Guggenheim Loan Craters, Fund Hits GFC Lows As Feds Probe Walter's Empire

A first-lien loan due in 2031 tied to Guggenheim Investments, the asset-management arm of Mark Walter's Guggenheim Partners, cratered to roughly 72 cents on the dollar Monday, according to Bloomberg data. The hefty discount suggests that lenders remain unconvinced by management's efforts to contain mounting fears over deteriorating earnings, accounting practices and ongoing federal investigations into Walter's financial empire.

The $1.18 billion loan, issued by GIH Borrower LLC, dropped to a low of 72 cents on the dollar Monday morning. 

Walter's Guggenheim Partners reported a 38% year-over-year decline in second-quarter revenue last week. Management told investors that much of the deterioration was attributable to delays in recognizing advisory fees at Guggenheim Private Investments.

Shares of the Guggenheim Strategic Opportunities Fund are crashing to their lowest level since the Global Financial Crisis.

The loan market, however, appears to be delivering some bad news. Because Walter's businesses are privately held, the declining value of Guggenheim's loan offers investors a real-time indicator of concerns surrounding how Delaware Life Insurance Co. and its affiliate, Clear Spring Life and Annuity, two Group 1001 insurers, labeled about $20 billion in loans to companies within Walter's empire.

The insurers reclassified billions of dollars in investments as affiliated or related-party transactions after receiving grand jury subpoenas and conducting internal reviews. Lending to affiliates is not illegal, but it must be properly disclosed.

Related:

1. FBI Seized Mark Walter's Devices Months Before Record $12.5 Billion Lakers Sale

2. "Cash Crunch" Deepens? Mark Walter Explores Chelsea FC Stake Sale To Clearlake

3. Mark Walter Probe Puts Wall Street's Insurance-Private Credit Machine Under DoJ Scrutiny

CNBC reported that Walter's TWG Global holding company has tapped veteran Goldman Sachs lawyer David Markowitz to serve as its chief legal officer amid the federal probe.

Tyler Durden Tue, 08/25/2026 - 13:20

Treasury, IRS Propose Rules On Trump Account Investments

Authored by Naveen Athrappully via The Epoch Times,

The Department of the Treasury and the IRS have issued proposed regulations clarifying which investments may be made by Trump Accounts.

President Donald Trump speaks during the Trump Accounts summit at the Andrew W. Mellon Auditorium in Washington on Jan. 28, 2026. Madalina Kilroy/The Epoch Times

A Trump Account is a savings account designed to help children get a head start on financial wellness. It can be opened in the name of any individual younger than 18 with a valid Social Security number.

Funds in these accounts can only be invested in "eligible investments" during the growth period, referring to the period beginning from setting up the Trump Account to Dec. 31 of the calendar year in which the beneficiary becomes 17 years of age, the IRS said in an Aug. 20 statement. After the growth period, these eligible investment restrictions won't apply.

An eligible investment is either a mutual fund or an exchange-traded fund (ETF) that tracks the returns of a qualified index, according to the proposed rule notice published by the IRS on Aug. 21 in the Federal Register.

A qualified index means the S&P 500 index or any other index composed of equity investments in mainly U.S. companies and for which regulated futures contracts are traded on an exchange or board of trade.

Indexes that solely focus on specific sectors or industries won't be deemed a qualified index, the notice clarified. However, indexes based on companies' market capitalization can qualify.

A mutual fund or ETF must not use leverage in order to qualify as an eligible investment, according to the proposal. They must also not have annual fees and expenses of more than 0.1 percent of the investment balance.

Around 85 million children from 44 million families across the United States are expected to be impacted by the proposed regulations, the notice said.

In its statement, the IRS said that if an account beneficiary does not select an eligible investment offered by the account's trustee-institutions managing the accounts-then the funds will automatically be invested in eligible investments selected by the trustee during the growth period.

The Treasury and the IRS are seeking comments on the proposed rules, which are due by Oct. 20. The regulations, once in effect, will apply to tax years starting on or after Jan. 1, 2026.

"These proposed regulations will provide clarity for trustees and beneficiaries of Trump Accounts, thus encouraging eligible participants to invest in low-fee mutual funds and ETFs that will grow on a tax-deferred basis potentially over their entire lives," IRS Chief Executive Officer Frank J. Bisignano said in the statement.

"Funds deposited in Trump Accounts enable American children to start investing now and enjoy years of compound earnings for their future college, retirement and other needs."

Account Investments

According to estimates on the Trump Account website, $1,000 deposited at the time of a child's birth could grow to $6,000 by the time the child turns 18, even if no additional contributions are made.

If $250 is contributed annually, the fund could grow to $19,000. Under the maximum $5,000 annual contribution, the fund value could reach $271,000 at age 18.

In early July, the White House said that almost 6 million Trump Accounts had been opened.

In an Aug. 20 statement, the Treasury said the proposed regulations aim to keep investment costs low and help children's savings grow over the long term.

Investment fees and expenses can reduce account balances over time. The proposed rules limit investments to funds with low expense ratios and avoid those with excessive fees.

"Every dollar in a child's Trump Account should be working toward that child's financial future, not diminished by unnecessary fees," Treasury Secretary Scott Bessent said in the statement.

"Under President Trump's leadership, Treasury is putting simple, commonsense protections in place to help families keep more of their investment returns."

In a July 1 statement, the Treasury announced that the State Street SPDR Portfolio S&P 500 ETF would be the default investment for all contributions to Trump Accounts.

Parents or guardians of Trump Accounts can choose to invest funds in four additional low-cost index ETF options-iShares Core S&P 500 ETF, Vanguard Total Stock Market ETF, State Street SPDR Portfolio S&P 1500 Composite Stock Market ETF, and iShares Core S&P Total U.S. Stock Market ETF.

Tyler Durden Tue, 08/25/2026 - 13:00

Ghislaine Maxwell To Rot In Prison After Judge Denies Bid For New Trial

Jeffrey Epstein accomplice Ghislaine Maxwell gets to rot in prison until 2037 after a judge on Tuesday denied her bid to overturn her sex trafficking conviction and hold a new trial. 

"Nearly all its claims are procedurally barred; the overwhelming testimonial and documentary evidence adduced at trial conclusively established her guilt; and her petition's claims are demonstrably meritless, and generally based on speculation, distortions, and/or outright falsehoods," Judge Paul A. Engelmayer of the U.S. District Court for the Southern District of New York said in the 67-page decision.

"There is no fact that Maxwell fairly puts in dispute that has any potential to disturb the outcome of her trial."

Maxwell, 64, was Jeffrey Epstein's right-hand, who procured minor girls for prostitution. She faced multiple other charges when Epstein died in prison in 2019, stemming from her activities between 1994 and at least 2004, according to documents and other evidence introduced at her trial.

As the Epoch Times notes further, Maxwell was convicted in 2021 of participating in a conspiracy with Epstein that targeted minors for illegal sex acts. She is serving a 20-year prison sentence.

A federal appeals court in 2024 upheld the sentence, and the Supreme Court in 2025 denied Maxwell's request to review that ruling.

Maxwell said, in a petition filed under Section 2255 of the U.S. Code to overturn her conviction, that the release of materials following the appeal process should result in her conviction being vacated, including a transcript of testimony given to a grand jury in 2006 by a police detective who investigated Epstein.

The detective said then, according to the transcript, that a massage table was in a bathroom. Maxwell said that the detective testified that it was the north bathroom, which was different from the south bathroom he had identified at her trial.

The detective did not actually specify a bathroom in the 2006 testimony, though, the judge said in the new ruling.

Even if he had offered conflicting testimony as to the location of the massage table, Maxwell did not show that it would have been perjury rather than an inadvertent mistake.

"And had there been such an inconsistency between Detective Parkinson's 2006 and 2021 testimony as to this particular, such would have been highly unlikely to impeach Detective Parkinson's credibility, given that the search had occurred more than 16 years before his trial testimony, and his testimony in general, and about finding the massage table in the house in particular, was corroborated by other testimonial, documentary, and video evidence," the judge said.

That means it would not have had "a material effect on the outcome of the trial," he said.

Tyler Durden Tue, 08/25/2026 - 12:45

New Home Sales Collapsed In July As Consumer Confidence Hit 7-Month Lows

The Conference Board's measure of Americans' Consumer Confidence fell from a revised-lower 90.2 to 89.4 in August (below the 90.2 exp) - the lowest since January.

Interestingly, under the hood, we saw Expectations plunge to January lows while Present Situation spiked from 5 year lows...

“Consumer confidence moderated slightly in August for a second consecutive month,” said Dana M Peterson, Chief Economist, The Conference Board.

“The Expectations Index slipped further into negative territory, which was offset by a moderate rise in the Present Situation Index after declining in the past three months. Consumer appraisals of current business conditions were mildly positive. Perceptions of the current labor market improved, reversing three months of moderate decline. Looking ahead, consumers were more pessimistic about business conditions and the labor market over the next six months. Expectations for household incomes moderated but remained optimistic overall.”

On a six-month moving average basis, confidence across all age groups trended down slightly, remaining highest among consumers under 35.

By income, confidence was mixed, but generally higher-income groups were more optimistic.

By generation, confidence for Gen Z remained the highest, followed closely by Millennials on a six-month moving average basis. The three oldest generations—Generation X, Baby Boomer, and Silent Generation—trailed in confidence by a wider margin.

By political affiliation, confidence among Independents and Republicans softened while Democrats were somewhat more positive in August.

Consumers’ write-in responses on factors affecting the economy were slightly more pessimistic in August.

References to prices in general—and oil and gas specifically—remain elevated. Comments about war/conflict, food/groceries, trade, and jobs rose in August. Consumers’ average and median 12-month inflation expectations were slightly more elevated in August. Most consumers—61.3%—still anticipated higher interest rates over the next 12 months, down moderately from 62% in July. Meanwhile, consumers still expected higher stock prices a year from now.

On a six-month moving average basis, auto purchasing expectations remained strong. Homebuying expectations declined slightly for the month but maintained an upward trend after slumping to decade-lows in early 2024. 

Perhaps reflective of the weak confidence (especially 'Expectations'), new home sales plunged 10.5% MoM in August (after an upwardly revised +7.6% bounce in July). That dragged new home sales down 6.3% YoY...

Total new home sales SAAR dropped back to 607k - basically flat since 2016...

Sales have fallen in three of the last four months, adding to evidence of a housing market burdened by elevated finance costs and prices.

However, on the potential bright side for homebuyers and affordability, median new home prices fell to a five-year low...

Interestingly, while median new home price just dropped to a 5 year low, the average new home price hasn't budged as ultra high end homes keep lifting the average...

While builders have had some success bolstering demand with free upgrades, mortgage rate buydowns and price reductions, the entry-level market remains affordability-constrained, and likely stays there until consumer confidence rebounds (which is highly dependent on the price of gas, among other things).

Tyler Durden Tue, 08/25/2026 - 10:13

The post Confusion on Debt and Deficits: Let’s Go Back to Third Grade and Get This Straight appeared first on CEPR.

Is ICE Investigating Ilhan Omar? Trump 'Truths' Report On Withheld Fraud-Probe Records

President Donald Trump drew fresh attention to a long-running controversy on Sunday when he reposted a Just the News article on Truth Social headlined "ICE refuses to disclose records on Ilhan Omar fraud probe, cites ongoing 'enforcement proceedings.'" His decision to amplify the report, without comment, renewed scrutiny of allegations that have dogged Rep. Ilhan Omar (D-Minn.) for years - though ICE's response stops short of confirming she is personally the target of any active proceeding.

