GOP Lawmakers Leery Of Trump's Billion-Dollar Ballroom-Security Package

Wary of the terrible election-year optics, some federal Republican legislators are less-than-enthusiastic about approving a request for a billion dollars in security funding relating to President Trump's White House ballroom project. Some of them shared those feelings with reporters after they received a Tuesday afternoon closed-door briefing by Secret Service Director Sean Curran. 

When he first rolled out the 90,000-square-foot ballroom project, Trump repeatedly emphasized that the project would cost $200 million and be funded entirely with private donations. Now the ballroom itself is projected to cost $400 million -- still privately-funded -- but with another $1 billion in federal funding being poured into security provisions.

An artist's rendering of Trump's ballroom, which is now projected to cost $400 million before $1 billion in security add-ons (via White House)

“I think the timing and the optics are really bad,” North Carolina Sen. Thom Tillis told reporters Monday. “This time last year, roughly, maybe a little bit before, we were all impressed with the fact that this $400 million building was going to be paid for out of the generosity of donors, and now we’re hearing 2½ times that is necessary for some other aspect of the project.” The ballroom funds are supposed to be part of the ICE and Border Patrol bill that's considered as a GOP must-have. 

In his briefing to legislators, Curran provided an itemization of the big-ticket items comprising that $1 billion request. “He walked through the various categories,” Senate Majority Leader John Thune said. “So it was a good back-and-forth, a good discussion, and obviously we had a lot of questions that were asked by our colleagues, just to get the details and precision as much as possible about how dollars will be used.”

According to the Washington Post, the categories include: 

• $200 million for "hardening" the party room, from both above and below; finishes include bulletproof glass, and systems to detect chemical weapons and drones
• $180 million for a new White House visitor-screening setup
• $175 million for training Secret Service agents and improving "protectee security"
• $150 million to ward off "emerging threats" to include bioweapons and airborne attacks
• $100 million to secure high-profile national events

Following the briefing, Kansas Sen. Roger Marshall, who routinely votes as Trump wishes, was non-committal. “I still got some more questions, and they’re going to send us more information...I'm undecided." Similarly, Louisiana Sen. John Kennedy, said he has "a lot" of questions of his own, adding that "One of the biggest concerns on our side is adding to the deficit." 

TRUMP: "We have a ballroom that's under budget. It's going up right here. I doubled the size of it because we obviously need that."

REPORTER: "The price has doubled..."

TRUMP: "I doubled the size of it, you dumb person. I doubled the size. You are not a smart person." pic.twitter.com/iC03NPPEye

— Breaking911 (@Breaking911) May 12, 2026

Others were more candid. "Not happening here," said Pennsylvania Rep. Brian Fitzpatrick, when asked if the House was likely to approve the funding. Asked if he'd personally vote for it, he gave reporters a blunt "no." Asked about how the price tag looks to Americans being hammered at the gas pump by the fruits of the Trump-Netanyahu war on Iran, Alaska Sen. Lisa Murkowski replied, "Not good." 

The ballroom project increasingly seems like a midyear election gift from a tone-deaf Trump administration to Democratic candidates across the nation. In a recent poll, Americans oppose it by a lopsided 56%-to-28% margin. More than the cost itself, it's the juxtaposition of what looks like a vanity project against increasing financial hardships being imposed on everyday Americans by the war on Iran and Trump's tariffs.  

On Tuesday, Trump handed more such campaign fodder to Democrats when -- asked if Americans' financial woes were a motivator for making a peace deal with Iran -- Trump said, "Not even a little bit. The only thing that matters when I’m talking about Iran — they can’t have a nuclear weapon. I don’t think about Americans’ financial situation." Though he was clearly trying to emphasize the (dubious) security narrative behind the war, his failure to express empathy for struggling families turned his remark into a political weapon. 

President Trump is asked how much he considers Americans' financial situation when negotiating with Iran:

"Not even a little bit. The only thing that matters is they can't have a nuclear weapon. I don't think about Americans’ financial situation. I don't think about anybody." pic.twitter.com/BFxqVtZgQr

— The American Conservative (@amconmag) May 12, 2026

Tyler Durden Wed, 05/13/2026 - 15:05

Gamma And Momentum: A Recipe For Cheers And Tears

Authored by Michael Lebowitz via RealInvestmentAdvice.com,

Intel (INTC) shares have risen 90% over the past month and more than 200% since the start of the year. Its competitors, Advanced Micro Devices (AMD) and Micron (MU), are posting similar gains. Many other semiconductor stocks, along with some computer hardware companies, are the market’s latest AI darlings. Momentum and gamma are driving the outperformance, and, in their wake, a supportive narrative is trying to justify it.  

The narrative holds that the insatiable infrastructure buildout for AI, including data centers, GPUs/CPUs, networking equipment, and power grids, requires massive capital expenditure from the largest hyperscalers (Microsoft, Google, Amazon, and Meta). The suppliers of these products, including semiconductor and hardware producers, are the most direct beneficiaries.

AI will significantly improve the bottom line for many companies. But investors should be asking whether the stock prices have gotten too far ahead of fundamentals. The answer, in our opinion, is likely yes. As we wrote in Parabolic Semiconductor Rally Is Pricing In 2028 Already:

Here’s the part that should bother bulls the most. SOXX is trading at multiples that already reflect strong 2026 earnings. The current rally has likely already fully priced in 2026 earnings. From here, you are paying for 2027 and 2028 growth in a sector where the cycle has not been repealed. Semiconductors are still cyclical. Always have been. The day the AI capex cycle hiccups, even briefly, is the day this chart breaks.

To fully appreciate the recent astonishing performance, it’s worth looking beyond fundamentals and narratives to better understand how herding, momentum, and option delta and gamma can systematically drive prices higher and eventually lower. 

Momentum Creates Momentum

Financial momentum is the tendency for assets that have been rising to continue rising and those that have been falling to continue falling. Often, during a strong momentum phase, the pace of buying or selling increases, resulting in parabolic price gains, as we are witnessing with Intel and its competitors.

When a stock trends higher, investors increasingly notice the bullish momentum and buy it, which pushes the price higher and attracts even more buyers. This type of herding behavior can create a self-reinforcing cycle- buying begets more buying.

When momentum is strong, the pressure on new investors to join the trade or on existing ones to add to their positions is enormous. As these investors focus on the incredible rewards they might receive, they often lose sight of the trade’s fundamental justification. The result is a crowded trade with sometimes breathtaking gains, but ultimately a sharp reversal that strips profits from most participants. 

Retail and institutional momentum traders often use call options as a leveraged way to participate in price gains without buying the stock outright. Call options provide investors with limited downside risk and the potential for upside gains that can be multiples of the underlying stock’s price. Call buying can become a momentum accelerant, as we explain next.

What Is Delta

To better appreciate how options, particularly calls, can boost stock prices, which in turn adds momentum and fuels the herding behavior of millions of investors, we need to understand some option basics.

We start with delta. Delta measures how much an option’s price changes for every $1 move in the underlying stock. For instance, a call option with a delta of 0.50 will gain roughly $0.50 in value for every $1.00 increase in the stock price. Importantly, delta changes as the stock price moves. As shown in the hypothetical graph below, delta rises as the option approaches its strike price and falls as it moves below it. The non-linear rate at which delta changes is called gamma.

Delta is affected not only by how far the stock price is from the option’s strike price but also by implied volatility and time to expiration. Other smaller factors include put/call skew, dividends, and interest rates.

Gamma

Gamma quantifies the curvature of delta (the green line in the graph above). It is the rate at which an option’s delta changes for every $1 move in the underlying stock. For example, if a call option has a delta of 0.50 and a gamma of 0.05, a $1 rise in the stock pushes the delta to 0.55, and another $1 gain pushes it to 0.60, and so on. Think of it this way: delta tells you how much the option price will move per change in the stock, while gamma tells you how fast that relationship will change.

Gamma is highest for options closest to expiration. Thus, the recent surge in the number of very short-term and same-day expiry options (0dte) is significantly impacting options brokers, as we will explain.

Delta Hedging Can Drive Momentum

When an investor buys a call option, someone must be selling it to them. Most often, market makers and brokers fill that role. Their financial interest in selling options is to make money regardless of what the option price does, not by taking the opposite position of the options buyer. They try to ensure profits by hedging. 

Brokers hedge exposure by buying or selling shares of the underlying stock in proportion to the option’s delta. This process is called delta hedging.

Assume a broker sells an investor a call option with a delta of 0.50. The dealer will buy 50 shares of the stock for each option sold. If the delta suddenly jumps to 0.60, the dealer will buy 10 more shares. If the stock falls and the delta declines, the dealer will sell shares.

