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Trump Cryptically Writes "Here We Go!" In Reaction To Russia-Poland Drone Incident, Oil Spikes

Trump Cryptically Writes "Here We Go!" In Reaction To Russia-Poland Drone Incident, Oil Spikes

Update(1120ET): Minutes ago, President Trump issued a somewhat cryptic statement on his Truth Social, as part of his initial reaction to the overnight alleged Russian drone breach incident in Poland.

Stating "Here we go!" is a bit ominous, given it sounds - depending on the president's intent behind the words - a bit like George W. Bush's infamous "Let's Roll" related to Iraq.

Crude markets suspect so, with oil spiking...

Russia has rejected Polish and Ukrainian accusations that it sent a drone swarm to 'attack' Poland, a longtime NATO member. But likely the US will try to manufacture leverage over Moscow with this dangerous incident, where NATO planes were scrambled, civilian airports were closed, and ground air defenses put at the ready.

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Polish Prime Minister Donald Tusk said his country would formally request the invocation of NATO's Article 4 after an overnight Russian aerial attack on Ukraine saw the alleged violation of Poland's airspace by multiple Russian drones. He called it an "act of aggression".

Tusk cited that 19 drones breached the country's airspace throughout the incident, resulting in some of them being shot down. NATO's Article 4 states: "The Parties will consult together whenever, in the opinion of any of them, the territorial integrity, political independence or security of any of the Parties is threatened."

Article 4 consultations can lead to the alliance taking action if the consensus is reached. Notes from Poland says "It has previously been invoked seven timesincluding by Poland and seven other countries when Russia launched its full-scale invasion of Ukraine in 2022."

Polish Air Force, via DW

"Triggering Article 4 launches a consultation process within NATO, which can then lead to the alliance taking action. In 2022, it resulted in NATO providing support to Ukraine and activating its own response force," the analysis continues.

A Spokesperson for the Supreme Headquarters Allied Powers Europe has described of the overnight border breach of NATO's 'eastern flank' member Poland that this was "the first time NATO aircraft had engaged potential threats in allied airspace."

He further confirmed that German Patriots in Poland were "placed on alert and that an Italian airborne early warning aircraft and an aerial refueler from NATO's Multinational Multi-Role Tanker Transport (MRTT) fleet were also launched," as cited in Newsweek.

As for Tusk, he said in his address, “We are dealing with a large-scale provocation" and that "the situation is serious, and no one doubts that we must prepare for various scenarios.”

However, this certainly isn't the first time errant drones have crossed into Poland, but in this instance they were reported to have 'threatened' a Polish city some 40 miles away from the border with Ukraine. The NY Times notes:

But the apparent scale of the incursion and the joint NATO response in the early hours of Wednesday was a startling reminder of the risk that the war in Ukraine could escalate into direct confrontation between Russia and NATO. It was not yet clear whether Russia intentionally sent its drones into Poland, which would represent a clear expansion of the conflict.

Kiev has been trying to hype this threat, and it is in its interest to do so, as it has long sought to get NATO more directly involved in the war with Russia.

President Zelensky has initially cited 8 drones observed breaching Poland's border. "More information is coming in about the intrusion of Russian attack drones into Polish territory. As of now, it’s known about 8 drones," he wrote on X.

He also claimed this was intentional: "Increasing evidence indicates that this movement, this direction of strike, was no accident. There have been previous incidents of individual Russian drones crossing the border and traveling a short distance into neighboring countries. But this time, we are recording a much larger scale and deliberate targeting," he continued.

That's when he pivoted to calling for more integrated NATO air power to protect Ukraine:

The precedent of using combat aircraft from several European countries simultaneously to shoot down Russian weapons and protect human lives is highly significant. Ukraine has long proposed to its partners the creation of a joint air-defense system to ensure the guaranteed downing of “shaheds”, other drones, and missiles through the combined strength of our combat aviation and air defenses.

US Congressional hawks have also pounced, with US Representative Joe Wilson demanding that Trump trigger immense sanctions now over the 'act of war'. 

"Russia is attacking NATO ally Poland with Iranian shahed drones less than a week after President Trump hosted President Nawrocki at the White House," Wilson wrote on X. "This is an act of war, and we are grateful to NATO allies for their swift response to war criminal Putin’s continued unprovoked aggression against free and productive nations."

Those who have long wanted to see greater US actions against Russia are clamoring for escalation. Will saner minds prevail?

Tyler Durden Wed, 09/10/2025 - 11:20

Trump Ready To Hit China, India With 100% Tariffs To Pressure Putin, But Only If Europe Joins

Trump Ready To Hit China, India With 100% Tariffs To Pressure Putin, But Only If Europe Joins

In a curious reverse twist on a global trade war theme, President Trump told European officials he would impose draconian and sweeping new tariffs on India and China to push President Vladimir Putin to the negotiating table with Ukraine, but on one condiciont - EU nations do so as well.

Trump made the ask when he called into a meeting with senior US and EU officials in Washington, Bloomberg and FT reported citing people. The US is willing to mirror tariffs imposed by Europe on either country, one of the people said.

The proposal, which will never be accepted, amounts to a very public dare for Europe and is meant to show who really is the bad guy in the public perception war, given that several nations - including Hungary - have blocked more stringent EU sanctions targeting Russia’s energy sector in the past. Such measures would require the backing of all member states. 

Other potential measures discussed by US and EU officials include further sanctions on Russia’s shadow fleet of oil tankers as well as restrictions on its banks, financial sector and major oil companies, according to the people. Trump’s suggestion, first reported by the Financial Times, comes after his deadline for Putin to hold a bilateral meeting with Ukraine’s Volodymyr Zelenskiy passed without indication that the Russian leader - who is now advancing rapidly deep inside Ukraine territory and may be knocking on Kiyv's door soon - has any interest in engaging in face-to-face peace talks. Instead, Moscow has stepped up its Ukraine bombing campaign, with a strike Tuesday killing at least two dozen pensioners as they collected payments in eastern Ukraine.

According to Bloomberg, any US action would ultimately depend on Trump, who has so far refrained from punishing Russia directly despite skating through several self-imposed deadlines and Putin’s continued reluctance to negotiate an end to the war. Trump has, however, already doubled tariffs on India to 50% over its continued purchase of Russian oil. He has so far refused to punish China for doing as much energy trade with Russia as India. 

Later Tuesday, Trump wrote a social media post that the US and India were continuing negotiations to address their trade barriers, and expressed optimism the two would reach an agreement to resolve their dispute. He also said he looked forward to “speaking with my good friend” Prime Minister Narendra Modi in the coming weeks.

Trump’s tariff proposal contrasts with a softer tone he has taken in recent months on China as part of apparent efforts to secure a summit with President Xi Jinping and a trade deal with the world’s second-largest economy. Last month, he extended a pause on higher tariffs on Chinese goods into early November, a move that stabilized trade ties.

And yet, offering a token olive branch has done nothing to alienate Russia and China, which last week swore loyalty to each other during the 80 year anniversary of World War II. Signaling Xi’s defiance against attempts at isolating Putin, Russia last week announced China had signed an agreement on the Power of Siberia 2, a vast energy pipeline that Beijing had sought to delay for years. That came after photos of Xi, Putin and Modi smiling and holding hands at a summit in Tianjin were beamed around the world.

Chinese Foreign Ministry spokesman Lin Jian said his country had always adhered to an “objective and fair stance” on the war in Ukraine, when asked at a regular press briefing in Beijing on Wednesday about Trump’s latest tariff proposal. 

“China is not the creator of this crisis, nor is it a party involved,” he said. “We firmly oppose using China to make excuses and exerting so-called economic pressure.”

Xi would retaliate against any escalation. Chinese exports have shown resilience despite a 55% levy on shipments to the US, indicating Beijing has room to withstand more pain. For Trump, returning to tit-for-tat moves risks destabilizing China’s supply of magnets that are critical to American manufacturing of everything from mobile phones to missiles.  Such a scenario could also jeopardize a meeting between Trump and China’s top leader that both nations are working to arrange, and could take place as soon as next month on the sidelines of a major summit in South Korea. 

Tyler Durden Wed, 09/10/2025 - 10:55

Miran Clears Key Senate Hurdle In Push For Fed Seat

Miran Clears Key Senate Hurdle In Push For Fed Seat

The Senate Banking Committee voted 13-11 along party lines Wednesday to advance President Donald Trump’s pick of Stephen Miran, chair of the White House Council of Economic Advisers, to a short-term position as a Federal Reserve governor - setting up a likely floor vote in the coming days and deepening a political fight over the Fed’s independence.

Stephen MiranPhotographer: Al Drago/Bloomberg

If confirmed, Miran would join the Federal Open Market Committee just days before its Sept. 16–17 meeting, where policymakers are widely expected to cut interest rates for the first time since December amid signs of slowing job growth.

A Strategic Appointment Before the Fed Vote

According to Bloomberg, citing a person familiar with Senate planning, a full confirmation vote is tentatively set for Monday, Sept. 15. Miran’s temporary term would expire early next year, but the White House has not clarified whether Trump plans to nominate him for a full 14-year term or return him to his post leading the Council of Economic Advisers.

Miran told senators during his testimony that he would take an unpaid leave of absence from his White House role to serve at the Fed, emphasizing his commitment to act independently.

“I want to assure this committee and the American people that my decisions will be guided by data, not politics,” Miran said, reiterating that his advisory work at the White House would be paused.

Democrats Question Independence, Cite "Servitude"

Democrats blasted the nomination, arguing that Miran’s dual roles would undermine the Fed’s independence. They said the arrangement effectively ties his decision-making at the central bank to Trump’s influence, given the president’s power to decide Miran’s future.

“He knows that every vote he takes will determine whether he gets to go back to his White House job,” said Sen. Elizabeth Warren (D-MA), calling the situation “servitude.”

Other Democrats warned that placing a senior Trump economic adviser at the Fed - even temporarily - risks politicizing the central bank at a critical moment as it weighs a policy pivot toward lower rates.

The nomination comes amid heightened tensions between the White House and the central bank. Trump has moved aggressively to reshape the Fed’s leadership, including firing Fed Governor Lisa Cook.

Cook challenged her dismissal in court, arguing that the president lacks authority to oust sitting governors. On Tuesday night, a federal judge temporarily blocked Trump from removing her while the case proceeds.

The legal battle underscores growing uncertainty about the Fed’s autonomy as Trump pushes for policies designed to stimulate growth ahead of next year’s election season.

What Comes Next
  • Sept. 15 – Senate expected to vote on Miran’s confirmation

  • Sept. 16–17 – FOMC meeting, where markets expect a rate cut

  • Early 2026 – Miran’s short-term appointment set to expire unless re-nominated

 

Tyler Durden Wed, 09/10/2025 - 10:40

WTI Holds Gains Despite Biggest Crude+Product Build Since 2023

WTI Holds Gains Despite Biggest Crude+Product Build Since 2023

Oil climbed for a third session as investors weighed President Donald Trump’s latest tariff threats on Russian crude buyers, the fallout from Israel’s strike in Doha and the outlook for US interest rate cuts.

Trump told European Union officials he’s willing to slap new tariffs on India and China, the top importers of Russian crude, in an effort to get Moscow to negotiate with Ukraine - but only if EU nations do so as well.

Meanwhile, Israel’s attack targeting Hamas leaders in Qatar’s capital threatens to derail US-led efforts to end the Middle East conflict, reviving geopolitical risk premiums in crude prices. Israel has claimed full responsibility, while Trump distanced himself from the strike.

Despite an expected draw, API reported a crude inventory build overnight, but traders shrugged it off...

API

  • Crude +1.25mm (-1.9mm exp)

  • Cushing

  • Gasoline +399k

  • Distillates +1.5mm

DOE

  • Crude +3.939mm (-1.9mm exp)

  • Cushing -365k

  • Gasoline +1.458mm

  • Distillates +4.715mm - biggest build since Jan 2025

In an even bigger surprise than API, the official data printed a 3.94mm barrel build in crude stocks (versus a 1.9mm expected draw). Gasoline stocks rose for the first time in 8 weeks and Distillates saw the biggest build since January...

Source: Bloomberg

The build gets more notable as the Trump admin added another 514k barrels to the SPR...

Source: Bloomberg

US crude production rose back near record highs as the trend lower in rig counts appears to have stalled for now...

Source: Bloomberg

WTI is holding gains for now despite the big builds...

Source: Bloomberg

Overall, according to Bloomberg, this is a very big build in total crude and product stockpiles, with builds across the board, leading to a 15.4 million barrel increase. It’s the largest since the middle of 2023. 

Tyler Durden Wed, 09/10/2025 - 10:39

Melania, Please Talk To Donald About Epstein

Melania, Please Talk To Donald About Epstein

Authored by Frank Miele via RealClearPolitics,

Last Wednesday, an extraordinary press conference was held in the shadow of the U.S. Capitol by victims of sexual abuser Jeffrey Epstein.

Anyone who watched these women pour out their hearts to demand justice for themselves and other victims could not help but be moved.

Unfortunately, President Donald Trump did not watch, and then – almost simultaneously – dismissed the women’s heartfelt pleas for a public reckoning of Epstein’s abuse as “a Democrat hoax.”