The Trump administration has said for months it possesses evidence that Omar committed immigration fraud. What has remained unclear is whether that evidence translates into an indictment, a denaturalization proceeding, or nothing at all.

Just the News filed a Freedom of Information Act request in January 2026 for records related to Omar's marriage to Ahmed Nur Said Elmi, a man whose identity, evidence suggests, is that of her brother. ICE's response cited a specific legal exemption rather than denying or providing a timeline. "ICE has determined that the information you requested is being withheld in full pursuant to Title 5 U.S.C. § 552(b)(7)(A)," the agency wrote. "Disclosure of any responsive records at this time could reasonably be expected to interfere with enforcement proceedings."

Department of Justice guidance requires a two-step showing before an agency can invoke it. "First, there must be a 'reasonable likelihood' of a pending or contemplated law enforcement proceeding," the guidance states. "Second, release of the information must be reasonably expected to cause some articulable harm to that proceeding." ICE cleared both hurdles by its own estimation; whether that estimation holds up matters more now that the president has amplified it himself.

While no court has established as fact that Ahmed Nur Said Elmi is Omar's brother, the most detailed public claim comes from the government of Somaliland. This territory, which split from Somalia in 1991, claimed back in March that Omar's original last name was Elmi before it was changed, and that this evidence "was available, but the Obama Justice Department refused to investigate."

The allegations that Omar married her brother first surfaced during Omar's 2016 campaign for a seat in the Minnesota House, alongside a separate claim that she remained legally married to her first husband when she married Elmi.

Omar was born in Somalia and lived in a refugee camp in Kenya before coming to the United States in 1995. She applied for a marriage license with Ahmed Hirsi in 2002 but never married him civilly, only through a Muslim ceremony. The two separated in 2008. Omar married Elmi the following year, then split from him in 2011 through another Muslim divorce. She resumed her relationship with Hirsi in 2012, a year before she won her seat in the Minnesota House. Omar did not file for a formal divorce from Elmi until 2017, and she married Hirsi civilly in 2018, sixteen years after they first applied for that license.

Omar's campaign denied both allegations against her. "Allegations that she married her brother and is legally married to two people are categorically ridiculous and false," said then-campaign spokesman Ben Goldfarb.

Tyler Durden Tue, 08/25/2026 - 09:40

US Home Prices Are Rising At Their Fastest Pace In A Year

Following its unexpected rebound in May (from three months of declines), US home prices in America's 20 largest cities were expected to rise again (+0.1% MOM) in June (according to the latest data from S&P Cotality Case-Shiller).

Instead prices actually accelerated more, up a sizable 0.24% MoM, pulling home prices up 2.1% YoY - the fastest acceleration in a year...

“Seasonal factors continue to support monthly price growth," said Rebecca Kaufman, Associate Director of Commodities at S&P Dow Jones Indices.

"Because June typically falls near the peak of the homebuying season, price appreciation often moderates and market activity cools in the months ahead."

 

For the fourth consecutive month, Chicago led all metros with a 6.9% annual increase in June, followed by New York (4.8%) and Cleveland (4.1%).

Meanwhile, Seattle recorded the largest annual decline at 2.0%, followed by Las Vegas (-1.9%) and Denver (-1.2%).

"This geographic divide reflects a years-long trend, with housing markets in the Northeast and Midwest regaining strength while many Western and Sunbelt markets soften," says Kaufman.

Prices remain oddly coupled with Fed Reserves, implying stability, rather than acceleration, from here...

“The housing market remains under pressure, with 30-year mortgage rates holding near 6.5% in June,” Kaufman concluded.

“As financing costs are kept high for prospective buyers, current homeowners remain reluctant to give up the low mortgage rates secured in prior years.”

Tyler Durden Tue, 08/25/2026 - 09:09

Oil Falls Further As US Prepares Return Of Diplomats To Mideast Embassies

There continue to be clear signals that the White House is moving away from the potential for renewed military action and instead settling in for a long economic siege campaign targeting Iran, on a permanent basis.

The avoidance of more bombs away and with all the risks and uncertainty of a military 'solution' has seen oil prices drop. Energy prices are weakening also amid positive signals from Pakistan's army chief Field Marshal Asim Munir, who just left Tehran after carrying a fresh US-drafted framework. Crude oil prices (WTI) dropped 3% to just below $82.50 a barrel on Tuesday, extending the 2.4% decline recorded in the previous session.

The US Embassy in Qatar, via State Dept/Stars & Stripes

Al-Arabiya is reporting that he presented an offer to lift sanctions under the MOU, so long as Iran reopened the Strait of Hormuz and halts all hostile actions against Gulf states.

Munir had spoken to Trump by phone before travelling to Tehran, which underscores the high-level nature of the reported offer. Other top Pakistani officials accompanied him:

Pakistan and Iran made "significant progress" in talks that focused on the US-Israeli war on Iran and a path to peace, Pakistan’s interior minister said on Tuesday, at the end of a visit to Tehran.

Pakistan's Interior Minister Mohsin Naqvi subsequently stated on X, "The Iranian President candidly shared his government’s perspective and we had a very constructive exchange on the issues involved."

While it's unclear what Tehran's response will be, the last days have not seen new Iranian attacks on shipping in the Hormuz Strait. 

Still, Tehran is proclaiming that Washington's shift is a result of military defeat. On Tuesday Al Jazeera is citing IRGC spokesman Sardar Mohebi, who says the Trump administration's intensified economic campaign against Iran is proof that the US has failed on the battlefield.

He calls the move toward Operation Economic Outcast a "tacit admission" of America's military defeat in the region. As evidence for this the Iranians are pointing to US media admissions that pretty much all of the Pentagon's Gulf outposts have suffered damage or serious destruction, and US forces have pulled back. Even bases in Jordan have been hammered in what some analysts have called a successful campaign of 'debasification'.

But in another sign that Washington is moving away from a war-footing and instead opting for a long economic campaign, it is said to be readying the return of diplomats to the region. Another result of the fierce Iranian retaliation amid Operation Epic Fury had been the closure of US embassies and consulates across the region - which in some cases may have even been targeted.

"The State Department is preparing to send U.S. diplomats back to embassies in the Middle East that were evacuated before and during the war with Iran, suggesting that the Trump administration does not anticipate a return to all-out hostilities," the NY Times reports Tuesday.

"The return of foreign service officers and the scaling back of emergency measures taken at U.S. missions in the Middle East could begin this week, according to an internal State Department document obtained by The Times," the publication continues.

In Bessent's secondary sanctions rollout presser on Monday, he slipped up the below off-the-cuff moment when he called on a random journalist, who asked an excellent question:

Reporter: You described this as an economic D-Day, but D-Day wasn't a threat of an invasion and the US didn't give a timeline to Germany. So why not impose the sanctions today?

Bessent: Why would I want to blow up the global financial system? pic.twitter.com/WRt4onNuIM

— Acyn (@Acyn) August 24, 2026

Of course, nothing is yet certain and the situation remains very fluid, with the Iranians having previously demonstrated willingness to assert new leverage through attacks. According to details in the NY Times:

The restaffing is set to proceed even though talks between the United States and Iran have floundered, leaving the Trump administration to threaten new economic sanctions.

Embassies slated to restore higher levels of staffing include those in Israel, Lebanon, Saudi Arabia, Qatar, Jordan, Oman, Iraq and Kuwait, the document says.

The State Department issued a statement saying it "continuously reviews the security posture at our diplomatic missions around the world. Based on our latest assessment, we are adjusting our staffing posture at certain posts in the Middle East to ensure we can continue advancing U.S. foreign policy objectives while protecting the safety and security of our personnel."

But at this moment, embassies across the Gulf as well as Jordan remain shuttered, with most diplomatic personnel having been removed to other State Department posts.

Tyler Durden Tue, 08/25/2026 - 09:00

Are Canada's Economic Threats Against The US Legit Or Are They Bluster?

In order to "win" a trade war, a country must first have something that other countries want or need.  This basic rule defines every other aspect of the conflict, from tariffs to monetary isolation.  When it comes to the US there has long been a misconception that Americans "feed off global labor" and that the dollar's world reserve status is the country's only point of leverage. 

This is not really the whole story. 

Reserve status is helpful, but another thing the US has that most countries do not is (greater) free market access, which generates economic momentum.  In other words, even in blue states like California, the US does business more freely and has less socialist regulation than the vast majority of the world and this is why foreign exporters see America as a golden market for their goods.

It's a bit ironic, but, there are many countries that could, over time, match or surpass the US as a coveted consumer market; "winning" a trade war by becoming more independent and successful.  However, none of them will do it because this would mean giving more freedom to their citizens to purchase what they like and operate businesses without constant bureaucratic constraints.

This is why socialism and communism will always lose in an economic war with a country that has free markets.  They cannot compete because they restrict their own population's ability to compete.  Without a healthy consumer market the only thing these nations can do is produce and export to more free economies willing to buy. 

“We need to fight these tariffs dollar to dollar” -Doug Ford

“As Donald trump is trying to inflict pain on every Canadian, that we inflict pain right back” -Also Doug Ford@fordnation a question which you seem to have not contemplated:

What happens when you fight “dollar to… pic.twitter.com/5gD4O8HjiW

— Viva Frei (@thevivafrei) August 24, 2026

Tariffs might be viewed as an anathema to this free market flow.  They are, after all, a tax on corporations importing foreign goods.  This assumes that corporate sourcing can't adapt.  This has proven false as Trump's tariffs have not led to the inflationary spike that many critics predicted.  Tariffs have only added around 0.5% to the CPI and companies are gradually shifting to domestic suppliers.    

America is unique because for decades the country has been treated as an "open air market" by foreigners, and America has obliged them.  Tariffs against US made goods are common; US tariffs against foreign goods? No so much.

It's quite revealing that the very moment the Trump Administration took action to enforce even moderate protections on US trade, every other government jumped directly to accusing Trump of "attacking them" and "declaring war".  The double standard is obvious:  Everyone else can use tariffs, the US can't. 

Canada, for example, has used tariffs on goods from almost every other country in the world for many years, including some US goods.  No one accuses Canada of "waging war" on the world, because no one is clamoring to get access to Canada's consumer markets.  America, on the other hand, is supposed to play the role of the cash cow. 

To do otherwise is an egregious crime against the world order.

The US has many financial problems and pitfalls, yes, but this doesn't change the fact that most of the planet relies on the US as a place to sell their stuff.  In fact, America makes up over 30% of total global consumer markets.  China and all of the EU combined cannot match that kind of allure for exporters.  They can't even afford to buy their own goods and trinkets at a level that would sustain them.  Like it or not, without US consumers the global economy falters.     

The escalating rhetoric from Canada is a perfect example of a socialist nation wrongly believing they have leverage in a fight against a larger opponent.  Canadian officials assert that they have trade weapons that can harm the US, but is this really true?  Let's take a look at come of the threats made by Canadian leaders.

Canada Can Shut Off Electricity Exports To The US?

In his blustering speeches on the fight with the US, Canadian Prime Minister Mark Carney argued that Canada supplies over 85% of US electricity imports (largely to the Eastern Seaboard).  Other officials such as Ontario Premier Doug Ford and Quebec Premier Christine Fréchette have openly called for these power supplies to be cut off in order to "punish" the US for tariffs.  

Doug Ford threatens to cut off electricity to the United States.

