***** denotes well-worth reading in full at source (even if excerpted extensively here)
Economic Fare:
Philip Pilkington argues that the economic system which pegged global currencies to the dollar could be collapsing, but this could also be an opportunity to bring back American jobs and industry.
The financial markets are currently in turmoil. The impact has yet to hit the stock market, but bond markets all over the world are creaking. The problems seem to have started in Japan where the country’s currency, the yen, is in free-fall. So far interventions by both the Japanese and American governments appear unable to stem the bleeding. Japan sneezed and the whole world caught a cold. Bond yields across the West are rising rapidly and many analysts are bracing for a major market event.
If this comes to pass, in the coming weeks and months many will focus on the short-term drivers of these problems. But in reality, they are the culmination of decades of poor economic management. To understand this a little history is needed. ...............
Money quote: (hat tip: naked capitalism)
“From the perspective of the cross section of countries holding dollar assets, the dollar’s status in official portfolios is largely intact.”
Dowd: Bessent Intervenes In The Long-end US Treasury Market: Lower Yields Are Coming…Nobody Will Like Why
Growth Scare Incoming
.................. Who is actually in charge of the long end of the yield curve? It is not the Fed. It is not Scott Bessent’s operations desk. It is priced by growth expectations and inflation expectations or said differently the boom/bust cycle. Who is in charge of that? The laws of nature and God.
Bessent will get lower long end yields eventually, however he won’t like the reasons why. That is not a shot at the man. It is a description of the cycle. You can rearrange the maturity mix. You can jawbone fiscal consolidation. You can tell reporters that yields do not reflect fundamentals. None of that overrides a growth scare once the growth scare arrives. That reality is not what Bessent or Trump want to manifest especially before the midterm elections. Look at China if you want the preview: bond yields collapsing because the economy is in a disinflationary grind, not because Beijing discovered a clever buyback program. ..............
.............. Put those three looming risks on the table at the same time and Bessent will get lower long-end US yields. This is currently not consensus thinking but as the risks manifest themselves and the business cycle exerts its natural downturn the narrative will quickly change. The US long bond is the scoreboard and we believe soon it will begin to respond to these headwinds as we roll through the rest of the year and into the next. In hindsight the current Bessent intervention will be seen as ironic.
The Treasury is not the Fed. The Fed is not the long end. The long end is the cycle.
The signs are not hiding. They are just inconvenient for the people who need the narratives to keep the party going.
Conway: This isn’t just about Jaguar Land Rover (or VW)
It’s about the fact that nearly nine tenths of a car is not made by the company whose badge goes on the front. We need to start talking about the other 9/10s of the car industry
....................... Last week Volkswagen announced 50,000 job cuts; today Jaguar Land Rover announced 4,000.
The key thing you need to know about these numbers is that they drastically understate the eventual impact of what’s happening here, which brings us to one of the main points I cover in Trade World. Over the course of the past century, the nature of the motor industry has shifted dramatically. This isn’t (just) a story of electric vehicles. This is about the fact that the amount of embedded value inside a finished motor car increasingly comes not from the OEM whose badge goes on the car but from a suite of component manufacturers providing assemblies that VW, JLR and the rest then bolt together in their plants. This is highly relevant today for two reasons. ............
Market Fare:
The efficient frontier should be a well-defined curve when we have uncorrelated or negatively correlated assets such as stocks and bonds for the period 1986-2020, yet in the more recent post-pandemic period, it looks almost like a straight line. Investors have less risk as you move away from 100% stocks, but it is at the expense of return. Give up return by giving up risk in a nice linear fashion. Bonds have not been a good investment, and the spread between stocks and bonds is at an all-time high. One could argue that this is not the time to increase stock exposure, but it is clear that those who followed the simple stock-bond allocation mix would have been disadvantaged.
The textbook trade-offs that we would like to see do not usually exist over short but meaningful time periods.
Bullish case gets the benefit of the doubt, but potential risks are accumulating
If we are going by checklists, there is on doubt the bull market remains intact. Five of our six indicators continue to demonstrate bull market behavior. While breadth indicators have been less than robust (more on this in a moment), price trends point to higher stock prices in the US and around the world.
.......... When new highs outnumber new lows and/or when fear is present, stocks tend to do well. Right now (as of Friday), there is no fear and the trend in new highs vs new lows has turned lower. That is a recipe for weakness from a tactical perspective.
Summary: The weight of the evidence still indicates that the primary trend remains firmly higher. But it also points to a pickup in vol and downside risk in the coming weeks as we enter a buyback blackout window during the market’s worst two-week seasonal stretch, while breadth has begun to roll over. We are not calling for a major selloff, but we do believe a 3–5% pullback over the coming month is likely. That would give an otherwise listless market renewed fuel for the next leg higher into the midterms.
Agriculture remains our focus. This El Niño is arriving faster than almost all comparable events on record, while global temperatures continue to provide a strong 12-month lead on food prices. The Bloomberg Agriculture Index posted a strong monthly close in August, and history suggests this trend may only be getting started. Finally, we lay out the long setup in Brent crude. ...........
Summary: The weight of the evidence still says the pain trade remains higher. But we’re still in in a period of weak seasonality and have some big data prints this week which could move things, in one direction or another. Breadth continues to weaken and SPX 6-month realized correlation is at a level hit only twice in the last 25 years. ..........