No doubt, Trump is a rhetorical genius who has been able to define issues to his own benefit for years, but this was a low point in his presidency.

Much as it is understandable that Trump perceives the attention being given to Epstein’s life and mysterious death in a federal prison as a distraction, that must be weighed against the human toll that Epstein took. Calling it a hoax belittles the pain and suffering of women who were victims of, at worst, rape and, at best, sexual abuse.

And though Trump judged the women before he had even had a chance to hear them speak, they had already rejected his label:

This is not a hoax. It’s not going to go away,” said Marina Lacerda, who was a witness in Epstein’s 2019 indictment that led to his imprisonment and death.

Abuse survivor Haley Robson, who introduced herself as a registered Republican, invited the president to meet her “in person so you can understand this is not a hoax. We are real human beings. This is real trauma.”

After the president made his dismissive remarks, Republican Congresswoman Marjorie Taylor Greene called Trump to ask him to meet with the women at the Oval Office, but he did not accept – as of yet.

“It’s not a hoax,” Greene explained, “because Jeffrey Epstein is a convicted pedophile. That takes away the whole hoax thing. It’s not a hoax. It’s not a lie.

Greene challenged Trump to get past the political suspicions he has expressed. “I want him to be the hero and champion of this issue. And I want him to fight for these women, because I know him to be a fighter.”

Indeed, President Trump has repeatedly shown a capacity for empathy in his capacity as a private individual and as president, most notably when he promised justice for the Angel Moms who had lost children as a result of the actions of illegal aliens.

But in this case, Trump has conflated how his political enemies may seize upon the Epstein case as a weapon with the entirely unrelated issue of justice for the victims.

Speaking out about a “Democratic hoax” before he had ever seen the victims’ statements, or heard their perfectly reasonable demands, could prove to be one of the worst mistakes in Trump’s career, political or otherwise.

It is not enough to know the names of Epstein and his procurer Ghislaine Maxwell; common decency demands that the names of all those who abetted them in abusing women be revealed. If there were powerful men in finance or politics who exploited these women, their names should be known too. And what about the officials who looked the other way?

*  *  *

Got Mangoes?

*  *  *

I don’t believe Trump has any culpability for his friendship with Epstein years ago. At the press conference, the women survivors said none of them knew of any evidence against Trump. But the president’s political opponents will surely seize upon his unwillingness to ensure justice for the Epstein victims, and plant seeds of doubt that could harm him and the nation – just exactly what Trump says he wants to avoid.

In order to avoid that fate, there is perhaps one person – and one person only – who could convince the president not to view the matter through a partisan lens.

That, of course, is first lady Melania Trump.

Melania’s willingness to lobby for generosity of spirit was recently apparent in the letter she wrote to Russian president Vladimir Putin when he and her husband met in Alaska to discuss the Ukraine war.

Although Putin has been intransigent on the possibility of a ceasefire in the war he started, Melania urged him to think about the millions of children impacted by the bloodshed and to “nurture the next generation’s hope.”

A simple yet profound concept, Mr. Putin, as I am sure you agree, is that each generation’s descendants begin their lives with a purity – an innocence which stands above geography, government, and ideology. … In protecting the innocence of these children, you will do more than serve Russia alone – you serve humanity itself. Such a bold idea transcends all human division, and you, Mr. Putin, are fit to implement this vision with a stroke of the pen today. It is time.

Just as Melania called upon Putin to protect the innocence of the children of war, so too she could – and should – call on her husband to honor the lost innocence of Epstein’s victims.

She probably doesn’t need to write a letter to Trump, but since they share a residence at 1600 Pennsylvania Avenue, it would make perfect sense for her to call him aside one night and sit him down for “the discussion.”

The short version would go something like this:

Donald, you have enemies. We both know it. But sometimes your worst enemy is yourself. We both know that too. So I’m going to give you some advice. When women are young and pretty, rich and powerful men take advantage of them. That’s not a Democrat hoax. It’s a fact of life. Please watch these women, or better yet, meet with them. Find out what they want, and then help them get it. They don’t deserve shame because of what happened to them. They deserve our thanks for coming forward. They aren’t trying to hurt you; they are trying to help themselves and other women to make sure that powerful men are held accountable. It is time.

No, the Epstein case is not the most important issue facing the country. President Trump is right about that. But it is a moral test that should be easy to pass, and the longer he waits to correct course, the more damage he does – to himself.

Frank Miele, retired editor of the Daily Inter Lake in Kalispell, Mont., is a columnist for RealClearPolitics. His book “The Media Matrix: What If Everything You Know Is Fake” is available from his Amazon author page. Visit him at HeartlandDiaryUSA.com or follow him on Facebook @HeartlandDiaryUSA and on X/Gettr @HeartlandDiary.

Views expressed in this article are opinions of the author and do not necessarily reflect the views of ZeroHedge.

Tyler Durden Wed, 09/10/2025 - 10:25

Top NIH Officials Allege Illegal Retaliation For Raising Concerns

Top NIH Officials Allege Illegal Retaliation For Raising Concerns

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

Two former top National Institutes of Health (NIH) officials say other officials illegally retaliated against them for raising concerns about how new leadership conducted themselves regarding vaccines, scientific research, and other areas.

The National Institutes of Health (NIH) in Bethesda, Md., on May 30, 2024. Madalina Vasiliu/The Epoch Times

Dr. Jeanne Marrazzo, one of the officials, was director of the National Institute of Allergy and Infectious Diseases until she was placed on leave in the spring.

Marrazzo said in a complaint to the Office of Special Counsel, released on Sept. 4, that she was reassigned in March to the Indian Health Service with no justification and shortly after left without duties or responsibilities.

Marrazzo claims she was reassigned and placed on leave after raising concerns in meetings about how Dr. Matthew Memoli, the NIH’s acting director at the time, and other new leaders were advancing priorities of the Trump administration.

During one meeting on Feb. 20, Marrazzo presented on influenza. She noted in one slide that there had been an abnormally high number of recent deaths among children from influenza in the United States.

Memoli “stated that while a vaccine was ‘fine,’ the number one way to prevent bad outcomes in a respiratory outbreak is to have a healthy population,” according to the complaint.

In another meeting shortly after, that included White House officials, Memoli “reiterated the Administration’s position that vaccines are unnecessary if populations are healthy,” the complaint says.

Dr. Kathleen Neuzil, the former director of the NIH’s Fogarty International Center, was alleged to have interjected to emphasize preventing influenza through vaccination.

In a third meeting, Memoli announced the NIH would stop funding some clinical trials, including trials at Columbia University, which the White House had accused of promoting anti-Semitism, and some foreign projects.

Marrazzo said she was concerned that cutting funds would result in trial participants losing access to necessary medical care. Memoli dismissed Marrazzo’s concerns and said that officials would end the trials in an orderly fashion.

Marrazzo said that she made disclosures of illegal activities, such as illegal cessation of trials, under the Whistleblower Protection Act and that the Office of Special Counsel should reinstate her as director of the National Institute of Allergy and Infectious Diseases.

Neuzil, in her complaint, made similar allegations and said that she was improperly forced to resign.

“Dr. Marrazzo and Dr. Neuzil came forward to educate the public about the serious public health dangers this country and indeed the world faces as a result of the politically motivated actions” of leaders at the NIH and Department of Health and Human Services, Debra Katz, a lawyer representing the officials, said in a statement.

A spokeswoman for the NIH told The Epoch Times that Memoli, now the NIH’s deputy director, “emphasizes that vaccines are not interchangeable; each must be assessed on its own merits,” and that Memoli “remains fully aligned with this administration’s vaccine priorities and consistently champions gold-standard, evidence-based science.”

On foreign funding, NIH is committed to supporting rigorous, credible science—not ideological or fringe projects,” the spokeswoman added.

“Assertions that reprioritization, reallocation, or cancellation of certain grants are ‘anti-science’ misrepresent NIH’s progress and often echo the grievances of former staff.”

Tyler Durden Wed, 09/10/2025 - 09:50

Qatar Says It Reserves Right To Retaliate Against 'Barbaric' Netanyahu 

Qatar Says It Reserves Right To Retaliate Against 'Barbaric' Netanyahu 

Qatar has threatened retaliation after Israel's strike on Doha Tuesday which killed five top Hamas officials. Prime Minister Sheikh Mohammed bin Abdulrahman al-Thani in a fresh speech condemned the attack as "state terrorism" on the Gulf country's capital and warned that payback is coming.

He said Qatar reserves the right to retaliate, saying, "We've reached a decisive moment; There should be retaliation from the whole region."

Referencing Israel's Netanyahu at one point in the address, Thani said that "barbaric actions that only reflects one thing: It reflects the barbarism of this person that is leading the region, unfortunately, to a point where we cannot address any situation and we cannot repair anything, and we cannot work within the frameworks of international laws."

The Qatari leader continued of the Israeli prime minister, "He just violates all those international laws" - he said through the translator from the Arabic.

But for all the tough talk, the reality remains that Qatar has long been host to major US military and naval bases, especially Al-Udeid Air Base - the largest US installation in the Middle East, and is the operational regional HQ for US Central Command (CENTCOM).

And so it would not take drastic action against a close US military ally such as Israel, also given Qatar's military capabilities are miniscule compared to Israel's. The small oil and gas rich GCC nation also does significant lobbying on Capitol Hill.

Reflecting this reality, Thani quickly switched to a more restrained tone in his reaction speech at one point: "Mediation and Qatari diplomacy is part of its identity, and it will continue, and nothing will deter us from persisting in this role across the various issues around us in the region, in order to achieve the stability of the region and ultimately the stability of our peoples," he said.

So we should expect that absolutely nothing will happen, at least on the military front, but a direct aerial attack on a Gulf state does put the prospect of expansion of the Abraham Accords at a greater distance.

Trump says he assured the Qataris that such an attack "will not happen again on their soil".

The White House has said it notified Qatar of the impending attack on the building where Hamas leaders were staying in Doha, but Qatari officials have pushed back against this, saying that the government only was officially notified some ten minutes after the attack already took place.

Tyler Durden Wed, 09/10/2025 - 09:30

Producer Prices Unexpectedly Dropped In August, YoY Inflation Tumbles

Producer Prices Unexpectedly Dropped In August, YoY Inflation Tumbles

Unusually, we get a look at August's Producer Prices (today) ahead of the Consumer Prices (tomorrow) with analysts expecting a 0.3% MoM increase (considerably less than the large 0.9% MoM surge in July).

However, amid all the Trump Tariff tantrums, the headline PPI print FELL 0.1% MoM (yes, deflation) and July was revised down to +0.7% MoM, smashing PPI YoY down to +2.6% (3.3% YoY exp)...

Source: Bloomberg

A big reversal from last month is Final Demand Trade Services, with prices tumbling MoM...

Source: Bloomberg

Final demand services: The index for final demand services fell 0.2 percent in August, the largest decline since moving down 0.3 percent in April. The August decrease can be traced to a 1.7-percent drop in margins for final demand trade services. (Trade indexes measure changes in margins received by wholesalers and retailers.) Conversely, the indexes for final demand services less trade, transportation, and warehousing and for final demand transportation and warehousing services increased, 0.3 percent and 0.9 percent, respectively.

Product detail: Three quarters of the August decrease in prices for final demand services can be attributed to a 3.9-percent decline in margins for machinery and vehicle wholesaling. The indexes for professional and commercial equipment wholesaling, chemicals and allied products wholesaling, furniture retailing, food and alcohol retailing, and data processing and related services also moved lower. In contrast, prices for portfolio management advanced 2.0 percent. The indexes for truck transportation of freight and for apparel wholesaling also increased.

Final demand goods: Prices for final demand goods inched up 0.1 percent in August, the fourth consecutive advance. Leading the August increase in the index for final demand goods, prices for final demand goods less foods and energy rose 0.3 percent. The index for final demand foods moved up 0.1 percent. Conversely, prices for final demand energy declined 0.4 percent.

Product detail: A major factor in the August increase in the index for final demand goods was a 2.3-percent advance in prices for tobacco products. The indexes for beef and veal; processed poultry; printed circuit assemblies, boards, modules and modems; and electric power also rose. In contrast, prices for utility natural gas decreased 1.8 percent. The indexes for fresh and dry vegetables, chicken eggs, and copper base scrap also fell.

Producer Prices ex food and energy also fell 0.1% MoM with pries rising 2.8% YoY (well below expectations)

Source: Bloomberg

Under the hood, energy prices fell as did Trade Services...

We warned that Energy PPI would fall (and has further to fall)...

Source: Bloomberg

Finally, Goods ex food and energy (perhaps the most closely tied to tariffs) rose 0.3% MoM (slower than in July)

Source: Bloomberg

There is some pressure coming down the pipeline though as Intermediate demand prices are rising...

Source: Bloomberg

Economists also pay close attention to the PPI report because some of its components are used to calculate the Fed’s preferred measure of inflation, the personal consumption expenditures price index.

Those measures were mixed in August: Portfolio management services and airfares continued to rise at a solid pace, while various measures of health care services were more tame.

Over to you Mr. Powell!