In isolation, this is simple hedging management that often has little impact on the markets. But when the options market becomes large enough relative to the stock market, this constant hedging activity itself begins to move prices. As they say, the tail is wagging the dog.

The graph below shows a sharp increase in call option trading over the past few years, resulting in significantly higher hedge-trading volume among option brokers.

Gamma Squeezes

The growing volumes in the options market, along with the popularity of very short-term and even same-day options, are intensifying broker hedge trading. At times, this heightened activity results in what is called a gamma squeeze. This occurs when a surge in call option buying forces hedgers to purchase shares at an accelerating rate, pushing the stock price higher. That higher price, in turn, forces hedgers to buy even more shares, pushing the price higher still. This reflexive loop can have a short-term, tremendous impact on the underlying stock price.

The conditions for a gamma squeeze typically require a few ingredients:

• a stock with relatively thin float.

• large buildup of near-the-money call options with short expiries.

• enough momentum to start the feedback loop.

Avis (CAR) was the most recent example. CAR surged from roughly $150 in late March to nearly $850 in a matter of weeks before collapsing back to $150. Unlike semiconductor and hardware stocks, the gamma squeeze in CAR was more pronounced because its float was small and short interest was nearly 90%. That said, call option volumes spiked by roughly 10,000%, contributing to the surge in the stock price.

The Gamma Flip

If a gamma squeeze can set a stock price or market on fire, the gamma flip can pour water on it.

Dealers are never perfectly hedged. Thus, to quantify how their hedging activity might impact the market, it’s useful to know the degree to which they are over- or under-hedged. In market parlance, that is their net gamma position.

When dealers are net short gamma (they have sold more options than they have bought), they are forced to buy stocks when prices rise and sell when prices fall to stay hedged. Thus, when dealers collectively hold short-gamma positions, they have to chase the market; their hedging activities amplify price movements and volatility.

On the other hand, when dealers are net long gamma, the opposite occurs. They buy weakness and sell strength. Accordingly, these hedging activities serve as a natural market stabilizer, dampening volatility.

The gamma flip occurs at the price level where a dealer’s gamma exposure crosses from positive to negative territory, or vice versa. This level is calculated by options analytics firms and is increasingly closely watched by institutional traders. The gamma flip is something of an invisible gravitational boundary in the market.

The graph below, courtesy of Radar Options, shows that as of May 11, 2026, the S&P 500 Index is in a long-gamma position, supportive of an uptrend with reduced volatility. If it were to flip negative by falling below 7185, we should expect increased pressure for further downside and higher volatility.

Keep in mind the graph is for the S&P 500. Each individual stock has its own aggregate gamma exposure level, which can differ widely from the market.

Option Extremes Today

Dealer hedging is dynamic; thus, gamma exposure and flip levels are constantly in flux. The graph below, courtesy of ZeroHedge, shows that the volatility in dealers’ aggregate gamma positioning has been extreme recently. In just a six-week period, gamma exposure flipped from extremely short, which supported the rally from the late March lows, to one of the longest gamma positions on record.

The graphic below shows how extreme the rush into technology call options has been. The bottom-left graph shows that call skew on the Nasdaq (QQQ) is the highest it’s been in over the past year. Call skew measures the extent to which out-of-the-money calls trade at higher implied volatility than at-the-money calls. High skew reflects aggressive demand for upside calls, which drives up premiums on higher call strikes. High call skew is most common in individual momentum stocks and during gamma squeezes, when the options market prices in a higher probability of explosive upside than a normal distribution would suggest.

Bear in mind that the put skew is currently very low, signaling historically low demand for protection. 

Summary

Options were traditionally used for risk management purposes.  Yet their proliferation and widespread use by traders and gamblers have created a market structure that increasingly results in significant volatility and enormous price changes for entirely non-fundamental reasons. Thus, the risk management tool has become a market risk in and of itself.

As we have witnessed with CAR and are currently seeing with many technology stocks, a stock price can surge when a critical mass of investors generates a momentum signal, drawing in more investors and short-dated call buyers. Options brokers then feed the momentum as they are forced to buy as the stock price rises.

Similarly, as we also saw with CAR and will likely see with some semiconductor and hardware stocks, prices can drop sharply not because of fundamental developments, but simply because momentum gives way, gamma flips, and dealer hedging amplifies a modest decline into something more severe.

Sometimes stocks and markets completely ignore fundamentals and run higher on a self-reflexive loop. During these moments, prices get divorced from fundamentals, and individual stocks and/or markets can become fragile.

Tyler Durden Wed, 05/13/2026 - 14:45

Ex-Con Hacker Twins Fired - Proceed To Wipe Out 96 Government Databases In Minutes

Note to employers: When you discover your twin brother employees are ex-cons who did time for hacking into the US State Department, and go to fire them, make sure you fully disable their access. 

February 2025, twin brothers Muneeb and Sohaib Akhter turned a routine job termination into one of the most brazen insider sabotage incidents in recent U.S. government history. Just minutes after being fired from Opexus - a Washington, D.C.-area contractor that provides critical case-management software to more than 45 federal agencies - the brothers allegedly launched a rapid digital assault that deleted approximately 96 government databases containing sensitive FOIA records, investigative files, and taxpayer data.

Muneeb and Sohaib Akhter

What made the case especially shocking was the brothers' prior history: both had served prison time for hacking federal systems a decade earlier. 

A Decade-Old Criminal Record

The Akhter brothers, both 34 and from Alexandria, Virginia, had a criminal past that Opexus completely missed - which, given what they do, is not great. In 2015, while working as contractors, they pleaded guilty to conspiracy to commit wire fraud, conspiracy to access protected computers without authorization, and related charges. Their crimes involved hacking into U.S. State Department systems and a private company, stealing personal data on coworkers, acquaintances, and even a federal investigator.

Muneeb received a 39-month prison sentence; Sohaib received 24 months. Both served their time and were released.

And yet... 

By 2023-2024, the brothers had landed engineering roles at Opexus (formerly known as AINS), a firm specializing in FedRAMP-certified case-management platforms. Its flagship products - FOIAXpress and the eCASE suite - help agencies process Freedom of Information Act requests, audits, investigations, EEO complaints, and congressional correspondence. Opexus systems host sensitive government data on servers in Ashburn, Virginia.

The company conducted standard background checks covering roughly seven years - which missed the 2015 convictions. Opexus later admitted that "additional diligence should have been applied" and that the individuals responsible for hiring the twins are no longer with the company.

Unbeknownst to Opexus at the time of termination, the brothers had been abusing their access for weeks. Muneeb had collected approximately 5,400 usernames and passwords from the company's network and built custom scripts to test them against external sites (including Marriott and DocuSign). He successfully logged into accounts and, in some cases, used victims' airline miles.

On February 1, 2025 - more than two weeks before their firing - Muneeb asked Sohaib for the plaintext password of an individual who had filed a complaint through the EEOC Public Portal. Sohaib ran a database query and provided it; Muneeb then used the credentials to access the complainant's email without authorization. This incident later became central to Sohaib's password-trafficking charge.

The Firing and the 56-Minute Rampage

On February 18, 2025, the FDIC flagged Sohaib's prior conviction during a background check for a potential new role at the FDIC Office of Inspector General. Opexus fired both brothers during a remote Microsoft Teams/HR meeting that ended around 4:50-4:55 p.m.

The offboarding was flawed: Muneeb's account remained active. ARS Technica has the timeline:

At 4:56 pm, Muneeb accessed a US government database that his company maintained. He "issued commands to prevent other users from connecting or making changes to the database, and then issued a command to delete the database," the government said.

At 4:58 pm, he wiped out a Department of Homeland Security database using the command "DROP DATABASE dhsproddb."

At 4:59 pm, he asked an AI tool, "How do i clear system logs from SQL servers after deleting databases?" He later asked, "How do you clear all event and application logs from Microsoft windows server 2012?"

In the space of a single hour, Muneeb deleted around 96 databases with US government information. He downloaded 1,805 files belonging to the EEOC and stashed them on a USB drive, then grabbed federal tax information for at least 450 people.

The brothers discussed the attack in real time. Sohaib observed Muneeb "cleaning out their database backups." They even queried an AI tool on how to clear SQL server logs and Windows event logs. They later reinstalled the operating systems on their company laptops to destroy evidence.

And What Else Did They Do? 

Based on the court documents (Superseding Indictment + Muneeb Akhter’s detailed Statement of Facts from his April 2026 plea deal), the brothers were up to quite a lot of malarkey. 

