Failing Canada And Britain Blame Trump, Putin, And 'White Supremacy'

Authored by J.B. Shurk via American Thinker,

Commie Canada and the dis-United Kingdom should be renamed the "Dumb and Dumber" of the British Commonwealth.

King Charles III's North American prime minister, Mark Carney, ran to The New York Times last week to talk about his military combat preparations against the United States in the event that President Trump crosses Lake America and liberates Canada from its delusional leaders. What a showboating dunce. The U.S. singlehandedly sustains Canada's economy and national security, yet the tiny central banker huffed and puffed in a hilariously Napoleonic display of fake strength.

In the same interview with the failing Times, Con-man Carney outlined his intent to integrate Canada's economy with that of China and the European Union and to replace the U.S. Dollar with a China-linked global reserve currency. Rhetorically defending Canada's sovereignty while insulting his U.S. benefactor, Little Mark Carney explained how he would subjugate his socialist nanny-state to Chinese Communist Party General Secretary Xi Jinping and unelected European Commission President Ursula von der Leyen. Mark is the global mascot for "educated" idiots everywhere.

Not to be outdone by not-so-Great Britain's Canadian cousin, U.K. Prime Minister Poindexter (er, I mean Andy Burnham) informed the United Nations General Assembly last week that his government was constructing yet another speech-police organization (this one given the august name, "National Centre for Information Defence," which should not be confused with the "Research, Information, and Communications Unit," the "Government Communication Service," the "Counter Disinformation Unit," the "Defending Democracy Taskforce," the "Information Threats and Influence Directorate," the "Rapid Response Unit," the "National Cyber Force and Social Cohesion Taskforce," the "Media Monitoring Unit," or any of the other information-control agencies already mobilized across totalitarian Britain) to protect the British people from scary thoughts and words. Burnham blamed the Russians for spreading "a narrative of decline, stoking division, and sowing despair" in the U.K. (and definitely not Westminster's promotion of decline, division, and despair!) and promised to counteract this "information warfare" by censoring Britons' public speech and feeding his collapsing country a steady diet of State-sanctioned propaganda. In order to beat back the Russians, Dilapidated Britain must have its very own digital Iron Curtain! Two cheers for democracy! Hip hip...who cares.

The British people are screwed. On average, their government grants settlement or citizenship to an illegal alien every single minute. These foreign nationals receive more welfare from British taxpayers than ever before. The third-world invaders (I mean, "newcomers") use Britain's streets as public toilets. Rather than securing the kingdom's borders, the Home Office hands out a nine-page booklet informing mostly-Muslim men of military age that it is illegal to rape women and children while they conquer the islands. In the last two years alone, the number of illegal immigrants (and future citizens!) arriving by boat has exceeded the size of the entire British Army! But if these outrageous facts disturb you enough to publicly express your feelings on social media, you will most likely join the roughly 65,000 Brits who have been arrested for "speech-related offenses" over the last five years. Foreign invasion? Good! Free speech? Very bad!

Apparently, the British police state also plans to imprison anyone who would rather not fight WWIII against the Russian Federation. During a recent episode of former cabinet minister Jacob Rees-Mogg's "State of the Nation" on GB News, one leftist-globalist commentator in favor of mass conscription argued, "We would have to lock a few people up...some of the pro-Russian voices, people saying there isn't a threat, don't fight for your country, don't go to war for Burnham, we'll have to lock 'em up." Rather than responding with horror at the suggestion that his fellow Britons should be imprisoned for opposing a catastrophic war, Rees-Mogg pedantically replied, "Well, we suspended habeas corpus during the Napoleonic Wars...indeed, yes." In another interview, Rees-Mogg nonchalantly remarked that British citizens have a "duty" to "die" for Britain in a war against Russia.

In Burnham and Rees-Mogg's Britain, the only way to "defend democracy" is to imprison anyone who disagrees with the British Establishment and to sacrifice everyone else to the killing fields! The British Isles might as well be renamed the "Gulag Archipelago."

Interestingly, GB News - which leans conservative - discovered last week that Britain's media regulator, the Office of Communications (Ofcom), had covered up data showing that viewers trust GB News more than the BBC. GB News, in fact, is ranked above all other networks with regard to viewpoint diversity and impartiality. British authorities apparently did not want the public to know these inconvenient truths because the BBC is treated as an objective, trustworthy, and premier source of news (fact check: false!). In an effort to control the public's perception of the BBC, Ofcom restricted what information the public was permitted to know. P.M. Burnham takes the "defense of information" very seriously!

How seriously? Burnham and the British government force citizens to pay for the BBC's awful dreck whether they watch it or not! Every household in the U.K. must fork over a £180 license fee to the BBC each year. Because more households are refusing to pay the license, the government is considering the imposition of a mandatory £11-a-month Internet tax in order to keep the BBC's fake news funded. The BBC says that the "fee is essential for maintaining the quality and diversity of public broadcasting in the UK."

What does "quality and diversity" look like at the BBC? Two "reporters" just did a major exposé describing how women who don't polish their nails perpetuate "white supremacy." No joke! "Nail art's historical and creative roots are linked back to black, Latino, and Asian communities and the suggestion that bare nails are now a sign of high status could stigmatise bold manicures," the BBC "reports." "They are often called elegant or tasteful, and these are often usually euphemisms that perpetuate white supremacist standards of beauty." Yes, Burnham, force Britain's working-class to pay for this race-baiting propaganda posing as hard news!

Earlier this year, British authorities announced that YouTube and other social media platforms would be forced to manipulate their algorithms and push BBC "news" to the top of feeds in order to counter "disinformation." In other words, Whitehall steals money from British citizens to pay for State-run TV and then forces them to watch it. During the Cold War, we called that Soviet-style propaganda. Yet if you ask the fake "reporters" at the BBC, Canada's publicly-funded CBC, or America's NPR or PBS, all these propagandists would insist that they have nothing in common with the Soviet Union's Pravda or the Russian Federation's RT (Russia Today) News. In the West, State-funded media are somehow not State media. Does that sound more like propaganda or breaking news?

Britain's State-imposed "narrative control" is utterly totalitarian. Dismissing the "narrative of decline" and "despair" in Britain as a "corrosive narrative...which bears no resemblance to reality" and a "distorted and untrue narrative about Britain," P.M. Burnham casts all public dissent as "far-right narratives." As military historian Professor Michael Rainsborough mocks, "The problem isn't the problem, the problem is the people noticing the problem." Rainsborough points out that right after Burnham rebranded "decline" as "disinformation," the prime minister laid out a "10-year plan" to fight inflation, housing costs, hopelessness, inequality, and division. "The narrative of decline," in other words, "bears no resemblance to reality, although reality apparently requires a 10-year plan."

Both Canada and Britain are failing. The public has noticed. Carney and Burnham wish to whitewash reality with fake "narratives." The worse things become, the more difficult it will be for their ministries of truth to succeed. Expect the BBC to blame Trump, Putin, and "white supremacy."

Tyler Durden Fri, 10/02/2026 - 23:25

"Are You An FPV Pilot": Pentagon Calls On Drone Operators For Next "Gauntlet" Showdown

The Department of War has put out a request for service members with "FPV experience" to participate in testing events called “Gauntlets” and fly Category 1 drones in field training exercises to accelerate drone development and prepare the US for the next conflict, where drones, robotics, and automated kill chains dominate the modern battlefield.

"Are you an FPV pilot? We want to hear from you!" DoW asked on X on Friday morning.

"The Drone Dominance Program is recruiting service members with FPV experience who would like to be considered as pilots for future Gauntlets and related efforts," the request said.

Are you an FPV pilot? We want to hear from you! The Drone Dominance Program is recruiting service members with FPV experience who would like to be considered as pilots for future Gauntlets and related efforts. Interested? Visit https://t.co/dlfuzlu2c0 to learn more: https://t.co/AyOAxjw9jt

— Department of War Innovation Unit (@DIU_x) October 2, 2026

The Drone Dominance Program is the DoW's answer to purchasing large quantities of drones across every category, from 1 to 5, and building out a domestic supply chain of components free from dependence on conflict areas and countries such as China, which can easily weaponize supply chains to hinder procurement.

Earlier this week, Defense Secretary Pete Hegseth revealed that Autonomous Warfare Command, dubbed "AutoWarCom," is set to accelerate the DoW's purchases across all categories of drones, robotics, and AI.

What's key is that drone procurement will be a massive part of the rearmament supercycle and provide tailwinds to drone companies, such as heavily shorted Ondas, whose Ultra drone could very well see ramped-up orders by the military as it's seen as an MQ-9 Reaper alternative for ISR missions. 

"Once we apply sustained budget to changed doctrine, we will outperform the world," said Owen West, a former Marine, assistant defense secretary, and Goldman Sachs trader who has been tasked with leading the DoW's Defense Innovation Unit. "And by snapping in AI, we will be ahead of the world, because we are the leaders in AI."