We remain constructive on US equities. But the setup that carried the market through August is changing, and the near-term asymmetry has shifted.
I have remained constructive through the summer, and much of that view has played out. Earnings were exceptional. The July reset cleaned up leverage and positioning. Retail returned. Volatility collapsed. Systematic investors rebuilt exposure, and equities recovered. ................
September presents a different setup.
The earnings tailwind is largely behind us just as the calendar turns decisively back toward macro. Retail and corporate demand remain supportive, but both historically fade through September. Much of the systematic capacity created by the July reset has already been redeployed. Volatility has compressed substantially. Downside protection is inexpensive. And we are entering the weakest seasonal window of the year.
This is not a change in our longer-term constructive equity view. It is a change in the near-term risk/reward.
The question I keep coming back to is simple: what is the next catalyst that pushes equities meaningfully higher from here? A few weeks ago, the answer was easier.
For the first time since the July reset, I would rather use strength to reduce some exposure and add inexpensive protection than chase the market higher into this event window. I view September as a tactical downside window, not the beginning of a broader bearish turn. .................
................... A Bloomberg index of global bond yields just rose to the highest since 2007, and is just 1% away from the highest levels this century. ....
Appropriately, the topic of soaring bond yields is also the kick-off theme of the latest weekly Flow Show (available to pro subs) from BofA's Michael Hartnett, who writes that with a 99% probability the ECB hikes Sept 10th, 53% Fed hikes on 16th, 98% BoJ hikes 18th (per Bloomberg futures pricing), the hikes are coming fast and furious as central banks try to restore credibility to ward off surge in bond yields (which, as we have discussed extensively, is now the biggest threat to AI capex and the K-shaped consumer booms). In light of this, Hartnett says that if the Fed does hike despite stalled payrolls ....
... then it will restore credibility and make sure the current "peak yields" don't go higher, it's also why to Hartnett, duration (RTY, XBI, KRE, REIT) keeps working despite surging yields and why "nouveau-leveraged" Mag7s are on the cusp of upside breakout. On the other hand, if the Fed does not hike - as Trump made painfully clear he will not approve - or even merely keeps rates on hold, then all bets are off, as is the Fed's credibility because for all his rhetoric, Warsh will prove to be "just one more of the guys."
.................. Stay long commodities and gold. With "whatever-it-takes" fiscal intervention holding down long-end yields, Hartnett has kept commodities and gold as the core inflation/geopolitical hedge. ................
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.................. Putting all this together, Hartnett says a Democrat sweep = big risk-off: it would lead to a slump in i) stocks (more than 10%), ii) the dollar, and iii) bond yields into year-end,
............. Finally, the largely priced-in scenario of a “GOP Senate/ DEM House” translates into more of the same: modest risk-on... “gridlock = goldilocks”.
................. There is also some positive news that has supported higher yields. Global growth has held up better than most expected since the conflict with Iran began. US nominal GDP growth in the second quarter was 6.6 per cent year on year, which, outside the Covid-19 bounceback period, was the highest level since 2005. Clearly, part of this reflects higher energy prices and inflation, but there is no doubt that real growth is also holding up, partly thanks to the continuing AI boom.
............ The big shift, though, is that the equilibrium rate for bond yields is higher than markets became accustomed to in the ultra-loose era.
This has raised understandable concern, but one thing has been under-reported: returns for investors are starting to stabilise and, in many cases, have been positive over recent months and years.
This has been a welcome change from the early 2020s, when low starting yields offered no protection from the bear market. Rolling five- and 10-year total returns are still around their lowest on record across many government bond markets. However, the worst of the negative-return period is probably behind us.
Over the past year, the Bloomberg US Treasury Total Return index delivered a positive return even as 10-year yields rose by about 0.60 percentage points.
......... This does not mean the secular adjustment is complete. Outside of a material downgrade to growth expectations or an external shock, the forces encouraging yields to move upwards are unlikely to disappear, but at least we’re in the ballpark of normal again.
........ After years in which returns depended heavily on capital gains, more normal levels of yields are again providing income that can compound over time, which is helping to cushion volatility and steadily reward patience. The pressures will remain, and it’s hard to see spectacular returns, especially in real terms, but at least bonds have become bonds again, and investors should bear this in mind when the next inevitable bad headline comes through.
Metal Fare:
........... The industrial metal, critical for AI and power grid buildouts, has climbed 17% this year and 47% over the past 12 months, according to Bloomberg data.
The flagship article of the commodity supercycle, in three metals
Energy · Gold · Copper
THE ARGUMENT IN BRIEF
→ One turn, struck in one panic. On 20 April 2020, oil went negative and the 39-year bond bull touched its floor in the same spring. Two generational lows at once — the hinge from a commodity-consuming world to a commodity-producing one.
→ Three metals, one regime. Gold is the memory (trust and the central-bank bid). Energy is the discipline (an industry purified by an extinction event and a decade of ESG capital-starvation). Copper is the arithmetic (a deficit that widens every year to 2040). Each tells the same supply-demand story in its own voice.
→ It sits inside a 30-year clock. Equities, bonds and commodities turn together, and the turns are linked. A commodity bull is inflationary — bearish bonds, and sooner or later the thing that ends every equity bull. We are early-to-middle innings of the up-leg toward ~2038–2040.
