello La Guardia and Rudy Giuliani, and Supreme Court Justice Samuel Alito.

Tyler Durden Sat, 10/10/2026 - 16:20
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CNN Sees Metric That Looks 'Darn Good' For Republicans Before The Midterms

2026-10-09T17:19:28.615-07:00

CNN Sees Metric That Looks 'Darn Good' For Republicans Before The Midterms

CNN chief data analyst Harry Enten reported Wednesday that voter registration data in four swing states favors Republicans heading into the November midterms. This measure runs counter to polling showing Democrats ahead.

Enten told anchor John Berman that Republicans have improved their party registration margin relative to Democrats by 4 to 8 points in Arizona, Nevada, North Carolina, and Pennsylvania since the midpoint of President Donald Trump's first term. The comparison covers the eight years between the 2018 midterms and the current cycle and draws on state registration records, which count voters who have signed up with each party. Polls, by contrast, estimate how a sample of respondents say they plan to vote, and pollsters weight those results using their own assumptions about who will turn out.

"When you take a look at how people are actually registering — this is not polling data — compared to where we were eight years ago, Republicans are doing considerably better [than the Dems] in what are the swing states," Enten said on CNN.

Berman then asked whether the picture changes over a shorter window. He noted that the baseline for the comparison was 2018 and that polling over the past two years has moved toward Democrats.

Enten said the registration numbers do not show a matching shift in either Pennsylvania, North Carolina, Nevada, or Arizona. "There may be some tiny late gains that are going on right now, right, that I think over the last month maybe Democrats are gaining. But when you take the longer term view versus the 2024 election in which Republicans won all of these states, Democrats are, in fact, not actually gaining ground."

Berman said viewers have seen some upward movement for Democrats in the past couple of months. Enten agreed that the recent movement exists, but the problem for the Democratic Party is that it does not approach the size of the Republican gains.

"There's been some ticks up, but they, in no way, blows away the Republican gains," he said.

Asked to place the numbers in historical context, Enten said the four states share a common result. According to his analysis, the GOP holds its best party registration position relative to Democrats in a midterm year in at least 20 years in each of those swing states.

"The bottom line is this, Republicans, right now, are in a much stronger position than they have been, not just compared to eight years ago, but over the long term as well, the relative health of the Republican Party, at least in terms of party registration, is pretty gosh darn good relative to the Democrats," Enten said.

Florida makes a great case study for this trend. Up until the Trump era, Florida was considered a key swing state, but thanks to Republican registration gains in recent years, it is roughly as Republican as Texas. Trump won both states by double digits in 2024.

"I remember when Florida was a swing state," Enten said. "The bottom line is that Florida has had major gains for Republicans in party registration, and it's reflected in the races in which people are running."

Should note the GOP is in its best position on party registration (i.e. not polls) going into a midterm in 20+ years. In total, the Dems have not gained ground since 2024 in key swing states (AZ, NV, NC, or PA). The GOP has gained big ground since Trump's 1st midterm in all 4. https://t.co/KXK7zc5dFY
— (((Harry Enten))) (@ForecasterEnten) October 7, 2026

All four states in Enten's comparison went to Trump in 2024, and each has competitive races on the ballot this year. Enten did not say how much of the Republican registration advantage he expects to carry over into turnout. Still, if even a fraction of those new Republican voters show up on Election Day, pollsters may find themselves explaining another miss.

Tyler Durden Fri, 10/09/2026 - 17:20
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Obama & The 'Sinister Shadowland' Behind Our Politics?

2026-10-09T17:19:19.350-07:00

Obama & The 'Sinister Shadowland' Behind Our Politics?

Authored by James Howard Kunstler via kunstler.com,

The Ripening

"Everybody's restless and they got no place to go / Someone's always trying to tell them something they already know / So their anger and resentment flow."

- Warren Zevon, Mohammed's Radio

In the stark October light, events and personalities skulk in the shadows like scavengers in an orchard of poison fruit. The dread builds as the dooryards get populated with the motorized effigies of blood-beasts, werewolves, phantoms, and ghouls. Halloween and Election Day have become the conflated celebration of a national death trip. How has it come down to our country, in a crucial election, seriously entertaining the antics of jihadis and Jacobin riffraff?

Some somebodies are orchestrating this frightful show from the sinister shadowland behind our politics. My guess would be Barack Obama and John Brennan, with a whole lot of help from a supporting cast of entrenched Deep State racketeers enlisted in their service, with their status and livelihoods at stake. Mr. Obama acts as if he is untouchable, probably due to being the personification of Liberalism's "Best Camper" trophy it gave itself to validate the Civil Rights struggle session of the century gone by. We are good people, we really are, and President Obama is proof positive of our goodness!

The truth is, we know next to nothing about his real origins and his journey to power. His family on his mother's side was pure CIA-connected, and his actual father is rumored to be Frank Marshall Davis (1905-1987), a Black American poet, journalist, and labor activist who was a member of the Communist Party USA - not the Kenyan Barack Hussein Obama, Sr. He went from nonentity to myth with no intervening storyline that makes any sense, just a set of rapid promotions with missing events between them: Occidental College in LA to Columbia U to Harvard Law to Chicago politics to Illinois State Senate, straight to the US Senate, and then, bang, into the White House only four years into his first Senate term.

At every stage along the way he was somebody's chore boy. But whose? My guess would be US Central Intelligence. . . that he was groomed to be the untouchable front man looking out for the agency's interests in dicey times. His quick political rise coincided with the rise of John Brennan through the ranks of the CIA. Early on, Brennan was drawn to Arabic culture, sojourned in Egypt as a student, and later served as the CIA's station chief in Riyadh, Saudi Arabia. He speaks Arabic fluently and is rumored to have converted to Islam (from Catholicism), though it has never been proven. At a 2010 New York University forum, he praised "the goodness and beauty of Islam."

The CIA, I would suppose, is composed of two great clans: one is made of the employees actually carrying out real intel-gathering and analysis. The other is of employees (current and former) looking out for the CIA's own black op activities and the immense fortunes connected with it - with plenty of overlap between the two clans. I'd guess that John Brennan, who was CIA Director between 2013 and 2017 (under President Obama), still runs a large rogue contingent of the CIA clan that does the black ops, sits on a large fortune, and acts like a sovereign organism outside the control of the elected US government.

That would explain why no one has been held accountable for the ten-year-long coup against Donald Trump. Brennan, and the forces he represents, appear to be outside the control of the regular government, including the DOJ and FBI, and to some extent able to control people throughout government by subterfuge, intimidation, and blackmail. All that nearly came apart during Donald Trump's first term with the bungled RussiaGate caper followed by the bungled Impeachment No. 1 operation. But Brennan's dark CIA clan triumphed with the 2020 election "victory" of non compos mentis "Joe Biden," followed by the successful Jan 6, 2021, fake "insurrection" at the US Capitol.

They stumbled badly again with the patently ridiculous court cases against former President Trump in 2023 and 2024. And now here we are in the middle of Mr. Trump's second term, with a titanic struggle going on, largely out of public view, for the soul of the nation. John Brennan is still at large, but a month ago he was served with a subpoena to appear before a federal grand jury in the Southern District of Florida. It looks like he will finally have to do some 'splainin' about events he's been involved with. You can be sure that President Trump means to see that it happens - whatever was signified by the departure of Joe diGenova last month.

It's also my guess that former President Obama has become John Brennan's hostage. He was probably assigned to run "Joe Biden's" fake presidency using Susan Rice and other party functionaries to carry out orders. Brennan surely has a dossier on Barack Obama that fills in the blanks in his sketchy biography, including Mr. Obama's secret sexual activities on the Chicago scene back in the day. Meanwhile, the former president has his electioneering duties to attend to, to try to flip the House and Senate so as to have one last go at defenestrating the man in the White House who threatens to put Brennan, Obama & Company out of business.

So, there's a war on backstage. The war itself has been mythologized by those actually paying attention to it, sometimes as the contest between "Globalists" and "Sovereigntists" or "Black Hats" versus "White Hats" or the Legions of Satan versus the God-loving followers of Jesus. . . Jihad v. Western Civ. However you characterize it, everyone feels the tension as though the current phase of this Fourth Turning is an unbearable space between the life and death of the nation. Hence, all the ghouls in the dooryards, reminding us to stay. . . very. . . scared.

