Individual Economists

"I Hope It Gives A Really Good Lesson Going Forward": 'Pollster' Prakash's License To Lie

Zero Hedge -

"I Hope It Gives A Really Good Lesson Going Forward": 'Pollster' Prakash's License To Lie

Authored by Jonathan Turley via Jonathan Turley,

In this political season, there is one question that needs no poll: Rahil Prakash is a liar. The other thing we know is that he will likely get away with spreading fake polling results. Lies can be protected speech under the First Amendment and, while Prakash would not likely want to take a popularity poll, he is unlikely to face legal consequences for his "short-term social experiment."

We still do not know much about the twenty-one-year-old college graduate who reportedly admitted to releasing fake polling in the last election cycle.

What we do know is that he succeeded and such polls can influence critical campaign decisions. For example, his poll put the Democratic Socialist up by 23 points in Wisconsin and she surprised many by spending the final days campaigning in rural areas where she was expected to do worse. (She would lose by less than one percent of the vote). It is unclear where, had Hong known how close the race was, she would have spent the final days in higher-yield urban districts.

The story laid bare the vulnerability of modern polling, which was again wildly wrong in predictions in various races during the primaries. However, it also highlights a novel question of potential liability for knowingly spreading falsehoods. In this case, Prakash wanted the lie to spread and likely succeeded beyond his wildest imagination.

He told The Guardian that "I wanted to see if fake polls could really penetrate the ecosystem that easily. And as it turned out, it could." He created a website called Median Strategies and released fake polls in Democrat primaries in the Wisconsin governor's race, the Los Angeles mayoral race, and two statewide Nevada races. The polls were quickly picked up and spread throughout the "ecosystem."

He explained to the Guardian how easy it was: "I think my overall takeaway was that if you just make it look a bit pretty, it's rather easy for it to spread."

We do not know if Prakash had a political motive in showing certain candidates dominating in certain races.

He reportedly denied using his fake polls to play betting sites as part of the prediction market. He also denied being compensated or directed by any campaign to run the hoax.

That matters because using lies for financial gain can be a form of fraud. However, just being a liar is protected.

In United States v. Alvarez, the Supreme Court struck down the Stolen Valor Act and held 6-3 that it is unconstitutional to criminalize lies.

The case shows the dividing line. Xavier Alvarez was protected in claiming to have won the Congressional Medal of Honor as well as marrying a Mexican movie star, playing for the Detroit Red Wings, and rescuing the ambassador in the Iranian hostage crisis. However, if he had used those claims to receive veteran benefits or donations, he could have been prosecuted.

Many of us in the free speech community supported that decision and still oppose censorship systems that target what governments decide is disinformation, misinformation, or malinformation. Anti-free speech figures have long justified censorship by declaring views as false or dangerous.

While apologizing to a few campaigns for misleading them, Prakash still seems perfectly clueless about the ethics and impact of lying in elections. Indeed, he seems to entirely remove himself from the problem of spreading lies: "I hope it gives a really good lesson going forward in that we need to be very serious about these things and very serious in how, if one person can do this, what can a serious operation do in the future - a real, you know, operation for an organization, country, whatever."

Yeah, whatever.

The most revealing aspect of this controversy is not that some polling seems to lack any factual foundation for its predictions, but that some people lack any moral foundation for their actions. We have seen similar sites put out fake stories. Some do so for political ends, while others want to laugh at those gullible enough to trust them.

As with anonymous positions, the Internet gives people a certain license to say and do things that they would not do in their own name. Unlike Prakash, most are not exposed. They spread vicious, false stories and relish their sense of twisted power. While lacking the courage to speak in their own names (often in attacking those who have the courage to do so), they yield to their darkest or cruelest inclinations.

Prakash created a fake site to make it seem like this was not an anonymous, unreliable source. He found his chumps in the media who wanted to report the results without looking into the source. However, the "really good lesson" was missed by him: he was neither noble nor particularly clever, just another liar among the Internet's sad voyeurs and vagabonds.

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

Tyler Durden Mon, 08/24/2026 - 14:30

The Great Walkback: Sam Altman Admits He Was Wrong On AI's Economic Timeline

Zero Hedge -

The Great Walkback: Sam Altman Admits He Was Wrong On AI's Economic Timeline

For three years, Sam Altman has pitched the imminent, wholesale disruption of the global economy. This week, staring down the barrel of an IPO - based on a business model that's actively being 'wholesale disrupted' by China - the OpenAI chief executive quietly admitted he got the timing wrong. Appearing on David Senra's Founders podcast, Altman conceded that the economic upheaval he forecast following GPT-4 simply hasn't materialized - and that society is adapting far more sluggishly than he anticipated.

"I thought when we got to GPT-4, which was back in 2023, that very quickly after that there was going to be much more disruption, software businesses up for grabs right away, than it turned out to be," Altman admitted.

Of course, the technology isn't to blame... The problem, he said, is that human routine simply doesn't move that fast. "I think I was wrong about a few things, but one in terms of the speed: the economy just has so much inertia," said the guy who suggested letting AI entertain your kid in the car instead of talking to them. "People keep doing the same things, buying from the same company, wanting to use their tools the same way." Altman even admitted that he himself resists the AI coding tools his own company builds, defaulting to familiar workflows.

According to Altman, this is good news - since a slower ramp will cushion the economic and societal hit from rapid job losses. "I think this is actually a positive in many ways, and it's going to make this big transition go smoother and slower. I'm grateful for it," he said. Yet the concession itself remains unequivocal: "We've all been too ambitious on timelines. Even with this incredible technology, society and the economy will adapt more slowly."

For macro-skeptics and market analysts who have been warning that explosive capex has outstripped real-world adoption, Altman's well-spun answers are validation. Hundreds of billions of dollars have flowed into data centers, power infrastructure, and silicon on the premise of an economy remade overnight. Now, boy kavalier admits the broader economy has too much structural friction to cooperate. Put simply: you cannot re-engineer human behavior to accommodate an IPO roadmap - even as OpenAI reportedly lays the groundwork for a public offering with valuations floated as high as $1 trillion.

What could go wrong?

The Hardware Hedging: Nvidia as "Buyer of Last Resort"

Upstream suppliers are already positioning themselves for a cooling enterprise trajectory. A recent Wccftech report highlights how Nvidia is effectively serving as the "buyer of last resort" for its own GPUs. The chipmaker has earmarked roughly $7 billion for AI startup Poolside - allocating $6 billion to license its IP and acqui-hire its engineering team, alongside a $1 billion direct equity investment at a $12 billion valuation.

The deal establishes a massive internal demand sink to bolster Nvidia's proprietary open-weight Nemotron models. Should downstream enterprise demand taper off - precisely as Altman's observations on inertia suggest - Nvidia can simply re-route its silicon internally rather than letting excess inventory idle or margins collapse.

Altman also went on the offensive against the doomsday marketing of safety-centric competitors - most visibly Anthropic CEO Dario Amodei. Altman blasted the industry's "countdown to destruction" rhetoric as "the language of anti-human dictators," taking direct aim at what he termed the "benevolent dictator" narrative.

Under this framing, Altman argued, tech elites ask the public to surrender their autonomy and let a handful of "unelected" companies "make decisions for the world" in exchange for promised utopias like curing cancer and generating limitless wealth. To Altman, consolidating unchecked authority under the guise of existential risk is a far greater hazard than any rogue model.

It is a convenient pivot. Having conceded that his own timelines were oversold, Altman steers the conversation away from the capital cycle and toward Darioooo.

Tyler Durden Mon, 08/24/2026 - 14:00

Gold: From DC's "Enemy" To Its Last Hope?

Zero Hedge -

Gold: From DC's "Enemy" To Its Last Hope?

Authored by Matthew Piepenburg via VonGreyerz.gold,

As headlines from the Iranian “conflict” continue to leave the world guessing as to what, if any, military, political and financial solutions lie ahead, we can at least know this much: The approaching autumn looks a bit scary.

A Market Fall in the Fall?

The macro setting for our collective transition from summer to fall in 2026 is marked by rising yields across the western yield curve, from Paris to DC.

These rising yields, which represent the cost of servicing debt for nations and enterprises (i.e. stocks) already in debt beyond the sustainability mark, are nothing less than flashing warnings of Uh-Oh ahead.

As of this writing, for example, the yield on the 10Y UST has climbed past the Rubicon of sanity to a dangerous 4.7% at the same time trillions of outstanding USTs face a re-finance at much higher rates.

Needless to say, U.S. tax receipts and GDP will not be enough to pay for the same.

More Non-QE-QE…

This means we can expect more “Non-QE-QE” from a debt-trapped and fork-tongued Fed which will need to create trillions in more back-door liquidity (i.e. synthetic dollars) off the Fed’s balance sheet to avoid having to say the embarrassing “QE” word out loud.

Toward this desperate end, Warsh has familiar tricks up his sleeve to keep the TBTF banks (the Fed’s real mandate) temporarily liquid at the expense of Main Street inflation and employment stresses (which are the Fed’s pretended mandates).

In addition to draining liquidity from the Treasury General Account, bailing out the Repo markets or issuing more unwanted IOUs from the short end of the yield-curve,Warsh, talking like a hawk, will be dovishly adding a trillion dollars of levered capital to the big banks by simple non-compliance with the Basel III rules, a maze so complicated that no one on Main Street is expected to notice.

Meanwhile, as Japan, formerly America’s largest buyer of USTs, has become a massive seller of the same, this latest threat to Uncle Sam’s unloved IOUs is being “solved” by more indirect QE conveniently described as “repurchase agreements.”

But in plain English, all these “repurchase agreements” boil down to is this: The moment Japan dumps USTs, the Fed is buying them at volume in a near-term attempt to keep bond prices (and hence yields) under control with printed dollar demand for otherwise unloved USTs.

This is just a diet-Coke version of Yield Curve Control and hidden QE by another name.

America’s Check-Mate Moment

In short, as the world foreseeably dumps weaponized and over-indebted USTs at a record pace in favor of gold-stacking at an equally record pace (driven primarily by the Chinese), the writing on the U.S. debt wall couldn’t be more clear: American debt management has reached its checkmate moment.

There are no good moves left.

If the Fed allows rates to go higher to “fight inflation,” this will crush everything but the USD in its wake—from stocks and bonds to BTC and yes, even gold–temporarily.

But eventually, higher rates just hit a wall of Fiscal Dominance wherein the rates become too high for even Uncle Sam to pay its own debt.

As a result, more dollar debasing QE inevitably follows, as we saw in the wake of Powell’s attempt at Higher-for-Longer in 2022 and 2023, after which gold ripped to all-time-highs in the years (and liquidity) that followed.

Alternatively, if the Fed uses extreme liquidity for extreme YCC (which it always ends up doing), this just “saves” its bond market at the direct expense of its currency, which leads, once again, to yet another tailwind for gold.

The Dollar (and Gold’s) End-Game is Clear

What all of these broad strokes ultimately point to is this: The dollar’s mathematical end-game is weaker not stronger; which means gold’s end-game is stronger not weaker.

This is not only a consequence of the hard math of debt, it is the very goal of a now desperate DC which is increasingly in favor of a weaker rather than stronger dollar to achieve its “Hamiltonian” new direction of allegedly making America “great again.”

As for this new direction, Treasury Secretary Bessent all but confessed this in a recent WSJ op-ed, and even Trump, knowingly or unknowingly, said the “Hamiltonian” part out loud when bragging about returning to the “policies of 1870 to 1913.”

But just what is this “Hamiltonian” new direction?

Going Hamiltonian

In a nutshell, it boils down to Hamilton’s 1790 version of building a then emerging American productivity base via extreme protectionism and hence otherwise unfair tariff practices.

This effectively meant that foreigners rather than Americans would pay for America’s own growth (or post-civil war re-growth).

Such protectionism made sense when America was an emerging nation in the 1790’s, or seeking to re-build its economy after the U.S. civil war ended in 1865.

But as America celebrates its 250th national birthday in 2026, this return to Hamiltonian thinking looks a tad more desperate than innovative.