→ The tape has already moved. Gold, energy and copper each broke out of a base that held for half a generation. Copper miners cleared a fifteen-year relative downtrend versus the S&P 500. This is no longer a chart you watch.
→ How to own it. The ETFs for each metal, then the fifteen names — five gold miners, three energy majors, seven copper stocks — with scores, the valuation trap, and where we do and do not own them today. .........................
.............................. Gold moves in cycles — and the oldest cycle story ever written is about exactly that. In Genesis 41, Pharaoh dreams of seven fat cows devoured by seven lean ones; Joseph reads it as seven years of plenty, then seven of famine. Store grain in the fat years; survive the thin ones. Four thousand years later, that is still gold’s whole job — the store you build for the lean years you cannot yet see.
Why now?
The buyer changed: central banks, led by China and the emerging markets, are rotating reserves out of US Treasuries into metal.
..................... Most metals are stories. Copper is a bill. It does not do stories — it does arithmetic. You need a certain number of tonnes to wire a house, turn a motor, string a grid, cool a data centre. That number is going up, hard. The number of tonnes the world can produce is not keeping pace. The gap is the entire investment case. .....................
Bubble Fare:
.................................................. The chart below offers an updated view of what a lopsided economic equilibrium looks like. The line at top is shows the surplus of the corporate sector: corporate earnings less net business investment. Given that 87% of corporate equities are held by the wealthiest 10% of the economy, I’ve left dividends in this line. In a real sense, it’s a proxy for how the wealthiest Americans are doing. The red line at bottom is the mirror image, aside from a few minor elements (FRED only allows 15 data series), and shows the combined deficit of U.S. households, government, and foreign trading partners. Since foreign trading partners actually run a moderate net surplus, the spread between strictly domestic sectors is even more extreme.
Seeing that the unprecedented prosperity of corporations as a share of GDP is the mirror image of unprecedented shortfalls and lack in other sectors of the economy, we may get an insight into the sustainability of current record profit margins. That doesn’t mean that margins need to normalize in the next few years, or even in the next decade. Yet because stocks are claims to corporate cash flows that extend into the indefinite future, we find across history that the most reliable valuation measures – those best correlated with actual subsequent S&P 500 total returns – are based on revenues or margin-adjusted earnings, rather than current or year-ahead earnings, which quietly assume that the profit margins of the moment will be permanent.
The chart below shows our most reliable gauge of market valuations in data since 1928: the ratio of nonfinancial market capitalization to gross value-added (MarketCap/GVA). Gross value-added is the sum of corporate revenues generated incrementally at each stage of production, so MarketCap/GVA might be reasonably be viewed as an economy-wide, apples-to-apples price/revenue multiple for U.S. nonfinancial corporations.
The recent record peak in mid-August was 4.3, exceeding both the 1929 and 2000 extremes, and about four times the historical norm we associate with average subsequent 10-12 year S&P 500 total returns of about 10% annually, in market cycles since 1928.
Our discipline has no requirement at all that valuations must revert to their historical norms, but because they have done so over the completion of most market cycles in history, it’s best to allow for that possibility – which currently implies potential downside risk on the order of 50-75% from current levels – even if we have zero intent of treating it as a forecast. Our (uncomfortably correct) market risk estimates from the 2000 and 2007 peaks (including an 83% loss estimate for tech stocks) were based on similar considerations. If you look deeply into a speculative bubble, you can already see the collapse. If you look deeply into a market collapse, you can already see the bull market. The road up and the road down are the very same road.
Assuming one takes current record profit margins at face value, relying on them to be permanent, the forward price-to-operating-earnings P/E for the S&P 500 is at levels historically associated with subsequent 10-12 year total returns in the low single digits. Still, investors can take current forward P/E multiples at face value only by straining credibility and dispensing with history.
The most aggressive compromise, in my view, is to assume that the average margins of the past decade will be permanent. I don’t actually recommend that compromise, but we can “fix” the largest outliers of recent years by adjusting MarketCap/GVA by the 10-year average nonfinancial profit margin, which gives us a MarketCap/GVA version of Robert Shiller’s Cyclically Adjusted P/E (CAPE).
The chart below shows the mapping between this adjusted measure, which I’ve dubbed GVA_PE10, and actual subsequent S&P 500 12-year average annual nominal total returns. The recent record high was 26, while the historical norm associated with subsequent 10% annual S&P 500 returns is less than 11. That comparison gives us a narrower baseline market risk estimate of a potential 58% loss from current levels over the completion of this market cycle.
.............. The equilibrium between deficits and surpluses tells us a great deal about how the spike in investment spending on AI capacity has affected corporate profits. Notice that if the deficits of households and government, as a share of GDP, match historic extremes without breaking to fresh lows, the surplus of corporations (profits minus net investment), as a share of GDP, will also match historic extremes without breaking to fresh highs. This will be true even if corporations have embarked on an aggressive investment boom.
