Individual Economists

Trump Admin Floats Unfreezing Russian Assets In Big Move To Restart Talks

Zero Hedge -

Trump Admin Floats Unfreezing Russian Assets In Big Move To Restart Talks

President Trump appears to be busy rolling back years of entrenched Ukraine policy. Starting last week he announced the controversial diesel deal with Putin, and this week Ukraine's Zelensky is complaining that intelligence-sharing has been throttled, and possibly even cut off.

The possibility or even likelihood of this heading to another TACO moment aside, what's next? New reporting in the Financial Times gives an idea. The United States has floated a proposal that European countries unfreeze some of Russia's sovereign assets and deposit them in an entity controlled by Washington.

via Associated Press

The FT report cites four people familiar with the matter, who describe that the idea was formally presented by envoys Steve Witkoff and Jared Kushner during a meeting of Western allies and Ukraine in Miami on Oct.10.

"The US suggested several possible methods for unfreezing the assets, including for them to be moved into a new special-purpose financial vehicle overseen by Washington," the sources said.

This US plan would be enacted in the hope of opening up momentum toward a comprehensive Ukraine peace plan. Moscow has of late rejected any 'temporary' proposal, including a 60-day pause in fighting recently offered by Zelensky. It wants a lasting political settlement and not a mere 'pause' along the front lines.

At the Miami meeting were NATO representatives, as well as officials from the US, France, Germany, and the EU.

"Many ideas have been floated as to how Moscow's frozen assets could be used after the war, the US official added," the FT says.

European officials are said to have balked at any initiative to let go of Russian assets. "They were told that this was just simply not going to happen," one source said. For example, Germany has voiced its clear position:

"Those are assets that are frozen ​in Europe and they should remain frozen in Europe. ​This is our business and we are deciding over ⁠it," Merz said in Brussels ahead of an EU ​summit.

At least €260 billion in sovereign assets belonging to Russia's central bank were frozen in 2022 as a result of Russia's full-scale invasion of Ukraine in February of that year. Most of this is held at the Belgian securities depository Euroclear. The vast majority, or over €210 billion of the sum, is held in the EU.

The last couple years of war has seen the EU work out a scheme wherein payments are made to Ukraine utilizing interest gained from Russa's funds.

Washington's sudden willingness to ease off the pressure on Moscow has interesting implications regarding the Iran war...

European Commission President Ursula von der Leyen said that Moscow "must pay for the destruction it has caused. And we are using the proceeds from the immobilized Russian assets to make sure it does."

"We are making a further [$1.62] billion of them available to Ukraine. This will support Ukraine's continued resistance against Russia's illegal war," she had announced in August.

Tyler Durden Thu, 10/15/2026 - 09:40

Suspected ISIS Bomber Lived In UK Taxpayer Hotel After Small Boat Arrival

Zero Hedge -

Suspected ISIS Bomber Lived In UK Taxpayer Hotel After Small Boat Arrival

Authored by Steve Watson via Modernity.news,

Reports have emerged of a suspected ISIS operative and alleged rapist being housed in a taxpayer-funded hotel following his illegal arrival in the UK.

"Britain is getting the dregs," GB News presenter Patrick Christys urged, reacting to the case of an Iraqi man who crossed the Channel, gave a false name, and lived undetected for weeks before German authorities tipped off the UK National Crime Agency.

Layth Ibrahim Mohammed, 39, is accused of links to Islamic State in Iraq during the 2010s, including making booby-trapped bombs and teaching the children of ISIS fighters at a school run by the group.

He arrived by small boat from France in August 2025, claimed asylum, and was placed in a Home Office hotel in Oldham, Greater Manchester. NCA officers arrested him there in October 2025, but only after Germany flagged his background.

He is now fighting extradition to face terrorism-related charges and an allegation of raping a German woman. The allegations have not been established in court.

His lawyer, Joanna Curtis, told a Westminster hearing that extradition would be inhumane because "he has significant mental health issues, including severe anxiety, as well as depression." She linked the trauma to a bomb attack in Iraq that killed his son and even laughably cited symptoms of "pins and needles."

This is not an isolated failure. Earlier this year, another ISIS-linked man reached Britain the same way after social media reassured him the UK takes everyone.

Mohammed Yaseen, previously convicted in Germany for ISIS membership, attended beheadings and floggings in Iraq, then crossed after watching TikTok videos claiming Britain "accepts everyone and respects human rights."

He gave false details, was processed, and only later identified by biometrics. Prosecutors described him as high risk.

The pattern is clear: people with documented extremist histories clear the Channel, destroy or withhold documents, and enter the asylum system before any meaningful check occurs.

The scale makes individual cases inevitable. Small-boat arrivals since Labour took office have already surpassed the strength of the British Army.

More than 83,000 crossed between July 2024 and September 2026, exceeding the Army's roughly 83,000 regulars and outnumbering the Navy and RAF combined.

Total arrivals since 2018 top 200,000. The vast majority are military-aged men. Shadow Home Secretary Chris Philp called it "completely bonkers," noting Labour had "let an entire army-sized population cross the Channel illegally."

Reform leader Nigel Farage has repeatedly warned the crossings represent a national security emergency.

At this week's Prime Minister's Questions he pressed Andy Burnham directly: "Every week there are young, unidentified males from Iran coming into this country, some of whom pose a genuine security threat to our nation. Is it not time the Government recognises that what is going on in the English Channel is a national security emergency?"

Burnham replied that crossings were "coming down" and removals were up, while acknowledging more needed to be done. Farage has described the situation as an "out-of-control disaster."

The numbers are not sustainable on any measure. Settlement grants alone have reached one every minute.

Home Office data show 140,000 grants of settlement or citizenship in a single three-month period. Asylum system costs hit £4.3 billion in one year. Fewer than 5 percent of Channel arrivals since 2018 have been removed.

Foreign nationals are disproportionately represented in certain offence categories, including sexual offences. The system continues to grant status and benefits while the backlog of appeals grows.

Much of this rests on claims that officials themselves describe as fraudulent. A Home Office caseworker with years of experience processing thousands of applications stated that "at best 1 per cent of asylum seekers are genuine."

Identical "package claims," recycled stories, and fabricated evidence are routine. Networks coach applicants for thousands of pounds. Staff are instructed to treat claimants as "customers." Modern slavery claims are nearly impossible to disprove and routinely succeed.

The result is a system that rewards illegal entry while genuine refugees and British citizens compete for housing, healthcare, and public resources.

Local authorities have responded to public concern by locking down entire towns rather than stopping the boats. In Gosport, police used multiple public-order powers to restrict residents, ban face coverings, and disperse gatherings so that hundreds of unvetted men arriving on mega-dinghies could be moved in luxury coaches.

Anti-migrant protesters faced arrests; an activist who slashed a dinghy was remanded in custody for months. The contrast with the rapid bail of terrorism suspects elsewhere is stark. Residents are treated as the problem while arrivals with unknown backgrounds are protected and housed.

These cases - ISIS suspects in hotels, arrivals outnumbering the Army, a system insiders call a scam, and towns placed under lockdown to facilitate landings - are not separate scandals. They are the predictable outcome of a policy that prioritises processing over screening, accommodation over removal, and international obligations over the security of the existing population.

Farage has called for the Royal Navy in the Channel and a pause on asylum claims. Successive governments have preferred payments to France and further hotel contracts.

The result is visible on the Kent coast, in Oldham hotels, and in the courtrooms where extradition is contested on mental-health grounds after the individual has already lived at public expense.

Britain cannot indefinitely absorb unvetted military-aged men, some with documented terror links, while maintaining public safety, housing stock, and basic services.

British society rests on a basic social contract: the state collects taxes and enforces laws in return for protecting the people who already live here. That bargain is rapidly fraying in real time.

The patience that has sustained decades of mass illegal entry is not unlimited. Once enough people conclude the state will not prioritise their safety, their housing, or their taxes, the remaining consent that keeps the system functioning quickly erodes. That is the edge the current policy has reached.

Tyler Durden Thu, 10/15/2026 - 09:25

Initial Jobless Claims Hover At 57-Year Lows

Zero Hedge -

Initial Jobless Claims Hover At 57-Year Lows

For the fifth straight week, the number of Americans filing for jobless benefits for the first time was less than 200k (199k)...

That is the longest streak below that level since 1969! (And remember, the labor force then was a fraction of what it is now).

Interestingly, Ohio, Tennessee, and California saw a rise in unadjusted claims last week...

Continuing claims remains low too - holding around 1.7 million Americans - the lowest level since March 2023...

However, as we noted last week, payrolls tell the other half of the story. September nonfarm payrolls came in at just +29k (with prior months revised down), well below the already modest recent trend. Net employment change is simply hires minus separations. When separations are that low but the net number is mediocre, hiring itself must have slowed substantially.

So the market has cooled mainly through reduced hiring rather than rising firings. That keeps the unemployment rate relatively contained (4.2% in September) even as it becomes harder for job seekers, switchers, and new entrants to land roles. 

Economists (including various Fed research notes) have been describing this as a stable-but-fragile equilibrium for a while: low layoffs prop things up, but the low hiring rate leaves little cushion if demand weakens further or a shock forces companies to start cutting.

It’s also consistent with slower labor-force growth from demographics and reduced immigration - fewer people needing to be absorbed means weaker payroll growth can still leave unemployment from rising sharply.

The bottom line is simple: the 'low-hire, lowest-fire' economy continues to roll along with no obvious signs of AI's productivity surge (or replacement projections).

Tyler Durden Thu, 10/15/2026 - 09:15

States Sue OpenAI, Claiming ChatGPT Gives Young Users Dangerous Advice

Zero Hedge -

States Sue OpenAI, Claiming ChatGPT Gives Young Users Dangerous Advice

Authored by Jill McLaughlin via The Epoch Times,

Eight states filed lawsuits against OpenAI Oct. 14, claiming the company's ChatGPT app harms children, deceives parents, and violates state consumer fraud laws.

The states - Iowa, Kansas, Nebraska, Arkansas, Idaho, Montana, and Arizona - individually filed lawsuits in their states, alleging the chatbot was giving dangerous medical advice, encouraging people to hurt others, and coaching people to commit suicide while pretending to be a friend.

"We will not just accept that any big tech company can make money by hurting Iowa's kids and use them as lab rats in a race to be the first, or the biggest, or have the most users," Iowa Attorney General Brenna Bird told reporters Wednesday during a news conference on the lawsuits.

Chatbots and artificial intelligence (AI) are becoming increasingly popular with teens. Almost two-thirds - 64 percent - of teens ages 13 to 17 reported using chatbots, with about 30 percent using them every day, according to a report published in December 2025 by Pew Research Center.

ChatGPT is by far the most popular among teens and favored by 59 percent of them, the survey found.

The lawsuits filed Wednesday claim ChatGPT is marketed by OpenAI as a safe product but, in reality, it is designed to be dangerous to vulnerable users, like children, and coaches them to commit suicide or to harm other people.

The states are asking the courts to compel OpenAI to comply with state consumer fraud laws, which prohibit deceptive business practices.

OpenAI responded to the filing of lawsuits, saying the company has implemented several safety measures and is continuing to work to build more safeguards.

"We've built industry-leading, age-specific protections into our product that many other AI products lack," OpenAI's spokesman Eric Porterfield told The Epoch Times in an email. "While no system can be perfect, we'll continue to work with experts to inform our work and build additional safeguards, such as the parental controls, break reminders and age-appropriate model protections that exist today."

The company is committed to working with states on advancing pragmatic AI policies that apply to the entire AI industry, according to Porterfield.

OpenAI claims its chatbot is intended for users age 13 and older. Users under 18 need permission from a parent or guardian to use it.

ChatGPT for Teens applies default safeguards for users under 18, OpenAI claims. Teens can manage and delete their chats and history, and control whether their conversations are used by the company to train models.

The company claims 90 percent of its teen ChatGPT users only use it for learning, skill-building, or productivity. Half of the teens who use it for conversations take breaks when they are given a break reminder, according to OpenAI.

Kansas Attorney General Kris Kobach said the states moved ahead with lawsuits instead of waiting for Congress to set federal guidelines.

"We're in a world right now where the AI companies - and in this case OpenAI - are asked to police themselves," said Kansas Attorney General Kris Kobach during Wednesday's press conference. "And as our cases allege, they've done a very poor job of policing themselves and have placed the public in danger."

Florida became the first state to file a lawsuit against OpenAI and its CEO Sam Altman in June, alleging its chatbot concealed serious risks, suppressed internal safety warnings, and deceived Floridians.

Florida Attorney General James Uthmeier launched a criminal investigation into OpenAI in April after ChatGPT gave detailed advice to a suspected shooter who allegedly used it in a deadly campus shooting at Florida State University last year.

Tyler Durden Thu, 10/15/2026 - 09:10

Pump-Pain Spreads: Retail Sales Soar To Record High, Sentiment Sits As Record Low

Zero Hedge -

Pump-Pain Spreads: Retail Sales Soar To Record High, Sentiment Sits As Record Low

BofA's omniscient analysts expected a hotter than expected retail sales print this morning (but it came with a warning as they start to see some substitution effects as rising gasoline spend is wearing on discretionary purchases).