Elbows up, motherfuckers! pic.twitter.com/Q044kXX6cR

— Mark Slapinski (@mark_slapinski) August 25, 2026

What they don't mention is that Canada's electricity makes up less than 1% of all US power.  In other words, this is empty posturing.  They are relying on the stupidity and lack of research of average social media posters to repeat such fallacies in the hopes of frightening American voters.

The tactic is similar to what the Iranians have been doing - Playing on social media hype while omitting the dire realities of their ground game. 

Canada Can Shut Off Oil Exports To The US?

The US is the world's largest oil producer and is a net exporter.  Strictly speaking, the US does not need any Canadian oil in order to function.  On the other hand, the Great White North does supply around 60% of all foreign oil going to the US.  Wouldn't the loss of this oil cause some kind of damage to the American economy?

PM Mark Carney says Canada fuels U.S. growth, supplying 99% of its natural gas imports, 85% of electricity imports, and 60% of crude oil imports.

“I don’t think they want us to stop sending any of that energy.”

Follow: @dimosnews pic.twitter.com/p9mHLImtep

— Dimos News (@dimosnews) August 23, 2026

Possibly, but Canadians calling for this measure might not understand how their own oil infrastructure works.  Around 70% of Canada's oil supply travels out of Alberta using pipelines that cross into US territory (the Enbridge Pipelines).  These pipelines go through the US east to Ontario. 

This goes for natural gas as well, which Canada also transports using pipelines that travel through the US. Shutting down energy flows to the US would mean shutting down energy flows to the largest population centers in Canada.  Not very smart.

The Loss Of Canadian Goods Would Be Detrimental To The US? 

Besides oil, what does the US actually buy from Canada?  Well, a lot of cars and car parts, machinery, engines, metals and lumber.  Most of these goods used to be produced in the US until outsourcing to foreign countries killed US manufacturing, mining and logging.  Meaning, the US took a massive jobs hit by opening up its markets to countries like Canada.  Canada wasn't necessarily doing the US a favor.

Canada's advantage over all other countries except perhaps Mexico is that they are the most convenient source for these goods; that does not mean they are not the only source.  They are replaceable.  Scaling to adapt to the loss of Canadian auto parts, for example, would be frustrating due to extensive integration, but it can be done within 1-2 years. 

In the meantime, what do Canadian leaders think is going to happen to all the manufacturers in their country who are suddenly cut off from American markets?  They're going to leave, and they will likely move their operations to the US to avoid the 50% tariffs. 

At bottom, Mark Carney's decision to walk away from the US trade deal which reduced tariffs to a reasonable level is going to prove disastrous because Canada has nothing that the US needs, and the US has something Canada needs very much (the largest consumer market in the world right next door). 

The economic advantages Canada has enjoyed simply through proximity to the US cannot be denied.  It seems foolish for Carney to scrap a deal with limited tariffs in favor of a 50% sledgehammer.  It appears as if he believes Canada is entitled to limitless US access, as if Canada is another American state. 

But let's say that the socialists get everything they think they want, including the eventual downfall of the US economy.  Let's say they find some way, some Achilles Heal, that brings the US down.  Canada and most of the world would only suffer further with the loss of 30% of global consumption.  It would not be the grand victory they imagine.  Instead of simply accepting moderate tariffs, they would rather blow themselves up.                          

Tyler Durden Tue, 08/25/2026 - 08:40

Futures Bounce As Brent Drops Under $90 On Renewed Iran Optimism

Global stocks rose as chipmakers rebounded, with falling bond yields adding support to risek sentiment after Brent crude slid below $90 a barrel, down more than 3% after a New York times reports that "evacuated foreign service officers could begin heading back to their posts as early as this week... suggesting Washington does not anticipate a renewal of full-scale conflict with Iran." Oil is also lower on positive signals from Pakistan’s army chief, and Al-Arabiya reporting that he carried an offer to lift sanctions under the MOU. As of 8:00am ET, S&P 500 futures climbed 0.4%, while those for the Nasdaq 100 advanced 0.9% and leading the charge in a reversal of yesterday’s cash performance. In premarket trading, semis lead with Memory, Mag7, Software, and Low/Unprofitable Tech all higher too. This is occurring with bond yields down 1-2bp. Nvidia was poised to break its longest losing streak since 2022. Semis are up 2% and Memory +3.5%, reversing all of yesterday's drop. NVDA is also leading Mag7 higher with 5 / 7 higher ex-AAPL, MSFT. The AI theme is boosting other sectors as Cyclicals ex-Energy lead Defensives. Monday saw the second-lowest tape volume of the year despite the update from Bessent and renewed noise around debasement trades. Gold snapped a four-day run of gains, while the dollar held steady. The yield on 10-year Treasuries declined four basis points. In a WSJ Op-ed, Stan Druckenmiller gives his view on the likelihood that Bessent - his former junior trader at Soros - is making with intervention. In commodities all 3 complexes are lower with Base Metals the bright spot; gold is outperforming broader Precious on the move lower. Today’s macro data focus is on Housing Data, regional Fed activity indicators, weekly ADP, and Consumer Confidence.

In premarket trading, Mag 7 names are mostly higher: Nvidia climbs 0.9%, with the chipmaker set to snap its seven-session losing streak as Wall Street awaits the company’s quarterly update due Wednesday. Meta Platforms +0.9%, Tesla +0.5%, Amazon +0.4%, Alphabet +0.4%, Apple -0.1%, Microsoft -0.2%.

• Alibaba ADRs (BABA) rise 0.5% after the South China Morning Post reported that the company’s founder Jack Ma bought more than $76.5 million worth of the company’s Hong Kong-listed shares, citing people familiar with the matter.
• Artificial intelligence-linked stocks are rising and on track to end days of share price declines. Micron (MU) climbs 2%, Seagate (STX) gains +2%.
• Dick’s Sporting Goods (DKS) falls 12% after lowering its full-year outlook amid weakness at its recently acquired Foot Locker unit, overshadowing sales gains during the World Cup.
• Dynatrace (DT) climbs 3% after Morgan Stanley upgraded the infrastructure software company to overweight, citing faster growth prospects.
• Kura Oncology (KURA) rises 9% after CEO Troy Wilson reported buying $1.24 million of shares in the company.
• Navitas Semiconductor (NVTS) gains 5% after the company announced a deal to acquire Claros Inc.

In other corporate news, investment bankers and would-be buyers have been eyeing potential assets that might be for sale with Paramount Skydance’s legal fight to buy Warner Bros. Discovery dragging on. In other assets, private equity managers using structured equity deals to placate investors frustrated by a lack of cash returns. Bitcoin climbed above $80,000 for the first time since mid-May, back in favor amid dollar debasement chatter.

Brent oil fell to the lowest level in a week after the New York Times reported the US is preparing to send diplomats back to embassies in the Middle East, suggesting Washington doesn’t anticipate a renewal of a full-scale conflict with Iran (expect this latest burst of geopolitical optimism to be reversed shortly). 

Technology shares remained in the spotlight, with chip stocks firming in the run-up to earnings from Nvidia, which has for years been a bellwether for the artificial-intelligence trade. More recently, it has also become involved in orchestrating funding for projects across the technology’s ecosystem.

“Nvidia needs to give investors a reason to raise forward numbers,” said Amanda Lyons at Energy Group Capital. “The fundamental debate has shifted from whether AI demand exists to whether the extraordinary infrastructure buildout can continue generating sufficient economic returns.”  

Traders are also looking out for the US Treasury’s next moves, with long-dated yields still trading near multi-decade highs. A slate of economic data and a key speech by Federal Reserve Chair Kevin Warsh at the end of the week will further shape the direction of bonds and expectations for interest rates. Warsh’s first major speech as Fed chief will be a trial of his pared-back communications style. His challenge is to address criticism that he hasn’t been forthcoming about his views on the economy without compromising his resolve not to spoon-feed traders clues about future policy moves.

Investors are awaiting key events “that could define the direction of markets heading into September,” said Laura Cooper, global investment strategist at Nuveen. “From clarity on the Fed’s reaction function and the potential need for a September hike to whether AI earnings can revive tech enthusiasm, there is plenty for investors to digest.”

Tied to the sudden burst of dollar debasement, bitcoin briefly surged past $80,000 before paring its advance. The cryptocurrency is benefiting from a return of optimism to the sector after Treasury Secretary Scott Bessent’s intervention in the bond market last week fueled demand for dollar alternatives.

Stanley Druckenmiller, the billionaire investor who mentored Bessent in his early career as a hedge fund trader, suggested his former pupil was making a mistake by wading into the bond market. “Governments defending prices against fundamentals always lose,” Druckenmiller wrote in a Wall Street Journal opinion column.

In politics,  the US is set to impose a 7.5% tariff on Chinese goods over allegations of excess manufacturing capacity before a planned summit between Xi Jinping and Donald Trump. Meanwhile, Bessent’s Iran threat hinges on the willingness of the US to escalate tensions with China, which buys around 90% of Iran’s oil. 

The consumer confidence reading is in focus later in the session, following alarming signs from bellwether Walmart last week and with retail gas prices elevated — unleaded remains above $4/gallon, while diesel is approaching recent highs. Consumers likely lost some confidence in August amid renewed concerns about the labor market and inflation, while elevated long-term yields will weigh on confidence for the foreseeable future, notes Bloomberg Economics.

Zoom Communications and Intuit kick off a busy week for software earnings tonight, with the broader sector the best-performing group in the S&P 500 Index over the past month. In contrast, Nvidia heads into numbers on Wednesday with the stock currently on the longest losing streak since Sept. 2022.

The mood music in Europe is also upbeat with the Stoxx 600 up 0.5% alongside a 3.1% pullback in Brent crude.

 

In FX, the greenback has failed to hold onto an initial gain with the Bloomberg Dollar Spot Index now slightly lower with pound the marginal G10 outperformer.

In rates, softer crude has dragged global borrowing costs lower with US yields down 1-3bp, inside last week’s ranges; 10-year near 4.66% is 3bp lower on the day with UK and German counterparts similarly richer. 

Treasuries hold modest gains, trading just off session highs as US trading gets under way, as oil benchmarks extend retreat from last week’s monthly highs.  Treasury auction cycle begins with 2-year notes, following a raft of second-tier US economic data. Key events later this week include July personal income and spending data including PCE price indexes and Federal Reserve Chairman Kevin Warsh’s speech at the Jackson Hole Symposium. $69 billion 2-year note auction at 1 p.m. New York time has WI yield near 4.23%; last month’s 2-year sale drew 4.315%, the highest result since December 2024; $70 billion 5-year and $44 billion 7-year note auctions follow over next two days. IG credit new-issue calendar is anticipated to be light through month-end; Sumitomo Mitsui Trust was Monday’s only issuer with a $2.25 billion three-part offering

In commodities, energy prices are weaker in the wake of the US ramping up economic pressure on Iran, positive signals from Pakistan’s army chief, and Al-Arabiya reporting that he carried an offer to lift sanctions under the MOU. WTI crude oil futures are down about 3% amid assessment of latest US measures against Iran. Spot gold printed a fresh multi-month peak before fading upside, now lower by 0.4%. Bitcoin is up 1.3% but back below the $80k mark. 