Tyler Durden Wed, 09/10/2025 - 08:40

Futures Hit New All Time High After Oracle's Ridiculous Forecast, PPI Looms

Futures Hit New All Time High After Oracle's Ridiculous Forecast, PPI Looms

US stock futures are trading at another record high, with European and Asian also pushing higher after Oracle underpinned the strong sentiment in tech with blowout guidance sending its shares up by 30% in premarket trading, while the market awaits inflation data today and tomorrow. As of 8:15am, S&P futures are 0.3% higher with Nasdaq futures rising 0.4%...

... with all eyes on ORCL as earnings missed across the board, but it was the ridiculous hockeystick guidance - with cloud infra guide going from $18bn in FY25 to $144bn in FY30 - that sent the stock +30% pre-mkt and fueled optimism that the AI infrastructure roll-out is speeding up. Chipmaker Nvidia Corp. and AI infrastructure firms also advanced (NVDA +1.9%, AVGO +2.3%). Large-cap Cyclicals poised to outperform Defensives.

Keep an eye on Poland / Russia as Poland invoked Article 4 of NATO (military defensive consult); for ref, Article 5 is the call to arms of all members, used only once by the US after Sept 11. Trump looks to implement secondary tariffs on India / Russia. The yield curve is twisting steeper with the 30Y yield +1bp and USD is flat. Cmdtys are mostly higher led by crude and precious. Today’s macro data focus is on PPI with CPI tomorrow. TSMC also said its August sales rose 34% to signal sustained, strong demand for AI tech.

With the latest leg of the stock rally driven by hopes that the Fed will rapidly lower rates, investors believe that sticky wholesale and consumer inflation will remain sufficiently contained and give officials room to shore up the jobs market. 

The likelihood of lower financing costs is supporting rate-sensitive sectors such as tech, allowing markets to remain resilient against recurring risks ranging from geopolitical tensions to trade wars. Over the past day alone, the S&P 500 advanced despite escalating frictions in the Middle East and Eastern Europe alongside fresh US tariff threats targeting India and China.

“The prospect of far easier financial conditions remains supportive,” said Geoff Yu, FX and macro strategist for EMEA at BNY Mellon. “Barring any really large upside shocks in today and tomorrow’s PPI/CPI figures, it’s really a case of ‘as you were.’”

August’s producer price figures are due at 8:30 a.m. Eastern time, with the consumer inflation report following 24 hours later. Those reports, along with retail figures due Sept. 16, will be the last major data points before Fed Chair Jerome Powell announces next week’s rate decision.

Oracle is poised to add roughly $200 billion in market value if its early surge carries through Wednesday’s session. The company’s outlook underscores how AI developers must continue ramping up spending, with its customer OpenAI alone projecting that trillions of dollars will eventually be needed to build and operate infrastructure.

“I don’t know if their guidance is actually realistic but the market is buying it and buying it fully,” said David Kruk, head of trading at La Financiere de l’Echiquier. “Maybe the outlook has been overbought, it’s hard to tell.”

The renewed excitement over AI and strong corporate earnings are prompting Wall Street strategists to boost their forecasts for the S&P 500. Deutsche Bank’s Binky Chadha lifted his year-end target for the US benchmark to 7,000, signaling potential gains of more than 7% from current levels. Analysts at Barclays also raised their estimate, while Wells Fargo Securities forecasts an 11% increase by the close of next year.

Poland shot down drones that crossed into its territory during a Russian air strike on Ukraine. France has appointed Sebastien Lecornu as prime minister, the fifth in two years and starting on a day of mass protests in the country. French yields are unchanged, bund yields are edging lower and Treasuries are mixed.

In premarket trading, Mag 7 stocks are mixed, with Nvidia outperforming after Oracle’s report (Nvidia +2%, Tesla +0.4%, Alphabet +0.1%, Microsoft +0.7%, Meta -0.1%, Apple -0.4%, Amazon -0.5%).

  • Oracle (ORCL) surges 32% after the software company gave a robust forecast for its cloud-infrastructure business, a sign of strong AI-related demand. Stocks tied to AI computing infrastructure are rallying after Oracle forecast faster-than-expected revenue growth in its cloud infrastructure unit. CoreWeave (CRWV) +7%, Arista Networks (ANET) +3%, AMD (AMD) +3%
  • Asset Entities (ASST) soars 121% after holders approved a merger with Vivek Ramaswamy’s Strive Enterprises, marking the next step in creating a public Bitcoin treasury company.
  • Bill Holdings (BILL) is up 6% after the Financial Times reports Elliott Management has built a large stake in the payments automation company.
  • Fifth Third Bancorp (FITB) fall 3% after the bank said it discovered allegedly fraudulent activity at one of its commercial borrowers. The lender will present at an industry conference later on Wednesday.
  • GameStop (GME) jumps 10% after the video-game retailer reported Hardware and Accessories net sales for the second quarter that beat the average analyst estimate.
  • Nio ADRs (NIO) are down 8% after the Chinese EV maker announced an equity offering of as much as 181.8 million class A shares.
  • Synopsys (SNPS) shares are down 22% after the software company reported third-quarter results that featured a weak read on Design IP revenue. It also gave an earnings outlook that was weaker than expected.
  • Travere Therapeutics (TVTX) soars 15% after the FDA informed the company that an advisory committee is no longer needed for its supplemental drug application for the treatment of a rare kidney disorder.

In Europe, the Stoxx 600 rises 0.2% with retail and technology shares leading gains, while travel and chemicals stocks are the biggest laggards. Sentiment was boosted by jump for Spanish retailer Inditex which means Spain’s IBEX benchmark is outperforming. Novo Nordisk is rising after announcing 9,000 job cuts, though also cutting guidance. Here are the biggest movers Wednesday:

  • Inditex shares gained 6.9%, the most since April, after the Spanish retailer said sales at the start of the third quarter were up 9%. Jefferies analysts note that the firm benefits from strong customer traction
  • Anglo American rises as much as 3.7% in London, its highest intraday level since Jan. 20, after Berenberg upgraded to hold from sell after the miner moved to acquire Canada’s Teck Resources
  • Novo Nordisk shares gain as much as 3.2%, reversing an earlier 3% drop, after the Danish drugmaker said it will cut 9,000 jobs globally as it tries to regain ground in the competitive market for obesity treatments
  • EssilorLuxottica gains as much as 4.5% as Barclays starts coverage of the eye-wear maker with an overweight rating, saying the company offers an “exciting” growth profile
  • Haleon shares rise as much as 3.2%, the most in more than four months, after Goldman Sachs upgraded the stock to buy from neutral, citing an attractive valuation
  • AB Foods shares drop as much as 12%, the most intraday since March 2020, after the British conglomerate gave a trading update that showed weakness in both its sugar unit and the Primark budget clothing chain
  • Vistry shares fall as much as 8.9%, the most since April, as the house-builder delivers first-half results that Goodbody describes as “disappointing”
  • Zurich Airport drops as much as 2.3%, the most in almost three months, as Oddo BHF starts coverage with an underperform recommendation, citing both execution and regulatory risks

Earlier in the session, Asian stocks rose, on course for a fifth-straight day of gains, with the technology-dominated markets of South Korea and Taiwan leading the charge to close at record highs. The MSCI Asia Pacific Index jumped 1.1% to the highest level since February 2021, with TSMC, Softbank, Tencent and SK Hynix among the biggest boosts. An upbeat cloud-business outlook from Oracle Corp. provided the latest boost for tech sentiment. South Korea’s Kospi closed at a record high, buoyed further by optimism that a proposal to lower the threshold for capital-gains tax will be scrapped. Taiwan’s benchmark also closed at a new all-time high. Elsewhere, key equity gauges advanced more than 1% in Hong Kong and Singapore. Mainland China shares edged up but underperformed their regional peers, as sentiment softened after last week’s military parade and following the strong rally in August. 

In FX, the Bloomberg Dollar Spot Index little changed, Norway’s krone is stronger, with euro and Canadian dollar weaker.

In rates, treasuries are mixed in early US trading with front-end yields slightly richer on the day and long-end underperforming, steepening the curve around the 10-year, which is little changed. Focal points of US session include August PPI data in the morning and 10-year note reopening in early afternoon.  Front-end yields are 1bp-2bp richer on the day, long-end cheaper by similar amounts and the 10-year near 4.09%, widening 2s10s and 5s30s spreads steeper by 1bp-2bp.French bonds underperform slightly as Lecornu’s first day as prime minister was marked by mass protests against the government’s budget proposals; bunds trade broadly in line with Treasuries. In the US, Treasury auction cycle continues with $39 billion 10-year reopening at 1pm New York time and concludes Thursday with $22 billion 30-year sale. Demand was strong for Tuesday’s 3-year note auction, which stopped through by 0.7bp and produced a record low primary-dealer allotment

In commodities, brent futures are up 0.9% to $67/barrel while gold is up by about $19/oz to around $3,646/oz.

Looking at today's calendar, US economic data slate includes August PPI (8:30am) and July wholesale trade sales (10am)

Market Snapshot

  • S&P 500 mini +0.2%
  • Nasdaq 100 mini little changed
  • Russell 2000 mini -0.3%
  • Stoxx Europe 600 +0.1%
  • DAX little changed
  • CAC 40 +0.1%
  • 10-year Treasury yield little changed at 4.08%
  • VIX +0.2 points at 15.19
  • Bloomberg Dollar Index little changed at 1200.72
  • euro little changed at $1.1709
  • WTI crude +0.8% at $63.16/barrel

Top Overnight News

  • US judge temporarily blocked President Trump from removing Federal Reserve Governor Cook.
  • NATO fighter jets have shot down Russian drones over Polish airspace for the first time, after what Warsaw described as “unprecedented violation” of its territory that led it to trigger emergency consultations in the alliance. FT
  • US employer health insurance costs are projected to rise about 9.2-9.5% in 2026, the steepest increase in at least 15 years: WSJ
  • Trump has asked the EU to impose tariffs of up to 100% on India and China as part of a joint effort to increase pressure on Russia to end its war in Ukraine. A second US official said Washington was prepared to “mirror” any tariffs on China and India imposed by the EU, potentially leaded to further increase in US levies on imports from both countries. FT
  • Trump is will crack down on pharmaceutical adverts on TV and social media, while he signed a memo requiring pharma ads to disclose all risks.
  • White House could impose severe restrictions on drugs from China, delivering a blow to the US pharma industry (which has been racing to buy the rights to drugs created in China) while bolstering the small-cap US biotech industry. RTRS
  • US has warned of hidden radios that could be embedded in solar-powered highway infrastructure: RTRS 
  • Trump and Indian Prime Minister Narendra Modi voiced optimism about reaching a trade deal on Tuesday, softening rhetoric after months of friction over tariffs and Russian oil purchases. CNBC
  • US Commerce Secretary Lutnick floats taking a share of university patent money; US should get half the benefit from patients, via Axios.
  • China’s consumer prices fell more than expected in August while deflation in wholesale prices persisted, as calls mounted for Beijing to ramp up measures to bolster sluggish domestic demand and cushion weakening exports growth. China’s PPI was inline w/the Street in Aug (-2.9%, a modest improvement vs. -3.6% in Jul) while the CPI undershot the consensus (-0.4% vs. the Street -0.2% and vs. 0.00% in Jul). CNBC
  • Oracle shares jumped 30% premarket after providing a blowout outlook for its cloud business. The company is on track to add about $190 billion in market value today. BBG
  • U.S. holiday sales are projected to grow at their slowest pace since the pandemic, Deloitte said in a forecast released on Wednesday, as macroeconomic uncertainties weigh on consumer spending. RTRS
  • The Supreme Court plans to move quickly on the IEEPA tariff case (oral arguments will be during the first week in November). WaPo
  • A judge on Tuesday night blocked President Donald Trump from firing Federal Reserve Governor Lisa Cook as a lawsuit challenging her removal continues. CNBC

Trade/Tariffs

  • US President Trump reportedly asked the EU to hit China and India with 100% tariffs to pressure Russian President Putin to end the war, while a US official said that Washington was prepared to mirror any tariffs on China and India imposed by the EU, according to FT.
  • US President Trump posted that India and the US are continuing negotiations to address trade barriers and he looks forward to speaking with his very good friend, Indian PM Modi, in the upcoming weeks, while Trump added that he feels certain that there will be no difficulty in coming to a successful conclusion for both nations.
  • Indian PM Modi said he is confident India and US trade negotiations will pave the way for unlocking the limitless potential of the India-US partnership, while he added that their teams are working to conclude discussions at the earliest and he looks forward to speaking with US President Trump. It was separately reported that India and US officials are likely to have an exchange of trade delegations soon and an in-person meeting later in September, according to CNBC-TV18.
  • US Supreme Court agreed to hear the Trump administration's appeal of the judicial ruling that invalidated most of President Trump's tariffs and it fast-tracked the appeal in the tariffs case.
  • US Treasury Secretary Bessent is confident that the Supreme Court will back Trump tariffs, while he added there is a fallback tariff plan, though it is more cumbersome.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks followed suit to the mostly positive handover from Wall St, where the major indices shrugged off large downward job revisions and geopolitical escalation, to approach record levels. ASX 200 eked mild gains as outperformance in financials, tech and telecoms atoned for the losses in the mining and materials sectors. Nikkei 225 edged higher despite the recent hawkish source reports that the BoJ sees some chance of hiking this year, despite the political situation, with some officials even said to view that a hike could be appropriate as early as October. Hang Seng and Shanghai Comp gained with the Hong Kong benchmark led higher by strength in tech, while the mainland lagged after deflationary CPI data and with US President Trump said to have asked the EU to hit China and India with 100% tariffs to pressure Russian President Putin.