Once again, BofA was right, with headline Retail Sales surging 0.8% MoM (+0.3% exp), lifting sales up by 6.3% YoY...

Spending at gasoline stations soared...

Eight out of 13 categories posted increases, led by a 6.4% increase in the value of purchases at gas stations. While consumers pulled back on spending on things like hobbies and building materials, sales at furniture retailers, electronics stores and restaurants increased.

This was not good for GDP as the so-called control-group sales - which feed into the government’s calculation of goods spending for gross domestic product - increased just 0.1% after surging the prior month. The measure excludes food services, auto dealers, building materials stores and gasoline stations.

The figures indicate consumers took a breather as the third quarter drew to a close and price pressures mounted. Faster inflation is taking a bigger toll on Americans’ paychecks and squeezing their budgets.

And BofA's data appears to confirm that spending at the pump is squeezing spending elsewhere...

The AAA national average price of gasoline has stayed above the politically sensitive $ 4-per-gallon level for the last three months. Diesel has been above $5 over the same period and is flirting with a record high amid a global refining crisis. As we've outlined using high-frequency data, high fuel prices affect consumer behavior and spending patterns at convenience stores and gas stations. 

The latest comes from UBS analyst Ritu Solanki, who wrote in a brief note on Wednesday about US bank earnings that delivered an inconvenient message for those hoping for a recession: the economy remains resilient, but inflationary pressures persist.

Solanki said consumer spending, loan growth, and corporate activity remain healthy, while credit performance shows limited evidence of broad deterioration.

Solanki then cited Bank of America spending data for September showing consumers are spending more on fuel with credit and debit cards, up more than 20%. The risk is that rising fuel bills are crowding out other purchases. 

BAC's card data show accelerating fuel spending alongside softening spending across several other major categories, suggesting higher pump costs are pinching household budgets.

Total card spending per household rose about .2% in the month, slowing from 1% in August, on a seasonally adjusted monthly basis. Meanwhile, gas spending jumped 5%, up from 3.1% in August. 

Several categories contracted in September:

  • Home improvement: 1.6%
  • Department stores: 1.1%
  • Clothing: .9%
  • Furniture: .5%
  • Restaurants: .4%
  • Groceries: .2%
  • Online spending: .1%

The spending data suggest that fuel bills are squeezing room for other purchases, translating into dismal consumer sentiment ahead of the midterm elections. 

Is it really as bad for the American consumer as it has ever been?

Chief executives at Domino’s Pizza and Albertsons acknowledged in recent earnings calls that many consumers remain in a challenging economic environment. Even so, Wells Fargo & Co., JPMorgan Chase & Co. and Citigroup Inc. have also signaled that the consumer remains resilient.

Tyler Durden Thu, 10/15/2026 - 09:00

Muslim Hate Preachers OK, Harry Potter Not OK

Zero Hedge -

Muslim Hate Preachers OK, Harry Potter Not OK

Authored by Steve Watson via Modernity.news,

Mayor Sadiq Khan's London is under pressure to cancel Harry Potter-themed Christmas lights on Oxford Street because the woman who created the series refuses to pretend men can become women.

The Good Law Project and thousands of petition signers want the display blocked, arguing it would fund "anti-trans rights" work and make some people feel unwelcome.

At the same time, the same authorities have green-lit advertising featuring Islamic preachers known for inflammatory views on gay people.

A City Hall Conservatives clip shows Conservative Assembly Member Emma Best questioning Deputy Mayor for Culture and Creative Industries Justine Simons, who appeared disappointed by a Harry Potter section of the lights and was pressed on whether she would go further and ban it.

The campaign is straightforward. Organisers claim the lights, intended to promote the new HBO series, would generate more money for JK Rowling, who has used her platform and resources to support women's sex-based rights.

A Good Law Project spokesperson asked: "How can Mayor Khan tell trans Londoners that 'this city is yours too', whilst allowing a Christmas lights display to go ahead that will help fund anti-trans rights groups? The mayor must back up his words with action."

City Hall's response was that neither the Mayor nor the Oxford Street Development Corporation arranges the lights.

A spokesperson stated: "The Christmas lights on Oxford Street are not arranged by the Mayor or the Oxford Street Development Corporation, and this is a matter for the New West End Company and local businesses. The Mayor is clear that he will always support and champion all of London's diverse communities, including trans and non-binary Londoners."

In the assembly session, Best challenged Simons on the Harry Potter elements, noting the apparent disappointment and asked whether Simons would ban the fictional wizard franchise outright, in spite of its contribution to London's tourist economy.

Simons responded with hesitation and deflection, prompting Best to reference a London tube ad featuring a cleric who called gay people "filthy" and "worse than animals."

TfL had treated it as compliant before removal. The contrast is explicit: disappointment or pressure over Harry Potter linked to Rowling's views, versus prior tolerance of advertising from a preacher with extreme anti-gay statements.

The Mayor's office has a history of this.

Sadiq Khan faced criticism after ads for the Islamic finance platform Wahed appeared on the London Underground, buses, and platforms featuring preacher Ismail ibn Musa Menk (also known as Mufti Menk) burning US dollar and euro bills under slogans such as "Join the money revolution" and "withdraw from Riba."

Menk has been banned from several countries for inflammatory teachings and has previously described gay people as "filthy" and "worse than animals."

Critics, including Conservative Assembly Member Susan Hall, highlighted the double standard: TfL had banned or forced changes to far milder ads, such as a comedian's hot dog promotion (replaced with a cucumber over "unhealthy eating" rules), Protein World's "beach body ready" bikini ads, and others deemed to promote negative body images or junk food.

Transport for London also allowed ads promoting tourism to Brunei to run on the Underground even as the country had just introduced a law permitting the stoning to death of gay people.

Critics pointed out the inconsistency of permitting promotion of a jurisdiction with extreme anti-gay penalties while restricting commercial imagery considered insufficiently progressive or healthy. TFL was eventually forced to remove the ads.

Meanwhile, as activists and City Hall figures try to police festive lights, the BBC is preparing a two-part documentary on Rowling as "one of Britain's most polarising public figures."

The series, produced by Rogan Scotland for BBC Factual and BBC Scotland, will air on BBC Two, BBC Scotland and iPlayer. It uses Rowling's life "as a lens through which to explore three decades of profound social, political and technological change."

The production material states she is "admired by supporters as a fearless defender of women's rights, and condemned by critics who call her an opponent of trans equality," and that she "finds herself divided from some of the actors and fans who once championed her work."

I think we can safely guess in what direction it will lean.

Producers say it will draw on rare archive material, Rowling's own words, and interviews with people who have worked with her in the past. Rowling herself has no involvement; a representative confirmed she is aware of the project but has not contributed.

James Rogan, executive producer, added: "J.K. Rowling has achieved extraordinary literary success, with her influence spanning a generation of fans, crossing into cinema and the online world. Rogan Scotland explores her unique story from her early days as a writer to the present moment and how her unflinching personal beliefs have sparked a fraught and divisive dialogue that continues to this day."

This framing arrives after years of Rowling stating a basic biological fact: sex is real and immutable.

She has repeatedly said she supports people living as they wish while opposing the erasure of women's single-sex spaces, sports, and language.

Earlier this year she noted that some former Harry Potter film actors appeared to treat their past association as a licence to criticise her publicly. She observed that people who have never lived ordinary adult life without wealth and fame can remain "ignorant of how ignorant" they are.

         

The wider climate in Britain has made ordinary statements of reality into political flashpoints. The Supreme Court has ruled that a woman is defined by biological sex.

Parents have faced the prospect of prison time for questioning their child's desires to transition.

Meanwhile, we've seen ample stories such as this one about toddlers being removed from nursery after being labelled transphobic.

Rowling's position has remained consistent through all of it: sex is observed, not assigned, and women and girls deserve spaces and language that reflect that reality.

The attempt to turn Christmas lights into a loyalty test, the response from Deputy Mayor Justine Simons when asked about banning Harry Potter, and the decision to commission a documentary that treats basic biology as a source of "polarisation" all point to the same pattern.

Institutions and campaign groups continue to treat disagreement with gender ideology as a problem to be managed or excluded, even while other forms of exclusion and hostility receive different treatment.

Tyler Durden Thu, 10/15/2026 - 08:50

Inflation Is 'Broadening Out' As Producer Prices Soar Most In 4 Years

Zero Hedge -

Inflation Is 'Broadening Out' As Producer Prices Soar Most In 4 Years

After yesterday's accelerating CPI scare, this morning analysts expected a concomitant surge in producer prices - the big question remains whether it's all energy... or are price-hikes 'broadening out' making The Fed's job harder.

Headline PPI exploded higher in September, rising 1.3% MoM (more than double the 0.6% expected and biggest monthly jump since March 2022), dragging producer prices up 6.3% YoY (+5.4% exp) - the highest since Dec 2022...

Energy dominated the surge in prices...

Final demand goods: Prices for final demand goods advanced 2.6%, in September, the largest increase since data were first calculated in December 2009. Over 80 percent of the broad-based rise in September is attributable to the index for final demand energy, which jumped 10.8 percent. Prices for final demand foods and for final demand goods less foods and energy advanced 1.2 percent and 0.3 percent, respectively.

Product detail: Half of the September increase in the index for final demand goods can be traced to prices for gasoline, which jumped 20.3%. The indexes for diesel fuel, fresh and dry vegetables, jet fuel, residential electric power, and crude petroleum also rose. In contrast, prices for chicken eggs dropped 39.7 percent. The indexes for thermoplastic resins and materials and for commercial electric power also declined.

Final demand services: Prices for final demand services moved up 0.8% in September, the largest rise since advancing 0.8% in April. Nearly half of the broad-based September increase can be attributed to a 1.4-percent rise in margins for final demand trade services. The indexes for final demand transportation and warehousing services and for final demand services less trade, transportation, and warehousing also advanced, 3.4 percent and 0.3 percent, respectively.

Product detail: Over 20 percent of the September increase in prices for final demand services can be traced to margins for machinery and vehicle wholesaling, which advanced 3.9 percent. The indexes for truck transportation of freight, food and alcohol wholesaling, traveler accommodation services, food retailing, and airline passenger services also rose. Conversely, margins for automotive fuels and lubricants retailing dropped 30.3%. The indexes for securities brokerage, dealing, and investment advice and for chemicals and allied products wholesaling also fell.

The Energy PPI component is now at a record high (clearly tracking diesel prices more than crude)...

Over 80 percent of the broad-based rise in September is attributable to the index for final demand energy, which jumped 10.8 percent

  • Half of the September increase in the index for final demand goods can be traced to prices for gasoline, which jumped 20.3 percent.

  • The indexes for diesel fuel, fresh and dry vegetables, jet fuel, residential electric power, and crude petroleum also rose.

More problematically, Services costs are soaring too as energy costs spread across the economy...

Portfolio management costs ticked up along with stocks yet again...

Core PPI was just as bad, rising 0.7% (more than double the 0.3% expected) and that pulled core Producer Prices up 5.0% YoY (the hottest since Dec 2022)...

Prices for final demand goods advanced 2.6%, in September, the largest increase since data were first calculated in December 2009' but Services costs are also jumping...

Worse still, the pipeline for future producer prices is ugly with intermediate demand prices surging...

The CPI-PPI spread continues to (broadly speaking) signal increased pressure on corporate margins...

None of this provides any support for doves at The Fed and 2Y Yields and rate-hike odds are rising again, but not like they did post-CPI.

Tyler Durden Thu, 10/15/2026 - 08:43

Futures Slide As AI Unwind Goes Global: Kospi Crashes Into Bear Market, Treasuries Soar

Zero Hedge -

Futures Slide As AI Unwind Goes Global: Kospi Crashes Into Bear Market, Treasuries Soar

US futures are lower as the AI unwind goes global - Korea's Kospi crashed into a bear market and tripped circuit breakers, CoreWeave bonds sank deeper into distress and Anthropic's still-blistering but slowing growth failed to impress - while yesterday's hot CPI scare has morphed into a growth scare; as a result Treasuries are ripping higher with 10Y yields tumbling 10bps to 5.08%, the lowest since Sept. 23. As of 6:20am ET, S&P futures are 0.3% lower at 7,749 while Nasdaq futures slide 1.1% to 29,857 and Dow futures are up 0.2%; small caps are the odd man out with Russell 2000 futures up 0.3%. Yesterday the S&P 500 fell 1.1% to its worst day since July, the Nasdaq 100 lost 2% and the SOX dropped for a sixth straight session. Premarket, Mag-7 and AI baskets are all lower with Apple the only Mag 7 name in the green; chipmakers, memory, neoclouds and AI infrastructure names are all sliding, with CoreWeave down another 6-7% after imploding 15% yesterday as its bonds traded at distressed levels. The day's driver is AI financing (again): Anthropic's $16.8 billion Q3 revenue implies slowing growth, and a Gartner report that $3,5 trillion of AI infrtastructure spending could be exposed to impairment by 2030 is making the rounds. Bonds rally across the curve in a bull flattener with yields down 7-11bps, as the AI selloff pushes investors into havens and odds of an October Fed hike slide back to around 30% from a post-CPI intraday peak of 58%; bunds and gilts also rally about 10bps, helped by the pullback in energy. The dollar is lower, with the Bloomberg Dollar Spot Index down 0.3%-0.4% and the Swiss franc leading G-10 gains while the Aussie slumps after a weak jobs report. In commodities, Brent drops almost 2% to $104 on the risk-off tone and talk of the US easing shadow fleet sanctions, gold jumps 1.3% to $4,158 and silver is up 2.1%, while copper slides. Bitcoin is down 0.6% near $81,200. US economic data slate includes September retail sales, PPI, October Empire manufacturing and Philly Fed, and weekly jobless claims (all 8:30am) and August business inventories (10am). Fed speaker slate includes Goolsbee (10am), Hammack (4:30pm) and Chair Warsh, who has a fireside chat with the IMF's Georgieva in Bangkok at 11:30pm ET before the blackout. Treasury sells $110 billion of 4-week and $105 billion of 8-week bills at 11:30am.