Massive extra data haul (1.2 million lines): Muneeb didn’t just steal ~5,400 usernames/passwords from Opexus. He also possessed a separate file containing ~1.2 million lines of full names, email addresses, phone numbers, physical addresses, and password hashes. This was stored across his personal laptop, Android phone, external hard drive, and cloud accounts.

The credential abuse went on for 10 months after they were fired: The database deletions happened on Feb 18, 2025, but Muneeb kept actively using the stolen credentials from May 2025 all the way until his arrest on December 3, 2025. He wrote custom Python scripts (one literally named marriott_checker.py), ran credential-stuffing attacks on hotels, airlines, and banks, and successfully logged into hundreds of victims’ accounts.

Sophisticated account takeovers with his own domains: He didn’t just log in - he changed victims’ recovery email addresses on airline, hotel, and bank accounts to addresses he controlled, such as [VictimName]@wardensys.com or @wardensystems.com (domains he owned). This let him lock the real owners out and keep using the accounts.

Real-time blackmail brainstorming during the deletion rampage: At ~5:12 p.m. on Feb 18 - while Muneeb was still deleting databases - the brothers literally discussed blackmailing Opexus. Sohaib said something to the effect of: “you shoulda had a kill script, like, blackmailing them for some money…” Muneeb shot it down, replying that it would be obvious proof of guilt. They also argued about whether to contact customers.

“Clean stuff up from the other house”: During the same conversation, Sohaib said: “We also gotta clean stuff up from the other house, man.” This strongly implies they had evidence or stolen data at a second location.

Muneeb fled with a government-issued PIV card: When Muneeb drove to Texas on Feb 24, 2025, he took his personal laptop, phone, and a Personal Identity Verification (PIV) card issued by a U.S. government agency. (PIV cards are the high-security smart cards federal employees/contractors use for system access.)

Other smaller but wild nuggets

• A “co-conspirator” (identity not specified in the public docs) wiped both company laptops by reinstalling the OS on Feb 21–22.
• Muneeb used stolen American Airlines miles twice: 29,000 miles for a real flight he actually took (SLC → DC on Nov 29, 2025) and 14,500 miles for another ticket he booked but didn’t use.
• Muneeb had a separate aggravated identity theft count from August 2022 (pre-Opexus) involving someone’s passport and personal info.

Guns too!

A federal search warrant executed at Sohaib's Alexandria home on March 12, 2025, uncovered seven firearms (including M1 and M1A rifles, a Glenfield Model 60 .22 rifle, a Ruger .22 pistol, and a Colt .38 Special revolver) plus roughly 378 rounds of .30-caliber ammunition. Under Virginia law at the time, these guns and the ammunition were fully legal for a non-prohibited person to own - no assault-weapon ban, no magazine limits, no restrictions on the specific models. The only prohibition was Sohaib's status as a convicted felon, which made possession illegal under federal law (18 U.S.C. § 922(g)).

The brothers were arrested on December 3, 2025. Muneeb ultimately pleaded guilty to major charges, including computer fraud and destruction of records. Sohaib went to trial.

On May 7, 2026, a federal jury in Alexandria convicted Sohaib Akhter on three counts: conspiracy to commit computer fraud, password trafficking, and possession of a firearm by a prohibited person. He faces a maximum of 21 years in prison and is scheduled for sentencing on September 9, 2026. Muneeb faces additional charges and potential penalties up to 45 years.

So, whoops...

As an aside, remember when House Democrats let the Awan Brothers go hog wild in their network for 13 years, were fired for suspected unauthorized server access, procurement irregularities, and possible data exfiltration, and were one of them was able to plead guilty to one count of making a false statement on a loan application and sentenced to time served - only to then receive an $850,000 wrongful termination settlement by the five Pakistani-American tech workers involved in the saga? Crazy!

Tyler Durden Wed, 05/13/2026 - 14:30

Ugly, Tailing 30Y Auction Makes History With First 5%+ Yield Since The Great Quant Crash Of Aug 2007

Moments ago, the last refunding auction of the week, the sale of $25BN in 30Y paper, made history: it was the first 30Y auction to print with a high yield above 5%, and a coupon of 5%, since August 2007... which as veteran traders will recall was the month of the historic quant crash which marked the S&P highs at the time and eventually culminated in the global financial crisis. 

The auction priced at a high yield of 5.046%, up sharply from 4.876% in April, and tailed the 5.041% When Issued by 0.5bps, the second consecutive tail following 4 stop-throughs. 

But, as noted above, what is more notable was that this was the first 5% interest rate coupon 30Y auction, and the the first 30Y auction with a high yield above 5% since... August 2007 when surging rates sparked a quant crash. Come to think of it, unlike retail momentum chasers, quants have had a terrible month. How much longer can they last? But we digress... 

Going back to the auction, the uglyness was all around: the bid to cover was 2.303, down from 2.385, below the 2.43 six auction average and the lowest since Nob 2025.

Internals were not quite as bad, with Indirects taking down 66.6%, up from 64.1% in April and just below the 66.8% recent average. And with Directs awarded 21.74%, Dealers were left with 11.7%. 

Overall, this was an ugly, tailing auction, but the question on everyone's lips is whether today's quction will - like in August 2007 - be the VaR shock equivalent of a bond auction that pops this particular bubble. For the answer keep a close eye on quants who are suffering badly. 

Tyler Durden Wed, 05/13/2026 - 13:35

Imminent Supreme Court Rulings To Watch For

Authored by Sam Dorman via The Epoch Times (emphasis ours),

Birthright citizenship, girls sports, the definition of Election Day, and other hot-button topics are on the line in upcoming Supreme Court decisions.

Illustration by The Epoch Times, Madalina Kilroy/The Epoch Times

The court’s 2025–2026 term is expected to end in June with a series of rulings that could impact social issues and President Donald Trump’s agenda.

The last scheduled oral argument was held on April 29; the justices considered whether Trump wrongfully terminated deportation protections for thousands of Haitian and Syrian nationals. That decision and a ruling on Trump’s order restricting birthright citizenship could influence immigration policy for decades to come.

So far, the court has already issued opinions on Trump’s tariffs and redistricting. Its remaining decisions could change how elections are conducted, as well as alter the balance of power between Congress and the president.

Here are the main decisions expected before the end of June.

Birthright Citizenship

A key part of Trump’s immigration agenda has been his attempt to limit who receives American citizenship. The 14th Amendment states that “all persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside.”

Historically, the executive branch interpreted this amendment to grant citizenship to babies born to illegal immigrants. Trump changed this interpretation on his first day in office, passing an executive order stating that the amendment only applied to children who had at least one parent with citizenship or lawful permanent residency.

In Trump v. Barbara, the president asked the Supreme Court to intervene after a federal judge blocked his executive order. During oral argument on April 1, the Justice Department said that parents should be legal residents or have some kind of allegiance to the United States before their children receive citizenship. The justices, however, seemed skeptical and indicated they may view citizenship more broadly.

Migrants, including a pregnant Haitian woman seeking to give birth in the United States, are apprehended by a U.S. Border Patrol agent in Yuma, Ariz., on Dec. 7, 2021. The Supreme Court is expected to rule on the constitutionality of a Trump executive order aimed at restricting birthright citizenship before the end of June. John Moore/Getty Images Girls Sports

Another highly anticipated decision focuses on Idaho’s and West Virginia’s laws preventing males from participating in girls and women’s sports. Federal appeals courts blocked those laws, stating that they conflict with another portion of the 14th Amendment known as the equal protection clause. That clause generally prohibits laws that classify or discriminate on the basis of certain characteristics.

The appeals courts said the state laws conflict with that clause because they classify individuals on the basis of their sex and “transgender status.” The U.S. Court of Appeals for the Fourth Circuit also said West Virginia’s law violated Title IX of the Civil Rights Act. That law prohibits sex-based discrimination in federally funded education.

The justices heard oral argument in January for the cases, known as Little v. Hecox and West Virginia v. B.P.J. Overall, the justices seemed inclined to uphold the states’ laws.

People take part in a rally outside the U.S. Supreme Court as justices hear arguments in two cases in which states have banned males from participating in female-only sports in Washington on Jan. 13, 2025. Madalina Kilroy/The Epoch Times Monsanto’s Weedkiller

Monsanto’s herbicide, known as Roundup, has cost the company millions of dollars following lawsuits alleging one of its ingredients, glyphosate, increases cancer risk.

One of those lawsuits made it to the Supreme Court in April and could determine how much Monsanto has to pay in future lawsuits. The case, Monsanto v. Durnell, focused on a Missouri jury that held the company liable for not warning about glyphosate’s purported risks.