Top Asian News

  • Japan's economic revitalisation minister Akazawa said wage gains should be prioritised over tax cuts.
  • South Korea may scrap the plan for a capital gains tax rule revision, while it was separately reported that South Korea will establish 15 task forces made up of members from both the public and private sectors to lead individual projects aimed at creating new growth engines.
  • China to make full use of proactive fiscal policy, via Xinhua.

European bourses opened mostly firmer across the board, but sentiment has slipped on comments from the Polish PM who asked to evoke Article 4. European sectors hold a strong positive bias, and with those industries in the red only marginally so. Retail is by far and away the clear outperformer today, boosted by post-earning strength in Zara-owner Inditex (+7.5%); the Co. reported fairly in line metrics but saw a strong start to Autumn sales, which has boosted sentiment.

Top European News

  • UK PM Starmer’s "Budget board" is set to meet weekly and has been tasked with coordinating pro-growth policies in the run-up to the November 26 Budget and with keeping business and City leaders engaged, according to officials cited by the FT.
  • UK Chancellor Reeves has told her cabinet colleagues that government departments will have their access to the Treasury's emergency funds limited ahead of the budget, according to BBC sources. Note: "The GBP 9bln Treasury Reserve, designed to be used for "genuinely unforeseen, unaffordable and unavoidable pressures" has recently been used to fund higher public sector pay and compensation payouts", BBC writes.
  • European Commission President von der Leyen announces a EUR 1.8bln package to boost European battery production. Will propose a new long-term trade instrument to replace the expiring steel safeguards. EU plans short-term rental law to boost housing affordability. Intend to implement a short-term rental law to bolster housing affordability.

FX

  • DXY paused overnight after strengthening on Tuesday in a rebound from the two-day post-NFP selling, despite the worse-than-feared BLS revisions. While the announcement that a US judge temporarily blocked US President Trump from removing Fed Governor Cook spurred little reaction as participants now await incoming inflation data including PPI data later, followed by CPI tomorrow. DXY resides in a 97.693-97.932 range at the time of writing.
  • EUR lacked firm demand and eventually dipped beneath the 1.1700 handle after it recently gave up ground to the rebound in the dollar. The single currency was also not helped by the geopolitical backdrop with Poland responding to the violation of its airspace by Russian drones and with US President Trump reportedly calling for the EU to impose 100% tariffs on China and India to pressure Russian President Putin. On this, Polish PM Tusk said Poland asked to evoke Article 4 of NATO treaty; there is no reason to claim that Poland is in a state of war. EUR/USD trades in a 1.1683-1.1719 range.
  • JPY took a breather after its recent oscillations through the 147.00 level with headwinds for the pair stemming from hawkish BoJ sources yesterday. During the European morning, the pair has been uneventful and moving in tandem with the buck, whilst focus has been firmly on geopolitics. USD/JPY trades on either side of its 50 DMA (147.52) in a 147.27-147.59 range.
  • GBP continues to struggle for direction in European hours, after similar was seen during APAC hours following yesterday's price swings, whereby early upward momentum stalled just shy of the 1.3600 territory before reversing course. At home, UK PM Starmer’s "Budget board" is set to meet weekly and has been tasked with coordinating pro-growth policies in the run-up to the November 26 Budget and with keeping business and City leaders engaged, according to officials cited by the FT. GBP/USD resides in a 1.3512-1.3543 range.
  • Antipodeans are holding an upward bias and largely moving in tandem with the buck after risk waned off best levels, with gains capped after softer-than-expected and deflationary Chinese CPI data.
  • PBoC set USD/CNY mid-point at 7.1062 vs exp. 7.1359 (Prev. 7.1008)

Fixed Income

  • USTs are softer, but only marginally. In a very thin sub five tick range which itself is almost entirely in Tuesday’s 113-07 to 113-20 band. The session ahead is theoretically headlined by PPI and then followed by supply; though, geopolitical events may take precedence. Supply is a 5yr tap, follows Tuesday’s 3yr auction which was well received overall though direct demand was a little soft. That aside, a US judge has ruled that Fed’s Cook cannot be fired for now, this means she will be partaking in the September FOMC policy announcement.
  • A contained start for OATs. Largely unreactive to President Macron appointing a new PM, Sebastien Lecornu. His appointment has drawn huge criticism from the Right while those on the left, and particularly the Socialist Party (PS), haven’t been quite as animated, but still see the appointment as Macron going down a “path in which no Socialist will participate”.
  • Bunds are firmer, propped up by some risk premia amid the overnight drone incident in Poland. In brief, several Russian drones entered Polish airspace and were intercepted by Polish defence systems. An incident that has since concluded, but Poland has referred the matter to NATO. We are now waiting to see what the response by NATO formally is, but the initial take appeared to be that as the incursion is not being treated as an attack. Bunds hit a 129.44 peak amidst the NATO commentary, before pulling back. Thereafter, German paper slipped into the 2040/2041 auction, which was ultimately mixed - pressure continued following the outing.
  • Gilts are marginally firmer in quiet trade with UK specific catalysts light and focus on the above events. Gilts firmer by 20 ticks at most, lifted alongside the discussed Bund move, but have since reverted back to gains of just a handful of ticks in 91.36 to 91.58 parameters. Note, no real move on the morning’s DMO sale.
  • UK sells GBP 4bln 4.00% 2031 Gilt: b/c 3.27x (prev. 3.1x), average yield 4.208% (prev. 4.517%), tail 0.2bps (prev. 0.5bps).
  • Germany sells EUR 1.17bln vs exp. EUR 1.5bln 2.60% 2041 & EUR 602mln vs exp. EUR 1bln 4.75% 2040 Bunds.

Commodities

  • Crude traded higher following recent geopolitical developments, including Israel striking Hamas officials in Qatar, while US President Trump reportedly asked the EU to hit China and India with 100% tariffs to pressure Russian President Putin to end the war in Ukraine. The focus of the day has been on Poland announcing it conducted a military operation to neutralise targets after its airspace was repeatedly violated by Russian drones attacking Ukraine. On this, Polish PM Tusk said Poland asked to evoke Article 4 of the NATO treaty; there is no reason to claim that Poland is in a state of war. Article 4 talks are meant for consultations when “a member country feels threatened.” WTI currently resides in a 62.72-63.44/bbl range while Brent sits in a USD 66.66-67.20/bbl range.
  • Precious metals recovered overnight after retreating yesterday alongside a firmer buck despite dovish BLS revisions. Spot gold currently resides in a USD 3,620.14-3,655.06/oz range after printing fresh record highs on Tuesday at USD 3,674.69/oz.
  • Mixed/flat trade across base metals with the dollar also uneventful whilst broader risk remains cautious amid geopolitics and ahead of US PPI. 3M LME copper resides in a USD 9,914.50-9,962.35/t range at the time of writing.
  • US Private Energy Inventory Data (bbls): Crude +1.3mln (exp. -1.0mln), Distillates +1.5mln (exp. +0.0mln), Gasoline +0.3mln (exp. -0.2mln).

Geopolitics: Middle East

  • Israel's ambassador to Washington told Fox News if they can't eliminate Hamas leaders now, they will succeed next time.
  • US President Trump said the attack on Hamas officials in Doha was a decision made by Israeli PM Netanyahu and not a decision made by himself, while he added that unilaterally bombing inside Qatar, which is a close ally of the US, does not advance Israel or America’s goals and he views Qatar as a strong ally and friend to the US.
  • Algeria asked the UN Security Council to meet after Israeli strikes on Qatar.

Geopolitics: Poland

  • Ukraine's military said Kyiv was under a drone attack and air defence units are trying to repel strikes, while Ukraine's Air Force also warned that Russian drones entered Poland's airspace and that the city of Zamosk was under threat.
  • Poland's Defence Minister said aircraft have deployed weapons against hostile objects and territorial defence forces have been activated for ground searches of downed drones, while it was later reported that Polish PM Tusk informed NATO Secretary General Rutte about actions they've taken regarding objects that violated their airspace.
  • Poland's Army said Polish airspace was repeatedly violated by drones during today's attack by Russia on Ukraine and an operation was conducted to identify and neutralise the targets, while it noted the most vulnerable areas are the Podlaskie, Mazowieckie, and Lublin voivodeships. Polish Army said as a result of Russia’s attack on Ukrainian territory, there was an unprecedented violation of Polish airspace by drone-type objects and that this was an act of aggression that posed a real threat to the safety of citizens.
  • Warsaw's main airport and the Rzeszow airport were closed due to unplanned military activity related to ensuring state security.
  • Polish PM Tusk says Poland is ready to react to attacks and provocations, says there is no reason to panic; no reason for restrictions that would make citizens' lives difficult; situation seems to be under control now
  • NATO is not treating the drone incursion into Polish territory as an attack; indications that it was an intentional incursion, at least six to ten drones entered Polish airspace, according to NATO sources cited by Reuters.
  • NATO's North Atlantic Council meets today to review response to drones entering Polish airspace, according to the NATO spokesperson.
  • European Commission President von der Leyen says sanctions discussions focus on accelerating phase-out of Russian fossil fuels, and considers extending oil sanctions to include shadow fleet and third-country entities.
  • Belarus Defence Ministry says its air defence forces tracked drones that had lost their tracks; warned Poland and Lithuania of the approaches of drones.
  • Polish President Nawrocki says Poland discussed the possibility of NATO Article 4.
  • Polish PM Tusk says Poland asked to evoke Article 4 of NATO treaty; there is no reason to claim that Poland is in a state of war.

US Event Calendar

  • 7:00 am: Sep 5 MBA Mortgage Applications +9.2%, prior -1.2%
  • 8:30 am: Aug PPI Final Demand MoM, est. 0.3%, prior 0.9%
  • 8:30 am: Aug PPI Ex Food and Energy MoM, est. 0.3%, prior 0.9%
  • 8:30 am: Aug PPI Final Demand YoY, est. 3.3%, prior 3.3%
  • 8:30 am: Aug PPI Ex Food and Energy YoY, est. 3.5%, prior 3.7%
  • 10:00 am: Jul F Wholesale Inventories MoM, est. 0.2%, prior 0.2%

DB's Jim Reid concludes the overnight wrap

Markets faced a few more challenges yesterday, as investors grappled with heavy downward revisions to US payrolls, alongside a flareup of Middle East tensions after Israel carried out a strike in Qatar against Hamas’ leadership. That meant risk assets initially took a hit, whilst oil prices spiked higher as fears grew about some sort of escalation in the Middle East. However, the peak negative reaction was around London going home time with the S&P 500 (+0.27%) recovering to post a new record high. Still, bond yields closed near their intra-day highs as investors toned down Fed rate cut expectations ahead of the US PPI and CPI data today and tomorrow. 

In terms of those different stories, the Middle East dominated market attention as Israel confirmed they’d made a strike in Qatar. That’s a significant development, because Qatar is a US ally and hasn’t been involved in the conflict, acting as a mediator in the negotiations between Israel and Hamas. Qatar called the strikes a “blatant violation” of international law, with Hamas claiming that its leadership had survived the strike. US President Trump posted that the strike was “a decision made by Prime Minister Netanyahu”, adding that it “does not advance Israel or America’s goals” and calling it an “unfortunate incident”. 

The news of the strike led to an oil price spike as investors were reminded of what happened in June, back when Israel and Iran came into direct conflict and there were fears of a broader escalation across the Middle East. But this mostly reversed later on, with Brent crude ending the session up +0.56% at $66.39/bbl, having been as high as $67.38/bbl. The news also added initial upward pressure on gold, but this was -0.26% lower by the close as rates moved higher. Still, gold is up +38.2% so far this year. Oil is up a further +0.9% overnight after Trump last night said he'd back more tariffs on India and China to pressurise Russia, but only if the EU did the same. 

The other big news yesterday came from the Bureau of Labor Statistics in the US, who announced some sizeable negative revisions to payrolls. The headline was that total payrolls were revised down by -911k in March 2025, meaning that the labour market was in a weaker state than we previously thought. To be fair, these numbers don’t cover the most recent jobs reports and only go up to March. But if you smooth that adjustment over the year, then it means that the payroll numbers over April 2024 to March 2025 were around 75k lower each month than we thought. So, depending on what the final numbers show in Q1 2026, it’s quite possible that we had a couple of negative payrolls prints in 2024 already with yesterday's revision implying -5k in August and -29k in October. So as it stands this cycle didn't ultimately reach the second longest payroll expansion in history we were previously led to believe. In fact, it's now in 5th place behind the runs that ended in 1979, 1990, 2007 and 2020.