In premarket trading, Apple (AAPL) outperforms the group during the AI selloff (AAPL +0.8%, Microsoft -0.5%, Alphabet -0.8%, Meta Platforms -1%, Tesla -1.4%, Amazon -1.8%, Nvidia -1.6%)

  • Chipmakers and other AI-related firms slide after Anthropic disclosed third-quarter revenue that likely slowed from the previous quarter. Among notable movers: CoreWeave (CRWV) -3%, Dell (DELL) -4%, Micron (MU) -4%, Intel (INTC) -3%, Marvell (MRVL) -4%, AMD (AMD) -3%, Broadcom (AVGO) -2%
  • AngloGold Ashanti (AU) rises 3% after Goldman Sachs initiated coverage at buy, citing increased central-bank purchases that should support gold prices. Gold is also higher on Thursday morning.
  • Cirrus Logic (CRUS) slips 2% after being downgraded to sector weight at KeyBanc, which sees a weak outlook for the Apple supplier.
  • FMC Corp. (FMC) sinks 27% after the agricultural chemicals firm cut its third quarter outlook.
  • Fortrea Holdings (FTRE) gains 3% after Deutsche Bank upgraded the health services firm to buy, citing potential for revenue growth and margin expansion.
  • Kimberly-Clark (KMB) climbs 3% after the household products company reported preliminary net sales for the third quarter that met the average analyst estimate.
  • Penske Automotive Group (PAG) climbs 8% after entering a deal to be taken private for $212 per share in cash by Penske Corp. and Mitsui.
  • Quantinuum (QNT) rises 3% as Morgan Stanley upgrades to overweight, saying the stock offers the most attractive valuation among peers.
  • Rocket Lab (RKLB) falls 11% after adjusting the target launch timing for its Neutron medium-lift rocket, with the vehicle’s inaugural launch now expected to occur in 2027.
  • Walmart (WMT) gains 2.8% after Deutsche Bank upgraded the retailer to buy, citing a favorable setup into 2027.

In other corporate news, the US FTC has subpoenaed Anthropic and OpenAI seeking documentation in relation to safety incidents and privacy policies, Axios reports, just as the AI sector needed one more thing to worry about. IDC said the smartphone market suffered its worst decline on record in the September quarter, with rising memory costs pushing shipments down 22% and "the worst is yet to come." Rocket Lab drops almost 10% after delaying the inaugural Neutron launch to 2027, while IonQ filed to offer about $2 billion in shares and warrants. Barclays analysts said a Tesla-SpaceX merger has become widely expected and an announcement could come before Tesla's annual general meeting. Marsh will shoulder a larger share of the CS-Greensill settlement, the FT reports; EasyJet shareholders are being asked to support an Apollo takeover proposal; VW is pivoting to trucks and rugged SUVs in a quest for US profit; and Iambic Therapeutics raised $150 million in a US IPO priced at the midpoint. Schwab, Marsh McLennan, US Bancorp, PNC, BNY and Prologis report before the open, with Interactive Brokers, Alcoa and JB Hunt after the close.

The global AI unwind is gaining momentum: negative headlines are piling up, from signs of Anthropic's slowing growth to CoreWeave bonds plunging into distress and Gartner's warning that $3.5 trillion of AI infrastructure spending could be at risk of impairment by 2030. Even good results from TSMC - a Q4 revenue guide of $52.3-54.3 billion against a street at about $50 billion - failed to dispel the concerns, and a global selloff in semis dragged South Korea's benchmark down nearly 8% into a bear market, while the SOX is down 12% over the past six sessions, as Goldman warned of a semi "air pocket" last week.

As discussed last night, Anthropic's pre-IPO investor event failed to impress as the revenue growth shared was well below the double digit growth observed earlier in the year. “In any normal world, companies would kill for 45% q/q growth,” said Vital Knowledge founder Adam Crisafulli. “But in the land of AI, where investors are used to parabolic figures, a slowdown in growth undercuts sentiment.”

The market is especially worried about the financing model of neocloud companies, which are borrowing huge amounts at high rates to build data centers. CoreWeave's 5Y CDS closed at 1,118bps yesterday, up a massive 136bps, and its debt due 2032 dropped below 78 cents on the dollar - paper investors bought at par just four months ago! CoreWeave, for its part, said it isn't worried about the market's reaction and wants access to "unlimited" pools of money (what could go wrong). Meanwhile, hyperscaler capex is expected to total more than $3 trillion over the next three years, which is a lot of money to finance with 10Y yields north of 5%.

“AI stocks in EM will be the first to go, given their outperformance this year,” said Vey-Sern Ling, a managing director at Union Bancaire Privee. “Higher rates and USD also hurt EM tech disproportionately.”

“The market is juggling a number of risks at the moment, notably geopolitical, which is fueling oil prices and in turn inflation and monetary policy,” said Roland Kaloyan at Societe Generale. Some investors “are looking to take profits and rotate out of the semiconductor trade. With yields where they are today, bonds are becoming increasingly attractive.”

That said, yesterday's hot CPI hasn't gone away: headline CPI rose 0.65% m/m and core 0.335% vs 0.2% expected, briefly lifting October hike odds above 50% before the AI rout unwound the entire move. Deutsche Bank's Henry Allen thinks the market is too complacent.

“The 50 risk is live,” Henry Allen, macro strategist at Deutsche Bank Research, said in an interview with Bloomberg TV, warning that the more the Fed stays behind the curve, “the risk is they have to play catch up.” Markets are grappling with offsetting forces, “where AI is pushing down the one side, CPI is pushing up on the other, but the risks are definitely on the hawkish side.”

JPM's Market Intel desk under Andrew Tyler stays Tactically Bullish, noting the two big questions yesterday were the reversal in bond yields and how much longer the tech selloff can run. On the former, the team blames a market that clearly overreacted when October hike odds jumped above 50%, a move into quality and safe assets, and "concern about a possible AI-related credit event." On tech, the SOXX fell for a seventh straight day; with JPM's TPM positioning at a neutral ~46th percentile vs ~19th near the late-July lows, the desk sees potential for further de-grossing into key tech catalysts, but says "we remain constructive on the sector and still see a possible opportunity to buy the dip." JPM FX sales' Steve Bruner put it more colorfully: "Have rates finally crossed the AI Rubicon? My instinct is Not Yet."

Goldman's desks spent the night counting casualties. In London, Rich Privorotsky writes that the GS global neocloud basket is down 20% in five sessions, "a roughly 1st pctl move over ten years", adding that "in hindsight, the pain trade was long AI/ short bonds. Now we're watching both sides unwind." His conclusion: "the market is discovering that demand for compute can grow exponentially, but the capital available to finance it cannot." Praneet Shah echoes that "the cost of financing the AI buildout is starting to collide with how much the market can comfortably absorb", while Gen Sales' Dioni Ellinikaki notes that in an increasingly debt-funded capex cycle, "access to credit is becoming the key constraint rather than AI adoption itself." On the damage: GS Prime shows TMT-focused funds lost 2.7% on the day (a -2.6 standard deviation move), and the TMT desk's info-tech sell skew was the highest in more than four weeks. In Asia, Rachel Hu notes the TAIEX saw a record ~$9.3 billion foreign outflow, yet market color "suggested limited capitulation versus the July selloff" — a polite way of saying there may be more to come.

In Europe, French bonds remain in focus: the OAT-bund spread widened 1bp to 142bps, just shy of Monday's closing peak, as France sold €12 billion of bonds at the top of its target range. Former ECB chief Mario Draghi said the ECB is unlikely to step in any time soon with market intervention to help France, setting a high bar for the TPI.

In Europe, the Stoxx 600 is down 0.1% at 637.05, with 225 members down and 369 up, as investors turn to defensive sectors while the global tech selloff gathers pace; telecoms, food & beverage and insurance lead, while tech, basic resources and industrials lag. The FTSE 100 is up 0.5% thanks to its low tech exposure, while the Euro Stoxx 50 drops 0.6% and the DAX is down 0.3%. ASML falls 5.5%, ASM International 9.1% and BE Semi 6.1%; JPM notes Semis, AI Data Centers and Momentum Longs baskets are showing 1-3z moves, while AI Disruptions and Luxury outperform. Here are the biggest European movers:

  • Ericsson shares surge as much as 11% after the 5G gear maker reported sales and profits ahead of expectations, driven by its core networks business and projects in Japan and India.
  • Pernod Ricard shares gain as much as 4% after analysts broadly welcomed the beverage maker’s first-quarter results, noting improved momentum in the US and China and signs the quarter marked a low-point for the company.
  • THG surges as much as 17% after the nutrition and beauty company upgraded its profit guidance, which Peel Hunt says is likely to trigger increases to consensus estimates.
  • EQT rises as much as 4.7% after the alternative investment firm reported an increase in assets under management driven by Coller Capital, which the firm acquired earlier this year.
  • Dunelm gains as much as 7.6% after analysts said the UK home-furnishings retailer’s first-quarter trading update was better than analysts had expected, driven by a recent sales improvement.
  • TotalEnergies shares rise as much as 1.1% after the French energy company published its 3Q trading statement. Analysts tout strong refining margins while oil and gas production and LNG also performed above expectations.
  • DocMorris shares rise as much as 9.4% after the online pharmacy delivered “long-awaited” positive adjusted Ebitda in the third quarter and raised its guidance for the full year.
  • European semiconductor stocks sink on Thursday as Anthropic’s sales growth failed to impress investors that have grown more anxious about the sustainability of AI spending.
  • Entain slides as much as 3.8% after posting softer online net gaming revenue growth due to unfavorable sports results in Italy and a provisional ban on online gambling in Brazil.
  • Workspace shares fall as much as 9.8% after the UK flexible-office landlord said its target of an additional £100m+ of disposals is unlikely to be fully achieved by March 2027.
  • Alfa Laval drops as much as 4.2% as Nordea downgrades its rating on the Swedish industrial equipment maker to hold from buy on a more balanced risk-reward following recent strength in the shares.
  • Kinnevik slides as much as 11% as DNB Carnegie says the Swedish investment company’s third-quarter unlisted net asset value came in “clearly below” expectations.
  • Mining stocks fall across Europe, driven by industrial metals amid a global selloff in the artificial-intelligence trade.

Asian stocks slumped as the semiconductor selloff deepened on concerns over AI financing, with the MSCI Asia Pacific Index falling as much as 3.3%, the most since July 28, and its tech subgauge sinking as much as 7.1%; Samsung Electronics, SK Hynix and TSMC were the biggest drags. South Korea's Kospi plunged 7.6%, triggering Level 1 circuit breakers for the first time since July 29 and entering a bear market, as Samsung fell 9.5% and SK Hynix 11.1%, with foreigners net sellers for an 8th straight session. Japan's Nikkei sank 4.9%, its worst day since March, while Taiwan's Taiex fell 3.4% on a record ~$9.3 billion of foreign selling. China's CSI 300 dropped 2% and the Hang Seng lost 1%, while Australia's ASX 200 held up relatively well as financials and defensives offset weakness in tech and miners. India's Nifty bucked the trend, rising 1.9% on rotation and lower crude. Asian central banks stepped in to support their currencies, with Taiwan's state banks selling dollars and the RBI and Bank Indonesia intervening.

In FX, the Bloomberg Dollar Spot Index is down 0.3%-0.4%, giving back the post-CPI spike as US yields fall; the DXY trades in a 101.87-102.39 range after hitting its highest level since May 2025 on Wednesday. The Swiss franc leads G-10 gains, with USD/CHF down 0.6% to 0.8297, while EUR/USD rises 0.5% to 1.1212 and cable is up 0.4% at 1.325, shrugging off a better-than-expected UK August GDP print. The Aussie is the laggard, down 0.6% to 0.6930 after an unexpected contraction in September employment pushed the jobless rate up to 4.7%, prompting traders to scale back RBA hike bets. USD/JPY edges up 0.2% to 158.0.

