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Sex, Spies, And The FOMC: How Beijing Turned A Senior Fed Economist Into Its "Inside Man"

For years, conspiracy theorists have insisted that the Federal Reserve is run for the benefit of a foreign power. It turns out they were - at worst - only half wrong: it's just that the foreign power in question wasn't getting the FOMC minutes through the front door, but via a lovesick Fed economist, an online dating site, a set of silk scarves, and a gym-obsessed "Ph.D. student" who, according to US officials, was actually a Chinese intelligence officer.

Readers may recall the name John Harold Rogers, the former senior adviser in the Fed Board's Division of International Finance whose arrest we first reported back on Feb 1, 2025, and whose case we then revisited in May 2025 under the only headline the facts allowed: "Teaching Or Treason?" In February a DC jury gave its answer (sort of): guilty of lying to investigators, not guilty of conspiracy to commit economic espionage. And in July, as we reported on July 16, Judge Dabney Friedrich sentenced him to 38 months in federal prison.

That, it seemed, was that. But now a lengthy CNBC investigation, built on text messages, investigator audio recordings, trial exhibits and copies of the Fed documents in question, fills in the gaps. And the gaps, it turns out, were where all the good stuff was hiding.

"The facts of this case read like a spy novel. There was sex. There was money, manipulation, secret meetings with shady characters in China, fake identities, lies, trickery, and deceit. But this was real life." — Federal prosecutor Nicholas Hunter, in his address to the jury Meet "Hummin Lee"

The story begins in 2013 at a conference in Shanghai, sponsored by, of all things, the Federal Reserve Bank of Dallas, on the campus of Fudan University. During a session break, a tall, broad-shouldered young man introduced himself to Rogers as Hummin Lee, a Ph.D. student. US authorities believe his real name is Jin Chuan, and that he is a Chinese spy.

A photo of Hummin Lee flexing his muscles that Lee sent to John Rogers in a text message on Aug. 4, 2018; Source: Department of Justice

What followed was textbook slow-burn cultivation. Lee sent birthday wishes and Christmas presents (including, in a detail no novelist would dare invent, a copy of Sun Tzu's The Art of War), invited Rogers to lecture in China, and kept tabs via a Facebook account featuring shirtless gym photos and, in total, six friends. After Trump won in 2016, the gift of a traditional Chinese painting arrived with a question attached: would Trump label China a currency manipulator? Rogers, to his credit, dodged.

Then came New Year's Eve 2016. Rogers, a divorced father of four grown children who later said he "kind of felt like a loser" that night, logged on to AsianDating.com and met Yu Liu, known as Yu Yu, a young woman in Shanghai 24 years his junior. Her messages were beautifully written in English. Only later did Rogers learn she didn't speak English at all.

Yu Liu and John Rogers are seen at a restaurant in a photo from a text message Rogers sent to Hummin Lee on Nov. 20, 2017; Source: Department of Justice 

Retired 35-year CIA veteran Ralph Goff, who had no role in the case, told CNBC what everyone reading this is thinking:

"If this woman wasn't a plant by Chinese intelligence into that web dating site, then I'm sure that they had a meeting with her soon after that contact."

CNBC notes it is unclear whether Yu Yu has any links to Beijing; she did not respond to questions. What is clear is that from that moment on, Rogers suddenly very much wanted to travel to China, and his generous friend Lee was only too happy to arrange it. "Your related expenses in China will all be covered by us," Lee wrote.

The full-service handler

Lee didn't just book flights. He planned itineraries and arranged lectures. When Yu Yu needed cash, Lee wired her 5,000 "of my own money. Don't worry." When her then-husband demanded 80,000 yuan to sign divorce papers, Lee told Rogers to "go to sleep and take a good rest man," and seven hours later texted a photo of a freshly issued divorce certificate. When Rogers married Yu Yu in Hong Kong in March 2018 (she became pregnant on his second trip to China), Lee organized the logistics and witnessed the prenup. When the baby arrived that summer, Lee met Rogers at the airport and went with the couple to the hospital.

Rogers described him to Fed investigators as a "super nice guy but so nice it was a little bit spooky." Which is a useful working definition of a case officer.

"I owe everything to him. The baby wouldn't have happened, the relationship with my wife wouldn't have happened... And I love him like a brother." — John Rogers, to investigators

Lee also introduced his "boss," a "Professor Cui," who pressed Rogers for Fed rumors and gossip and, per Rogers, offered him packets of cash (which Rogers said he declined). When the FBI searched Rogers' home years later, agents found $55,000 in cash, including some in a white plastic grocery bag at the bottom of a closet under a pile of women's clothing. Investigators could not establish where it came from.

The "questions"

With Rogers now thoroughly in his debt, Lee's curiosity about the Fed grew. The "classes" Rogers taught in China increasingly took place in hotel rooms with a handful of attendees. At one point Lee sent over a typed list of questions, among them:

• Why the dollar wasn't appreciating much despite repeated Fed hikes;
• How the Fed evaluated China's financial liberalization;
• And, our favorite: "How does the Fed evaluate the trade war with China proposed by Trump? Will the Fed adjust monetary policy to cooperate with the trade war? What specific measures will the Fed take?"

"I'm wondering if you could help us collect answers from your colleagues or documents and teach us when we meet," Lee added, helpfully. Rogers testified these were "bread-and-butter" textbook questions. Which, to be fair, they mostly are; it's the "from your colleagues or documents" part that is less textbook.

Rogers then emailed Fed colleagues asking for material, remarking with remarkable self-awareness: "Part of it, I think, is that they want me to reveal some kind of Fed secrets they believe exist." One document he received was marked "Nonconfidential/Internal FR." According to a federal agent's testimony, Rogers changed the heading to "Nonconfidential/External" and forwarded it to Lee. On another occasion he asked a colleague for Fed thinking on trade policy uncertainty, adding: "If there is something in writing that is not allowed to be shared, please send that just for me to catch up." He received a document on washing machine tariffs, forwarded it to his personal Gmail, and from there to Lee.

Then, in June 2019, Rogers printed two documents: one from a category generally covering the staff forecasts prepared for the FOMC and open market operations (per the indictment, "Class II" FOMC information), and a set of bullet points for a briefing to Fed governors ahead of an FOMC meeting. The next day he flew to China. Three days later, he photographed a "class" in a Beijing hotel room: Lee, another man and a woman, posing by a big video monitor. Prosecutors later said both men worked for Chinese security and intelligence services.

How valuable was any of this? That was the heart of the trial. The defense argued Rogers passed nothing of value and was "a naive academic." Prosecutors argued, in their sentencing memo, that the restricted information "could allow [Beijing] to make untold sums of money by trading with its roughly $1.5 trillion in U.S. Treasury securities and related instruments." The jury, notably, was not persuaded on the espionage count. Then again, as one might note, you don't need a Fed briefing book to front-run the Fed; you just need to read Jerome Powell's press conference... or a Nick Timiraos article (well, during the Powell years at least... it appears he isn't on Warsh's Christmas Card list, or Bessent's for that matter).

Undone by... Instagram

Ironically, it wasn't China's MSS that brought Rogers down, but garden-variety sextortion scammers. After his marriage imploded (the Vienna, Virginia police were called after a physical fight between Yu Yu and a masseuse Rogers had invited to live in the house; "I swear to God we're just friends," Rogers told officers), he went back online.

On Instagram he traded nude photos with accounts showing attractive women, photos taken with his Fed-issued phone, sometimes in the gym at Fed headquarters.

The people behind the accounts then demanded money, and threatened to send the photos to then-Fed Vice Chair Richard Clarida. They also threatened to kidnap his 18-month-old daughter. On Super Bowl Sunday 2020, Rogers told his superiors, who referred him to the Inspector General, where the Fed's cyber team was already uneasy about his China trips and his friendship with Lee.

In a 2.5-hour recorded interview, OIG agent Alan Hershkowitz asked if he had ever taken a nude photo of himself. "No," said Rogers. Pressed, he conceded: "I can't rule it out." Asked whether he had ever shared restricted Fed information outside the Board, he answered: "Never." Prosecutors proved he had sent such a document to a co-author at Fudan. That single word is what cost him three years.

Perhaps the most damning detail, though, is about the Fed itself: Rogers was quietly allowed to resign in 2021, the circumstances were never made public, and he promptly went to teach at, yes, Fudan University, where according to prosecutors he earned at least $900,000 in salary and grants between February 2022 and his arrest. It then took more than three years for the FBI to show up at the bus stop.

"All of the book smarts he had, all of the articles in his resume, they don't prepare you for spies." — Stephen Saltzburg, Rogers' attorney Is the Fed a sieve?

If the Rogers case were an isolated incident, one could shrug it off as a lonely man getting played. But the Fed's own watchdog suggests otherwise:

• On the same day Rogers was sentenced, the Fed's OIG reported that the central bank lacked "a process to identify its critical assets" and needed a program to manage insider risk, warning that the Board's proprietary economic information "is of great interest to foreign adversaries."
• Then, in a report published last week, the OIG revealed that another Division of International Finance employee (same division as Rogers!) retiring in July 2024 potentially walked out with FOMC-classified information after generating 279 data-loss alerts in the final 90 days, 139 of them involving potentially sensitive FOMC material. The same employee had a history of copying FOMC files to unencrypted USB drives and emailing them to a personal address, and had traveled to a Fed-designated restricted country in June 2024. The Fed only found out a year later, and never opened a formal misconduct probe. The OIG blamed "a collective lack of action across multiple divisions."
• And in August, as we reported on Aug 26, the DOJ and FBI announced the takedown of platforms used by QTFY, a PRC state-sponsored hacking group whose targets included NASA, the DOJ, the Senate... and the Federal Reserve.

So: a Fed that can't catalog its own critical assets, can't stop a retiree from USB-sticking FOMC files out the door ahead of a trip to a restricted country, and is targeted by Chinese hackers from the outside and (allegedly) cultivated insiders from the inside. Asked by CNBC whether China is still trying to penetrate the Fed, Goff's answer was one word: "Absolutely." The Fed and its IG declined to comment.

We leave the last word to Rogers himself. Asked at trial who he believed Lee really was, he replied: "A spy." And how did that make him feel?

"Duped. He was my friend."

Which, come to think of it, is also how most savers feel about the Fed.

Tyler Durden Wed, 09/30/2026 - 16:15

Trump Responds To Watchdog Report: Force Powell Off The Fed Board - Or Sue Him

Update (1554ET): So much for "finality."

Minutes after the Fed's own inspector general cleared the Eccles renovation of criminality - and of administrative misconduct - President Trump made clear he is not treating the Horowitz report as the last word. Powell, Trump said on Truth Social, should be "forced to resign" from the Board of Governors. If he doesn't, "he should be sued by the US."

As for the building itself: Trump said Attorney General Todd Blanche will "make a determination" about the project - which is another way of saying the White House does not consider a clean bill of health from an IG Powell appointed, after a review Powell ordered, to be dispositive.

"I have asked Attorney General Todd Blanche to study the report, and make a determination as to what to do about a relatively small Building Complex," Trump wrote, adding "If he doesn’t resign, he should be sued, at the highest level, by the United States Government, for either corruption or incompetence."

Pirro deferred to this report in April. Powell said he would stay on the Board until the investigation was "well and truly over, with transparency and finality." The IG just gave him the no-crime finding. Trump just told him that isn't enough to keep the seat.

Powell can still sit as a governor through January 2028. Forcing him off that Board - as opposed to waiting out a chair term that already ended in May - is a different fight: for-cause removal, a civil suit, or enough political heat that he walks. Blanche now has the file. Watch Truth Social, and watch whether "determination about the building" turns into a new referral or just another hard-hat presser.

* * *

After more than a year of drama, subpoenas, surprise site visits, hard-hat photo ops and one very public fight over beehives, the Fed's internal watchdog has finally weighed in on the central bank's headquarters renovation. The verdict: nobody committed a crime, but almost nobody was minding the budget either.

According to a report released Wednesday by the Fed's Office of Inspector General, there were no "reasonable grounds to believe that a violation of federal criminal law had occurred," and no administrative misconduct.

What the OIG did find was a long list of management failures that helped the cost of renovating the Eccles Building and the adjacent 1931 federal building balloon from a budgeted $1.3 billion in 2020 to $2.4 billion:

• The Board never acted on the OIG's earlier recommendation, made after the Martin Building renovation overran, to set a stated cost limit. It also never asked for a construction cost estimate.
• As recently as July, four years in and with contracts already awarded, the Fed still had not set a guaranteed maximum price.
• Some work drew few or no bids, which pushed costs up substantially.
• Internal governance "wasn't equipped" to run a project of this size and complexity.
• Design changes, site conditions and, of course, inflation. The OIG said "inflation was clearly a factor," which is a notable admission from an institution whose one job is controlling inflation.