How can corporate profits – investment remain steady if investment is booming? What happens, in this case, is that corporate profits must expand to the same extent as the amount of investment. Some corporations will run smaller surpluses (profits minus net investment), and other corporations will run larger surpluses, with the net result that the investment spree will show up as someone’s profit. Accordingly, corporate profits themselves will boom, but the persistence of the boom in profits will necessarily rely on the persistence of the boom in investment spending. That’s essentially what we observe at the moment, and it’s important to realize that the recent surge to record profits is there because the investment boom is there ......................
A.I. Fare:
OpenAI Chief Scientist Jakub Pachocki is dropping truth bombs. ............
An Excellent Warning
Jakub Pachocki has now fleshed out his full position on the current state of play.
Here are his key points, translated into my own voice:
- Smarter than human intelligence is coming in our lifetime.
- Based on internal results, he expects recursive self-improvement in a few years.
- No one is prepared for the consequences.
- OpenAI will unilaterally withhold further scaling as needed.
- OpenAI cannot do it alone. Broader interventions are required, including international coordination, to enforce commitments to formal safety bars.
- Capabilities progress can be steered and so far it has largely been steered towards rather than away from RSI, along with ‘automated alignment researchers.’
- Alignment is the core problem of AI research.
- Alignment splits into goal alignment (‘does the AI try to accomplish the goal?’) versus value alignment. Value alignment is what counts most.
- The fundamental challenge of AI alignment is generalization (of values).
- He sees two classes of alignment techniques: Goal-oriented RL, or improve generalization from pretraining data. They invest heavily in both types.
- OpenAI has invested heavily in Chain of Thought (CoT) monitoring.
- CoT monitoring is progressively diminishing in effectiveness.
- The main argument left for scaling AI is for cyber defense against scaled AIs.
- AI will not remain a tool.
- Our options are to accelerate alignment work or slow down capabilities scaling. We should do both.
- Ultimately he is counting on ‘automated alignment researchers.’
Or, if you narrow it down to the most important thing:
- Recursive self-improvement and superintelligence are coming soon. No one knows how to do this safely, our alignment techniques are inadequate and our monitoring technology is starting to fail. We need to figure out a solution, which will involve a combination of voluntary slowdowns, coordination around pacing, and investing further in alignment, including automated alignment researchers.
If more OpenAI communications were more like how Jakub Pachocki opens his new essay, An Alien Mind, I would feel much more confident we were in good hands there.
He does not mince words. ............................
............ This is a time that calls for extreme caution. I am concerned no one is prepared for the consequences of a continued rapid rise in machine intelligence.
Quite simply, they can no longer be trusted.
Worth at least a skim. Having lived through the financial crisis and been bearish on housing and subprime in 2006, I find the analogy here pretty compelling:
*** Zitron: Concentration Risk
............... even though it cannot define exactly what AGI means, but this is the AI bubble and those most-responsible for telling the truth are mostly incapable or unwilling to bother.
These companies are treating everybody like they’re stupid, in large part because everybody, including the largest media outlets in the world, appears to fall for just about anything.
...... If anything, the far-more-interesting way to look at this is why all of these people are suddenly jerking their shit from first principles over a term that is meant to mean “an artificial intelligence that can handle tasks beyond its original training” but now means basically anything the companies want it to, and how that times with the rush for both Anthropic and OpenAI to go public.
The answer is pretty simple: these people want to stop you thinking about what’s actually happening — that the underlying financials and demand do not make sense, and their cloud software does not remotely justify its alarming costs.
Today I’m going to talk to you about why I think there’s a Silicon Valley Financial Crisis brewing, and the concentration risks involved. ...........................................................................................................
These commitments were signed, I assume, with effectively no underwriting, because anyone with a calculator and sentience can see that on paper these companies cannot afford their commitments. The rationale is exactly the same as that used to hand-wave against worries around subprime defaults — that the system is working, that the system will always correct itself, and that things keep on growing.
In any case, neither OpenAI nor Anthropic actually have the money to pay for their obligations, and have only been able to keep up because of the low cost of signing contracts.
As these commitments begin, their needs for capital will dramatically accelerate in ugly chunks, both with hyperscalers and neocloud partners, on top of any debt deals they sign with Broadcom to fund their own silicon.
And the vast majority of these commitments and payments are yet to occur, which is, as is the theme of this newsletter, why nobody is worried yet.
.................... Once again, everyone assumes everything is fine, because the money has yet to run out, and because NVIDIA is promising 70% year-over-year growth in Fiscal Year 2028. Data center debt continues to be available for neoclouds as well as barely-existent data center developers like SB Energy (backstopped, of course, by NVIDIA), mostly because of the illusion of “massive demand for AI compute” created in part by NVIDIA itself.
....................... Anyone who tells you “not to worry” about a company that loses billions of dollars a year and has made $517 billion in compute commitments is a con artist, and anyone who prints a quote like that without a comment about how deeply worrying it is doesn’t really give a shit about whether you live or die.
But that really is the current state of the tech industry: a death cult obsessed with growth empowered by a media ecosystem obsessed with measuring and celebrating how much it’s growing and might grow in the future, always framed in the terms set by the rich and powerful.
The failure of both parties to meet the moment with clarity and purpose will lead to a market correction that likely dwarfs the Dot Com Bubble, exposing many of those involved as a phoney, a fraud, an imbecile, a ghoul, a coward, or utterly, impossibly ignorant.]