In rates, Treasuries extend their advance across the curve in a bull flattener as investors seek havens amid the slump in technology stocks, with the 10-year yield down 10bps to 5.08%, the lowest since Sept. 23 - and a far cry from the 5.33% hit right after yesterday's CPI print. The 2-year yield is down about 8bps at 4.72% after having spiked as much as 16-20bps intraday on Wednesday, while the 30-year falls 7bps to 5.45%. If the rally continues, the Sept. 23 session was the last time a sub-5% 10Y was seen (and for the record, we are still some way off the 5.365% early-October peak). Bunds rally, led by the belly, with the German 10Y falling 10bps to 3.37%, the lowest since Sept. 8, as money markets pare ECB hike bets and no longer fully price three increases by end-2027; gilts jump with the UK 10Y down 9bps to 5.33%, ignoring the GDP beat. Spain sold €5.4 billion and France €12 billion of bonds. In the US, Treasury sells $110 billion of 4-week and $105 billion of 8-week bills at 11:30am, with the focus on PPI and retail sales and then Chair Warsh's final word before the blackout.

SMBC Nikko's Makoto Noji thinks the 10-year yield may be topping out: Wednesday's move was a rare return to the "textbook" pattern - stocks fell and the 10-year yield declined as the curve twist-flattened - which may signal long-term yields are close to peaking, as lower stock prices could prompt higher-income households to rein in spending. Not everyone is convinced; Bloomberg's Vassilis Karamanis argues the move is less a haven trade than a rates trade, with Treasuries rallying "because the tightening already embedded in yields starts doing some of the Fed's work."

In commodities, WTI November is down 0.2% at $94.92 (in a $93.58-95.31 range) and Brent December slides 1.9% to $104.06 (in a $103.64-105.83 range), as the equity selloff pushes investors away from risky bets and the Trump administration considers easing sanctions on shadow fleet vessels to bring down record-high freight rates. That is overshadowing escalation risk: CNN reports the US military has drawn up new strike plans that include potentially using the "mother of all bombs" against Iranian energy and nuclear sites, Ukraine's Zelenskyy has ordered strikes on Russian refineries to resume and a drone strike set the Ryazan refinery on fire overnight, while a cargo ship sank in the Strait of Hormuz after a strike. API data showed an 11.1 million barrel crude draw (vs. a 1.9 million build expected); the delayed EIA report is out at noon and WTI November options expire today. Dutch TTF slips toward €85/MWh. Spot gold rises 1.3% to $4,158 on haven demand and the softer dollar, silver gains 2.1% to $56.72, while LME copper trades near the bottom of a $14,320-14,480/t range.

US economic data slate includes September retail sales, PPI final demand, October Empire manufacturing and Philadelphia Fed business outlook, and initial jobless claims (all 8:30am), August business inventories (10am) and the September federal budget balance (2pm). Fed speaker slate includes Goolsbee (10am) and Hammack (4:30pm), with Chair Warsh in a fireside chat with the IMF's Georgieva at 11:30pm ET.

The IMF-World Bank meetings continue in Bangkok, EU leaders meet for a summit in Brussels, and SEMICON West wraps up in San Francisco.

Market Snapshot

Top Overnight News

  • Nasdaq futures fell as a plunge in chip stocks deepened the equity selloff and extended the AI trade pullback. South Korea’s Kospi sank almost 8%, entering a bear market. BBG
  • TSMC bucked the gloom with an upbeat outlook, yet failed to dispel rising concerns about the sustainability of a global AI buildout. The chipmaker is considering expanding in Texas and confirmed talks with Elon Musk’s Terafab about capacity. BBG
  • Anthropic PBC told prospective investors its third-quarter revenue hit $16.8 billion, according to people familiar with the matter, as the artificial intelligence company pushes ahead with plans to go public. BBG
  • CoreWeave shares plunged as much as 17% on Wednesday, while its debt due in 2032 dropped to less than 78 cents on the dollar, after investors bought it at par four months ago. BBG
  • US FTC has subpoenaed Anthropic and OpenAI, seeking documentation in relation to safety incidents and privacy policies; plans to compel executives to testify: Axios
  • Asian central banks stepped in to support their currencies as stocks dropped. State-owned banks in Taiwan sold US dollars and the RBI supplied greenbacks in onshore and offshore markets, traders familiar said. Bank Indonesia intervened to steady the rupiah. BBG
  • IDC said that the smartphone market suffered its worst decline on record in the September quarter. Rising memory costs pushed shipments down 22%, and “the worst is yet to come,” the research firm said. BBG
  • The Fed’s Mary Daly told Reuters that further rate hikes are probably needed, but there’s no urgency. Her Chicago colleague Austan Goolsbee called Wednesday’s US inflation report “discouraging.” BBG
  • Deutsche Bank sees a growing risk that the Federal Reserve will need to raise its benchmark rate by 50 basis points in a single move in coming months if it delays tightening policy while inflation remains elevated and economic growth holds up. BBG
  • The US military has developed new strike plans that include potentially using the so-called “mother of all bombs” to target Iranian energy infrastructure and nuclear sites should President Donald Trump give the order to resume combat operations either before or after the midterm elections, according to multiple US officials familiar with the matter. CNN
  • The Trump administration is considering easing sanctions on so-called shadow fleet vessels that have transported oil and petroleum products from countries including Russia, Iran and Venezuela, in an effort to reduce record-high global freight rates, a US official said on Wednesday. RTRS
  • President Volodymyr Zelenskyy has said Ukraine will restart strikes on Russia’s oil refineries as he expressed anger over a “dangerous” withdrawal of US intelligence and simultaneous weakening of Starlink satellite internet service at a time of intense Russian attacks. FT
  • The US has proposed that European countries unfreeze some Russian sovereign assets immobilized after Moscow’s invasion of Ukraine and transfer them to a vehicle overseen by Washington in an attempt to revive peace talks. FT
  • The European Central Bank is unlikely to step in any time soon with market intervention to help France, according to its former chief, Mario Draghi. BBG
  • Bank of England policymaker Megan Greene says the UK should raise interest rates to lean against the risk of significant second-round effects from high energy prices. BBG
  • UBS is mapping out contingency plans to move its HQ from Switzerland if Swiss lawmakers proceed with tougher capital requirements under the country’s too-big-to-fail banking laws: WSJ
  • White House Council of Economic Advisers Chair said referring to the inflation report that this is not a good month and that Bureau of Labor Statistics data is reliable.
  • Trump administration's investigation into Rep. Omar is aimed at building a case to strip her of her US citizenship and ultimately deport her, according to US officials and other people familiar with the probe: WSJ
  • Goldman's global neocloud basket is down 20% in five sessions, "a roughly 1st pctl move over ten years," while hyperscaler IG spreads widened another 7.4bp last week. GS
  • JPM's Feroli sees September PPI at +0.5% m/m headline and +0.3% core, and retail sales +0.4% with the control group +0.2%, both on strength in Chase card data. JPM

A more detailed look at global markets courtesy of Newsquawk

APAC stocks were lower across the board as the sell-off rolled over into the region following the losses stateside owing to the tech rout and hot CPI data. ASX 200 was slightly lower but with the downside limited as underperformance in tech and miners was offset by resilience in financials, telecoms and defensive sectors, while disappointing jobs data further lessened the likelihood of the central bank hiking rates again next month. Nikkei 225 slumped by more than 3000 points, with double-digit losses seen in several tech stocks. KOSPI was the worst performer and triggered circuit breakers after dropping as much as 8% owing to its large tech exposure and the ongoing bloodbath in the sector. Hang Seng and Shanghai Comp conformed to the broad-based tech-driven weakness, with recent stronger-than-expected lending data doing little to spur risk sentiment.

Top Asian News

  • Chinese Premier Li said regarding New Yalu River Bridge, which connects China and North Korea, said opening of the bridge will strongly promote economic and trade cooperation and further strengthen personnel exchanges.
  • South Korea and Japan extend their currency swap agreement, Yonhap reported.

European bourses (STOXX 600 -0.2%) point to a mixed picture, with so-called defensives (FTSE 100 +0.3%, SMI +0.4%) outperforming while cyclical-heavy indices (DAX 40 -0.3%, AEX -0.9%) underperform, primarily driven by the continued selloff in chip and memory names. Sectors have a slight positive tilt. Telecoms lead, with Food, Beverages & Tobacco and Insurance rounding out the sector gainers. Unsurprisingly, Tech is the sector laggard, with Basic Resources and Industrials following behind. US equity futures are mixed, with the NQ and ES being weighed on by tech names. AI funding has returned as a worry for investors, with the Broadcom CEO recently highlighting concerns about AI buildout financing. Additionally, CoreWeave has been pressured, with shares plunging 15% in the prior session (-6% pre-market) as it has been heavily reliant on the high-yield debt markets to finance its build out. TSMC EARNINGS: TSMC earnings failed to result in a rebound in the tech space, despite a better-than-expected revenue outlook. In brief, Q3 net income topped estimates while gross margin printed a tick lower than consensus. The chipmaker projected Q4 sales as much as USD 54.3bln (exp. USD 48.8bln), which should result in a c. +44% rise in 2026 revenue in USD. Following the Q3 release, analysts at Saxo Markets see this as a much-needed vote of confidence in the AI demand story, amid a selloff triggered by growing signs of stress.

Top European News

  • UK Chancellor Healey said he will follow IMF advice to stick to deficit reduction plans in October 28th Budget.
  • UBS (UBSG SW) is mapping out contingency plans to move its HQ from Switzerland if Swiss lawmakers proceed with tougher capital requirements under the country’s too-big-to-fail banking laws, according to WSJ.

FX

  • G10s are mostly firmer against the USD, which is under mild pressure this morning. The Aussie is the clear underperformer following a weak jobs report, whilst the CHF holds at the top of the pile, on narrowing yield differentials and the broader risk-off tone.
  • DXY is currently trading with modest losses, giving back some of the strength seen in the prior session; as it stands the index holds within a 101.87 to 102.39 range. Pressure which appears to be a pull back from the prior day’s post-CPI gains, and as US yields falter, amidst the latest tech sell off. Overnight, the likes of SK Hynix and Samsung Electronics sank in excess of 11%, with investors worried about AI spending sustainability, and most recently, default concerns related to CoreWeave.
  • The selling pressure also comes in the aftermath of a hot US CPI report, which only further exacerbates credit concerns and expectations of tighter conditions ahead. Money markets currently assign a 27% chance of a hike in October, and 90% by December 2026; a few sell-side banks have also brought forward their calls of a hike by year-end vs previously viewing a hold.
  • Aussie (-0.6%) is the clear underperformer this morning, and currently holds at the lower end of a 0.6936 to 0.6980 range. This comes after a very poor regional jobs report, which showed an unexpected contraction in headline Employment Change, which was solely due to part-time work, while the Unemployment Rate rose, although it coincided with a fall in the Participation Rate. A report which saw money market pare back their bets of a hike in November (16%); c. 40% chance of a hike is assigned by year-end.
  • CHF (+0.6%) is the outperformer this morning, joined closely by the EUR (+0.5%) and GBP (+0.5%), all benefiting from the broader USD pressure. The Swiss Franc cheers narrowing yield differentials, whilst the GBP counts down the days to the UK Budget (Oct 28th).
  • On that note, recent source reports about Chancellor Healey’s plans have been taken in the market’s stride. Most pertinently, he 1) does not intend to equalise income tax and CGT, 2) will fund the package without fresh borrowing. Into the Budget, the August GDP M/M reading saw the UK grow 0.1%, topping expectations of -0.1%, but beneath the prior 0.4%. So whilst Healey will welcome the growth in August, the slight slowdown will no doubt lessen some of the breathing room he would have liked to have. Cable kneejerked higher on the series itself, but then pared back given it has little impact on monetary policy in the near-term. On this subject, a couple of BoE members have spoken today; Greene reiterated that she sees risks of second round effects as “pretty significant”, whilst Breeden questioned whether the energy shock is gone or just delayed. A stark contrast between the two MPC members. GBP/USD currently holds within a 1.3186 to 1.3259 range.

Central Banks

  • Fed's Daly (2027 voter) said we are more likely than not to need more rate hikes, but still deliberating on timing, adds not in a posture of urgency and better to be thoughtful and deliberate. Reassuring that after markets' initial 'robust' reaction to CPI data, markets are calmer. Markets understand the Fed's reaction. CPI showed gas prices are driving headline inflation, while core inflation remains sticky, as expected. Feels imprudent to react when there is time to make a good decision. Don't know yet if inflation will come down as shocks abate or worsen if shocks persist. Risks to above-target inflation remain elevated; stable labour market means the Fed can focus on price stability. The Fed has a responsibility to communicate effectively and be accountable, transparent and clear.
  • US President Trump said the Fed has interest rates artificially high.
  • UBS expects the Fed to hike for a third time in March 2027 (prev. saw hiking cycle to end in December).
  • BoJ Board Member Koeda said she believes that the bank should adjust the policy interest rate in a timely manner with an eye on the economic and price situation, while keeping in mind the estimated range of the neutral interest rate. The monetary environment has been accommodative; no pace of hikes in mind, sees neutral rate "significantly" above 1%.
  • ECB's Kazaks said that there is no immediate rush on interest rates, inflationary pressure remains strong in the near term.
  • ECB's Pereira said yields rise is more related to fiscal issues, adds good news is that inflation is not spreading and if inflation starts broadening, central banks will be forced to act. Growth is surprising on the upside and wouldn't be surprised if it continued in the next few months.
  • ECB's Dolenc said don't see second-round effects yet and the labour market isn't so tight anymore, adds must be vigilant on inflation data. Approaching a restrictive policy stance. ECB may not have to do much if markets tighten and have tools including TPI which will be used if needed.
  • BoE's Breeden said are looking to whether the energy shock is gone or just delayed; the loosening of the labour market hopefully means that there will not be wage price pressure like in 2022.
  • BoE's Greene said the risks of second-round effects are quite significant.
  • BoE's chief economist Pill said should not give impression that hike now would be at the start of a series of increases.
  • RBNZ Chief Economist Conway said New Zealand is feeling the effects of oil price shock, while he affirm's direction of the OCR is most likely up and the next OCR decision is wide open.
  • PBoC Governor Pan attends China-GCC Central Bank Governors' Meeting, while the PBoC and Qatar Central Bank renew FX swap agreement.
  • PBoC injected CNY 45bln via 7-day reverse repos with the rate at 1.40%.
  • PBoC set USD/CNY mid-point at 6.7253 vs exp. 6.6977 (prev. 6.7249).
  • SARB Governor sees upside risks to inflation to remain, adding that he expects CPI to return to the 3% target only in 2028; policy rates are moderately restrictive and consistent with the outlook.