Since the U.S. outsourced American manufacturing to China under the WTO deals of 2000 and 2001 (nod to Clinton), a country once known for manufacturing became an outsourced nation of factory lay-offs and extreme financialization rather than domestic manufacturing.

This was a disaster.

Rather than open China’s market as a great “purchaser” of American widgets, the WTO deal, with the complicit support of American CEO’s seeking cheaper labor and higher personal incomes/margins, simply opened China up as the greater manufacturer of American widgets.

Now the Trump white house seeks to reshore American manufacturing and labor, which on its face, is more than reasonable and very much needed.

Hamilton in 2026?

But here’s the rub: Reshoring is expensive. And the U.S. under Trump, unlike Hamilton’s 18th-century America, is staring down the fatal barrel of $40T in public debt.

This is a debt figure which must surely have Alexander Hamilton rolling in his Manhattan grave.

In order for DC to re-shore American manufacturing in such a debt backdrop, it will need a weaker dollar to both inject the needed capital as well as compete in a trade war which requires a weaker rather than stronger dollar for its export advantages.

On the other side of the Hamiltonian (i.e., protectionist) camp in DC are the classic neo-liberalist or globalist policy makers who prefer free flows and free trade to get the lowest prices on goods for American citizens.

Naturally, cheaper TV’s made in China or Japan are nice for American shoppers at Walmart, but it’s hardly much of a trade-off to haver cheaper TVs in American living rooms at the expense of millions of laid off workers in the U.S. rust-belt.

Make the Dollar Weak Again

Thus, for Trump and/or Bessent to make American manufacturing “great again,” a weaker dollar is not just a debate, it’s essential policy.

The problem is a weaker dollar helps DC, but the dollar debasement and inflation required to re-shore and re-build American productivity will hit Main Street hard in the gut via a dollar so diluted (and unsupported by equivalent wage hikes) that not even a comically bogus CPI scale will be able to hide the inflation metastasizing throughout America.

This means DC will need another way to pay for its Hamiltonian schemes than just protectionism and dollar-debasement gone wild.

The Golden Option

They will need another asset to monetize this ambitious project of American re-shoring. As Bessent himself hinted, it’s time to “monetize the asset side of the American balance sheet.”

To me, at least, this means it’s time to monetize the 260 million ounces of allegedly U.S.-held gold still priced at roughly $42.00/oz.

Such a revaluation of U.S. gold holdings (aided by the Venezuelan gold handed to Uncle Sam via the Bank of England) to market price would remove the embarrassment of more “QE” headlines and a too-rapid dollar debasement.

In short, such a gold revaluation would buy the USA something it desperately needs: Time and money.

From “Enemy” to Asset of Last Resort

But any re-valuation of U.S.-held gold would certainly do a lot more for the U.S. balance sheet if gold were marked to market at a higher rather than lower market price.

This places the U.S. at not only an historical decision point, but also an historical turning point as to its traditional view on gold.

Ever since the U.S. left the gold standard in 1971, gold was, as Volcker famously said, “America’s enemy.” After all, rising gold was an open middle finger to a post-71, nothing-backed dollar.

This early need to fight the golden “enemy” explains why the COMEX and CME tricks to legally price fix gold and silver began in earnest (along with the Petrodollar scheme) directly after the dollar decoupled from gold in August of 1971.

It was essential that rising gold be controlled to avoid humiliating the Greenback.

But 55 years later, the “exorbitant privilege” of the USD’s global hegemony is now stumbling under the self-inflicted wound of too much debt, a distrusted and weaponized IOU and a petrodollar in open shift in the wake of the Iranian fiasco.

As a result of these changing facts, and after decades of exporting US inflation to the rest of the world, the increasingly diluted and unloved dollar is no longer just the world’s problem, it’s America’s problem as well.

Which means that what Bessent and Trump (as well as Judy Shelton) are subtly suggesting is that gold is no longer our “enemy.”

Instead, and quite ironically, gold is now one of America’s last options to de-deficit at least a portion of its fiscal nightmare.

Rather than Repress Gold, Let It Run

Or stated even more simply, it is now in the USA’s best interest to let gold run rather than to price fix it lower on a COMEX which has lost both its gold and credibility as China and Hong Kong move from paper-based exchanges to physical precious metal exchanges.

Gold at $4,000/oz., for example, won’t help the USA de-deficit nearly as much as it could if gold were at $17,000/oz., $20,000/oz or higher (in fact much higher) in the years to come.

And if you are wondering why central banks are stacking more gold than USTs today, it’s partly because that is precisely where they see gold heading: Much higher…

Tyler Durden Mon, 08/24/2026 - 13:40

Nvidia Informs Hyperscalers About Incoming Price Hikes As Memory Costs Soar

Zero Hedge -

Nvidia Informs Hyperscalers About Incoming Price Hikes As Memory Costs Soar

The AI infrastructure buildout boom could soon enter another inflationary wave. 

Nvidia's largest hyperscaler customers face sharply higher costs next year, with Vera Rubin and Grace Blackwell systems expected to jump in price as surging memory costs ripple through the chip stacks.

Bloomberg cited sources familiar with Nvidia's new pricing regime, indicating that hyperscalers will see a 15% increase in prices for Rubin and Grace Blackwell processors next year. They said the size of the increase will depend on the chip generation and memory configuration.

Contract manufacturers serving major data center projects, including Microsoft, Google and Oracle, have started notifying customers about the incoming increases, those people said.

Nvidia's AI accelerators remain expensive and in short supply because production at Taiwan Semiconductor Manufacturing has struggled to keep pace with soaring demand. Nvidia generates gross margins of about 75%, but the latest increases suggest that even the world's most valuable semiconductor company is unwilling to absorb rising memory costs.

The coming price shock may intensify pressure on hyperscalers already committing hundreds of billions of dollars to AI infrastructure. Goldman has forecast that AI CapEx among hyperscalers will top $1 trillion next year:

Source

Meanwhile...

Higher chip-stack costs have sent the US Producer Price Index for semiconductors and electronic components to uncomfortable levels for the Trump administration as it tries to tame the inflation beast.

Beyond the surging PPI for chips, driven by rising chip-stack costs amid strong demand and a memory chip shortage, the AI race has also put pressure on US Treasuries, as record debt issuance funds CapEx. 

Tyler Durden Mon, 08/24/2026 - 13:20

Mole Men Return? Weird Manhattan Manhole Crew Spotted At 4AM

Zero Hedge -

Mole Men Return? Weird Manhattan Manhole Crew Spotted At 4AM

Authored by Steve Watson via Modernity News,

The manhole people are back.

Early Saturday morning, just after 4 a.m., a group was filmed exiting a manhole in Manhattan.

The footage, captured and shared by independent New York photographer Viral News NYC, shows the individuals climbing out of the street in the dead of night once again.

A clearer image of one of the men soon followed. Commenters immediately noted the resemblance: "Dude really looks like the Mexican Mario."

This is the latest odd chapter in a pattern that first gripped the city in late spring.

Groups of men in waders, boots, headlamps, and carrying tools have been repeatedly documented prying open manhole covers, disappearing into New York's vast sewer network for hours, then resurfacing to change clothes on the sidewalk before vanishing in waiting vehicles.

In June, there were a wave of sightings across Brooklyn and Queens.

Those incidents included a group of roughly seven men emerging around 2 a.m. from a manhole on McDonald Avenue in Gravesend after spending hours underground. Another crew entered near Heyward Street and Bedford Avenue in Williamsburg around 1 a.m. and exited more than two hours later. An earlier episode in Astoria, Queens, on May 5 showed three men in hip waders lifting a cover and descending while a vehicle idled nearby.

Surveillance from a local auto shop owner in Astoria captured one of those moments. Aki Jakupovic, who was working late, said the men "acted like I wasn't even there." One witness described the Queens group as looking "like the Ninja Turtles."

Police and the Department of Environmental Protection investigated the spring cases. Emergency Services Unit teams went underground. Officials reported finding no explosives, no damage to infrastructure, and "no known threat to public safety."

The leading explanation offered by sources was scavenging: men hunting for coins, wallets, jewelry, scrap metal, or other valuables that wash into the city's 7,400 miles of sewer pipes.

That theory has history. In 2015, a part-time city worker and two companions were arrested after spending four hours in Brooklyn sewers looking for "gold, jewelry and guns." Then-Police Commissioner Bill Bratton remarked at the time: "God knows what they were looking for. I know damn sure I wouldn't be crawling through the sewers of New York, but these three evidently were up to something down there."

A similar arrest in April 2025 produced a more straightforward confession from one of the men, Willer Green: "The reason we went down there is that people lose their gold down there. We got to sell it to make money."

Urban explorers consulted by WIRED in June largely rejected the idea that the recent crews were part of their scene. One creator put it bluntly: "There's nothing of value down there besides 'doo-doo water and a few needles.' And sewers are pretty risky because there is basically zero cell service down there."

Another observed that the groups appeared "way too sophisticated" and that multiple crews hitting different locations across the city "seems fishy to me. This might be more than just exploration."

The Department of Environmental Protection has been consistent on one point: unauthorized entry is "both illegal and extremely dangerous." Toxic gases, sudden flooding, structural collapse, and the complete lack of cell service make the system a death trap for the unprepared.

Yet the pattern continues. The latest Manhattan sighting comes months after the spring wave, with no public arrests, no named suspects, and no visible escalation.

A NewsNation discussion later examined the broader implications, including whether unauthorized access to critical underground infrastructure raises national security questions beyond simple scavenging.

New York's sewer system runs beneath banks, businesses, transit hubs, and sensitive sites. In a city that has absorbed large numbers of unvetted migrants under sanctuary policies, the repeated appearance of organized teams equipped for prolonged underground work is not a curiosity. It is a vulnerability.

Officials prefer the scavenger narrative. Residents watching the videos see something else: purposeful crews operating with near impunity in the middle of the night. The absence of swift consequences only deepens the skepticism.

When unidentified groups can repeatedly breach a major city's subterranean network and walk away, the "no threat" assurance starts to sound like institutional preference for quiet rather than clarity.

Your support is crucial in helping us defeat mass censorship. Please consider donating via Locals or check out our unique merch. Follow us on X @ModernityNews.

Tyler Durden Mon, 08/24/2026 - 13:00

Russia Scrambles To Restore Fuel Supplies As Refineries Resume Operations

Zero Hedge -

Russia Scrambles To Restore Fuel Supplies As Refineries Resume Operations

By Charles Kennedy of OilPrice.com

Amid the ongoing fuel crisis in Russia, authorities are rushing to ease concerns that the shortages are worsening.

Russia has been suffering from a gasoline and diesel crunch since the spring, when Ukraine intensified its drone attacks at Russian refineries, aiming to cripple fuel supply to the front lines and to the domestic Russian market.

The drone hits on refineries, including deep into Russian territory more than 1,000 miles from the border with Ukraine, have become a nearly daily occurrence.   

But Russia’s Deputy Prime Minister Alexander Novak, who is in charge of energy issues including Russia’s OPEC+ talks, sought to alleviate concerns on Monday.

Some oil refineries in Russia have resumed operations after repairs, which could soon raise supply on the domestic market, Novak told reporters today, as carried by Russian news agency Interfax.

“The current situation is constantly changing. Several refineries are already back in operation, therefore, we're expecting an increase in amounts of supplier taking into account logistics,” the official was quoted as saying.

“The situation is changing every day. We're constantly monitoring it and are making decisions at our headquarters. We're gathering the federal headquarters with the regions and all of our companies twice a week,” Novak said.

Russia has been scrambling to ease concerns amid the crisis that has seen fuel rationing in many regions, gas stations in big cities running out of fuel, and long queues at many gas stations.

Amid peak demand season, Russia has been suffering from gasoline and diesel shortages for over three months, as Ukraine’s drone campaign to strike Russian refineries forced many large processing sites offline in the spring and summer.

Russia has turned to South Korea and India for fuel imports as one or the other refinery is constantly out of service due to the Ukrainian attacks. 

Russia’s diesel and gasoil exports have crashed so far this month to the lowest in many years, as Moscow extended restrictions on diesel exports amid the fuel crisis. The lack of Russian diesel adds to Middle East supply disruptions to tighten the global middle distillate market.