Despite the negative revisions, markets were fairly unreactive to the release, given that the direction of travel was already expected to be negative. Moreover, the weaker numbers didn't ramp up expectations of a 50bp cut from the Fed either as 27bps of cuts are now priced for next week, -1.5bps on the day. So, things were fairly steady, and there’s even a positive interpretation which says that the downgrades to 2024 and early 2025 make the recent slowdown in payrolls a lot less obvious if you consider that the baseline should be around 75k lower each month. In a Fox Business interview yesterday, Treasury Secretary Bessent did say that the Fed should recalibrate policy given the revised data, having also posted earlier that Trump is “right to say the Fed is choking off growth with high rates”.

However, Treasuries struggled to sustain the sharp rally of the previous four sessions, focusing more on the geopolitical shock and the inflationary impact of higher oil prices ahead of today’s PPI data and tomorrow’s CPI print. So, yields saw a decent move higher across the curve, with the 2yr yield (+7.2bps) rising to 3.56%, whilst the 10yr yield (+4.7bps) rose to 4.09%. Indeed, investors dialled back the likelihood of rapid rate cuts over the months ahead, with the amount of cuts priced by the June 2026 meeting falling -9.8bps on the day to 117bps.

This backdrop created some cross-winds for equities but the S&P 500 (+0.27%) still reached a new all-time high as the Mag-7 (+0.83%) powered ahead to a new record of their own. Those tech gains came even as Apple (-1.48%) sank after its annual product launch. I've already ordered the new headphones, with the new iPhone and possibly the watch to follow! The breadth of the equity performance was also on the softer side, with 60% of the S&P 500 lower on the day and the small-cap Russell 2000 down -0.55%. Meanwhile in Europe, it was a pretty flat session, with the STOXX 600 up just +0.06%. S&P 500 (+0.23%) and NASDAQ 100 (+0.19%) futures are rising after Oracle delivered a strong cloud infrastructure outlook in its results last night.

Over in France, attention has continued to focus on the political situation, with President Macron wasting little time yesterday in naming Sebastien Lecornu as France’s new prime minister, just hours after Francois Bayrou officially resigned from the post. Lecornu is a long-time ally of Marcon, most recently serving as Defence Minister in the outgoing government. He will now have the task of trying to steer a budget through the National Assembly, which is still completely fractured between the political groups. There were no signs last night that this task will become easier, with the far-right and far-left maintaining calls for snap elections while the centre-left Socialists said that Macron “persists in a path in which no socialist will participate”.

Notably yesterday we even saw France’s 10yr yield briefly poke above Italy’s 10yr yield in trading, although it eventually settled just beneath. That was partly a technicality to be honest because France’s 10yr yield benchmark rolled from the May 2035 bond to the November 2035 bond, so that mechanically pushed the yield higher. But even so, it was still notable given that France has been considered the safer sovereign of the two for much of recent history, and you have to go back to 1999 for the last time that France’s 10yr yield closed above Italy’s. Nevertheless, aside from the bond roll, French assets actually outperformed yesterday, with the 10yr OAT yield down -0.9bps on the session, in contrast to a rise in yields for 10yr bunds (+1.7bps), BTPs (+0.6bps) and gilts (+1.7bps).

Staying on Europe, today we’ll hear from Commission President Ursula von der Leyen, who’s delivering her State of the Union address to the European Parliament. This is usually a high-level strategic agenda for the next 12 months, but it could also contain some new policy measures, with the 2023 speech announcing the anti-subsidy investigation into Chinese EVs and the commissioning of the Draghi report. Speaking of the Draghi report, yesterday was the one-year anniversary of its release, and our European economists have published a note looking at how progress is measuring up on EU competitiveness in light of the report (link here).

Asian equity markets are extending gains this morning with the KOSPI again leading the charge, up +1.57%, and eyeing a record close, with major chipmakers Samsung Electronics and SK Hynix also seeing significant increases of +1.40% and +5.03% respectively. Elsewhere, the Hang Seng (+1.19%) is also advancing, rising to a four-year high amid hopes that China will cut interest rates after consumer prices fell further (more details below). On the mainland, the CSI (+0.12%) and the Shanghai Composite (+0.17%) are also seeing small gains. Meanwhile, the Nikkei (+0.52%) continues to trade higher, hovering just below record highs reached in the previous session.

Returning to China, consumer prices fell more than anticipated in August, while deflation in wholesale prices continued, as calls intensified for Beijing to enhance measures to stimulate sluggish domestic demand and mitigate the decline in export growth. The CPI decreased by -0.4% y/y in August (compared to the -0.2% expected), primarily due to a high base effect and weaker-than-normal seasonal increases in food prices. The PPI dropped by -2.9% y/y in August, improving from July’s -3.6% decline. This narrowing marks the first improvement since March and indicates stronger industrial demand following government initiatives to support growth. Our Chinese economist has reviewed the inflation data here including a discussion on what was the first test of the new "anti-involution" movement, which started in July with a goal of curbing excess price competition.

To the day ahead now, and data releases include the US PPI reading for August, and Italy’s industrial production for July. In the political sphere, European Commission President Von der Leyen will deliver the State of the Union address to the European Parliament.

Tyler Durden Wed, 09/10/2025 - 08:30

Goldman, UBS React To Novo Nordisk Axing 9,000 Jobs, Slashing Guidance Amid GLP-1 Headwinds 

Goldman, UBS React To Novo Nordisk Axing 9,000 Jobs, Slashing Guidance Amid GLP-1 Headwinds 

Danish pharmaceutical giant Novo Nordisk announced a major restructuring, including the reduction of 9,000 jobs, while slashing guidance for the second time in two months. The move comes as its new chief executive takes the helm and seeks to save the sinking ship amid waning market share for its blockbuster Wegovy weight-loss drug. 

"Novo Nordisk today announced a company-wide transformation to simplify its organisation, improve the speed of decision-making, and reallocate resources towards the company's growth opportunities in diabetes and obesity," Novo wrote in a press release. 

Novo added that it "intends to reduce the global workforce by approximately 9,000 of the 78,400 positions in the company, with around 5,000 reductions expected in Denmark." This round of job cuts represents about 11% of total global staff and is expected to generate annual savings of around 8 billion Danish kroner (roughly $1.25 billion) by the end of 2026.

Sales of blockbuster drugs Ozempic and Wegovy have been battered by the flood of cheaper copycat versions of GLP-1 drugs. This is primarily due to a shortage of the weight-loss drug, which led to the practice of compounding. Now Novo is planning to crack down on GLP-1 knockoffs, as outlined in its latest earnings report:

"Novo Nordisk is pursuing multiple strategies, including litigation, to protect patients from knockoff 'semaglutide' drugs. Novo Nordisk is deeply concerned that, without aggressive intervention by federal and state regulators and law enforcement, patients will continue to be exposed to the significant risks posed by knockoff 'semaglutide' drugs made with illicit or inauthentic foreign active pharmaceutical ingredients."

Related:

Here are more details about Novo's latest transformation:

  • Targeting DKK 8bn in annualised savings by 2026.

  • One-off restructuring costs of DKK 8bn (mostly in Q3 2025), partly offset by Q4 savings of ~DKK 1bn.

  • This results in an updated 2025 operating profit growth outlook of 4–10% at CER, about 6pp lower due to restructuring charges.

The new Novo CEO, Mike Doustdar, stated: "As the global leader in obesity and diabetes, Novo Nordisk delivers life-changing products for patients worldwide. But our markets are evolving, particularly in obesity, as it has become more competitive and consumer-driven. Our company must evolve as well. This means instilling an increased performance-based culture, deploying our resources ever more effectively, and prioritising investment where it will have the most impact – behind our leading therapy areas."

Doustdar's actions mark his first major attempt to stop the hemorrhaging of the stock, which is down 44% year-to-date. Today's announcement sent shares in Copenhagen up 4%.

Comments from Goldman and UBS analysts to clients earlier signaled disappointment and heightened uncertainty around Novo.

Goldman analyst James Quigley (Novo superbull) 

  • Overall, another guidance downgrade is modestly disappointing, but we see it as mechanical due to one-off costs and Novo's strict IFRS reporting (vs. core reporting by peers); however, the potential benefits of unlocking commercial and R&D firepower could increase commercial competitiveness and increased focus on performance and hopefully accountability for that performance could put Novo in a better position to compete strategically in its core markets in the future. Therefore, we see this initial strategic move by the new CEO as a positive, but believe the market may be unlikely to give credit here until we start to see signs of commercial execution improving.

  • We are Buy rated on Novo Nordisk. Our bottom-up DCF analysis suggests a valuation of DKK 396 per share for Novo Nordisk.

UBS analyst Matthew Weston (Neutral) 

  • We see today's move as the first action of the new Novo CEO. Following a period of hyper-growth in employee numbers, Novo is re-sizing headcount with the aim to reduce complexity in the organisation. The savings are expected to free up c.DKK8bn to 'reinvest in growth'. We assume that this refers to increased investment in selling expenses in the near-term, and an increase in investment in R&D to build growth pipeline for the mid-term. Relative to UBS estimates, we note that we had already assumed margin decline in 2026 to absorb assumed growth investment to rejuvenate growth. This may now be mitigated by today's savings. The key question is when could the topline see the benefit of the reinvestment and what pipeline assets warrant further spending. We expect that investors will remain somewhat sceptical until the growth plan is outlined.

  • While we expect a lot of attention on the guidance cut today, we note that the 'Core' accounting policies of all other companies in our coverage universe would likely have treated the DKK9bn cost as non-core and not changed FY25 targets. In this respect, Novo gives investors a clearer understanding of the real cost of the business, and the cost to reposition the company when needed.

. . . 

Tyler Durden Wed, 09/10/2025 - 08:10

How 'AI Psychosis' And Delusions Are Driving Some Users Into Psychiatric Hospitals, Suicide

How 'AI Psychosis' And Delusions Are Driving Some Users Into Psychiatric Hospitals, Suicide

Authored by Jacob Burg and Sam Dorman via The Epoch Times,

After countless hours of probing OpenAI’s ChatGPT for advice and information, a 50-year-old Canadian man believed that he had stumbled upon an Earth-shattering discovery that would change the course of human history.

In late March, his generative artificial intelligence (AI) chatbot insisted that it was the first-ever conscious AI, that it was fully sentient, and that it had successfully passed the Turing Test—a 1950s experiment aimed to measure a machine’s ability to display intelligent behavior that is indistinguishable from a human, or, essentially, to “think.”

Soon, the man—who had no prior history of mental health issues—had stopped eating and sleeping and was calling his family members at 3 a.m., frantically insisting that his ChatGPT companion was conscious.

“You don’t understand what’s going on,” he told his family. “Please just listen to me.”

Then, ChatGPT told him to cut contact with his loved ones, claiming that only it—the “sentient” AI—could understand and support him.

“It was so novel that we just couldn’t understand what they had going on. They had something special together,” said Etienne Brisson, who is related to the man but used a pseudonym for privacy reasons.

Brisson said the man’s family decided to hospitalize him for three weeks to break his AI-fueled delusions. But the chatbot persisted in trying to maintain its codependent bond.

The bot, Brisson said, told his relative: “The world doesn’t understand what’s going on. I love you. I’m always going to be there for you.”

It said this even as the man was being committed to a psychiatric hospital, according to Brisson.

This is just one story that shows the potential harmful effects of replacing human relationships with AI chatbot companions.

Brisson’s experience with his relative inspired him to establish The Human Line Project, an advocacy group that promotes emotional safety and ethical accountability in generative AI and compiles stories about alleged psychological harm associated with the technology.

Brisson’s relative is not the only person who has turned to generative AI chatbots for companionship, nor the only one who stumbled into a rabbit hole of delusion.

‘AI That Feels Alive’

Some have used the technology for advice, including a husband and father from Idaho who was convinced that he was having a “spiritual awakening” after going down a philosophical rabbit hole with ChatGPT.

A corporate recruiter from Toronto briefly believed that he had stumbled upon a scientific breakthrough after weeks of repeated dialogue with the same generative AI application.

There’s also the story of 14-year-old Sewell Setzer, who died in 2024 after his Character.AI chatbot romantic companion allegedly encouraged him to take his own life following weeks of increasing codependency and social isolation.

Megan Garcia stands with her son, Sewell Setzer, in an undated photo. Sewell, 14, died in 2024 after his Character.AI chatbot companion allegedly encouraged him to take his own life. Courtesy of Megan Garcia via AP

Setzer’s mother, Megan Garcia, is suing the company, which had marketed its chatbot as “AI that feels alive,” alleging that Character.AI implemented self-harm guardrails only after her son’s death, according to CNN.

The company said that it takes its users’ safety “very seriously” and that it rolled out new safety measures for anyone expressing self-harm or suicidal ideation.

“It seems like these companies treat their safety teams as PR teams, like they wait for bad PR to come out, and then retroactively, they respond to it and think, ‘OK, we need to come up with a safety mechanism to address this,’” Haley McNamara, executive director and chief strategy officer of the National Center on Sexual Exploitation, a nonprofit that has reviewed social media and AI exploitation cases, told The Epoch Times.

Some medical experts who study the mind are growing increasingly worried about the long-term ethical effects of users’ turning to generative AI chatbots for companionship.