Tyler Durden Fri, 10/02/2026 - 23:00

The Tyranny Of One Man's Opinion

Authored by Judge Andrew P. Napolitano via LewRockwell.com,

Thomas Cromwell was the Lord Chancellor of England for much of the reign of King Henry VIII. He engineered the convictions and executions of many whom Henry wanted out of the way, including his two predecessors in office - one of whom was St. Thomas More - and even the king's second wife, Queen Anne.

When Cromwell's son Gregory, who became sickened as he watched his father devolving from counselor to monster, learned that an executioner for the queen had been sent for from France a week before her trial, he asked his father what the purpose of her trial was if the king had preordained the queen's guilt and prepaid the executioner. Cromwell replied that the king needed a jury to give the appearance of legitimacy to her conviction and prevent the public perception of "the tyranny of one man's opinion."

In America, we have a Constitution not only to prevent the perception but also the reality of the tyranny of one man's opinion. The Constitution's Fifth Amendment makes clear that if the government wants life, liberty or property, it cannot take it by executive command, but only by due process - a fair jury trial and all its constitutional protections; and Article I makes it clear that if the government wants war, it cannot commence it by executive command, but only by congressional declaration.

We have a Constitution also to assure the separation of powers in the federal government. Congress writes the laws, appropriates the taxpayers' money and funds borrowed in their names and declares war when the United States is in danger of imminent foreign threat. The president enforces the laws, spends money as Congress directs and wages the wars Congress has authorized. The judiciary decides what the Constitution and the laws mean and, if properly challenged, determines if the president and Congress or the states have exercised their duties lawfully and constitutionally.

The central constitutional question is not whether a president sincerely believes that his policies are necessary. It is whether the Constitution permits personal liberty and limited government to depend upon the opinion of one man. That is the danger of executive government without effective legislative and judicial checks.

A fair reading of the Constitution begins with a truism: Presidential power is not whatever the president believes it to be. It is only what the Constitution and laws actually confer.

Consider the administration's attacks on alleged drug-trafficking boats. President Donald Trump says he has directed military forces to strike narcotrafficking vessels and describes the operation as part of his campaign against fentanyl and cartels. But the constitutional question is separate from the president's characterization of the targets. A person suspected of being a drug trafficker - or even a mass murderer - does not thereby become condemned to death. Criminal guilt always requires accusation, evidence and adjudication according to law, before punishment.

These boat killings are unlawful extrajudicial executions. In the language all Americans can understand, they are murders.

The same principle applies to Iran. The Framers deliberately divided the war powers. Article I gives Congress the power to declare war, authorize military force, regulate the armed forces and control appropriations. Article II makes the president commander in chief. The distinction matters. The president commands forces; Congress determines where and under what circumstances the president does so.

Trump has openly declared an American blockade of the Strait of Hormuz and said that the United States controls which ships pass through it. He has also imposed sanctions which deny food, medicine and currency stability to millions of innocent Iranians. He even threatened to murder all Iranians - beyond the thousands he has already killed - if a peace agreement is not soon reached.

Those statements highlight what the Constitution was designed to prevent one individual from addressing alone: Whether the United States should wage military and economic hostilities against the population of another nation.

Congress has repeatedly resisted treating the Iran conflict as a matter solely for presidential discretion. Just two weeks ago, support for Trump's war failed to muster majorities in both houses of Congress.

Nor can the president's personal assessment of Iran's nuclear intentions settle the matter. In 2018, his State Department's compliance report said Iran was fulfilling its nuclear-related non-proliferation commitments and U.S. intelligence had assessed with high confidence that Iran had halted its nuclear weapons program in 2003.

In 2020, his State Department again said that Iran was not then engaged in key activities associated with designing and developing a nuclear weapon. In 2025, his Director of National Intelligence testified that the entire U.S. intelligence community continued to assess that Iran was not building nuclear weapons.

Those facts alone establish something constitutionally important: The president's personal belief - whether informed or uninformed - is not evidence or law or a substitute for congressional authorization.

The same textual principle reaches domestic spending and taxation. Article I provides that only Congress can impose taxes, and money may be drawn from the Treasury only pursuant to appropriations made by law. Even though the Supreme Court has invalidated Trump's tariffs, he continues to impose them. Even though Congress has not authorized funds for Trump's vanity projects, he continues to spend tax dollars on them.

The Constitution does not grant any branch of government carte blanche. It has separated powers precisely because legislators, presidents and judges can all succumb to the corruption of power - and can all be wrong.

That is the deeper meaning of the tyranny of one man's opinion. The danger is not merely that one president might be wrong. It is that a constitutional system becomes meaningless if one man's conclusions about war, crime, taxation, spending, foreign threats or national security become the sole basis for government actions - particularly actions that kill innocents.

The Founders separated the sword from the purse and divided governmental power because they understood a truism: Personal liberty and limited government cannot long survive when entrusted to one man's opinion.

Tyler Durden Fri, 10/02/2026 - 22:35

NASA Wants To Resurrect The SR-71 Blackbird

Earlier this month, NASA Administrator Jared Isaacman fueled speculation about the agency's high-speed flight research plans by unveiling a mysterious aircraft silhouette on a slide titled "Rebuilding our X-plane portfolio."

Asked whether the image on the slide depicted the famed SR-71 Blackbird, Isaacman denied it was a Blackbird but signaled renewed ambitions for high-altitude, high-speed flight, saying NASA was getting back into the business of "flying high and fast again."

NASA Administrator Jared Isaacman showed a mysterious aircraft during the portion of his All-In Summit presentation on rebuilding NASA’s X-plane portfolio ✈️

• Isaacman showed a dark silhouette resembling a next-generation SR-71 Blackbird while discussing 'radical airframe and… pic.twitter.com/VNEDExk8K0

— Latest in space (@latestinspace) September 22, 2026

This brings us to an Aviation Week report saying NASA is working to return a Blackbird to flight after nearly three decades in retirement.

The agency has approached retired Blackbird engineers about restoring Tail No. 844, a 59-year-old aircraft removed earlier this year from an outdoor display at NASA's Armstrong Flight Research Center in California.

The aircraft was moved into a former Space Shuttle hangar, where crews have been working on it, former NASA and Air Force test engineer Mike Relja revealed to the aviation news website. 

However, as the outlet shared, there is one major problem:

The Air Force and NASA destroyed a $600 million supply of spare parts for the Blackbird fleet in 2007. The move came long after it seemed unlikely, if not impossible, that an SR-71A would return to operational service.

That decision could lead to significant restart costs. In addition to all of the consumable spares that must be in regular supply, NASA would need to restore access to the Blackbird's unique JP-7 fuel blend, the triethylborane ignition chemical, engine oil and hydraulic fluids, Relja adds. A hodgepodge of bespoke ground equipment also no longer exists, leaving the current effort without vital, if unheralded, pieces of equipment.

"To raise the wing, you need a cart," he says. "To get the engine out, you need a cart. You need equipment to pull the [engine] spikes, pull the [ejection] seat. All that stuff is gone."

When Relja raised all of these issues with Ash, the NASA manager assured him it would not be a problem, without going into details about their solutions.

"Every time I threw one of these things out there, he says, 'Oh, engineering will take care of that [and] engineering will take care of that,'" Relja recalls.

At the same time, he does not dismiss a return to flight as impossible, especially if NASA has enough resources to make it achievable.

"If you got a ton of money, maybe you can make it happen," he says. "They went to the Moon, you know."

Why NASA wants to restore the SR-71 to flightworthy status remains unclear. Reports over the years have pointed to Lockheed Martin's development of the SR-72, dubbed the "Son of Blackbird," for intelligence, surveillance, and reconnaissance missions. Yet no flight tests have been publicly confirmed. 

Tyler Durden Fri, 10/02/2026 - 22:10

Mystery Gunmen Slaughter Seven People On Bus In Syria's Homs

Via Middle East Eye

Gunmen in Syria killed seven people and wounded four others after opening fire on a civilian bus in western Homs province on Wednesday evening.

The bus was carrying company employees returning home from work when it came under fire as it crossed the Masyaf Bridge in the western Homs countryside, according to the Homs Health Directorate.

Downtown Homs. Wiki Commons

Security units were immediately deployed to the scene to secure the area, while criminal investigators began collecting evidence to identify those responsible and determine the motive, according to Homs Internal Security Forces commander Brig Gen Bassem Mohammad Shaaban.

The injured were taken to hospitals across the governorate, while security forces began an investigation.

Maan Mahmoud Fahd, director of the Homs Grand Hospital, told Sana that four individuals were declared dead upon arrival, after suffering from severe gunshot wounds to the head and chest.