Tyler Durden Mon, 08/24/2026 - 12:20

Transcript: Alex Morris, “Buffett and Munger Unscripted

The Big Picture -

 

 

 

The transcript from this week’s, MiB: Alex Morris, “Buffett and Munger Unscripted,” is below.

You can stream and download our full conversation, including any podcast extras, on Apple Podcasts, Spotify, YouTube (video), YouTube (audio), and Bloomberg. All of our earlier podcasts on your favorite pod hosts can be found here.

~~~

 

MASTERS IN BUSINESS Alex Morris, Author, Buffett and Munger Unscripted

 

BARRY RITHOLTZ (00:00:07): This weekend on the podcast, another extra special guest. Alex Morris is the author of “Buffett and Munger Unscripted.” The amazing story of how he put this book together: by reading and watching 31 years of annual shareholder meetings — thousands and thousands of questions, hundreds and hundreds of hours of video — distilled into a fairly digestible compendium. I thought the book was fascinating and the conversation was fascinating, and I think you will too. With no further ado, my interview of Alex Morris.

BARRY RITHOLTZ (00:00:54): I’m Barry Ritholtz. You are listening to Masters in Business on Bloomberg Radio. My extra special guest this week is Alex Morris. He is the founder of the TSOH Investment Research Service, launched in 2021 after 10 years as a buy-side equities analyst. He is the author of “Buffett and Munger Unscripted: Three Decades of Investment and Business Insights from the Berkshire Hathaway Annual Shareholder Meetings.” Amazon named it one of the best books of 2025. It’s pretty beefy — I’ve been reading it over the past, I don’t know, eight months. It’s about 500 pages, and I have really, really been enjoying it. In fact, I’ve been enjoying it so much that I reached out to Alex and said, let’s talk about your research and the book. He has been a Berkshire Hathaway shareholder since 2011 and attended multiple annual meetings, including the 2026 meeting, the first of the Greg Abel era. Alex Morris, welcome to Bloomberg.

ALEX MORRIS (00:02:03): Thank you for having me. As I was saying to you before, Bloomberg headquarters is quite a building.

BARRY RITHOLTZ (00:02:07): Nice place to be.

ALEX MORRIS (00:02:07): I’m gonna drop my resume on the way out.

BARRY RITHOLTZ (00:02:10): So before we get to your resume, let’s roll back to what led you to where you are today. Both a bachelor’s and an MBA from the University of Florida — was finance always the career plan?

ALEX MORRIS (00:02:24): It was not. When I went to school, I really didn’t have any idea what I was gonna do, and my dad’s a plumber, so at first I did building construction, and took a couple physics classes and some other things that kind of threw me for a loop. And then I got my first internship working down in Miami, outside all day, and fairly quickly realized, let me find something a little easier. So I went to finance.

BARRY RITHOLTZ (00:02:43): What were you doing, working outside all day in Miami over the summers?

ALEX MORRIS (00:02:46): What were we doing? We were working on a high-rise that was being built, and I spent most of the time running from the rain that came every single day at noon or one o’clock.

BARRY RITHOLTZ (00:02:54): I spent a summer in college working with a crew, building decks, swinging a sledge, breaking up the concrete of an old pool to put in a new pool. And nothing makes you wanna buckle down and study more than physical labor. It’s like, oh my God, this is really hard work. I have tremendous respect for people who do that. It really forces you to see the world in a different way, doesn’t it?

ALEX MORRIS (00:03:17): Yes. It’s very different work than sitting and writing a book, as you and I both know.

BARRY RITHOLTZ (00:03:21): So after you get your bachelor’s and MBA in finance, you take the CFA exam — it’s a two-part exam — and you spend a decade as a buy-side equities analyst. What did you learn from those 10 years on the buy side?

ALEX MORRIS (00:03:37): Yeah, a lot. I kept my head down and learned as much as I could every single day. The first job I started at, I was brought in and basically told, hey, you’re running all the research for equities, but also you’re the secretary and you’re doing the trading — you’re doing everything else. So I got a lot of good experience there, but it was a role where my boss really was like, just go do what you think makes sense to do, which works really well with my kind of disposition. And as time went on, I learned a lot from making a lot of mistakes — that’s a really good way to learn — a ton of reading, a ton of writing online and sharing stuff with people, getting good feedback. So yeah, just time and effort.

BARRY RITHOLTZ (00:04:10): That’s one of the big problems with everybody: here’s what a billionaire’s morning routine is like. You seem to learn more — all of us learn more from our errors and mistakes than we do from our victories. Do these guys have anything to say about that?

ALEX MORRIS (00:04:26): Oh, yeah. They say learn all you can, particularly from other people’s mistakes if you can. But that seems to be hard to avoid, at least for me and most of us.

BARRY RITHOLTZ (00:04:34): So after 10 years on the buy side, you launch an independent research service in 2021. What made you take that leap? What were those initial couple of years like?

ALEX MORRIS (00:04:45): Yeah, I’d been writing online going back to college, and I continued to write online under a pseudonym, Science of Hitting, or TSOH. And again, I had built a network over time. I really enjoyed the process of writing. I had started making some supplemental income through writing, and I looked around and I saw people like Ben Thompson of Stratechery and other people who had built a business online sharing their research, I wanna call it that. So when I saw Substack come around, and it went from having to understand anything on the technical side to write-in-Word, copy, paste — which is more my speed for technology — I decided to give it a shot. I said, I’ll give myself a year, and if it doesn’t work out, I’ll go find another traditional job, but I wanna see if I can do this. And thankfully, it’s worked out.

BARRY RITHOLTZ (00:05:27): And “The Science of Hitting” was a book by Ted Williams that Buffett loves to cite for the whole strike zone analogy. If you Google image search this, there’s a strike zone, and Ted Williams literally figured out every position a ball can be thrown — just picture a grid, 12 by, I don’t know, 20, however many it is — and figured out the batting average for when a ball hit that spot, how likely he was to hit it. Buffett loves that analogy. Why did you name your research service after it?

ALEX MORRIS (00:06:04): I’d say partly luck. I don’t know if at the time I knew it was an analogy that I liked so much, and that it would be a good name to keep for the next — you know, coming up on 15 years now. But it really spoke to the way I think about investing, in terms of being patient and then also making big swings when you get the chance to.

BARRY RITHOLTZ (00:06:21): Waiting for your pitch. And when it finally comes, don’t be afraid. So I’m gonna assume you’re not averse to a concentrated portfolio.

ALEX MORRIS (00:06:28): I’m not.

BARRY RITHOLTZ (00:06:29): How many holdings do you typically have at any given time?

ALEX MORRIS (00:06:32): In the range of 10 to 15.

BARRY RITHOLTZ (00:06:34): Oh, really? That’s very concentrated. So big, big swings after waiting for your pitch.

ALEX MORRIS (00:06:39): Yeah. And there’s names — like you said, I’ve owned Berkshire since 2011, I’ve owned Microsoft since 2011. Most of the positions have been in there for a period of years. So, you know, it tends to be things that I’ve come to know quite well and have gotten familiar and comfortable with.

BARRY RITHOLTZ (00:06:53): So this raises the obvious question: when did you first become enamored of Buffett and Munger, if you’ve been a shareholder since 2011? When did they first show up on your radar?

ALEX MORRIS (00:07:04): Yeah, the late 2000s, when I was in school. I stumbled across the letters, and actually a buddy and I both became obsessed with it. We were at the University of Florida, and we actually drove to one of the annual meetings in Omaha.

BARRY RITHOLTZ (00:07:16): It’s like a 10-hour drive?

ALEX MORRIS (00:07:17): No, it’s like 20 or 25.

BARRY RITHOLTZ (00:07:19): Oh, really?

ALEX MORRIS (00:07:20): It’s a long way.

BARRY RITHOLTZ (00:07:20): Wow.

ALEX MORRIS (00:07:21): And we were college kids with no money, right? So we slept in the car, I think, one or two nights.

BARRY RITHOLTZ (00:07:25): Wow.

ALEX MORRIS (00:07:26): So yeah, we were very interested in it.

BARRY RITHOLTZ (00:07:29): Wait, you’re college kids, you have no money — but you didn’t own Berkshire A or B back then?

ALEX MORRIS (00:07:34): I think I bought one share — a B share, to be clear. Just to go, for the sake of getting in.

BARRY RITHOLTZ (00:07:40): Right, it’s open to anybody who’s a shareholder. What was that first trip as college kids to the Woodstock of Capitalism in Omaha like?

ALEX MORRIS (00:07:49): I mean, it’s tough to remember now. I don’t know how productive the trip was, but it was more just being in awe of seeing everything and, you know, really starting to learn about investing. And I didn’t do much. Now when I go, I go to a bunch of events and other things and network with people. At that time, it was walking around the convention center eating Dilly Bars, something like that.

BARRY RITHOLTZ (00:08:07): So you have sort of the opposite version, the inverse version, of how the sell side or typical newsletters operate. You disclose your buy or sell before you make the trade. You tell your subscribers, this is what I’m planning on doing. Why run it that way? It’s the inverse of the typical way.

ALEX MORRIS (00:08:30): Yeah. I think one part of finance that I didn’t love was what I considered a lot of talking about things that weren’t really particularly meaningful. And a lot of discussions about things like, “we like Google stock,” for example — but then not a discussion around position sizing, or when you like Google, what are you gonna sell to fund Google? Those kind of more detailed discussions around portfolio management and decision-making. So when I launched TSOH, I thought one way to differentiate this is to just take everything away and be completely transparent about all my decisions, my returns, et cetera. And I thought there’d be a group of people — maybe not the largest group, but a group of people — who would connect with that, and, you know, I could build a sustainable business as a result.

BARRY RITHOLTZ (00:09:11): I recall way back when, watching some talking heads on TV, and when they’d say “we like Google,” or whatever stock it happened to be, the immediate question was, what does that mean? Does that mean you own it? Does that mean you’re holding it? What? Like, liking a stock is very different than “I have allocated 6% of my portfolio to this position.”

ALEX MORRIS (00:09:31): Correct.

BARRY RITHOLTZ (00:09:33): And post-analyst scandal, they used to put the disclosures on screen. We seem to have moved away from that.

ALEX MORRIS (00:09:40): Yeah. I mean, it’s tricky. It’s tough to get on there and kind of explain these things, and a lot of it’s not black or white — it’s in the gray, a lot of these decisions, and there’s a lot of mental accounting and decision-making. And I think it’s just a reality of being an individual and being an investor, and it’s figuring out what are you comfortable with and what game are you trying to play. And, you know, I think talking about that resonates with some people who are kind of honest with themselves about what this game actually is.

BARRY RITHOLTZ (00:10:05): So I like the hundred percent transparency and the disclosure prior to trading, but it raises one question. When you are this public, does it make it more difficult to change your mind, or say, hey, we got this wrong and we’re now selling this?

ALEX MORRIS (00:10:20): Yeah, and that’s probably fair. It’s never fun to be wrong, of course. It’s less fun to be wrong when you’re telling people that you were wrong and you’re dealing with the pain of that. You know, the way I write my research, I kind of view it as an ongoing discussion for a given name. So there’s a lot of opportunities to link back to prior work and go, hey, this call is looking good for X, Y, Z reasons, or looking bad for X, Y, Z reasons. It allows for a continuity of thought and a level of honesty and transparency that I think kind of makes it easier to deal with that issue.

BARRY RITHOLTZ (00:10:52): The reason I asked this question was due to a quote right from the book, which is Charlie Munger’s: “Show me the incentive and I will show you the outcome.” First of all, I think that could be the most quoted line of his of all time. But how do you contextualize that? Is the whole transparency an attempt to stay honest within the Munger framework?

ALEX MORRIS (00:11:19): Absolutely. And yeah, it’s part of — and it goes back to writing when I was much younger and didn’t know nearly as much as I hopefully do today — it’s part of this just being a continual learning process. And it’s with the subscriber, and it’s also me on my own. And I think we’re collectively moving to a place where we can become better investors, or at least more thoughtful investors.

BARRY RITHOLTZ (00:11:38): I like that concept of becoming a better investor. I don’t remember — the problem with the book is, was that a Buffett quote? Was that a Munger quote? They all kind of blur together. The compounding of knowledge that you’re referring to — I think that’s a Munger observation.

ALEX MORRIS (00:11:58): I forget as well.

BARRY RITHOLTZ (00:12:00): But one thing that he definitely said was, Warren Buffett got better after 65. “We’re both learning machines, and we spend most of the day reading.” Explain — these guys are running hundreds of billions of dollars, or at least they were, and they spend their day reading.