We publish a variety of perspectives. Nothing written here is to be construed as representing the views of ZeroHedge.

Tyler Durden Fri, 10/09/2026 - 16:20
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Wells Fargo Faces Federal Probe Over $60 Billion Commitment To Black Homeownership

2026-10-08T18:19:35.415-07:00

Wells Fargo Faces Federal Probe Over $60 Billion Commitment To Black Homeownership

Wells Fargo is facing a federal investigation over mortgage programs designed to increase homeownership among Black Americans, as the Trump administration expands its campaign against corporate policies that make distinctions based on race, according to the Wall Street Journal.

According to The Wall Street Journal, the Department of Housing and Urban Development is examining whether the bank's lending practices gave certain borrowers advantages because of their racial backgrounds, potentially running afoul of federal housing discrimination laws.

The controversy stems from a series of commitments Wells Fargo made beginning in 2017, including a plan to provide $60 billion in financing aimed at helping 250,000 additional Black Americans purchase homes over the following decade. The bank later introduced refinancing assistance targeting minority households, partly in response to criticism of its mortgage approval record.

The WSJ writes that by the end of 2023, Wells Fargo had delivered roughly 40% of the financing it originally promised. Its refinancing initiative had also reached approximately 5,100 borrowers, reducing their monthly payments by an average of $100. The bank has since largely stopped promoting these programs publicly.

HUD Secretary Scott Turner argued that the bank's approach raises serious questions about whether Americans were being treated differently because of their race, regardless of the programs' stated intentions.

“Even if Wells Fargo did not violate the law, its practice of dividing Americans based on race is immoral, unethical and un-American,” Turner said.

The investigation comes as Washington takes a more aggressive approach toward diversity-related corporate policies that became widespread following the racial justice protests of 2020. Other major companies, including IBM and Deloitte, have already reached multimillion-dollar settlements involving allegations tied to diversity considerations in employment decisions.

Federal housing officials are reportedly looking into comparable lending initiatives at other banks as well, suggesting Wells Fargo may be only the beginning of a much wider examination of race-conscious financial programs.

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Survey: Young Democratic Women Far More Likely To Blame Men For Their Problems

2026-10-07T16:19:10.570-07:00

Survey: Young Democratic Women Far More Likely To Blame Men For Their Problems

Authored by Bryan Hyde via American Greatness,

A recent survey shows that a majority of young, Democratic women believe that "the challenges that women face in American society" are due in great part to the behaviors or actions of men.

Breitbart reports that data from the Survey Center on American Life offers a glimpse into the perceptions of young Democrat women, and suggests that third-wave feminism still has a significant grip on the younger generation.

26% of young Republican men blame their problems on women.

66% of young Democratic women blame their problems on men.

🔗 https://t.co/MpYz11xIb1 https://t.co/ceex5DwjZa pic.twitter.com/0BhA40XzrG
— Frank Luntz (@FrankLuntz) September 28, 2026

The survey reveals that 66 percent of Democrat women from the ages of 18 to 29 believe that the challenges women face in American society are "due in great part to the behavior or actions of men."

By comparison, only 18 percent of Republican women in the same age range blame men for those problems.

Survey Center pollsters also found that 54 percent of Democrat women between the ages of 30 and 49 believe that the challenges women face in American society are "due to the behavior or actions of men" as well, while just 23 percent of Republican women in that age range agree.

Those disparities generally shrank as women grew older, with fewer Democrats blaming men and more Republicans blaming them.

The survey reported:

Do men see things the same way? When men were asked whether women were to blame for the troubles men faced, only 16 percent agreed. Republican young men are more likely than Democratic young men to blame women for the challenges that men face, but only 26 percent do.

Political scientists and analysts report that these statistics reflect an escalating partisan polarization among Gen Z and millennial demographics.

The gender-political alignment has grown more rigid, with 2026 data indicating that 66 percent of all young women identify as or lean Democratic, while young men have progressively shifted toward the Republican Party.

Researchers tracking these trends have expressed concern that the ideological divide could increasingly impact modern relationships and family formation.

Breitbart reports that the survey coincides with an August Economist/YouGov survey examining cultural norms, which found that American women in general are split on whether they would rather pursue a career or care for their family at home, if given the choice.

In that survey, most Democrat women, 52 percent, said they would choose a career outside the home over staying home to care for their family.

Tyler Durden Wed, 10/07/2026 - 17:00
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FBI Accuses Washington Man Of Coaching Canada's Tumbler Ridge School Shooter, Agreeing To Livestream The Attack

2026-10-07T14:19:34.034-07:00

FBI Accuses Washington Man Of Coaching Canada's Tumbler Ridge School Shooter, Agreeing To Livestream The Attack

Federal prosecutors have charged a Bellingham man with helping another person commit murder in a foreign country - alleging he coached an 18-year-old who killed eight people in Tumbler Ridge, British Columbia, in February and agreed to livestream the attack.

At the federal courthouse in Seattle, law enforcement officials on Oct. 6, 2026, announce the arrest of a Bellingham resident accused of aiding in a deadly school shooting in British Columbia. Officials include assistant commissioner Elija Rain of the BC RCMP, left, FBI special agent in charge Mike Herrington, and acting U.S. attorney Neil Floyd. (KUOW Photo/Amy Radil). KUOW's caption spells the RCMP officer's name Elijah.

James Cody Bryant, 30, was arrested Tuesday, officials said at the federal courthouse in Seattle. The charge carries a possible life sentence, KUOW reported. Bryant is accused, not convicted. A preliminary hearing is set for Oct. 20.

NEWS RELEASE from @FBISeattle: Bellingham resident charged with conspiring to commit murder in connection with school shooting in Tumbler Ridge, B.C.

Read more on how this #FBI is pursuing justice for victims of violence. justice.gov/usao-wdwa/pr/…
— FBI (@FBI) October 7, 2026

On February 10, Jesse Van Rootselaar, 18, killed his mother and 11-year-old stepbrother at home, then five students and a school staff member at Tumbler Ridge Secondary School, before dying by suicide. Canadian officials said police had been to the home several times over mental health concerns. RCMP assistant commissioner Elija Rain said Canadian authorities contacted the U.S. Department of Homeland Security soon after, based on information from a platform the attacker had used.

Bryant and Van Rootselaar communicated on Discord, officials said, and Discord contacted law enforcement after the shooting. FBI Seattle special agent in charge Mike Herrington said the two discussed the attack in detail. Bryant allegedly sent money through PayPal so Van Rootselaar could buy shoes to wear that day and a lighter to ignite an explosive device.

"In addition to providing money, technical advice, and particular items to be used in the shooting, Bryant agreed to record a livestream feed of the attack and broadcast it in a way that would maximize notoriety for the shooter," Herrington said. Other messages suggest Bryant advised Van Rootselaar when the car would not start on the way to the school, after the killings at home, he added. Acting U.S. Attorney Neil Floyd said the planned broadcast was on Twitch. Officials said the feed shut down after about 20 seconds.

Charging documents show an exchange in which Van Rootselaar said, "I really hope you wouldn't ever snitch." Bryant replied, "I don't want to honestly. I know I can like, save lives I guess but idk." The government's press release also said there were conversations in which Bryant "tried to talk Van Rootselaar out of doing the attack." Officials said Bryant never contacted law enforcement, and agreed to handle the livestream just minutes before the attack.

United States v. James Cody Bryant complaint document is now public. Contains more information re the Tumbler Ridge mass shooting than 🇨🇦 has released from the start.
— Eric Schild (@EricSchild2) October 7, 2026

Officials said the two met about three years ago on Omegle, a now-defunct video chat service that randomly matched strangers, and that there is no indication they ever met in person or had ties to any other group. Both were born male and identified as female, officials said. The criminal complaint uses female pronouns for Van Rootselaar and no gendered pronouns for Bryant.