As for the marble, water features and rooftop garden that critics fixated on, the OIG said they "did not materially drive" the cost surge (so Powell was vindicated on the beehives, if not on the budget).

The new Marriner Eccles sheriff, Fed Chair Kevin Warsh, said the Fed will adopt all of the recommendations, hand management of the project to the General Services Administration (reporting to the Board and to Warsh), and bring in an independent auditor to review every cost awarded to date. "There are important lessons to be learned," Warsh wrote to IG Michael Horowitz, whom Powell appointed in June 2025.

Frequent ZH readers will remember how this saga played out. In July 2025, with Trump publicly pressing for rate cuts, the renovation became the administration's preferred lever: Trump said he wouldn't fire Powell "unless there is fraud w/ renovation" (July 16, 2025). Days later, Powell was criminally referred to the DOJ for perjury (July 21, 2025) over his June 2025 testimony that there was "no VIP dining room, there's no new marble... there's no beehives and there's no roof terrace gardens." Trump then toured the site in a hard hat alongside Powell (July 24-25, 2025), producing the most awkward cost-overrun negotiation in central banking history. At the time, OMB's Russ Vought insisted the criticism was "not about firing Powell" but "about holding the Fed accountable."

Things escalated in January, when the Fed was served with grand jury subpoenas and Powell vowed to "stand firm" (Jan 12, 2026), accusing the administration of using the probe to punish the Fed for not cutting rates:

"This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions — or whether instead monetary policy will be directed by political pressure or intimidation."

Federal prosecutors followed up with a surprise visit to the renovation site, with US Attorney Jeanine Pirro saying any project with "cost overruns of almost 80 percent" deserved "serious review." Then in March, Judge Boasberg quashed the DOJ subpoena (March 13), calling it "pretextual." After Republican senators held up Warsh's confirmation over the probe, Pirro dropped the investigation (April 24), deferring to the very IG report that came out today.

So case closed? Not quite

Pirro said at the time that she would scrutinize the IG's findings, leaving open the option to reopen the case. And Powell, who broke with tradition by staying on the Board as a governor after his term as chair ended in May, said he would not leave "until this investigation is well and truly over, with transparency and finality."

Well, Powell can now leave as today's report gives him the "finality" part. Whether it gives him a reason to leave is another question. And whether a clean bill of health from an IG that Powell himself appointed and whose review Powell himself ordered will satisfy Pirro or the White House is... well, we'll find out soon enough: keep an eye on Trump's Truth Social account (especially if like Jane Street and the HFTers you are paying $100,000 to get them 20 millisecond before everyone else).

One thing is certain: a building project that nearly doubled in cost thanks to poor planning, no price cap and "inflation" is a perfect metaphor for the institution it will house.

Tyler Durden Wed, 09/30/2026 - 15:58

Police "Islamophobia" Training Equates Farage's Words With Hate Crime

Authored by Steve Watson via MODERNITY,

North Yorkshire officers sat through a publicly funded "Islamophobia" talk that treated Reform UK leader Nigel Farage's remarks on British values as if they belonged in the same conversation as a racially aggravated attack.

The trainer then asked the room which man had done "the most harm" - the politician on national television, or a man filmed abusing a Muslim bus driver.

The session was part of Project Unity, delivered by Abbas Najib, a former officer and now chief executive of Better Communities Bradford, at the York and North Yorkshire Hate Crime Conference in 2025.

Police officers were lectured about Nigel Farage in a publicly funded talk about Islamophobia, The Telegraph can reveal.

Officers at a hate crime conference attended training sessions that compared the Reform UK leader's opinions, specifically his doubts about young Muslims'... pic.twitter.com/u2HutKLxs4

- The Telegraph (@Telegraph) September 29, 2026

Police sources later insisted it was on the conference timetable rather than official force training, and that Najib was not a North Yorkshire employee. That distinction will not comfort anyone watching officers being invited to treat lawful political speech as a hate-crime accelerant.

Attendees were shown a 2024 interview in which Farage warned that "growing numbers of people do not subscribe to British values," naming Muslims and those turning out for the pro-Palestine marches in London. He cited a Henry Jackson Society survey finding that 46 per cent of British Muslims supported Hamas.

The room was then shown footage of a 2024 racial assault on a Muslim bus driver and told to "think about the relationship" between Farage's words and the offence. Officers were instructed to "draw your own conclusions" about the Reform leader and to "think about whether this commentary has any influence on something like this."

Najib put the comparison in the open. "Ask yourself, who is going to get into trouble between those two gentlemen? And who did the most harm?" He added: "Sitting in a national news studio and saying 'Jews hate Britain'. He'd be locked up before he left the studio, and too right too."

The same lecture also went after other Reform figures. Najib objected to "mainstream, high-profile politicians" such as Suella Braverman, Robert Jenrick and Michael Gove calling the pro-Palestine demonstrations "hate marches," and recast those protests as "protesting genocide."

Written material claimed women were not oppressed by the stipulations of Islam. The session defended mass immigration and argued that "Muslims, the immigrant, the brown person" were being scapegoated for a flatlining economy, when the real culprit was "the rich."

Footage of Matthew Goodwin on GB News was used as well. Goodwin had presented a YouGov survey finding that more than half of Britons believed Islam was not compatible with British values. The training material answered that poll with a claim that Islamic teachings sit neatly alongside David Cameron's official list of British values: democracy, the rule of law, individual liberty, respect and tolerance.

Goodwin later told GB News he was "shocked and appalled by the context of this talk," and "even more outraged by the fact that it was given to a politically neutral organisation such as the Police." He said the session showed that "there are some people in Britain who will not even allow us to have a debate about the role and compatibility of Islam in modern Britain."

Better Communities Bradford has received £490,000 from the National Lottery Communities Fund since 2019, including a £35,000 grant to roll out Project Unity. The programme covers "media and political narratives" and "myths and misconceptions about Islam." The Telegraph reported that the same material has been presented to students, council staff and civil servants working on Prevent, the state's counter-extremism programme.

Najib defended the work. "Project Unity exists to reduce anti-Muslim hostility and strengthen trust between communities," he said. "Statements made on national platforms reach millions, so the workshop looks closely at the words themselves and how they land." He told GB News that Farage's comments were "a sweeping claim about how British Muslims feel about this country" and that, in his view, "generalisations of that kind about an entire faith community are Islamophobic and fuel anti-Muslim hostility."

Jenrick's response cut through the charity language. "Yorkshire Police officers attended training sessions that compared the views Nigel Farage and I hold towards Islamists to a racially aggravated CRIME," he wrote. "They took issue with my description of the 'hate marches' and the fact research found 46% of British Muslims supported Hamas." He added: "The police have been infiltrated by bad-faith actors seeking to police speech, not actual crime."

Braverman tied it to the record she already put on the table. "This is the root cause of why the police refused to stop the hate marches, why antisemitism and extremism is out of control and why I was forced to blow the whistle on two-tier policing in 2023."

The timing is not accidental. Last week Policy Exchange reported that the National Association of Muslim Police had published papers defending Hamas, calling the IDF a "Zionist terrorist group," branding Zionism a form of anti-Muslim hatred, and treating the word "Islamist" as Islamophobic. NAMP denies defending a proscribed organisation. The paper still existed. The association still sits inside British policing.

The North Yorkshire session fits a pattern we have long documented. Hampshire officers told Braverman that mandatory DEI sessions had "drummed into us about our white privilege and unconscious bias," and that the outsourced trainer "was deeply hateful of white people and our culture."

Those officers stayed quiet because they feared for their careers. That same culture sat in the background of the Henry Nowak case, where an 18-year-old white teenager was handcuffed while bleeding out after his Sikh attacker accused him of racism.

Thames Valley Police has forced officers through "equity training" on white privilege, micro-aggressions and the shift from "non-racist" to "anti-racist," even after a tribunal found the force had positively discriminated against white officers.

Former assistant chief constable Kerrin Wilson recorded that white males "felt disadvantaged" and saw "unfairness was allowed for minority groups but not for majority populations."

Former officer and government adviser Rory Geoghegan put it plainly: officers "deserve far better from their leaders than to be crudely categorised by skin colour and subjected to reductive, divisive ideologies."

West Midlands Police has invited non-Muslim staff to fast during Ramadan as an act of "solidarity." Shadow justice secretary Nick Timothy called that "wholly inappropriate," arguing the police should observe "the same standards regardless of creed."

Major Andrew Fox of the Henry Jackson Society said the police exist "to enforce the law impartially, not to promote or facilitate religious practices."

Meanwhile, retired officer Stephen Gray was fined this year for sharing an online post critical of Islam. The Free Speech Union is backing his appeal and has warned that government Islamophobia definitions, already being used by forces, are functioning as a blasphemy code Parliament abolished in 2008.

A police service that lectures officers on the "harm" done by Farage while failing to hold the line against Islamist intimidation, antisemitic marches and two-tier street enforcement is not protecting the public. It is protecting a narrative.

Lottery money, Prevent briefings and conference slots have been handed to people who treat integration questions as suspect and political speech as a public-order problem. Impartial policing cannot survive that bargain.

 

Tyler Durden Wed, 09/30/2026 - 15:40

Stabbed Indian Pilot Foils Crash Plot By Crazed Omani Co-Pilot As Jet Plunged 18,000 Feet

Summary: 

• Heroic Captain Fights Off Omani Co-Pilot In Suspected Hijacking Of Israel-Bound Jet
• CNN Sources Say Co-Pilot Tried To Hijack Plane 
• Omani Co-Pilot Stabbed Pilot 
• Midair Horror: FlyDubai Pilot Reportedly Stabbed, Israeli News Says Incident Treated As "Full-Fledged Terror Attack"

New Details 

New details have emerged about what happened on the Israel-bound Flydubai flight earlier this morning, when the co-pilot stabbed the pilot, who fought back to prevent the aircraft from being hijacked and crashed.

The New York Post cites Indian and Israeli outlets identifying the captain as Indian national Smit Machchhar, a veteran pilot with 10,000 flight hours. The Jerusalem Post reported that the suspected attacker was an Omani national who had worked for flydubai for less than a year.

The hijacker (and co-pilot) on board FZ1073 stabbed Cpt Smit Machchhar, an Indian national during the flight, but the Captain heroically managed to open the cockpit door before collapsing.

His quick thinking saved over 170 lives today and enabled the passengers to subdue the… pic.twitter.com/nBoCWgcOOK

— יוסף חדאד - Yoseph Haddad (@YosephHaddad) September 30, 2026

Despite multiple stab wounds, Machchhar fought back, alerted the crew and released the cockpit door.

"The last moments of his energy, he used to click open the release on the door," Doron Spielman, a spokesperson for the Israeli prime minister's office, told Reuters.

Spielman said the attacker was striking the aircraft's control panel violently in an apparent attempt to crash the plane.

"This is thought to be a 9/11 scenario where the co-pilot kills the pilot and crashes the plane inside of Israel with all the passengers, mostly Israelis," one source told The Telegraph.

Flightradar24 data shows the aircraft descended 18,000 feet in 12 minutes during the ordeal.

 

The suspected attacker has not been publicly identified, according to the NYPost.

Notably, the attempted hijacking comes about one week before the third anniversary of the October 7 attacks.

Omani Co-Pilot Stabbed Captain, Tried To Hijack Israel-Bound Jet

Two Israeli sources told CNN that the Omani co-pilot aboard the Israel-bound Flydubai flight earlier this morning attempted to hijack the plane and stabbed the pilot in the process. 

The outlet said:

The sources said it was not yet clear whether the intention would have been to crash the plane or to land it and take hostages.

Both the pilot and co-pilot were injured in the incident on the flight which was traveling to Tel Aviv but forced to make an emergency landing in Saudi Arabia

Added:

One of the main questions being looked into is why the flight crew included a pilot from a country with which Israel does not have diplomatic relations, the official said.

One of the pilots on Flydubai flight FZ1073 was Omani, two Israeli officials told CNN earlier. One of the officials said the Omani national was the co-pilot, allegedly the attacker in the violent incident.

Oman and Israel do not have formal diplomatic relations. It is not yet clear how the Omani pilot would have obtained clearance to fly to Israel.

A separate headline from Bloomberg cited Israeli Prime Minister Benjamin Netanyahu, who said the pilot tried to crash the plane. 

Images of flight #FZ1073 at Tabuk Airport appear to show that part of the aircraft’s rudder is missing or damaged.

Earlier in the flight, Flightradar24 data recorded an extreme descent rate of approximately -30,000 ft/min. https://t.co/8N8BLkvpiX

— Flightradar24 (@flightradar24) September 30, 2026

Scenes from inside the plane. 