US economic data calendar includes ADP weekly employment change (8:15 a.m.), August Philadelphia Fed non-manufacturing activity (8:30 a.m.), June FHFA house price index and S&P Cotality home price index (9 a.m.), August Richmond Fed manufacturing index and Conference Board consumer confidence and July new home sales (10 a.m.). Fed speaker slate includes only Richmond Fed’s Tom Barkin repeating Aug. 13 comments at 8 a.m. and 4 p.m.; Barkin, the only Fed speaker with scheduled appearances ahead of Warsh’s address at the Jackson Hole Symposium Friday, also is set to make unscripted comments in a panel discussion Wednesday

Market Snapshot

Top Overnight News

• Treasury Secretary Scott Bessent’s threat to unleash an economic assault against Iran risks setting the US on a collision course with China, its main trading partner: BBG
• Iran vows to resist widened US sanctions, says Washington seeks talks: RTRS
• U.S. Squeezes Iran but Avoids Targeting Its Biggest Lifeline: China: WSJ
• Stanley Druckenmiller, the billionaire investor who mentored US Treasury Secretary Scott Bessent in his early career as a hedge fund trader, suggested his former pupil is making a mistake by wading into the bond market: WSJ
• Oil extended Monday’s drop as a US plan to ramp up economic pressure on Iran so far spared the country’s trading partners from harsher measures for now: BBG
• The debasement narrative is back, and has propelled Bitcoin to a three-month high. The crypto rally isn’t just about a weaker dollar and fiscal concerns, however, and the key level that could prove that is $83,000: BBG
• Trump's approval holds at record low as US support for Iran war falls: RTRS
• The AI-debt deluge is getting so extreme in most major global credit markets that a global borrower is turning to far-flung New Zealand to try to escape it, in its first overseas issuance there in almost a decade: BBG
• New installations emerge on islet as China accelerates South China Sea build-up: RTRS
• Global stocks rose as chipmakers rebounded, while Bitcoin briefly topped $80,000 and oil extended declines.
• US Supreme Court sides with President Trump for now regarding his mail-in ballots curbs. US Supreme Court lifted a judicial decision that blocked in 23 states and Washington DC, President Trump's order restricting mail-in ballots.
• US is preparing to rescind up to 200,000 business and tourism visas in largest mass visa revocation ever, reported AP citing officials.
• Oura and Dunkin’ Get Ready to Join IPO Bonanza: WSJ
• Lutnick’s Intervention in Canada Talks Draws Praise, Blame: BBG
• Trump administration moves to impose more than $100,000 fee for H-1B worker visas: RTRS
• Goldman Sachs revises its timeline for the next Bank of Japan interest-rate hike to September from January 2027, according to a note by economists including Tomohiro Ota and Yuriko Tanaka.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks were mixed following the subdued lead from Wall Street, where most major indices declined amid tech weakness and headwinds from Economic D-Day sanctions on Iran and the US-Canada trade war. ASX 200 traded higher amid strength in the domestic tech, healthcare and financial sectors, while participants digested a plethora of earnings and somewhat balanced RBA August Meeting Minutes. Nikkei 225 saw two-way price action and gradually clawed back initial losses to move into the green, with recent reports noting that Japan is considering exempting gains from non-core business sales from corporate tax if companies reinvest the proceeds in acquisitions. KOSPI underperformed amid recent tech headwinds and with SK Hynix shares also pressured after union members narrowly rejected the tentative wage agreement through a 50.1% vote against. Hang Seng and Shanghai Comp were subdued amid earnings releases and cautiousness as US sanctions on Iran and warnings against countries with economic ties to Iran, increase risks of stoking US-China frictions, while the US is also mulling 7.5% overcapacity tariffs on China.

Top Asian News

• Japanese PM Takaichi said Govt. plans to continue keeping the gasoline price at around JPY 170/Litre.
• Japanese Ministry of Finance requests a FY27 budget of JPY 38.6 tln, 15.1% increase compared to the initial budget for FY26, Kyodo reported; "the increase is due to rising interest rates".
• Japan PM Takaichi has reportedly requested the LDP to "actively promote" measures against rising inflation, in a recent meeting, Nikkei reported.
• Japanese Finance Minister Katayama said can't comment on budget requests for fiscal 2027, adds will focus on key policies in FY27 budget to drive economic growth and will balance fiscal sustainability and economic growth and will communicate with market. said:. Have received various opinions on scheme for JGBs for retail investors.

European bourses (STOXX 600 +0.4%) are broadly firmer this morning, digesting the positive mood music following the recent Pakistan-Iran talks in Tehran. In brief, Pakistani officials suggested that “we had a constructive exchange of views on the issues raised”, noting “big progress”. Most recently, mild risk-on action was seen after sources suggested that the Pakistani Army Chief conveyed a message from the US to Iran. The Americans reportedly offered to halt the naval blockade, in exchange for opening the Strait. Nonetheless, the gains are modest at this stage, as talks are only at preliminary stages and amidst the heightened uncertainty. European sectors hold a positive bias. Industrials takes the top spot, joined closely by Energy and then Utilities. The leader today has been buoyed by strength in Melrose (+8%) after it announced that the GKN probe has ended without criminal charges, and as it sets out a reopening timeline for the Garden Grove plant. To the downside, Autos parks itself at the foot of the pile, followed closely by Consumer Products & Services. Key Stories: NatWest (-0.2%, FT reports that the Co. plans to expand into the US), Next (+1.9%, upgraded at Citi), CD Projekt (-6%, delays release of The Witcher IV), Gerresheimer (-5.7%, CEO Rohrhoff to step down as interim CEO), Siemens Energy (+1.5%, working with Goldman Sachs to field offers for a majority stake in its steam turbines business).

Top European News

• German real wages projected at 0.7% in 2026, Handelsblatt reported citing the WSI Archive.
• EU Commission is being urged by the EPP and RE groups to withhold EUR 770mln of funding from Romania, due to concerns around rule of law, Politico reported citing a letter.
• UK PM Burnham has shelved plans to put Thames Water into a special administration regime amid concerns about the costs and legal risks involved, according to The Times.

FX

• DXY was bid through APAC trade, marking a peak of 99.11 in Europe, thereafter entirely erasing gains to a 98.94 trough following an optimistic readout of the Pakistan-Iran meeting via Saudi press sources (see commodities for details). Focus remains on the geopolitical situation and its follow through to yields, where the US 30yr currently sits at the middle of Wednesday's Treasury announcement fall, around 5.22%. Brent contracts trade USD 3/bbl off session highs, the Brent November contract looking below to 88.50/bbl. The session ahead is light with ADP’s weekly Employment Change data and a 2yr auction scheduled.
• EUR did not take too much of a lead from the aforementioned action in energy markets. TTF around EUR 67/MWh remains at an uncomfortable level for the ECB, which, alongside a strong Ifo, paints a hawkish mood in today’s session. EUR/USD is just off recent 1.17 highs, within 1.1651-1.1671. GBP action is similarly quiet with focus on the upcoming week’s risk events; domestic updates include PM Burnham failing to rule out tax increases in the Budget, remarks which have not given much of a lead to UK assets. GBP outperforms vs. USD just below 1.1650 and EUR, at 0.8550.
• SEK is weaker against the EUR and flat against the Buck with no reaction to Riksbank minutes, which showed members were optimistic about the Swedish economy, though revealed a split on the future rate path, with some members maintaining a wait-and-see stance.
• Barclays month-end FX: moderate USD selling against all majors.
• PBoC set USD/CNY mid-point at 6.7852 vs exp. 6.7219 (prev. 6.7841).
• PBoC sold CNY 15bln of 3-month yuan bills at 1.30% and CNY 15bln in 1-year yuan bills at 1.35% in Hong Kong, as previously indicated.

Fixed Income

• Fixed benchmarks saw some modest pressure in the first part of the APAC session, before lifting in the early European morning and then falling again on data, pressure that was unwound shortly after by energy action.
• The mentioned overnight pressure sent USTs to a 108-11 base, holding above Monday's 108-08+ trough. Since, the benchmark has been as high as 108-16, and is holding flat on the day a tick or two off that high. Recent upside a function of energy pressure, as sources report that the US told Pakistan to tell Iran that it would halt the siege and lift sanctions under the MOU, if Hormuz opens and proxy attacks stop. We now await an update from Iran, who are said to be consulting and are expected to respond soon.
• Ahead, USTs look to 2yr supply, in addition to a handful of data points.
• Bunds in-fitting with the above, just with a slightly larger range. The overnight base was 123.76, since taken out by two ticks just after the cash equity open and into Ifo where the stronger-than-expected series sparked some fresh downside. In more recent trade, the discussed energy pullback has allowed Bunds to lift back into the green, to a peak of 124.03. Some of that upside came alongside a 2028 auction, which drew a b/c of 1.49x (prev. 1.37x). However, it may not directly compare because the prior outing had EUR 6bln on offer vs EUR 5bln today.
• Gilts in-fitting with the above, as UK specifics are light. Firmer by a tick or two in 86.02-48 parameters. A 2033 Gilt auction was well received, with a b/c of 3.4x (prev. 3.16x).
• TenneT Germany to sell EUR-denominated hybrid 30-year noted; yield guidance seen at 4.875%.
• Australia sold AUD 1.2bln 1.00% November 2031 bonds, avg. yield 4.6310%, b/c 3.63.
• UK sells GBP 4bln 4.125% 2033 Treasury Gilt: b/c 3.4x (prev. 3.16x), average yield 4.761% (prev. 4.519%) & tail 0.2bps (prev. 0.2bps)
• Germany sells EUR 3.83bln vs exp. EUR 5bln 2.70% 2028 Schatz; b/c 1.49x (prev. 1.37x), average yield 2.85% (prev. 2.78%) & retention 23.4% (prev. 24.1%)

Commodities

• On diplomacy, Pakistan has been optimistic once again. Energy futures saw downticks on reports that Pakistan has reported "significant progress" in high-level diplomatic talks held in Tehran, aimed at de-escalating the ongoing US-Iran war, whilst further downside were seen after Al Arabiya/Al Hadath sources said Pakistani Army Chief Munir conveyed an offer to Iran, from the US, to halt the siege and lift sanctions under the MOU, in exchange for opening the Strait of Hormuz and stopping proxy attacks. Tehran will continue its consultations to submit its response soon, according to these reports.
• WTI Oct and Brent Nov are subdued and hit new incremental lows on the Al Hadath/Al Arabiya reports from Pakistan. The former resides towards the bottom end of a USD 82.25-85.84/bbl range and the latter in a USD 87.92-91.29/bbl parameter. As it stands, the complex is at fresh incremental lows after the NYT reported that US is reportedly mulling returning diplomats to Middle Eastern embassies as soon as this week, "suggesting that the Trump administration does not anticipate a return to all-out hostilities".
• Dutch TTF is choppy and flat at the time of writing, but still near elevated levels north of EUR 68/MWh after earlier finding support just under EUR 67.50/bbl and then briefly topping EUR 69/MWh. “Supply concerns continue to grow in the European natural gas market, particularly with storage levels, as the region moves closer towards the heating season”, ING posits, “At the current rate, it will be difficult for the EU to hit even the lower storage target of 75% ahead of the heating season. This raises the prospects of forced buying, increasing upside risk for gas prices.”
• Metals are lower across the board with precious metals show slightly deeper losses vs base metal counterparts, with the former weighed on by a resilient DXY despite the losses in oil, whilst the latter is underpinned by continued hopes of Chinese stimulus. Spot gold resides in a USD 4,617-4,697/oz range after topping yesterday’s USD 4,681/oz high. Spot silver fell from a USD 67.56-69.95/oz. 3M LME copper resides in a narrow USD 14,197.25- 14,278.00/t parameter.
• Japanese Government is set to launch state support for construction of oil pipelines which bypass the Strait of Hormuz, Nikkei reported. PM Takaichi reportedly will announce this at the Green Transformation meeting on the 26th August.
• Oil refinery in Russia's Rostov temporarily suspended operations following Ukrainian attack, TASS reported.
• Kazakhstan's Kondensat refinery will process Russian crude and send 30% of refined products to Russia, IFX reported.
• Japan's Trade Minister Akazawa said won't release government oil stockpile in September and October.
• South Korean Finance Minister said stronger KRW will help ease rise in crude oil-related import costs, will extend naphtha supply steps through January.
• Kazakhstan Energy Ministry said oil production plans are to be tweaked due to CPC attacks, with production loss to reach 3.5mln tonnes.
• Kazakh Energy Ministry said repairs at Karachaganak are scheduled for mid-September, with oil production losses expected to reach up to 450k tons, Interfax reported.
• Mosaic (MOS) predicts a phosphate shortage in Brazil starting in September, citing waning domestic stockpiles, CNN Brasil reported citing an executive.