No group has yet claimed responsibility, and authorities have not named any suspects. Shaaban vowed to pursue those responsible, saying the attack would not go unpunished.

"We view this cowardly attack as an attempt to undermine security in Homs and destabilise the stability we have worked to consolidate," Shaaban said.

"We will not allow criminals to threaten the security of our people or undermine the stability the city is experiencing," he added.

The ambush was one of several recent attacks to raise security concerns in Syria since the fall of Bashar al-Assad's government in December 2024.

Brigadier General Munir al-Hariri, a Syrian military analyst, told Syria TV that former Assad loyalists were most likely behind Wednesday's attack, which he said aimed to destabilize security in the country. [ZH: We should note the presence of the literally hundreds if not thousands of jihadist groups, many of them foreign, unleashed on Syria during the height of the CIA/NATO/Gulf-backed proxy war to overthrow Assad].

In August, a bus carrying members of the internal security forces was targeted near Damascus, while an explosive device exploded on a passenger bus in Jaramana, southeast of the capital, wounding 14 people earlier that month.

Gas pipeline blast

The bus attack was one of three major security incidents to hit Syria on Wednesday. A gas pipeline explosion at the Tishreen thermal power plant in Syria's Damascus countryside on Wednesday evening forced three power stations out of service, the Syrian Electricity Company said, warning that the shutdown would cause longer scheduled power cuts.

The blast triggered a large fire and injured two people, according to state broadcaster Alikhbaria. The explosion hit a pressure-reduction station at the plant entrance and damaged the two gas lines that supply it, the Syrian Petroleum Company said.

The loss of gas supplies shut down the Deir Ali and Nasiriyah plants, along with Tishreen, which lies about 36km from the capital.

Abdul Hamid Salat, director of the energy ministry's media department, said the interruption to gas supplies had also affected water-pumping and treatment stations, disrupting services for hundreds of thousands of people across Damascus and its countryside, Daraa, Sweida and Quneitra.

Speaking at the site late on Wednesday, Energy Minister Mohammad al-Bashir said the fire was brought under control overnight. Al-Bashir added specialists would inspect the site once civil defense teams finished cooling it, to determine "the causes and circumstances precisely".

The Homs microbus that was targeted, via SANA

Authorities have not yet established whether the explosion resulted from a technical fault, a deliberate attack or sabotage.

Israeli incursion

Israeli forces fired three artillery shells at the area around al-Mantara Dam in Syria's southern Quneitra province on Wednesday. No immediate casualties or damage were reported.

On Thursday morning, Israeli forces also entered the village of Saida al-Golan in southern Quneitra with around 12 military vehicles as students were making their way to school. The forces later withdrew towards villages in the Yarmouk Basin, with no reports of arrests or house searches.

Reports from Al-Araby News outlet indicate that there was an assassination attempt on a Ministry of Defence officer in the city of Sanamen, situated to the north of Dara.The shelling came amid continued Israeli military activity in southern Syria.

On Tuesday, Israeli forces carried out incursions in Quneitra, including an operation in which soldiers questioned and assaulted shepherds, according to Syrian state media.

The latest developments also come days after Syrian President Ahmed al-Sharaa said talks with Israel on a security framework had reached nearly 90 percent agreement before Israel withdrew or introduced additional conditions.

Speaking at an Atlantic Council panel in New York last week, al-Sharaa said several rounds of negotiations had taken place over the previous year with US involvement and that the talks were continuing.

Tyler Durden Fri, 10/02/2026 - 21:45

DOJ Won't Defend Suppressor Registry In Court After Congress Killed The $200 Tax

The Justice Department has now made it official: it will not defend part of the 92-year-old National Firearms Act in court, confirming what we reported in August.

Solicitor General D. John Sauer told Congress that "the Department of Justice has determined not to file an appeal" in Silencer Shop Foundation v. ATF, the case in which a federal judge ruled that NFA registration requirements for suppressors and short-barreled rifles and shotguns are unconstitutional now that the tax behind them is gone. The letter, addressed to Senate Judiciary Chairman Chuck Grassley and dated Sept. 24, was made public this week.

The NFA has required owners of suppressors and short-barreled guns to pay a $200 tax and register with the federal government since 1934. President Trump's One Big Beautiful Bill eliminated that tax for suppressors and short-barreled rifles and shotguns, but left the registration requirement in place. Gun rights groups sued, arguing that a registry justified by Congress's taxing power can't survive once there's no tax to collect.

On Aug. 5, U.S. District Judge James Wesley Hendrix of the Northern District of Texas agreed, finding the challenged provisions could no longer be sustained under Congress's taxing power and rejecting the government's fallback argument that the interstate commerce power could save them. The case was consolidated with Jensen v. ATF.

The injunction protects the plaintiffs and their "current and future members and customers," not the general public. The covered groups include Gun Owners of America, the Citizens Committee for the Right to Keep and Bear Arms, FPC Action Foundation and the Texas State Rifle Association, according to Bearing Arms. Machine guns, destructive devices and the NFA's special occupational tax are not covered at all.

The result is a two-tier Second Amendment. If you hold the right membership card, the federal registry no longer applies to your suppressor. If you don't, nobody in Washington will say. "The DOJ has yet to release any guidance about how the court's decision will impact the NFA's registration requirements for those who fall outside the protection of the injunction," Bearing Arms' Cam Edwards wrote.

The court granted DOJ a 10-day extension, to Oct. 12, to respond to nine plaintiff states asking whether the injunction covers all of their residents or only members and customers of the plaintiff groups, and ATF Director Robert Cekada has said guidance on transfers and interstate travel is coming "within weeks."

Republicans on the Hill want the department to go further. In August, Rep. Andrew Clyde of Georgia led 46 House members and 8 senators in urging Attorney General Todd Blanche not only to skip the appeal but to apply the ruling nationwide through rulemaking, warning that "an appeal would prolong regulatory uncertainty for law-abiding gun owners and businesses and would consume DOJ resources."

Whether the nationwide relief they asked for arrives, in the Oct. 12 filing or ATF's promised guidance, will decide whether gun owners outside the covered groups are still committing a federal felony by skipping paperwork for a tax that no longer exists.

* * *

Tyler Durden Fri, 10/02/2026 - 21:20

When Regulation Changes Who Becomes Rich

Authored by Shahid Islam via RealClearMarkets,

Economic debates about inequality usually begin with a familiar question: Who has how much income?

It is an important question. But perhaps it is not the only one we should be asking.

A society can change who becomes rich without substantially changing how unequal the society is. Regulation can weaken one economic elite while creating opportunities for another. Entrepreneurs and investors may lose relative influence while lawyers, compliance specialists, lobbyists, consultants and regulatory experts gain it.

The Gini coefficient may barely notice.

Income distribution and income-source distribution are not the same thing.

Regulation does more than redistribute income. It changes the relative returns to different kinds of knowledge and human capital. And when those returns change, talented people respond.

Elite Substitution

Imagine an economy in which high returns come primarily from producing things consumers voluntarily buy. Entrepreneurs search for new products, engineers improve production and investors search for promising companies.

Now introduce an increasingly complex regulatory system.

Those activities do not disappear. But another set of skills becomes more valuable: interpreting regulations, satisfying disclosure requirements, obtaining government permissions, anticipating political decisions and influencing the rules themselves.

The relevant question is not simply whether regulation reduces inequality. It is what happens to the return from creating economic value relative to the return from navigating political and regulatory institutions.

If intervention reduces the return to one form of economic power while increasing the return to another, we may get what I call elite substitution.

The elite does not disappear. Its composition changes.

Sarbanes-Oxley and the Fixed Cost of Complexity

Consider the Sarbanes-Oxley Act of 2002.

Following Enron and WorldCom, Congress sought to strengthen financial reporting and restore investor confidence. But compliance costs are not necessarily proportional to firm size.

A large corporation and a small public company may both need auditors, lawyers, internal-control systems and compliance personnel. The large company can spread those expenses across billions of dollars of revenue. The smaller company cannot.

GAO research has found that Sarbanes-Oxley compliance costs, although generally higher in absolute terms for larger companies, are proportionately more burdensome for smaller companies. GAO also found that companies moving from exempt to nonexempt status experienced a median increase of about $219,000, or 13 percent, in audit fees in the year of transition.

Sarbanes-Oxley did not cause the rise of private equity by itself. But increasing the fixed cost of public ownership changes the relative attractiveness of public and private organizational forms.

That matters because public markets allow ordinary investors to participate directly in corporate growth, while many private-market opportunities have historically been concentrated among institutional and accredited investors.

Regulation intended partly to protect ordinary investors can therefore inadvertently encourage some activity to migrate toward markets to which those same investors have less access.

Who Can Afford the Maze?

I saw another version of this phenomenon while working in the wealth-management industry before 2008.