Monsanto told the Supreme Court that the jury’s verdict was based on a faulty interpretation of the law. The jury said Monsanto was liable under a Missouri law that requires warnings for consumer products. Monsanto argued that the jury interpreted the law in a way that conflicted with another law passed at the federal level.

The Supreme Court’s eventual decision is expected to touch on a legal doctrine known as preemption, which says that federal law takes precedence over state law when there is a conflict between the two. In this case, Monsanto said the Federal Insecticide, Fungicide, and Rodenticide Act should take precedence.

“The People vs. the Poison” protesters rallied to protest Bayer/Monsanto regarding cancer-linked risks from the Roundup weedkiller outside the U.S. Supreme Court in Washington on April 27, 2026. Tasos Katopodis/Getty Images

That law gives the U.S. Environmental Protection Agency authority to regulate chemicals such as glyphosate. Because the agency already approved glyphosate’s use and didn’t require additional warnings, Monsanto said Missouri couldn’t require more either. Durnell argued that the verdict didn’t conflict with federal law and that Missouri should be able to protect its citizens’ health.

Trump’s Ability to Fire Bureaucrats

One of the main legal complaints leveled during Trump’s second administration was that he fired high-level bureaucrats without good reason. Leaders of so-called “independent” agencies, such as the Federal Trade Commission (FTC), sued, alleging that Trump didn’t show the type of cause federal law required of presidents when firing officials.

In Trump v. Slaughter, Trump asked the Supreme Court to intervene after a lower court blocked his attempt to fire FTC Commissioner Rebecca Slaughter. The justices seemed inclined in December 2025 to not just allow her firing, but also expand the authority presidents have in removing bureaucrats like her.

Their eventual decision could overturn a 90-year-old precedent from Humphrey’s Executor v. United States. In that 1935 case, the Supreme Court held that former President Franklin D. Roosevelt wrongly fired a former FTC commissioner and that Congress could restrict his ability to do so.

The Trump administration argues that the Constitution gives the president greater authority and that Congress cannot use laws such as the FTC Act to restrict his ability to remove bureaucrats.

Then-Federal Trade Commissioner Rebecca Slaughter participates in a privacy roundtable at CES 2020 at the Las Vegas Convention Center in Las Vegas on Jan. 7, 2020. David Becker/Getty Images Fed Independence

Like the FTC Act, another law, known as the Federal Reserve Act, said presidents couldn’t remove high-level officials without cause. That was the law that Federal Reserve Governor Lisa Cook cited when she challenged Trump’s attempt to fire her last year.

Trump removed Cook while citing allegations that she committed mortgage fraud, something she has denied. During oral argument in January, the Supreme Court wrestled with multiple questions: whether Trump gave Cook enough due process before firing her, how the firing would impact the economy, and how Trump’s view of his authority would impact the Federal Reserve’s independence.

Overall, the justices seemed inclined to side with Cook. The case, Trump v. Cook, followed other decisions in which the Supreme Court suggested that the Federal Reserve was more independent than agencies such as the FTC and that its members therefore deserved additional protections.

Federal Reserve Board Governor Lisa Cook (R) arrives for a board meeting at the Federal Reserve building in Washington on March 19, 2026. Kevin Dietsch/Getty Images Definition of ‘Election Day’

The 2020 presidential election reinvigorated debate over mail-in ballots, a controversial method of voting that Trump and others argue is vulnerable to fraud. Multiple states, including Mississippi, have allowed mail-in ballots to be counted after Election Day as long as they are postmarked on or before that day.

Trump and the Republican National Committee argue that practice violates a federal law that defines Election Day as “the Tuesday next after the first Monday in November.”

When the case, Watson v. Republican National Committee, reached the Supreme Court, the Trump administration supported the committee’s position.

“‘Election day’ was the day all voting needed to be completed; and the act of voting was not complete until a ballot had been officially received,” the Justice Department told the court.

Mississippi argues the law simply requires that voters make their choice by Election Day, not that their ballots are counted.

Election officials count absentee ballots at a polling place located in the Town of Beloit fire station near Beloit, Wis., on Nov. 3, 2020. Scott Olson/Getty Images

During oral argument in March, the justices seemed more likely to side with the committee. “We’re moving in this direction,” Justice Samuel Alito said. “We don’t have Election Day anymore. We have election month or we have election months.”

Deportation Protections

The court’s most recent oral argument focused on the Department of Homeland Security’s termination of deportation protections for thousands of Haitians and Syrians. “Temporary protected status” prevents nationals of certain countries from being removed if conditions in their home countries would make returning unsafe.

Under President Barack Obama, the department granted that status for Haiti, which was impacted by the 2010 earthquake, and Syria, which has seen ongoing political turmoil and armed conflict.

Former Homeland Security Secretary Kristi Noem terminated those protections last year, prompting lawsuits and federal judges’ orders blocking those terminations.

The justices heard oral argument in the cases, known as Mullin v. Doe and Trump v. Miot, on April 29. They considered whether those judges exceeded their authority under the Immigration and Nationality Act, which generally prohibits judicial review of the department’s determinations about temporary protected status.

Guerline Jozef, co-founder and Executive Director of Haitian Bridge Alliance, speaks in front of the U.S. Supreme Court in Washington on March 16, 2026. The Court agreed on March 16 to consider the Trump administration’s bid to strip Haitians and Syrians of temporary deportation protections. The Department of Homeland Security has announced plans to end so-called Temporary Protected Status for some 350,000 Haitians and 6,000 Syrians. Roberto Schmidt/AFP via Getty Images

Lower court judges, however, said the administration still had to follow certain procedures, but that it didn’t when it terminated those protections. The justices also considered a federal judge’s argument that the administration likely acted with racial animus toward Haitians and therefore violated the Constitution.

Campaign Finance

How much protection does the First Amendment afford political parties when they spend money on campaigns? That’s one of the questions the Supreme Court is expected to address in a case called National Republican Senatorial Committee v. Federal Election Committee.

The case originated with a lawsuit brought by then-Senate candidate JD Vance, who argued that Congress violated the First Amendment with the Federal Election Campaign Act. That law restricts how much political parties and candidates’ campaigns can coordinate their spending.

The Supreme Court upheld that restriction in 2001 on the basis that coordination opened a backdoor for corruption. In its upcoming decision, the court could maintain its prior position or overrule itself while siding with Republicans.

Read the rest here...

Tyler Durden Wed, 05/13/2026 - 13:35

Up To $170 Billion Needed To Secure Full Domestic Nuclear Fuel Supply Chain

To support current commercial nuclear operations, plus 300 GW of new nuclear capacity for a total of roughly 400 GW by 2050, all fueled domestically, the country would need to invest between $105 billion and $170 billion across the entire nuclear fuel cycle.

Is it still called a bottleneck if the entire industry is the problem? 

The consulting firm McKinsey & Company used the most aspirational scenario from the Trump administration’s May 2025 executive orders as its benchmark for their recent report. That means rebuilding capacity from mining and milling through conversion, enrichment, fabrication, and even reprocessing.

It's looking more and more like the $2.7 billion award from the DOE for domestic enrichment barely scratches the surface:

• $15-20 billion for mining and milling
• $30-45 billion for conversion
• $30-40 billion for enrichment
• $10-20 billion for fabrication
• $20-45 billion for reprocessing

These figures assume a mix of new and existing reactors, including Gen IV designs that will demand high-assay low-enriched uranium (HALEU).

We have documented the vulnerabilities for months. Today the United States imports about 99 percent of the raw uranium ore needed for its commercial fleet… 

With milling capacity effectively nonexistent and conversion limited to a single operating facility… 

And enrichment capacity covers only about one-third of domestic needs…

The gaps leave utilities exposed to geopolitical risks and price volatility, a point we highlighted when uranium spot prices pulled back earlier this year even as long-term supply deficits widened…

Uranium: the next gold pic.twitter.com/2SSjvRkdSg

— zerohedge (@zerohedge) December 12, 2025

Progress is

Uranium: the next gold pic.twitter.com/2SSjvRkdSg

— zerohedge (@zerohedge) December 12, 2025 ">accelerating, however. We reported on the DOE’s Nuclear Fuel Cycle Defense Production Act Consortium, which has met repeatedly to map out a seven-year “Nuclear Dominance – 3 by 33” plan covering every link from mining to reprocessing. 

DOE has also awarded nearly $3 billion for enrichment projects, including $900 million each to Centrus Energy and General Matter, while the Export-Import Bank has backed up to $4.2 billion in additional financing. Centrus recently committed $560 million to scale centrifuge manufacturing in Oak Ridge, and we covered its joint-venture discussions with Oklo for HALEU deconversion services.

The private sector is also making progress on their own, not wanting to wait for the government to sort itself out and attempt to take market share while it's up for grabs. 