Trade/tariffs

• Canada is reportedly to announce retaliatory tariffs against the US on Tuesday, according to an AP source.
• US President Trump said in tele-rally that the country desperately needs aluminium and mainly gets it from Canada, while he also comments that he wants to get beef prices down.

Central Banks

• Former BoJ Board Member Adachi said the BoJ will probably raise the benchmark interest rate next month, stating the BoJ is pretty much boxed in, markets have almost fully priced in a hike, and if the BoJ doesn't hike, the yen could weaken sharply.
• RBA's markets head Jacobs goal is a system that can flexibly supply whatever quantity the banking system demands, while keeping the cash rate close to the board's target. said:. As reserves become more demand driven active liquidity management will become more important for financial institutions.
• RBA Minutes from the August meeting stated board is ready to increase rates if upside risks materialise and several members judged it is possible upside risks to inflation would crystallise, others saw offsetting downside risks and time to assess data.
• Riksbank Minutes: Seim said still concerned that inflation might become too high. Seim: I am concerned that inflation might become too high. There are a further number of international factors that risk increasing inflationary pressures going forward, for instance, the extreme weather in parts of Europe and Russia’s war of aggression in Ukraine. Jansson: Overall, my assessment given this is that the inflation picture now is somewhat poorer than in June. But it deserves to be emphasised that the shifts are small. Currently have more of an impact on how we communicate future inflation risks than a direct quantitative effect on our monetary policy plan, in line with the text in the draft Update. Have scope to wait before adjusting our monetary policy, even if there are some risks of elevated inflation going forward. Thedeen: I am becoming increasingly convinced that the upturn in economic activity is now on firmer ground. My conclusion is that the level of vigilance with regard to rising inflation must be high. I assess that our next change in the policy rate needs to be a raise. Hjelm: It is appropriate to begin thinking about monetary policy in a scenario where the conflict becomes long-lasting and low intensive and where consideration for possible future escalation is no longer reasonable. It is appropriate that the policy rate remains slightly expansionary, which I assess the level of 1.75 per cent to be. I consider that the risk of an escalation of the war, resulting in substantial price increases, justifies a probability of rate increases over the year. Bunge: Overall, I think that it is reasonable to wait before adjusting the policy rate and to communicate today that the probability of a rate increase still stands since June.
• RBI is likely intervening to support the rupee, according to traders.

Geopolitics

• Ukraine military said it struck the Afipsky refinery (180k bpd) in Russia's Krasnodar region.
• Oil refinery in Russia's Rostov temporarily suspended operations following Ukrainian attack, TASS reported.
• Kazakhstan's Kondensat refinery will process Russian crude and send 30% of refined products to Russia, IFX reported.
• Ukrainian forces strike Afipsky oil refinery in Russia’s Krasnodar Krai overnight.
• UK PM Burnham plans a US trip next month to lobby US President Trump on Ukraine aid.

Middle East

• Pakistani Army Chief Munir conveyed an offer to Iran, from the US, to halt the siege and lift sanctions under the MOU, in exchange for opening the Strait of Hormuz and stopping proxy attacks, Al Arabiya/Al Hadath sources report. Al Hadath reported Washington offered to halt the naval blockade and lift sanctions on Iran in exchange for opening the Strait of Hormuz and stopping proxy attacks. Pakistani Army Chief told Senior Iranian official that the agents’ attacks are ongoing despite the stopping of direct attacks. Pakistani Army Chief said that the direct attacks between Iran and America have stopped. Iran will continue the fighting in the event of a new escalation. Tehran will continue its consultations to submit its response soon.
• Iranian official said the visit of Pakistani Commander of the Army to Iran was highly fruitful...the results of which will soon become apparent.
• A senior Iranian official told Al Jazeera journalist that the talks with [Iran and] Pakistani Field Marshal Munir were constructive, with useful ideas exchanged, "though no messages were passed in either direction". "The visit was aimed at reviving Pakistan’s role as a mediator between Iran and the US".
• Pakistan has reported "significant progress" in high-level diplomatic talks held in Tehran, aimed at de-escalating the ongoing US-Iran war, Iran's Press TV reported.
• Pakistan's Interior Minister who accompanied the Chief of Defence Forces on his trip to Tehran wrote that Iran's President clearly expressed his government's view and we had a constructive exchange of views on the issues raised. said. There is big progress following talks with Iran's leadership.
• Iran's Supreme National Security Council Secretary Rezaei said during meeting with Pakistan Chief of Defence Forces Munir the US must change its behaviour and take practical actions regarding implementation of the terms of the memorandum of understanding. Munir said Pakistan has also made many efforts to establish security between the borders of the two countries.
• US is reportedly mulling returning diplomats to Middle Eastern embassies as soon as this week, NYT reports; "suggesting that the Trump administration does not anticipate a return to all-out hostilities".
• Iran's President Pezeshkian said on Monday that the US must change its tone and approach towards Iran, adds US reliance on coercion and bullying will only complicate executive processes.
• UKMTO said it received a report of an incident 9NM northeast of Oman's Ash Shishah, with the master of an oil tanker reporting the vessel was struck by an unknown projectile causing damage to the engine room and disabling the vessel. Crew are reported safe and environmental impact is unknown at the time of the report.
• US F-35 fighter jet declared an emergency in Saudi airspace and is making a landing at the Mawaqaf Al-Sulti Air Base in Jordan, according to Iranian media.

US Event Calendar

• 9:00 am: United States Jun FHFA House Price Index MoM, est. 0.2%, prior 0.3%
• 10:00 am: United States Aug Richmond Fed Manufact. Index, est. 6.5, prior 5
• 10:00 am: United States Jul New Home Sales, est. 620k, prior 628k
• 10:00 am: United States Aug Conf. Board Consumer Confidence, est. 90.2, prior 90.8

Central Bank Speakers

• 8:00 am: United States Fed’s Barkin Speaks on Economy
• 4:00 pm: United States Fed’s Barkin Speaks on the Economy

DB's Jim Reid concludes the overnight wrap

Markets started the last week of August in a mixed mood, with bonds supported by a decline in oil prices as the US announcement of economic pressure against Iran didn’t deliver material new measures. However, while yesterday’s decline in Brent crude (-2.35%) helped 10yr Treasuries (-3.7bps) recover, European bond moves were more subdued as European natural gas prices reached their highest level since early 2023. Equities also saw a more cautious performance with the S&P 500 (-0.28%) falling back amid a continued sell-off in chipmakers that saw Nvidia post its longest run of daily declines since 2022 ahead of its results tomorrow.

Starting with Bessent’s announcements on Iran, the US Treasury Secretary threatened secondary sanctions against any country enabling Iran’s economy, calling the move “economic asphyxiation” of Iran’s regime. He noted that Trump is calling world leaders with “specific requests to cease their interactions with the regime”. However, there were no concrete new steps other than sanctioning 60 Iran-linked entities and individuals, with Bessent saying “we are giving everyone the opportunity to remedy bad behavior”. He did add that the US would be sanctioning a major financial institution later this week without naming the target. One of the biggest questions is whether the US could sanction a major Chinese bank for facilitating trade with Iran, with Bessent remaining vague, saying “no one is above the reach of US sanctions” when asked on this.

Iran played down Bessent’s announcement, with its Economy Minister saying “we have been expecting these plans for a long time, and the government has a two-year plan under which it is fully prepared for these developments.” In the continuing war of words, Trump had also posted on Truth Social earlier in the day that Iran was “completely collapsing”.

In the absence of material escalation and amid continuing grey flows through the Strait of Hormuz, oil markets remained mostly in a wait-and-see mode, with Brent Crude falling back by -2.35% to $92.17/bbl after its +6.63% gain last week. It is largely flat this morning. The dip in oil prices helped bring some relief to bond markets, with US Treasury yields lower across the curve. That was led by the 10yr (-3.7bps to 4.70%) and 30yr (-4.5bps to 5.22%), while the 2yr was little changed (-0.3bps to 4.23%). Treasuries have given up some of those gains overnight, with 10yr USTs trading +1.5bps higher as we go to print.

Yesterday’s bond rally was also helped by a CNBC report that the US Treasury could use the cash in the Treasury General Account to help fund the increase in the buyback operations announced last week. Using the TGA may help fund the larger buyback operations without resorting to higher issuance of short-term debt. Note that while “excess” cash represents a relatively small portion of the $953bn currently in the TGA, this should still be easily sufficient for the larger buybacks planned for the weekly operations in September and October, which were increased from a maximum of $2bn to at least $4bn. However, the amounts involved are trivial in the context of the roughly $2trn annual US federal deficit. It’s also not clear if this reported TGA use will actually take place – Bessent refrained from any new signals on debt management strategy when asked during his press conference yesterday.

The rally in Treasuries also helped longer-dated bond performance in Europe, with yields on 10yr bunds (-0.5bps), OATs (-1.0bps) and gilts (-0.4bps) edging lower. However, shorter-dated yields rose across Europe, with the 2yr bund yield up +2.6bps to a 1-month high of 2.87% with 63bps of further ECB hikes now being priced by next June (+2.9bps on the day).

European bonds weren’t helped by a continued rise in natural gas prices. Front-month TTF prices rose +3.73% to EUR 68.94/MWh, their highest since January 2023 amid concerns over low gas storage levels. At 63% full, EU gas storage is the lowest for this time of the year since the current data begins in 2009. In other commodity-driven inflation concerns, wheat prices traded within touching distance of their two-year highs reached last month, before pulling back to +0.04% on the day after President Zelenskiy said that Ukraine will seek talks with Russia on grain exports and that Ukraine’s maritime grain exports are not fully blocked by recent Russian strikes.

In equities, sentiment was apprehensive, with the S&P 500 (-0.28%) and Nasdaq (-0.76%) moving lower, though the equal-weighted version of the S&P (+0.10%) inched up to within 0.5% of its all-time high. But the main indices were weighed down by renewed concerns over AI-chipmaker stocks, with Sandisk (-6.45%) and Micron (-5.83%) among the worst performers in the S&P 500 and the Philly Semiconductor Index falling -2.70%. Nvidia fell -2.91% ahead of its earnings release tomorrow, posting a seventh consecutive decline. That’s its longest losing streak since September 2022, two months before the public release of ChatGPT by OpenAI that then triggered Nvidia’s meteoric rise to become the world’s most valuable company.