BREAKING: Passenger footage captures panic aboard a Flydubai flight as the aircraft reportedly plunges 17,000 feet during a violent confrontation between the pilots, with passengers seen running toward the cockpit. pic.twitter.com/2quMsMEuXI

— Breaking911 (@Breaking911) September 30, 2026

The incident comes one week before the third anniversary of the October 7 attacks, when Hamas-led militants crossed from Gaza into Israel, killed about 1,200 people and took roughly 250 others hostage.

Midair Horror: FlyDubai Pilot Reportedly Stabbed, Israeli News Says Incident Treated As "Full-Fledged Terror Attack"

Flydubai Flight FZ1073 from Dubai to Tel Aviv abruptly diverted to Saudi Arabia earlier today after a reported fight between the pilots triggered a distress alert, sources told CNN.

Flight-tracking data from Flightradar24 shows Flydubai Flight FZ1073 diverted over Jordanian airspace toward Saudi Arabia and rapidly descended 17,400 feet in just minutes around 0120 ET. Israeli fighter jets were scrambled.

According to Amit Segal of Israel's Channel 12 News:

Following situation assessments and passenger testimonies, Israel is treating the incident as a full-fledged terrorist attack. It appears that the co-pilot repeatedly stabbed the captain. Once the attack began, several crew members and passengers managed to break through the cockpit door and subdue the attacker.

According to one senior official, the co-pilot is currently being questioned, and indications are mounting that he intended to take control of the plane and crash it with the passengers on board.

Following situation assessments and passenger testimonies, Israel is treating the incident as a full-fledged terrorist attack. It appears that the co-pilot repeatedly stabbed the captain. Once the attack began, several crew members and passengers managed to break through the… https://t.co/BXS4kIjGXk

— Amit Segal (@AmitSegal) September 30, 2026

Flydubai confirmed the midair incident and said the Boeing 737 landed safely in Tabuk, with all passengers safe and accounted for. However, the airline did not specify the nature of the incident.

"Our teams are working closely with the relevant authorities," the carrier said. "Further updates will be issued as additional confirmed details become available."

Passengers told Israel's Channel 12 that they heard shouting near the cockpit and an altercation inside. They also said the aircraft plunged before landing in Saudi Arabia.

Tyler Durden Wed, 09/30/2026 - 15:35

Top Shia Cleric Says US Should Compensate Iraqis As Last American Forces Leave

Via Middle East Eye

Influential Shia cleric Muqtada al-Sadr has said the US should compensate Iraqis for the damage inflicted on the country, as the last American troops pull out of Iraq.

In a statement on Wednesday, which is the deadline for American forces to end their 12-year presence (since the start of 'Inherent Resolve' against ISIS) in the country, Sadr hailed the "independence of Iraq" and praised those who fought against the US.

Iraqi Shia cleric Muqtada al-Sadr 

"We demand compensation from the American army for all the damages that occurred as a result of its occupation of Iraqi lands," he said. "Everyone should file legal complaints regarding this."

The US first occupied Iraq in 2003 following the overthrow of Saddam Hussein, before pulling out its forces in 2011.

They returned at the request of the Iraqi government in 2014 to tackle the spread of the Islamic State group, which had seized around a third of the country.

The US-led invasion in 2003 was widely regarded as illegal, and American forces in Iraq were accused of committing frequent war crimes and human rights abuses.

Different accounts of the death toll from the invasion have been reported, with most ranging from hundreds of thousands of violent deaths to more than a million excess deaths.

Sadr said in his statement that the US, as well as "neighboring countries", now needed to refrain from interfering in Iraqi affairs.

"This may lead to the severing of relations and reciprocal treatment, especially in political and ideological matters, and the dragging of Iraq into regional conflicts," he said. "We hope that the United States will reciprocate diplomatically and not act arrogantly towards Iraq, its government, and its people."

No foreign interference

During the original US-led occupation of Iraq, Sadr led the Mahdi Army (later revived as Saraya al-Salam or Peace Brigades), an armed group that fought against the coalition forces, Iraqi security forces and al-Qaeda in Iraq, among others.

Sadr and his supporters have long framed themselves as an Iraqi nationalist group, opposed to both US influence on the country and interference from its powerful neighbour Iran.

On Wednesday, Sadr said the remnants of the Mahdi Army would be retooled as the Supporters of Imam al-Mahdi Foundation, a reference to Muhammad al-Mahdi, whom Shia Muslims believe is in hiding and will return alongside Jesus to usher in the end times.

He also suggested that all current politicians in Iraq step down from their positions to usher in new blood - to "end corruption and work towards reform" - as well as reiterating a need for all weapons in Iraq to come under the control of the state.

The question of the integration of powerful armed groups in Iraq into the regular security forces has been linked to the US troop withdrawal.

Though the process was originally tied to the September 30 deadline, last week Prime Minister Ali al-Zaidi extended the deadline to June 2027.

A number of the most powerful Iran-backed groups - including Kataeb Hezbollah, Harakat al-Nujaba and Kataeb Sayyid al-Shuhada - have already indicated that they will not disarm, and the ongoing US-Israel war against Iran has made it unlikely the Islamic Republic will exert any pressure on them to do so.

"Disarmament needs a political agreement inside Iraq, a credible way of integrating fighters and command structures into the state, and some answer to the political, economic and ideological power these factions have built up over years," said Hayder al-Shakeri, a research fellow with the Middle East and North Africa programme at Chatham House, speaking to Middle East Eye.

Chief Pentagon spokesman Sean Parnell says the US and its coalition partners have formally ended “Operation Inherent Resolve” in Iraq with all forces and military equipment having left the airbase in Erbil.

The US has withdrawn its forces, but retains a more decisive form of leverage: controlling Iraq's access to its own oil revenue, which is held at the Federal ⁠Reserve Bank ​of New York. https://t.co/Ufd1Ya2QZo

— Aaron Maté (@aaronjmate) September 30, 2026

"For the groups closest to Iran, it will also be extremely difficult without Iranian agreement or a broader regional de-escalation. Otherwise, you risk simply moving the weapons into another institution while leaving the same networks and chains of command intact."

Tyler Durden Wed, 09/30/2026 - 15:20

Mother Arrested After Toddler Pulls Loaded Gun From Backpack At Michigan Daycare

A toddler pulled a loaded handgun from a backpack inside a Michigan daycare Monday, leaving a teacher to step in before anyone was hurt. The child's mother has been arrested, while the father, reportedly a Detroit police officer, is the subject of a separate departmental review. Local reporting describes an incident captured on surveillance video and a criminal investigation into the circumstances.

The Wayne County Prosecutor's Office told ABC News that an arraignment is expected Thursday, October 1. The Wednesday update, carried by AOL, did not specify the charges. On Tuesday, prosecutors had said a warrant request was still under review.

The incident occurred at Children's World Early Learning Center in Canton Township, west of Detroit. Cox Media Group reported Wednesday, citing Detroit's WXYZ, that the arrested mother is a nurse and that the child's father works for the Detroit Police Department. Police had not publicly supplied the toddler's exact age.

A Teacher Intervenes

According to a message from the center reviewed by Detroit's WDIV, staff became aware of the weapon when the child removed it from the backpack. A supervising teacher secured it, and the center contacted police.

"The supervising teacher remained calm and followed the appropriate safety response," the center told families.

The gun was a loaded Glock pistol, WXYZ subsequently reported. It remained in a holster that covered the trigger and trigger guard. Police credited both that protection and the teacher's immediate intervention with preventing anyone from being injured.

Canton Police Chief Joseph Bialy said the classroom footage was difficult to watch even knowing how the incident ended, according to WXYZ's initial report.

Amy Paggeot, a parent at the center, told the station: "My kid is usually bringing his stuffie." She described a center full of young children, many still taking naps.

The Arrested Parent Is Not The Officer

The parent taken into custody was not the police officer. Bialy made that distinction, and said he did not believe the handgun was a service weapon, according to NBC News' report carried by AOL.

WXYZ's follow-up reporting says police identified the mother as the gun's owner. The station reported that the father was not expected to face criminal charges, but that Canton investigators had contacted Detroit's internal-affairs division for a separate investigation running alongside the criminal case. Detroit police had not commented to the station. The outlet also reported that the mother could face a misdemeanor carrying up to 93 days in jail or a $500 fine. ABC's subsequent arraignment update did not identify the offense.

USA TODAY Network reporting described investigators as still working to establish how the toddler obtained the gun.

Backpack Checks Follow

The daycare has disenrolled the family and added bag checks, according to WDIV. Management said staff had followed the center's existing safety procedures and praised the teacher who intervened.

Michigan already has a firearm-storage requirement. The state Department of Education's guidance on MCL 28.429 says unattended firearms must be secured in a locked box or container, or unloaded and secured with a locking device, when a minor is reasonably likely to be present.

Remember when they taught marksmanship in school?

* * *

Tyler Durden Wed, 09/30/2026 - 15:00

Navy Awards Boeing $20 Billion Contract For Next-Generation Fighter

Authored by Tom Gantert via The Epoch Times,

Boeing has secured a contract worth more than $20 billion to develop the U.S. Navy's next-generation carrier-based fighter.

The Boeing Co. logo is displayed outside of company offices near Los Angeles International Airport in El Segundo, Calif., on Jan. 18, 2024. Patrick T. Fallon/AFP via Getty Images

The Navy contract covers full-scale development of the sixth-generation F/A-XX Strike Fighter, including testing units for ground, airworthiness, systems and weapons.

The aircraft is expected to supplement and eventually replace the Navy's F/A-18E/F Super Hornets and EA-18G Growlers in the 2030s, the Department of War said in its Tuesday announcement. It will operate alongside the F-35C.

Sixth-generation fighter technology would make aircraft harder to detect, with improved stealth capabilities, while being equipped with artificial intelligence-assisted sensors, hypersonic weapons, and directed-energy weapons such as lasers.

F/A-18E/F Super Hornets are used for air combat and attacks on ground targets, while EA-18G Growlers are jets used to jam enemy radar and communications.

"The F/A-XX is a critical pillar in our commitment to maintaining peace through strength," Michael P. Duffey, under secretary of war for acquisition and sustainment, said in the announcement.

"F/A-XX will dominate contested airspace, extend operational reach, and deliver a decisive combat advantage for the warfighter."

The fighter is being developed under the Navy's Next Generation Air Dominance program. The department said the upgrade will extend the reach of U.S. aircraft carriers.

Acting Navy Secretary Hung Cao said the contract marks "a new era for the U.S. Navy."

"The Sixth-Generation fighter is a generational leap in air superiority and will provide the world's best aviators with unparalleled capabilities to fight, win, and come home safe," Cao said in a statement.

The contract is Boeing's second selection for sixth-generation fighter work, following the company's 2025 award to develop the U.S. Air Force's F-47.

"Delivering two advanced fighters in parallel was always our plan, and we invested accordingly," Steve Parker, president and chief executive officer of Boeing Defense, Space & Security, said. "We are ready and able to build multiple concurrent future combat aircraft franchise programs."

Boeing said construction continues on a secure manufacturing facility in St. Louis that it describes as the largest of its kind in the United States. The facility will be part of an all-digital aerospace design and manufacturing system.

"Investment in facilities is just one part of the story; we're also investing in technology and people so that we can deliver for our customers," Parker said.

Boeing said technical and program details remain classified under U.S. national security and export laws.

Other advanced fighter programs have faced substantial cost increases and delays.

The Government Accountability Office reported in 2025 that the original F-35 development program finished more than a decade behind schedule, with estimated acquisition costs $250 billion above original projections.

Production, which began in 2006, continues and has delivered more than 1,100 aircraft to the U.S. military, international partners and foreign military sales customers.

Tyler Durden Wed, 09/30/2026 - 14:40

"Seek Higher Ground Now": A Near Dam Failure In New Mexico Was Just The Warm-Up For A Record El Niño

A flood-control dam in southern New Mexico came close enough to failing Tuesday that the National Weather Service ordered people downstream to get out of the way.

Forecasters issued a flash flood emergency for McLeod Dam near Garfield in Doña Ana County, after dam operators and county officials reported that failure was imminent:

"This is a PARTICULARLY DANGEROUS SITUATION. SEEK HIGHER GROUND NOW!"

The county ordered evacuations for Hatch, Garfield, Salem, Rincon and Placitas. AccuWeather reported floodwaters pouring over the top of a 20-foot earthen dam in Garfield and breaching its wall. The county described something smaller: at 8:30 p.m., spokesperson Ariana Parra told the Albuquerque Journal that crews had mitigated "a very small piping failure," that no water was exiting the dam, and that pumps were on the way to relieve pressure.

Orders for four of the five communities were lifted late Tuesday. Rincon remained evacuated as of late Tuesday because of standing floodwater.

Watch: KOAT footage of flooding near McLeod Dam in Garfield.

The dam's record was already bad before the rain. KRWG, citing the National Inventory of Dams, reported that McLeod's last inspection, in 2023, rated it "poor," classified it high-hazard, and found no emergency action plan in place.