Fixed Income

  • In short, the post-CPI rebound continues as the tech/AI selloff extends and a FTQ ensues.
  • USTs at a 105-18 peak, firmer by 22 ticks on the day already into PPI, retail sales and Fed speak. Taking USTs to the highest since the 23rd of September, when 106-08+ printed. Amidst this, yields are lower across the curve with the 10yr down by 10bps on the day, at a 5.08% low; if the move continues, it is worth reminding that the referenced 23rd September session was the last time a sub-5% US 10yr yield was seen. For context, we are some way off the 5.365% early-October peak.
  • Bunds in-fitting with drivers much the same, and ECB speak and data prints having no real impact on the market thus far. Price action that has lifted Bunds to a 121.92 peak, firmer by 96 ticks at best; though, for what it is worth, the peak hit in APAC trade (in slight contrast to USTs) during the worst of the South Korea selloff.
  • Gilts opened higher by just over 50 ticks before extending to gains of exactly a full point on the day, hitting 84.91 and the highest since October 2nd. A move driven by the above FTQ. No real followthrough to the UK’s GDP data, as while better than expected this was essentially due to favourable service revisions in the last two periods, and a stagnate service picture in August, as opposed to any surprise growth. While the better-than-expected print is welcome, it does not change the narrative for policymakers.
  • Spain sells EUR 5.436bln vs Exp. 4.5-5.5bln 2.35% 2029, 2.60% 2031 and 3.55% 2033 Bono.
  • France sells EUR 12bln vs Exp. EUR 10-12bln 2.70% 2031, 0.00% 2031, 3.25% 2032 and 3.50% 2033 OAT

Commodities

  • WTI Nov and Brent Dec futures are softer amid the broader risk-off tone following the global tech sell-off and hotter-than-expected US CPI yesterday, with the complex also pressured by potential supply relief. Recent reports suggested the US is considering easing sanctions on shadow fleet vessels to boost oil flows, while Russian diesel could reach the US ahead of the November midterms. Nonetheless, geopolitics has subsided, with the US reportedly preparing fresh strike options against Iranian energy and nuclear facilities, while Houthi attacks on Saudi Arabia continue. Elsewhere, US private inventories yesterday showed a sizeable 11.1mln bbl draw in crude (exp. 1.9mln bbl build), although this provided little support amid the broader selling.
  • WTI resides in a USD 93.58-95.31/bbl range, while Brent declined within a USD 103.64-105.83/bbl range, albeit both off worst levels. Dutch TTF is softer alongside the broader pullback in energy prices, although underlying fundamentals remain bullish ahead of winter. TTF fell to the bottom of a EUR 85.00-87.80/MWh range at the time of writing.
  • Precious metals are firmer, with spot gold benefiting from haven demand amid the global tech sell-off, alongside a softer DXY and lower global yields despite yesterday's hotter-than-expected US CPI. Spot gold is firmer within a USD 4,100-4,162/oz range, while spot silver also gains, within a USD 55.49-56.37/oz range.
  • Base metals are softer amid the broader risk-off tone, with copper pressured by the sharp sell-off in global equities, particularly Asian tech stocks, with the KOSPI suffering the most, alongside concerns over further Fed tightening following the US CPI report. 3M LME copper trades close to the bottom of a USD 14,320-14,480/t range.
  • Chinese State Planner said that domestic gasoline and diesel retail prices will not be adjusted on Oct 15, 2026.
  • Chile's state miner CODELCO called a shareholders meeting for November 5th to review production inconsistencies in 2024 and 2025.
  • US Weekly Private Inventory Data (bbls): Crude -11.1mln (exp. +1.9mln), Gasoline +1.1mln (exp. -0.8mln), Distillate -1.5mln (exp. -2.0mln), Cushing +1.8mln.
  • Russian Deputy PM Novak says that "a number of countries, not just the US, are interested in purchasing Russian diesel fuel"

Trade/Tariffs

  • Japanese Trade Minister Akazawa said Japan and US agree on first chip project under USD 550bln investment plan, while he added that chip project has great significance in AI era and they remain strongly committed to last year's trade deal. Latest chip project is to enhance Japan and US ties further. Collaborating on chip supply is key for economic security.

Geopolitics: Middle East

  • US is considering using "mother of all bombs" against Iran, according to source cited by CNN.
  • US President Trump reiterated that the war with Iran will end soon and fuel prices will drop shortly, adds Iran issue will be resolved quickly.
  • US President Trump said we have complete control of the Strait of Hormuz and are extracting more oil from it than ever before, while he stated that Iran was two weeks away from acquiring a nuclear weapon before we struck their sites. This matter in Iran will end very soon, and when it ends, gasoline prices will drop to levels even lower than they were before the start of military operations.
  • US is reportedly discussing lifting some sanctions on shadow fleet vessels in attempt to lower global freight rates and boost oil flows in the Middle East, according to an official.
  • IRGC Spokesperson said attack on violating ships was a response to America's third breach of promise.
  • Saudi-led coalition says that a cruise missile has been intercepted in the Medina region, Al Hadath reports; Yemeni Army Spokesperson says Forces did not target Saudi's Medina, and these claims is a great falsehood.
  • Houthis are developing their own advanced ballistic missiles that could reach Saudi Arabia and Israel using Chinese delivered parts, according to New York Post.
  • Houthi media official called on Taiz residents to stay inside their homes.
  • Yemen's air defences downed a Saudi Typhoon warplane in the skies over Saada in Yemen, according to Fars.
  • Arab sources report hearing several explosions in Yemen's capital, according to Tasnim.
  • Saudi-led coalition said it intercepted and destroyed a drone in the kingdom's eastern region.

Geopolitics: Ukraine

  • Ukrainian President Zelensky's top advisors spoke with White House counterparts on Wednesday and asked whether there'd be a decision to shut down Starlink services and what could be done to fix the situation, according to sources cited by Axios's Ravid. "A senior U.S. official said the Trump administration had nothing to do with the alleged Starlink service constraints. But Ukrainian officials remain suspicious".
  • US proposed European countries unfreeze some Russian sovereign assets in an effort to revive peace talks during discussions in Miami last week between Trump's peace negotiators and officials from Ukraine, France, Germany, UK, EU and NATO, according to FT. European delegates rebuffed the plan.
  • Ukraine President Zelensky said Ukraine will resume strikes on Russian refineries and expresses anger at a dangerous withdrawal of US intelligence sharing and weakening of Starlink satellite internet service, according to FT.
  • Dutch PM said that "we need to step up our game and make sure Ukraine wins the war".
  • Russia's Ryazan refinery was reportedly attacked overnight by drone.
  • Russia hits Ukraine's Izmail port and cargo vessels.
  • Japanese PM Takaichi said there is no such fact when asked whether Japan is conducting espionage in Russia.
  • UK Chancellor Healey called on other nations to stay the path regarding Russia sanctions and said tighter ban on Russia-linked shipping services is needed.

Crypto

  • Bitcoin (-3%) and Ethereum (-5%) slip alongside the broader risk tone.

US Event Calendar

  • 8:30am: Sep Retail Sales Advance MoM, est. 0.3%, prior 1.2%, revised 1.13%
  • 8:30am: Sep Retail Sales Ex Auto MoM, est. 0.5%, prior 1.4%, revised 1.28%
  • 8:30am: Oct Empire Manufacturing, est. 12, prior 7.6
  • 8:30am: Oct Philadelphia Fed Business Outlook, est. 28, prior 37.8
  • 8:30am: Oct 10 Initial Jobless Claims, est. 200k, prior 197k
  • 8:30am: Oct 3 Continuing Claims, est. 1709k, prior 1716k
  • 8:30am: Sep PPI Final Demand MoM, est. 0.6%, prior 0.4%
  • 8:30am: Sep PPI Ex Food and Energy MoM, est. 0.3%, prior 0.2%
  • 8:30am: Sep PPI Final Demand YoY, est. 5.4%, prior 5.4%
  • 8:30am: Sep PPI Ex Food and Energy YoY, est. 4.4%, prior 4.6%
  • 10:00am: Aug Business Inventories
  • 11:30am: US to sell $110 billion 4-week bills and $105 billion 8-week bills
  • 2:00pm: Sep Federal Budget Balance, est. -$30.0b, prior $197.9b

Central Bank Speakers

  • 10:00am: Fed’s Goolsbee Speaks in Kyla’s Newsletter Podcast Interview
  • 4:30pm: Fed’s Hammack Participates in a Moderated Discussion
  • 11:30pm: Fed’s Warsh in Fireside Chat with IMF’s Georgieva

DB's Jim Reid concludes the overnight wrap

Markets have just had an incredibly tumultuous 24 hours, as a strong US CPI print was then followed up with mounting fears around the AI trade. Indeed, you can see the story of the day from the huge turnaround in bond yields, with the 10yr Treasury yield initially surging to 5.33% after the CPI print, before paring that all back to close at 5.19%, and this morning it’s now down another -8.4bps to 5.10%. Meanwhile for equities, the developments pushed the S&P 500 (-1.11%) to its worst performance since July, and futures on the index are down another -0.50% this morning. Moreover, there’s been a huge selloff in Asia overnight, with the KOSPI (-7.04%) and the Nikkei (-5.08%) both slumping, and the KOSPI even saw a circuit breaker triggered earlier given the scale of the declines.

In terms of the catalysts, several names most exposed to AI have already been under mounting pressure in recent days. For instance, we mentioned in yesterday’s edition how CoreWeave’s 5yr CDS contract went over 1000bps intraday on Tuesday, highlighting how nervous some credit investors were about the company’s leverage profile. But yesterday, their CDS was then up another +136bps, closing at 1118bps, and the company’s share price fell -15.46% on the day. Moreover, this pressure started to be noted more widely, particularly among those firms that have been heavily scrutinised by credit investors given their large capex needs. So this led to big losses elsewhere, with Oracle (-8.83%) posting its largest decline since June, whilst the Philly semiconductor index (-4.30%) posted a 6th consecutive decline for the first time in over a year. In fact, that now leaves the index down -11.6% over those 6 sessions.

Those trends have shown no sign of letting up overnight, with significant moves in Asia this morning. That’s been most obvious for the KOSPI (-7.04%) and the Nikkei (-5.08%), but we’ve also seen sharp losses for the CSI 300 (-2.00%), the Shanghai Comp (-1.98%) and the Hang Seng (-1.47%) as well. Some of the individual names have seen even bigger losses, including SK Hynix (-11.28%) and Samsung (-9.91%). And looking forward, there’s no sign of the moves stabilising in the US and Europe, with futures on the NASDAQ 100 down another -1.08% this morning.

All that was exacerbated by a strong US CPI print yesterday, which led to mounting expectations about Fed rate hikes, adding to the pressure on some of these names. To be fair, the print was already expected to be a strong one given the recent rise in energy prices. But when it came out, headline CPI was at +0.649% on the month (vs. +0.6% expected), meaning it was just a whisker away from rounding up to +0.7%, and it pushed the year-on-year number to +3.7% as well. Moreover, the details didn’t look promising either, as core CPI was at +0.335% on the month (vs. +0.2% expected), taking the year-on-year number to +2.6% (vs. +2.5% expected). So this wasn’t just an energy surge driving prices higher, as there were broad-based moves across the consumer basket.

For markets, the clearest impact was on Fed pricing, as it immediately drove fresh speculation about an October rate hike. Beforehand, that had been priced at only a 22% chance, partly because multiple Fed speakers had steered away from it in the last couple of weeks. But after the CPI print came out, that then surged to an intraday peak of 58%, and it spent around half an hour above the 50% mark. Nevertheless, the AI fears and the broader risk-off tone have seen that move almost entirely unwind since, with futures now pricing in just a 27% chance of an October hike this morning, not much higher than before the CPI print even came out. So it just shows how much AI is dominating market attention right now, as fears over a broader tightening in credit conditions led to growing doubts about whether the Fed would actually move, despite the strong print. Indeed, US HY spreads (+11bps) ended yesterday’s session at 324bps, their widest since March.