ALEX MORRIS (00:12:19): Yeah. I think it’s all about trying to expand your circle of competence and learning as much as you can. As we said, learning from the mistakes, and the mistakes of others. And it’s a game where — you know, I’m thinking, as I’m getting a little bit older, when I go running some time, my knee hurts more and more, while in investing, I’m still quite young, ’cause in theory I could be doing this for another 40, 50 years. And all I need to do is be able to sit in a chair, which isn’t that difficult. So yeah, as long as you put the time and the effort in and remain open-minded — which is a huge thing that I think especially traditional value investors, Buffett and Munger fans, the last 15 years have been a good lesson in, in terms of being flexible and willing to learn. And the world’s obviously changed very significantly. Just turning your mind off from trying to learn about tech, as an example — you can’t really do that anymore in today’s world. You have to be able to at least try to learn about some of these things.

BARRY RITHOLTZ (00:13:08): So I know at TSOH you cover a number of individual names — things like Netflix, Microsoft. Ten to 15 names is pretty tight. Tell us about some of your other names, and are you sitting tight with all of these?

ALEX MORRIS (00:13:21): Yeah, so as I said before, I’ve owned Microsoft and Berkshire for a long time. I’ve owned Disney for a while, which has not worked out, but thankfully it taught me things about the business that then led to a decent Netflix investment back in ’22.

BARRY RITHOLTZ (00:13:34): Why is that? I was curious why you think it didn’t work out. Was it Netflix as a threat, or was it something else?

ALEX MORRIS (00:13:43): They saw where the world was going too late, and in their ability to truly pivot and make the investments they needed to make, they were behind. I think they’ve done better than a lot of their peers, at least among the legacy media companies, but they were slow to the party. And I think especially with ESPN, they’ve struggled with, what really is our strategy going forward? They have their strategy on the entertainment programming side, but in live programming and sports, it’s still really a challenge of how do we get from A to B over time. And obviously sports are expensive. So it’s been an issue for them.

BARRY RITHOLTZ (00:14:13): And yet, go back a few decades, they were very aggressive. They bought Star Wars, they bought Pixar. Those seemed like — wow, those $4 billion deals, that seems crazy. Meanwhile, it’s been a giant moneymaker for them. Was it just a change of leadership at Disney? What led to this failing to recognize the changing world?

ALEX MORRIS (00:14:36): Yeah, I think the media companies got lulled into a place where they thought Netflix or these other channels were incremental, as opposed to replacing what they were doing. And by the time they figured that out, you know, you’d gotten through a period where Netflix had been investing very aggressively and was going global and getting scale in a way that nobody else has basically been able to catch up to. And it changed a lot of their negotiating position amongst each other, and also how they had to price their products, and the reach and engagement of those products. They’re in a really tough place — or have become in a really tough place — relative to Netflix’s rise.

BARRY RITHOLTZ (00:15:09): Give us one more holding that is intriguing.

ALEX MORRIS (00:15:13): Yeah. One that at one point I would’ve probably thought I’d never own — it speaks to what I said before about reading about a company and writing a company up and following it for a couple years — is Peloton. When they brought Barry McCarthy on as CEO, who used to be at Spotify, that’s where my interest came from. The company went through a transition process — it still continues to this day; he has since left. But the stock got to a point where it appeared to be very cheap—

BARRY RITHOLTZ (00:15:40): Post-pandemic.

ALEX MORRIS (00:15:41): Post-pandemic, yeah.

BARRY RITHOLTZ (00:15:42): It had a crazy run-up when everyone was stuck at home and couldn’t get to the gym. Obviously, as did others in that space, but they were the poster child, right?

ALEX MORRIS (00:15:51): Yeah. I mean, I think it was a $150 stock at one point, and recently it traded below $4.

BARRY RITHOLTZ (00:15:56): Wow. That’s a 96, 97% drop.

ALEX MORRIS (00:15:59): Yeah, it’s pretty amazing. I think there’s this question of, what are they dealing with that’s cyclical versus structural? And I think people have a certain view on it that is kind of informed by their anecdotal experience. But you look at other industries — like mattresses, for example — where volumes are still meaningfully below what they were during the pandemic. I think most people would argue that’s probably not structural. People still need mattresses, but the supply-demand got outta whack. And in Peloton’s case, they went from 500,000 paid customers to 3 million in 36 months.

BARRY RITHOLTZ (00:16:29): Paying a monthly subscription fee on top of everything. So it’s a little bit of a razor blade model as well.

ALEX MORRIS (00:16:33): Yeah. Now they’ve bled off half a million, so they’re at two and a half. But, you know, if you step back and in the fullness of time went, hey, you guys are gonna go from 500,000 in ’19 to 2.5 million in ’26, everybody would say that’s great. Their strategy got outta line, their cost structure got outta line — I think they’re rectifying that now. And again, you’ve got a stock that in my mind was incredibly cheap. So it went from something that I probably didn’t think I would’ve ever owned a couple years ago to — it has been my largest position lately.

BARRY RITHOLTZ (00:17:02): Oh, interesting. Give us one more.

ALEX MORRIS (00:17:04): Another one that I bought recently, or relatively recently, is Dollar Tree. I think it’s a really interesting retail concept that is kind of on its own in the retail landscape. I mean, everybody competes with everybody in retail, but their position, and who they serve, and what they sell to them, is unique.

BARRY RITHOLTZ (00:17:20): No threat from the internet at Dollar Tree?

ALEX MORRIS (00:17:22): No. No, there’s not.

BARRY RITHOLTZ (00:17:24): What about from Amazon, or places like that? Or Target, where — you know, I can’t remember the last time I stepped into a Target, but I get Target deliveries every couple of months on a regular basis. It’s so delightful not to have to spend a couple of hours doing that.

ALEX MORRIS (00:17:41): Yeah. Dollar Tree sells product at a price point — obviously, it’s very low. The average ticket’s really small. The immediacy of the purchase is a tight window. The ability to cost-effectively do it with delivery is challenging, to say the least. They owned Family Dollar for a long time, which is a Dollar General competitor. They tried to turn it around, and it didn’t work. So I was watching from the sidelines for a long time. As they got that resolved, they changed the strategy to basically replicate what a company called Dollarama has already done in Canada. And if you look at that, the stock’s been a great performer and the business has done particularly well. I think there’s a lot of sense in the strategic evolution that they’re making, and the stock got pretty cheap — I think I bought in the second half of ’24. So yeah, it’s a business — retail, again, obviously is intensely competitive, but there’s little niches that people play in that I think can be attractive, and Dollar Tree is one of those niches.

BARRY RITHOLTZ (00:18:33): Really interesting. Coming up, we continue our conversation with Alex Morris, author of “Buffett and Munger Unscripted,” discussing how he plowed through hundreds of hours and 31 years’ worth of material to write this book. I’m Barry Ritholtz. You’re listening to Masters in Business on Bloomberg Radio.

BARRY RITHOLTZ (00:18:44): I’m Barry Ritholtz. You’re listening to Masters in Business on Bloomberg Radio. My extra special guest this week is Alex Morris. He is the author of “Buffett and Munger Unscripted: Three Decades of Investment and Business Insights from the Berkshire Hathaway Annual Shareholder Meetings.” So I found the book fascinating, but before we delve into the content, I have to discuss your process. Back in 2018, Berkshire releases the full archive of every Berkshire Hathaway annual meeting from 1994 forward. That’s 31 years’ worth of stuff, and you watch all of it — hundreds of hours, maybe even thousands of hours, 1,700 questions. What the hell? How do you start? Where do you begin with an archive that immense?

ALEX MORRIS (00:19:54): Yeah — slowly, and somewhat unwillingly at first.

BARRY RITHOLTZ (00:19:57): Did you just go back to ’94 and start plowing through? Was there a method to the madness?

ALEX MORRIS (00:20:04): Originally — well, first of all, when I was in college and got interested in investing, one of the books that really resonated with me was “The Essays of Warren Buffett,” which Lawrence Cunningham—

BARRY RITHOLTZ (00:20:14): I went to grad school with him.

ALEX MORRIS (00:20:15): He had the decades of shareholder letters, which you could just sit and plow through if you want, or he compiled it in a way where you could look at, what about capital returns to shareholders? — and look by topic.

BARRY RITHOLTZ (00:20:25): He had a much easier task, ’cause the letters are a couple of pages — 10, 20 pages each — and they’re already in print format. You had to fight your way through hundreds and hundreds of hours of video. How did you organize that material?

ALEX MORRIS (00:20:41): Well, originally it was only on CNBC’s website, with a web player where you couldn’t speed up the time. And one of those where, when you try to fast-forward 20 seconds, it goes 15 minutes and you can’t get back to your original spot. So that made it a little bit tough. When it eventually got on YouTube, that helped a ton. I originally went through it for the sake of learning and using it as writing material for TSOH. And as time went on — well, first I thought somebody else would do this, so I wouldn’t have to do it. And then I didn’t see anybody doing it. At one point, Harriman House reached out to me about writing a book, and I actually was working on something. Basically, the concept was for people like my parents or my grandparents, who had asked me questions about working with a financial advisor or managing their own finances. I was trying to write a book about how do you navigate that relationship with a financial advisor, and talking about active and passive and asset allocation. And then I started writing it, and as I got into it, I thought, well, one, I’m not hugely interested in this, and two, I don’t have the depth of knowledge on things like trusts or estates or a lot of financial planning stuff that’s a really important part of that discussion. I just don’t really have the depth of knowledge there — I shouldn’t be the person writing this. So when Harriman House reached out, I first said, you know, I have this book, but I think I’m gonna kind of drop it, and I don’t really have anything else. And then a week or two later, I wrote back to them and said, I think actually I might have something with the Berkshire meetings that I could explore a little more. But I can’t do it unless I reach out to Berkshire and get, if not approval, at least not disapproval from them.

BARRY RITHOLTZ (00:22:09): You don’t want them fighting you every step of the way.

ALEX MORRIS (00:22:10): Yes. So I put together a sample chapter and sent it to Warren’s assistant at the time, Debbie, and asked, can I please do this? I promised that I’m a massive fan of Warren and Charlie, and I’ll do a good job, and I’ll give away half the proceeds to Glide, which is a charity that Warren supported through the lunch auctions. So I got a response a couple days later saying, as long as you’re saying he didn’t approve this, you’re okay to go with it. So at that point I was like, okay, now I actually have to do this. And the process at first was not particularly well thought out. I remember I got through two or three or four meetings, and I realized I wasn’t getting to a place where I wasn’t gonna have to repeat that process again. So I went back to the start, created an Excel file where I timestamped everything, had like primary topic and secondary topic, and then a very simple green, yellow, red: is this gonna be in, or maybe be in? As time went on, I had a lot of overlapping things — I had to figure out which answer was better, which one should I keep. But as I got through 10 or 15 years, I knew what I was doing at that point.

BARRY RITHOLTZ (00:23:17): Did it reveal itself to you as you were working? By the way, full disclosure: Harriman House is my publisher. But one of the things I found fascinating about the writing process is when you happen onto a good framework, it sort of opens itself up to you. It reveals itself, and like, oh, I see what this should look like. I would imagine you might have had a similar experience — year after year, the same themes, the same ideas, although they must evolve over time somewhat.

ALEX MORRIS (00:23:51): Somewhat. And I got to a point where — well, one, yes, the meetings definitely have their place in time, as is kind of revealed — I mean, especially think of like the late nineties, or you get to the financial crisis, the discussions that are had there. The part of it that I found so useful, that I thought would resonate with people, was, you know, the letters are edited, and Warren’s very specific about what he says—

BARRY RITHOLTZ (00:24:12): Unscripted is very different.