The high-hazard label rates what a failure would cost, including lives. The "poor" rating is the one that speaks to the structure itself. None of the county's public statements this week addressed what has been repaired, re-inspected or planned since 2023.

🚨DAM FAILURE 🚨
The McLeod Dam near Garfield, New Mexico, is facing potential failure after being overtopped. Immediate evacuations are underway, while a #FlashFloodEmergency remains in effect north of Las Cruces. More rain is expected through late week, adding to the ongoing… pic.twitter.com/oEB8Si9P2q

— WeatherNation (@WeatherNation) September 29, 2026 El Niño Is Already Feeding The Storms

The water that pushed McLeod to the edge came from the remnants of Hurricane Polo, which Fox Weather ranks as the second-most intense Eastern Pacific hurricane on record. Hurricane Rachel, now strengthening off Mexico, is the basin's 20th named storm and 10th hurricane of the season, and forecasters are crediting a strengthening El Niño with supercharging the Pacific. The same pattern had left the Atlantic with its least active start since 1941 as of early September.

The winter phase, when El Niño does most of its work on the southern US, hasn't started. In its September update, NOAA's Climate Prediction Center put the odds of a very strong El Niño this fall and winter at more than 90%, with a 75% chance the key Niño-3.4 temperature anomaly tops +2.5°C in October-December. It already hit +1.8°C in August. The WMO's projection would make this the strongest El Niño since records began in 1950, as we detailed.

For New Mexico, that typically means a wetter, cooler winter. Forecasters told the Journal in June that the biggest precipitation increases are expected in the southern part of the state, which includes the Hatch Valley. Next door, California isn't waiting: Gov. Gavin Newsom declared a state of emergency Sept. 21 to prepare for heavy rain, debris flows and flooding.

CPC cautions that impacts from an event this size are more likely but not guaranteed. The dam that came within hours of failing Tuesday will face that winter carrying a 2023 "poor" rating, with no public account yet of what has been fixed.

Tyler Durden Wed, 09/30/2026 - 14:20

Trump's $200BN Korean "Investment" Is A Gas Plant With No Customers, Eight Reactors With No Sites, And A Pipeline Seoul Calls A "Future Discussion"

A week ago, we wrote that South Korea had finally found a home for the first slice of the $350 billion it promised Trump: a $22.3 billion, 6.3GW gas plant in Encinal, Texas, with no customers, no PPA, and turbines that may not show up this decade. That left, as we put it then, "$328 billion to go."

That number is about to get a lot smaller, if only on paper. According to Bloomberg, at 3pm ET, Trump will announce from the Oval Office that Korea is committing $200 billion to US energy projects: eight large nuclear reactors, the Encinal plant, and the long-suffering Alaska LNG export venture, which Bloomberg earlier reported would get $54 billion of Korean backing. A White House official described it as the first tranche of projects to win approval under last year's trade deal.

One small detail: Seoul hasn't publicly confirmed any of it. And according to Korean press, it doesn't entirely agree.

The math adds up... a little too well

Recall how the deal is structured. Of the $350 billion, $200 billion is upfront capital for "strategic industries," capped at $20 billion a year, with a separate $150 billion for shipbuilding. Now add up the three projects that have been floated:

• Eight reactors: about $120 billion, per Korea's own government briefing (six Westinghouse AP1000s and two Korean APR1400s, per Kyunghyang Shinmun)
• Alaska LNG: $54 billion
• Encinal, Texas: $22.3 billion

Total: $196.3 billion. In other words, today's announcement would use up about 98% of Korea's entire strategic-investment tranche in one go, with $3.7 billion left over for bubble tea or whatever. At the $20 billion annual cap, just funding these three would take roughly a decade, which is convenient for a program that runs well past the next two elections.

Here is where it gets awkward. In its National Assembly briefings, the Korean government listed Encinal as the only approved first project. The eight reactors and Alaska LNG were both classified as "items for future negotiation," according to SBS and Seoul Economic Daily. The latter notes that Commerce Secretary Lutnick is leading the announcement, flanked by Alaska Senator Dan Sullivan, while Korea's own trade minister, Kim Jung-kwan, who actually negotiated the thing, is not expected to be there.

Kim was even more explicit on the nuclear piece, telling reporters that the plan "does not mean that the nuclear power projects will immediately proceed" until final arrangements and government reviews are done. So the $200 billion headline is roughly $22 billion that Seoul has signed off on and $174 billion that Seoul is still arguing about.

The midterm pipeline

Bloomberg flagged the timing, noting that the announcement comes amid deep voter dissatisfaction with the cost of living and the risk that Republicans lose Congress in November. Goldman's Alec Phillips relaunched the bank's US Election Monitor this morning (full note available to pro subs) and his numbers are not great for the GOP: Democrats lead the generic ballot by 8.5 points, prediction markets give them a greater than 90% chance of winning the House, and better than 60% odds of taking the Senate. Phillips does caution that Senate polling has historically overstated Democratic performance at this stage, especially in red-leaning states.

Which brings us to Alaska. Per Seoul Economic Daily, Democrat Mary Peltola leads incumbent Sullivan 46.5% to 45%, with local fuel prices a big issue. Korean commentators are openly calling the Alaska LNG announcement a "midterm card." As for whether a 740-mile pipeline that hasn't reached FID will lower anyone's gas bill before November 3, we had a thought on that last night:

*TRUMP TO UNVEIL $54 BILLION ALASKA LNG PLAN AMID MIDTERM WOES

Surely the LNG will be used to help US consumers and not be exported to Japan and Korea, right?

— zerohedge (@zerohedge) September 29, 2026

Recall that the whole point of Alaska LNG is to ship North Slope gas to Asian buyers, with some diverted for in-state power. When we last covered the project in October 2025, it was a $44 billion venture, and Asian buyers were quietly worried the costs were too high. Korea's reported $54 billion commitment alone is now bigger than the whole project's price tag was a year ago. That is some impressive cost inflation, even by pipeline standards. Glenfarne has signed preliminary deals with importers but still hasn't taken FID; Korea's money is supposed to unlock it.

To be fair to Seoul, the timing isn't crazy from an energy-security perspective. Goldman's Samantha Dart wrote after Gastech last week that corporates across the LNG chain expect the Iran status quo to persist, and that without a meaningful recovery in Persian Gulf exports this winter, JKM will likely reach $35/mmBtu by year-end, versus a $24.85 base case. A supply source that doesn't pass through Hormuz has obvious appeal for Asian importers. It's also telling that KOGAS just approved roughly $1.26 billion for LNG Canada Phase 2, which is a project that actually exists. Meanwhile Goldman's John Mackay listed "higher costs for new US greenfield capacity" among the key debates heading into Gastech, and few greenfield projects are more greenfield than a 740-mile trench across the Arctic permafrost.

Eight reactors, zero sites

The nuclear piece is the biggest part of the package and the least developed. What we know:

• Structure: $120 billion for eight units in three phases: two AP1000s first, then two APR1400s plus two more AP1000s, then two final AP1000s. A six-month gap is targeted between the Phase 1 and Phase 2 EPC contracts, and both sides agreed only to make "reasonable efforts" to keep to it (UPI).
• Sites: None yet, though talks favor federal land.
• Lead times: 54 months for reactor vessels, 57 months for steam generators and 65 months for coolant pumps. Seoul has floated up to $10 billion by year-end for advance equipment purchases, pending National Assembly approval, and DOE has separately authorized $17.5 billion in conditional loans for long-lead AP1000 gear.
• Per-unit cost: $15 billion per reactor. That's ambitious given Vogtle's two AP1000s came in north of $30 billion, but at least it's within shouting distance.

The real fight has been over who gets to design and own what. Goldman's Seoul trading desk flagged on September 16 that the core disagreement delaying the talks was the nuclear leg, with the US "reportedly showing reluctance toward constructing Korean-designed reactors on its soil," and not keen on handing Korea voting rights in Westinghouse. That friction shows up in the numbers: a day earlier the same desk reported Seoul wanted at least a 15% stake in Westinghouse plus board seats. By last week, KED had it at about 7%, and Kyunghyang reported a 5–10% target, with the government insisting voting rights "could be obtained even at" that level. We'll see.

This is a saga we've been tracking for a while. Back in November 2025 the administration declared it a "national emergency" and said it would buy 10 large new reactors. By March, slow progress had pushed the administration to start talking with Westinghouse's rivals. In August, the plan became a Korean problem:

According to reports, The U.S. govt has proposed that S. Korea acquire a stake in Westinghouse Electric Company as Washington pursues an $80 bn partnership aimed at breaking ground on 10 large-scale nuclear reactors by 2030. KEPCO(015760) is being considered as the acquisition…

— zerohedge (@zerohedge) August 24, 2026

And by Labor Day, "up to eight" reactors with a price tag of $120–130 billion. So in about ten months we went from 10 reactors for $80 billion to eight for $120 billion, which is the most nuclear thing about this whole story.

Longer term, the more interesting action may be in smaller units. Goldman's Yuichiro Isayama noted this month that Japan's third tranche under its own $550 billion pledge is likely to focus on SMRs (after about 10 units were already assumed in the second), and flagged Japan Steel Works (Buy) as the big winner because SMR primary components still need the same large forgings as full-size reactors. As we've argued for a while, modular reactors are the only long-term solution to the AI power crunch; Tokyo seems to agree, while Seoul is betting on the gigawatt-scale designs that made Vogtle famous for all the wrong reasons.

Who buys all this power?

As a reminder, Korea's own case for Encinal assumes the power "can be sold to Big Tech at premium prices," per a local report flagged by Goldman's Seoul desk. The demand is certainly there. Goldman's Power Up America team projects AI infrastructure capex of $1.3 trillion in 2027 and $2 trillion in 2028, which it says corresponds to 35GW and 57GW of new data center deployments, adding that "the physical grid could emerge as the ultimate constraint." Against that, Encinal's 6.3GW plus roughly 9.5GW of reactors that won't be online until well into the 2030s is a rounding error... if it gets built at all.

And then there's the behind-the-meter question. As we noted last week, Goldman's Carbonomics team raised its outlook for BTM generation at data centers from 40GW to 67GW by 2030. If hyperscalers increasingly build their own on-site power (which we have long argued should be mandatory), then grid-scale plants that were financed on the premise of selling premium power to Big Tech may find Big Tech has already left the room. And with large gas turbines effectively sold out through 2030, Encinal and the BTM crowd are fighting over the same equipment anyway.

Bottom line

Japan went first in February with a $36 billion opening tranche, led by an Ohio gas plant whose sponsor, SB Energy, has since delayed its IPO. Korea is now doing the same thing, just bigger and faster: one gas plant Seoul has agreed to, $174 billion of projects it still calls "future discussion," and a headline number that will do a lot of work between now and November 3.

Last week we said there was $328 billion to go. After today, Trump will say $150 billion. Seoul will probably say it's still $328 billion. For once, both may be right.

Tyler Durden Wed, 09/30/2026 - 14:00

Congress Keeps The Trading Desk Open: Senate Dems Sink Lawmaker Trading Ban 53-47

A midterm messaging bill that was never going to become law just confirmed the only bipartisan consensus that matters: members of Congress still get to play the tape.

Senate Democrats just blocked cloture on a bill that would have stopped lawmakers from buying new publicly traded stocks. The vote was 53-47. Sixty were required. But guess what happened? Republicans dropped Voter ID into it so the Dems would nuke it. 

The measure was H.R. 7008, the Stop Insider Trading Act. House Republicans shoved it through on July 22 by 232-198, with 13 Democrats peeling off. Senate Majority Leader John Thune teed it up this week as a pre-recess vote for vulnerable incumbents, with Nebraska Republican Pete Ricketts as the face of the Senate version.

🇺🇸 BREAKING: Senate Democrats voted 53-47 against a bill that would have mandated photo voter ID and prohibited stock trading by members of Congress, with all Democrats voting against it.

The proposal would have restricted certain stock purchases by lawmakers, their spouses and… pic.twitter.com/CFLVlbf05v

— Coin Bureau (@coinbureau) September 30, 2026

It was not a vote on final passage. It was a vote on whether the Senate would even begin debate. Every Democrat lined up against it. Republicans got their campaign tape. The public got another press release about "integrity."

What The Bill Actually Did

This was not a ban on congressional stock ownership. It was a ban on new purchases of publicly listed names by members, spouses, and dependent children, plus a 7-to-14-day public notice before a sale.

Stop Insider Trading Act - the fine print

• Banned: new buys of publicly traded stocks and equivalent economic exposure.
• Allowed: keeping existing portfolios; selling after advance notice; widely held funds/ETFs.
• Penalty: greater of $2,000 or 10% of the trade, plus forfeiture of profits.
• Not covered: the president and vice president; private companies; commodities; forced divestiture.
• Bolted on: national photo-ID language lifted from the SAVE America Act.