Yesterday’s tech declines have largely carried over into Asian markets this morning, with the KOSPI (-0.72%) leading on the downside, though it has recovered from being down more than -2% down early in the session. Elsewhere, the CSI 300 (-0.46%), Shanghai Composite (-0.15%), and Hang Seng (-0.25%) are also trading lower. However, the Nikkei (+0.49%) and Australia’s S&P/ASX 200 (+0.54%) are bucking the negative trend. Meanwhile, US equity futures on both the S&P 500 (+0.12%) and Nasdaq (+0.35%) are slightly higher after yesterday’s declines.

In Europe, equities were mixed yesterday. The Stoxx 600 (+0.005%) was flat, with gains for the FTSE 100 (+0.35%) and IBEX 35 (+0.69%) offsetting losses for the CAC 40 (-0.37%) and DAX (-0.11%).

In yesterday’s other news, the tariff saga between the US and Canada continued as Trump announced a 50% tariff on cars, trucks and auto parts from Canada, effective Jan 1, 2027. Current US tariffs on Canadian automobiles stand at 25%. That followed comments from US Trade Representative Greer that trade talks had broken down because Canada had wanted more, and that political reasons were a driver for Canada. Meanwhile, Canada’s Prime Minister Carney said his government was still working on options for retaliating against the new 50% US tariffs on around $20bn of Canadian products that came into force late last week. With this escalatory backdrop, the Canadian dollar was the weakest performing G10 currency on Monday, falling by -0.61% against the US dollar.

In other overnight news, the Reserve Bank of Australia's (RBA) minutes confirmed that policymakers considered a 25bps hike at their August meeting, reflecting growing concerns about inflation risks, though this was weighed against the possibility of a sharper slowdown in employment, housing activity, and overall demand. The board ultimately concluded that, after earlier hikes, there was sufficient time to wait before making further policy adjustments. Markets are currently pricing a 58% chance of another RBA rate hike by year-end (up from 54% yesterday).

Finally, Bitcoin rose by +1.97% yesterday and is trading another +1.7% higher this morning at just over $80k, its highest level since May. Gold also rose +1.07% yesterday to its highest level since May, at $4,652/oz.

To the day ahead now, we’ll get the US August Conference Board consumer confidence index, Philadelphia Fed non-manufacturing activity, Richmond Fed manufacturing index, business conditions, July new home sales, and June FHFA price index. The Fed’s Barkin will also speak and we’ll have the $69bn US 2-year note auction. European data releases include Germany’s August Ifo survey and France August consumer confidence.

Tyler Durden Tue, 08/25/2026 - 08:29

Markets Now Face Two Wars And Two Economic Wars

By Michael Every of Rabobank

Two wars and two economic wars

Friday’s Jackson Hole speech from Fed Chair Warsh would traditionally be the big event this week but that’s arguably no longer true: the action is not with central banks but elsewhere. I don’t mean the ECB’s Lagarde going to work for the WEF. Rather, markets now face two wars and two economic wars.

Dawn in the US will see what Treasury Secretary Bessent calls ‘Economic D-Day’ designed “to sever every economic lifeline that sustains the tyrannical regime until Tehran stands alone.” Until the regime collapses - and everyone must either stand with the US or against them. Iran has likewise stated that any country joining new US sanctions would be “considered an enemy.” Yes, Iran’s (powerless) president said the US MoU is still the best path out of this mess, as Pakistan's army chief is to visit Tehran again today; then again, Iran also claims Saudi Arabia, Turkey, and Pakistan invited it to join their new defence pact, which just failed to defend the Saudis from attacks by the Houthis instigated by Iran.

Indeed, as the Iranian parliament advances plans for Hormuz ‘service fees’ and the US says it’s shuttling more oil through Hormuz, the risk is Tehran opts to attack the GCC and US bases in Europe. Greece is moving a Patriot missile system to Crete. The UK is having to face that Iranian hackers just shut down one of its power plants for four days. As if that were not enough, worrying signals about Turkey-Israel clashes in Syria have prompted deescalation efforts, yet regional tensions remain very high. Towards the western edge of the MENA region, Spain has rejected Morocco's calls for talks on Ceuta and Melilla sovereignty.

Today marks Ukraine’s Independence Day, with EU officials in Kyiv to celebrate. With Russia testing its readiness for military mobilisation, France is promising help with missile interceptors for Ukraine, Germany a €12bn missile program, and the UK has handed over its Storm Shadow missile blueprints alongside plans to build them there. The Kremlin has warned there will be consequences for these actions and is allegedly already sabotaging weapons factories across Europe. Putin also says Ukraine opened a 'Pandora's box' with its strikes vs. economic targets, and Zelenskyy says Russia refused a Black Sea shipping truce, ensuring more destruction to trade.

Canadian PM Carney stated his country is now in an “economic war” with the US after USMCA negotiations collapsed. He will be matching US tariffs dollar for dollar from 8 September. The alleged list of US demands made on Canada include scared cows like dairy and parts of the auto industry, weakened domestic cultural protections, and binding defence commitments, but also tougher trade rules of origin and restrictions on Canada's sovereignty to sign trade or investment agreements with other nations.

Canada presumed this was just an FTA discussion. The US -- as was abundantly clear -- is only interested in forging a tight-knit Fortress North America bloc as part of its Grand Macro Strategy. Against that backdrop, what is Canada’s Grand Macro Strategy?

Canada is 1/10 the size of the US economy. 90% of its population sits two hours drive from the US border. It’s deeply integrated into the US economy. It runs mostly north-south, not east-west trade, with internal tariffs. As KPMG notes, “Canadian manufacturers are shifting production toward the US, and the movement is material.” It’s rich in resources. It has a separatist issue in Quebec and might soon have one in oil-rich Alberta. It has a lot of privately held guns but a weak military with a very large territory to patrol. It has long relied on a US defensive shield. It also now has a pivotal geostrategic location that’s becoming vulnerable as the Arctic transforms into a playground for the Great Powers, which matters hugely to the US for *its* national security. So:

It could do more internally, but enough to mitigate being choked by the US? It’s a trading nation and can’t just go solo.

It could side with China… unleashing a FAR stronger US reaction across the spectrum, just as The Economist notes China’s “Leninist” neomercantilist model deindustrialises others. How many cars or planes will Canada sell to it vs. raw materials?

It could, but won’t, join Russia as an Arctic power - and see a US *and* EU pushback.

It can’t join the EU as it’s *not in Europe* but could ‘do a Norway’ of sorts … then Europe would insist on the same control of its external trade, as Europe is moving closer to ‘buy local’ schemes and confronting China like the US.

It could work with the UK and Australia: but both lack a Grand Macro Strategy and are too small, too reliant on the US, and too far away. In Asia, Japan and South Korea are locked into the US camp, and ASEAN are mostly net exporters trying to balance the US and China.

In short: give in and accept the liberal world order is truly over, as is Canadian sovereignty; fight an economic war when heavily outgunned (…in the hope of a better deal or outcome from the US midterms, which is just a tactic?); or encourage the liberal world order to shrink further by choosing China, which will also imply a loss of sovereignty over time along with fears of more worrisome US actions. If that sounds like a Melian dialogue to some degree, it sadly is.

While the direct impact of the US-Canada fight on world markets is small, symbolically it matters hugely. Middle Powers, and China and Russia, will be watching to see who wins, just as they are with the US-Iran. Markets will move on that.

On which, as the financial press notes ‘Warsh seeks to soothe investors’ nerves’, yet ‘Bessent Has No Easy Fix for What’s Really Driving Yields Up’, and hears from ‘US economist Barry Eichengreen on reality of de-dollarisation and next currency reshuffle’, and as Bitcoin nears $80,000 in its biggest weekly rally in three years, something else Trump just said about rising bond yields and Bessent’s Special Military Operation Twist is worth focusing on: “The ultimate intervention is our military, and if we have to use that we will.”

Yes, folks - physical power sits behind global markets. They only exist in their current form because US power won WW2 and the Cold War, and it then used that legacy to allow markets to think they get to decide everything. Now they don’t, as Trump is making painfully clear to Canada and other Middle Powers in terms of physical markets. And he’s not the only one playing that game. That in turn flows up to financial markets.

If you want to push bond yields down… raise taxes; cut spending; cut rates; do Operation Twist; QE; or YCC. Or boost the supply side with subsidies themselves subsidized with export earnings. Or use your military to take control of upstream commodity supply chains to redirect supply where you want it, ‘encouraging’ others to strike deals with you on your terms. Yes, *such wars can be lost*, but the underlying principle should be obvious. And it’s not, “because markets.”

Ironically, those joking about what Trump said, accept ongoing BOJ JGB buying or the ECB’s APP and TPI schemes, the latter allowing unlimited bond buying to supress price discovery in peripheral Eurozone bond markets, precisely “because markets” and technobabble. Drawing an analogy, they are like those enjoying a nice chicken sandwich at the desk for lunch while preferring not to think about the existence of slaughterhouses that allow them to be served.  

Bessent and Trump are saying they are willing to do ‘Whatever It Takes’. Warsh, Lagarde, PM Carney, and all of us are going to have to adapt to that awkward fact – and the equally awkward geopolitical and market movements that come alongside it whether the US wins or loses.

Tyler Durden Tue, 08/25/2026 - 08:20

Death Of Europe's Industrial Base: 140,000 VW Jobs At Risk As Union Brands Turnaround Plan "Cloud Cuckoo Land"

If further evidence is needed to support Nomura analysts' view that Europe's 18-month election cycle, which is kicking off now, will accelerate the continent's shift toward potential right-wing political victories, look beyond years of nation-killing mass migration under progressive governments. The real-time deindustrialization of Europe, or the death of Europe, particularly in Germany, is quickly eroding the left-wing establishment's popularity and providing much-needed momentum to the right-wing Alternative for Germany party.

The latest horror story emerging from Germany, Europe's top economic engine, is a warning from Volkswagen Group labor representatives that the struggling automaker could ultimately eliminate as many as 140,000 jobs.

VW CEO Oliver Blume and VW brand chief Thomas Schäfer will unveil a turnaround plan for the automaker later today that will detail workforce reductions and the potential shutdown of some production lines.

We first previewed the incoming announcement over the weekend:

• Death Of Europe's Industrial Base: VW CEO Set To Announce 50,000 Job Cuts

Volkswagen is Germany's largest manufacturer by revenue, and the warning of massive job cuts underscores the deepening crisis inside the country's industrial core. VW's earnings have been crushed by sliding sales in China, high labor and energy costs in Germany, and a flood of Chinese EVs undercutting domestic brands across the continent.

Bloomberg reported that VW management is considering cutting another 500,000 vehicles from annual European production capacity, reducing white-collar workers, cutting costs, and eliminating unpopular models and equipment variants.

The outlet quoted Christiane Benner, head of Germany's largest industrial trade union, IG Metall, who called the CEO's plan to cut massive numbers of workers and lift margins to 9% "cloud cuckoo land."

The economic misery spreading across Germany and the rest of Europe, as left-wing governments hollow out the continent's industrial base, is igniting a massive backlash. Nomura analysts expect Europe to "lurch right" during the coming 18-month election cycle (read report).

Tyler Durden Tue, 08/25/2026 - 08:05

Bessent Drops Iran Sanctions Hammer On Dozens Of Chinese Firms, Spares Big Banks As Beijing Threatens Retaliation

The Trump administration's "Operation Economic Outcast" has expanded the sanctions campaign across China and Hong Kong, targeting dozens of individuals and businesses while intentionally holding off on sanctioning major Chinese banks that keep Tehran connected to the global financial system. Beijing, meanwhile, signaled earlier Tuesday that it would not retreat from its economic relationship with Iran, raising the risk that Trump's economic war against Tehran could evolve into a direct confrontation with China, the largest buyer of discounted Iranian crude.