Uranium Energy Corp is expanding ISR mining and advancing conversion licensing. New entrants like FluxPoint Energy and LIS Technologies are targeting conversion and next-generation laser enrichment facilities, aiming for commercial operations before 2030. 

We also noted Goldman Sachs’ updates showing persistent supply-demand mismatches that continue to support higher uranium prices over the coming decades.

McKinsey stresses that capital alone will not suffice. Permitting reform, infrastructure build-out, workforce development, and advanced technologies will prove critical to compressing the long lead times inherent in fuel-cycle projects. The firm acknowledges 100% domestic sourcing will prove challenging, yet the analysis underscores that options exist if stakeholders maintain focus.
 

Tyler Durden Wed, 05/13/2026 - 13:00

B200s Or B-2s?

By Bas van Geffen, senior macro strategist of Rabobank

Concerns about the Middle East continued to dictate markets yesterday. The Strait of Hormuz remains closed, and there were no signs that this will change soon. Oil prices rose further. Dated Brent jumped 5% on the day to top $111.

Alongside the rise in benchmark energy prices, yields increased too. 10y US Treasury yields closed around 5bp higher, and 10y German Bund yields rose 6bp to 3.1%, dragging broader EUR yields up. Equities struggled. European bourses closed around 1.5% lower, but the S&P pared most of its losses after the European close, so the Euro Stoxx index may catch up to its US counterpart today.

This reversal happened after oil prices came off their intraday highs, and as news broke that Nvidia CEO Huang will join the US delegation to China. President Trump indicated that he wants to focus on economic issues during his summit with President Xi, more so than on geopolitical issues in the Middle East. Markets certainly seem hopeful that Trump and Xi will discuss B200 chips rather than B-2 bombers.

Of course, the Iran war complicates negotiations between the two leaders. China agrees to oppose any toll scheme for safe passage through the Strait of Hormuz, according to the US State Department. Meanwhile, Iraq and Pakistan have reportedly made deals with Iran to safeguard oil and LNG shipments from the Gulf – underscoring that Iran is able to effectively control the flow of energy through the Strait of Hormuz. China has also further diversified its oil imports. This may make China more resilient to prolonged disruptions in Hormuz, while it also cuts off more potential income for Iran.

But China will probably want something in return. President Trump will reportedly discuss US weapons sales to Taiwan with Xi, breaking with a decades-long US tradition. US allies in Asia are alarmed that Trump may agree to Xi’s request to delay or stop deliveries. That’s a longer-term geopolitical risk, but markets may shrug off any such potential concessions if the US and China report progress on economic issues.

And any optimism from the Trump-Xi summit may be overshadowed by developments in the Middle East. It’s unlikely that tensions will flare up again during the summit, but that’s only two days of respite. On his way to China, President Trump told reporters that stopping Iran’s nuclear programme outweighs Americans’ economic pain. The US presidents’ comments add to concerns that tensions in the Middle East may flare up again after the summit.

Adding further unease about the US’ next steps in the Middle East, the Wall Street Journal reports that the US president spoke with his U.A.E. counterpart to discuss “mutual interests.” This news follows on the WSJ’ report that the United Arab Emirates had secretly carried out military strikes in Iran.

Elsewhere, gilt yields’ rollercoaster ride continues, as domestic politics stack on top of geopolitical risks. Even the BBC is talking about intraday moves in gilts now, which is never a sign that things are going well. Pressure on a defiant PM Starmer is building. Several ministers resigned from their posts yesterday, after dozens of MPs had already called on Starmer to resign. Today, the 11 unions that support the Labour party are expected to issue a joint statement that calls for a roadmap to a new party leader into the next general elections.

Uncertainty about the UK’s leadership continues to weigh on both UK sovereign yields and the currency.

Tyler Durden Wed, 05/13/2026 - 12:45

Qatar Asks Vessels At Key LNG Port To Go Dark for Safety

Submitted by Charles Kennedy of OilPrice.com

Qatar has requested LNG vessels near its Ras Laffan LNG port to switch off their transponders as part of safety measures at the key export port of the world’s second-largest LNG exporter before the war, anonymous sources with knowledge of the plan told Bloomberg on Tuesday.  

The de facto closure of the Strait of Hormuz has trapped about 20% of daily global LNG flows, mostly those previously shipping out of Qatar and part of the UAE’s LNG flows. 

In addition, Iranian drone and missile strikes on energy infrastructure in the region has damaged Qatar’s key LNG liquefaction complex Ras Laffan, the world’s single largest such facility. Due to the attacks, QatarEnergy has been forced to declare force majeure for up to five years on some long-term LNG contracts and has advised that full capacity could take up to five years to restore following extensive damage from the strikes. 

The waters around Qatar have seen increased security threats since the war began on February 28. After more than two months of total blockage of Qatari shipments out of the Strait of Hormuz, the major Gulf LNG exporter is now apparently seeking to avoid being targeted. 

At least nine LNG tankers that were anchored near Qatar stopped sending signals via their Automatic Identification System from May 11, vessel-tracking data compiled by Bloomberg showed, in a sign that Qatar may have indeed asked ships to go dark to avoid being targeted. 

A tanker laden with LNG from Qatar successfully passed the Strait of Hormuz this weekend, the first such transit since February 28.

Crude tankers have also successfully exited the Strait in recent days, after going dark, according to shipping data cited by Reuters. 

“Commercial shipping and maritime security activity around the Strait of Hormuz are increasingly shifting into dark or emissions-controlled conditions,” maritime intelligence firm Windward said on Monday.  

Tyler Durden Wed, 05/13/2026 - 12:30

Goldman Flags Troubling Mortgage Delinquency Rise Across This U.S. Region

Mortgage delinquencies fell slightly in March, with the first-lien delinquency rate declining to 3.35%, down 37 basis points from February, as seasonal factors and tax refunds supported borrowers.

The real estate and mortgage industry outlet HousingWire cited Intercontinental Exchange’s May 2026 Mortgage Monitor report, which showed that while the overall mortgage delinquency rate fell in March, there was still concern over serious delinquencies and foreclosures, which are up by 154,000 borrowers from one year ago.

The increase was driven mostly by FHA loans, which rose by 164,000 and now account for a record 55% of seriously past-due mortgages. Overall, 1.6% of active mortgages are seriously delinquent, up 20% year over year.

A lot of questions here...

During the Biden administration, H-1B visa holders were buying houses with 97-100% financing. 97% would come from the FHA, with the rest coming from state first-time home buyer programs.

Zero money down. Thanks to programs that were supposed to be helping low-income American… https://t.co/0ZaLGV0Wru pic.twitter.com/WvlRjgYeJV

— Robert Sterling (@RobertMSterling) May 13, 2026

Adding to the mortgage delinquency story is Goldman analyst Jason Acosta, who released a note earlier today, showing what he described to clients as the "chart of the day."

The chart indicates that mortgage past-due rates are highest across parts of the Deep South, with Mississippi and Louisiana as the worst-performing states, followed by elevated stress in Alabama, Texas, Indiana, Georgia, West Virginia, Oklahoma, Maryland, Pennsylvania, and others.

"On a national level, mortgage delinquencies eased in March, yet higher-severity stress remained elevated even amid the strongest monthly gain in U.S. home prices in two years," Acosta said.

He added, "We just released a new widget looking at past-due rates on a state-by-state basis below, with updates incoming to select between ranges of 30-59 days, 60-89 days, and 90 days+."

Here is the chart: What is the mortgage past-due rate by state?

Latest on the housing market:

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

The read we have here is that mortgage distress is becoming increasingly concentrated in lower-income Southern states, even as the national delinquency rate improved modestly overall.

Tyler Durden Wed, 05/13/2026 - 12:15

Treasury Department Alerts US Banks To Suspected Iranian Money Laundering Efforts

Authored by Victoria Friedman via The Epoch Times (emphasis ours),

The U.S. Treasury Department’s Financial Crimes ​Enforcement Network (FinCEN) on May 11 issued an alert to financial institutions warning them of efforts by ​the Iranian Islamic Revolutionary Guard Corps (IRGC) to evade sanctions.

The U.S. Department of the Treasury in Washington on June 30, 2025.Madalina Kilroy/The Epoch Times

FinCEN said in a statement that the IRGC has been facilitating and laundering the proceeds of illicit oil sales using networks of financial facilitators and shell companies. The alert provides red flags on the IRGC’s oil smuggling, digital assets, and front-company abuse to aid financial institutions in detecting and reporting suspicious activity, the statement said.

Treasury Secretary Scott Bessent said that financial institutions have a responsibility to stop this activity.