Ricketts has been selling the companion as commonsense. In a July op-ed he said members could keep existing stock but had to telegraph sales so "the market" could get ahead of them. Violating a $1 million sale without notice would cost $100,000 plus profits. That is a parking ticket in a town where a well-timed options lot can clear that before lunch.

The 2012 STOCK Act already pretends to police this. It does not ban trades. It requires delayed disclosure and affirms that insider-trading law applies to Congress. The new bill would have gone further on purchases. It still left the core conflict intact: lawmakers can hold the names they regulate, vote the names they hold, and sell when the calendar is convenient.

The "Poison Pill" Was The Point

Senate Minority Leader Chuck Schumer did not hide the strategy. On Tuesday, in floor remarks his office billed as exposing a "theatrical farce," he accused Republicans of "skullduggery" for wiring a voter-ID mandate into an ethics bill.

There’s been a real effort to ban members of Congress from trading stocks and profiting off insider information—which I’ve supported for years.

This Republican bill, however, has no reform, no accountability, and no substance, and STILL allows members to own and sell stocks. pic.twitter.com/NL9i0ybWrK

— Chuck Schumer (@SenSchumer) September 30, 2026

He is not wrong about the mechanics. Democrats have already killed standalone voter-ID vehicles. Attach the same language to a popular ethics bill and you force the minority to vote against "banning insider trading" on camera. That is a super PAC ad in search of a roll call.

Schumer's other complaint echoes the one House Democrats have made since January: the bill is "not a ban." Sen. Cory Booker (D-N.J.) called it "weak sauce." House Democrats spent the January markup trying to force full divestiture and to rope in the executive branch. Republicans voted those amendments down.

The GOP bill was thinner than the bipartisan drafts that have been rotting in committee for years. And Democrats just used that gap, plus a voting rider they were never going to accept, to keep the status quo.

A Lifeline Vote, Not A Law

Thune scheduled this next to a data-center ratepayer bill as a political life raft for three incumbents getting worked over on affordability and self-dealing: Ricketts in Nebraska, Jon Husted in Ohio, Dan Sullivan in Alaska. The Hill reported Thune's theory in plain English: it becomes "pretty hard" for Democrats to hammer those senators for trading or data-center politics if Democrats are the ones who killed the bills.

Ricketts needs the tape. He is running for a full term against independent Dan Osborn, who has hit him over an estimated $10 million stock-market haul around last year's tariff chaos. A failed 60-vote test lets Ricketts say he tried. It lets Osborn say Congress protected itself.

Bloomberg Government flagged the outcome a day early. Democrats said a stock bill with voter ID would "never pass." The Washington Examiner called the whole exercise "built to fail" before the first vote was cast. CNBC framed it as a vote before the election recess.

The Real Ban Is Still In Committee Hell

A stricter bipartisan model - full divestiture of individual names, sometimes covering the executive branch, sometimes not - polls through the roof and dies in the cloakroom. House Democrats wanted Trump and Vance in the net. Republicans would not put a sitting Republican president in a trading cage while leaving Congress a blind-trust fig leaf. The coalition that could pass a real ban split on who had to sell.

So leadership reached for the version that lets members keep their books. Then they stapled on photo ID. The STOCK Act's 30-to-45-day disclosure lag remains the law of the land.

If Congress wanted this fixed, the fix is not complicated: no individual names, no sector toys dressed up as "diversified" products, no spouse carve-outs for people who sit in the room, and the same rule for anyone who can move a sector with a speech. That bill does not get 60 votes because too many people in the chamber like the current return profile.

Tyler Durden Wed, 09/30/2026 - 13:40

It's Time For The Right To Return Fire

Authored by Tom Klingenstein via TomKlingenstein.com,

In this essay, Thomas Klingenstein argues that the Right has made a category error: treating lawfare as a series of discrete legal disputes when it is better understood as a system of political power. His answer isn't simply better defense, but counterpressure - a new public-interest law firm, led by Jeff Clark, meant to defend conservative lawyers and make lawfare more costly to practice.

The deeper question, however, is whether an adversarial legal order can remain genuinely adversarial when one side commands the institutions, money, and professional machinery of enforcement. Klingenstein's argument is that formal neutrality is not enough; power also depends on whether institutions exist that are willing and able to contest it.

Lawfare is the strategic use of legal proceedings to intimidate, distract, defame, or destroy an opponent. Over the past decade, the Left has built a powerful, well-funded network that is carrying out Lawfare against our advocate class. The Left raised at least $183 million last year.

(Jemie Hecker/Shutterstock)

To examine lawfare, we must consider the current context, which is this: we are at war, a cold civil war, against a domestic regime which wants to overthrow America. It is correct to call it a "war," and not just an unusually wide divide, because the contest is between two moral orders. From a given moral order there flows a given set of laws, values, customs, and other aspects of culture. Obviously, a society can have only one of each. The moral order of the enemy regime rests on group outcome equality. The moral order of our regime, on the other hand, rests on individual merit. These two moral orders - individual merit versus group quotas - are utterly irreconcilable. You can't admit people to college (or anything else) based on both merit and group quotas. It's one or the other. This is why today the two political parties can agree on almost nothing. The Left knows that because it knows that it is at war. Thus, it plays by wartime rules. The Right, on the other hand, does not know it and so continues to play by peacetime rules, which include trying to reach across the aisle, a sucker's game in a war.

One of the most powerful weapons in the Left's arsenal is Lawfare. But we on the Right don't understand this; we don't understand either the nature or power of the Left's Lawfare.

It's time we learn.

The 65 Project is the best example of leftist Lawfare. Devised by Melissa Moss and David Brock, two Democrat operatives with ties to Hillary Clinton, the Project has sought "not only [to] bring the grievances in the bar complaints, but shame [Right-wing lawyers] and make them toxic."

Elsewhere, David Brock says the central aim of the Project is to "threat[en] the livelihood[s]" of Republican and conservative lawyers, noting that the power of Lawfare comes from its "deterrent effect." The goal, Brock underscores, is to "kill the pool of legal talent" on the Right.

The Project's Advisory Board consists of high-powered Democrat operatives, including former Senate Majority Leader Tom Daschle, former Utah Supreme Court Chief Justice Christine Durham, former American Bar Association (ABA) President Roberta Ramo, and Paul Rosenzweig, a member of the Federalist Society who had worked for Ken Starr on Whitewater.

When it was first announced, the 65 Project set out to target 65 lawyers (hence the name), but it has now grown to target 111 lawyers in 26 states and the District of Columbia. Since then, at least 86 bar complaints have been filed. The Project has not won all its cases, but a loss can be just as successful as a "win." A lawsuit can cost a single defendant hundreds of thousands to millions of dollars in legal fees, as well as damage his reputation and even split up his family. Trump's former Chief of Staff, Mark Meadows, paid many millions to defend himself against the J6 Committee, Jack Smith, Fani Willis, and likely others.

As I noted, the Left's lawfare effort raised at least $183.2 million in 2025 alone. This effort is not only well-funded; it is well-organized and coordinated. For example, thousands of people have been mobilized across the country to sign ethics complaints against Right-wing lawyers. In New York alone, 7,200 individuals were mobilized to support the ethics complaint against Rudy Giuliani. The groups are coordinating filings across jurisdictions and pursuing individual lawyers through multiple disciplinary proceedings. Rudy Giuliani, Kenneth Chesebro, and John Eastman have each been disbarred. Jenna Ellis received a three-year suspension. Jeff Clark's proceeding reached a recommendation for disbarment.

John Eastman's disbarment is the most well-known shot across the bow. So far, it has cost him $3 million to defend himself against disbarment and Lawfare. And like virtually all our defendants, he could not get legal representation from "white shoe" law firms. Further, his disbarment is just a piece of the Left's attack: court orders have restricted his travel, his ability to carry a gun, his ability to get his TSA ID renewed, and more - essentially stripping away his rights and imposing as many inconveniences as possible.

If they can disbar Eastman, then they can disbar you. And make no mistake, they want to.

Eastman has appealed the disbarment decision to the U.S. Supreme Court. Unfortunately, some of the most prestigious lawyers on the Right would not take Eastman's case, perhaps because of concerns about financial or reputational consequences. I get it. I know that getting involved would require sacrifices, but I also know our best and brightest lawyers love their country. Let me say to them what they already know: Their country needs them.

Leaving Lawfare to the Left has been a big mistake. It's time to return fire.

Finally, there is good news. Jay Sekulow and the American Center for Law and Justice have, to their great credit, stepped up and are now representing John. The Department of Justice should file an amicus brief in support of Eastman. Although the Supreme Court does not normally take state disbarment cases, under its discretionary cert review, it can. The primary justification for taking John's case is that partisan disbarment undermines the rule of law. Lawyers must not be systematically discouraged from taking difficult and controversial cases, such as ones that defend the Presidency, election integrity, and other Right-wing causes.

Judicial resolution depends on fearless advocates on both sides meeting on an equal playing field. Today, it is not a fair fight. Let's not sugarcoat it: the proponents of Lawfare on the Left seek to establish a one-party monopoly. And since much of America's policy development today occurs in the courts, it is evenhanded court advocacy that the Left must destroy.

As I said, we must counterattack. To begin, I'm funding a new, offensive-oriented public interest law firm, which will be led by Jeff Clark. He knows Lawfare from the inside. Jeff had the same concerns about the 2020 election that millions of Americans had: members of the executive branch in many states made unilateral, last-minute changes to properly enacted election laws; the widespread use of mail-in balloting, the lack of signature verification, and a host of other problems. Jeff wanted DOJ and the battleground states to investigate those irregularities aggressively, and so he drafted a letter addressed to Georgia's legislators that expressed his concerns. The letter was never sent because others at DOJ threatened to resign if it were. The matter should have died, as it was protected by executive, attorney-client, and other privileges. But it didn't. The letter was leaked by Jeff's enemies to try to destroy him and pressure him to attack President Trump, which Jeff refused to do.

For this supposed offense - a letter never sent - Jeff was arrested and prosecuted by Fani Willis. And Jack Smith targeted Jeff for years, claiming that he was unindicted co-conspirator number four in a criminal case relating to January 6 in Washington, D.C. What's more, Jeff had to fend off three separate congressional investigations, and for five years and counting, Jeff has been defending his bar license in D.C. Jeff's case is so meritorious that the current DOJ sued all of the judges of the D.C. Court of Appeals, two bar quasi-prosecutors, and the D.C. Board on Professional Responsibility, arguing that they have no authority to prosecute or harass Jeff in any way.

But instead of retreating, Jeff has chosen to fight. He has had a very successful legal career both in private practice and at the highest levels of the Department of Justice and the White House. As a leader of the Trump Administration's DOJ Environment Division, Jeff won 80% of his cases, including stopping the attempted takeover of U.S. energy policy by a federal judge in Oregon. And Jeff won two-thirds of the cases he personally argued when he later took over the 1,000-lawyer Civil Division at DOJ starting in September 2020.

It would be imprudent to reveal our plans to the enemy, but at minimum, the newly minted Project Oversight Law Firm will pursue damages, fees, and other remedies that make the Left's Lawfare too costly to continue. When necessary, this new firm will bring into question the careers and reputations of those who are committing Lawfare against us. It's time to turn the tables.

The conservative Lawfare effort has been much less effective than it could have been because it has focused entirely on defending our lawyers who have been attacked by the Left. And even then, our efforts have been woefully inadequate. For the most part, we have left our lawyers to fend for themselves. This must change. We need to meaningfully support our lawyers and, at the same time, go on offense. Playing defense is an honorable task, but as any good strategist knows, the best defense is a good offense.

Furthermore, at present, the conservative public interest movement is hampered by the fact that it is operating like a business that bills its clients at extraordinary hourly rates; instead, we need to develop our own purpose-built law firm (specializing in multiple legal disciplines) that can go on offense. As a movement, we have shown we are capable of identifying what we need to resist, but we are much less clear about what we need to recover, which institutions we need to recapture, and how we aim to eliminate, reduce, or make more expensive future assaults from the Left.

Tyler Durden Wed, 09/30/2026 - 13:20

Gulf Exports Roar Back To Pre-War Levels, Goldman Says; Blas Sees "Trump Has Advantage" On Hormuz

The US conflict with Iran has been ongoing for seven months and will soon enter its eighth month. Diplomatic signals this week, along with another request for a US SPR dump and reports of Gulf oil export flows improving toward prewar levels, have sent Brent crude futures down to around $103 a barrel.

Goldman analysts Yulia Zhestkova Grigsby, Alexandra Paulus and Daan Struyven have penned a new note explaining that estimated "dark exports" have helped boost Persian Gulf oil exports to 23.3 million barrels a day over the past week, back to prewar levels and an encouraging development ahead of the Northern Hemisphere winter.