Herrington said distance does not shield a defendant. "If you think you are safe from prosecution because you did not pull the trigger or were not physically present at the scene of the crime, think again," he said. The Canadian investigation remains active, but Floyd said the case is being brought in the United States for now. "All the activity involved in this was committed here in the state of Washington," Floyd said.

Separately, victims' families and British Columbia, which sued in September, have taken OpenAI to court over Van Rootselaar's use of ChatGPT. The province's suit says the company flagged the chats but did not report them to police. Mother Jones reports ChatGPT helped the attacker get around its safeguards by framing questions as fictional or hypothetical.

DOJ release: Bellingham resident charged with conspiring to commit murder in connection with school shooting.

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50 Iranian Tanker Logjam Unfolds As US Naval Blockade Starves Tehran Of Oil Revenue

2026-10-06T14:19:07.990-07:00

50 Iranian Tanker Logjam Unfolds As US Naval Blockade Starves Tehran Of Oil Revenue

Bloomberg cites a new report from United Against Nuclear Iran that claims the US naval blockade of the Strait of Hormuz has created a parking lot of more than 50 Iranian tankers that dare not cross the critical waterway.

The nonprofit think tank, which focuses on combating threats posed by Iran, said the number of laden tankers was broadly unchanged from two months earlier. The tankers were mostly carrying crude, along with some petroleum products and LNG.

UANI also noted that empty tankers were waiting at anchorages across the Indo-Pacific region rather than returning to Iranian ports, adding that at least 20 Iran-flagged ships were positioned off Sri Lanka and another was off Oman.

UANI's report comes days after Bloomberg said Iran's crude loadings fell to zero in September.

Over the weekend, Treasury Secretary Scott Bessent joined Mike Allen on "The Axios Show" and confirmed: "For the first time in history, they [Iran], since they started pumping oil, they will have no oil on the water this week. They will have no revenue."

Bessent on Iran: For the first time in history, since they started pumping oil, they will have no oil on the water this week. They will have no revenues. https://t.co/PIrHwUCG4q
— Clash Report (@clashreport) October 3, 2026

Separately, last week, Goldman analysts Yulia Zhestkova Grigsby, Alexandra Paulus, and Daan Struyven told clients that a "divergence between the fall of Iranian exports and the rise of exports of other Persian Gulf producers" was underway.

The Goldman energy experts estimated that "dark exports" have helped boost Persian Gulf oil exports to 23.3 million barrels a day late last month, back to prewar levels.

All indications so far point to the Trump administration's "Operation Economic Outcast" working as planned, with allied Gulf exports continuing to flow while Iran is starved of oil revenue amid the blockade. The question is whether this plan should've been implemented on day one of the conflict.

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SpaceX "Looks Unusually Cheap" On The Forward: Morgan Stanley

2026-10-05T14:19:24.475-07:00

SpaceX "Looks Unusually Cheap" On The Forward: Morgan Stanley

SpaceX shares rose more than 5% in mid-morning trading in New York, breaking above the trading range that had contained the stock since mid-August. Shares climbed past the $160 level to $167.

Morgan Stanley analyst Adam Jonas wrote that SpaceX shares at these levels offer an inexpensive way to gain exposure to the space and artificial intelligence economy when adjusted for projected earnings growth.

"We expect developments over the next few months will help investors better appreciate the role of SPCX in addressing the critical bottlenecks of power and chip making, potentially unlocking earnings growth and multiple expansion for the stock," Jonas wrote in a note to clients.

Jonas pointed out that, at $159 per share when the note was written, Elon Musk's company looks expensive. But when adjusted for year-over-year growth, "SpaceX trades at just ~0.3x 2028e EV/EBIT/Growth, ~40% below the ~0.5x mega cap median."

He said that ahead of the next Starship launch, traders can take advantage of the "unique opportunity" to gain exposure to shares that, while "expensive on any trailing metric, look unusually cheap on the forward."

Jonas believes that the combination of AI chatbot releases, Starship test launches toward commercialization and high-priced neocloud deals could push the stock closer to $300.

Shares are up more than 5% on Monday morning but remain well below the $225 high reached following a blockbuster IPO in mid-June. At $167, shares are well above the $135 IPO price.

"View Starship test flight 14 as a success, marking the transition from design/test to production-grade & scale. See accelerating pace of Starship deployment, with 2-3 addt'l launches by YE26, reusability of booster in NTM & Ship catch by early '28," Wells Fargo analyst Ken Gawrelski wrote in a note.

Starship deploying Starlink V3 satellites https://t.co/TG7b8iHYkY
— Elon Musk (@elonmusk) October 3, 2026

According to Bloomberg data, 36 analysts have a "Bull" rating on the stock, while seven have "Neutral" ratings and four have "Sell" ratings. The average 12-month price target among the analysts is around $217.

When can locked-up shareholders sell?

Here's the schedule:

Looking ahead, SpaceX is targeting the Starship Flight 15 test for no earlier than October 19, or about two weeks from now.

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US Treasury Grants Sanctions Waiver For Some Iranian Flights To Iraq

2026-10-04T15:19:13.808-07:00

US Treasury Grants Sanctions Waiver For Some Iranian Flights To Iraq

Via The Cradle

The office of Iraqi Prime Minister Ali al-Zaidi announced on Friday that Baghdad has secured a narrow exemption from US sanctions on Iran’s aviation sector, allowing Iranian airlines to resume up to 40 daily flights to Najaf International Airport.

The deal excludes Mahan Air, the statement said, welcoming US “cooperation in granting the necessary exemption.” It added that the move would ease travel for pilgrims, patients, and tourists affected by the sanctions.

Wiki Commons

“Air travel does not merely represent transportation between two airports, but rather a bridge of communication between peoples,” it added.

Najaf is the chief hub for Iranian flights into Iraq, serving Iraqi Shia pilgrims bound for Iran’s holy cities and Iranians visiting shrines in Iraq. Iraq’s announcement came a day after Tehran called for the restrictions to be lifted.

Iran’s Foreign Ministry condemned Washington’s “illegal and inhumane” enforcement of sanctions beyond US borders, saying they targeted Iranian trade and aviation as part of Washington's campaign to isolate Iran economically.

Prior to the ban, roughly 25 Iranian flights a day landed in Najaf and about 15 in Baghdad, according to Iran’s ambassador to Baghdad, Mohammad Kazem al-Sadegh.

“Around 12,000 to 13,000 people travel between Iran and Iraq and vice versa on Iranian airlines, which is not a small number,” he told ISNA.

A source told Reuters that keeping the ban in place risked uniting Shia followers of Iran’s supreme leader and of Iraq’s Ali al-Sistani against Baghdad, undermining US efforts to curb Iranian influence in Iraq. Najaf airport had held out until September 25, when it too halted Iranian flights in line with US sanctions.

US Treasury Secretary Scott Bessent warned that, starting September 23, any company that fueled or serviced Iranian aircraft, or sold tickets for them, would be cut off from the dollar system.

Iran vowed to keep its international flights running in defiance of the US blockade, with Civil Aviation Organization spokesperson Majid Akhavan telling ISNA on 22 September that no flights had been canceled.

The pledge came as cancellations spread amid US pressure. Middle East Eye reported that Turkish Airlines, Pegasus, and AJet would halt all flights to and from Iran starting September 21.

The US Treasury sanctioned 36 entities linked to Iran’s aviation sector on 8 September as part of its so-called “Operation Economic Outcast” and withdrew the clearances that allowed non-US airlines to fly US-built or US-controlled commercial jets into Iran.

Washington’s measures applied to any foreign company doing business with Iranian airlines and to firms handling aircraft at Iraqi airports. Fearing US penalties, those firms stopped serving Iranian planes.

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Judge Freezes Border Wall In Big Bend, A Sector Covering A Quarter Of The Border But Just 1-3% Of Apprehensions

2026-10-04T14:19:30.717-07:00

Judge Freezes Border Wall In Big Bend, A Sector Covering A Quarter Of The Border But Just 1-3% Of Apprehensions

A federal judge in El Paso on Friday halted border wall construction across Texas's Big Bend region, a stretch of the frontier that accounts for only a sliver of illegal crossings.