ALEX MORRIS (00:24:13): Unscripted, when they’re off the cuff. And Charlie a lot of the time pushes Warren in directions that he may not want to go. The answers would be really revealing. And again, in a period like the late nineties, when people were really pressing them on, why aren’t you investing in tech companies — you know, as they’re pushing them, they get a little bit more honest and say things in a slightly different way than if they had written them. So anyways, as I worked through it, I just got to a point where I could imagine myself, the college kid, reading this book and getting a lot of value out of it. But I also could see myself, the person today who has a lot more experience, reading it and still getting value. So I thought, this is gonna be a worthwhile book for a wide range of people, so it hopefully could be a good project.

BARRY RITHOLTZ (00:24:53): So a recurring theme of all of the meetings, and therefore of the book: investing success is a temperament problem, not an IQ problem. Emotional stability, patience, and independence from crowd opinion do the compounding. Again, I don’t remember which of them I’m taking the quote from, but we’ve heard that over and over again. Give us a little color on temperament versus IQ.

ALEX MORRIS (00:25:24): Yeah. I mean, I think your book title sums it up well — “How Not to Invest.” What mistakes are you looking to avoid is a great place for starting to figure out where you’re trying to go. And I think that’s what they’ve done their entire career. And it’s funny how that mindset of “don’t be stupid” can still be connected to really big swings at points in time, ’cause that seems like an aggressive act and kind of a risky thing. But I think when you actually pair ’em together, they can work well.

BARRY RITHOLTZ (00:25:50): So the flip side of the Munger quote “be less stupid” is a Buffett quote: if you have an IQ of 160, well, you can sell 30 points — they’re not needed in investing. I love that. That goes and flies against everything we’ve ever heard about, you know, the genius hedge fund manager, the quants, the math whizzes. And clearly both Charlie and Warren — not dumb guys, right? They were more than less stupid. But how sincere is that — hey, you don’t need 160, and it’s probably gonna get in your way anyway?

ALEX MORRIS (00:26:28): I definitely think the latter part is true. It’s very easy to get overconfident in your abilities and to make mistakes that can be — particularly when you start doing things with options or leverage — you can make mistakes that are truly devastating. And if you just avoid those things, it’s much easier to, at a minimum, stay in the game. And to get to a decent place is also, I don’t think, overly difficult as a starting point.

BARRY RITHOLTZ (00:26:51): So over the three decades that the book covers, there have been wildly different environments, where there were those examples of people who should have been less stupid. So you had Long-Term Capital Management blow up in — what was that, ’98? — the dot-com implosion, the financial crisis, the zero interest rate policy of the 2010s, then COVID. How do the same principles that are espoused by Buffett and Munger apply to all these wildly different environments?

ALEX MORRIS (00:27:27): Yeah. I think it’s being consistently level-headed and not letting things get away from you, and having a long-term view, and staying within your circle — which I think is one of the biggest lessons I’ve had as an investor: learning what game you are playing and why you’re playing that game. And your answer may be different from mine. I think a funny example is, someone asked in one of the meetings about Peter Lynch, and Warren Buffett was talking about it and said, his approach works well for him and mine works well for me, and I think if he tried to adopt my approach, it would not work as well — and vice versa. There’s more than one way to get to heaven in this game. And as long as you understand that, I think you’re at least at a good starting point.

BARRY RITHOLTZ (00:28:04): Another quote that I can’t remember which of them said: volatility is the friend of the investor who knows values, and the enemy of the one who doesn’t. Explain that.

ALEX MORRIS (00:28:15): Yeah. Well, sometimes in real life it feels a little different than that, when you’re seeing a lot of volatility in your portfolio. But I think the idea is a sensible one, which is you don’t want your decisions to be led by the market. You want to be making decisions that are somewhat independent of what the market’s telling you. There’s a fine line there between just being stubborn and overconfident — I think especially when you’re younger. A quote like that — and this is true of a lot of quotes from Warren and Charlie — a little bit of experience helps you understand what they’re actually saying, versus maybe a more novice interpretation that can get you in trouble. So I think to completely disregard what the market’s saying is something that you should do cautiously, but the idea of acting based on what the facts tell you, as opposed to, you know, the short-term weighing machine, is the right mindset to have in investing.

BARRY RITHOLTZ (00:28:59): There are so many quotes of theirs that have just become so famous and repeated over and over again. What sort of buried gems did you find in there that people don’t really talk about? What stands out as, how is this not a more famous line?

ALEX MORRIS (00:29:15): I mean, I think some of the discussions on, again, things like stock option accounting in the late nineties, where — I think they say in the book, there were 500 companies, and two of them had adopted, quote-unquote, the right stock option accounting rules. Everybody else was playing this kind of game. And they talk about things like that so clearly, in a way that anybody can understand, that it’s just so useful to hear those things. I’m trying to think of other examples throughout the book that stand out. One example they give, in terms of their business, is National Indemnity Insurance Company. They talk about this idea of, there was a period of time where the volumes in that insurance business went up, I believe, five-x, then over a period of 15 years contracted 85%.

BARRY RITHOLTZ (00:30:00): Wow. That’s back below the original starting line.

ALEX MORRIS (00:30:03): Yeah. And you could imagine running a business and how painful that is. And they use it to teach a lesson — it applies differently in different businesses, but how in the insurance business, the only thing that matters is writing good business. And you have to get to a place where all the stakeholders, particularly employees, realize that writing bad business is not the decision to make. And you have to help them appreciate that they can keep their job, too, as you go through this. So it’s just an example of them laying out something that, when they explain it, is so sensible and logical. But you have to have that long-term mindset. And again, when you compare something like that to how a lot of public companies act, you start to notice things that you may want to avoid.

BARRY RITHOLTZ (00:30:41): That’s very much a Science of Hitting philosophy. You’re better off not writing bad business — not writing any business — than writing bad business. I think the modern Berkshire is underappreciated for the importance of the various insurers. So there’s GEICO, there’s Berkshire Re, there’s a few insurance companies, which essentially gave Warren a giant pool of capital — and patient capital — to work with. Talk about the significance of insurance to the success of Berkshire Hathaway.

ALEX MORRIS (00:31:17): Yeah, it’s been hugely important. That float has — I don’t know what the number is now, but it’s grown very significantly over a long period of time, and it has allowed them to make the investments that have, you know, gotten Berkshire to where it is today. One example that I come back to a lot, from one of those investments, is Coca-Cola. Everybody knows that Berkshire owns Coca-Cola. I think the part that people sometimes don’t know is that Warren started buying in, I believe it was ’88 or ’89, and he bought his last share in ’94. And he hasn’t bought or sold a single share since then. At a point in time, it was more than 30% of Berkshire’s equity portfolio — it’s not like it was 2% of their portfolio that they’re not touching. It was a hugely important position, and he hasn’t touched it for more than 30 years. Which is — you know, when someone’s really good at investing, like they are, and they do something like that, and you look around and see, well, nobody else is really acting in this way — it’s just something that stands out and I think is noteworthy.

BARRY RITHOLTZ (00:32:10): So I love the concept of, imagine you only get 20 investment decisions for a lifetime. When you look at Berkshire’s returns, it’s a handful of decisions and decades of sitting still that have been driving it. What is that thesis — hey, you’re only gonna make 20 meaningful investment decisions — what does that do to selectivity?

ALEX MORRIS (00:32:34): Yeah, it raises your bar a lot. The things that you’re willing to compromise on will — you know, if you need to find a hundred things to own, you gotta make a lot of compromises. If you can own 10 things, you can make less compromises. And if you can own one thing, you can get even more selective. So I think that idea of knowing what you’re looking for, being patient — and then these two are connected: if you’re gonna act in that way, you have to swing big, to some extent.

BARRY RITHOLTZ (00:32:57): So they repeat a lot of the same principles over and over over the years. I’m curious not only how things evolved, but what are some examples of them reaching a conclusion — hey, maybe we haven’t really thought this through, and we wanna pivot or tack away from a previous belief? Where did they really change their minds?

ALEX MORRIS (00:33:19): Yeah. Two really prominent examples. One, in an owned business, in GEICO: they basically missed the move in telematics, which is like the data measurement in the car, and Progressive was really early there. And Warren publicly, at the meetings, kind of said, we don’t think this is gonna be important to the rate-making decision. And they were wrong, and they were years behind.

BARRY RITHOLTZ (00:33:39): Explain what telematics does for an insurer.

ALEX MORRIS (00:33:41): Yeah. Basically, it gives you actual data from how someone drives, which, it turns out, is very important for determining how they drive and setting their rate and the riskiness, et cetera. So GEICO — or the way Warren talked about it, they were convinced—

BARRY RITHOLTZ (00:33:54): Is that built into the car, or is it something that you have to give permission for?

ALEX MORRIS (00:34:01): You have to get it — you had to get a device at one point. I believe you can do it with your phone now.

BARRY RITHOLTZ (00:34:07): And you get a discount if you use it?

ALEX MORRIS (00:34:08): You can get a discount for using it. And they’ve changed over time what they’re willing to do with your rates, but early on, you could just get a discount from it — you wouldn’t get a rate increase. So yeah, Berkshire, or GEICO, kind of missed that early, and they’ve kind of been playing catch-up since then. And Progressive went from millions of policyholders less than GEICO to now being quite a bit larger than GEICO.

BARRY RITHOLTZ (00:34:29): This is a huge growth story and change for them over the years. Is the telematics strategy what drove them?

ALEX MORRIS (00:34:40): Yeah, it’s a huge part of it.

BARRY RITHOLTZ (00:34:41): And then the other issue that comes up is that Buffett has been notoriously tech-averse, and then becomes one of the biggest shareholders of Apple. How did he explain that? How did he wrap his head around that major pivot?

ALEX MORRIS (00:34:58): That’s the other example I was gonna say. You go through a period of, I believe it’s 2011, 2012, 2013 — some select quotes are, when they owned IBM, they basically said — the person asking the question specifically asked about Apple and Google, which in hindsight is kind of funny, ’cause those are the two companies that they’ve now invested in — they basically said, we’ll never have the confidence in those two companies that we have in IBM. Which was not a good investment. And then, I think at the next meeting, Charlie even more forcefully said, basically, Apple’s too hard for us — we’ll never own it. Fast-forward a few years, and I think at one point it was almost a $200 billion position, and it’s one of the greatest investments of all time. And I think it just speaks to a willingness to continue learning. And, you know, Warren specifically talked about, on CNBC when they bought it, how at the Nebraska Furniture Mart — which is a retailer that they own — people come in and buy a TV, and they’re looking at the number of pixels or the quality of the screen, they’re comparing the prices, et cetera. And then when it comes to an iPhone versus an Android, it doesn’t matter if an Android phone is 60% cheaper — some people were just absolutely gonna buy the iPhone no matter what. So he noticed that, in terms of that differentiation between a technology question versus a consumer brand kind of question. I think he also recognized clearly the value of the screen and the services strategy that Apple, in the mid-2010s, really got underway. And also, the valuation was attractive, and they had a capital returns policy. That’s one of the things that really jumps out in terms of his investment approach: how much he valued, particularly in publicly traded companies, the combination of the valuation and a very clear capital return strategy. You see that at Apple. You see that at PetroChina in the early 2000s. It’s a very prominent part of what he seemed to be looking for.

BARRY RITHOLTZ (00:36:45): So I see how their ideas have changed over time. I’m curious — the process of going through the whole book, and all of the various meetings and videos you ended up watching: anything change the way you invest personally? Any ideas you’re still wrestling with, trying to put into practice?