I remember a rule of thumb concerning sophisticated offshore trusts: they generally became economically worthwhile only for estates of roughly $75 million or more. The precise threshold varied, but the economics was straightforward.

Lawyers, accountants, trustees and other specialists were expensive. Below a sufficiently large asset level, the cost could exceed the benefit.

That experience taught me something important:

Complexity has a fixed cost.

A $100 million household can economically justify sophisticated legal and tax strategies whose professional costs would make little sense for an ordinary household.

The same principle applies to businesses. A small company may struggle to employ one regulatory specialist. A multinational corporation can maintain entire departments of attorneys, accountants, lobbyists and compliance professionals.

Rules may formally apply equally while imposing very unequal economic burdens.

This creates a paradox. Regulation intended to constrain powerful economic actors can sometimes increase their relative advantage because they possess the resources necessary to navigate the resulting complexity.

We have not necessarily eliminated privilege. We may simply have changed its technology.

Dodd-Frank and Yesterday's Crisis

The same issue appears in banking.

After the 2008 financial crisis, Dodd-Frank increased the importance of compliance officers, attorneys, risk specialists, consultants, programmers and regulatory analysts. A Government Accountability Office study found that community banks, credit unions and industry associations reported increased staffing, training, employee time and compliance-system expenditures associated with selected Dodd-Frank rules.

The obvious defense is that this activity may prevent another financial crisis. If so, its social return could be enormous.

But that argument contains a difficult knowledge problem.

Major financial regulations are often responses to observed failures. Sarbanes-Oxley followed Enron and WorldCom. Dodd-Frank followed the financial crisis.

But the next crisis need not resemble the last one.

Financial institutions adapt. Capital moves. Technology changes. New products appear and risks migrate. The Federal Reserve's financial-stability framework itself acknowledges that shocks are inherently difficult to predict and therefore focuses primarily on monitoring vulnerabilities rather than predicting particular shocks.

This does not mean regulation produces no benefits. Higher capital, greater liquidity and improved risk controls may make institutions safer.

But the costs are relatively visible: compliance departments, legal expenses, reporting systems and management time. One of the largest claimed benefits - the crisis that did not happen - is much harder to observe.

The economic question is whether the marginal resources devoted to regulation make the financial system sufficiently safer to justify their opportunity cost.

The ACA and the Value of Political Knowledge

The Affordable Care Act illustrates another side of the same phenomenon.

The ACA changed subsidies, insurance rules, reimbursement arrangements and government-financed coverage. These changes affected expected revenues and profits throughout the healthcare industry.

Economists Mohamad Al-Ississ and Nolan Miller examined Scott Brown's surprise 2010 Massachusetts Senate victory, which reduced the perceived probability that the pending healthcare legislation would survive in its expected form.

They found striking differences. Managed-care firms experienced abnormal returns of about 6 percent, pharmaceutical companies about 2.8 percent, while healthcare facilities experienced abnormal losses of about 3.5 percent.

This does not prove that these gains and losses were political rents. A hospital could become more valuable under expanded insurance simply because more patients could pay their bills.

But it demonstrates something important:

Government rules can change expected private cash flows sufficiently that political events become capitalized into asset prices.

Once the government determines reimbursement formulas, subsidies and eligibility rules, understanding government becomes part of business strategy.

Political knowledge acquires economic value.

And when political decisions can create or destroy substantial corporate value, firms rationally devote resources to anticipating, navigating and influencing those decisions.

What the Gini Coefficient Cannot See

Imagine two economies with identical income distributions.

In one, high incomes depend primarily upon success in markets. In the other, they depend much more heavily upon successfully navigating political and regulatory institutions.

The Gini coefficient could be identical.

The economies would not be.

This is why inequality statistics tell us only part of the story. We measure how much income people receive but rarely ask enough about what activities generate that income.

None of this establishes that regulation necessarily makes society poorer. Preventing fraud, improving disclosure or correcting genuine externalities can create social value. Elite substitution and a smaller economic pie are separate propositions.

But every society has unusually talented and ambitious people. The important question is what institutions reward them for doing.

Do they receive the highest returns from inventing products, building companies and allocating capital successfully?

Or increasingly from mastering the rules governing those activities?

People respond to incentives. Economists have understood that for centuries. There is no reason the principle should stop operating when the government enters the picture.

Sarbanes-Oxley, Dodd-Frank and the Affordable Care Act addressed very different problems and may have produced important benefits. But all three raise a question conventional discussions of inequality often overlook:

When the government changes the rules, does it eliminate economic privilege - or merely change who is best positioned to capture it?

And when talented people discover that navigating the rules offers greater rewards than creating value outside them, we should ask one final question:

Did we redistribute the pie - or did we also make it smaller?

Tyler Durden Fri, 10/02/2026 - 20:55

US Squeezes China's Jet Parts Supply As Rare Earth Showdown Escalates

If you want an indication that resource nationalism and Beijing's weaponization of critical material exports to gain leverage over the US in high-stakes trade negotiations are accelerating, a new report Thursday afternoon says the Trump administration is planning to slow shipments of commercial jet parts to China.

Reuters cites several people familiar with the Commerce Department's moves to slow export licensing and limit the quantities of jet parts approved for shipment to China's state-owned planemaker COMAC to prevent stockpiling.

Officials have also explored new licensing requirements covering aviation hydraulic fluid and rules that could make it easier to restrict landing gear and other components.

The report stated:

The slowdown has taken several forms. The Commerce Department slowed export licensing for airplane parts bound for China in recent weeks, two other sources told Reuters.

Officials have also expressed interest in issuing an export regulation that could make it easier to restrict landing gear and other aircraft parts to China, two sources said. A draft version included a new licensing requirement on aviation hydraulic fluid shipped by US suppliers like ExxonMobil, one of the people said.

And the Commerce Department has been ⁠limiting the number of parts licensed to be shipped to China's state-owned planemaker, COMAC, to keep the company from stockpiling, another source said.

What this suggests is that last month's Trump-Xi meeting in Washington produced no resolution on rare earths, only now an increased willingness by Beijing to tighten restrictions on critical material exports to the US and the West even further. 

This has produced shortages of gallium, germanium, tungsten, and other critical materials essential to the looming defense rearmament supercycle, and in return, we've launched our "own the bottlenecks" theme. 

In early 2025, China ramped up restrictions on critical material exports to the US, while the Trump administration sought a level playing field and has choked off China's access to cheap crude, whether from Cuba, Venezuela, or through the Strait of Hormuz.

Tyler Durden Fri, 10/02/2026 - 20:30

FBI Made Over 8,900 Arrests, Located 1,410 Child Victims Under Operation Summer Heat 2.0

Authored by Naveen Athrappully via The Epoch Times,

The Federal Bureau of Investigation has located 1,410 children and arrested 8,927 individuals in around three and a half months under Operation Summer Heat 2.0.

FBI Director Kash Patel speaks at the Nassau County Police Academy David S. Mack Center for Training and Intelligence in Garden City, N.Y., on Aug. 14, 2026. Samira Bouaou/The Epoch Times

Compared to Operation Summer Heat 1.0, which concluded in 2025, arrests are up 3 percent and the number of children located is higher by 34 percent, according to a Sept. 30 post on X by FBI Director Kash Patel. A total of 5,013 weapons have been seized in the current operation, a 120 percent jump from last time.

Operation Summer Heat 2.0 - active between June 1 and Sept. 20 - included the seizure of more than 59,525 pounds of cocaine and more than 1,499 pounds of fentanyl. Six most-wanted fraudsters were caught during this period, while six alleged cybercriminals were extradited.

In an Aug. 29 post on Facebook, FBI Omaha said that under Operation Summer Heat 2.0, they worked with various state, local, tribal, and federal partners in Nebraska and Iowa, resulting in the arrest of around 95 individuals and the seizure of 119 weapons.

The FBI said in a Sept. 14 statement that the operation led to the arrests of 662 individuals across the state of Louisiana, with 315 firearms seized.

"Communities are safer because of our ongoing partnerships and initiatives like Operation Summer Heat 2.0," Special Agent in Charge Jonathan Tapp said in the statement. "Incarcerating a dangerous criminal for one night or even a few hours is 100 percent ineffective at maintaining public safety. However, putting them in prison for years, is a different story."

"This year, the FBI reported the largest year-to-year decrease in violent crime since we started collecting and reporting numbers in 1936," Tapp said.

Last year's Operation Summer Heat, which ran from June 24, 2025, to Sept. 20, 2025, had led to the arrests of 8,629 individuals, with 2,281 firearms being seized. In addition, 1,053 children were identified or located.

A July 2026 report from the think tank Council on Criminal Justice that assessed crime statistics across various U.S. cities found decreases in various crimes.

Homicides were down by 18 percent in the first half of 2026 compared with the first half of last year, according to the report. In addition, aggravated assaults were down 2 percent and gun assaults were down 6 percent.