Quotes of the Week:
Marcus: It’s well-written and compelling, and it reminds me of something Douglas Hofstadter once wrote about Ray Kurzweil:“What I find is that it’s a very bizarre mixture of ideas that are solid and good with ideas that are crazy. It’s as if you took a lot of very good food and some dog excrement and blended it all up so that you can’t possibly figure out what’s good or bad.”
Investing Fare:
Partial knowledge is more often victorious than full knowledge; it conceives things simpler than they are and therefore makes its opinion easier to grasp and more persuasive. - Nietzsche
Information overload exists. We don't want too much information because it gets in the way of the facts needed for a good story. Hence, there is an optimal amount of information: discard facts that aren't needed to tell a coherent story; yet if we have too few facts, we may miss what's critical.
Good decisions always start with: Do I have the right information? Do I have enough information? What will I do with the extra information? Am I being too simplistic? Am I making the problem too complex?
Charts:
1:
1:
U.S. bonds are now in one of their worst stretches in more than 200 years.
— TreasuryBonds.com (@TreasuryBonds1) September 7, 2026
As of July 2026, the rolling 10-year annualized return for U.S. bonds after inflation was -5.14%.
That’s worse than the aftermath of the Civil War, the Great Depression and the inflationary 1970s.
The… pic.twitter.com/SdcdqFDb5S
(not just) for the ESG crowd:
I predicted the downfall of climate science in 2012. It is happening!
In 2012, I noticed some evident similarity between the downfall of the Limits to Growth study of 1972 and the ongoing trends of demonization of Climate Science. I published my impression on the subject on my old blog, Cassandra’s Legacy. I am sorry to have to report that I was right. We are facing an unexpected situation: the more the disaster of global warming becomes clear, the more the idea is rejected, demonized, and ignored.
Up to now, we tended to believe that, at some point, global warming would have become so evident as to be impossible to ignore. Some huge event, some giant disaster, some massive impact would have brought people together to do something serious to stop it. But the opposite is happening. ..........
........................ This is a systemic failure of the very element that makes us what we are: our minds. But nobody ever said that humans behave rationally, as we are proud to think we do. .........
Mapping the physical sequence where weather extremes defeat infrastructure thresholds, material inventories, and global supply buffers.
........ The current El Niño is looming, and it is operating beyond any recorded economic or climate history. So my first caution is to raise awareness that nobody really understands what is happening because it has no reliable precedent in Earth's history; we've never had a global civilisation before leaning on the climate, so what happened in the past may only be partly relevant.
............. The five market chokepoints are heat, calories, electrons, canals and rivers, and metals.
A tradeable supply chain impact requires a regional climate trigger, exposed infrastructure and a scarcity, with a delay or cost large enough to defeat available buffers.
Can what the world needs get through, and what might be the impediments? ...........................
The question running through the preceding chapter is whether the systems that supply our food, electricity, transport and industrial materials can absorb the next climate shock. James Hansen’s work adds another question: how quickly is the underlying climate changing while those systems try to adapt? ...........
A recurring theme in Hansen’s work is that the temperature we experience today does not reveal the full response to the changes we have already made to the atmosphere. The oceans absorb heat, delaying the surface response. ..............
In A Castle Lookout Doesn’t Wait for Eye Colour, I argue that credible warning signs justify preparation before every detail is settled. Hansen’s criticism is specific: he argues that the IPCC underestimates climate sensitivity and misjudges changing aerosol cooling, understating the acceleration of warming. He also warns that the spread of model results is not a reliable probability distribution of real-world outcomes. Treating it as one can give false reassurance about the limits of risk. ...................................................................................................................
Climate shocks can become a wider supply crisis when they damage production and constrain replacement supplies at the same time. The critical question is whether the backup remains available, deliverable and affordable when demand for it rises.
The IPCC already recognises compound and cascading risks. The practical task is to identify which dependencies could transmit disruption between food, electricity, transport and industryand where that sequence can be stopped. ...........................
Have We Already Crossed the Fateful Line?
It may well be that humanity has crossed the fateful point: fertility is now below the replacement level. That has never happened before in history. Welcome to a new world!
..................... I’ve argued at length, most recently in The End of Population Growth, that we have been thinking about this transition with the wrong curve in mind — a smooth S-shaped plateau, rather than the asymmetric rise-and-fall that seems to govern every complex system we’ve ever measured closely, from oil fields to empires to bacterial colonies in a Petri dish. ................
This is not one bad year in one country; it is a broad, systematic undershoot relative to official forecasts, and it has been the pattern for a decade. ............
Sci Fare:
................. At present, many of the world’s maps are based on the Mercator projection, created by European cartographer Gerardus Mercator in 1569. It is widely used for navigation since the north-south lines have constant true bearings relative to the equator.
However, it is less useful as a world map since the scale is distorted, with countries further from the equator appearing disproportionately larger than those closest. For example, on the Mercator, Greenland appears larger than the continent of South America and appears similar in size to Africa.
In reality, Greenland is roughly the size of the Democratic Republic of Congo and Africa is 14 times the size of Greenland.
Some critics of the Mercator projection suspect it has remained widely used because it enlarges and centers Europe, as well as other Western regions such as North America, perpetuating ideas of European superiority. .......................
U.S. B.S.:
We are in a situation, as a country, and I think largely as the West generally, that only Trump can solve.