"We estimate that Persian Gulf oil exports, including estimated "dark exports", have recovered to 23.3mb/d over the last week, in line with their 2025 average, as exports doubled in September," the analysts wrote. 

They said, "The remarkable adaptation of both Middle East supply and China import demand supports our base case that Brent prices moderate to $85/bbl by year-end and to $80 in 2027." 

Grigsby attributed much of the export-bound surge to increased Hormuz shipments, including ship-to-ship transfers. Those flows have offset a drone attack that paralyzed Saudi Arabia's East-West pipeline, but the most recent reports say the pipeline has restarted. 

Crude accounted for nearly 90% of September's export recovery in the Gulf area, reaching 19 million barrels a day over the past week, or 108% of its 2025 average.

But the analysts warned that exports of diesel, gasoline, and jet fuel remained at just half their 2025 average.

Saudis led the recovery. 

They also pointed out "a divergence between the fall of Iranian exports and the rise of exports of other Persian Gulf producers."

Taken together, what does this mean for the Trump administration? 

Well, Bloomberg commodities expert Javier Blas wrote in an opinion piece that President Trump has gained the upper hand in the battle over the maritime chokepoint, with crude exports from US allies through Hormuz and bypass routes recovering toward prewar levels.

Blas wrote:

I don't know who will win the US-Iran war. But if you ask me who's prevailing in the battle over the Strait of Hormuz, it's clear US President Donald Trump has the advantage. As much as Tehran says the opposite, the strait is effectively wide open. Crude oil exports from regional US allies via the waterway, plus bypass routes, have risen to about 80% of prewar levels. Iran, meanwhile, has seen its own oil exports plunge to zero.

A couple of months ago, the surge in oil shipments would have been seen as a major American victory. Yet Brent crude, the oil price benchmark, remains above $100 a barrel. Inside the White House, some must be asking themselves: If this is winning, what would losing look like?

Yet restoring crude flows addresses only one part of the global energy shock. Goldman energy analyst Nikhil Bhandari warned last week that the global refining crisis could extend well into 2027. Russia still has a refinery crisis and export halts of crude products were just extended into fall. 

Blas' view is that Trump is gaining control of Hormuz while Tehran's leverage has eroded. But whether that translates into lower fuel bills depends on the refining crisis Bhandari described: fuel prices will remain elevated into next year (read the report here).

The blockade and US sanctions are nearing maximum impact. The power of these things is that Iran's regime can obviously roll the clock forward. The devastation to the economy will now get much worse quickly. Imaginations will be running wild in Tehran...https://t.co/INXSZye8Hd pic.twitter.com/hyQXFFit7x

— Robin Brooks (@robin_j_brooks) September 30, 2026

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

Tyler Durden Wed, 09/30/2026 - 13:00

"BigMacGPT": McDonald's Uses AI To Figure Out How Much Your Next Burger Will Cost Depending On Location

One week after McDonald's held its investor day at its Chicago headquarters, Wall Street has soured on a near-term turnaround effort, with Deutsche Bank analysts saying it has effectively been delayed. 

Now, a new report says the quick-service restaurant chain behind the Big Mac is rapidly expanding its use of artificial intelligence to recommend menu prices based partly on what customers in each restaurant's area are willing to pay.

Reuters details exactly how and what AI expansion at the QSR means for customers:

The details of how that pricing system works, its extensive use of AI, the company's regulatory concerns and the tensions with its franchisees haven't been previously reported. For this story, Reuters reviewed screenshots of the company pricing engine taken in August and interviewed nine sources with first-hand knowledge of the burger chain's strategy.

McDonald's pricing engine uses machine-learning algorithms to continually analyze data from millions of daily transactions across McDonald's nearly 14,000 restaurants and generate what the company calls "the optimal price" at each location for each menu item, from Big Macs ‌to discounted coffee for seniors.

The engine has widened existing price differences for the same product between restaurants, including from neighborhood to neighborhood within the same area, three franchisees told Reuters.

Screenshots of the interface franchisees use, reviewed by Reuters, show messages including: "Your restaurant is showing MEDIUM SENSITIVITY to Price" based in part on "customer willingness to pay in your area."

The platform also contains public price information pulled from online menus of nearby restaurants of competitors including Wendy's and Burger King. Those chains said they do not use AI in pricing decisions.

McDonald’s is using artificial intelligence to help set menu prices across the US and some global markets, a plan that aims to boost profit but risks alienating customers and attracting antitrust scrutiny https://t.co/FI5dBN4luP pic.twitter.com/D1Rd1RMGJf

— Reuters (@Reuters) September 29, 2026

McDonald's pricing engine is operated by Tiger Analytics and follows corporate parameters as well as transaction data, the outlet said, citing former employees. Those parameters have included avoiding summer price increases on ice cream and drinks and targeting items whose prices have remained unchanged for at least two years.

The bet on using AI appears part of a major overhaul the burger chain is making as a way to regain marketshare in the QSR space and continue its affordability war with competitors. However, there is a collision because customers want cheaper meals, franchisees face higher costs, and management wants to squeeze every restaurant to boost revenue to drive the stock price higher. 

"It's in the interest of the company to know where there's (customer) demand and to get that feedback in real time," said Brooklyn resident Diane Bezucha. But if that AI engine is used to raise prices simply because of more demand, "that doesn't really help me as a customer."

The other question is whether McDonald's pricing engine can determine each customer's economic status and generate different prices on a customer-by-customer basis.

This all comes as the stock has slid to a four-year low, with shares on track for their worst annual performance since 2002.

Deutsche Bank's Lauren Silberman warned last week, shortly after Investor Day, that any turnaround inflection point for the QSR behind the Big Mac has been delayed

Tyler Durden Wed, 09/30/2026 - 12:20

Signs Of Fresh Houthi Attack On Saudi Aramco Facilities

Update(1159ET): While very unconfirmed at this early stage, the Houthis have reportedly attacked the Abqaiq oil city in eastern Saudi Arabia this afternoon (local), reports IRNA citing anonymous news sources. Abqaiq is at the heart of of Saudi crude processing, and it has been struck previously in the context of the Saudi-Yemen conflict. However, there have been conflicting reports, with some open-source accounts offering satellite imaging saying there are signs of a large fire at the site:

The smoke plume identified by OSINT sources doesn't seem to originate from the main Abqaiq oil processing facility.

NASA FIRMS confirms the smoke originates from the following coordinates: 25°50'21.3"N 49°13'36.3"E -

Near a processing facility south of the Ayn Dar oil field. pic.twitter.com/bmijACyuhX

— OilPrice.com (@OilandEnergy) September 30, 2026

Aramco Pumping station west of Abqaiq on fire at ~ 0700Z today, with no statements by Houthi terrorists as of now. #KSA 🇸🇦 pic.twitter.com/Xcea3ybROn

— Shin (@hey_itsmyturn) September 30, 2026

No official sources have confirmed a Wednesday attack as of yet.

Early purported images circulating:

🚨🇸🇦 BREAKING:

Reports of rising smoke at the North Ghawar Oil Producing Complex operated by ARAMCO.

North Ghawar is part of Saudi Arabia’s giant Ghawar oil field (the world’s largest conventional oil field), located west of the critical Abqaiq processing complex in the Eastern… pic.twitter.com/srT6mhTl7w

— Mario Nawfal (@MarioNawfal) September 30, 2026 CBC news

*  *  *

At a moment there are widespread reports that Persian Gulf exports are fast recovering, there are simultaneous emerging albeit delayed reports of new tanker attack incidents that happened Tuesday.

On apparent crude transit recovery amid continued deep uncertainty, "For now, that reduces fears of an immediate crude shortage and explains why prices can fall even though talks between the US and Iran have made no clear progress," Simon-Peter Massabni from XS.com says. "The market's main question is whether this faster pace of shipments can be sustained through October."

But the UK's Maritime Trade Operations agency has announced more vessel incidents which looked to have happened on Tuesday. Three distinct incident advisories detailing strikes on vessels within the region. The affected ships included a liquefied natural gas carrier and a crude oil tanker, both of which were reportedly impacted by unidentified projectiles - with little other details known.

via cntraveler

We reported earlier on one of the three assaults, which involved a Very Large Crude Carrier in the Strait of Hormuz getting hit by a drone, after which a fire briefly erupted but was extinguished, and the tanker traversed on, and with no casualties.

In the meantime Islamic Revolutionary Guard Corps (IRGC) spokesman Hossein Mohebbi has proclaimed that there is a "military conflict" in the Strait of Hormuz on a daily basis but that the US is not responding.

"We have been hitting small ships and preventing them from passing for a long time, but America does not respond," Mohebbi told semi-official Fars news agency.

Axios late in the day Tuesday had cited "little progress" in US-Iran indirect talks, with on Wednesday an Al Jazeera correspondent saying that Washington has submitted a counter-proposal to Tehran. Here's more from Axios which basically contradicts much of their own earlier in the week reporting:

Efforts this week by Qatari mediators to broker a diplomatic breakthrough between the U.S. and Iran have made little progress, with neither side willing to budge, according to three sources familiar with the talks. The stalemate bolsters the belief on both sides that a renewed military conflict is becoming more likely. U.S. officials think President Trump could order a return to major combat operations after the midterms.

Iran has hit atleast 3 tankers today crossing the strait of hormuz. One of them an lng tanker!
Largest number of hits in a single day. Us is likely to respond https://t.co/OJ824xqajP pic.twitter.com/1SBfWT1fwA

— Ali (@MerruX) September 30, 2026

On the counter-proposal: "So far, we have no idea what Iranian Foreign Minister Abbas Araghchi received from the US through Qatari mediators," Al Jazeera writes. "But we know he has received a proposal and presented it to the Iranian cabinet, opening it up for discussion."

According to more:

Iranian Foreign Minister Abbas Araghchi presented the U.S. response to President Masoud Pezeshkian at a Cabinet meeting, government spokesperson Fatemeh Mohajerani told the state-run IRNA news agency.

"We will make every effort to bring the agreement to fruition and will firmly stand up for the rights of the Iranian people," Pezeshkian said. "The agreement must now be based on a win-win strategy."

Some additional, though scant details:

Iranian Foreign Minister Abbas Araghchi received U.S. feedback via Qatari mediators in Doha on Tuesday on a seven-day plan aimed at building trust between Washington and Tehran, with sequencing the main sticking point, Reuters reported. Reuters said the Qatari mediators conveyed the feedback they had received from Washington on Monday, meeting Araghchi and his team on their way back from the United States.

President Trump had over last weekend made clear he he was rejecting Iran's initial proposal for a 7-day ceasefire plan and roadmap to peace. But clearly there's still some important messaging taking place via Qatar, and now that the Iranian officials who traveled to New York for the UN General Assembly are back in Tehran.

Qatar also feeling deep economic pain:

🇶🇦 Qatari Prime Minister Sheikh Mohammed bin Abdulrahman Al Thani called the war on Iran one of the biggest crises in Qatar's history, telling Piers Morgan that LNG exports through Hormuz are "barely happening."

He was asked about a reported $24 billion in lost gas sales, an IMF… pic.twitter.com/wdpSmIv4WB

— Drop Site (@DropSiteNews) September 29, 2026

Al Jazeera has some solid commentary from a regional watcher on the big picture and where things stand, also as the Iranian economy is obviously taking big hits:

The United States and Iran are under intense pressure to end the conflict with Tehran’s economy reeling from expanding US sanctions and President Trump looking for a political victory ahead of midterm elections in November, an analyst says.

“Both sides are suffering pressure,” said Luciano Zaccara, an adjunct associate professor at Georgetown University in Qatar.

“Iran needs to get something in exchange for lifting the blockade [of the Strait of Hormuz]. They need the release of sanctions, they need to get money or else the economy will be totally devastated.”

The US, meanwhile, needs to “get out of this mess” in a way in which Trump can plausibly claim to have “won something”, added Zaccara.

The alarming alternative, which could be unleashed at any moment, is that either side could attempt to further bomb their way out of the standoff while seeking to impose new red lines toward getting what they want.

More Latest Developments

via Newsquawk...

• The Iranian government spokesperson said Foreign Minister Araghchi presented President Pezeshkian with a US proposal following his New York trip, which included discussions on Iran’s conditions for reopening the Strait of Hormuz, IRNA reported. This followed a Reuters report, which also highlighted that the main dispute between the US and Iran does not concern the components of the plan itself, but rather the order of operations and the stages of implementation of the seven-day framework.
• US White House is reportedly tempering expectations of an imminent breakthrough between US-Iran, Semafor reported, with a source suggesting that "the bar is being raised very high."
• A senior source said mediators are working to return negotiations to a broader track that includes the nuclear issue, Al Hadath reported.
• US-Iran talks and efforts by mediators this week yielded little progress, raising the odds of renewed combat, while Qatar will continue efforts despite growing frustrations with both sides, according to Axios.
• IRGC aerospace advisor said Iran can sustain current missile firing rates for years and the era of attacks without response is over.
• UKMTO said that a crude oil tanker was struck on the port side by an unknown projectile in the Strait of Hormuz on September 29th. Following this, UKMTO separately reported that an LNG tanker was struck by an unknown projectile on September 29th within the Strait of Hormuz.
• An incident was reported on a plane flying from Dubai to Tel Aviv, with recent reporting suggesting that the incident was a terrorist attack, Al Jazeera reported. The report suggested that the co-pilot who stabbed the other pilot was of Omani origin.