In a Department of Homeland Security (DHS) statement, Lauren Bis, assistant secretary at the DHS's Office of Public Affairs, credited the Trump administration's policies for lower crime rates, saying it was no surprise that the decline in crime coincided with the deportation of criminal illegal immigrants.

The Council on Criminal Justice suggested in a July 23 statement that no single factor may be responsible for the declining crime numbers.

"Murder and other crime rates are falling across the map, in cities with different political leadership, housing and economic conditions, policing and prosecution strategies, violence reduction models, and levels of federal enforcement activity," Council on Criminal Justice President Adam Gelb said in the statement.

"Local policies and programs surely matter, but the striking consistency of the decline suggests that macro-level forces are exerting enormous influence as well," Gelb said.

Criminal Illegal Immigrants

Meanwhile, the Trump administration continues to crack down against criminal illegal immigrants.

On Sept. 29, the DHS announced that it had recently deported several illegal immigrant gang members, including violent assailants, burglars, and murderers.

Among the deported were a Surenos gang member from Mexico convicted of second-degree murder, a Mexican Mafia gang member with aggravated assault and murder convictions, and an MS-13 gang member with an international warrant for murdering a police officer, the department said.

The DHS also announced on Sept. 30 that it had added 5,000 more illegal immigrants to its Worst of the Worst website. Launched in December, the website allows people to search through a database of dangerous illegal immigrants arrested nationwide.

With the addition of the 5,000, the total number of criminal illegal immigrants displayed on the site is now at over 40,000, according to the agency.

"This is still just a fraction of the total amount that the brave men and women of ICE work every single day to get off our streets and out of our country," DHS Secretary Markwayne Mullin said in the statement, referring to Immigration and Customs Enforcement.

"The Trump Administration is committed to transparency, and that's why this website allows the American people to see for themselves what kind of dangerous illegal aliens ICE is removing from their communities," Mullin said.

Tyler Durden Fri, 10/02/2026 - 20:05

Hochul Yanks Cornell Case From Local DA, Hands It To Letitia James - Who Already Picked A Side

The Cornell fraternity case that was coming apart at the seams this week has a new prosecutor.

Gov. Kathy Hochul signed an executive order Thursday night appointing state Attorney General Letitia James as special prosecutor in the alleged Cornell sexual assault case, effectively removing Tompkins County District Attorney Matthew Van Houten from it.

"Tonight, I signed an executive order appointing Attorney General Letitia James as special prosecutor in the Cornell sexual assault case," Hochul posted on X. "New information has raised serious questions about how this case was handled, and I've lost faith in the Tompkins County DA's ability" to handle it.

Hochul said the newly released information "undercut my faith, and the public's faith" in the DA's ability to investigate and prosecute the case, and went further:

"Who knew what when? What did they do wrong? Why didn't they come forward? How was this woman denied justice?"

Her case against the locals rests on two claims. First, that the woman's own statement that she was raped "never made it into the account that Cornell police sent to prosecutors." Second, that the DA never interviewed her before deciding not to prosecute.

Van Houten had already reopened the investigation earlier this week, according to ABC News. And part of his stated reason pointed in the opposite direction from the governor's: prosecutors said the woman's original statement appeared inconsistent with claims in the civil lawsuit she later filed against members of the Chi Phi fraternity.

CBS New York obtained screenshots of messages sent two days after the alleged 2024 incident, in which one of the accused men apologized for being too intoxicated to "shut it down and kick people out before it got way out of hand," and the woman replied that "none of the sexual stuff was illegal". Her attorney, Thomas Giuffra, acknowledged an exchange took place but could not confirm those specific texts, and said his client was traumatized and in denial at the time and had been intoxicated to the point of incapacity that night. More messages surfaced Thursday that, as Breitbart's John Nolte put it, appear to "unravel" the allegations.

Hours later, the case was taken away from the prosecutor who had just reopened it, and handed to the one whose name is guaranteed to turn it into a national political fight.

James was indicted on federal bank fraud charges in October 2025, but the case was dismissed in November 2025 after a judge ruled that interim U.S. Attorney Lindsey Halligan was not lawfully serving, and two grand juries then declined to indict her again. In March, FHFA Director Bill Pulte sent new criminal referrals over her homeowner's insurance applications to federal prosecutors in Florida and Illinois. She has not been charged. She has called the effort a vendetta, with her attorney Abbe Lowell accusing the administration of trying to "rename, refile, and repeat baseless allegations."

"Every New Yorker deserves to know that when they report a crime, it will be investigated fully and fairly," James said in a statement. The DA's office did not respond to CBS' request for comment.

Three days before her appointment, James had already weighed in. "What this young woman has been forced to endure is horrific and unacceptable," she wrote in a Sept. 28 post, adding, "To her, and to all survivors: you're not alone. We stand with you."

What this young woman has been forced to endure is horrific and unacceptable. I'm holding her in my heart and in my prayers. To her, and to all survivors: you're not alone. We stand with you. https://t.co/az4ViQwgy1

— NY AG James (@NewYorkStateAG) September 28, 2026

Asked about the post at a Friday press conference, Hochul sidestepped. "I have every confidence in our attorney general to do what she's always done, look at the facts, examine the record, and draw the proper conclusions," she said, according to The Independent. James was briefer: "I will not comment on a Facebook post."

Reporter: "Attorney General, on your Facebook page three days ago, you wrote, ‘What this young woman has been forced to endure is horrific and unacceptable. I'm holding her in my heart and in my prayers. To her and to all survivors, you're not alone. We stand with you.’ Why did… pic.twitter.com/AtHcuaPumE

— RedWave Press (@RedWavePress) October 2, 2026

No one has been charged. Whatever happened in 2024, the question of whether the case was mishandled is now going to be answered by the most politically exposed prosecutor in the state. Duke lacrosse fans will recognize the script.

    OCTOBER ONLY.$10 OFFYOUR NEXT ORDER.$30 min. Ends Oct 31. One per customer.GET MY $10 OFF →Signs you up for ZeroHedge Store emails. Can't be combined. Every order helps support ZeroHedge. Tyler Durden Fri, 10/02/2026 - 19:40

Canada Fast-Tracks 1 Million-Bpd Pacific Link Oil Pipeline To Asia

Authored by Julianne Geiger via OilPrice.com,

Canada is fast-tracking a proposed 1 million-barrel-per-day oil pipeline to the Pacific coast, giving Alberta another route to Asian buyers and another way around its overwhelming dependence on the U.S. market.

Prime Minister Mark Carney said Thursday that Ottawa will list the project as one of national interest, sending it through a single federal review process that Ottawa aims to complete by September 1, 2027, potentially allowing construction to begin shortly afterward.

The pipeline would run from Alberta to southern British Columbia, largely following the existing Trans Mountain corridor. Trans Mountain Corp. and Pembina Pipeline would lead the project, with the federal and Alberta governments expected to hold the majority stake. Indigenous communities would be offered at least 10% ownership.

Alberta estimates construction could cost between C$35.2 billion and C$43.7 billion. Ottawa says the project could generate more than C$20 billion in annual GDP, create as many as 140,000 jobs at peak construction and produce C$100 billion in government revenue by 2060.

Canada still sends more than 90% of its crude exports to the United States. Its main escape route is the 890,000-bpd Trans Mountain pipeline, which reaches the Pacific and is already running at capacity.

That Pacific access has become more valuable since the Iran war disrupted Middle Eastern flows and sent Asian refiners hunting for barrels that do not have to clear the Strait of Hormuz. China has already become the largest buyer of Trans Mountain's seaborne exports, taking roughly 60% of shipments, according to the Canadian government.

Ottawa and Alberta are also pursuing another 300,000 to 400,000 bpd of capacity on the existing Trans Mountain system.

The new pipeline still needs a final route, regulatory approvals, and consultation with Indigenous communities and British Columbia.

Tyler Durden Fri, 10/02/2026 - 19:15

CBS Dumps Tony Romo Two Months After OWI Arrest With Roughly $72 Million Left On His Deal

CBS Sports and Tony Romo, the former Dallas Cowboys quarterback turned lead NFL analyst, are done.

"CBS Sports and Tony Romo have mutually agreed to part ways. We thank Tony for his contributions over the past nine years and wish him the best moving forward."

J.J. Watt has been named as Romo's replacement.

Romo joined CBS in 2017 and signed a 10-year, $180 million deal in 2020, one of the richest contracts in sports broadcasting. About four years and roughly $72 million remained on it. Neither side disclosed the terms of the separation, so how much of that CBS actually pays out is anyone's guess.

The exit comes a little more than two months after Romo was arrested for operating while intoxicated on July 23 in the Milwaukee area, after competing in the Wisconsin Amateur Championship. Body camera footage showed him telling deputies he was visiting relatives before he failed field sobriety tests, and police found an open container of alcohol in his vehicle. He later pleaded no contest.