US District Judge Kathleen Cardone read her order from the bench, issuing a preliminary injunction against "ground-disturbing activities" that stays in place while the case plays out, the Texas Tribune reports. She found the plaintiffs' constitutional claims likely to succeed.

The suit was brought by the Center for Biological Diversity on behalf of the Friends of the Ruidosa Church and a local river guide and landowner. It targets the federal waivers that let construction proceed "without following the National Environmental Policy Act, the Archaeological and Historic Preservation Act and many other laws," per Inside Climate News.

The work in question includes vehicle barriers and access roads inside Big Bend's state and national parks, plus a 30-foot steel wall on private land outside them. According to the Tribune, there are five contracted wall projects in the region. In May, Customs and Border Protection awarded a $1.7 billion contract for border wall in Big Bend, KWTX reported.

The Big Bend sector covers about a quarter of the length of the US-Mexico border but accounts for only 1% to 3% of Customs and Border Protection's migrant apprehensions each year, according to the Tribune.

Inside Climate News reports DOJ lawyers "presented few counterarguments and did not present any witnesses." CBP said it remains "confident in our legal authorities to secure the border."

At the hearing, Adam Isacson, an analyst at the Washington Office on Latin America, presented data showing Big Bend in "distant last place" in unauthorized crossings among the nine sectors that make up the US border with Mexico, Inside Climate News reports.

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Siberian Plague-Lab Death Draws FSB Escort For Ambulances

2026-10-03T16:19:12.776-07:00

Siberian Plague-Lab Death Draws FSB Escort For Ambulances

A possible plague case in Siberia has triggered a major containment effort after the death of a 28-year-old employee of an anti-plague laboratory. A hospital wing is under quarantine, nearly 200 people are reportedly under observation, and Russia's chief sanitary official has flown in. Local outlets say FSB units have been escorting ambulances carrying the woman's contacts for examination.

The authorities are clearly taking the threat seriously - but getting a straight answer out of the feds is another matter. Irkutsk Governor Igor Kobzev is still calling it a "particularly dangerous infection," while assuring residents that every identified contact is symptom-free and testing negative.

The dead lab worker has been identified as Daria Shipilova, a laboratory assistant at the Irkutsk Anti-Plague Research Institute of Siberia and the Far East, according to Lyudi Baikala and REN TV. She was admitted to hospital in Shelekhov with severe pneumonia, placed on a ventilator, and died. Reports differ slightly on the timeline: The Moscow Times gives a September 29 admission and a Thursday death (48 hours), while Lyudi Baikala says she spent three days in hospital.

According to The Moscow Times, Shipilova told medical staff she had accidentally broken a tube containing live bacteria while collecting samples. Lyudi Baikala, citing journalist Pavel Stepanov and the Telegram channel Mash, placed the alleged accident on September 25 and linked it to plague bacteria. Those reports describe the illness as pneumonic plague, although neither that diagnosis nor the laboratory accident has been publicly confirmed by investigators. IRK.ru reported that doctors initially suspected severe COVID and sent her to the hospital's COVID center.

By the evening of October 1, security and administrative officials were meeting in Irkutsk. Lyudi Baikala, citing a source close to law enforcement, reported that FSB units began accompanying ambulances transporting Shipilova's contacts for examination that day. The Insider carried the same account, while residents reported seeing people in protective suits on the streets. The FSB has not confirmed the escorts.

“There is a possibility that the number of people the young woman [lab worker] came into contact with reached into the three digits,” Irkutsk journalist Pavel Stepanov said*, and that residents have already noticed people on the streets wearing protective suits, masks and gloves.…
— Annie Jacobsen (@AnnieJacobsen) October 2, 2026

Shelekhov district head Maxim Modin confirmed that the hospital's inpatient department was under quarantine; the outpatient clinic remained open. Kobzev said the sanitary-epidemiological commission had convened on October 2 over a suspected "particularly dangerous infection." Anna Popova, who heads Rospotrebnadzor, the federal agency that runs Russia's disease surveillance and owns the anti-plague institutes, traveled to attend. The governor told TASS it was premature to identify the disease and made no mention of a death. Irkutsk also postponed a city cleanup day scheduled for October 3.

The reported contact numbers suggest how widely authorities are casting the net. REN TV and Izvestia put the total at roughly 197, with 189 hospitalized for observation: 114 in one facility, 63 in another, and 12 at the anti-plague institute. Eight remained outside hospital, and some accounts said the list was still growing. No secondary infection has been confirmed. Kobzev's October 2 statement said the contacts had no symptoms and negative tests, although some media reports claimed several people under observation had developed symptoms.

First Official Use Of 'Plague'

The leader of Buryatia (the next region over from the lab), Alexey Tsydenov, wrote that the woman who died of plague in Irkutsk region had not visited his republic. Citing Rospotrebnadzor and his government, he also said Buryatia had no plague foci, including along the Mongolian border. But even that acknowledgment became less definite: Meduza reported that he later edited the post to say she "may have died of plague." He did not identify the pneumonic form.

Meanwhile, competing accounts sent Shipilova to Thailand or Buryatia before she fell ill. Tsydenov denied the Buryatia visit. Gennady Onishchenko, who ran Rospotrebnadzor until 2013, questioned whether plague was involved at all, pointing to dormant rodents and fleas and snow already falling in Buryatia. That argument addresses a possible wildlife exposure; it does not resolve the allegation that she broke a tube of bacteria at work.

Izvestia and the Telegram channel Ostorozhno Novosti both report that investigators have opened a criminal case under Article 236, which covers sanitary violations that cause death by negligence. Nobody has confirmed it on the record. That charge only makes sense if somebody broke a rule at work.

By Saturday, some of the public information was disappearing. Baikalsk's administration posted a notice urging residents to limit travel to Shelekhov and nearby settlements, citing "unofficial information" about a plague case. Roughly two hours later, the notice was gone. REN TV also deleted five Telegram posts about the Shelekhov hospitalization figures.

Kobzev's Saturday post concerned an inspection by Roszdravnadzor, the healthcare-quality regulator rather than the epidemiological service, and did not address the infection. Comments asking why there was still no official statement went unanswered. Meanwhile, Lyudi Baikala reported that pharmacies in Irkutsk and Shelekhov had sold out of antibiotics.

The institute where Shipilova worked was founded in 1934 to fight plague and still leads plague surveillance for the region, alongside cholera, anthrax and tularemia. It is one of five such institutes nationally and the only one covering Siberia and the Far East. Natural plague foci remain in parts of southern Siberia, including Tuva, Altai and Transbaikal. Russia's last widely reported human case involved a child in the Altai Republic in 2016 and was linked to marmots.

The negative tests are welcome news, and the reports so far do not establish a spreading outbreak. But a young laboratory worker is dead, a hospital wing is quarantined, and almost 200 contacts have reportedly been identified. "Particularly dangerous infection" is a description of the stakes. It still isn't an explanation of what happened.

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Quantum Isn't Coming For Your Bitcoin

2026-10-03T16:19:11.346-07:00

Quantum Isn't Coming For Your Bitcoin

Authored by Brandon Black via Bitcoin Magazine,

For as long as Bitcoin has existed, new forms of FUD (fear, uncertainty, and doubt) have been used to predict its demise. Despite this, Bitcoin has grown into a multi-trillion dollar asset and begun to take its place in the global monetary order. In recent months, the specter of a cryptographically relevant quantum computer (CRQC) enabling an attacker to recreate secret keys from public keys and sign Bitcoin transactions moving other people's coins has returned as an evolved form of FUD.

Is this a realistic threat to Bitcoin's continued growth? In a word, no.

There is no evidence that a CRQC will be built within a decade, and it remains unknown whether such a machine will ever be built. The quantum threat remains FUD.

State of the Art

To date, no quantum computing machine has computed anything out of reach of a precocious 6-year-old (confirmed empirically). Quantum computers are remarkable technology and showcase the truly science fiction worthy capabilities of the modern world. These devices harness foundational technologies such as optical tweezers, laser cooling, superconducting flux qubits, electromagnetic traps, dilution refrigerators, and many more. Within these devices individual qubits are coerced into specific subatomic states (different for each candidate technology), entangled into superpositions, manipulated to represent computations, and then their subatomic properties are read and interpreted. The astounding truth is that these devices exist, and can be manipulated to produce meaningful computations across a handful of inputs. The cold reality check is that (for an example candidate tech.) to do a computation that a small child can do requires enough power to air condition a Texas high school, many hours of setup, and further hours of post-processing.