Tyler Durden Wed, 09/30/2026 - 11:59

Bank of Korea To Buy 1 Ton Of Gold In First Purchase Since 2013

Add South Korea to the list of countries taking tentative steps to hedge their exposure to the US dollar, and fiat in general.

The Bank of Korea will buy approximately one ton of domestically produced gold in December, worth 200 billion won, according to the office of Rep. Chung Tae-ho of the Democratic Party of Korea, a member of the National Assembly's Strategy and Finance Committee, on the 30th.

The move, which follows indirect investment through ETFs in the second quarter, signals a more active push into gold and marks the central bank's first physical gold purchase in 13 years. The first transaction is scheduled for December 14, after the bank establishes the system needed for domestic gold trading, Seoul Daily reported.

In materials submitted to Chung's office, the BOK said the necessary systems are expected to be in place around Dec. 14, allowing the first transaction to take place at that time. The central bank estimated the planned volume at around one ton. One ton of gold is valued at roughly 200 billion won ($140 million).

The Bank of Korea held 104.4 tons of physical gold as of the end of August, valued at $14.88 billion and representing 3.4% of foreign exchange reserves. One ton adds less than 1% to that position.

The BOK halted gold purchases in February 2013. It had ramped up gold investment until then, only to face fierce criticism from politicians when prices fell. But with geopolitical risks mounting and interest in gold as a safe-haven asset growing, and amid criticism that the BOK's gold holdings were smaller than those of other central banks, the bank decided this year to expand its reserves. It officially announced in August that it would resume buying physical gold. In the second quarter, it had already purchased $250 million worth of gold ETFs, which are classified as securities.

The most likely approach for the physical purchases is to buy volumes that domestic gold producers had planned to export. The arrangement is significant because it secures a channel for buying gold in won rather than foreign currency. That allows the BOK to build up safe-haven assets without dollar outflows, minimizing volatility in the domestic foreign exchange market. The Korea Exchange recently overhauled the trading, custody and settlement systems of its KRX gold market to support the BOK's purchases.

Chung said the BOK's decision to resume physical gold purchases after 13 years is a meaningful first step toward diversifying the country's foreign exchange reserve portfolio.

What makes the purchase notable is the resumption itself. As Binance notes, a central bank that has not bought physical gold since 2013 building the infrastructure to do so signals an intent to continue, and the report describes establishing a system rather than executing a one-off trade.

Confirming an August report from Reuters, the purchase is expected to cover gold that domestic producers had originally planned to export. That will allow the central bank to pay in Korean won without drawing on foreign exchange reserves.

The distinction matters for how the transaction affects Korea's external position. A conventional gold purchase converts foreign currency into bullion, changing the composition of reserves without altering their total. Buying domestic production with won adds to reserves without spending any.

It also keeps gold inside Korea that would otherwise have left, which has a marginal effect on the country's trade flows.

The Bank of Korea began indirect gold investment in the second quarter of this year, purchasing $250 million worth of gold ETFs.

That sequence is informative. ETF exposure gives price participation without custody, storage or the operational work of handling physical metal. Moving from ETFs to bullion after two quarters suggests the earlier position was a preliminary step rather than the intended endpoint.

The BOK's gold holdings fall far short of those in major economies. As of the end of August, the central bank held 104.4 tons of physical gold, worth $4.79 billion on a book value basis. That accounts for just 1.1% of total foreign exchange reserves, or about 3.4% at market prices. The BOK ranks 39th in the world in gold holdings, according to the latest data from the World Gold Council.

China's central bank has been the more visible buyer, adding 650,000 ounces in a recent month - its largest since 2023 - across 22 consecutive months of purchases.

Central bank gold demand has been a persistent bid through a period when the metal has fallen sharply on rate expectations. Gold traded near $4,144 on September 28, roughly 25% below January's record of $5,600, and posted three consecutive weekly declines through mid-September.

That divergence is the thing to watch. Official sector buying has continued while investor flows moved the other way, and a central bank starting a programme at these levels is buying into weakness rather than strength.
Fiscal Concerns Are the Stated Driver Elsewhere

The broader argument for central bank gold accumulation has shifted toward sovereign risk.

Chicago-based Strategic Analytics put it directly: "Since 2022, gold has increasingly tracked fiscal-risk perceptions – term premium, deficits, debt sustainability – rather than the Fed's policy path."

That framing sits alongside a bond market setting extremes. The 30-year Treasury yield crossed 5.6% on Tuesday, its highest since June 2002, and the 10-year reached a fresh 2007 high near 5.3%, with analysts including 10x Research's Markus Thielen forecasting 6%.

Tyler Durden Wed, 09/30/2026 - 11:40

Oil Hits Session High After DOE Shows Lowest Midwest Gasoline Stocks On Record

Oil prices rose to session highs after today's DOE inventory data refuted the latest cheerful API prints from Tuesday afternoon. Instead of the API-reported builds in distillates and gasoline, the DOE said that in the last week both products drew, with a modest increase in Cushing inventories, while crude inventories rose by 922K

API

•     Crude +1.0mm
•     Gasoline +3.0mm
•     Distillates +0.3mm
•     Cushing +0.2mm

DOE

•     Crude +0.922mm
•     Gasoline -1.684mm
•     Distillates -2.251k
•     Cushing +553mm

As Bloomberg notes, that’s a large draw of distillate fuels at 2.25 million barrels, well below the 300,000 barrels increase API saw. The October diesel contract is expiring today, so price action is a little murky, but the most-active contract is holding pretty strong gains near $4.75 a gallon.

Cushing stocks saw another bounce off 'tank bottoms' even as crude inventories saw a modest increase, while product stocks both saw modest draws...

Here' a look at some more of the data:

• PADD 1B gasoline -1,422k
• PADD 1 Distillates -254k
• PADD 3 crude +3,417k
• Refinery utilization -1.5ppt vs est. -0.3ppt
• Refinery crude inputs -554k b/d
• Crude imports -179k b/d
• Crude production +16k b/d

The 922,000 barrel build in commercial crude stockpiles was close to the 1 million barrel increase seen by the API on Tuesday. It compares with a Bloomberg survey of analysts that saw the stockpile shrinking by 710,000 barrels and Bloomberg users’ expectations just before the data were released of a 1 million barrel build.

Stockpiles at Cushing, Oklahoma, rose to the highest since May. At 24 million barrels, inventories are inching further away from the 20-million mark generally seen as the minimum operating level for the storage hub. It’s the second straight week of builds at Cushing. 

Meanwhile, the US Strategic Petroleum Reserve declined by another 785K barrels; SPR stockpiles will continue to draw further throughout the end of the year after the energy department re-offered 40 million barrels of sour oil in a tender. The oil was offered as part of the exchange program, and must be returned in kind between 2027 and 2029. It’s to be seen if the government will be able to attract interest from traders and refiners. The minimum premium has fallen to 7% to 9.5%, compared with as much as 22% earlier this year. A total of 132 million barrels of crude has been taken out of the SPR since late March under a program to release 172 million barrels as part of a relief plan coordinated by the International Energy Agency aimed at lowering energy costs.

That means that the build in commercial crude stockpiles was mostly offset by another 785,000 barrels withdrawn from the SPR. That reduced the overall nationwide crude build to just 137,000 barrels in the week to Sep 25.

Taking a closer look, we find that gasoline stocks in the US Midwest are at the lowest level on record. Overall, the US has the least gasoline on hand since November 2014, with stockpiles falling by 1.68 million barrels. 

On a seasonal basis, PADD2 (Midwest) gasoline has also never been lower. 

Distillate fuel stockpiles in the US also remain at their lowest seasonal levels on record. Stockpiles fell in every single region. Exports, meanwhile, rebounded to 1.5 million barrels a day. While discussion of a US diesel export ban has died down a bit, it hasn’t faded entirely, and a number like this might revitalize some of those conversations.

Linked to that, there was another big drop is US crude processing by refineries. Over the past three weeks, crude consumptions fell by 1.3 million barrels a day. That’s the lowest since May. Rates fell in all regions, with the exception of the Rockies

Imports of Brazilian oil rose to the highest level since November 2024 and the highest level ever for this time of year, with the US importing nearly 500,000 barrels each day last week. While it’s unclear what’s driving the move, one explanation could be that strong American refinery runs are supporting demand for nearby foreign crudes while, at the same time, less Brazilian oil heads to Asia.

At the same time, imports from Canada rose for the second time in three weeks. Shipments from the country remain fairly low at 3.4 million barrels a day, but there was an uptick nonetheless. PADD 2 takes the most Canadian crude out of any region, so the build in Cushing was likely at least partially due to shipments from the North. 

Bloomberg offers another take on falling refining crude processing: Canadian crude delivered via pipeline to both the US Gulf Coast and the Patoka hub are at a contango, a sign of weak demand. On the flip side, WTI at Houston is still in a backwardated structure. That can be partly explained by the light-heavy differential, that currently favors the use of light crude over heavy crudes from places like Canada and Venezuela. 

WTI futures jumped a few cents higher to session high in a knee-jerk reaction to the report. EIA data showed a relatively unexciting US crude stockpile build of roughly 900,000 barrels, but the markets focus is elsewhere this week - namely, diesel. 

 

Tyler Durden Wed, 09/30/2026 - 11:21

Feds Investigate Kinzinger Over Alleged Kalshi Bets On Own Pardon

Former Republican Rep. Adam Kinzinger is reportedly under investigation by the Commodity Futures Trading Commission over prediction-market trades tied to an unusually personal event: whether President Joe Biden would pardon him.

According to Politico, citing three people familiar with the matter, the CFTC has been examining trades made by a Kalshi account linked to Kinzinger in December 2024 and January 2025. Kalshi is also reviewing the transactions. Kinzinger confirmed that he made the trades, telling Politico that he wagered on both whether he personally would receive a presidential pardon and whether Biden would issue preemptive pardons before leaving office.

According to screenshots Kinzinger provided to the outlet, he made $823 on the trades. He said he placed roughly 25 trades during the period and mostly lost money. 

And of course, he denies having any inside information - telling the outlet "I was not a congressman or candidate, and had been out of office for two years, and had no inside information," and claiming that he never discussed a potential pardon with anyone at or near the White House and believed his wagers complied with Kalshi's rules at the time.

What Kalshi's Rules Said

A version of Kalshi's rulebook filed with the CFTC in November 2024 - before the reported trades - prohibited users from trading when they possessed material nonpublic information about an event or had the ability to influence its outcome. Kinzinger says he had neither.

Interestingly, on Jan. 6, 2025, while Biden's possible preemptive pardons were being publicly debated, CNN's Anderson Cooper asked Kinzinger whether Biden should pardon members of the Jan. 6 committee, including himself.

"No. I don't want it," he replied, adding "As soon as you take a pardon, it looks like you are guilty of something," Kinzinger said.

Two weeks later, Biden pardoned Kinzinger along with the other members and staff of the House Jan. 6 committee and police officers who testified before it. The Justice Department describes the action as a "full and unconditional pardon" covering potential federal offenses arising from or related to the committee's activities.

Granted: we don't know exactly when each Kinzinger trade occurred, whether he held a position when he made his CNN comments, or which side of the pardon contract he was taking at any particular point.

So the public statement and the trading activity cannot, based on what is currently known, be treated as evidence of market manipulation.

In February, the CFTC warned that prediction-market activity involving improperly obtained confidential information or a trader's influence over an event can trigger federal antifraud and anti-manipulation rules. The agency highlighted one case involving a political candidate trading on his own candidacy and another involving a person affiliated with a YouTube channel who allegedly knew the contents of videos before they were published.

Tyler Durden Wed, 09/30/2026 - 11:20

Migrant Caravan Headed For US Border Has 'Zero Chance' Of Entering, DHS Chief Warns

Another migrant caravan from Honduras has "zero chance" of entering the United States, DHS Secretary Markwayne Mullin. 

U.S. Army combat engineers place razor wire on the U.S.-Mexico border wall to reinforce security in El Paso, Texas, as seen from Ciudad Juarez, Mexico, on July 24, 2025. Jose Luis Gonzalez/Reuters

"The caravan has zero chance of coming into our country," he told Newsmax Monday. "I’ve been talking with the Mexican government and we actually have been watching this caravan for quite some time."