ALEX MORRIS (00:37:07): Yeah. I think this idea of — again, I think I mentioned this before — kind of traditional value investors, this idea of change being a bad thing and trying to avoid it. It’s borderline impossible in today’s world. I mean, if you could give me a list of five companies that haven’t meaningfully changed in the last 10 or 15 years, it’d kind of be tough to do. Every industry is changing, and you have to be — you just can’t avoid it. It doesn’t mean you have to run into it, but you have to be really thoughtful about how every business is changing. And you think of the prominent examples that they gave over time of, you know, the greatest businesses — newspapers and other things that are either greatly changed or gone. And retailers, as an example.

BARRY RITHOLTZ (00:37:48): Adapt or die.

ALEX MORRIS (00:37:48): Yes, adapt or die. And I think that’s a reality of being a business manager. It’s a reality of being an investor. And you have to be willing to, you know, lean into that.

BARRY RITHOLTZ (00:37:57): Huh. Really, really interesting. Coming up, we continue our conversation with Alex Morris, author of “Buffett and Munger Unscripted,” discussing Berkshire Hathaway after Warren Buffett. I’m Barry Ritholtz. You’re listening to Masters in Business on Bloomberg Radio.

BARRY RITHOLTZ (00:38:16): I’m Barry Ritholtz. You are listening to Masters in Business on Bloomberg Radio. Alex Morris is my extra special guest this week. He is the author of “Buffett and Munger Unscripted: Three Decades of Investment and Business Insights from the Berkshire Hathaway Annual Shareholder Meetings.” He is also the founder of TSOH Research. So let’s talk a little bit about their relationship before we get to the post-Buffett — and we’re already in the post-Munger — era. What did Munger contribute to Buffett’s thinking that Buffett probably wouldn’t have developed on his own? They really had kind of a unique partnership.

ALEX MORRIS (00:38:59): Yeah, they did. And Charlie will say he didn’t have as much of an impact as Warren says he did — so I guess you gotta pick which one you want to agree with or believe. You know, I think Warren’s strategy that he ran up until the point in time when they became friends with each other, and the decades after, was a cigar-butt strategy, a traditional value investing strategy. The main constraint it was gonna run into over time was size — and that’s the problem they have now, even as they’ve adjusted the strategy. And I think Charlie changed his mindset a little bit towards buying businesses that they’re gonna own, as opposed to things that are gonna be liquidated or sold, whatever it may be.

BARRY RITHOLTZ (00:39:34): When you say buying businesses — completely, like a full takeover? Not just, we don’t want 10% of GEICO, we want all of GEICO?

ALEX MORRIS (00:39:42): Yeah. I think one of the prominent early ones was See’s Candies, where they were getting a little touchy on the price, and I think they had someone who worked with them who said, if you guys don’t buy this ’cause the price is 10% higher than what you wanted, you’re idiots, basically.

BARRY RITHOLTZ (00:39:56): Really? Who says that to Warren Buffett? I’m curious.

ALEX MORRIS (00:39:58): I think it was Charlie Munger’s partner — I wanna say Ira Marshall, for some reason, but I could be incorrect. But anyways, they told him, if you don’t buy this business ’cause it’s 10% higher than what you want to pay, you’re not being very intelligent, because this is a really good brand and it’s gonna be a really good business over time. And thankfully, they listened.

BARRY RITHOLTZ (00:40:16): You know, I have a buddy, Jonathan Miller, who’s not only a data junkie with the back end of real estate, an appraiser, but he was saying, if you’re buying a house that you’re gonna live in for 25 years — this is the house — if you pay 10 or 15% over, who cares? Just look at houses sold 25 years ago: what would’ve happened if you paid 10% more for that? It’s meaningless. And Marc Andreessen said the same thing about Facebook. All right, it was a 40x or a 50x — imagine if we paid 25% over. It wouldn’t have made any difference. And yet this is coming from people with a value background. How do you reconcile that?

ALEX MORRIS (00:41:01): Yeah. Personally, my personal experience taught me, in some ways, to just get past that way of thinking. And again, as I said before, I bought Microsoft in 2011. It was a very traditional value investment — ex-cash, it was trading at a high-single-digit P/E. Again, a very traditional value investment. You get forward to 2015 or 2016, in that period, and now the P/E, as opposed to being in the high single digits, is, call it, mid-teens. And I can remember at that point in time, a lot of the, again, more traditional value investors, they were at a point where they’d go, okay, we’ve had our run here — it’s time to sell. It’s a situation where I looked and saw, with Satya Nadella, who was recently named the CEO at that time, the strategy they had in the cloud business — and not that I have any great technical knowledge on this, but the way they explained where they were going and what the opportunity was, it just seemed clear to me that to sell it simply because the P/E was a couple turns higher than, you know, what the quote-unquote fair price was — it just didn’t make a ton of sense. If you’ve found a business that has a really long runway, with a person running it that you think is the right person for that job, to let that go easily is a mistake. And it’s funny to look back now — I didn’t know this, ’cause I was updating on Microsoft the other day: over the last decade, the stock’s compounded at a mid-twenties annualized return.

BARRY RITHOLTZ (00:42:20): Amazing.

ALEX MORRIS (00:42:20): This happens all the time with companies like this, where people, if they become too focused on the valuation, they go, this isn’t gonna generate more than 12% a year over the next decade, or whatever.

BARRY RITHOLTZ (00:42:25): What’s the line? Price is what you pay, value is what you get.

ALEX MORRIS (00:42:30): Exactly.

BARRY RITHOLTZ (00:42:31): So clearly, even at an elevated price, Microsoft turned out to be a good value.

ALEX MORRIS (00:42:34): You have to consider both at all times. If you become overly focused on price as the driver of your decision-making, I think that’s kind of a flawed way to do things. And the same goes for — you know, theoretically, you have a portfolio, and theoretically you could re-rank it every single day on expected five-year returns, whatever it may be, and the answer’s gonna change based on what those positions did the day before. Obviously, I think that mindset, while it makes sense theoretically, guarantees you’re never gonna own anything particularly in size. You’re gonna be trimming it as it goes up 20, 30, 50%, because—

BARRY RITHOLTZ (00:43:07): Suddenly it’s fully valued.

ALEX MORRIS (00:43:08): The IRR is three points lower than it was six months ago. And I just think, if you look back — again, like the last 15, 20 years, and your example of Facebook — selling it because the IRR was down slightly was a mistake, if you understood what the business was, in some sense, and what the opportunity was. Again, you can deal with this through position sizing, but be really thoughtful about selling businesses that you actually think are worth owning.

BARRY RITHOLTZ (00:43:30): Yeah, that makes a lot of sense. Both Buffett and Munger have emphasized staying within one’s circle of competence. How can an investor expand that circle, and how do you avoid fooling yourself into thinking you have some competence when you don’t? This is classic Dunning-Kruger.

ALEX MORRIS (00:43:51): Yeah. I think it’s time; it’s a willingness to learn; it’s a willingness to feel around and not always, you know, have the answers right away. I mean, for example, at TSOH, a lot of my initiations on companies — they very rarely end with, you know, this is my price target, or this is a buy today. That’s very uncommon for me. The conclusion is almost always: here’s what I think is interesting about this company; these are the questions we kind of need to explore and get a better feel for over time. And it’s just that continual learning process, where sometimes you get, you know, three, four, five years down the road from there and you still don’t have the answers. Other times, you get a couple years down the road and things happen in a certain way, and you go, wait a second — I think I’m seeing this now in a way that I didn’t originally. And you find enough examples like that, and you can have a portfolio.

BARRY RITHOLTZ (00:44:34): Really, really interesting. What do you think, of all the principles that Buffett and Munger enumerated over the years, are often quoted but really infrequently practiced by professionals, or just difficult to put into effect by mom-and-pop investors?

ALEX MORRIS (00:44:54): Yeah. They’ve had things like, you know, permanent capital — which, you look at an example like Terry Smith at Fundsmith right now: when things go against you for a relatively short period of time, but your assets start going away, that’s a huge problem. So things like that are just a prominent example of how thoughtfully they’ve constructed everything, and what that then allows them in terms of their flexibility — of, you know, being really patient, or taking big swings, et cetera.

BARRY RITHOLTZ (00:45:19): What about “avoid difficult decisions”? Is that realistic today?

ALEX MORRIS (00:45:24): Again, I think it’s more difficult over time. But I think if you’re patient, you can — again, as you learn more and more, decisions that may appear difficult might be less so for you.

BARRY RITHOLTZ (00:45:34): I really like Buffett’s comment about market forecasts: they tell you nothing about the market, but a great deal about the forecaster. They claim to have never made a Berkshire decision based on a macro prediction. How true is that?

ALEX MORRIS (00:45:51): Well, I think you look at their cash position currently and wonder how much of that is, you know — maybe it’s not a macro forecast, but there has to be some belief about markets or prices generally. I guess you could look at it at a micro level and say, we can’t find anything — and collectively, all the micro is the macro, right? You know, I think the bigger point — and it’s something that we’ve all seen over the past 15 years — I mean, I’m sure you can remember well, 2011, 2012, people were like, okay, we’re back to another bubble; we got past the GFC, and now here we are again, and stocks aren’t gonna go anywhere for the next decade. And good call — people who overdosed on that have paid a very significant price.

BARRY RITHOLTZ (00:46:29): You know, it’s funny you bring that up. I remember — I don’t remember if it was late ’08 or early ’09, but Buffett wrote an op-ed, I think it was in the Times, “Buy American.” And that felt very much like a combination of, everything has gotten cheaper — so there’s a valuation issue — and, we weren’t quite down 56%, but we were on the way; maybe we were down a third by that time. But it felt like a macro call: hey, this is a temporary crisis and we’ll get past it. Or was it strictly a valuation decision?

ALEX MORRIS (00:47:04): Yeah, I think it was a little bit of both. I mean, as he said later on — you know, I wrote that in, I think he said, October of ’08, and to your point, people were like, wow, what a great call. It was like, well, it was down another 30% six months later, or whatever it was — so my timing wasn’t particularly great. You know, I think the bigger takeaway, particularly for individual investors, in my mind, is understanding something like a structural asset allocation and having clarity on what you’re trying to achieve. And again, coming back to this idea, over and over, of the mistakes you’re trying to avoid. We saw over the past 15 years people making big swings in and outta cash, in and out of the markets. I think you’re just making the game more difficult than it needs to be. And when you’re wrong, it really hurts.

BARRY RITHOLTZ (00:47:47): So, having studied every answer Buffett ever gave about succession over 31 years, what does the record tell us about how he set up his succession? And what did his Thanksgiving letter last year add?

ALEX MORRIS (00:48:04): It’s kind of funny — starting with the ’94 meeting, they were asked every single year about succession.

BARRY RITHOLTZ (00:48:11): He’s, what — he’s my age back then? He’s in his early sixties back then.

ALEX MORRIS (00:48:15): Yeah. It turns out he had another three decades to go. You know, I think they’ve said over time that there’s nobody who cares about the answer to this question more than we do. And you know, a lot of the businesses — at BNSF, the railroad, Warren’s not really involved in the decision-making there. Same at GEICO, same at a lot of other businesses. A lot of the equity positions, like I said — Coca-Cola or Amex, all these other ones — they’re just in there, and they’re almost certainly not going to be sold by Warren or anybody else. So I think a lot of the pieces are in place. The biggest challenges Berkshire has: as I mentioned, there were some operational issues at businesses like GEICO that had to be fixed, and the massive cash pile is another challenge. Those challenges existed two years ago with Warren, and, you know, they still exist today, and solutions are difficult. But it seems like Greg Abel is starting to move in the direction of trying to resolve those issues.

BARRY RITHOLTZ (00:49:09): So let’s talk a little bit about Greg Abel. He took over as CEO of Berkshire on January 1st of this year, 2026. You were at the meeting in Omaha, his first annual meeting — Buffett just sitting in the audience like any other Berkshire shareholder. Well, maybe not like any other Berkshire shareholder, but not on stage. What was that like? How was Abel? Are you confident that this was the right choice and Berkshire is in the right hands?