Now, I don’t mean specifically Donald J. Trump. I mean specifically a person who understands power in the same way Donald Trump understands power. He understands that the executive branch is enormous, that it works for the president, and that when all of that power is pointed toward a purpose it can push through a hell of a lot of blockades. Treasury, Labor, Commerce, Energy, Transportation, federal procurement, federal credit, federal land, regulatory agencies, it’s all power. A president can treat that machinery as something to politely administer, or decide the country needs to go somewhere and put it to work getting there.
Trump has done the second thing. He has pushed presidential authority on tariffs, executive control over the government, elections, executive orders, independent agencies and the courts. When one route gets blocked, he looks for another. ......................
.......................... That is the part people leave out when they talk about American capitalism winning the war. The market didn’t wake up one morning, notice a profitable opportunity to defeat Hitler and organically produce the arsenal of democracy. The government decided what had to exist and then organized the public and private capacity needed to make it exist.
We did the same thing over and over again. We produced enough material to equip ourselves and supply the Allies. We built enough industrial capacity that after the war the United States could help rebuild Europe, build huge amounts of housing and infrastructure, expand electricity and create the material abundance people now look back on as if it somehow appeared naturally.
Donald Trump understands the power part. His problem is purpose. ..................................
From the vantage point of September, 2026 it might seem like pointless assholism to kick cancer-ridden, senile old Joe Biden when he’s down.
After all, we’ve got a rancid dotard in Trump threatening to nuke Iran in the midst of what John Mearsheimer is calling the greatest geo-strategic disaster in US history, why both with ol’ black-hearted Joe?
The reason is simple.
Until Americans, particularly Democrats reckon with just how vile, stupid, and deadly the last three Democratic presidential administrations have been (yes, America’s neocon foreign policy starts with Bill Clinton blowing up Yugoslavia and turning NATO into an offensive alliance and has continued to warmonger ever since, regardless of which party was in power), we’ll keep getting stuck with more of the same “not quite as bad as the Republicans” bullshit and the end of the republic will only escalate.
There is currently a well funded counter-revolution occurring in the Democratic party in which centrist Dems and the MSM are aligning to destroy anti-genocide candidates like Graham Platner in Maine (got him) and Abdul El-Sayed in Michigan (they’re still trying although he’s up in the polls).
If Dem voters don’t belatedly realize that their party establishment leadership is as corrupt as the GOP and actively push to purge them, we will not be able to vote our way out. ...........
One of the failures of imagination I see most often is the inability to understand that things were, actually, different in the past and that they are different in other places.
I live in Canada. In the West. Our leaders are all functionally psychopaths. They’re all corrupt and they all lie like they breathe. They have zero interest in anything but making their donors happy, and have spent over 50 years destroying the egalitarian society built by FDR and his successors, in order to give more money to the rich.
Many people think this is universal behaviour. It isn’t. ............
All of these things are contingent: they change over time based on circumstances. People have biology, but they also have vast amounts of conditioning based on what their society is like which forms their personalities. Leaders are chosen and promoted in different ways, emphasizing different morals and personalities at different times. Western leaders right now are mostly soulless psychopaths, but that hasn’t always been the case and even when it was, the morally neutral virtues they valued were different. (Courage, for example. Think what you want of 19th century British elites. They were scum. They were not cowards and intensely shamed cowards and people who didn’t do their duty.)
Humans are always humans, but the details change with the society and the time. If you over-generalize from your own time and experience you will make serious mistakes when you try and understand outside your time and society. .............
Or, how many lives is a think-tank grant worth?
................ Like everyone in our circle, we assumed preserving and growing state power—global primacy—was good for the world and therefore necessary. We were trained to believe that when it came to using force to murder others, we should be “giving the president more options.” And we took American exceptionalism for granted, which meant that no crime of our government, no failure of judgment, could ever wash away the good intentions of our elite community managing state power. How to square all that with loving Conscious Hip-Hop is something I’m still trying to figure out…
At any rate, if you pointed out to us the real harm foreign policy was causing, we had three moves (assuming we didn’t just ignore you). We would dissemble, which is to say we’d out-argue you on technicalities that amounted to whataboutism or blaming the harm on others. We would justify harm as worth whatever abstract upside we attributed to foreign policy—“the world would fall into chaos if US troops weren’t in Germany and Japan.” Or we would claim fecklessness, agreeing with you in spirit—“I hear ya, buddy!”—but shrugging with our hands up; nothing we can do about genocide or forever wars.
It took years (and distance) to finger my discomfort with this way of thinking and being. You cannot exist among well-educated people with impressive-sounding titles embodying the soulless ideology of national power and spitting a vocabulary of vacuous buzzwords without becoming like them. Practice makes habit. You are what you do repeatedly. ............................
Tupac had a word for those who lend their voices to the already powerful; those who are “blind to the fact,” as he liked to say, that they’re promoting a mix of neocolonialism and preventive war because it’s good for the corrupt sections of capital that fund their think tank. “Bitch-made.”
How Wealth Is Reshaping Global Politics
War Fare:
.................................... If President Trump could end the war in a way that he can reasonably describe or defend as a victory, he would. And he may be preparing to, according to recent reporting.