Reading the Future

I know what you're thinking, "but there's so much money flowing into quantum computing". Does money flowing into a field correlate with the rate of real-world technological progress in that field? Not really. In fact, it can be argued that until the correct underlying technology has been developed and the product-market fit confirmed, money flowing into an area has a negative correlation with the likelihood of applicable technology being developed. This can be clearly seen by comparing NASA's Space Shuttle program to SpaceX's Falcon 9. SpaceX took (mostly) known science and reduced it to practice to satisfy a demonstrable market need for reliable and lower cost access to space, at a program cost of less than $5 billion to first crewed mission. The Space Shuttle cost roughly $50 billion to reach its first crewed mission. Not only did Falcon 9 cost an order of magnitude less to develop, but it has a perfect crew safety record to date. There are many reasons for these differences, but it goes to show that no amount of money makes a technology that is not ready practicable. Translating this to quantum computing: we can see that with tons of money being thrown at the problem, technology demonstrations at massive cost are possible.

But this tells us nothing about whether more money will bring us the holy grail of stable, low-error qubits (like the reliability of the Falcon 9).

No amount of continued development on the Space Shuttle program would ever have produced the low cost, high reliability of Falcon 9, and it's entirely probable that no amount of continued development, at any cost, will ever make any of the current quantum computing technologies reliable enough to break a single key pair.

Now, you might be thinking, "but what about all the recent advancements?" There are two important things to keep in mind about recently published advancements.

First, many of these advancements have been advancements in pure mathematics only.

For example, the recent Google paper which had such an important result that they chose to redact the theoretical quantum circuit rather than risk it being used to break important cryptographic systems. This may seem like massive progress toward the future of CRQCs, but in fact it changed nothing. Unless (or until) the quantum hardware has its Falcon 9 moment, there simply is no device which comes anywhere near the stability and scale needed to run the redacted circuit. It's pure theater to hide a circuit designed for a device which may never exist.

Second, on the hardware side itself, we see many new results and bits of progress published in a given year, but how many of these relate to the same quantum computing candidate technology? How many represent merely a starting over after a prior result ended in a dead end? The reality is that these advancements do not represent some linear track toward eventual success. They represent the breadth-first search of an infinite possibility space within which quantum researchers are hoping to find a path along which they can proceed for even a modest distance without reaching yet another dead end.

When we look at the reality of the future of quantum computing, it's hazy at best. There are promising technological developments. Especially, to my eye, in the area of neutral atom devices. But it's far too early to tell if there's a path open toward an eventual CRQC along any of the currently known branches or if more restarts are in our future. If, at some point, we see many iterations of the same candidate technology implementing progressively more capable devices, and computing meaningful results that a precocious child cannot also compute, we can revisit this discussion with different evidence.

In Theory

There are two possible explanations for the repeated failure of quantum research to develop a CRQC over many decades. It's possible that it's just a hard problem and we're continuing to apply science and engineering to solve it and one day the ingenuity of the human species will prevail as it has in the development of the Internet, the smart phone, social media, and Bitcoin (left to the reader to decide which of these are positive developments). On the flip side, it may be that developing a CRQC is either impossible or will remain forever outside our grasp. Consider what it would mean for a CRQC to exist: the machine would have to represent within its superposition a field of possibilities the same size as the complexity of the cryptographic problem to be solved. I.e. to break the 128-bit security of the elliptic curve discrete log on Bitcoin's secp256k1 curve, the quantum superposition would have to represent all possible values of a 128-bit number. In classical computing, representing all such values would require more computer storage (by many orders of magnitude) than humans have ever produced. If there is even the slightest granularity to the quantum superposition (i.e. the quantum superposition is not perfectly continuous across all possible values) then the quantum computer cannot ever become cryptographically relevant. If the energy required to hold a superposition scales with the complexity of the field being represented then a quantum computer cannot ever be cryptographically relevant. The contemporary understanding of quantum physics does not rule out either of these possibilities.

Conclusion: Bitcoin Cannot Rest

Despite all of the preceding, Bitcoin development toward new cryptographic algorithms must continue. While a quantum attack on Bitcoin's cryptography is not imminent by any means, it's entirely possible that another flaw could be found through other means. We know that certain elliptic curves have been found to have weaknesses, and secp256k1 could be next. Bitcoin has survived as long as it has because attacks on the system have strengthened it and that will continue to be true as the quantum FUD attack plays out. The development of P2MR or P2TRv2, of SHRINCS, SPHINCS, IBC, ML-DSA, and more post-quantum signature schemes will eventually lead to improvements to Bitcoin's resilience in the face of future attacks even if an actual CRQC is never developed.

This piece is featured in the latest Print edition of Bitcoin Magazine, The Quantum Issue. We're sharing it here as an early look at the ideas explored throughout the full issue.

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Mushroom Cloud Over Alabama: Trump Just Pulled A Condoleezza Rice

2026-10-03T16:19:09.875-07:00

Mushroom Cloud Over Alabama: Trump Just Pulled A Condoleezza Rice

President Trump just pulled a Condoleezza Rice.

George W. Bush's Secretary of State had (in)famously stated "we don't want the smoking gun to be a mushroom cloud" in September 2002 while trying to fearmonger the public into getting on board with the Iraq invasion.

On Friday night, Trump rallied supporters in Mobile, Alabama amid a tour through deep-red states to bolster Republican turnout ahead of the November midterms.

On stage, he once again defended the decision to launch a war on Iran and repeated his line that voters should pretend that he is on the ballot. On higher oil as well as painful gas prices at the pump, he reiterated that it's a "small price" to pay to prevent Iran from having a nuclear weapon. He also claimed the Iran war will "probably" end soon after the midterms. That's when Trump proclaimed:

"But remember about the oil: You're paying a price, but boy, is that a small price than what it would be if these lunatics were allowed to have a nuclear weapon and used it on Mobile, Alabama."

TRUMP SAYS HIGH OIL PRICES A SMALL PRICE TO PAY, IRAN WOULD HAVE NUKED ALABAMA *** pic.twitter.com/MH17sEhNZp
— The_Real_Fly (@The_Real_Fly) October 3, 2026

We should start by noting the obvious: There is nothing in Iran's missile arsenal capable of reaching the United States. Not a single report has even so much as ever claimed it,

According to the Arms Control Association, the Islamic Republic does not possess operational intercontinental ballistic missiles (ICBMs), and certainly has never tested one. Iran's most advanced missiles have a long enough reach to perhaps hit central Europe, or else the remote US-UK base Diego Garcia deep in the Indian Ocean - but hitting Mobile, Alabama is absurd and an impossibility.

However, it's unlikely that your average Alabama voter knows this (though notably in the above clip the crowd's response is lackluster and the applause is very weak). Even the US intelligence community knows that the idea that the Iranians could send a projectile to reach the continental US is false on its face:

There is no serious evidence to back up all the claims that have been made about Iran developing long-range rockets to deliver nuclear warheads. The U.S. intelligence community assess that Iran may be technically capable of developing an ICBM with sufficient foreign assistance, not that they are doing so. Iran has never tested any long-range rockets. Iran's longest-range missiles are medium-range ballistic missiles, not the intercontinental-range missiles as critics will have us believe.

As far as the evidence shows, Iran is assessed to have deployed several dozen Shahab-3 and Ghadr-1 medium-range ballistic missiles with ranges up to 2,000 kilometers, as well as dozens of short-range ballistic missiles with ranges of 150 to 500 kilometers. Iran is testing a solid-fueled medium-range ballistic missile, the Sejjil-2, but that has not been tested since 2011 and the United States cannot confirm Iran's claims that this missile is deployed.

Likely Trump is himself fully aware of all this, but when the point is fearmongering the US public into supporting the next Middle East quagmire and half-baked 'forever war'.... well then logic, reason, and truth go out the window.