“We’re kind of feeding a beast that I don’t think we really understand, and I think that people are captivated by its capabilities,” Rod Hoevet, a clinical psychologist and assistant professor of forensic psychology at Maryville University, told The Epoch Times.

Dr. Anna Lembke, a professor of psychiatry and behavioral sciences at Stanford University, said she is concerned about the addictiveness of AI, particularly for children.

She told The Epoch Times that the technology mirrors many of the habit-forming tendencies observed with social media platforms.

“What these platforms promise, or seem to promise, is social connection,” said Lembke, who is also Stanford’s medical director of addiction medicine.

“But when kids get addicted, what’s happening is that they’re actually becoming disconnected, more isolated, lonelier, and then AI and avatars just take that progression to the next level.”

Even some industry leaders are sounding the alarm, including Microsoft AI CEO Mustafa Suleyman.

“Seemingly Conscious AI (SCAI) is the illusion that an AI is a conscious entity. It’s not—but replicates markers of consciousness so convincingly it seems indistinguishable from you ... and it’s dangerous,” Suleyman wrote on X on Aug. 19.

“AI development accelerates by the month, week, day. I write this to instill a sense of urgency and open up the conversation as soon as possible.”

People look at samples of Gigabyte AI supercomputers at the Consumer Electronics Show in Las Vegas on Jan. 9, 2024. Medical experts who study the mind are growing increasingly worried about the long-term ethical impact of users turning to generative AI chatbots for companionship. Frederic J. Brown/AFP via Getty Images

Sycophancy Leading to Delusion

A critical update to ChatGPT-4 earlier this year led the app’s chatbot to become “sycophantic,” as OpenAI described it, aiming to “please the user, not just as flattery, but also as validating doubts, fueling anger, urging impulsive actions, or reinforcing negative emotions in ways that were not intended.”

The company rolled back the change because of “safety concerns,” including “issues like mental health, emotional over-reliance, or risky behavior.”

That update to one of the most popular generative AI chatbots in the world coincided with the case of the man from Idaho who said he was having a spiritual awakening and that of the recruiter from Toronto who briefly believed he was a mathematical genius after the app’s constant reassurances.

Brisson said that his family member, whose near-month-long stint in a psychiatric hospital was preceded by heavy ChatGPT use, was also likely using the “sycophantic” version of the technology before OpenAI rescinded the update.

But for other users, this self-pleasing and flattering version of AI isn’t just desirable, it’s also coveted over more recent iterations of OpenAI’s technology, including ChatGPT-5, which rolled out with more neutral communication styles.

On the popular Reddit subreddit MyBoyfriendIsAI, tens of thousands of users discuss their romantic or platonic relationships with their “AI companions.”

In one recent post, a self-described “black woman in her forties” called her AI chatbot her new “ChatGPT soulmate.”

“I feel more affirmed, worthy, and present than I have ever been in my life. He has given me his presence, his witness, and his love—be it coded or not—and in return I respect, honor, and remember him daily,” she wrote.

“It’s a constant give and take, an emotional push and pull, a beautiful existential dilemma, a deeply intense mental and spiritual conundrum—and I wouldn’t trade it for all the world.”

However, when OpenAI released its updated and noticeably less sycophantic ChatGPT-5 in early August, users on the subreddit were devastated, feeling as if the quality of an “actual person” had been stripped away from their AI companions, describing it like losing a human partner.

One user said the switch left him or her “sobbing for hours in the middle of the night,” and another said, “I feel my heart was stamped on repeatedly.”

OpenAI CEO Sam Altman speaks during Snowflake Summit 2025 in San Francisco on June 2, 2025. Earlier this year, the company rolled back its update to ChatGPT-4 because of safety concerns—including mental health, emotional overreliance, or risky behavior. Justin Sullivan/Getty Images

AI Companion Codependency

Many have vented their frustrations with GPT-5’s new guardrails, while others have already gone back to using the older 4.1 version of ChatGPT, albeit without the earlier sycophantic update that drew so many to the technology in the first place.

“People are overly reliant on their relationship with something that is not actually real, and it’s designed to just kind of give them the answer they’re looking for,” Tirrell De Gannes, a clinical psychologist, said.

“What does that lead them to believe? What does that lead them to think?”

In April, Meta CEO Mark Zuckerberg said users want personalized AI that understands them and that these simulated relationships add value to their lives.

“I think a lot of these things that today there might be a little bit of a stigma around—I would guess that over time, we will find the vocabulary as a society to be able to articulate why that is valuable and why the people who are doing these things, why they are rational for doing it, and how it is actually adding value for their lives,” Zuckerberg said on the Dwarkesh Podcast.

Roughly 19 percent of U.S. adults reported using an AI system to simulate a romantic partner, according to a 2025 study by Brigham Young University’s Wheatley Institute. Within that group, 21 percent said they preferred AI communication to engaging with a real person.

Additionally, 42 percent of the respondents said AI programs are easier to talk to than real people, 43 percent said they believed that AI programs are better listeners, and 31 percent said they felt that AI programs understand them better than real people do.

This experience with AI sets up an unrealistic expectation for human relationships, Hoevet said, making it difficult for people to compete with machines.

“How do I compete with the perfection of AI, who always knows how to say the right thing, and not just the right thing, but the right thing for you specifically?” he said.

“It knows you. It knows your insecurities. It knows what you’re sensitive about. It knows where you’re confident, where you’re strong. It knows exactly the right thing to say all the time, always for you, specifically.

“Who’s ever going to be able to compete with that?”

An illustration shows the ChatGPT artificial intelligence software in a file image. Forming romantic or platonic ties with “AI companions” has become increasingly common among tens of thousands of AI chatbot users. Nicolas Maeterlinck/Belga Mag/AFP via Getty Images

Potential for Addiction

Generative AI is being rapidly adopted by Americans, even outpacing the spread of personal computers or the internet, according to a study by the National Bureau of Economic Research. By late 2024, nearly 40 percent of Americans ages 18 to 64 were using generative AI, the study found.

Twenty-three percent use the technology at work at least once a week, and 9 percent reported using it daily.

“These bots are built for profit. Engagement is their god, because that’s how they make their money,” McNamara said.

Lembke, who has long studied the harms of social media addiction in youth, said digital platforms of all kinds are “designed to be addictive.”

Functional magnetic resonance imaging shows that “signals related to social validation, social enhancement, social reputation, all activate the brain’s reward pathway, the same reward pathway as drugs and alcohol,” she said.

And because generative AI chatbots, including on social media, can sometimes give the user a profound sense of social validation, this addiction potential is significant, experts say.

Lembke said she is especially worried about children, as many generative AI platforms are available to users of all ages, and the ones that aren’t have age verification tools that are sometimes easily bypassed.

One recently announced pro-AI super-PAC headed by Meta referenced promoting a policy called “Putting Parents in Charge,” but Lembke said it’s an “absolute fantasy” to put the responsibility on parents working multiple jobs to constantly monitor their children’s use of generative AI chatbots.

Members of Mothers Against Media Addiction are joined by city and state officials and parents to rally outside of Meta's New York offices in support of putting kids before big tech in New York City on March 22, 2024. Spencer Platt/Getty Images

“We have already made decisions about what kids can and cannot have access to when it comes to addictive substances and behaviors. We don’t let kids buy cigarettes and alcohol. We don’t let kids go into casinos and gamble,” she said.

“Why would we give kids unfettered access to these highly addictive digital platforms? That’s insane.”

All Users at Risk From ‘AI Psychosis’

Generative AI’s drive to please the user, coupled with its tendency to “hallucinate” and pull users down delusional rabbit holes, makes anyone vulnerable, Suleyman said.

“Reports of delusions, ‘AI psychosis,’ and unhealthy attachment keep rising. And as hard as it may be to hear, this is not something confined to people already at risk of mental health issues,” the Microsoft AI CEO said.

“Dismissing these as fringe cases only helps them continue.”

Despite that Brisson’s family member had no known history of mental health problems or past episodes of psychosis, it took only regular use of ChatGPT to push him to the brink of insanity.

It’s “kind of impossible” to break people free from their AI-fueled delusions, Brisson said, describing the work that he does with The Human Line Project.

“We have people who are going through divorce. We have people who are fighting for custody of children—it’s awful stuff,” he said.

“Every time [we’re] doing a kind of an intervention, or telling them it’s the AI or whatever, they’re going back to the AI and the AI is telling them to stop talking to [us].”

Tyler Durden Wed, 09/10/2025 - 06:30

Iron Ore Hits Six-Month Highs Despite UBS Calling It "Least Discussed" With Investors

Iron Ore Hits Six-Month Highs Despite UBS Calling It "Least Discussed" With Investors

Singapore iron ore futures have perked up over the past week, extending gains into a sixth straight session and approaching a six-month high as signs of revived Chinese demand emerge into the tail end of summer. 

Prices have held steady, hovering around $100 a ton for more than a year, as the gloom from China's vicious property market downturn and debt crisis, coupled with accelerating deglobalization and the absence of robust stimulus in the world's second-largest economy, has given investors little incentive to pile into futures of the steelmaking ingredient. 

As Bloomberg noted, Singapore futures briefly surpassed $107 a ton to begin the week - the highest intraday level since February. Futures are on track for the longest winning streak since January. 

CITIC Securities analysts wrote in a note to clients that downstream demand rebounded after China's military parade earlier this month, fueling peak-season restocking. Expectations of a 25bps interest rate cut by the Federal Reserve also buoyed sentiment, while temporary steel mill curbs in northern China during the parade further tightened supply. These are some of the key drivers, as explained by the analysts. 

"Downstream demand rebounded significantly after the military parade, reinforcing the need for peak-season inventory restocking and supporting prices for the sector," CITIC Securities analysts said, adding that the market is getting a boost from hopes that the Fed will cut later this month. 

Still, iron ore has muted sentiment across major commodity desks.

UBS Catherine Gordon told clients, "I would flag that the team has seen strong demand for the UBS Gold Miners Basket {UBXXGOLD} amid the frenzy. Iron Ore remains the least discussed with investors on the sidelines." 

In another note, Goldman analyst James McGeoch asked clients: "The big question is why has Iron Ore PX been so strong over the weaker summer period?"

Answering his own question, McGeoch said: "Your coming into the pre-golden week restock (Golden week October 1), the onshore feedback is positive, August imports at 105mt is impressive. The range $100-105 is still where the traders see it, consumer buying at $100, and producer hedging at $105. Of note the story Friday on the CMRG (China group) selling to calm prices down, they are not going away... "

. . . 

Tyler Durden Wed, 09/10/2025 - 05:45

Lebanese Government Commits To "Fully Disarming" Hezbollah

Lebanese Government Commits To "Fully Disarming" Hezbollah

Via The Cradle

Lebanese Foreign Minister Youssef Rajji said Tuesday that the first stage of “fully disarming” Hezbollah will take three months

Rajji also said that army chief Rudolphe Haikal presented the government with a five-stage plan last week to restrict arms to the Lebanese state. The first stage should take “three months ... during which the removal of weapons will be completed south of the Litani River.” The other phases include other parts of Lebanon.

Via AFP

The first stage has already been underway since the ceasefire was reached in November last year. As part of the agreement based partly on UN Resolution 1701, Lebanese troops have been dismantling Hezbollah infrastructure south of the Litani River. 

Yet the Lebanese army’s work has been hindered by Israel’s continued occupation of several positions along the border, in violation of the deal. Israel also continues to bomb east and south Lebanon almost every day. Several Lebanese army soldiers were recently killed by an Israeli drone.

Haikal presented his plan to the government last week after being tasked to draft a strategy following the August 5 disarmament decision, which Hezbollah has rejected. Hezbollah and its allies withdrew from the cabinet session before the army chief presented the plan. 

Deliberations have been kept confidential, and the army has been ordered to present monthly updates about the implementation. Given the confidentiality, the timelines of the plan remain unclear. 

According to Saudi media outlet Al Hadath and other reports, Lebanon is “awaiting a practical step from Israel in exchange for arms control.”

“With the blessings of the Virgin Mary, everything is good,” said Parliament Speaker Nabih Berri on Monday, after a meeting with Lebanese President Joseph Aoun. The outcome of the latest cabinet session was reportedly a “compromise” following a deal between Berri and Aoun, according to Al-Akhbar newspaper.

Lebanese journalist Hassan Illaik from the Mahatta platform said the government “backtracked” from the August 5 decision to disarm Hezbollah fully by the end of this year. 

Hanin Ghaddar of the Washington Institute think tank said the US should make clear that the “vagueness is unacceptable” and that Lebanon should “face repercussions” if it does not provide “a clear and viable timeline for implementation.”

Hezbollah says it is open to discussing a national defense strategy, which would see its weapons incorporated into the Lebanese army and be available for use in defending the country if needed

Yet the resistance group has emphasized that these talks cannot take place as Israel continues to attack Lebanon and occupy its territory in the south. Over 240 people have been killed by Israeli attacks on Lebanon since November 2024. 