But so far, the situation doesn’t lend itself to that possibility. Iran has not surrendered and the regime has only become more hardline and resistant to negotiations, insisting that the United States make a series of incredible concessions that would effectively allow the country to rebuild the nuclear program President Trump set out to stop. .......................
Murray: Nonsense Drones and Novichok
Europe urgently needs to re-establish access to Russian oil and gas. Gas prices are high – as all UK energy consumers know – and German gas storage is at a record low for September. Gulf production is degraded, supplies are cut off and its long-term strategic stability undermined.
German manufacturing already suffered a 9.5% production loss from 2022 to 2026 following the Russian gas shutdown, with the loss in energy-intensive manufacturing (inc petrochemicals, chemicals, metals, glass/ceramics/stone, paper, mineral oil etc.) at 15.2%.
Western Europe can regain access to Russian hydrocarbons either by accepting a negotiated peace in Ukraine, or by attempting regime change in Russia. The political class in Europe have evidently decided to go all out for regime change.
It would of course be much easier, and much safer, to settle the Ukrainian conflict. We can identify the following reasons the European political “elite” is not taking that path:
- Loss of face and political capital by in situ leaders who have gone all in for conflict with Russia – von der Leyen, Kallas, Merz, Rutte, Stubb etc
- Generational family and national hatred of Russia by those wanting to reverse World War II in Eastern Europe – von der Leyen, Kallas, Merz, Stubb etc
- Deep common interests between the political personnel and the military-industrial complex
Note that none of these motives has anything to do with the welfare of their people, and still less “democracy.” I find it very hard to think of any occasion when a drive towards war had such little foundation. ..............
Propaganda watch with Kit Klarenberg
........... Western coverage of Russia operates on a Schrödinger principle. The same voices who insist Moscow cannot escalate, is a failed state, and will crumble if only we send one more munition also insist it is a hyper-competent menace about to test NATO.
The effect is hyper-normalization: nothing is reliably true except that Russia is the villain. ........................
Energy prices are another exercise in gaslighting. Ukrainian deep strikes on refineries were widely celebrated as ‘turning the tide’ until Scott Bessent suggested they were raising global energy costs. Bessent’s statement is itself ridiculous on the basis that the main reason for the global energy crisis right now is America’s wholly ill-consdered war against Iran. ................
NATO expansion into states that cannot defend themselves and whose national myths require permanent hostility to Russia has made the alliance captive to its most reckless members, most notably the Poles and the Balts. ...............
.................................... What may weigh just as heavily with the Kremlin is with how much pleasure European officials and talkshow hosts celebrate Ukrainian drones hitting Russian refineries, how unabashedly Europe pins these attacks to its own flag.
At this point one could object that all of this is irrelevant, since a state that makes use of its right to self-defense equally has a right to the support of other members of the international community. Europe, this argument goes, is only doing what any decent state would do to assist victims of wars of aggression. Therefore, Russia must not take it personally, i.e. consider Europe’s support for Ukraine direct participation in the war.
This noble theory starts to look shaky not just in light of European practice. In the illegal war of aggression the US launched against Iran, Europe not only failed to help the victim, but assisted the aggressor. And a thought experiment, in which, say, Iran targets European cities with missiles paid for openly and with hand-rubbing glee by China or Russia, makes clear that Berlin, Paris or Copenhagen would most certainly take it personally.
Getting into a game of chicken is dangerous and irresponsible. Once you step on the gas, you might not be able to swerve away in time. But what if the collision is the point? .................................
While Europe’s broad political middle takes deliberate steps that make war with Russia more likely, others put out urgent warnings. Former Financial Times editor Wolfgang Münchau admonishes in UnHerd that rhetorical escalation is often followed by physical escalation, and that the current war euphoria in Europe reminds him of 1914. Leftist economics professor Branko Milanović is appalled by certain European states’ lust for war and argues for freezing the conflict, because a frozen conflict is better than a forever war, which he sees skidding into nuclear escalation.
Europe is in the midst of a slow slide into a big war. Significant parts of Europe’s elites are practically willing it into being. ..............
Geopolitical Fare:
Johnstone: Liberal Zionists Are Evil Shitbags
................ This is liberal Zionism in a nutshell. The problem isn’t Israel damaging Palestinian lives, the problem is Benjamin Netanyahu damaging Israel’s public image. The problem isn’t the genocide itself, the problem is that the genocide harms Israeli PR interests. .....................
Now it’s just a matter of the world coming together to dismantle a genocidal apartheid state. Because we all know that’s what needs to be done.
....................... when you live under the most murderous and tyrannical power structure on the planet, your individual little quirks and facets are a lot less significant than the extent to which you oppose the abuses that your rulers are inflicting upon human beings around the world. If you met a German in 1940, you would probably be a lot less curious about his taste in music and fondness for dapper suits than you would be about his level of support for Adolf Hitler.
That’s you right now. You’re the German in 1940. The most interesting and relevant thing about you is the extent to which you oppose the globe-spanning empire you live under. At this point in history, everything else about you is a very distant second. ...............
What do Iran and Canada have in common? Really as good as nothing, to Canada’s shame. Let’s leave aside the basic differences, such as location, demographics, weather, and cuisine, and focus on the essentials: Historically, Iran is old and firmly based on an ancient civilization; Canada, like the US, is young and a little accidental, a leftover of the British Empire in its settler-colonial-ethnic-cleansing variant.