“Degraded by Economic Fury, the Iranian military is desperately trying to fund its weapons programs and terrorist proxies,” Bessent said.

“Treasury will continue to deny the Islamic Revolutionary Guard Corps access to the financial networks it exploits to fund its terrorist acts. Financial institutions should be on notice that they have a responsibility to detect suspicious activity and stop it in its tracks.”

The Treasury network describes the IRGC as a parallel organization to Tehran’s regular armed forces, which reports directly to the leader, Ayatollah Mojtaba Khamenei. The IRGC is a U.S.-designated foreign terrorist organization.

Shadow Banking

FinCEN says the IRGC can make money from oil sales by misrepresenting its commercial activities. It smuggles oil using a “shadow fleet” of vessels that operate outside normal maritime rules and are often owned and operated by companies outside Iran.

Proceeds are then laundered through “shadow banking” networks to sell their oil and commodities abroad.

“By using front company accounts outside Iran to receive and remit payments, sanctioned entities like the IRGC are able to conduct transactions through the international financial system without repatriating funds to Iran,” FinCEN said.

The network says that with these proceeds, Iran can fund the procurement and development of weapons, as well as fund terrorist activity abroad.

Sanctions on Iran

The alert comes after President Donald Trump said on May 11 that a ceasefire with Iran was on “life support.”

The president’s remarks follow Tehran’s proposal to end the war over the weekend.

“I would call it the weakest right now after reading that piece of garbage they sent us,” Trump told reporters at the White House. “I didn’t even finish reading it.”

A ceasefire between the United States and Iran went into effect in April, ending weeks of U.S. and Israeli strikes on the country that started on Feb. 28.

The Strait of Hormuz, a key transit point for oil and natural gas, has remained effectively closed in the meantime, sending oil prices surging and rattling stock markets worldwide.

In the meantime, the U.S. military has imposed a naval blockade on Iranian ports. The U.S. Central Command (CENTCOM) said on May 11 that 62 commercial ships have been redirected and four ships disabled as it enforced the blockade.

Also on Monday, the U.S. Treasury Department announced sanctions against 12 new targets as part of its “Economic Fury” initiative to disrupt Tehran’s economic and military capacity.

The Treasury said it had designated 12 individuals and entities for their roles in enabling the IRGC’s sale and shipment of Iranian oil to China.

“The IRGC relies on front companies in permissive economic jurisdictions to obfuscate its role in oil sales and funnel the revenue to the Iranian regime. Instead of using this revenue to support the struggling Iranian people, the regime directs it toward weapons development, backing terrorist proxies, and funding security forces that suppress citizens’ freedoms,” the Treasury said.

Joseph Lord and Jack Phillips contributed to this report.

Tyler Durden Wed, 05/13/2026 - 12:00

IEA Revises 2026 Forecast: Global Oil Supply To Plunge Below Demand This Year

Global oil demand is set to exceed supply in the current year amid the ongoing conflict in the Middle East, reversing previous projections of a surplus, OilPrice reports citing the latest IEA data.

"With Hormuz tanker traffic still restricted, cumulative supply ​losses from Middle East Gulf producers already exceed 1 billion barrels with more than 14 million (barrels per ⁠day) of oil now shut in, an unprecedented supply shock," said the agency, which advises industrialized countries.

According to the May 2026 Oil Market Report by the International Energy Agency (IEA), global oil supply is projected to fall by 3.9 million bpd across 2026, with ~10.5 million bpd of Gulf oil production currently offline.

Global oil stocks are depleting at a record pace as supply losses from disruptions to flows via the Strait of Hormuz keep mounting

Producers & consumers are responding to the market signals, with Atlantic crude oil exports surging & refiners cutting runs: https://t.co/cOYraM4phx pic.twitter.com/QWJlPICebi

— International Energy Agency (@IEA) May 13, 2026

Consumption is also under pressure due to the war as ​price spikes lead ⁠to demand destruction and slower economic growth: Global demand is also forecast to contract by 420,000 bpd compared to a ​previous forecast of an 80,000 bpd drop due to surging prices, slow economic growth and widespread flight cancellations, with oil demand still set to outpace supply by 1.78 million bpd in the current year.

"Our latest supply and demand estimates imply that the market will remain severely undersupplied through the end of 3Q26, even assuming the conflict ends by early June," the Paris-based agency said, adding that the second-quarter deficit will be as stark as ​6 million bpd.

Global crude runs are expected to plunge by 1.6 million bpd to an average of 82.3 mb/d for the year as operators face infrastructure damage and severe feedstock shortages, with refinery throughput expected to fall by 4.5 million bpd in the second quarter alone.

Operators in the Middle East and Asia are battling significant damage to energy infrastructure and reduced availability of crude feedstocks, largely stemming from the closure of the Strait of Hormuz. The heaviest cuts have been in the Middle East and Asia-Pacific, heavily impacting naphtha, LPG and jet fuel production.

According to the IEA, global oil inventories are projected to fall by an average of 8.5 mb/d during the second quarter of 2026, with the drawdown largely due to a decline in crude output from countries including Iraq, Saudi Arabia, Kuwait and the UAE.

The steepest inventory draws are projected to occur in May and June, helping to keep Brent crude prices elevated at ~$106 per barrel.

Whereas the release of a total of 400 million barrels by 32 IEA members is expected to provide a temporary buffer, the market will still face a significant deficit that could keep prices high through the year.

Tyler Durden Wed, 05/13/2026 - 11:00

'Obvious Dangers': Gabbard Probing US Funding To International Biolabs

Authored by Zachary Stieber via The Epoch Times,

U.S. Director of National Intelligence Tulsi Gabbard and other intelligence officials are investigating U.S. funding to overseas laboratories handling biological research.

Initial searches of intelligence files showed that the U.S. government has provided money to more than 120 biolaboratories in more than 30 countries, a spokesperson for the Office of the Director of National Intelligence told The Epoch Times in an email on May 12.

That includes biolabs in Ukraine that “may be at risk of compromise due to the ongoing Russia-Ukraine war” and other laboratories that have researched highly contagious pathogens, potentially including research that enhanced the pathogens’ virulence or transmissibility, with little visibility or oversight, according to the office.

The Department of Defense in a 2022 document said the United States had invested approximately $200 million since 2005 to support work at 46 Ukrainian laboratories, health facilities, and diagnostic sites.

Gabbard issued new guidance to officials that directs them to step up the collection of information on laboratories and related facilities outside the United States, which is already yielding new details on clinical trials being performed at the facilities, officials said.

The information has raised ethical, financial, and security concerns, according to the Office of the Director of National Intelligence.

“The COVID-19 pandemic revealed the catastrophic global impact research on dangerous pathogens in biolabs can have,” Gabbard said in a statement.

“Yet despite these obvious dangers, politicians, so-called health professionals ... and entities within the Biden administration’s national security team lied to the American people about the existence of these U.S.-funded and supported biolabs and threatened those who attempted to expose the truth.”

She said that the Trump administration is “working closely with partners across the government to identify where these labs are, what pathogens they contain, and what ’research' is being conducted, to end dangerous Gain-of-Function research that threatens the health and wellbeing of the American people and the world.”

The first COVID-19 cases were detected in 2019 near a biolaboratory in Wuhan, China, that received funding from the United States.

Gabbard’s investigation was prompted by a May 5, 2025, executive order from President Donald Trump that forbade federal funding from supporting risky research, or experiments aimed at increasing functions of a virus, unless proper oversight is in place.

Trump said in the order that “dangerous gain-of-function research on biological agents and pathogens has the potential to significantly endanger the lives of American citizens” and that the government had previously approved funding for research “in China and other countries where there is limited United States oversight or reasonable expectation of biosafety enforcement.” COVID-19, he said, “revealed the risk of such practices.”

Tyler Durden Wed, 05/13/2026 - 10:45

WTI Holds Gains Despite Biggest SPR Drawdown In 45 Year History, Production Jumped

Oil prices are higher this morning (extending its 8%-plus surge of the last three days) as Middle East tensions simmer and global stockpiles shrink at a record pace.

WTI topped $103 and Brent crude traded near $108 a barrel, erasing its retreat earlier on Wednesday, after the IEA said global observed oil inventories declined at a rate of about 4 million barrels a day in March and April.

Saudi Arabia told OPEC that its output sank to the lowest level since 1990.

“With global oil inventories already drawing at a record clip, further price volatility appears likely ahead of the peak summer demand period,” the Paris-based IEA said in its Oil Market Report.

The market will remain “severely undersupplied” until October even if the conflict ends next month, the agency said.

For obvious reasons, this morning's official inventory and supply data (for the US) is now top of mind.