ALEX MORRIS (00:49:38): Yeah, I think that — and this is also informed by writing the book, the questions over time. In the early days, the questions were really focused on Berkshire and investing, and I think as time went on, they became a lot more about life advice and other things that, while still interesting, are not really Berkshire-specific. And when you got to things like, as I was saying, GEICO and telematics, or at BNSF, where their results were lagging some of the other Class I rails, I think Warren had a tendency to not wanna point fingers at the managers, and he wouldn’t really talk specifically about the issues there — which, you know, for the people who are kind of the diehard Berkshire shareholders, we want to hear those things. Greg took those questions head-on, which was really refreshing to hear. And I think everything we’ve seen so far would suggest that, you know, as Warren and Charlie said, we’ve thought about this more than anyone else — and I think that’s probably reflected in their decision.

BARRY RITHOLTZ (00:50:30): So you mentioned the huge cash pile — a couple hundred billion dollars just lying around. I know, that’s walking-around money. What does capital allocation look like under Greg Abel? Is he gonna emphasize buybacks, or going out elephant hunting and finding some big acquisition, or something else entirely?

ALEX MORRIS (00:50:50): I think repurchases will surely be a big part of the strategy.

BARRY RITHOLTZ (00:50:55): And by the way, Munger and Buffett have both been very explicit about buybacks: hey, when you’re below your true value, when you’re below fair value, it’s a deal — absolutely do buybacks. But if you’re fully or richly priced, it’s a disaster waiting to happen. They made no bones about it, and they acted on that. Where do you think Greg falls on that?

ALEX MORRIS (00:51:19): Yeah. I think Berkshire started buying shares more significantly — I think they started in 2019. The pace has slowed down lately.

BARRY RITHOLTZ (00:51:28): Implying they’re close to fully valued.

ALEX MORRIS (00:51:30): Yeah. I believe that they have views about the market, or the opportunity set more broadly — I think that would be fair to say, based on how they’ve been acting for some time now. You know, it would’ve been helpful if they’d started repurchasing shares earlier. I don’t think Warren was particularly interested in doing that for a good amount of time, and it got to a point where they basically had no choice: they either had to, or have to pay a large special dividend, whatever it may be. I think Greg will be a lot more open to leaning into these things. And as I said, many times — I mean, obviously we haven’t had huge shakeouts, outside of maybe a brief period during the pandemic, but if we get a period where equities really trade off meaningfully and they can put a decent amount of dollars to work, they’re willing to spend tens and tens of billions of dollars, or potentially even over a hundred billion dollars, if the right opportunity is there.

BARRY RITHOLTZ (00:52:16): What’s the cash holdings right now?

ALEX MORRIS (00:52:17): I think it’s north of 300.

BARRY RITHOLTZ (00:52:20): Yeah. It’s a crazy number. That sounds to me like a war chest waiting for a disaster to happen.

ALEX MORRIS (00:52:26): Yeah. I think the thing is, you gotta find a willing seller — which, if you’re gonna buy a whole business—

BARRY RITHOLTZ (00:52:30): Do you have to find a willing seller, or can you wait for an era of distress, where everybody’s a seller and you are the — well, you know. That’s what I meant by war chest waiting for disaster to strike.

ALEX MORRIS (00:52:44): Well, that’d be a nice way to deal with this issue. And we haven’t seen it yet, but I’m sure the day will come where things look really ugly, and I’m sure they’ll be ready to act — and will act.

BARRY RITHOLTZ (00:52:53): So the whole idea of the annual meeting taking place in Omaha was really built around these two men, Warren Buffett and Charlie Munger — one of whom is no longer with us, and the other one is now sitting in the audience. So the question that comes to mind is, does Omaha still matter today? What’s it gonna look like, you know, a decade from now?

ALEX MORRIS (00:53:17): Yeah. It’s funny — I think, and I’d say from my experience here, and from people I know who are also Berkshire shareholders, it sounds like their experience has been similar — it’s become an event where, you know, people go there, and there’s so many events around the meeting now that aren’t the meeting. It’s people coming together who are hosting their own meetings of one variety or another, or having investor conferences. And yeah, I think that’s become a really important part of this trip for a lot of people. So I sense — I mean, the size of the audience will get smaller, as it has already, I believe.

BARRY RITHOLTZ (00:53:47): Oh, is that true?

ALEX MORRIS (00:53:47): Yeah, I think it was smaller this year than it’s been in the past. But for the core group of, you know, the diehard value investors, I think they’ll continue to show up for a while, as long as those events keep going on.

BARRY RITHOLTZ (00:53:57): Do you have any insight into who the average Berkshire shareholder is? Is this primarily Main Street, or is this more professional investors, or some obvious combination?

ALEX MORRIS (00:54:09): Yeah, I think it’s a combo of the two. It feels like a combo of the two. They definitely attract a more Main Street audience than, I think, just investors do generally — or investment managers, especially.

BARRY RITHOLTZ (00:54:20): And I’ve never made it out to Omaha. I’m curious — who goes to these events?

ALEX MORRIS (00:54:25): Value weirdos.

BARRY RITHOLTZ (00:54:26): Really?

ALEX MORRIS (00:54:27): Yeah. People always like to joke that, you know, “I’m a contrarian” — and I’m sitting in here with 40,000 people who think the same way I do.

BARRY RITHOLTZ (00:54:35): It’s the scene from Monty Python’s Life of Brian.

ALEX MORRIS (00:54:38): Yes, exactly.

BARRY RITHOLTZ (00:54:39): You’re all individuals — you don’t have to follow the crowd. And they just repeat in unison, “We’re all individuals.”

ALEX MORRIS (00:54:46): No, I think it’s people who wanna learn. And for myself, it’s — you know, I’ve learned a ton from Warren and Charlie about business, but I’ve learned a lot more as well about life and other things that I think are, you know, as important as part of your development as an individual and as an investor. And it’s funny — I wrote Warren in 2010, and I said, hey, I’m not asking you for a job, and I have fantastic parents who are my role models, but outside of that, you’ve been really important to my life, and I just wanna say thank you for that. And he wrote a response, and it’s framed in my office. It’s probably the one material possession that I care about. But, you know, I think it’s people with that mindset, who have come to really appreciate all they’ve taught people. And obviously, Warren, through charity and other things, has done a lot for the world at large as well.

BARRY RITHOLTZ (00:55:33): Huh. Really, really interesting. So I only have you for so much time, and we don’t have the studio for so much time, so let’s jump to our favorite questions that I ask all of my guests — starting with, and I kind of have a suspicion as to the answer of this: who were your mentors who helped shape your career? I know you have the letter from Buffett, so I want you to address Buffett and Munger, as well as anybody else who might have shaped the curve of your career.

ALEX MORRIS (00:56:07): My start was with Peter Lynch, actually.

BARRY RITHOLTZ (00:56:09): Oh, really?

ALEX MORRIS (00:56:10): I think “One Up on Wall Street” was one of the first books I read, which, even to this day, when younger people ask me what should I read, I think that’s a perfect book for getting a feel for what investing is, and it’s very approachable. So I’ve always liked Peter Lynch. Other investors like Chuck Akre and some of these other fund managers — Ackman’s another example — fund managers, at least in the early 2010s, were names in the world that I tracked, and they were well known and people that I learned a lot from. Obviously, Warren and Charlie are at the top of that mountain for me.

BARRY RITHOLTZ (00:56:43): Let’s talk about books. What are some of your favorites, and what are you reading currently?

ALEX MORRIS (00:56:47): Currently reading the Jeremy Grantham book, which I thought is an interesting book. I’m reading a book about Fairfax. What else am I reading right now?

BARRY RITHOLTZ (00:56:55): About Fairfax?

ALEX MORRIS (00:56:56): Yeah, Fairfax — Canadian insurer. It’s called “The Fairfax Way.” It’s a good book. I have two young kids, so my reading time has been changed in for 4:00 AM walks with my daughter and podcasts. So I listen to a lot of podcasts now, as opposed to reading as many books as I’d like to.

BARRY RITHOLTZ (00:57:13): Well, that’s my next question. What are you streaming these days — either Netflix, Amazon, Disney, or podcasts? What’s keeping you busy?

ALEX MORRIS (00:57:20): I’ve been listening to your podcast. The Hagerty episode that you had here recently is really good — so interesting. I mean, your knowledge of cars was also — well, that helps the podcast.

BARRY RITHOLTZ (00:57:31): You know, I go outta my way to learn as much about each guest and their business as I can before the podcast, but that was easy. I didn’t have all that much research to do for that one.

ALEX MORRIS (00:57:43): You could tell you love that topic.

BARRY RITHOLTZ (00:57:45): It was fun. I’ve had a few really interesting automobile people over the years, but still — you have to do the deep dive, ’cause you’ll find stuff that you wouldn’t have without doing the research. I just think it makes a better conversation. What else? Give us some other podcasts.

ALEX MORRIS (00:58:04): My buddy Bill Brewster has his podcast, called The Business Brew. That’s a great podcast. And as part of my research, I listen to a ton of old interviews and things like that that I find — like, I’ll listen to Reed Hastings from 2005 and listen to him talking about Netflix and what their strategy is. I find those, along with old articles, so helpful in terms of getting your mind to, what were people seeing, and what were they thinking at this point in time, and how did that translate from then to now? As an investor, I think that’s like a fascinating way to learn about businesses and people.

BARRY RITHOLTZ (00:58:33): So, our final two questions. What sort of advice would you give to a recent college grad interested in a career in investing?

ALEX MORRIS (00:58:42): I mean, I think it’s become harder, with Twitter and some of these other tools, over time, in terms of getting your voice out there. But I recommend to people — writing is the greatest thing that I ever did in investing, because it helped me to, one, build my audience. But two, it helps you to learn how to think, which might sound weird to people. But when you put something on a piece of paper and you read it and you go, okay, well, there’s no defense for that part, or, this doesn’t even really make sense — what am I trying to say here? When you sit down and go through that process, I think there’s so much learning. And to the extent that you do it — and I find this as well — when you reach out to people who are established in the business and you say, hey, I did a one-pager on XYZ, I really worked my butt off on this, and I’m a college grad — almost everybody is willing to respond if you’re really showing the effort and you’re, you know, conscious of their time. So take advantage of that while you’re young and people are willing to talk to you.

BARRY RITHOLTZ (00:59:31): And our final question: what do you know about the world of investing today that might’ve been useful 15, 20 years ago, when you were really first starting up?

ALEX MORRIS (00:59:40): Yeah — I know that I don’t know everything. I know that I’ve learned a lot along the way. As I said before, there’s different ways to play the game, and I’ve kind of found the version of this game that I wanna play, and that I think I can do well at. And, you know, just continuing to try to get smarter every day.

BARRY RITHOLTZ (00:59:56): That sounds like you’re bringing it back to the circle of competence.

ALEX MORRIS (01:00:00): Yeah. A lot of things come back to what Warren and Charlie have said. They’re pretty smart. They had some good ideas on investing and business.

BARRY RITHOLTZ (01:00:06): Those guys are definitely onto something.

ALEX MORRIS (01:00:08): It was hard to get this to 500 pages.

BARRY RITHOLTZ (01:00:10): Oh, really? Yeah, because they just repeat.

ALEX MORRIS (01:00:12): Well, I went through 1,700 questions, and I was like, okay — I tried to keep 1,100 of them. I think we gotta cut this down a little more.

BARRY RITHOLTZ (01:00:18): What was the original length of this monster when it first —

ALEX MORRIS (01:00:21): Oh, it was a huge Word document. I think it was seven or 800 pages. But then I had to go through, okay, which of these comments on value investing do I really need to keep? So that was one of the harder processes of writing the book.

BARRY RITHOLTZ (01:00:35): I could imagine. Alex, thank you so much for coming in. I have really been enjoying it — I’m about halfway through, and this isn’t like a book you pick up and, you know, read three or four chapters. It’s just dense with knowledge and information, and you really have to chew on everything on the way through. And I’ve very much been enjoying it. We have been speaking with Alex Morris, author of “Buffett and Munger Unscripted.” If you enjoy this conversation, well, check out any of the 659 we’ve done over the past 12 years. You can find those at iTunes, Spotify, Bloomberg, YouTube — wherever you get your favorite podcasts. I would be remiss if I didn’t thank the crack team that helps us put these conversations together each week: Alexis Noriega is my video producer. Sean Russo is my researcher. Anna Luke is my producer. I’m Barry Ritholtz. You’ve been listening to Masters in Business on Bloomberg Radio.

~ END ~