In terms of religion, Iran is shaped by pious Shia Islam; Canada displays the flaccid mix of an emasculated Christmas-and-jingle-bells-only Christianity and aggressive anything-goes consumerist secularism typical of the contemporary West.
Geopolitically, Iran is a proud and victorious opponent of the US and Israel; Canada is a fairly ordinary vassal in the American empire.
Accordingly, Canada is deeply and proudly involved in the West’s proxy war against Russia by way of using up Ukraine. Indeed, the Canadian contribution is particularly ironic because it also serves a frenetic and powerful nationalist Ukrainian lobby, rooted in deliberately privileged fascist World War Two runaways and Cold War conspirators. Iran, on the other side, has long helped Russia and, for its efforts, been directly attacked by Kiev’s Zelensky regime. In return, Western sources claim, Moscow has been helping Tehran with its ongoing defense against the US and Israel.
Most importantly, Iran is a country on the side of elementary decency, fundamental human ethics, and international law and therefore against the genocide committed by Israel, the US, UK, Germany, and various other Western accomplices against the Palestinian nation. Canada – Israeli murders of Canadian citizens and some cheap and, in effect, empty gestures from Ottawa notwithstanding – has been, at the very best, yet another camp follower of the Western genocide coalition.
And yet, strange as it may be, recent events have produced something that Iran and Canada have in common. Or to be precise, it’s Washington’s bizarre policies that have created this odd overlap: both Canada the long-standing vassal and Iran the steadfast antagonist are currently at the receiving end of both fresh attempts at coercion by economic warfare and escalating rhetoric from Washington.
Of course, there are orders-of-magnitude differences between the Trump administration’s “Operation Economic Outcast” against Tehran and the latest round of tariff-and-trash-talk launched against Canada. .............
Book Fare:
Jensen: Domination/Subordination Dynamics: Five Foundational Books Challenging Illegitimate Authority
Other Fare:
Welsh: So Tired Of All The Lying
...................... All of these lies exists because some group of evil scumbags want to do something that they know is bad for the majority of people. They need to manufacture consent, or at least muddy the issue enough to enrich themselves by impoverishing, sickening or straight up killing people.
It is that simple. It is that simple. It is that simple.
And it is radicalizing me to a degree I would never have thought possible because nothing can be fixed while these people are in charge or even tolerated. They all need to be removed from having any influence or power or wealth. This means basically every senior executive, every politician and every senior editor, producer or media owner. (Yes, there are exceptions, they are so exceedingly rare that they are meaningless.) ....................
People who believe capitalism is working out great are just sloppy thinkers who’ve fallen victim to survivorship bias and the just-world fallacy.
Survivorship bias is when your analysis focuses on those who made it while ignoring those who didn’t. ................
That’s where the just-world fallacy comes in. The just-world fallacy is a cognitive bias which assumes that everyone gets what they deserve: that good things happen to good people and bad things happen to bad people.
The appeal of this fallacy is that it gives us a sense of control. It allows us to believe that nothing bad will happen to us if we just do the right thing
.....................
If you can get real with yourself about this, you will understand why the system needs to change. A system which insists upon maintaining a very large tier of society who must stress and struggle throughout their lives is not a just or moral system. It cannot be defended by anyone with a rational mind and a well-formed conscience. .......................
Bear: It’s Hard To Know Things And Not Sound Like A Depressed Bore
I rarely leave it this long between writing, but I’ve been somewhat overwhelmed by the sheer volume of fuckery we face.
I rarely leave it this long between writing, but I’ve been somewhat overwhelmed by the sheer volume of fuckery we face.
..................... And what I’ve been mainly thinking is that the burden is both in the knowing, and the caring. Doomscrolling is a misnomer, a term used to rhetorically delegitimise those who keep up with the torrent of horrible news and the numerous, accelerating and overlapping crises we’re presented with. And not to sound snobbish, but the reality is that the majority of people who get their news from mainstream sources are shielded from knowing the worst of it. They are shielded from doom, because too much knowledge imperils the system .......................
How do you tell people your fears about the collapse of the ecological and biophysical conditions on Earth that enabled the rise of organised societies? How do you explain to people what the holocene is (was) and what the end of the holocene means for organised society? How do you tell people that the constant breaking of heat records signals a climatological phase-shift that imperils civilisation without sounding like a panicked tin-foiler? How do you explain that in ice cores, and soil samples, we see no echo of a past world that underwent a change as rapid as this? How do you explain that we live, essentially, in the ruins of a once-abundant planet, destroyed by capitalism, for capitalists, without sounding incredibly depressed. And how do you explain that the process is far from over, that it continues with gusto, and it will lead, without revolutionary change away from extractivist growth economics, to truly dystopian futures that make concerns about mortgages, careers and children, both quaint and tedious.
And how do you even talk about children in the context of these futures? With incredible difficulty is my experience.
How do you explain that there is no way out under systems of liberal democracy? That voting is a busted flush, a narcotic designed to make you feel good about yourself and your participation in the process, not to deliver material change? How do you explain that the democratic process is captured, and the only chance to save what you love is through revolutionary organising and revolutionary acts? .......................
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