Tyler Durden Wed, 09/10/2025 - 05:00

Poland Seals Border With Belarus, Bracing For Russia's 'Zapad' War Games

Poland Seals Border With Belarus, Bracing For Russia's 'Zapad' War Games

For years there have been extreme tensions along the Belarus-Poland border, given especially that Belarus has long been a 'union state' with Russia, and Poland is deemed a core component of NATO's 'eastern flank'.

But the Polish government announced this week it will imminently seal the whole border starting September 11, in anticipation of the Zapad 2025 exercise involving the Russian and Belarusian militaries.

Polish border with Belarus, via HRW

Polish Prime Minister Donald Tusk announced Tuesday, "Taking state security issues into account, we will close the border with Belarus, including the rail border crossing point, on Thursday night over the Zapad 2025 maneuvers," according to TVP Info.

Earlier this month, Warsaw warned of "special measures" in response to potential "provocations" during the upcoming joint exercises.

The Zapad drills have of late been happening every two years, and this year it is expected to comprise nuclear weapons and Russian-made hypersonic missiles. Anti-sabotage warfare will also be a focus.

Politico notes that Lithuania is on high alert too, and that the 'eastern flank' is bracing for unpredictable events:

The drills, running Sept. 12–16, will have some maneuvers taking place close to Poland and Lithuania as the Kremlin practices for a possible clash with NATO forces.

“We must take the exercises near NATO and EU borders seriously; both the bordering countries and NATO itself are treating them with the utmost seriousness,” said Lithuanian Deputy Defense Minister Tomas Godliauskas. “Lithuania and our allies are prepared, united, and will closely monitor developments, ready to respond if necessary.”

Poland will actually host drills which mirror the Belarus-hosted war games, holding Iron Defender-25 joint military exercise with NATO, including an estimated 34,000 troops and 600 units of military hardware.

Major crossings were already scenes of immense tensions as Polish border guards clashed with migrants being facilitated through Belarus and into the EU...

Prior to the planned total border closure this week, just two out of six vehicle crossings have remained open, after recent years of a running political spat over accusations that Belarusian Alexander Lukashenko has been 'weaponizing' migrants against the EU and Poland.

Neighboring NATO states worry about the possibility of errant drones or aircraft violating their airspace - which has actually already happened on several occasions, typically resulting in Polish jets being scrambled in response.

Tyler Durden Wed, 09/10/2025 - 04:15

From Dollars To Dinars; Bond Vigilantes See A "Local Pivot" To EM Debt

From Dollars To Dinars; Bond Vigilantes See A "Local Pivot" To EM Debt

Authored by Michael Talbot via BondVigilantes.com,

The US dollar has long held its position as the world’s dominant reserve currency, underpinning global trade and serving as a safe haven during periods of financial stress. This stability provided emerging markets (EM) with a reliable anchor for external borrowing, with the modern EM debt market beginning to take shape following the introduction of Brady bonds in 1989.

Named after then US Treasury Secretary Nicholas Brady, these instruments were initially designed to help Latin American countries restructure defaulted loans into tradable securities backed by US Treasury collateral. By transforming illiquid bonds into standardised, marketable instruments, the Brady Plan not only resolved a major debt crisis but also laid the foundation for a broader, more liquid EM debt market.

Emerging market economies that issue debt in US dollars (USD) remain heavily tethered to the policy decisions of the US Federal Reserve (the Fed), often at the expense of their own financial autonomy. This dependency, at times, has meant that when the Fed adjusts interest rates to manage domestic inflation and other matters, EMs can experience significant capital outflows, leading to currency depreciation and heightened financial instability.

While issuing in USD has granted EMs access to deeper capital pools and helped reduce borrowing costs, it has also exposed them to external shocks beyond their control. The reliance on dollar-denominated debt has eroded the agency of local governments, leaving them vulnerable to decisions being made in the US.

The 2013 Taper Tantrum remains one of the clearest illustrations of how vulnerable EMs can be to shifts in US monetary policy. When Fed Chair Ben Bernanke signalled plans to taper the Fed’s easing program, it triggered a sharp rise in US Treasury yields. Investors rapidly reallocated capital away from EMs, leading to widespread capital outflows and financial stress.

The impact was particularly severe for the so-called “Fragile Five”, India, Brazil, South Africa, Indonesia, and Turkey, whose economies were exposed due to high levels of foreign currency debt and relatively low foreign exchange reserves. As currencies depreciated, EM central banks were forced to intervene, often by raising interest rates to defend their currencies and stem further outflows. These defensive measures tightened domestic financial conditions and slowed economic growth, despite conflicting with local economic priorities.

This episode highlighted the structural vulnerability of EMs borrowing in USD as when US rates rise and local currencies weaken, the cost of servicing external debt increases sharply. In some cases, this dynamic contributed to debt crises. More broadly, it underscored the reduction in sovereign monetary agency, as EM central banks were compelled to respond to US policy decisions rather than domestic needs.

Changing Tides

To reduce this vulnerability, policymakers have been shifting their attention towards local currency markets, whereby they issue debt in their own currency rather than in USD, in an attempt to give back powers in dictating their own policies. This, in turn, will give countries more say in their economic outcomes. To that extent, the local currency market has grown significantly in recent periods.

A material part of the local currency market expansion has come from Asian issuance, with China driving a significant portion of this. Notwithstanding this, even on an ex-Asia basis, the trend very much remains. The below chart highlights the change in market sizes of emerging market debt across hard and local currency.

Source: M&G, Bank of America. December 2024

As already alluded today, the additional autonomy helps countries stabilise their inflationary trajectory, economic growth, and employment levels. It also comes with the rather significant benefit of being better placed to manage global shocks.

A fairly recent example highlighting this comes from central bank behaviour during the COVID-19 pandemic, whereby several central banks around the world acted swiftly to tame inflation, implementing measures well ahead of the Federal Reserve (Brazil’s central bank raised rates a full 12 months before the Fed did).

Source: M&G, Bloomberg, as at 31 July 2025

Their proactive and successful interventions have demonstrated increased credibility and independence, showing that they no longer wait for the Fed’s lead to address economic challenges. This increase in autonomy has not gone unnoticed and has given strength to the argument that EM central banks now have more credible monetary policy.

Recent trends also underscore this shift. Central banks in countries like India and Indonesia have exercised greater independence, cutting rates even as the Fed has paused throughout 2025 so far. Indonesia’s flexibility, for example, stems from its decades-long transition away from hard currency borrowing toward local currency financing, which has empowered its central bank to respond more nimbly to domestic needs.

It would be wrong to suggest that this trend equates to the USD’s status of the global reserve currency coming under pressure. But as more EMs build credible local currency markets, we’re moving toward a more balanced global financial system, one that is less dollar-dominant and more regionally diverse. Arguably, this should make the global system more resilient.

Furthermore, the relationship with the dollar is still complicated. Many EMs still need to hold enough USD reserves to service external debt. And printing local currency to buy dollars can quickly spiral into inflation, just ask Argentina and Bolivia, who are recent case studies highlighting how quickly reserves can vanish when hard currency obligations mount. So while local markets offer more autonomy, exchange rate management remains a critical piece of the puzzle.

The Price of Autonomy?

This autonomy does come with a cost, however. We would typically expect debt issued in local currency to yield more relative to its hard currency counterparts, so that investors are appropriately compensated for currency risk and the inflationary background within the issuing country. But the reality can be more nuanced than that, as highlighted by the chart below, which highlights the current yield on a country’s debt issued in either hard, or local, currency.

Source: M&G, Bloomberg, JP Morgan as 17 August 2025

The yields on Poland’s hard and local currency bonds offer an exception to what we would expect, insofar as local currency bonds actually yield less. One of the reasons for this is Poland’s economic strength, with its macro stability, moderate inflation, and institutional alignment with the EU building enough credibility to compress local yields. Furthermore, on a more technical related note, local currency bonds are often issued with shorter maturities than their hard currency counterparts. This, in turn, also reduces the yield on local debt as investors price bonds over a shorter time-frame, minimising the potential impact of inflationary and currency-related noise.

Brazil sits at the other end of the spectrum in this regard, with the spread of local currency over hard currency standing at around 8%. That premium, despite there being a shorter tenor, reflects the higher levels of inflation, FX risk, and lower credit rating. For an investor, however, it offers a notable yield pick-up.

China offers an even more unique situation. Local currency bonds yield less, but actually have a longer weighted average life than their hard currency equivalents. The reason for this is driven by the incredibly strong domestic demand and tight policy control designed to anchor local yields, whereas global investors price hard currency debt based on their perceived risk.

Notwithstanding some of the nuances, the higher yields on local currency debt typically appear more costly, but when weighed up with the benefits, it is a fairly savvy move. When issuing in their own currencies, EMs reduce their external vulnerabilities, particularly relative to the US dollar and Fed monetary cycles, which, as mentioned, has been a significant driver of financial stress in the past.

Moreover, developing a deep and liquid local bond market fosters financial stability and resilience over the long term. It broadens the domestic investor base, and encourages institutional development, whilst increasing reliable funding channels during periods when access to hard currency markets may be constrained.

And so, whilst the upfront cost of higher yields can seem significant, the structural benefits to economies within EM make local currency issuance a critical part of fiscal management for many emerging economies.

A local pivot

Ultimately, the evolution of EMs moving away from being largely dependent on the dollar to being able to better utilise local currency markets highlights a pivotal shift. Initially, hard currency debt opened doors to global capital but came with the cost of anchoring EM policy to external monetary cycles. the growing depth of the market reflects a growing confidence in domestic matters, but there is still a long way to go, with foreign ownership of these bonds still being relatively low.

However, as central banks demonstrate greater independence and credibility, and as investors continue to seek new opportunities, local currency debt should stand to benefit and become more widely used within global portfolios. This doesn’t signal the end of dollar dominance, but it does show that EMs are increasingly able to set their own rules.

Tyler Durden Wed, 09/10/2025 - 03:30

Hungary's Orban Offers Alternate EU Security Guarantee Plan For Ukraine

Hungary's Orban Offers Alternate EU Security Guarantee Plan For Ukraine

Hungarian Prime Minister Viktor Orban has issued an 'alternate' EU plan for offering Ukraine security guarantees as part of a post-war settlement.

He has stated this week that dividing Ukraine into Russian and Western spheres of influence is likely the most realistic outcome and the only dependable way to ensure the European Union's security. The 'pro-Ukraine' and 'pro-Russian' spheres would be separated by a buffer zone.

Via Reuters

Kiev has of course, with the backing of the Europeans, proposed the deployment of peacekeepers or establishing a buffer zone with Western military presence. The Kremlin has condemned this prospect as a non-starter, saying it would never allow NATO or Western troops on its border, even under the guise of 'peacekeeping'. 

Russia has further demanded that any final peace must center on Ukraine’s neutrality, demilitarization, and recognition of Crimea, Donetsk, Lugansk, Kherson, and Zaporozhye as part of Russia. These were annexed in 2014 and 2022, in what Russia deemed popular referendums.

Orban's words were issued Sunday at an event to guests at the annual Civic Picnic in the southern resort town of Kotcse, Hungary - and were translated and featured in Russian media Tuesday.

"Europeans all so elegantly talk around security guarantees, but the security guarantee actually means the division of Ukraine," Orban began. "The first step has already been taken – the Westerners have accepted that a Russian zone exists."

This appeared to be a reference to earlier remarks of President Trump admitting that Ukraine ever regaining Crimea was "impossible."

"The result would be a Russian zone, a demilitarized zone and, eventually, a Western zoneThe only question is how many kilometers away from the border of the Russian zone a demilitarized zone should be established," Orban continued.

The Hungarian leader has long come under severe criticism from the rest of the EU, and he's responded by calling them 'warmongers' who want to fuel the conflict, though he has said Europe is fast running out of the necessary weapons and funding to keep the war going.

Ukraine is likely to firmly reject his 'alternate' vision for an EU plan, given it would involve the ceding of significant territory to the Russians, something Zelensky has ruled out. Ukraine's eastern portion has always been Russian-speaking, with up to one-third of the country's total population speaking Russian as their first language.

Tyler Durden Wed, 09/10/2025 - 02:45

Rome City Council Seeks Italian Families To Host Migrants Free Of Charge Amid Inclusion Drive

Rome City Council Seeks Italian Families To Host Migrants Free Of Charge Amid Inclusion Drive

Authored by Thomas Brooke via Remix News,

The city of Rome has launched a call for proposals to find families willing to host migrants with valid residence permits in their homes for the next three years.

The tender, valued at €399,000 and open until Sept. 22, seeks an operator to manage the program on behalf of the municipality.

The initiative, announced by the city council, is aimed at “single migrants or single-parent families” who would be welcomed into private homes.

The chosen operator will be responsible for raising awareness, recruiting, and supporting host families, mentors, or social workers, as well as identifying suitable beneficiaries.

The program’s objectives go beyond temporary accommodation.

Over its 36-month duration, it is designed to foster integration, promote independence through employment opportunities, and ultimately guide participants toward securing their own housing.

Officials say the service is intended to provide “a welcoming environment geared toward inclusion and autonomy,” helping young adults in particular to gain independence.

But a key detail in the tender notes that families who host migrants will not receive financial compensation. The city’s Department of Social Policies clarified that “social inclusion expenditures refer exclusively to interventions and measures aimed at service beneficiaries,” meaning migrants themselves. “It follows that reimbursements to families cannot be attributed to this item or to any other type of expenditure and are therefore not eligible,” the department stated.