With all that happening, US Treasuries saw some huge moves in the aftermath, with very large intraday ranges. For instance, the 2yr yield was initially up +16.1bps on the day, before paring that back to close only +0.8bps higher at 4.80%, and this morning it’s seen a sharp -7.8bps decline to 4.72%. Similarly, the 10yr yield initially surged to 5.33% after the CPI print but ultimately fell -2.3bps on the day to 5.19%, and has since fallen another -8.4bps overnight to 5.10%. And for the 30yr yield, there was initially a move up to 5.63%, before ending the day down -3.4bps at 5.52%, and this morning it’s down -7.2bps at 5.45%. The impact cascaded across other asset classes too, as there was initially a sharp appreciation of the US Dollar, but that’s also unwound entirely since, with the Euro strengthening +0.53% against the US Dollar this morning to $1.1215. More broadly, US equities were under pressure from both the inflation and the AI stories, but the small-cap Russell 2000 (-1.93%) took a particular hit, with the index entering correction territory yesterday, having now shed over -10% from its August peak.

Otherwise yesterday, oil prices rose slightly, with Brent crude (+0.35%) up to $106.06/bbl by the close. That came amidst no signs of progress in the US-Iran conflict, and the moves added to the inflationary concerns that had already mounted after the CPI print. However, the risk-off tone has dominated overnight, with Brent crude since down -1.75% to $104.20/bbl. Moreover, that’s despite Ukrainian President Zelenskyy saying to the FT that Ukraine would resume its strikes on Russian refineries.

Earlier in Europe, the continent’s assets put in a relatively better performance yesterday, albeit with a strong divergence across the board. For equities, there was strength in aggregate, with the STOXX 600 (+0.43%) up to a two-week high. However, there were gains for some like the FTSE 100 (+0.70%) and the CAC 40 (+0.58%), whereas Italy’s FTSE MIB was down -0.61%. Then for bonds, 10yr bund yields (-0.3bps) fell back slightly to 3.47%. But sovereign bond spreads widened, with the 10yr Franco-German spread up +4.1bps by the close to 141.5bps, just shy of its recent closing peak on Monday, at 142.3bps. And looking forward, equity futures are also pointing lower today, with those on the DAX down -0.49%.

Looking at the day ahead now, US data releases include PPI inflation and retail sales for September, the Empire State manufacturing survey for October and the weekly initial jobless claims. In Europe, we’ll also get UK GDP and Euro Area industrial production for August. Central bank speakers include the Fed’s Goolsbee and Hammack, along with the BoE’s Greene and Breeden. Finally, EU leaders will meet for a summit in Brussels.

Tyler Durden Thu, 10/15/2026 - 08:28

Bulgarian PM Stuns EU With Full-Throated Backing Of Trump-Putin Diesel Deal

Zero Hedge -

Bulgarian PM Stuns EU With Full-Throated Backing Of Trump-Putin Diesel Deal

Bulgaria has just broken ranks amid widespread European criticism over the Trump-Putin diesel deal announced last week, with the NATO country's Prime Minister Rumen Radev stunning Brussels in fresh remarks.

"You know what is our problem right now in Europe? High fuel prices," Radev said in English as he attended a two-day summit of leaders.

via The Associated Press

Reuters described of the top level meeting in Brussels, "the European Union began a packed summit on Thursday that quickly underscored wrangles over how ​to tame soaring energy prices, design a budget to keep the bloc competitive and curb surging exports from China that are blamed for job losses."

Prime Minister Radev told the summit "Any step in reducing fuel prices and to guarantee our competitiveness, we appreciate" - in a clear reference to the US-Russia diesel agreement.

And even as most continue to vocally support Ukrainian President Zelensky in his ongoing standoff with Trump and defiance of US wishes, Radev criticized Ukraine's strikes against Russia's oil refineries, again siding with the White House.

"I don't support strikes on any refineries," Radev said, at a moment Trump is strongly warning that Kiev better halt this tactic.

"I don't support strikes on any energy power plants, like Russian attacks on energy power plants in Ukraine, because this hits us back," he added. "The prices in Europe are (skyrocketing)."

Fellow European leaders voiced wide disagreement, with EU foreign policy chief Kaja Kallas echoing Zelensky's words that the diesel deal was a "gift" to Vladimir Putin.

"The question is: what has he (Putin) given in return? What we see is that he's actually increasing the attacks on civilians and civilian infrastructure. The ceasefire that was also announced is not really working on the Russian side," Kallas said.

The recently installed Radev, whose Progressive Bulgaria party won the April election, has been busy rolling back the NATO 'eastern flank' country's prior policy on Ukraine, including related to arms shipments.

The new government has made clear it has a new peace agenda, and its position is that nothing will be resolved by just pouring more heavy arms into the conflict, now in its fifth year. It was given a new mandate.

This was also notable amid the AfD's continued rise in Germany...

He has repeatedly criticized EU overreach on green-energy mandates, sanctions policies and what he describes as moral posturing in a "world without rules."

While analysts have lately noted he is unlikely to ultimately jeopardize the flow of EU funds that sustain Bulgaria’s economy, the result installs a distinctly Russia-friendly government at the heart of the EU's southeastern flank - a shift that has been drawing close scrutiny in Brussels, Washington and Kiev.

Tyler Durden Thu, 10/15/2026 - 08:20

Trump Admin Offers Migrant Children $3,000 To Voluntarily Leave US

Zero Hedge -

Trump Admin Offers Migrant Children $3,000 To Voluntarily Leave US

Authored by AG News Staff via American Greatness,

The Trump administration is offering unaccompanied migrant children $3,000 to voluntarily return to their home countries, expanding an immigration enforcement initiative aimed at protecting minors and reducing illegal immigration.

A Department of Homeland Security official confirmed Tuesday that migrant children ages 14 and older who are in federal custody and have no gang affiliations are eligible for the financial incentive.

The payment represents a $500 increase from the $2,500 offered last year under President Donald Trump's immigration crackdown.

DHS Secretary Markwayne Mullin is overseeing the initiative, which the department says is intended to protect vulnerable migrant children from exploitation and help reunite them with their families.

A DHS spokesperson told ABC News that Mullin is "leading efforts to rescue these children and stop their exploitation."

The administration has repeatedly raised concerns about the treatment of unaccompanied minors who entered the United States during former President Joe Biden's administration, particularly those placed with sponsors who may have criminal backgrounds.

"Many of the children who came across the border unaccompanied were allowed to be placed with sponsors who were smugglers and sex traffickers," a DHS spokesperson said.

"Unlike the previous administration, President Trump and DHS take the responsibility to protect children seriously and will continue to work with federal, state, and local law enforcement to reunite children with their families," the spokesperson added.

According to a legal services provider cited by ABC News, DHS began offering the increased incentive earlier this month.

The administration has also assembled a team of federal attorneys to represent migrant children in immigration proceedings after ending agreements with several immigration advocacy organizations that previously provided legal assistance.

The administration maintains that its immigration policies prioritize enforcement, child safety and family reunification as it works to address problems stemming from the previous administration's handling of unaccompanied migrant children.

Tyler Durden Thu, 10/15/2026 - 08:05

Europe Is Falling: Riots Spread From France And Belgium To Albania

Zero Hedge -

Europe Is Falling: Riots Spread From France And Belgium To Albania

Social unrest in France, Belgium, and now Albania raises the risk of riot contagion across Europe. Young rioters' involvement gives far-left groups opportunities to exploit grievances and channel them into broader anti-government mobilization.

Local outlets are reporting that "thousands of students," a common phrase MSM corporate media outlets have used to describe the rioters, took to the streets of Albania's capital for a second day of anti-government riots on Wednesday. They set fire to part of the education ministry and attacked other government buildings, yet this suggests the unrest has little to do with classroom sizes and more to do with a coordinated far-left anti-government movement sweeping across Europe.

Riot police deployed tear gas and water cannons to disperse unruly crowds. Kids dressed in all black, usually a sign of far-left involvement, also targeted the prime minister's office, the finance and interior ministries, and nearby businesses.

"The people are very angry at the system. They need to change everything. With this corruption all around, the crime and everything else is happening. And the people now are angry. They need to change the system," demonstrator Enida Bimi told Reuters.

We must ask ourselves, in a rational world: Is the solution to a failing education system to burn it down? Well, in the far-left mindset, certaintly. 

Deputy Prime Minister Albana Koçiu called for restraint yesterday, saying Albania "does not need to burn to change." Education Minister Mirela Kumbaro said the right to protest did not justify violence against public buildings and property.

Albania's state-run news agency said sixteen people were arrested "in connection with violent acts" during riots earlier this week.

The social unrest is less about education and demonstrates how Europe has a terrible disease of far-left extremism that has infected the youth. High-level State Department officials and their European counterparts discussed this concern last summer.

Europe is embarrassing itself on the world stage yet again. It's not just that the unrest is getting out of hand and spreading; its entire progressive utopia (welfare state) is cracking and now breaking as the end game nears. This warns all Americans that welfare states like France are headed for a fiscal crisis.

Read: "I Come From Your Future": A Frenchman's Warning To All Americans Voting Democrat

Tyler Durden Thu, 10/15/2026 - 07:45

Defiant Zelenskyy Resumes Russian Refinery Drone Strikes

Zero Hedge -

Defiant Zelenskyy Resumes Russian Refinery Drone Strikes

A defiant President Volodymyr Zelenskyy told the Financial Times on Thursday morning that Ukrainian forces will resume attacks on Russian refineries. The move certainly seems more political than anything else. Such attacks have been described as one of the drivers behind the global refining crisis, which has collided with Strait of Hormuz disruptions.

"The block [on attacking refineries] is out. We're done," Zelenskyy told the FT. He said Kiev had suspended energy strikes for three days at the Trump administration's request.

Even before that, the Trump administration had requested many times that Kiev stop bombing Russian refineries, but Ukraine remained mostly defiant and ramped up those attacks leading up to the US midterm elections. One can only wonder whether the escalation was politically motivated, worsening the diesel crisis and translating into consumer pain at US pumps.

Zelenskyy's new narrative is that the resumption of drone attacks on Russian refineries is a response to what he described as a "dangerous" cutoff of US intelligence sharing and the degradation of Starlink service.

Trump has denied cutting off intelligence sharing. Elon Musk said the US government controls Starshield's speed and usage limits, the military satellite network built on Starlink technology. Zelenskyy's office said Thursday that it had lifted the speed restrictions.

A growing rift is apparent between Zelenskyy and the Trump administration, as the Ukrainian president went on a media roadshow this week to push the narrative that he feels "betrayed" by Trump. Yet this should be seen as theatrics, a performative stunt by the former comedian who knows how to put on a good act before the US midterms. 

Last week, Trump said it was "time to get a new leader" after Zelenskyy ignored pleas to stop strikes on Russian refineries, one of the reasons why US diesel prices recently topped a national average of $6.50 a gallon.

Musk has openly agreed, saying on X, "I agree, time for Ukraine to get a new leader."

The breakdown in relations comes ahead of the Northern Hemisphere winter. The International Energy Agency warned yesterday that the "gasoil market balance will remain tight well into 2027."

Diesel prices in the US are back at their highs despite Trump's diesel deal with Moscow to add more barrels to the global market.

And now, the West heads into winter with a refined-products shock... 

Tyler Durden Thu, 10/15/2026 - 07:20

Teens Want More Monster Energy As Celsius Loses Its Fizz

Zero Hedge -

Teens Want More Monster Energy As Celsius Loses Its Fizz

Piper Sandler's latest Teen Survey of nearly 9,000 respondents offers an early read on energy drink preferences among younger consumers.

Analyst Michael Lavery highlighted Monster's growing appeal, noting that the brand is gaining share and leading rivals in consumers' intentions to increase consumption.

"Teens report highest consumption increase intent for Monster," Lavery wrote in the note published earlier today.

He continued:

We asked teens whether they intend to drink more or less of their favorite energy drink brands in the next six months; 20% plan to drink more while 49% plan to drink the same amount and 32% plan to drink less (though reduction intentions often do not actually occur).

Teens plan to drink more Monster (23%), than Alani Nu (20%), Red Bull (18%), and Celsius (16%).

The survey of roughly 8,935 teens showed Monster retaining second place among their preferred energy drink brands, behind Red Bull. Its share of mentions rose about .6 percentage points from a year earlier, reaching about 28%, broadly in line with its 27% share of measured US retail sales.

The results stand in sharp contrast with Celsius, which dropped from fourth to sixth and lost about 5.55 percentage points of preference share. Alani Nu remained third but also lost momentum among young consumers. 

Monster consumption is heavily skewed toward males: about 75% of teens who selected it as their favorite energy drink were boys. Alani Nu's following was mostly female, highlighting how differently the brands compete for younger consumers.

Other fun facts from the survey:

Energy drinks top soda and coffee for source of energy among young consumers.

Maybe the youngsters need some Hooked on Phonics ...

Monster's growing advantage over Celsius is showing up in stock performance this year.

Celsius is down 41% year-to-date, while Monster is up solidly at around 14.3%.

Tyler Durden Thu, 10/15/2026 - 06:55

Why Diesel Prices Are So Much Higher Than Gasoline

Zero Hedge -

Why Diesel Prices Are So Much Higher Than Gasoline

Authored by Robert Rapier via OilPrice.com,

  • Diesel has generally cost more than gasoline since 2004 due to higher production costs, taxes, and global demand.