Vice President JD Vance pulled something similar not too long ago. Back in March in the opening weeks of Operation Epic Fury he implied that Iran could potentially turn a nuclear bomb into a suicide vest - another absurd claim, just based on the logistics and technical requirements alone.

Vance suggests Iran could have used nuclear suicide vests: “You talk about people who walk into a crowded supermarket and have a vest on, and they blow up the vest and a couple of people get killed, and that's a terrible tragedy. What happens when what's on the vest is not… pic.twitter.com/6HiCHhi4S9
— The Bulwark (@BulwarkOnline) March 26, 2026

"You talk about people who walk into a crowded supermarket and have a vest on, and they blow up the vest and a couple of people get killed, and that’s a terrible tragedy," Vance told a live briefing at the time. "What happens when what's on the vest is not something that can kill a couple of people, but can kill many, many tens of thousands of people?”

As we pointed out at the time, the simple reality is that a nuclear bomb could not be miniaturized to the point where it could be worn as a vest.

Dear Trump admin, at least come up with something better than old Bush NeoCon talking points.

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Egypt Arrests, Disappears Entire Newsroom Over 'Fake News' Allegations

2026-10-03T16:19:08.762-07:00

Egypt Arrests, Disappears Entire Newsroom Over 'Fake News' Allegations

Via Middle East Eye

Egyptian authorities have detained the entire newsroom of one of the country’s only independent media outlets in a move that rights groups have denounced as a "first" and an "alarming escalation" on free speech.

On September 28 and 29, security forces raided the homes of the six journalists - Mohamed Ashraf Abu Emeira, Abdallah Qadry, Islam Barakat, Omar Helal, Mohamed Mahmoud and Mohamed Adel - who constitute the entire team working for Matsada2sh (Arabic for "Don’t believe"). The arrests bring the number of journalists detained in Egypt to 24.

via AFP

"It is a first in Egypt: an entire newsroom behind bars," press freedom watchdog Reporters Without Borders (RSF) said, criticising the authorities for failing to reveal the journalists' whereabouts.

"It's a violation of the Egyptian Constitution, even though this is common practice. Journalists detained in Egypt are often forcibly disappeared for several days before being officially charged and brought before a court," the group added.

According to multiple accounts by rights groups, the officers confiscated the phones and laptops belonging to the journalists as well as those of their family members during the raids. They also did not present any arrest warrants and refused to disclose where the journalists would be held.

The interior ministry later published a statement confirming the arrests and accusing the journalists of running an unlicensed platform that is "run from abroad" and of spreading "fake news".

It also accused its journalists of being affiliated with the Muslim Brotherhood, the country’s largest opposition group that has been outlawed under the government of President Abdel Fattah el-Sisi since 2014.

One of the platform’s editors was previously detained in 2023 over similar allegations but was released two days later.

Matsada2sh was founded in 2018 as a fact-checking outlet that corrects misleading or inaccurate information by various sources, including those by official government sources or opposition media.

"Independent journalism is critical in any free society and Egyptian authorities’ failure to allow free exercises of expression to thrive flies in the face of a purported commitment to dialogue, transparency, anti-corruption, and regional leadership," more than 80 rights groups and independent media outlets said in a statement.

"The crackdown on the Matsada2sh platform and these arrests are alarming escalations on independent media and freedom of expression that cannot be allowed to stand."

One of the founders of Matsada2sh, Abdelrahman Mansour, who is not based in Egypt, told the Associated Press on Thursday that the families do not know where the journalists are.

"Everyone on this team knew the risks when they went to work every day, but it’s unacceptable for the government to make false accusations and forcibly disappear journalists just because they’re afraid of a free press," AP quoted Mansour as saying. "Their families are worried, we’re worried, we just want them released unharmed."

Tyler Durden Sat, 10/03/2026 - 16:20
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Brazil Braces For Election Volatility As Bolsonaro Gains On Lula, Bullish Options Bets Explode

2026-10-02T15:19:21.080-07:00

Brazil Braces For Election Volatility As Bolsonaro Gains On Lula, Bullish Options Bets Explode

The big election focus this weekend will be on Sunday, with the latest polling data showing right-wing Senator Flávio Bolsonaro and socialist President Luiz Inácio Lula da Silva are statistically tied. Polymarket, meanwhile, shows Bolsonaro with a wide lead.

Bloomberg reports that neither Bolsonaro nor Lula is expected to secure an outright victory in Sunday's first round of voting. This suggests that a second round on October 25 is highly possible.

For weeks, we've outlined that high volatility is expected in the Brazilian currency and stocks after this weekend's first round of voting.

Traders are increasingly positioning for former President Jair Bolsonaro's eldest son to beat the socialist. As we've pointed out, this could set up the next big squeeze.

So far, the election trade in Brazil is gathering steam: currency volatility is surging, bullish stock options have erupted, and Polymarket odds give Bolsonaro roughly a 55.6% chance of winning.

The Brazilian real's one-week implied volatility has jumped above 31%, its highest level since late 2022. That exceeds the one-month measure, which captures both voting rounds but remains below 25%, highlighting the extreme concentration of risk ahead of Sunday.

Open interest in options on the iShares MSCI Brazil ETF (EWZ) has hit a record of 9 million contracts, driven mostly by calls. Demand for bullish options on the main equity benchmark Ibovespa index has also increased since late August.

Citigroup and JPMorgan analysts have told clients to use options that would benefit from a stronger real, while Brazilian hedge funds, including Ibiuna and Verde, have told clients they have positioned themselves with options for a potential stock rally.

"We expect the biggest surprise to come in the first round, with Flávio likely to finish ahead of Lula," Fabricio Taschetto, CIO at Ace Capital, wrote in a note. He added that the market reaction could exceed the move already priced into options.

BofA analyst David Beker told clients, "Brazil outperformed LatAm and global markets this week. Focus is on the first round of elections on Sunday."

Tyler Durden Fri, 10/02/2026 - 16:40
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Schumer & The Democrats' "Alinsky-Grade Cloud Of Gaslight"

2026-10-02T15:19:20.123-07:00

Schumer & The Democrats' "Alinsky-Grade Cloud Of Gaslight"

Authored by James Howard Kunstler via Clusterfuck Nation,

The Ancient Parable

"I will throw you in prison. I want Chinese style communism to happen inside of the democratic party right now. I want to do cultural revolution shit."

- Hasan Piker, DSA Spox

Translation: Chuck Schumer knows that the Democrats have already been thwarted from rigging the election, from flooding the polls with illegal immigrant voters, with dead voters, with voters who moved out of state but still got mail-in ballots sent to their old addresses, with voters registered as living in Walmart parking lots, and so on. Chuck Schumer knows that the Civil Rights Division of DOJ is sending hundreds of lawyers to observe the action in swing state polling places. ICE might even be on hand to see who turns up.

So, Chuck Schumer is pretending that the Republicans will try to do what the Democrats actually did in several previous elections (including the last midterm, 2022, viz., AZ, GA, NV), and would have liked to do in this midterm, but can't. The Democrats will holler like crazy about it before the election to plant this idea in credulous minds. They will jump up and down going woo-woo-woo on Election Day itself to water the idea. And after the election they will blitz every critical precinct with lawsuits to prevent the vote from being certified, using select "activist" judges to issue TROs and writs to delay election results and de-legitimize the vote.

And if none of that avails - which it won't - they'll call out their ground troops, Antifa, BLM, Free Palestine, LGBTQ2S+, the furious transsexuals, the hysterical cat ladies, and suchlike to make a giant ruckus so as to provoke the president to invoke emergency powers to quell the mayhem. And then they'll point at Mr. Trump shrieking, "See! Tyrant!"

Chuck Schumer is such a shithead. Everybody knows that he intends for the Democratic Party to inflict lawfare and commit warfare on the midterm election (in that order), and hence on the American people, behind an Alinsky-grade cloud of gaslight claiming the other side is doing it.

Of course, it's the president's constitutional duty (Article II, Section 3) to take care that the laws be faithfully executed. You have seen that Mr. Trump is taking a good deal of care vis-à-vis this midterm election to avoid any hint of interference. You can infer that's at least one reason we have seen no indictments of the Deep State sedition artists operating so brazenly since 2016.