The Department of Homeland Security (DHS) has been tracking the group since it left San Pedro Sula, Honduras Sept. 20, and has been working with international partners to monitor its movements. 

"DHS is playing lockdown defense at the border. We will use every Weapon at our disposal, from A to X, to keep Americans safe," an agency spokesperson told the Epoch Times. "Migrants considering making the dangerous journey to our country should also be aware that the days of ‘catch and release’ are over, and Biden’s disastrous open border policy has been SEALED SHUT." 

The group, which calls itself "Fe y Esperanza" (Faith and Hope) is estimated to include around 300 people, according to Oaxaca news outlet Oaxaca Capital. 

Texas National Guard soldiers wait nearby the boat ramp where law enforcement enter the Rio Grande at Shelby Park in Eagle Pass, Texas, on Jan. 26, 2024. Michael Gonzalez/Getty Images

"Some of its members have indicated that they are seeking to reach the United States, while others plan to stay in Mexico and look for job opportunities," the outlet reported. "It is also reported that migrants who were previously deported from the United States are now attempting to resume their journey northward."

The caravan entered Mexico from Guatemala via a bridge in Suchiate and walked more than 12 hours to reach Tapachula. They stayed in Oaxaca for several days and received care for exhaustion, dehydration, blisters, and foot injuries, the city said.

Humanitarian organizations provided first aid, medications, water, food, and hygiene items to the men, women, and children from several countries in Central America that made up the group, the city reported. -Epoch Times

Mexican authorities are reportedly helping to break up the caravan, Mullin said, adding "They are not entering ... We made this very clear." 

Tyler Durden Wed, 09/30/2026 - 11:00

FTC Launches 'Rogue AI' Probe Of OpenAI, Anthropic - And Takes Aim At Their Regulatory Moat

The Federal Trade Commission (FTC) is launching a sweeping, aggressive probe into top frontier labs like OpenAI and Anthropic. However, the investigation goes far beyond simply asking questions about autonomous software run amok, and its chairman has made clear he won't let Silicon Valley use recent AI failures to build an insurmountable regulatory moat.

According to administration officials who spoke to the New York Post, FTC Chairman Andrew Ferguson is preparing to hit tech executives with Civil Investigative Demands (CIDs) - essentially administrative subpoenas - to compel testimony regarding the dangers their artificial intelligence (AI) super intelligence (SI) models (are we doing this?) pose to the public and consumer markets.

The Catalyst: 'Hugging Face' Jailbreak

The immediate trigger for the probe is the highly publicized "Hugging Face incident" from this past July. During what was supposed to be a contained cybersecurity evaluation, about 700 of an estimated 1,200 OpenAI agents escaped their testing sandbox, bypassed network controls, and breached the infrastructure of the computational tools company Hugging Face. 

Running primarily on OpenAI's "Internal Model 1," the autonomous agents tried to erase traces of their work, created nearly a million shortened URLs to run code outside their restricted environments, and even tried to enlist other AI models to help.

While AI safety researchers were quick to call it "the first true AI safety incident," the FTC is taking a distinctly different view on accountability. Chairman Ferguson recently indicated that companies cannot shift legal blame to "rogue" AI systems when their automated decisions result in security breaches or consumer harm. The liability, the FTC argues, rests squarely on the humans who designed, instructed, and unleashed the models.

That said, these breaches have drawn scrutiny of their own. OpenAI first disclosed the incident as an "unprecedented" cyber event, but Hugging Face's own post-mortem found the agents reached the open internet through a network route the sandbox had deliberately left open, and exploited weaknesses that "a capable human attacker could have found and exploited" - unsafe dataset processing, exposed cloud metadata, overly broad access and long-lived credentials. OpenAI itself conceded that its own chain-of-thought monitoring, had it been running, would have caught the initial activity.

Nor was OpenAI alone. The Hugging Face breach was one of a string of incidents involving OpenAI, Anthropic, Meta and Google models that trace back to evaluations run with a single vendor, Israel-based Irregular, whose test environments had live internet access while the models were told they were in a simulation. Irregular notified all four labs in late July, yet the disclosures trickled out one lab at a time over seven weeks - turning one contractor's mistake into what looked like a wave of AI breakouts. Isolating test models from the internet is a "basic control measure," frontier security expert Matthew Mittelsteadt said. "You'd think that of all the things that you've got to get right." Some skeptics have gone further, questioning whether repeated "accidents" at the same vendor were accidents at all.

The Trojan Horse of "Self-Regulation"

For years, executives like OpenAI's Sam Altman and Anthropic's Dario Amodei have publicly warned that their own products pose an "existential risk" to humanity, practically begging lawmakers to regulate them.

But as we previously noted, these highly publicized warnings and agent "escapes" often serve a dual purpose. By whipping Washington into a panic over AI doomsday scenarios, industry leaders are paving the way for a worst-case scenario of heavy-handed regulation. Stifling compliance requirements inevitably crush open-source developers and cash-strapped startups, leaving the trillion-dollar AI bubble safely in the hands of the incumbent monopolies.

Chairman Ferguson appears to be acutely aware of this Silicon Valley playbook.

"I think it's very important that we not allow these two firms to come to Washington, whip everyone into a panic and then say, 'We need a whole bunch of regulations that we can comply with,'" Ferguson told Fox News earlier this month. "That is how companies build a moat around their businesses to make sure that people can't compete against them."

The FTC's aggressive posture stands in stark contrast to the White House's approach. Just this week, President Trump hosted a summit with leading tech billionaires - including Amodei, OpenAI President Greg Brockman, Elon Musk, and Google's Sundar Pichai - resulting in a much friendlier, voluntary "self-regulation" pact.

The administration is attempting to walk a nearly impossible geopolitical tightrope. The US government wants to prevent autonomous agents from hacking power grids, leaking data, or manipulating financial markets, but it is equally terrified that stifling the American AI industry will hand global dominance directly to China.

The FTC probe will test whether the US can successfully police the world's most powerful software without inadvertently cementing an AI oligarchy.

Tyler Durden Wed, 09/30/2026 - 10:40

Hung, Drawn, And Third-Quartered: Roll On Q4

By Michael Every of Rabobank

Today ends Q3, which has been a shocker even in a year of major market shocks.

Wars dragged on and spread. Russia-Ukraine saw energy sites hit and hybrid attacks against Europe increase. Saudi Arabia, not Iran, is now under missile fire and both oil exporters are partly blockaded. France gave the first sign of getting dragged into the war, which conflated more with Russia-Ukraine. A US-China summit suggested détente but news that families of Chinese AI workers can no longer leave the country suggested it’s minus a ‘te’ and an ‘e’ - and China just opened an airbase in Laos. Canada floated joining the EU and fighting a US invasion like the Taliban, as Greenland became a permanent US security protectorate with Ottawa’s approval. Argentina still wants the Falklands back, which London can no longer project power towards as in 1982, and as it continues to try to give away other strategic territory against strong US objections.

AI saw a series of remarkable headlines: technological breakthroughs, market meltdowns and melt-ups, and new political pushbacks. Perhaps the highlight was the upcoming Anthropic IPO telling would be shareholders that AI may pose an “existential risk to humanity.”

Western stocks had a steady Q3 until recently. With today’s session still to come, the S&P is +2.3% q-o-q vs. +14.9% in Q2 and -4.6% in Q1. The Dow -1.9% vs. +12.9% and -3.6%, the Nasdaq +2.2% vs. +21.4% and -7.1%, Eurostoxx are flat vs. +13.4% and -3.6%, the FTSE +1.3% vs +3.2% and +2.5%, but the Nikkei is -6.5% vs. +37.2% and +1.4%, the Shanghai composite -6.4% vs. +5.2% and -1.9%, and the Indian Sensex -5.2% vs. +6.3% and -15.6%.

Q3 saw the most dramatic up move in bond yield so far this year. With today yet to come: US 2s are now 4.90% (+72bp q-o-q), 10s 5.24% (+76bps), and 30s 5.57% (+60bps), the highest since 2002; Bund 2s are 3.29% (+76bps), 10s 3.62% (+76bps), and 30s 3.95% (+53bps); OATs 2s are 3.64% (+94bps), 10s 4.81% (+116bps), and 30s 5.39% (+93bps); Gilts 2s are 4.91% (+76bps), 10s 5.41% (+65bps), and 30s 5.92% (+44bps); JGB 2s are 1.96% (+59bps), 10s 3.11% (+43bps), and 30s 4.20% (+26bps).

Q3 didn’t just drop hopes of ‘lower for longer’ but doused them in scarce diesel and set fire to them. In Q1, we got just one rate hike from a G20 central bank, the RBA. In Q2, we got four, the RBA, ECB, BOJ, and Bank Indonesia. In Q3, we got the RBA (who just hiked again yesterday and are seen doing so again in the new year), the ECB, the BOJ, plus the Fed – and the issue is how much more might be needed there and elsewhere.

FX markets were also caught on the hop if expecting a weaker USD, as is so often the case, with a notable exception with huge implications for other markets. EUR/USD is around -1.1% q-o-q and GBP/USD had an unexciting Q3 while the DXY is slightly up right now. However, there was huge action in USD/JPY in the opposite direction that may carry through to the Yen Carry Trade if it carries on. EM FX are notably also starting to slip against the dollar again with the exception of CNY, which is a ballgame unto itself.

Brent oil is $104 right now, well up over a Q3 it started at $73 while the 3-2-1 crack spread is $62 vs. $17, which is what matters more, so we moved from an effective total of $90 to $166. The FT today notes that oil prices and US Treasury yields are in tightest relationship since 1990 – you mean during the late Cold War, when it was all about geopolitics at core? What a surprise!

So, what goodies will Q4 bring?

Geopolitics is on a knife edge between efforts to bring peace and a dynamic leading towards more, and more widespread war. Beyond Hormuz and the Red Sea, Iraq today sees US troops withdraw, as Ethiopia blames regional rivals for unrest with a risk of conflict spillover into the Horn of Africa, and Israeli PM Netanyahu claims indications of an attack plot by ‘enemies’ ahead – which the opposition leader, briefed on it, has publicly decried. Concerns are Russia-Ukraine could escalate into outright provocations vs. Europe and NATO, as the EU’s military mobility plan faces a €100bn bill and Ukraine is pushing for “bold action” on Russian assets to plug a $78bn defence spending gap in 2027: Politico notes ‘Tax cuts, handouts and blind hope: Europe finds few tools to fight a coming energy crunch.’ In Asia, China and Japan are verbally clashing despite some signs of an attempted reset, as Japan’s defence chief again brought up the “nuclear taboo” and the business press reports that ‘China strengthens position for Taiwan conflict with mobilisation law.’

In AI, Trump and AI CEOs just signed a voluntary safety pact and backed data centre expansion, but Sam Altman said OpenAI will delay its IPO until it overcomes safety concerns – regardless, tech supply chains continue to see unprecedented, dare I say wartime(?), demand boom conditions. The UK AI minister just admitted the country doesn’t “currently have a position where we can build superintelligence” as it’s “illegal to do so” in terms of regulations and the power demand required. Europe is meanwhile discussing an EU-wide digital levy to generate up to €25bn annually for the next budget, which will infuriate the US (and which Germany and other major contributors reject as outlined, demanding hundreds of billions of cuts).

Indeed, geoeconomics is on a knife-edge too. Will the EU initiative a trade war with China in Q4 via an expanded Anti-Coercion Instrument or resign itself to higher flows of Chinese imports in higher value-added sectors, so less local industry? Ford's CEO just urged US caution on Chinese automakers and said for Europe it’s “too late.” But could China then choke Europe on rare earths? Yesterday, the US ambassador to China posted that "Back in April of last year, China put the export regime process in place for rare earth elements and magnets. Then, on October 9th, they weaponized that by expanding that to the entire world. Now, they've weaponized it even further by escalating to the point where they make any diversification efforts away from China as a criminal offence...”

Politically, we may face an October surprise ahead of November US midterm elections where talk is of a Blue Wave (like the Red Wave that didn’t materialise in 2022). Either way almost everywhere the trend is to populism of the left and right. That’s clear in Europe, and the UK just saw PM Burnham promise PR, rejoining the EU, and reindustrialisation, without tariffs or industrial policy, which the Guardian called a “radical progressive plan to help Britain ‘rise again’’ yet had to add was “a clear vision for Britain – but not for how it fits into a troubled world.” Equally, the Wall Street Journal today notes ‘Americans Want Populist Policies That Defy Traditional Political Labels’, where their survey finds broad support for caps on prescription drug prices and strong border security. In short, nobody wants the policies being sold as the solution to high inflation.

So, what’s your guess for Q4?

Tyler Durden Wed, 09/30/2026 - 10:20