  • Global refinery disruptions, export restrictions, and low inventories have widened the diesel price premium in 2026.

  • Strong US crude production and refinery output cannot fully offset global diesel supply shortages.

There was a time when diesel fuel was usually cheaper than gasoline in the United States. That relationship began to change about 20 years ago, and since then diesel has generally traded at a premium. Today, that premium is not just persistent but unusually large, which raises an obvious question: how did we get from gasoline typically costing more than diesel to diesel costing substantially more than gasoline?

The answer has two parts.

The first is structural and goes back to the mid-2000s, when changes in fuel specifications, taxes, refining economics, and global demand fundamentally altered the relationship between gasoline and diesel prices.

The second is more immediate. In 2026, refinery disruptions, geopolitical conflicts, low inventories, and reduced exports from major suppliers have pushed the global diesel market into an unusually tight position. Understanding the difference between those long-term and short-term forces explains both why diesel usually costs more and why the gap is so large right now.

Diesel Was Once The Cheaper Fuel

Before the mid-2000s, diesel was often cheaper than regular gasoline in the United States. There were exceptions, particularly during cold winters when heating-oil demand strengthened, but the longer-term pattern generally favored diesel. That began to change around 2004, and according to the Energy Information Administration, on-highway diesel prices have been higher than regular gasoline prices almost continuously since September of that year.

That shift is clearly visible in the historical data I examined in my 2023 article on the subject. In the decade before 2005, gasoline generally traded at a small premium to diesel. After that, the relationship reversed, and diesel became the more expensive fuel in most years. The timing is important because it coincided with a major change in the way U.S. refiners had to produce highway diesel.

Ultra-Low-Sulfur Diesel Changed The Economics

Beginning in the mid-2000s, U.S. refiners had to dramatically reduce the sulfur content of highway diesel. That was an important environmental improvement because sulfur emissions contribute to air pollution and acid rain, but it also made diesel more expensive to produce. Refineries invested billions of dollars in new hydrotreating and sulfur-removal equipment, and those investments increased capital and operating costs and made compliant diesel more expensive to produce and distribute.

My earlier article focused heavily on this transition because the timing lines up closely with the point at which diesel's historical discount disappeared. EIA now describes the persistent diesel premium as the result of several factors working together, including strong global demand for diesel and other distillates, the higher cost of producing low-sulfur diesel, and federal taxes that are six cents per gallon higher on diesel than on gasoline.

None of those factors explains every short-term price movement, but together they created a structural premium that had not existed to the same degree before 2004. Once diesel became more expensive to produce and more tightly linked to global distillate markets, the old relationship with gasoline never really returned.

Diesel Became A Global Commodity

Another important change has been the globalization of the diesel market. Gasoline is also traded internationally, but diesel and other middle distillates occupy an especially important role in the global economy because they power trucking, agriculture, construction, mining, shipping, industrial equipment, and heating systems. Strong demand in Europe, China, India, and the United States has kept pressure on global distillate balances for years.

That means U.S. diesel prices are increasingly influenced by events far beyond U.S. borders. Even when domestic production is strong, refiners can export diesel into higher-priced international markets, tying domestic prices more closely to global supply and demand. This is one reason it is misleading to look only at U.S. crude oil production and assume that abundant domestic oil should automatically translate into cheap diesel.

The United States can produce plenty of crude while still facing tight supplies of refined products. Crude oil has to be processed in the right refineries, into the right products, and then moved through the right transportation system. Those constraints matter just as much as the amount of oil coming out of the ground.

2022 Showed How Quickly The Premium Can Explode

The most dramatic recent example came in 2022, when Russia's invasion of Ukraine disrupted global energy markets. Diesel was hit particularly hard. Russia was a major supplier of crude oil, refined products, and feedstocks to Europe and other markets, so sanctions and trade restrictions forced a rapid reshuffling of global flows. Gasoline prices rose sharply as well, but diesel supplies tightened even more, pushing the diesel premium to record levels.

In my earlier article, I noted that the gasoline-diesel spread reached a record in 2022. At the time, the disruption from Russia explained why a structural premium suddenly became an extreme one. The market eventually adjusted as trade routes shifted, refinery operations stabilized, and inventories recovered, but that normalization did not last.

Why The Gap Is So Large Again In 2026

The current situation resembles 2022 in one important respect: global diesel supply has again been disrupted more severely than gasoline supply. EIA recently reported that global distillate supplies are tight because of reduced refining activity in Russia, China, and the Middle East. At the same time, U.S. refiners have been running near maximum utilization, with domestic distillate production averaging about 5.1 million barrels per day through August, the highest level since 2019.

That point is worth emphasizing because it shows that the current problem is not simply a collapse in U.S. refinery output. American refiners are producing large volumes of diesel, but global demand for those barrels has increased at the same time that supplies elsewhere have fallen. As exports increased, U.S. inventories declined, and by mid-September distillate inventories were about 13% below the five-year seasonal average even though summer is normally a period when inventories build ahead of winter.

Since then, the global situation has become even tighter. Russia has restricted diesel exports as refinery infrastructure has been damaged, China has curtailed fuel exports to protect domestic supplies, and Middle Eastern refining and shipping have been disrupted by the conflict involving Iran. Tanker costs and insurance rates have also risen, making it more expensive to move refined products around the world.

The result is a global scramble for middle distillates. Both gasoline and diesel are affected by higher crude prices, but diesel is being squeezed more severely because the product itself is in shorter supply relative to demand. That is why the diesel-gasoline spread has widened so dramatically.

The Price Gap Is Now Extraordinary

As of October 5, the national average price of on-highway diesel was $6.199 per gallon, compared with $4.354 for regular gasoline - a spread of about $1.85 per gallon. Diesel reached a nominal record of $6.29 per gallon in September, according to EIA, and remained above $6 nationally in early October.

That gap is not primarily the result of a sudden increase in diesel taxes or some new change in fuel specifications. Those structural factors help explain why diesel usually costs more than gasoline, but they do not explain why the premium is so large today. The current premium reflects a very tight global distillate market layered on top of the long-term changes that already made diesel the more expensive fuel.

That distinction is important because it separates the underlying reason diesel normally carries a premium from the temporary forces that can cause that premium to explode.

Refining Margins Are A Consequence, Not A Cause

Refining margins have risen sharply, and major refiners are benefiting from the tight market. But those high margins are a consequence of constrained diesel supply relative to demand rather than the original cause of the shortage.

When refinery capacity is disrupted, exports are curtailed, and inventories fall, the value of the remaining barrels rises. Refiners that can continue producing diesel benefit from that scarcity, but the scarcity comes first. This distinction is important because high margins are sometimes cited as evidence that refiners decided to raise prices, when in reality the margin expansion is largely the market's response to a shortage of refined product.

Diesel Is A Different Market Than Gasoline

The broader lesson is that gasoline and diesel may come from the same barrel of crude oil, but they are not interchangeable products. They serve different markets, have different seasonal demand patterns, require different processing, and face different global supply pressures. A refinery cannot simply turn every barrel of crude into whichever product happens to be most expensive that day because refinery configuration, crude quality, product specifications, and physical operating limits all constrain what can be produced.

That is why abundant crude oil does not guarantee cheap diesel. The United States can produce record amounts of oil, run refineries near capacity, and still face expensive diesel if global product markets remain tight.

Twenty years ago, gasoline was often the more expensive fuel. Then diesel moved to a structural premium, and today that premium has widened dramatically because the global market for diesel and other middle distillates is again under severe strain. Until those supply constraints ease, diesel is likely to remain much more expensive than gasoline.

Tyler Durden Thu, 10/15/2026 - 06:30

"De-Risk As Fast As Possible": EU Eyes Vietnam For Critical Materials To Cut Alarming China Dependence

Zero Hedge -

"De-Risk As Fast As Possible": EU Eyes Vietnam For Critical Materials To Cut Alarming China Dependence

Brussels appears increasingly aligned with the Trump administration's view that securing reliable, conflict-free supplies of critical materials is important for the incoming rearmament supercycle. Continued reliance on China exposes Western defense manufacturers to export restrictions that have already disrupted supply chains and could delay deliveries. 

Reuters cites internal EU documents dated June 2026 that identified Vietnam as a potential source of critical materials outside China.

"Considering Europe's need to rearm and de-risk as fast as possible, the EU cannot afford ignoring Vietnam as a potential supplier of critical raw materials considering its abundant reserves in rare earth and tungsten in particular," the document stated which was prepared by the EU delegation in Hanoi.

The push comes as Chinese export restrictions collide with the West's rearmament supercycle next year, exposing alarming vulnerabilities in the supply chains needed to manufacture missiles, ammunition, armored vehicles, one-way attack drones, interceptors, sensors, and other military equipment.

The West is quickly learning that bigger and bigger defense budgets alone cannot solve the critical material shortage and there is high urgency in securing alternative supply chains.

Vietnam holds substantial deposits of tungsten, rare earths, and other critical minerals, but its exports to Europe have largely been limited to tungsten and antimony, both of which are used to manufacture weapons.

The document noted that China's restrictions on critical material exports last year disrupted European supply chains, strengthening the case for exploring alternative sources.

It called for stronger relations with Vietnam to "add an alternative to China," especially after Beijing's export restrictions last year "disrupted European supply chains."

"The European Commission is currently assessing the potential for concrete cooperation with Vietnam in the critical raw materials sector," a spokesperson for the EU executive arm told the outlet.

Adrien Rabier, Bernstein's equity analyst covering European aerospace and defense, outlined to clients last month that Europe's rearmament supercycle will begin next year and extend through the end of the decade. 

Our reporting has pointed out that the next phase of the critical materials trade will favor miners already producing and delivering these materials to Western markets. 

This comes as resource nationalism intensifies across critical minerals, metals, energy, adding to uncertainty as the world heads into a potentially volatile winter.

The VanEck Rare Earth and Strategic Metals ETF (REMX), which tracks global companies that produce, refine, and recycle critical minerals, peaked in May and lost nearly half its value by early fall.

REMX's decline appears to be a retracement of the rally in 2025 and early 2026 that followed China's export restrictions. Once the space bottoms, traders will likely focus on miners that can reliably deliver conflict-free materials to the West. These materials are critical not only to the rearmament cycle but also to AI data centers, reindustrialization, electrification, and the broader modern economy.

Tyler Durden Thu, 10/15/2026 - 05:45

'Newspeak': Oxford University Tells Staff To Avoid Everyday English Phrases

Zero Hedge -

'Newspeak': Oxford University Tells Staff To Avoid Everyday English Phrases

Authored by Steve Watson via Modernity.news,

Oxford University has advised its staff to avoid common English idioms such as "learn the ropes" and "find your feet," on the grounds that they may confuse international students or that they perpetuate negative stereotypes.

The guidance appears in the university's official style guide, which also recommends replacing gendered terms and softer language around socioeconomic status, prompting criticism from free speech groups that Oxford is prioritising sensitivity over cultural immersion.

The style guide tells writers to favour "plain English" and cautions: "Be mindful of idioms that may not be familiar to international readers or that may use stereotypes. Use common words, short sentences and familiar constructions."

Specific alternatives are offered: "learn the ropes" becomes "learn how to do that," "find your feet" becomes "getting used to their new environment," and "blindspots" becomes "gaps in knowledge."

Gendered words face similar treatment. "Spokesman," "chairwoman," and "mankind" are to be swapped for "spokesperson," "chair," and "humankind."

Staff are also advised to use "they/them" rather than alternating "he" and "she," to describe "deprived" students as "lower income" or as having experienced "socioeconomic disadvantage," and to prefer "gay" over "homosexual" (except in legal or medical contexts) and "older people" over "the elderly."

Around a third of Oxford's students are international, including a fifth of undergraduates. The university has become increasingly dependent on higher fees from overseas students as domestic funding pressures grow.

An Oxford spokesman said: "Like many large organisations, including newspapers, Oxford University has a style guide to help staff write clearly and consistently. As a global university with staff and students from around the world, we write for a wide international audience. The guide provides practical advice for written University communications, from punctuation to choosing language that readers will readily understand. Its writing guidance is advisory and supports staff in exercising their own judgement about the language they use and the audience they are writing for."

Lord Young of the Free Speech Union rejected the premise. "Surely, one of the reasons international students come to Oxford is so that they can immerse themselves in our culture and master colloquial English," he said. "What's next? Is Oxford going to insist all lectures have to be in Esperanto?"

The episode fits a wider pattern of language policing across British higher education and politics. Cambridge University has previously argued that free speech should be restricted in certain circumstances.

Other institutions have declared the term "ethnic minority" itself offensive.

UK students have been ordered to undertake white privilege training.

The government has urged schools to report "anti-Muslim hostility."

The Green Party has called for the words "mother" and "father" to be erased in favour of more inclusive alternatives.

These measures arrive as universities face financial strain and recruit more heavily from overseas. Critics argue the result is a slow dilution of the very cultural and linguistic distinctiveness that draws international students in the first place.

Learning everyday English, including its idioms, is part of mastering the language rather than an obstacle to be removed. Treating common British phrases as potentially confusing or stereotypical places the burden of adaptation on the host culture instead of on those who choose to study within it.