In a statement, Romo said he developed a reliance on pain medication after back surgeries from his playing days, which led to an "over-reliance" on alcohol. "None of this is an excuse. These are my failures, and I take responsibility for them," he said, adding that he plans to step away and focus on his health and family before pursuing another job.

Reviews of Romo's work in the booth had waned in recent seasons, AP noted. An OWI arrest is a convenient off-ramp from the back half of a contract signed at the top of the market.

CBS's parent, Paramount Skydance, is days from closing its $31-a-share cash takeover of Warner Bros. Discovery, with the deal expected to close Tuesday, Oct. 6. A newly merged media giant will be looking hard at every nine-figure talent contract on the books.

Former Houston Texans star J.J. Watt takes Romo's seat next to Jim Nantz and Tracy Wolfson on CBS's top NFL crew, while Ian Eagle, Ross Tucker and Evan Washburn stay together on the No. 2 team. Early reviews of Watt's fill-in work were mixed, praising his preparation while questioning his feel for big moments.

Tyler Durden Fri, 10/02/2026 - 18:50

Waste Of The Day: Defunct Veterans' Hotline

Authored by Jeremy Portnoy via RealClearInvestigations,

Contractors working at the Department of Veterans Affairs' suicide-prevention hotline earned $11.2 million without answering a single phone call, according to a Sept. 1 report from the VA inspector general.

Key facts: The Veterans Crisis Line is available 24 hours per day for veterans experiencing a mental health emergency. Trained government staff answer calls, provide support and send a medical team if there is an immediate risk of harm.

In 2019, a contractor was hired to establish a backup crisis line. If the main Veterans Crisis Line was unavailable because of a power outage or some other emergency, contractors at the backup center could answer calls.

The backup center hired new staff in 2022, but the government assumed they would not need security clearance to do their job. They were wrong; the contractors needed to record calls and document veterans' identity and mental health issues. That requires authorization from the General Services Administration, which typically takes 12 to 18 months to obtain.

Without clearance, the contractors were left to essentially sit and twiddle their thumbs. They did not answer a single phone call from a veteran from July 2022 until the contract ended in June 2023.

But a bureaucratic mess allowed the contractor to keep getting paid. Some employees said they did not realize the contractor was not doing any work. Others said they were waiting for a formal notice from a supervisor instructing them to cease payments. In March 2023, one employee even rated the contractor's work as "satisfactory."

Even with proper security clearance, the contractors might have failed to do their job properly. The company was required to staff the backup center with 92 employees, but there were less than 50 people actually assigned.

Before the contractor was hired, the VA started making its own in-house backup call center, raising questions about why the company was hired in the first place.

Summary: According to the audit, veterans are twice as likely to commit suicide compared to other Americans. Taxpayer resources must be used to provide them the resources they need, not to pay contractors without a purpose.

The #WasteOfTheDay is brought to you by the forensic auditors at OpenTheBooks.com.

Tyler Durden Fri, 10/02/2026 - 18:25

Protecting The Indispensable Right: It Is Time To Pass The Free Speech Attorney's Fee Legislation

Authored by Jonathan Turley via JonathanTurley.org,

A newly proposed bill in Congress could make a meaningful difference in the fight to restore free speech protections in higher education. The Restoring Civil Rights Attorney's Fees Act of 2026 would address a practical problem for civil rights and free speech groups suing public universities for the denial of free speech. When universities lose at the preliminary injunction stage, advocates cannot recoup costs and fees. The bill would allow that recovery and, as a result, level the playing field with universities, which can tap public funds to litigate these cases.

We have discussed many cases where universities spend millions in public funds to support anti-free speech policies and actions. A relatively small group of public interest groups have waged these battles with a collection of individual attorneys. Universities know that a case ending in a preliminary injunction will not result in fees or costs being paid to the victorious litigant. This bill would change that.

In my book The Indispensable Right: Free Speech in an Age of Rage, I suggest various ways that Congress could reinforce free speech rights, particularly in higher education. This is precisely the type of measure that can help tangibly support that effort.

The problem that we have faced in the free-speech community is that faculty and administrators have created an echo chamber in higher education by purging departments of dissenting voices, particularly conservative and libertarian faculty. Once in control of these universities, officials proceeded to tap into public funds to not only reinforce this ideological orthodoxy but also finance litigation.

Universities routinely lose these free speech cases. However, they know that cases that end at the preliminary injunction stage will often deny litigants the ability to recover fees or costs. In Lackey v. Stinnie (2025), a divided Supreme Court ruled that plaintiffs who received only a preliminary injunction before their case became moot were not "prevailing parties" eligible for fees under federal law.

The result is the use of public funds to drain the resources of free speech groups and advocates. It also adds a coercive element as universities pressure advocates to settle cases by noting that, if they secure a P.I., the university could fold and leave them without any recovery. They are literally using the public coffers to fight against free speech rights supported by the vast majority of citizens.

Congress can close this loophole and level the field. It will not transform higher education, but it will help guarantee that dissenting faculty and students have a fair chance against state universities.

The legislation is also important because, as I discuss in The Indispensable Right and prior columns, public universities are the final line of defense for free speech. Since the First Amendment applies directly to these universities, free-speech advocates have a greater ability to defend free speech and minority viewpoints at these schools. This can offer students an alternative to private universities as they seek environments with a modicum of tolerance (even if forced) for opposing viewpoints.

It is time to pass the Restoring Civil Rights Attorney's Fees Act of 2026.

Jonathan Turley is the best-selling author of "Rage and the Republic: The Unfinished Story of the American Revolution."

    OCTOBER ONLY.$10 OFFYOUR NEXT ORDER.$30 min. Ends Oct 31. One per customer.GET MY $10 OFF →Signs you up for ZeroHedge Store emails. Can't be combined. Every order helps support ZeroHedge. Tyler Durden Fri, 10/02/2026 - 17:40

CEO Warns The 2028 Election Will Be A Brutal Referendum On This One Thing

Some of Silicon Valley's biggest AI boosters are warning that artificial intelligence could become a defining issue in the 2028 presidential election as voters grow increasingly uneasy about the massive infrastructure buildout needed to power the technology.

Box CEO Aaron Levie told the Andreessen Horowitz podcast that the next presidential contest could effectively become an "AI election," forcing candidates to confront growing public anxiety surrounding the technology.

"The next election will 100% be a referendum on AI," Levie said. "So it has to happen that 2028 is the AI election."

.@levie predicts on the @a16z podcast that the 2028 election will be a referendum on AI. pic.twitter.com/pXPPsYbYDl

— Josh Caplan (@joshdcaplan) September 30, 2026

Levie argued that supporters face a messaging problem because making the case for rapid AI development is complicated, while opposition can be communicated through simple warnings about its potential dangers.

Steven Sinofsky, a board partner at a16z and former Microsoft executive, argued that AI skeptics have already seized control of the language surrounding the debate.

"We own none of the vocabulary," Sinofsky said. "The whole debate is pause. It's swarms. It's rogue. Every word has been chosen by the people who don't want to do AI."

The warning comes as President Donald Trump aggressively pushes to cement American dominance in AI, including by accelerating construction of the data centers and energy infrastructure required to support the technology.

The Trump administration's National Policy Framework for Artificial Intelligence calls on Congress to streamline federal permitting for AI infrastructure while ensuring residential customers do not face higher electricity bills because of new data centers.

However, public opinion suggests selling that buildout could be a political death trap for candidates seeking the highest office in the land.

A Fox News poll conducted September 11-14 found 71% of registered voters oppose an AI data center being built in their area, including 46% who strongly oppose one. Just 26% support local construction.

To make matters worse, the skepticism extends beyond where the facilities are built. A September Marquette Law School Poll found 71% of Americans believe the costs of data centers outweigh their benefits, compared with 29% who believe the benefits outweigh the costs. The survey also found 64% believe AI is bad for society, while 36% consider it a good thing.

The Trump administration has sought to tackle one of the biggest sources of voter concern: electricity prices.

Under Trump's Ratepayer Protection Pledge, major technology companies including Amazon, Google, Meta, Microsoft, OpenAI, Oracle and xAI agreed to build, bring or buy new power generation and cover infrastructure upgrades required for their data centers rather than passing those costs onto households.

Tyler Durden Fri, 10/02/2026 - 17:20

Newsom Tells California Agencies To Keep Saying AI Despite Trump 'Super Intelligence' Order

Authored by Chase Smith via The Epoch Times,

California Gov. Gavin Newsom on Sept. 30 ordered state agencies to keep using the term "artificial intelligence," one day after President Donald Trump directed the federal executive branch to replace it with "super intelligence."