Late Monday afternoon, Treasury Secretary Scott Bessent unveiled nearly 60 Iran-linked sanctions under what he called Operation Economic Outcast, a campaign designed to sever Iran's remaining trade, technology and financial lifelines.

At the center of the new financial war is Hong Kong-based Sweet Ocean Industrial Ltd., which Treasury accused of helping procure laser equipment and other sensitive goods for Iran's Malek Ashtar University of Technology, a UN-sanctioned institution linked to the country's defense-industrial base.

However, Trump's decision to spare China's large banks suggests the administration is still trying to increase pressure on Tehran without sparking another trade war or prompting Beijing to restrict exports of critical metals, a move that has already triggered panic in the tungsten and germanium markets.

Treasury also designated Chinese nationals Li Na, Tian Jianbai and Zhang Limei for allegedly coordinating procurement activities supporting Iran's nuclear research and missile-development programs. Several related technology, trading and logistics firms in Hong Kong and Shenzhen were also targeted.

"Sanctions against specific entities are meaningless, as entity-specific sanctions can't be applied quickly enough to match the speed at which substitute entities can be created," said Derek Scissors, a senior fellow at the American Enterprise Institute who tracks Chinese trade, according to Bloomberg.

Scissors said some sanctioned entities could create pop-up shell companies to evade Treasury sanctions, adding that the dozens of entities named by the US "exist in a universe of tens of thousands."

"No one is above the reach of US sanctions," Bessent warned during Monday's press conference.

.@SecScottBessent: "This is a sustained campaign to collapse every last option for Iran. Let there be no ambiguity as to the position of the United States: an economic engagement of any kind with this murderous regime will expose those responsible to the full reach of American… pic.twitter.com/tlx2gcNs1d

— Treasury Department (@USTreasury) August 24, 2026

Earlier Tuesday, Chinese Foreign Ministry spokesman Lin Jian told reporters that Beijing rejected Trump's unilateral sanctions, warning that the measures could intensify the conflict rather than usher in a peace deal.

"China's cooperation with Iran has always been conducted within the international framework and should not be interfered with or undermined," Lin said. "China is closely monitoring relevant developments and will take all necessary measures to firmly safeguard its own interests."

Financial Times reports that Beijing could retaliate if Chinese firms are included in any expansion of the economic war against Iran. 

Most importantly, Treasury stopped short of targeting large Chinese banks because doing so could have derailed next month's summit between Xi Jinping and Trump.

Tyler Durden Tue, 08/25/2026 - 07:45

Iran's Economy On The Ropes Amid Hyperinflation And Widespread Gas Shortages, As Trump Blockade Bites

Bessent is on a roll: first his attempt to send yields sharply lower by announcing an aggressive TSY buyback expansion, failed spectacularly, and then today, the US “economic D-Day” against Iran and unviled by Bessent, turned out to be "less Normandy and more Grenada", according to Bloomberg. But maybe, just like in the case of last week's "failed intervention", Bessent doesn't actually have to do much - in that case, all the Treasury secretary needs to do is spark a short squeeze (as noted earlier, Treasury CTA shorts are the highest on record), while Iran appears to be having some big problems of it own without Bessent even having to do much.

According to Bloomberg, Iran is facing mounting fuel shortages as the US squeezes its access to imports, stretching supplies of a commodity that previously sparked bouts of unrest in the country.

The state-run Hamshahri newspaper on Sunday reported long queues at petrol stations in Tehran because of fears of price hikes, with many drivers filling up tanks before they’re even half empty.

A top official in charge of domestic energy supply said the gasoline market had a daily deficit of 14-15 million liters due to record demand, damage incurred in the war and “changes in the national budget’s priorities.”

“We have to do something to bring consumption down to domestic production levels,” Esmaeil Saqab Esfahani, head of the Energy Optimization and Strategic Management Organization, said last week, according to the semi-official Iranian Students’ News Agency.

Needless to say, growing fuel shortages - and mounting popular unrest - will test Iran’s ability to keep the economy moving as the US launches what Treasury Secretary Scott Bessent described on Monday as “the single greatest financial offensive ever marshalled against an adversary.” 

People line up to fill up their cars at a gas station in Tehran on Feb. 28.

As Bloomberg notes, gasoline prices are a highly sensitive issue in oil-rich Iran, where state subsidies mean consumers benefit from some of the cheapest petrol in the world. Or should.

Past efforts to raise prices have led to deadly protests, most notably in 2019, when hundreds of Iranians were killed by security forces. Throw in rampant inflation and a worsening currency crisis now crushing millions of ordinary households in Iran, and a spike in gasoline prices could be the lit match that sparks a new explosion in public anger, similar to the deadly protests in January. 

For their part, Iranian officials have been warning the public for months that price hikes may be inevitable because Israeli and US strikes on fuel storage sites and other energy facilities have compounded a longstanding supply-demand imbalance. Trump's blockade on Iranian ports has only made the situation worse by preventing imports that Iran normally relies on to offset shortages. 

President Masoud Pezeshkian, who has become an impotent figurehead,  appealed to the public for support as far back as May, as he mooted the possibility of rationing and urged people to use public transport where possible. But the warnings don’t appear to have worked. 

Last week, Iran’s parliament speaker and lead negotiator in the war, Mohammad Bagher Ghalibaf, said the US and Israel planned to exploit any rise in gasoline prices as part of their military operations against the Islamic Republic. Officials previously blamed an unspecified “foreign country” for a 2021 cyberattack on the country’s fuel network. 

In an attempt to mitigate the shortage, the government has tried to encourage drivers of the roughly 4.5 million dual-fuel cars on the road to switch to using compressed natural gas. Iran’s biggest oil processing plant, the Persian Gulf Star Refinery, also said it was using methanol to boost gasoline production, ISNA reported on Sunday.  Esfahani, the energy official, said the government is looking at three possible ways to manage the shortage.

1. The first is to distribute a fixed 121 million liters of fuel per day to gas stations before “switching off” forecourt nozzles once it runs out.
2. The second is to continue sales beyond that level but at a higher price
3. the third is to allocate quotas to individuals rather than cars.

Currently, Iran has a tiered quota system that provides each car with a monthly allowance of discounted gasoline. The first 60 liters costs 15,000 rials ($0.008) per liter, followed by 30,000 rials each for the next 50 liters and 50,000 rials for sales beyond that.

Last week the government abruptly abandoned a pilot program in the southern city of Kerman that would have increased the overall quota but applied a much higher price of 872,000 rials per liter ($0.46) for purchases above it.

Officials blamed mismanagement of the pilot for its failure, but the higher rate had also triggered widespread alarm in Kerman and stoked fears that the government was planning similar price hikes for the rest of the country.

And speaking of surging prices, Iran’s currency plummeted to new lows on Monday as the US announced further sanctions on the Islamic republic, whose citizens are now rushing to exchange lines to save their cash. 

The rial dropped to 2.02 million to one US dollar when the currency markets opened on Monday, meaning the currency is now worth about half of what it was at the start of the year.

The continued plunge during nearly six months of war has led Iranians in Tehran to sprint for the exchange markets in hopes of getting US bills before their rial falls even further.

“There is no hope for a deal and peace,” Sadegh Mahmoudi, 73, told the Associated Press as he waited at an exchange line in downtown Tehran.

Iran’s rial has been in a free fall since last November due to years of Western sanctions and persistently high inflation, factors that have only gotten worse during the war.

Iranian hyperinflation has led to a collapse in the rial.

While Iran’s official Central Bank rate stands at 1.5 million rial to the dollar, the market rate is what the average Iranian pays.

“President Trump decimated Iran’s economy to a point where the rial has never been weaker and inflation has rarely been higher,” US Treasury Secretary Scott Bessent wrote Sunday in an opinion piece in the Financial Times. 

“The regime’s final refuge now lies in the self-deception of fearful nations that still believe accommodating aggression can secure a durable peace,” he added.

Bessent warned that the additional financial penalties to come would effectively “collapse the regime,” with Trump echoing the same threat on social media.  

“IRAN IS COMPLETELY COLLAPSING!!!” the president wrote on Truth Social. 

In a tweet later in the day, Bessent said that "Iran’s currency keeps plummeting: today, crashing through the exchange rate of 2 million rials to the U.S. dollar. Over the weekend, Iran's Central Bank Governor Abdolnaser Hemmati said that the simultaneous drop in Iran’s oil revenues, tax income, and social security contributions has affected every part of Iran's economy. 3 million, here we come!"

Iran’s currency keeps plummeting: today, crashing through the exchange rate of 2 million rials to the U.S. dollar.

Over the weekend, Iran's Central Bank Governor Abdolnaser Hemmati said that the simultaneous drop in Iran’s oil revenues, tax income, and social security… pic.twitter.com/ZjOczci1Xi

— Treasury Secretary Scott Bessent (@SecScottBessent) August 24, 2026

With the United Arab Emirates, Iran’s largest trading partner, suspending all trade with Tehran, officials within the Islamic republic have threatened retaliation over the economic blows.

“Any escalation of this situation will undoubtedly bring about consequences,” Iranian Foreign Ministry spokesperson Esmail Baghaei told reporters on Monday. “Our hands are not tied.” 

Tyler Durden Tue, 08/25/2026 - 06:55

Uranium Awakens From Five-Month Slumber As UBS Warns Market Is "Tightening Structurally"

Bloomberg's continuous front-month uranium futures contract (UXA1 Comdty) briefly surged above $100 a pound in late January, driven by tightening supplies, renewed government support for nuclear power, and rising electricity demand from the AI infrastructure boom.

Uranium futures then retreated and remained range-bound between $84 and $87 for five months. But momentum has returned in August, with prices approaching $89 a pound, the highest level since early February.

The ongoing theme is that years of underinvestment have limited mine supply growth despite rising reactor demand. New uranium projects can take a decade to develop, leaving producers unable to respond quickly to higher prices. Output is also concentrated among a handful of miners, such as Cameco. 

Goldman analysts have routinely pointed back to these charts, which show that the uranium market has entered a deficit and that the gap will only widen as new reactor demand comes online in the years ahead.

China is firmly leading the global expansion and is expected to become the world's largest nuclear power market by the end of the decade.

UBS analyst George Eadie noted earlier this month, "Continued strength in term pricing and signs of accelerating utility procurement offer further evidence that the uranium market is tightening structurally."

Regular readers know that nuclear power sits at the intersection of several of our highest-conviction themes: powering up America, reindustrializing the nation, and meeting the massive new electricity demands of the AI buildout.

Related:

• Nano Nuclear Energy Signs Commercial Framework With Tillman To Enable Nuclear Power For Data Centers

As hyperscalers accelerate data-center construction, electricity availability is emerging as a critical bottleneck. Nuclear is the only scalable, low-carbon energy source capable of delivering reliable, around-the-clock baseload power, turning the nuclear renaissance into a theme that will last for years to come. 

Tyler Durden Tue, 08/25/2026 - 05:45

Details Of Iran's First Known Successful Cyberattack Against A UK Energy Facility

Via Middle East Eye

Iranian hackers shut down a British power plant for four days in an unprecedented cyber attack, the Sunday Telegraph reported.

According to the newspaper, the incident appears to mark the first time Iran-linked hackers have successfully shut down such a British facility.

AFP: Members of the US Air Force prepare munitions at RAF Fairford in south-west England, March 10, 2026.