API

• Crude -2.2mm

• Cushing

• Gasoline +502k

• Distillates -319k

DOE

• Crude -4.3mm (-2.5mm exp)

• Cushing -1.7mm

• Gasoline -4.08mm - 13th weekly draw in a row

• Distillates +190k - first build in 7 weeks

Crude stocks saw a bigger than expected drawdown last week (the third week in a row) as Cushing inventories drop and while Distillates saw a small build, Gasoline stocks plunged... again...

Source: Bloomberg

The drawdowns from the Strategic Petroleum Reserve continue to accelerate. The 8.6mm barrel draw was the largest on record...

Source: Bloomberg

US crude production jumped last week...

Source: Bloomberg

Crude exports jumped back up to near the 6 million barrel a day mark, rising 742,000 barrels to around 5.5 million barrels a day. Anything above 4 million barrels a day is generally considered robust demand and in recent weeks the US sets its all-time record for crude exports as the Iran war disrupts flows globally. 

Imports of Venezuelan crude soared to 598,000 barrels a day, the highest since early 2019 when the US first imposed a de facto ban on oil imports from the country. 

Refinery runs bounced back in a big way and are now just shy of levels seen at the same time last year as maintenance season wraps up.

Valero Port Arthur was finally able to restart its largest crude unit, following a end-March fire, helping to bolster crude processing in the region. 

WTI extended gains, topping $103.50 this morning, as Martijn Rats, commodities strategist at Morgan Stanley, told clients in a Monday note: "That this is the largest oil supply disruption in the history of the oil market is neither an exaggeration nor controversial."

Morgan Stanley forecasts the market will lose another billion barrels over the course of 2026 due to the time required to restart oilfields, repair refineries and reposition the tanker fleet'

“We expect this destocking environment to continue over the next number of months and ultimately drive a restocking phenomenon longer-term,” Plains All American Pipeline LP Chief Executive Officer Willie Chiang said on an earnings call Friday. 

Tyler Durden Wed, 05/13/2026 - 10:37

Chinese Supertanker Sails Out Of Hormuz In Rare Exit

As president Trump was on his way to China, a Chinese tanker appears to have exited the Strait of Hormuz as it sails toward an area where the US has enforced a blockade, ahead of talks between US President Donald Trump and counterpart Xi Jinping, Bloomberg reported today, citing ship-tracking data showing the VLCC moving south along the eastern side of the chokepoint.

The supertanker which sailed past Iran’s Larak island, and into the Gulf of Oman, is Yuan Hua Hu, owned by Cosco, and would be only the third tanker carrying oil for China from the Persian Gulf that has traversed Hormuz since the start of the war. The vessel is broadcasting its Chinese origin and crew, Bloomberg said, as other vessels have done previously to secure safe passage.

Yuan Hua Hu’s draft indicates it’s fully loaded with oil, or close to the vessel’s 2 million barrel capacity. It was seen lifting from Iraq’s Basrah terminal in early March, according to ship-tracking data. The vessel was chartered by Unipec, the trading arm of Chinese state refining giant Sinopec, according to a fixture seen by Bloomberg.

In April, two very large Chinese crude carriers were allowed to pass the Strait of Hormuz under Iran’s toll system that demands payment of $2 million per supertanker to pass. One of those was the same Yuan Hua Hu that is currently moving along the strait.

China imports the bulk of its energy from the Middle East, and while it has amassed substantial crude oil stockpiles that are helping it weather the worst of the crisis - anecdotally over 1.4 billion barrels - restoring normal flows from the Persian Gulf is important for one of the world’s top energy importers.

Earlier in the war, reports emerged that Beijing had pressured Iranian officials to stop attacking vessels carrying crude oil and LNG via Hormuz. Judging from later events that involved Iranian strikes on vessels in the chokepoint, Tehran did not yield to the pressure.

The moment is delicate for relations between the United States, China, and Iran as President Trump heads to Beijing for talks with President Xi on topics that are bound to include traffic via the Strait of Hormuz. According to media reports, President Trump plans to have “a long talk” with President Xi about Iran, even as he told news agencies he did not need China’s help in resolving differences with Iran.

Tyler Durden Wed, 05/13/2026 - 10:10

Two Empty Qatari LNG Tankers Head Toward Gulf After Weekend Hormuz Transit Breakthrough

Bloomberg ship-tracking specialist Stephen Stapczynski has identified two empty Qatari LNG tankers, Al Gattara and Fraiha, transiting north toward the Gulf area after idling near Mauritius.

This movement comes just days after a Qatari LNG carrier successfully transited the Strait of Hormuz, suggesting that Doha may be engaged in backchannel discussions with Tehran about a gradual normalization of LNG flows through the maritime chokepoint.

Al Gattara and Fraiha could be returning to Qatar to load LNG cargoes. If confirmed, this would mark a notable development after a Qatari LNG tanker sailed through the Hormuz chokepoint over the weekend, the first seaborne LNG export from Qatar since the war began in late February. However, no empty Qatari LNG tankers had yet returned through the critical waterway for loading operations.

As of Wednesday, Hormuz tanker flows remain highly disrupted, as the U.S. and Iran have yet to agree on a deal. President Trump landed in China earlier today, and the Trump-Xi summit will focus on unfreezing the world's most critical waterway.

Polymarket:

//--> //--> Strait of Hormuz traffic returns to normal by end of May?
Yes 8% · No 93%
View full market & trade on Polymarket

We have pointed out that a one-month countdown is underway. If Hormuz traffic does not resume, the real energy crisis will begin after June. 

Tyler Durden Wed, 05/13/2026 - 09:40

The post Trump Accounts and the No Economist Left Behind Test appeared first on CEPR.

Trump Mulls 'Operation Sledgehammer' If Ceasefire Collapses, But Iran Has Re-Armed

The Pentagon is considering renaming the war with Iran from "Operation Epic Fury" to "Operation Sledgehammer" if President Trump orders a renewed full-scale bombing campaign against Iran, according to an NBC News report published Tuesday.

The report came on the eve of day 75 since the US and Israel launched the conflict. US sources touted to NBC that the United States now has greater military capabilities in the region than it did before the US and Israel launched the war on February 28. But US intelligence is now also suggesting Iran's missile capability is getting back up and running as well.

US Navy file image

After Iran had clearly withstood the shock and destruction of the opening days and couple weeks of major American and Israeli bombing raids over its cities and airbases, Trump belatedly ordered more warships, carriers, and troops into the region (Marine Expeditionary Force) - after which the blockade of Iranian ports was eventually put in place.

Now amid the heavier US naval and combined forces build-up in the CENTCOM area, "We are in a better spot now than on February 27," a US official said to NBC. "We have more firepower and capability."

The reported name change appears part of the Trump administration's effort to navigate around the War Powers Resolution, which is the 1973 law designed to limit executive war powers and reinforce Congress's constitutional authority to declare war.

According to NBC, the name change would be to underscore how seriously the administration is considering resuming the war, and could allow Trump to argue that it restarts the 60-day clock that requires congressional authorization for war, by way of the name change loophole.

While Republicans hold control of the Senate and have a slim majority in the House, there have lately been signs of bipartisan frustration at how the war is going, and the coming financial impact on the American public.

Also, even though the Pentagon has its assets in place if fighting were to resume, fresh reporting in NY Times and elsewhere indicates that Iran too has re-armed and regrouped.

"U.S. Intelligence Shows Iran Retains Substantial Missile Capabilities. Secret new assessments say Iran has operational access to 30 of its 33 missile sites along the Strait of Hormuz, suggesting that its military remains far stronger than President Trump has asserted," NY Times reports.

The report also indicates, "The Trump administration’s public portrayal of a shattered Iranian military is sharply at odds with what U.S. intelligence agencies are telling policymakers behind closed doors, according to classified assessments from early this month that show Iran has regained access to most of its missile sites, launchers and underground facilities."

This further opens up the possibility that US forces could sink into protracted quagmire should the White House choose to escalate the conflict through a renewed bombing campaign, or else launching some kind of ultra high-risk ground operation to recover Iran's nuclear material.

Interesting how U.S. intelligence reports are fluctuating, one moment Iran’s military is obliterated, another it’s retaining its capabilities. No leadership, then reports of serious cracks in the system, then a conclusion that Mujtaba is consolidating power. That’s completely… https://t.co/3iZAfMhZel

— Ali Hashem علي هاشم (@Alihashem) May 12, 2026

Trump is still insisting on taking Iran's "nuclear dust" out of the country, but how that precisely happens is anyone's guess - and would likely prove to be a long shot.