By the way, doing what's possible to make sure that only citizens can vote is taking care to faithfully execute the law, in case there's any question about that. A September 25 SCOTUS decision in Department of Homeland Security v. League of Women Voters (No. 26A308), a 6-3 majority (usual suspects dissenting) paused by lower-court judge Sparkle Sooknanan that had blocked the Dept. of Homeland Security's Systematic Alien Verification for Entitlements system - further proof that the Lefty-left won't abide any restrictions on who can vote.

The SCOTUS stay allows state and local officials to match their voter rolls against federal Social Security records, to sort out who can legally vote. AI could do this with novel efficiency. The catch is, states' participation is voluntary. Only twenty-seven states have moved to participate in this record-sharing. Another catch is that SCOTUS waited, for unknown reasons, before issuing their ruling until well into the "90-day rule window" (in the National Voter Registration Act) that doesn't allow actual changes in the voter rolls during this period, only identification of problems. We'll see if any of that dissuades non-citizens from attempting to cast a vote.

You have to wonder why the Democratic Party is acting like they've already won the midterms. After ten years of narrative control through their allies in the network media and what's left of the major newspapers, the Democrats apparently believe that if you assert an outcome often enough, Oprah Winfrey style, it will come true.

It's just another gaslighting op. Look at the Democratic Party's marquee candidates, a ragtag and bobtail of avowed jihadis, communists, neo-Jacobins, and plain old creeps such as Abdul El-Sayed in Michigan, Melat Kiros in Colorado, Darializa Avila Chevalier and Claire Valdez in New York, Angie Nixon in Florida, James Talarico in Texas, and Troy Jackson up in Maine. The old Chuck Schumer / Hakeem Jeffries wing of the party pretends to support this rabble, who have declared they are merely running under the party's banner for convenience and aim to deep-six the likes of Schumer and Jeffries at the first opportunity.

Will the Democrats still try to cheat their way through the midterms despite the obstacles and disincentives piling up around them? Probably, yes, because that will trigger conflict between the states and the Feds, and post-election chaos is what the party needs to keep hope alive, as they like to say. They want the results to remain in limbo as long as possible, with maximum lawfare around it to further confuse and confound the outcome.

It's in their nature. They are the scorpion riding the frog across the river in the ancient parable.

Tyler Durden Fri, 10/02/2026 - 16:20
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France Erupts Into Chaos As "Rioting Migrant" Kids Torch Schools And Busses

2026-10-01T14:19:09.750-07:00

France Erupts Into Chaos As "Rioting Migrant" Kids Torch Schools And Busses

Social unrest erupted across hundreds of French high schools and dozens of universities Thursday, forcing Prime Minister Sébastien Lecornu to convene an emergency meeting to address the "urban violence."

Corporate media describes the rioters as "French students" or "high school students," while alternative media outlets such as Remix News and Visegrád24 claim the rioters are migrant kids.

🇫🇷 French police are detaining rioting migrants near Lycée Charles Péguy High Schoolpic.twitter.com/pFtJpp1kce
— Visegrád 24 (@visegrad24) October 1, 2026

"What began as protests demanding better conditions for students and teachers has devolved into violence at dozens of locations, concentrated at schools with large immigrant populations," Remix wrote in a report earlier.

Visegrád 24 wrote on X, "Young second and third-generation migrants have attacked firemen in Marseille, stealing their fire truck and setting it on fire."

BREAKING:

Massive riots across France.

Young second and third-generation migrants have attacked firemen in Marseille, stealing their fire truck and setting it on fire. pic.twitter.com/nCYMKuibT1
— Visegrád 24 (@visegrad24) October 1, 2026

"Migrant student youths have set fire to multiple buses and even fire trucks in the French city of Marseille as chaos spreads," Visegrád 24 wrote on X.

Remix continued:

Migrant student youths have set fire to multiple buses and even fire trucks in the French city of Marseille as chaos spreads.

The Marseille transport authority, RTM, said several of its buses "were targeted near high schools in the north and east of Marseille," that "drivers had to leave their vehicles in a hurry and one of them was assaulted."

The regional Marseille government said an "unacceptable line" had been crossed at Victor Hugo High School, where "the principal, the deputy principal, the general secretary and the team leader were assaulted and doused with gasoline," according to the Provence-Alpes-Côte d'Azur region, cited by BFMTV.

France is descending into chaos as student blockades grip the country. Over 650 arrests have been made.

🇫🇷🔴 BREAKING: Migrant student youths have set fire to multiple buses and even fire trucks in the French city of Marseille as chaos spreads.

The Marseille transport authority, RTM, said several of its buses "were targeted near high schools in the north and east of Marseille,"… pic.twitter.com/hv8tilIB3B
— Remix News & Views (@RMXnews) October 1, 2026

In one instance, rioters torched the Nelson Mandela High School located in the French city of Nantes.

🇫🇷🚨 BREAKING: Nelson Mandela High School is currently on fire in the French city of Nantes.

Schools across France are being set on fire as student protests and blockades rage on.

This story is developing.

Follow: @RMXnews pic.twitter.com/pOgOO4w0HQ
— Remix News & Views (@RMXnews) October 1, 2026

At least 600 people were arrested on just Wednesday alone, according to Agence France-Presse. Student union L'Union Étudiante said 640 high schools and 30 universities were blocked today with more demonstrations planned.

The unrest began in the Paris metro area last week over teacher shortages and investment. Students are demanding smaller classes, renovated buildings, and changes to the system allocating university places.

Yet burning down schools and buses is the solution to the teacher shortage?

There could certainly be other forces at work: the weaponization of youth to cause social unrest, a strategy far-left groups and foreign adversaries can employ in asymmetric warfare.

Bloomberg reported:

Officials in the premier's office told reporters afterward that the far-left France Unbowed party of Jean-Luc Mélenchon was behind the movement, citing an assessment by the intelligence services.

The social unrest coincides with a worsening political environment for the establishment and a fiscal squeeze. French President Emmanuel Macron's approval rating has collapsed to just 18%, while Marine Le Pen, France's right-wing National Rally party candidate, is surging in the polls in the second round of the 2027 presidential election because of her anti-open-border stance.

Meanwhile, households are getting financially squeezed as fuel prices spiral higher. Also, the government unveiled plans Thursday to sharply reduce next year's deficit through spending restraint and higher tax revenues.

Then there's the risk premium on French government bonds, which rocketed higher today.

"France has been slowly but steadily breaking," said Mike Riddell, lead manager of Fidelity International's Strategic Bond Fund. "But today feels like the first day that broader financial markets have noticed."

Tyler Durden Thu, 10/01/2026 - 14:55
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Who Keeps The Money When AI Rewrites Bank Code?

2026-09-30T15:19:39.356-07:00

Who Keeps The Money When AI Rewrites Bank Code?

Authored by Patrick Feeley via Substack,

The code most American banks run on was designed in 1959, the year Alaska and Hawaii became states. A committee of government and industry people wrote COBOL so that business programs could be read by people who were not mathematicians, and a good part of it was modeled on FLOW-MATIC, an earlier language from Grace Hopper, a Navy officer. I doubt anyone on that committee thought it would still be running banks in 2026. In 2017 Reuters estimated that about $3 trillion of daily commerce still ran through COBOL. In April 2020, when unemployment claims in New Jersey overwhelmed the state's forty-year-old system, Governor Phil Murphy went on television and asked for volunteers who knew COBOL. The state had to go on TV to find programmers for its own unemployment system.

I bring this up because of a clip I posted last night of Bill Ackman talking with Shane Parrish on The Knowledge Project. Ackman said Cognition, the company behind the coding agent Devin, can rewrite a bank's COBOL "in a matter of days as opposed to many months." Someone replied asking me what I meant when I said commoditized lenders would compete the savings away. It is a fair question and I could not answer it in a tweet.