The incident occurred alongside an alleged series of attacks on US water infrastructure last month, which affected at least 12 states and caused concern in the White House.

The Telegraph said that British officials have refused to disclose which facility was affected, citing security concerns.

A spokesperson for the Department for Energy Security and Net Zero said that the attack impacted a "small-scale energy generator", posing no "risk to the wider energy system".

No outages were reported following the incident, according to the National Cyber Security Centre (NCSC), which deals with attacks on critical infrastructure.

The British government subsequently briefed chief executives of power companies and wrote to businesses with advice, direction and next steps.

The attack appears to mark an escalation following the UK's decision to grant the US permission to launch "defensive operations" against Iran from British bases.

In March, Prime Minister Keir Starmer’s government had granted permission to the US military to use the Royal Air Force base in Fairford and the joint facility on Diego Garcia, for limited operations against Iranian missile facilities that "directly threatened British personnel", regional allies, or sovereign assets.

The authorization was subsequently expanded, allowing the US to launch strikes against active Iranian missile infrastructure targeting commercial oil shipping channels in the Strait of Hormuz.

In June, an Iran-linked hacker-activist group, Handala, claimed responsibility for a cyber intrusion targeting water facilities in California, saying the action was carried out in retaliation for alleged US strikes on water infrastructure in southern Iran. 

The group said it had obtained data from the systems and described the breach as a warning to Washington.

In a statement, Handala said it had the capability to disrupt water supplies but "stopped short of actually cutting off water to American cities", citing a different ethical code than its adversaries.

The group also said it had published five gigabytes of data as evidence of the intrusion.

In April, the group said it obtained at least 19,000 sensitive files after targeting the personal phone of former Israeli army chief of staff, Herzi Halevi.

"All your top-secret facilities, crisis rooms, maps, and even the tiniest details of your command centers have long been like an open book to us," the group said in a statement posted on its website. 

BREAKING: Iran-linked hackers reportedly shut down a small UK power facility for four days in an unprecedented cyberattack, according to The Telegraph.

The incident is believed to be the first known successful cyberattack of its kind against a UK energy facility. It reportedly… pic.twitter.com/srUcgc5QsZ

— The Geopolitics (@Newstoday555) August 23, 2026

The files, some of which were seen by Middle East Eye, showed Halevi meeting with Arab officials.

In one undated photo taken in Qatar, Halevi could be seen attending a meeting with former US Central Command (Centcom) chief Michael Kurilla. 

Tyler Durden Tue, 08/25/2026 - 05:00

Goldman Sounds Alarm: Europe May Need €100 NatGas Shock To Refill Winter Storage

We have warned that Europe is approaching a twin energy crisis, with the Northern Hemisphere winter now just three months away.

Dutch front-month gas futures, Europe's benchmark contract, surged Monday morning to 67 euros per megawatt-hour, the highest level since early 2023.

Goldman Sachs commodities expert Samantha Dart warns that EU NatGas prices may need to more than double from her base-case forecast if LNG exports through the Strait of Hormuz remain constrained.

Dart said reduced Qatari LNG loadings have forced Europe to compete more aggressively with Asia for available cargoes.

"We have argued that, in the absence of an improvement in LNG exports through the Strait of Hormuz (SoH) (Exhibit 1), European gas prices (TTF) would need to rise to discourage Asia LNG demand, thereby freeing incremental cargoes to be sent to Europe to help manage European gas storage levels," she said.

Dart warned that the most alarming scenario would emerge if Persian Gulf energy exports recovered only gradually through 2027. Under that scenario, she estimates December 2026 TTF may need to exceed 100 euros per megawatt-hour, more than double the previous 50-euro base case, while Asian JKM prices could approach $35 per million British thermal units.

She noted, "However, because LNG prices have only been this high once, during the 2022 European energy crisis, our conviction in the scale of demand response at such price levels is low, and we would see it more as a price-discovery process."

Dart also pointed out that there "hasn't been enough yet to steady European gas storage injections, with Aug storage injections thus far widening the miss relative to our expectations."

Current NatGas storage levels for the energy-stricken continent stand at just 61.68%, well below the 15-year seasonal level of 72.5%.

The conflict in the Gulf area has severely constrained LNG flows to Europe, but it is not just the gas market that is constrained. The products market is also under pressure, as evidenced by the worsening diesel crisis.

On Monday, Treasury Secretary Scott Bessent held a press conference to announce the "single greatest financial offensive ever marshaled against an adversary."

There was good news over the weekend, as the newly opened, US military-supervised shipping corridor off Oman saw a 400% surge in commercial transits, raising further questions about whether Tehran's leverage over the Strait of Hormuz has eroded. TotalEnergies' CEO was quoted early Monday as saying crude is moving through the critical waterway "very quietly."

Tyler Durden Tue, 08/25/2026 - 04:15

Norway Takes Oilfield Climate Battle To Supreme Court

By Tsvetana Paraskova of OilPrice.com,

The Norwegian government is asking the country’s Supreme Court to overturn lower-court rulings that invalidated the development permits of three new oilfields in Norway’s North Sea.

The case was brought to court three years ago by environmental organizations Greenpeace Nordic and Nature og Ungdom (Nature & Youth). In 2023, the campaigners challenged three administrative decisions of the Norwegian Energy Ministry, which had approved the plan for the development and operation of the oil and gas fields of Breidablikk, Yggdrasil, and Tyrving in the North Sea.

Breidablikk, operated by Equinor, and Yggdrasil, developed and operated by Aker BP, are already producing oil and gas. Tyrving, another Aker BP development, is expected to start up later this year.

The campaigners argued that the environmental assessments and reviews by the Norwegian authorities granted the development and operation licenses without considering the Scope 3 emissions of the customers’ burning of the oil and gas produced at these fields. 

In November 2025, the Norwegian government lost an appeal to have the invalidated licenses overturned. However, the court of appeal allowed production at the two producing fields to continue and gave the state of Norway six months to rectify the shortcomings in the assessment of the plans for field development.   

“The state will argue that the additional assessments of foreign emissions now clearly satisfy all the requirements," the Office of the Attorney General said, as carried by Reuters, as the Supreme Court begins hearings on the case on Monday.

The Supreme Court will hear arguments for four days until August 27, with the ruling expected later this year.

The Norwegian government is fighting for the new oilfields as it strongly supports the country’s oil and gas industry, a major contributor to GDP and jobs, as well as to the world’s biggest sovereign wealth fund with $2.3 trillion in assets.

Tyler Durden Tue, 08/25/2026 - 03:30

Iran Unveils Huge New Gas Discovery Amid US Economic Pressure

Iran announced a huge new gas discovery in the southern province of Fars, with the oil ministry reporting estimates of 7.5 trillion cubic feet of gas, of which 73% is recoverable, or 5.7 trillion cu ft, OilPrice reported.

Iran has the world’s second-largest natural gas reserves, after Russia.

“This amount of gas is equivalent to one block of South Pars, which can supply gas for 15 years,” oil minister Mohsen Paknejad said, as quoted by Iranian media. “This volume of gas has the special characteristic of being sweet, which reduces both development and operating costs,” Paknejad also said.

The Iranian oil ministry also said over the weekend that repairs at the South Pars gas field continue, with 70% of operations now restored. The field was damaged by U.S. and Israeli strikes in the early days of the war. It is the world’s largest gas field, shared by Iran and Qatar, which calls it the North Field and which grew into a top-three world liquefied natural gas exporter thanks to the field’s reserves.

However, restoring 100% of operations at South Pars would take at least three years, the chief executive of the company operating the field told SHANA news agency. He added that “intensive planning and alternative execution methods are being used to bring some trains back online by the end of the year and complete the overall reconstruction within two years.”

The news of the new Iranian discovery comes as the United States threatened to slap more sanctions on Tehran. President Trump called them “draconian”, saying “Well, we have things that we could sanction. We have very draconian sanctions, and we'll see what happens.”

Separately, in an op-ed for the Financial Times, Treasury Secretary Scott Bessent threatened Iran with “an economic D-Day — the single greatest financial offensive ever marshalled against an adversary.” No details about the nature of the sanctions were revealed.

Tyler Durden Tue, 08/25/2026 - 02:45

Spain's Great Replacement: Half Of Unskilled Construction Workers Are Now Foreign Laborers

Via Remix News,

Spain's construction industry is undergoing rapid demographic changes. Foreign-born workers in unskilled construction roles now make up 52.6 percent of all workers, according to data from Randstad from the first quarter

The data shows that foreign workers now exceed Spanish nationals for these unskilled roles by nearly 11,000 workers. The contrast is stark compared to pre-pandemic figures, when domestic laborers outnumbered foreign counterparts by more than 33,500.

Overall, the construction industry has lost 22,711 Spanish workers since 2019 while gaining 238,451 foreign employees, a figure that includes individuals with dual nationality. As a result, almost 36 percent of all construction workers, both skilled and unskilled, are now of foreign origin in the country.

The shift is equally evident among bricklayers. In 2019, Spanish bricklayers outnumbered foreigners by 111,000. Seven years later, that gap has narrowed to just 18,000 workers. Foreign labor has gained more than 16 percentage points in this category and currently accounts for roughly 48 percent of bricklayers working in Spain. While Spaniards remain the majority in most skilled roles for now, the statistical gap continues to shrink rapidly. Experts also predict that foreigners will increasingly dominate skilled and managerial positions in the future.

This transformation extends into specialized technical trades. The count of Spanish plumbers fell from 70,932 in 2019 to 57,781 today, while foreign representation doubled after adding over 10,000 workers. One in four plumbers in Spain is now foreign-born. Electricians show a similar dynamic, with about 32,000 foreign workers joining the profession since 2019, driving foreign representation up from under 11 percent pre-pandemic to nearly three out of ten today.

Industry analysts expect these patterns to hold due to impending retirements and low replacement rates among younger Spaniards.

Spain, like many other nations, is attempting to automate the construction industry as much as possible. However, instead of relying on advanced robots, Spain has so far shifted toward a modular construction approach in which concrete panels, bathrooms, and complete structural modules are built indoors in automated, factory-controlled settings that use machinery and assembly lines similar to those in the automotive sector. Cranes then assemble these modular components on site, requiring significantly fewer workers and dramatically cutting project delivery times.

Countries such as South Korea, by contrast, are racing ahead in automated construction, precisely because nations like Spain continue to rely on mass immigration, which is often cheaper in the short term but more costly over the long run.

South Korea does not only use automated construction in planning, but also in deploying commercialized robotics, automated modular manufacturing, and government-mandated smart construction.

Automated facilities, such as Space Factory, use advanced robotic arms to cut materials, assemble structural panels, seal joints, and fit window frames without direct manual intervention.

Unlike standard build sites in Spain, South Korean contractors actively deploy field robotics directly to job sites.

Automated rebar-tying robots and robotic concrete sprayers and finishers are routinely used by major developers, such as Samsung C&T and Hyundai E&C, to reduce heavy physical labor on high-rise residential projects. In addition, unmanned excavators and bulldozers guided by real-time GPS and drone mapping handle heavy site preparation.

Robots are even acting as supervisors to some extent, with autonomous quadruped robots, such as Boston Dynamics' "Spot," owned by South Korea's Hyundai Motor Group, continuously patrolling construction sites, performing 3D laser scans to verify that progress matches digital blueprints.

As Remix News has previously reported, automation, robotics, and AI are all leading elements of Asian economies, which have chosen efficiency and technology over mass immigration and cheap foreign labor.

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Tyler Durden Tue, 08/25/2026 - 02:00