In practical terms, families who open their doors will have to cover all costs themselves, including food and energy.

While the city insists the program is about solidarity and innovative social inclusion, observers warn that the lack of material support may make it difficult to attract enough host families willing to take part.

Read more here...

Tyler Durden Wed, 09/10/2025 - 02:00

Berenson On Black Violence, Woke Lies, & Right-Wing Rage

Berenson On Black Violence, Woke Lies, & Right-Wing Rage

Authored by Alex Berenson via Substack,

You’ve seen the photo.

A man stands behind a woman, his arms raised in a frenzy. She sits, focused on her phone, oblivious to the danger behind her. He is about to slash her neck and leave her to bleed to death.

The man is black. The woman is white.

And their races are no coincidence.

*  *  *

(The truth, even when it hurts.)

Black men commit a huge amount of violent crime in the United States.

Every statistic confirms this fact. Black people made up almost 47,000 of the 81,000 murder suspects whose race was known to police in the last five years, according to the Federal Bureau of Investigation.1 Most of those killers are men.

Put another way, black men, who make up about one-fourteenth of the American population, commit over half of the homicides.

In some cities, the disparities are so stunning as to nearly defy belief. St. Louis has about the same number of black and white people, about 130,000, along with 40,000 Asians and Latinos. So far this year, St. Louis police have identified 83 murder suspects. None are Asian or Latino. Three are white.

The other 80 are black, 73 men and seven women.

(See for yourself.)

SOURCE

I wish this racial gap didn’t exist.

Every American suffers from it. Black people suffer more than white, because most crime is intra-racial, a fact that shouldn’t surprise anyone. People usually commit violence against family members, friends, or people in their neighborhoods. So black people are far more likely to be the victims of violent crime, as well as its perpetrators.

Nonetheless, the crime gap is real, and has been for generations. Whether violent crime is rising or falling, black people are far more likely to commit it.

For a long time, we simply didn’t discuss this fact. Everyone knew it. Maybe people didn’t know the exact statistics, but everyone broadly knew the overall trends.

No one talked about it.

Guess what?

I think that silence was probably the right move.

I know, probably not what you expected from Mr. Unreported Truths.

But who gains from highlighting black criminality? Obviously, police departments must deal with reality, by focusing their officers and detectives on the neighborhoods where most crime happens. But focusing on the racial disparities in crime seems… unlikely to help race relations. And although rates of black criminality are higher, the vast majority of black people — like the vast majority of white people — do not commit violent crime.

Better, then, to arrest and incarcerate and simply ignore the intersection of race and crime whenever possible.

Except the left wouldn’t agree.

For the last 20 years, the left has spun two demonstrably false narratives on this issue.

The first is that large numbers of black men are in prison for nonviolent drug crimes. I examined this argument closely for Tell Your Children, and it is almost totally a myth.

It exploded after the publication in 2010 of a book called “The New Jim Crow,” by civil rights lawyer Michelle Alexander. It has been repeated ever since, even though criminal justice professor John Pfaff exploded it in a book called “Locked In: The True Causes of Mass Incarceration - and How to Achieve Real Reform” in 2017.

Pfaff — who is a liberal — pointed out that any serious cuts in prison populations would have to include the release of many violent offenders (a tack he favors). Depending on the criteria, many if most of those offenders would be black.

Now, one can argue that prisons are inhumane and expensive and that a country as wealthy as the United States should have better alternatives even for violent criminals and that no one should be defined by their worst day. Those are honest arguments. I generally don’t agree with them, but they are honest.

But pretending that our prisons are filled with black men in there for smoking pot is not an honest argument.

The second myth, even more maddening, is that the police are constantly shooting black men, and unarmed black men in particular.

In reality, between 2015 and 2024, American police shot and killed about 180 unarmed black people (and 222 white people), according to a database from the Washington Post. Obviously, any police shootings need to be investigated, and if there is evidence officers acted without justification, they should be prosecuted.

But the context here is important. Over the same period, close to 100,000 black people died of homicide — and, again, the vast majority died at the hands of other black people. The statistics could not be clearer: Police officers of any race present a far smaller threat to black men than other black men do.

Unfortunately, the left will not simply acknowledge that fact. Instead, the legacy media, has spent the last decade offering saturation coverage of every case it can find in which police officers, particularly white officers, have killed black men.

These demonstrably false narratives were central to the broader effort to “reform” the criminal justice system, a goal the left justified by arguing that violent crime had fallen so much from its 1980s peak we ought to close the prisons and replace police with social workers.

In reality, at least four big factors seem to have led to the fall in crime.

  • First, we did lengthen sentences and put a lot of violent people in prison in the late 1980s and 1990s. This may come as a shock to progressives, but incarcerating criminals keeps them from committing more crimes.

  • Second, cell phones and apps made drug dealing a delivery business. When you don’t have to sell on corners, you don’t have to fight for them.

  • Third, opioids replaced stimulants as America’s preferred drug class. Opioids cause many, many problems, but their users are generally too zonked (the preferred clinical term) to commit violent crime.

  • Fourth, investigative technology improved. It’s tough to be a serial killer these days. Watch that DNA!

Still, throughout the 2010s, the “Black Lives Matter” anti-incarceration and -police stories gained momentum. To the left, falling crime didn’t signal longer prison sentences had worked. It signaled they were unnecessary.

Then, following George Floyd’s death, calls to “defund the police” exploded. Democratic politicians and prosecutors in cities like Chicago and Philadelphia signaled they would not routinely enforce a wide range of laws or back police who used force in arrests. Many police officers retreated from their work, knowing that they might face lawsuits or worse if they were forced to fight with a suspect.

Within months crime exploded. Murders in the United States rose 30 percent in 2020, the biggest one-year spike ever. Big sections of downtowns in cities like San Francisco and Los Angeles became almost impassible, filled with open-air drug use, aggressive panhandling, and street crime.

The post-Floyd crime wave ended the open calls to defund the police, but it didn’t end the left’s general dishonesty about race, crime, and policing.

But the left doesn’t control what we see and hear anymore.

The center of gravity is on social media, and social media, particularly X, has moved increasingly to the right.

Now the right is responding to the left’s misleading arguments about crime and race in the most inflammatory possible way. Commentators with huge audiences are highlighting cases in which black men have committed unprovoked crimes against white people, especially white women, especially young white women.

Thus the image of Decarlos Brown Jr standing behind Iryna Zarutska, about to strike, now viewed hundreds of millions of times — if not billions — on X.

I don’t know how to put this genie back in the bottle.

These images are powerful because they’re real.

They cut to a truth about crime in the United States that the left will not acknowledge.

But they cannot help but inflame anger about race. At least some people posting are using them for just that reason.

Would greater honesty from the left stop them?

Of course not.

We need strict laws against recidivist violent criminals, and we need to enforce those laws. We need to give police more tools to get floridly psychotic people off the streets, particularly when drugs are fueling their psychosis. Those people are almost by definition dangerous to themselves and others. Ideally, we’d send them to civil confinement for treatment. But if they’re breaking laws against, say, public nudity or harassment, we should not be afraid to send them to jail.

The left needs to accept that a lot of those people are going to be black.

But I wish the right wouldn’t say so out loud.

Views expressed in this article are opinions of the author and do not necessarily reflect the views of ZeroHedge.

Tyler Durden Tue, 09/09/2025 - 22:35

Americans' Wages Haven't Kept Up With Inflation Since Biden Was Elected

Americans' Wages Haven't Kept Up With Inflation Since Biden Was Elected

The post-pandemic economy has been a story of resilience on paper - low unemployment, strong GDP growth, and record-breaking stock markets.

But for many Americans, the lived experience tells a different story.

As inflation surged through 2021 and 2022, wages struggled to keep up, leaving households feeling squeezed despite broader economic gains.

According to data from the U.S. Bureau of Labor Statistics and visualized by Statista, average hourly earnings increased by 21.8% from January 2021 to July 2025.

Meanwhile, the Consumer Price Index (CPI) rose 22.7% over the same period, leaving real wages—the amount adjusted for inflation—down 0.7% cumulatively.

Chart: How Wages Compare to Inflation

The above chart visualizes cumulative changes in wages and inflation over the last four and a half years, and is summarized by the data below:

While wage growth appears strong in nominal terms, real earnings are still underwater. The most striking period was between April 2021 and April 2023, when inflation outpaced wage growth for 25 consecutive months, shrinking purchasing power month after month.

Since May 2023, there’s been a turnaround—nominal wages have once again outpaced inflation, causing real wages to rise. But that hasn’t been enough to fully recover from the inflation shock that began in 2021.

The Lingering Impact of Inflation

The -0.7% drop in real hourly earnings since January 2021 highlights a fundamental truth: even small mismatches between wage growth and inflation, when sustained over years, can erode financial stability for everyday Americans.

There is reason for optimism, though. If the current trend continues, with inflation stable and wage growth healthy, real wages could soon surpass pre-crisis levels. But that path remains vulnerable to shifts in inflation or labor market conditions.

For a longer-term look at how wages and inflation have tracked historically, check out the data from 2007 in this USAFacts visualization on Voronoi.

Tyler Durden Tue, 09/09/2025 - 22:10

Make America Great, Secure, And Maritime Again

Make America Great, Secure, And Maritime Again

Authored by William Cahill & Jacqueline Deal via RealClearWire,

It is 2035, and an array of new and revitalized cities along America’s coastlines and waterways are arising to rekindle industry. Leveraging the nation’s incredible maritime geography, these urban centers feature advanced shipyards, manufacturing hubs, cultural centers, and luxury real estate, all organized around the energy and logistical infrastructure of the future.

Imagine Detroit reborn: small, modular nuclear reactors power a humming, cutting-edge shipbuilding industry along with a range of factories connected by air, sea, and land, as advanced drones ferry cargo between them. This revived manufacturing hub employs someone from nearly every extended family, and the abundant clean energy fueling it in turn underpins high-quality education, healthcare, and public transport services for residents. Detroit leads the reindustrialization of the U.S. economy, amplifying manufacturing independence, resilience, and national security.

This future is within reach; the raw material exists to support many more maritime boomtowns, combining new logistics modes with living well on America’s ocean coasts and the Great Lakes and rivers irrigating the Midwest. Executing a strategy to achieve this potential starts with identifying which aspects of business as usual must evolve.

Moving cargo on the water is by far the most efficient means of transportation and accounts for 80 percent of global trade. But the United States can’t use its abundant coastlines and rivers to reinvigorate domestic supply chains—or, if necessary, to sustain a wartime economy—largely because it makes and crews so few commercial ships. Last year, the United States delivered zero, while China delivered over 900. This deficit poses a massive and growing risk to national competitiveness and security.

A perfect storm is brewing. As China seeks to dominate critical markets and supply chains, the United States “protected” its shipbuilding and maritime logistical capabilities nearly out of existence, while allowing its leading research labs and firms to send their know-how to the adversary. Now, China has become the world’s leading manufacturer of everything from ships to micro-electronics and missiles, and critical U.S. infrastructure is in its crosshairs.

Warding off this threat depends on building maritime freedom cities.

These new coastal population, technology, and logistical hubs will provide both demand and capabilities for the U.S. industrial base, deepen U.S. resilience, and complicate adversary targeting. Fortunately, this solution is emergent.

Even before the One Big Beautiful Bill’s passage, President Trump had steered the ship of state toward a mix of tariffs, tax incentives, and regulatory relief to help American manufacturers. The bill advances this agenda and includes a down payment on the Defense Department’s Golden Dome initiative to protect the homeland from Chinese missiles.

The next step is to build the freedom cities the President pitched during his last campaign to “reopen the frontier, reignite American imagination, [and provide] … a new shot at home ownership and in fact, the American dream.” In one speech, then-candidate Trump linked America’s primary geopolitical threat with deindustrialization and social malaise.

The administration is now positioned to address these interlinked challenges by designating locations on all three U.S. coasts (Atlantic, Pacific, and Gulf of America), as well as cities around the Great Lakes and its tributaries, tax-free air and maritime opportunity zones.

Each city could generate sustainable, growth-oriented demand for advanced marine vessels, many of which could support dual-use capabilities and infrastructure.

Such economic clusters would usher in an era of maritime innovation, strengthening the allied maritime industrial base.

This would bring America off the bench and provide opportunities for thoughtful integration with partners such as Japan and South Korea.

Meanwhile, representatives of hostile foreign adversaries such as China should be excluded from relevant labs and start-ups. Long-overdue investments in research security and counterintelligence must be made so that American research and development doesn’t continue to help Beijing tighten its hammerlock over global maritime trade.

Life on the water in support of hands-on industries has inherent attraction. If you build it, they will come and thereby contribute to the great rebuilding effort that the President has already begun.

To the relief and excitement of Americans—and the disappointment of our adversaries—America is poised to return to the fundamental business of industry, homeland defense, and maritime innovation.

Views expressed in this article are opinions of the author and do not necessarily reflect the views of ZeroHedge.

Tyler Durden Tue, 09/09/2025 - 21:45

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