I do believe Ackman that the savings are real. Inside a large bank the core ledger still runs in batch. The balance a customer sees on the app at noon is an estimate (bankers call it memo-posted). The actual accounting happens overnight, when a mainframe works through a queue of jobs in a set order, posting transactions, accruing interest, charging fees, and producing files that every other system reads the following morning. The programs share data through copybooks, which are record layouts where a field is known only by its position. Cognition described one client where a single taxpayer ID showed up under dozens of different names across thousands of programs. Most big banks were put together through acquisitions, and each acquired bank came with its own core system that management was usually too nervous to shut off, so the old systems just piled up.

.@BillAckman tells @shaneparrish that AI will sharply cut what big banks spend on tech. Rewriting legacy COBOL (decades-old bank code) with @cognition now takes days instead of months. Ackman is right that the cost savings are real. The open question is who keeps them. Banks with …
— Patrick F. Feeley (@PFFeeley) September 30, 2026

Replacing all of that has gone badly more often than well. Commonwealth Bank of Australia spent five years and more than A$1 billion replacing its core, and people in the industry consider that one a success. TSB in the UK moved customers onto a new platform in April 2018 and the platform did not work. Customers were locked out, some could see other people's accounts, and service was not back to normal until December. TSB ended up paying £32.7 million in redress and £48.65 million in fines. Cognition's own figure is that roughly two-thirds of COBOL modernization projects fail. With odds like that most banks built layers around the old core and left it alone. JPMorgan expects to spend about $19.8 billion on technology in 2026, and its CFO told investors in February that the priority had moved to "modernizing the underlying application code and data." I would guess a large share of that budget still goes to keeping the layers standing.

Cognition is fairly careful about what its agents can do today. Devin is good at documentation, refactoring, and batch jobs, which are the parts of a migration where you can give the agent yesterday's inputs and outputs and let it keep trying until the new code matches the old results. Cognition estimates batch is 30 to 50 percent of a typical migration. The real-time systems (card authorizations, for example) are still out of reach. Banks also have a security reason to hurry. Anthropic's Mythos model, which can find and exploit software vulnerabilities, had bank regulators in the U.S. and Europe holding urgent calls this spring, and Reuters quoted security experts who named legacy bank systems as especially exposed.

Ackman's harder point came a little later in the conversation. "The problem with money generally is it's a commodity," he said. For loans I agree with him. A company that wants a five-year term loan will collect six or seven term sheets and take the cheapest one, and a bank whose costs just went down will give up some spread to win it. Deposits have never really worked like a commodity, and I think that is where his argument is missing a piece.

The best explanation I have read is from three NYU economists, Itamar Drechsler, Alexi Savov and Philipp Schnabl. Their paper argues that banks have real market power over deposits. When the Fed raises rates, banks raise what they pay depositors slowly and only partway. Keeping that power costs money for branches, bankers and technology, but almost all of the cost is fixed. So deposits end up behaving like long-term fixed-rate funding, which is how a bank can hold thirty-year mortgages without being wiped out every time rates go up. It is also why the industry's net interest margin has barely moved over several decades of rate cycles. The FDIC has it at 3.32 percent today.

Bankers measure this with the deposit beta (the share of a rate increase that gets passed along to depositors). Checking accounts have low betas. Online banks have high ones because, as the St. Louis Fed put it, their customers are looking for yield. During the 2022 hiking cycle the New York Fed found that super-regional banks passed through more than small banks did, while the very largest banks passed through less than either. After Silicon Valley Bank lost $42 billion in deposits in one day, money moved toward size, and the biggest banks did not have to pay more to get it.

Meta's Muse goes right at this. It launched September 8, the same day Cognition announced it had raised more than $2 billion at a $48 billion valuation with run-rate revenue near $900 million. Muse is a personal agent that reads accounts at more than 12,000 U.S. banks and financial apps through Plaid. On Tuesday, September 22, Schwab fell 6 percent, LPL fell 7 percent, JPMorgan and Wells Fargo each fell more than 3 percent, and XLF, the largest financials ETF, was down 2 percent. On Sunday Torsten Slok at Apollo put out a note titled "Is an Agentic bank run coming?" He pointed out that the average checking account pays about 0.1 percent while Revolut, SoFi, Wealthfront and others pay between 3.3 and 5 percent, and he warned that banks "could lose a large share of the cheap deposits they rely on to make loans."

Muse cannot move money yet. The Plaid connection is read-only, and Meta deserves to have that said. I still would not want to be running a bank's treasury desk this month. Most people leave savings at a tenth of a percent because switching is a hassle. Opening a new account takes an afternoon, and nobody wants to be the person who breaks their own direct deposit. If an agent already sees every balance and can fill out the forms, most of that afternoon goes away.

A hypothetical helps here. Bank A has $10 billion of deposits that are really savings, money the customers do not need next month and have not looked at in a while. Rates are at 4 percent, and agents push Bank A's beta on those balances up by ten points. That costs Bank A about 40 basis points on $10 billion, or $40 million a year. Say Cognition saves Bank A $15 million a year on code maintenance, which is my guess and not a published number. Bank A is behind by $25 million, and that is before counting any spread it gives up to keep borrowers. My numbers could easily be off in either direction, but for a bank funded mostly by savings I do not see the code savings covering the deposit cost.

Corporate treasurers dealt with this a long time ago. A company keeps enough in its operating account for payroll and suppliers and sweeps the rest into money market funds or Treasury bills, and banks price corporate deposits knowing somebody is watching. An agent gives an ordinary family something like a corporate treasurer. Next month's bill money will stay in checking. The surplus that has been sitting there since the pandemic probably will not stay at 0.1 percent, and I expect it to reprice slowly at first and much more visibly in the next rate cycle.

Some banks are safer than others. Deposits that run a business's payroll and payables, carry a line of credit, or belong to an owner whose banker actually picks up the phone will not move for half a point, and banks holding those should keep most of what Cognition saves them. Banks that fund themselves with rate-shopping savings and win loans on price are in a worse spot, since they will likely pass the savings on to borrowers and pay more to depositors at the same time.

This part relates most to my own work. Ackman was talking about big institutions that own their code. Most American banks rent theirs. The Kansas City Fed found that Fiserv, Jack Henry and FIS together served more than 70 percent of banks in its 2022 survey, and 61 percent of banks had used the same core provider for over ten years. When code gets cheaper for a community bank it gets cheaper for the vendor first. Whether any of it reaches the bank depends on a contract that may run for years and on how hard those three companies compete at renewal. Agents do not have to wait for any contract, and they will reach a community bank's depositors the same week they reach JPMorgan's. On September 22 the market sold banks with deep local relationships about as hard as it sold the ones without them, and in some cases I think that was a mistake.

If I were looking at a bank stock this month I would not spend much time on efficiency ratios, since nearly everyone's will improve. I would look at what the bank's deposits did from 2022 to 2024, which is the closest thing to a live test of stickiness the industry has had. I would want to know how much of the deposit base is operating money and how much is savings nobody has checked in years, and I would want the renewal date on the core processing contract. At Sargasso Capital Management we spend most of our time on small and mid caps where there is a wide gap between what AI can do and what the company has actually put to use. With banks that gap only matters if the customers are still there when it closes. Bill Ackman is right that the code is about to get a lot cheaper. I am just not convinced most banks get to keep much of it.

A note on sources. Bill Ackman's comments are from his September 2026 appearance on The Knowledge Project with Shane Parrish. Cognition figures come from its September 8 funding announcement as reported by Reuters, TechCrunch and SiliconANGLE, and from its April 2026 post on COBOL modernization. Muse details come from Meta's launch materials and coverage by TokenPost, CNBC and Zacks. The Torsten Slok note was reported by CoinDesk on September 28. COBOL's origins and New Jersey's April 2020 call for COBOL programmers are widely documented. Banking data comes from the FDIC Quarterly Banking Profile for the second quarter of 2026, the Federal Reserve Banks of New York, St. Louis and Kansas City, the Federal Reserve's review of Silicon Valley Bank, JPMorganChase's February 2026 Company Update, the FCA's TSB enforcement notice, Reuters reporting from April 2017 and April 2026, and Drechsler, Savov and Schnabl, "Banking on Deposits" (Journal of Finance, 2021). Bank A is a hypothetical example.

This post is for informational and research purposes only and does not constitute investment advice or an offer to buy or sell any security.

Tyler Durden Wed, 09/30/2026 - 16:20
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