On Tuesday, speaker of Iran's parliament, Mohammad Bagher Ghalibaf, said  his country's military stands ready to "teach a lesson" to any aggressor as Trump has said the ceasefire is hanging by a thread. "Our armed forces are ready to respond and to teach a lesson for any aggression," he said on social media. "A bad strategy and bad decisions always lead to bad results - the world already understands this."

Tyler Durden Wed, 05/13/2026 - 08:50

Yields Spike As Producer Prices Explode Higher In April

After yesterday's hotter than expected CPI (driven in large part by Energy, but seeing some contagion into Services costs), this morning's Producer Price print for April was expected to show a major surge in annual wholesale inflation.

With the eight straight monthly increase, PPI rose by a massive 1.4% MoM (vs +0.5% MoM exp) - the biggest MoM jump since March 2022, lifting PPI by a stunning 6.0% YoY (vs 4.8% YoY exp). That is the hottest PPI YoY since Dec 2022...

Source: Bloomberg

Services and Energy saw the biggest rise (while construction costs actually deflated very modestly)...

Core Producer Prices spiked 1.0% MoM (more than triple the +0.3% exp) smashing Core PPI YoY up 5.2% (also the hottest since Dec 2022)...

Source: Bloomberg

And finally, one could argue this is as bad as it gets for the energy component as oil prices have stabilized...

Source: Bloomberg

But of course, the pipeline of those energy costs is perhaps only just starting to trickle into the rest of the economy.

PPI triggered a spike in 2Y yields...

Now back above 4.00% at their highest since March with the market now pricing in a 50% chance of one rate-hike in 2026...

It appears any chance of Warsh cutting rates (as per Trump's expectations) are off the table... for now.

Finally, there is perhaps a silver lining from this ugly PPI report. Other than airfares (which rose 3%) the components that feed through into PCE inflation were pretty tame; portfolio management fees dropped 2.4% and the various medical-care components showed a maximum rise of 0.3%.

That may mitigate the impact of the report, but it’s still hard to totally ignore the risk that inflation becomes a more pressing concern moving forward. 

Tyler Durden Wed, 05/13/2026 - 08:40

UK Risk Spreads Oddly Calm As PM Starmer Faces Growing Threat Of Ouster

Wes Streeting is reportedly poised to resign as UK health secretary and launch a formal challenge to UK PM Keir Starmer in a Labour Party election.

Following a meeting with Starmer in Number 10 (which lasted just 16 minutes), an “ally” of the health secretary told The Times that Streeting was “going to go for it”.

Around 100 Labour MPs have publicly called for Starmer to resign although a similar number of lawmakers have urged challengers to hold back from launching a leadership bid.

Starmer’s leadership is hanging by a thread after Labour lost nearly 1,500 councillors across English councils and were defeated by nationalist parties in Wales and Scotland.

A slew of ministerial resignations have so far failed to force Starmer’s downfall this week.

As Bloomberg reports,s everal allies of Streeting have been among those to say he should go, leading lawmakers to conclude that he is attempting to build pressure against the premier ahead of announcing a challenge.

“I think it’s being a bit over dramatized,” Starmer loyalist Nick Thomas-Symonds said on BBC Radio 4 on Wednesday, ahead of Starmer’s meeting with Streeting.

“Anyone would think we were talking about the final scene at Casino Royale or something.”

Trade unions have joined the calls for change.

“It’s clear that the Prime Minister will not lead Labour into the next election, and at some stage a plan will have to be put in place for the election of a new leader,” unions affiliated with the party said in a statement published Wednesday morning.

In a statement alongside the King’s Speech this morning, Starmer said the country stood at a “pivotal moment”.

He said multiple crises had meant that the “status quo had repeatedly made working people pay the price”.

“This time must be different. And this King’s Speech shows it will be different with a plan to make this country stronger and fairer.”

Starmer’s move was seen as effectively daring his opponents to come out and publicly challenge him, a position that his deputy, David Lammy, put voice to in Downing Street on Tuesday evening.

“It’s been 24 hours now, and nobody has come forward to put themselves forward in the processes that exist in the party,” Lammy told reporters.

“No one seems to have the names to stand up against Keir Starmer, and for those who are suggesting that he should stand down, they should say which candidate would be better.”

Interestingly, the odds of a Starmer resignation in the short-term (by the end of May) have tumbled...

...while the odds of him leaving by year-end have soared...

And while the UK is in the midst of a political crisis that could see off its sixth Prime Minister in only a decade, Bloomberg's Simon White notes that risk spreads are remarkably contained.

A measure including UK asset swap spreads, gilt spreads, bank CDS, sterling, etc, is only modestly wider and is below where it was on the outbreak of the Iran war, Chancellor Rachel Reeves’ first budget, and the ill-fated, short-lived premiership of Liz Truss.

Gilt yields are indeed higher, and are so across the curve, which is suggestive of extra risk premium for holding UK debt.

“I am underweight gilts,” said Shinji Kunibe, a portfolio manager at Sumitomo Mitsui DS Asset Management Co. in Tokyo.

“Yields have already risen beyond Truss-era levels, so they’re attractive if we see any positive signals. But with so much uncertainty, I doubt anyone is willing to touch gilts right now.”

However, that has happened to other countries too - albeit to a lesser extent - due to the energy shock, muting the spread impact on the UK.

“I’d love to buy them because obviously long-end yields are so enticing on paper,” the chief multi-asset strategist at HSBC said in an interview on Bloomberg radio.

But with a potential challenge to Prime Minister Keir Starmer’s leadership keeping volatility high, “right now, gilts are a half-hour trade.”

There is also perhaps a hope that in the gilt market that the potential replacements for Keir Starmer are beginning to preach greater fiscal orthodoxy, if recent political commentary is to be believed.

Tyler Durden Wed, 05/13/2026 - 08:25

Bessent's "Suffocating" Iranian Regime Strategy Materializes In Kharg Island Satellite Imagery

Treasury Secretary Scott Bessent's description of "suffocating" the Iranian regime through economic and financial pressure, whether via sanctions or the US military blockade of the world's most critical maritime chokepoint, now appears to be showing up in the data.

New geospatial intelligence indicates that Iran's main crude export terminal has gone quiet, while a separate report suggests seaborne oil exports have effectively been halted for the past month.

The first report comes from Bloomberg, which cited European satellite imagery showing a massive bottleneck developing at Iran's energy complex: no ocean-going tankers at Kharg Island, the country's main export terminal, on May 8, 9, and 11. This marks the longest stretch in no crude tanker loadings since the US-Iran conflict began nearly three months ago.

Kharg Island’s loading terminals were observed completely empty yesterday for the first time since mid-April, despite 19 tankers waiting nearby with ~25M bbl of capacity.

A recent 80,000 bbl oil slick suggests sustained infrastructure damage has halted all crude departures since… pic.twitter.com/6EKKigQghP

— Windward (@WindwardAI) May 12, 2026

Iran continued loading crude throughout the early weeks of the war, using tankers as floating storage after the US Navy effectively blocked ships from exiting the Hormuz chokepoint in mid-April, creating a massive energy bottleneck for Tehran. 

At the end of last week, we reported that a massive oil leak spanning dozens of square miles of water was spotted off Kharg Island. This was based on open-source satellite imagery.

Image source: Soar

"The slick appears visually consistent with oil," said Leon Moreland, a researcher at the Conflict and Environment Observatory, to Reuters. He believes it covers an area of approximately 45 square km (nearly 18 sq miles).

While it's unclear what may have caused it, or the extent of possible damage to Kharg Island's infrastructure or possibly docked tankers, the island has been attacked by US aerial forces in the recent past.

If Kharg Island remains idle and storage capacity reaches its limit, Iran could be forced into deeper oil production cuts.

"To our best knowledge, Iran hasn't successfully exported any crude oil by sea over the past 28 days. Some refined products managed to escape because US OFAC did not slap sanctions on those tankers," research firm Tanker Trackers wrote on X. 

To our best knowledge, Iran hasn't successfully exported* any crude oil by sea over the past 28 days. Some refined products managed to escape because US OFAC did not slap sanctions on those tankers.

In addition, Kharg Island hasn't loaded any tankers since 2026-05-06 as a result…

— TankerTrackers.com, Inc. (@TankerTrackers) May 12, 2026

This very development would support Bessent's claims: "We are running a marathon over the past 12 months, and now we are sprinting toward the finish. They are not able to pay their soldiers. This is a real economic blockade."

Ten days ago, Bessent forecasted that Iran's oil industry may need to start shutting in wells "in the next week" as the country's crude storage is "rapidly filling up."

"Their oil infrastructure is starting to creak," he said. "It hasn't been maintained again because of our decades-long sanctions against them."

Tyler Durden Wed, 05/13/2026 - 08:10