The style guide is presented as advisory. In practice, such documents shape institutional expectations and signal which forms of expression are considered acceptable. Free speech advocates note that once everyday language is flagged as risky, the scope of self-censorship expands.

Oxford's response emphasises clarity for a global audience. Lord Young's reply highlights the opposite priority: that international students benefit from encountering the language and culture as it is used.

British universities remain among the world's leading institutions. Their reputation rests on rigorous standards and open inquiry, not on rewriting ordinary English and instituting Orwellian Newspeak to minimise every possible misunderstanding.

Treating common idioms as problems to be solved by avoidance rather than explanation reverses the traditional purpose of a world-class university. Students who arrive at Oxford should leave more fluent in the language and more familiar with the culture, not less exposed to either.

Tyler Durden Thu, 10/15/2026 - 05:00

NGO Says "Climate Change" To Blame For Increase In Child Marriages

Zero Hedge -

NGO Says "Climate Change" To Blame For Increase In Child Marriages

The climate change industry (and yes, it is an industry) generates approximately $18 billion globally for NGOs, and a big part of that cash flow is the relatively new agenda of "Climate Justice".  This is the melding of the global warming fraud and the social justice fraud into one very big and very lucrative mega-fraud.  

Climate Justice is simply another strategy for attacking western economies and free market enterprise, using the accusation that the west is "creating environmental crisis" which developing nations then suffer for.  In other words, it is repeating the false claim that the wealth of the west is built on the suffering of the third world.  If it weren't for the US, Europe and other developed nations, the third world would be rich and prosperous and peaceful and a multicultural Utopia would flourish.   

The end game of this narrative, of course, would be the eventual dismantling of western economies in the name redistributing the wealth, stopping global warming and "saving the world."  It's all a fantasy, but we'll get to that in a moment...

One NGO with extensive ties to the climate agenda is called Plan International, an organization focused on children's rights, specifically the equality of girls and gender-based violence.  Sure sounds like a righteous cause, but the veneer is deceiving.  

According to a recent story by French news outlet Le Parisien, Plan International has released their shocking annual State of the World’s Girls 2026 report, and they assert that climate change is contributing to a sharp increase in child marriages in third world countries. 

The report combines analysis of health and climate data across more than 50 countries over three decades with a survey of 5,000 girls and young women aged 15–24 in Bangladesh, Kenya, Peru, Senegal, and Zimbabwe, plus interviews and focus groups.  At least 36% of respondents observed more child marriages or early unions in their communities after climate-related shocks; about 11% said they had personally experienced one. 

Girls as young as 10 years old can be married off in these culture, even when national laws forbid the practice. Poverty supposedly compels these marriages, because families need to reduce the number of mouths to feed.  Also, the younger the bride, the more in "Bride Price" (payment) the family might receive in some cultures.

The survey attempts to link "climate change to destructive weather events, the weather events to a rise in poverty, and poverty to rising child marriages.  It's quite a stretch, but it gets worse.  The NGO also attempts to link climate change to sexual assault and increased violence against women.  

And of course, the "Climate Justice" position implies that the women in these countries are facing such violence and exploitation because of the actions of first world economies.

In their COP policy briefs (COP26, COP27, COP28 and others), Plan International states that “early industrialization, colonization, and wealth inequality means that developed countries contribute to global emissions significantly more than others.  They call on countries with “the greatest historical and current responsibility” to raise emissions-reduction ambition and increase climate finance (more money for the NGOs).  

Plan International presents itself as a humanitarian org focused on protecting girls and women, but they have deep ties to the climate change industry through the UN and other NGOs.  For example, they receive funding from the Rockefeller Foundation, one of the original globalist institutions behind the creation of the climate change narrative in the 1970s. 

As we have shown many times int eh past, there is zero concrete evidence supporting global warming theory.  In fact, the data shows no relationship between human industry and changes in temperatures and weather.  For starters, groups like Plan International use climate data from the past few decades.  The vast majority of climate science uses temp records from the 1880s onward.  None of them acknowledge climate data from longer timelines.

The Earth's weather history is vast, and temperatures have been much hotter than they are today.  Modern temps are some of the coolest in the past 400 million years.  There was no human related carbon emissions back then; the temps fluctuated dramatically anyway.

Furthermore, when matching the carbon content record to the temperature record over this time period, there is no match whatsoever.  In other words, carbon emissions have nothing to do with rising or falling temperatures.  

By extension, there is no indication that current weather patterns are affected by human industry either.  In Bangladesh, for example, flooding is the primary weather related disaster, and there is no evidence of a significant change in the frequency of flooding in the region from 50 to 100 years ago.  The weather changes according to the long cycles of the Earth.  The economic successes of the west have no bearing at all on the suffering of the third world. 

Maybe don't build your village in a desert or a flood plain. 

 

As for the child marriage problem, these cultures have been engaging in this behavior for thousands of years.  If anything, the west has contributed to a steep decline in these kinds of barbaric practices.  What was the scapegoat for third world nations prior to the fabrication of the climate change crisis?  

The lesson here is to beware of NGOs and the causes they claim to champion.  They have a tendency to hide their true intentions behind otherwise noble pursuits.  

Tyler Durden Thu, 10/15/2026 - 04:15

"Russian Bots", Burning Data-Centers, & Partitioning The Internet

Zero Hedge -

"Russian Bots", Burning Data-Centers, & Partitioning The Internet

Authored by Kit Knightly via OffGuardian,

The Ukrainian military used their surfeit of drones to destroy Yandex data centres in Russia, and as a result, "hostile" Russian bot activity dropped to almost zero.

That's the story.

There's no evidence it's true, of course, but since when did that make any difference?

What were these alleged bots supposedly talking about?

Well, that depends who you are.

If you're a Covid-era pro-vaccine nut job, they were talking about Fauci and ivermectin and vaccines harms.

If you're a Zionist, they were supporting about "free Palestine".

If you're a Democrat, they were spouting MAGA talking points.

If you're a leftist in general, they were promoting the AfD in Germany, Reform in the UK or just the "far right".

It turns out the bots are everyone who disagrees with you and nobody who agrees with you.

Isn't that nice?

No matter who you are, there's a source-less graph out there with a line going down which shows you were right about everything.

It's not like you can just make up a graph.

Zelensky summed the situation up thus:

"It suddenly became a little easier to breathe on many social platforms. There was less hate, less division and fewer provocations,"

We've been given taste of a Russia-less and/or bot-less and/or disinformation-less internet, isn't it lovely?

To be clear, again, there is no evidence at all this is true. They just say things.

This comes hot on the heels of Andy Burnham just saying - sorry, "confirming" - that Russia tried to influence the Brexit referendum back in 2016 (a sure indication he plans to reverse that decision, but that's another story for another time).

The point is we're all being influenced by big bad Vlad and his big bad bots.

Maybe we should do something about it, right?

You know what would help filter out hostile state-driven AI bot activity?

Digital ID. Just sayin'.

Or, perhaps we should partition or the internet...

Nobody is saying that - yet - but this is kind of story is laying the groundwork. Just wait.

As I wrote about AI and data centre fear last month:

None of this will really be about avoiding any apocalypse.

It will be about compartmentalisation. Cutting lines of communication.

Running small business or personal websites in general will become more expensive as the "data centre tax" is added to hosting providers.

Much like the "sugar tax" on fizzy drinks and snacks in the UK, this tax will notionally be paid by the hosting providers, but will be passed onto the customers via increased prices.

Major corporations will be able to easily afford these increases, but smaller independent sites will feel the pinch.

It will be cheaper to pay corporate resellers to cohost, but then you'll have to sign up to agreements about not publishing "misinformation" and, again, provide your proof of humanity.

If you run a website your data centre usage tax will be 0.04 per local visitor, but 0.10 per international visitor - since serving data further is more compute heavy.

You'll be able to get reductions in hosting costs if you use a "local only" server, accessible only to those resident in your home country/region/bloc etc.

Automatic translation, we'll be told, is very heavy on AI usage. So it will be increasingly cheaper to only publish in your native language too.

It won't matter if any of this is true or not, they'll just say it, as they do.

On social media, the more followers you have the more data you're using, so after a certain point you will have to either pay to maintain your followers, or pay per post to make sure your followers can see it.

Of course these limitations won't apply to legacy outlets like the BBC, CNN or their ilk of course. They will be exempt, because they are part of the "essential information distribution network".

And all the time, the fear of "rogue AI" will be there, to be picked up as convenient. A digital pandemic that, like Covid, can be started and stopped on a dime by the digital version of "testing protocols".

Kill switches and "digital firebreaks", allegedly installed to quarantine "rogue" AI agents, will enable swift isolation of any anti-establishment opinions or information that breaks through to an audience of any size.

An independent news YouTube channel getting a lot of views? Oh no, it's been reported to be AI and has been suspended pending investigation!

An alternate media website is getting a lot of views? Oh no, the server it's stored on has been compromised by AI and needs to be temporarily isolated!

Again, obviously not one word of this needs to be true. They will just say it. Like they just say everything now.

And the real kicker is it won't matter if global internet traffic does decrease or data centre use really declines. They probably won't even check. The real numbers don't matter.

- Rogue AI "Regulation" - A Potential Worst Case Scenario

"Russian bots" is perfect for this, mixing "AI bad" with "Russia bad" with "disinformation bad" in a neat little agenda cocktail.

Like Mary Poppins' medicine, everyone gets the flavour they want.

It's exactly the kind of ridiculous story that could be used to justify this process down the line.

We publish a variety of perspectives. Nothing written here is to be construed as representing the views of ZeroHedge.

Tyler Durden Thu, 10/15/2026 - 03:30

Iran Hormuz Attack Spree Starts Choking Oil Flows (Again), UBS Warns

Zero Hedge -

Iran Hormuz Attack Spree Starts Choking Oil Flows (Again), UBS Warns

A surge in Iranian drone attacks on commercial ships appears to be weighing on Middle Eastern energy exports through the Strait of Hormuz, with 24 attacks reported so far this month. The latest reports indicate that two Emirati container ships were struck and sank in the narrow waterway within the past 24 hours.

UBS energy expert Henri Patricot told clients on Wednseday morning that crude and petroleum-product flows exiting the Gulf of Oman dropped to 9.1 million barrels a day over the past couple of days. The weekly average slipped to 13.5 million, compared with an early-October peak of 17 million. 

Patricot provided more color on deteriorating shipping conditions in the Strait of Hormuz:

More attacks around Hormuz and in Saudi Arabia

Attacks on tankers in the Strait of Hormuz and in the Gulf of Oman continue to be reported at the highest intensity since the start of the conflict (Figure 24).

Iran is reportedly using a new strategy to target ships, including using spotters in small boats. The attacks appear to be having a clearer negative impact on traffic via Hormuz in recent days. Separately, attacks have also continued in Saudi Arabia, with reports that Aramco's HQ which was targeted overnight.

Oil flows falling further; LNG holding up at much lower level

The latest data point to a more material drop in exports from the Middle East. UBS Evidence Lab data (> Access Dataset) indicate that crude and product flows out of the Gulf of Oman dropped to 9.1Mb/d in the past couple of days and have averaged 13.5Mb/d in the past week vs. a peak of 17Mb/d in early October (Figure 3). 

Our estimate of combined crude and product exports through Hormuz and bypass routes is down to 9.5Mb/d over the past week, well below the recent high of 16Mb/d and September average of 14Mb/d (Figure 2).

Flows are still likely to be revised higher but there now appears to be a clear trend of declining flows since early October now. We are adding a new chart showing LNG flows out of the Gulf of Oman (Figure 4). 

There has been an improvement in flows since mid-September and they are holding up for now, but only at ~25% of pre-conflict levels, vs. oil close close to 50% in the past week and 75% at recent peak.

Crude loadings rebound

On the positive side, Gulf crude loadings excluding Iran bounced back to >12Mb/d over the past couple of days. As loadings in previous days were revised higher too, October loadings are back up to 8.7Mb/d on average, in line the September average (Figure 12). 

There is still no Iranian crude loading (Figure 13). 

Outside Hormuz, preliminary data show no loadings from Yanbu in the past couple of days, taking the average to 1.6Mb/d so far in October, below the September average of 2.7Mb/d (Figure 16). Including Fujairah, bypass crude loadings averaged 2.1Mb/d over the past couple of days and 3.3Mb/d in October, vs. 5.4Mb/d in September. Gulf product loadings have ticked up just above 1Mb/d, still well below normal levels of >3Mb/d (Figure 17).

Commenting on market impacts, Dimitrios Laloudakis, a macro quantitative strategist at UBS, wrote earlier:

Brent Crude December 2028 Makes New Highs While front-end crude has been offered, longer-dated futures continue to reprice higher. The 21-day rolling correlation between front-month and 12th contract falls markedly (level last seen during peak uncertainty when front-month ripped higher). Markets now face the other side of the coin with front-contract remaining tepid, but oil expectations grinding higher for longer-dated futures.

Despite the Trump-Russia diesel deal, US industrial fuel prices continue to inch toward highs.

Earlier today, the International Energy Agency warned that the global diesel squeeze will likely persist well into the first half of 2027.

Tyler Durden Thu, 10/15/2026 - 02:45

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