Newsom signed an executive order saying all agencies and departments under his authority "shall refer to Artificial Intelligence and AI as 'Artificial Intelligence' and 'AI,' notwithstanding any rebranded or different terminology used by the federal government, unless inconsistent with the law."

The order says that while terminology can have significance, "purporting to change something's name cannot distract a person of normal intelligence from recognizing the impotent and craven failure to take action to address well-documented emerging security and safety risks posed by that thing."

The order does not name Trump or the White House - however, an accompanying statement by Newsom does reference the president.

"Super intelligence is clearly not coming from the White House - that's why California continues to lead," Newsom said in a statement.

He said AI should expand opportunity rather than come at the expense of workers and families.

    OCTOBER ONLY.$10 OFFYOUR NEXT ORDER.$30 min. Ends Oct 31. One per customer.GET MY $10 OFF →Signs you up for ZeroHedge Store emails. Can't be combined. Every order helps support ZeroHedge.

In response to a request for comment on Newsom's order, the White House pointed to recent public remarks by Trump.

"We don't call it artificial intelligence because it's not artificial. It's real. It's a terrible word," Trump said. "It's amazing it lived on so long, actually."

"We looked at 'superior intelligence.' We looked at 'supreme intelligence,' but I didn't want to mix it up with the Supreme Court - get myself in trouble," he said. "Artificial means it's fake or it's false, and this is not. This is real."

Trump added the United States and China are the only two countries competing in the field, and that the United States is "leading them by a lot."

"Whoever wins super intelligence wins," he said.

Trump's order, signed on Sept. 29, directs agencies, "to the maximum extent permitted by law," to use "Super Intelligence" and "SI" in place of "Artificial Intelligence" and "AI."

It says the executive branch "will not acknowledge the usage of 'Artificial Intelligence' and 'AI' in any applicable setting."

That covers official correspondence, public communications, websites, reports, policy documents, and other non-statutory documents.

It does not require changes to previously issued regulations, contracts, grants, or other historical documents.

The order says the new term "more appropriately captures the promise, potential, and rapidly advancing capabilities of these technologies."

A White House fact sheet says the order also directs the president's science adviser to propose a federal definition of "Super Intelligence" within 60 days.

Newsom signed 13 bills on Sept. 30 addressing AI in the workplace, health care, digital watermarks, deepfakes and digital replicas, legal work, and gene synthesis companies, his office said.

It described the workplace measures as the nation's first.

They prohibit employers from relying only on AI when making a disciplinary or termination decision; require employers to disclose when an AI system causes a mass layoff, relocation, or termination; and ban workplace surveillance tools in bathrooms, according to the governor's office.

"Workers across California have demanded that our state lead the way in regulating AI in our workplaces. And today, we see that begin to happen," California Federation of Labor Unions President Lorena Gonzalez said of four of the bills.

She said the bills show how to "put guardrails on AI at work" and "put workers first."

Tyler Durden Fri, 10/02/2026 - 17:00

Brazil Braces For Election Volatility As Bolsonaro Gains On Lula, Bullish Options Bets Explode

The big election focus this weekend will be on Sunday, with the latest polling data showing right-wing Senator Flávio Bolsonaro and socialist President Luiz Inácio Lula da Silva are statistically tied. Polymarket, meanwhile, shows Bolsonaro with a wide lead.

Bloomberg reports that neither Bolsonaro nor Lula is expected to secure an outright victory in Sunday's first round of voting. This suggests that a second round on October 25 is highly possible.

For weeks, we've outlined that high volatility is expected in the Brazilian currency and stocks after this weekend's first round of voting.

Traders are increasingly positioning for former President Jair Bolsonaro's eldest son to beat the socialist. As we've pointed out, this could set up the next big squeeze.

So far, the election trade in Brazil is gathering steam: currency volatility is surging, bullish stock options have erupted, and Polymarket odds give Bolsonaro roughly a 55.6% chance of winning.

The Brazilian real's one-week implied volatility has jumped above 31%, its highest level since late 2022. That exceeds the one-month measure, which captures both voting rounds but remains below 25%, highlighting the extreme concentration of risk ahead of Sunday.

Open interest in options on the iShares MSCI Brazil ETF (EWZ) has hit a record of 9 million contracts, driven mostly by calls. Demand for bullish options on the main equity benchmark Ibovespa index has also increased since late August.

Citigroup and JPMorgan analysts have told clients to use options that would benefit from a stronger real, while Brazilian hedge funds, including Ibiuna and Verde, have told clients they have positioned themselves with options for a potential stock rally.

"We expect the biggest surprise to come in the first round, with Flávio likely to finish ahead of Lula," Fabricio Taschetto, CIO at Ace Capital, wrote in a note. He added that the market reaction could exceed the move already priced into options.

BofA analyst David Beker told clients, "Brazil outperformed LatAm and global markets this week. Focus is on the first round of elections on Sunday."

Tyler Durden Fri, 10/02/2026 - 16:40

Schumer & The Democrats' "Alinsky-Grade Cloud Of Gaslight"

Authored by James Howard Kunstler via Clusterfuck Nation,

The Ancient Parable

"I will throw you in prison. I want Chinese style communism to happen inside of the democratic party right now. I want to do cultural revolution shit."

- Hasan Piker, DSA Spox

Translation: Chuck Schumer knows that the Democrats have already been thwarted from rigging the election, from flooding the polls with illegal immigrant voters, with dead voters, with voters who moved out of state but still got mail-in ballots sent to their old addresses, with voters registered as living in Walmart parking lots, and so on. Chuck Schumer knows that the Civil Rights Division of DOJ is sending hundreds of lawyers to observe the action in swing state polling places. ICE might even be on hand to see who turns up.

So, Chuck Schumer is pretending that the Republicans will try to do what the Democrats actually did in several previous elections (including the last midterm, 2022, viz., AZ, GA, NV), and would have liked to do in this midterm, but can't. The Democrats will holler like crazy about it before the election to plant this idea in credulous minds. They will jump up and down going woo-woo-woo on Election Day itself to water the idea. And after the election they will blitz every critical precinct with lawsuits to prevent the vote from being certified, using select "activist" judges to issue TROs and writs to delay election results and de-legitimize the vote.

And if none of that avails - which it won't - they'll call out their ground troops, Antifa, BLM, Free Palestine, LGBTQ2S+, the furious transsexuals, the hysterical cat ladies, and suchlike to make a giant ruckus so as to provoke the president to invoke emergency powers to quell the mayhem. And then they'll point at Mr. Trump shrieking, "See! Tyrant!"

Chuck Schumer is such a shithead. Everybody knows that he intends for the Democratic Party to inflict lawfare and commit warfare on the midterm election (in that order), and hence on the American people, behind an Alinsky-grade cloud of gaslight claiming the other side is doing it.

Of course, it's the president's constitutional duty (Article II, Section 3) to take care that the laws be faithfully executed. You have seen that Mr. Trump is taking a good deal of care vis-à-vis this midterm election to avoid any hint of interference. You can infer that's at least one reason we have seen no indictments of the Deep State sedition artists operating so brazenly since 2016.

By the way, doing what's possible to make sure that only citizens can vote is taking care to faithfully execute the law, in case there's any question about that. A September 25 SCOTUS decision in Department of Homeland Security v. League of Women Voters (No. 26A308), a 6-3 majority (usual suspects dissenting) paused by lower-court judge Sparkle Sooknanan that had blocked the Dept. of Homeland Security's Systematic Alien Verification for Entitlements system - further proof that the Lefty-left won't abide any restrictions on who can vote.

The SCOTUS stay allows state and local officials to match their voter rolls against federal Social Security records, to sort out who can legally vote. AI could do this with novel efficiency. The catch is, states' participation is voluntary. Only twenty-seven states have moved to participate in this record-sharing. Another catch is that SCOTUS waited, for unknown reasons, before issuing their ruling until well into the "90-day rule window" (in the National Voter Registration Act) that doesn't allow actual changes in the voter rolls during this period, only identification of problems. We'll see if any of that dissuades non-citizens from attempting to cast a vote.

You have to wonder why the Democratic Party is acting like they've already won the midterms. After ten years of narrative control through their allies in the network media and what's left of the major newspapers, the Democrats apparently believe that if you assert an outcome often enough, Oprah Winfrey style, it will come true.

It's just another gaslighting op. Look at the Democratic Party's marquee candidates, a ragtag and bobtail of avowed jihadis, communists, neo-Jacobins, and plain old creeps such as Abdul El-Sayed in Michigan, Melat Kiros in Colorado, Darializa Avila Chevalier and Claire Valdez in New York, Angie Nixon in Florida, James Talarico in Texas, and Troy Jackson up in Maine. The old Chuck Schumer / Hakeem Jeffries wing of the party pretends to support this rabble, who have declared they are merely running under the party's banner for convenience and aim to deep-six the likes of Schumer and Jeffries at the first opportunity.

Will the Democrats still try to cheat their way through the midterms despite the obstacles and disincentives piling up around them? Probably, yes, because that will trigger conflict between the states and the Feds, and post-election chaos is what the party needs to keep hope alive, as they like to say. They want the results to remain in limbo as long as possible, with maximum lawfare around it to further confuse and confound the outcome.

It's in their nature. They are the scorpion riding the frog across the river in the ancient parable.

Tyler Durden Fri, 10/02/2026 - 16:20

The post New York Times Pushes Trumpian Lies on the Economy appeared first on CEPR.

Seagate, Western Digital Crater After Toshiba Breaks Hard-Drive "Supply Discipline" Pact

For most of 2026, the bull case for the HDD duopoly could be summarized in one sentence: nobody is building new factories. On Friday, someone did.

Shares of Seagate (STX) and Western Digital (WDC) tumbled more than 10% on Friday, standing out like a sore thumb on a day when the Nasdaq hit all-time highs, after Nikkei reported that Toshiba plans to double its hard disk drive production capacity to grab a bigger slice of the AI data center storage boom.

This is how Goldman's TMT desk summarized the Nikkei story first thing in the morning (full note available to pro subs):

Japanese technology group Toshiba plans to double production capacity for hard disk drives used in artificial intelligence data centers within fiscal 2027 as the AI boom propels data storage demand. The company will invest roughly 60 billion yen ($380 million) to expand facilities in the Philippines... The Japanese player's share by storage capacity stands at just over 10%, but it aims to reach 30% in the medium term. The Philippine expansion marks the company's first major HDD investment in around five years. Along with adding production lines at the plant, Toshiba will handle new products that increase per-unit memory capacity by as much as 40%.

By midday, Goldman's US equities desk flagged the "memory names, WDC (-10.9%) and STX (-11.6%)" as the "standout laggards" in an otherwise green tape, where AI winners were up 1.4% and NDX and NVDA had just printed all-time highs.

To be sure, a 10% drop is just a flesh wound for stocks that have tripled. Even after Friday's puke, STX is still up some 208% YTD and WDC is up 141%, compared to a "mere" 22% for the Nasdaq 100.

But when you're priced for perfection, it's not the size of the hit that matters, it's where it lands.

The One Thing That Wasn't Supposed To Happen

Recall that the entire HDD up-cycle (as well as memory, chips, etc., pretty much everything in the semiconductor commodity chain) has been built on the premise of supply discipline, i.e., that none of the three remaining hard drive makers would add unit capacity, and that all exabyte growth would come from cramming more terabytes into each drive. Here is how Bernstein put it after hosting Seagate management on a non-deal roadshow in August (emphasis ours):

None of STX, WDC, or Toshiba are adding drive unit capacity, keeping industry-wide HDD supply structurally disciplined. Seagate management explained that its factories are effectively full, and rather than expanding units, management is targeting roughly 25% CAGR in nearline exabyte shipments purely by increasing capacity per drive via HAMR... building a new factory would take at least two years, which management has no plans to do.

Bernstein then went on to make STX its top pick precisely because "the broader industry's inability to scale supply keeps supply disciplined."

Well, oops: as of this morning, a third of "the broader industry" just announced it is scaling supply.

Regular readers will recall that we have seen this movie before. Back in May, in "China Begins Flooding The Market With DRAM And NAND Chips", we noted that Seagate's CEO had told JPMorgan that building new factories would "take too long," and warned that once someone else steps in to fill the supply gap, the supply tightness that justified the memory ETF rally would collapse. That time it was CXMT and YMTC on the memory side, which is only getting started with the old Chinese "capture market share by dumping products at below market prices" trick. This time it's an old friend in spinning rust, and it happens to be in the Philippines rather than Hefei.

And yes, the timing is apt for another reason. Rosenblatt points out that hyperscalers are now negotiating long-term agreements (LTAs) extending into 2029-2031, and Toshiba's expansion "introduces a credible medium-term supply risk, giving customers incremental negotiating leverage." Evercore adds that while Seagate "has allocated the majority of its nearline exabytes into calendar year 2028," Western Digital is still "negotiating long-term agreements extending to calendar year 2031." Put differently: 2027-28 pricing is largely locked in. What the market is repricing is the back end of the curve, which, for stocks trading on out-year earnings power, is the part that matters.

"Overdone"... Says Everyone With A Buy Rating

Predictably, the sell-side, which is unanimously bullish - and very wrong today - on both names, rushed to defend the duopoly. The best arguments:

• Citi (Buy, WDC PT $740, STX PT $1,300) argues the bottleneck isn't Toshiba's factory but its suppliers: "Unlike STX and WDC, Toshiba does not internally source their own media and heads," so "in order to double their current EB capacity they would also need their external component suppliers to also significantly raise capacity – which we believe could limit the impact of total EB supplied to the market."
• Morgan Stanley (Overweight, buying the dip) says "the gap between HDD supply and demand through calendar 2028 still looks wider than Toshiba's planned addition," and notes Toshiba lacks leading-edge capacity and heat-assisted magnetic recording (HAMR) technology.
• Rosenblatt (Buy, WDC PT $800, STX PT $1,400) reads the news as "more about Toshiba reclaiming lost market share rather than the stated 30% market share ambitions," and continues "to see support for sustained pricing power from a worsening supply demand imbalance due to AI."
• Bloomberg Intelligence says the plan "looks more like validation of stronger AI and data-center storage demand than a near-term supply threat."

Translation: Street targets now sit 50% to 90% above Friday's price, which is either a screaming buy signal, or more correctly, a reminder that price targets tend to follow price, not the other way around.

Goldman, for its part, didn't need to rush out a defense because it already had one on file. At last month's Communacopia conference, Goldman's James Schneider came away from Seagate CFO Gianluca Romano's presentation with three takeaways:

1. Seagate sees strong demand trends as continuing to support pricing uplift and margins through FY27;
2. HAMR volumes well on track to cross over PMR by the end of calendar 2026;
3. The company expects to continue high-yield debt retirement and pivot to share repurchases.

And just this week, Goldman's Korea memory team, reading across from Micron's results, said it expects "2027 and 2028 memory S/D to be much tighter than 2026," with customers "requesting longer duration and larger supply" agreements. Not exactly the backdrop for a glut.

The HAMR Moat

The real question is whether Toshiba's doubling matters as much as the stock reaction suggests. Some napkin math: going from "just over 10%" of industry exabytes to roughly double that by FY27 adds something like 10% to total industry exabyte supply, spread over two years. Meanwhile, Seagate alone is targeting ~25% nearline exabyte growth per year through HAMR. In other words, Toshiba's plan sounds big in a headline, but in exabyte terms it's a rounding error relative to what the HAMR transition is already adding, if, that is, Toshiba's head and media suppliers cooperate (see Citi above).

Which brings us to the part of the story the market may be glossing over: this isn't a level playing field. Seagate is the only player shipping HAMR at scale, and as Bernstein showed, its areal density lead already translates into faster exabyte growth than WDC...

... and, per Bernstein's forecasts, a gross margin that crosses above WDC's in FY27 and keeps climbing toward the mid-60s.

Which is also why Bernstein, back in August, said that while "a rising tide is lifting all boats," STX's HAMR lead "is why it is our top pick." If the tide is now going to recede a bit as Toshiba adds supply, the boat with the weakest areal density roadmap is the one most exposed. Hint: it's not Seagate, which may explain why WDC is now down more from its June peak than STX.

Meanwhile, The Picks And Shovels Rally

One more thing: equipment names catching a bid on the news included Veeco (+11%), whose data storage business sells ion beam deposition and etch tools used to make HDD read/write heads, i.e., a direct beneficiary of anyone (Toshiba or its suppliers) adding head capacity. Aixtron (+7%) also rallied, although its MOCVD tools are mostly used for compound semiconductors (GaN, SiC, optoelectronics), so the HDD link there is tenuous at best.

Bottom Line

The analysts are probably right that Toshiba's ¥60 billion won't put a dent in HDD pricing through 2028: the volumes are sold, the LTAs are signed, and Toshiba still needs someone to sell it heads and platters. But the market wasn't pricing the next two years; it was pricing a decade of monopoly-like discipline in an oligopoly of three.

The lesson from today is one which the rest of the world (and especially European car makers) are painfully familiar with: in commodity hardware, the cure for high prices is high prices, and sooner or later somebody in Asia builds a factory.

Whether this is the start of that cycle or just another buyable dip in an AI super-cycle (the sell-side which stands to make a killing the longer the AI bubble rolls on unanimously votes for the latter, understandably) will depend on one thing: whether Seagate and WDC respond with capacity plans of their own. If they do, the "supply discipline" thesis is over. If they don't, Toshiba just bought itself some market share at the top of the cycle.

Tyler Durden Fri, 10/02/2026 - 15:47