~~~

 

 

 

The post Transcript: Alex Morris, “Buffett and Munger Unscripted appeared first on The Big Picture.

Jet-Fuel Price Shock Hits Airlines As Raymond James Cuts Estimate Across Coverage, Warns Of JetBlue Bankruptcy Risk

Zero Hedge -

Jet-Fuel Price Shock Hits Airlines As Raymond James Cuts Estimate Across Coverage, Warns Of JetBlue Bankruptcy Risk

As we've told readers, and as former Goldman commodities guru Jeff Currie explained last week, the energy crisis is not necessarily in Brent or WTI supplies, but in refined-product markets, given the diesel crack spread's jump above $100 a barrel last week. Early Monday, the spread was trading around $94.

The secondary effects of a global refined-products crisis are beginning to hit airline earnings, according to Raymond James analyst Savanthi Syth, who wrote in a note Monday morning that she is cutting estimates across her airline coverage universe as jet-fuel prices surge.

US Gulf Coast jet fuel prices have soared 39% quarter-to-date through Aug. 19, outpacing gains of 26% in Brent and 21% in WTI. The divergence reflects yet another rising cost for airlines already confronting higher labor costs, aircraft shortages, and operational disruptions.

"We are lowering estimates across our airline coverage universe primarily to reflect a higher jet fuel price forecast (2H26E/2027E/2028E increased by ~18%/14%/7%), partly offset at non-U.S. airlines by the somewhat weaker U.S. dollar against local currencies," Syth told clients.

She added, "We are also upgrading ALGT from Outperform to Strong Buy following the greater QTD pullback in shares (Exhibit 11) despite a constructive backdrop (ex-fuel), including Allegiant's idiosyncratic margin recovery levers, flexible capacity model, and now-enhanced scale following the Sun Country acquisition. Our ratings and revised target prices are summarized in Exhibit 1, while select KPIs and estimates are shown in Exhibits 8-10."

Syth's revised third- and fourth-quarter earnings estimates are now below Wall Street consensus for most major carriers. Her 2026 forecasts include a 51-cent loss for American Airlines, a $2.43 loss for JetBlue, and earnings of $5.75 for Delta, all below consensus.

So far, passenger demand remains robust despite higher fares this summer, but the latest data from the Transportation Security Administration shows early signs of weakening in late summer. 

TSA throughput data is down about 2.6% from a year earlier this quarter, compared with a 1.1% decline in scheduled seats.

JetBlue appears to be the weakest airline in her coverage. She maintained an Underperform rating, warning that a Chapter 11 restructuring may be the "more prudent" way to address the carrier's overleveraged balance sheet.

S&P 500 Airlines Index vs. Jet-Fuel Prices

The takeaway is that the refined-products crisis, which has pushed jet-fuel and diesel prices sky-high, will begin to weigh on airlines again just as demand weakens heading into the end of summer.

Tyler Durden Mon, 08/24/2026 - 12:00

What Will Burst It: Ed Dowd Warns AI Is The Biggest Bubble Of All Time

Zero Hedge -

What Will Burst It: Ed Dowd Warns AI Is The Biggest Bubble Of All Time

Via Greg Hunter’s USAWatchdog.com,

Wall Street money manager and financial analyst Ed Dowd of PhinanceTechnologies.com made a name for himself during the dot com bubble.  It was not because he was telling people to buy, it was because he was telling investors to get out before it all blew up.  Dowd saved people a lot of money by sidestepping a crash. 

Fast-forward to today, and Dowd sees the same bubble signs in AI (artificial intelligence) as he did just before the Dot-com bubble blew up. 

This time around, it’s far worse.  Dowd says: 

“Being a student of history gives you an idea of where you might go in the future. 

Currently, we have the greatest bubble of all time, and that is the AI bubble. 

It is in the process of becoming exposed, and people are beginning to issue warning signals.  Lloyd Blankfein, the former CEO of Goldman Sachs, has issued a warning . . . about the AI risk.  He’s worried people are too concentrated in this trade...

First of all, there is not even enough power to power these data centers. 

That’s going to halt the CapEx (Capital Expenditure) on its own accord. 

There is so much capital that has to be raised that will compete with government debt, there will be a crowding out effect. 

The costs to finance this are going to keep going higher and higher, and this will cause some bankruptcies . . . and then it all unwinds.”

How bad does Dowd think this will get? 

Dowd says, “It would not surprise me to see a 40% to 50% correction at some point..."

"  Calling when that is going to happen is very difficult.  I don’t suggest anyone short the market, but it seems like we are getting closer to the end game when people are openly calling this a bubble. 

People say the bubble does not pop until everybody believes.  That’s not true.  There were plenty of people during the 2000 Dot-com bubble who knew it was a bubble. 

They actually played it, and the game was ‘get out before everybody else gets out.’ 

So, people know it’s a bubble.  The question is what will burst it? 

That is the credit markets and private credit, which has been a big source of funding for AI that is under stress.  There is a default cycle coming, and general backdrop of the real economy is quite weak. 

The consumer is not doing well.  Walmart just reported, and it had the lowest same store sales in six years...

The general population is not doing well, the housing market is rolling over, and we have the economic problems with China we have talked about before.  

So, it’s all conspiring to be a nasty correction.”

On top of that, Dowd, author of the popular book “Cause Unknown” (about the deaths and disabilities caused by the CV19 shots), has another big never-seen-before drag on the economy.  Dowd reports “US Disabilities Hit an All-Time High of 37 Million in July:  Up 23% Since Feb 2021.”  That’s when the CV19 injections rolled out.  Dowd says:

“This is a trend change.  I can confidently say a large percentage of that increase is CV19 vaccine related. 

This has been well documented, and it’s coming out more and more.  

I am just a stats guy showing the phenomenon. 

The science is coming in proving this is most likely the cause of this.”

When will this negatively affect the economy?  Dowd says, “It’s already affecting the economy.  When excess deaths and excess disabilities starting showing up, what did life insurers do?  They repriced their products higher.  So, the cost of healthcare insurance is going up for everybody.  More disabled means the system needs to spread that around.  This means higher prices for everybody.  Life insurance premiums are going up.  Health insurance premiums are going up.  Disability insurance premiums are going up.  It also affects employers, and it’s harder to find people.  The government will have to pay for disability. . .. It’s an economic drain and productivity suck. . .. This is just a disaster.  There are seven million additional disabled since 2020. . .. and the trend is still going up.”

There is much more in the 45-minute interview.

Join Greg Hunter of USAWatchdog as he goes one-on-one with money manager and investment expert Ed Dowd as he explains why the AI bubble is destined to pop.  Add this to the negative outlook written about in his report called “US Economy Outlook 2026.”

Tyler Durden Mon, 08/24/2026 - 11:40

Houthis Attack Saudi Oil Tanker In Red Sea, As Bab el-Mandeb Transit Is Up Slightly

Zero Hedge -

Houthis Attack Saudi Oil Tanker In Red Sea, As Bab el-Mandeb Transit Is Up Slightly

Yemen's Houthis on Monday targeted the Saudi oil tanker Amzan in the Red Sea off Yanbu with a ballistic missile and drones, the Iran-aligned militant group announced.

Soon after initial reports emerged, Saudi Arabia confirmed the attack, with Saudi shipping company Bahri stating that its Amzan vessel was involved in a hostile incident in regional waters.

Yahya Saree, the military spokesman for the Houthi rebels in Yemen, described that the attacks were carried out using ballistic missiles and drones and were executed as part of the implementation of the 'siege for siege' operation targeting the Saudis.

The Houthis are also claiming fresh attacks on Saudi military convoys carrying military equipment to Yemeni government forces. This is after pledging to hit Saudi troop concentrations and weapons depots anywhere they are found in the region. Details are as follows:

In another development, the Yemeni Armed Forces, by the grace of Allah, successfully carried out two military operations of which the first targeted a Saudi military convoy, consisting of a large convoy loaded with military equipment, in the Al-Abr and Al-Wadi'ah areas using ballistic missiles and drones, resulting in the burning and destruction of more than ten trucks loaded with weapons that were coming from Saudi territory to target the Yemeni people.

The second operation targeted Saudi enemy forces in the Al-Kanais area with ballistic missiles and drones, which resulted in the death and injury of dozens, including commanders and officers, and the burning and destruction of several weapons depots.

Starting last week, the Houthis laid out three objectives they seek to impose on the Saudis:

  • The first was described as “siege for siege,” referring to Ansarallah’s declared naval restrictions against Saudi shipping.
  • The second involved “striking Saudi troop buildups wherever they are,” while the third centered on “protecting Yemen’s sovereignty and confronting any enemy incursions.”
  • Ansarallah stated that its naval measures had imposed a tight blockade on Saudi interests, asserting that “not a single ship can pass through.”

Already, Aramco facilities have been targeted at least four times over the past weeks, since the Saudi-Houthi conflict erupted again. Iran has of late been much more open in boasting that its Yemeni ally is doing damage on US allies in the region. 

For example, Islamic Revolutionary Guard Corps (IRGC) spokesman Brig. Gen. Hossein Mohebbi recently told the semiofficial Mehr News Agency this week that the kingdom cannot defeat the group. 

"How can Saudi Arabia, whose military capability is less than that of the Zionist regime, be able to cope with Ansar Allah and the Yemeni fighters? This is not possible," he said.

Like the Iranians, the Houthis have some natural leverage given the geography of oil transit chokepoints. Al Monitor also observed this month: "Traffic in the Bab al-Mandeb Strait, which connects the Red Sea to the Gulf of Aden, may be on the rebound despite the Houthi blockade... Around 50 ships typically crossed before the recent escalation. 

It noted further, "Saudi Arabia has been rerouting oil exports through the Red Sea in response to the disruptions in the Strait of Hormuz."

Tyler Durden Mon, 08/24/2026 - 11:20

Los Angeles City Council Entertains Call For Homeless Masturbation & Hookup Centers

Zero Hedge -

Los Angeles City Council Entertains Call For Homeless Masturbation & Hookup Centers

Authored by Monica Showalter via AmericanThinker.com,

What's this strange proclivity from the left to provide the dregs of society with the same accommodations as those who pay their bills?

This is what passed for governance at the Los Angeles City Council last week:

"I'd like to propose that Los Angeles consider a pilot program for free hygenic sexual relief clinics, primarily serving the homeless and unhoused. This means equality. It means private sexual relief through masturbation, or where appropriate and consensual, with a partner. All funded by tax dollars and managed with professional oversight. It's about allowing the homeless to have the same comforts and privacy as we have today."

No, that's not satire. That really happened, and based on what's known, the guy was not thrown out of the room for it. Judging by the man's social-services choice of words, he sounded as though he came from an NGO.

Do tell us what that 'professional oversight' would look like watching the perverts in action and who would get that particular job?

This, from a city that's $97 million in the hole, with massive amounts of free accommodations for the always growing homeless population -- from free teeth, to free food, to free showers, to free tents, to free sleeping bags, to free socks, to free mental health care, to free bus passes, to free drug paraphernalia, to in some cases, to free drugs. There's nothing that can't be showered down onto the homeless population, with the lone exception of rehab for actually ending the homelessness. 

So now the proposal is for free masturbation centers as if that would solve the problem of bums masturbating in front of schools. We already know what free drug paraphernalia did: It created more drug use, not less. Now the idea is to encourage bums to jack off at state expense and assume it won't spill over into the sane population and make matters worse.

I have no doubt that this disgusting scheme is going viral among the NGO-industrial complexes around the world. A week or two ago, a formeer British parliamentarian suggested the establishment of free government brothels to 'service' illegal migrants, who are being flooded into the U.K.'s small towns and villages, flooding them with rape-minded single males. Someone must have heard that in Los Angeles and decided that that was just the thing for the homeless of that city, too. Now they're all pushing for it, which obviously, means a new source of funding for NGOs along with a new government bureaucrat-hiring channel. I have no doubt this won't be the last we hear of this idea.

It's disgusting, suggesting that these groups are scraping bottom, trying to figure out how to squeeze out the last tax dollar from the city while inflicting yet another plague on society.

Helping the homeless is not a matter of accommodating their every need to allow them to be homeless with ease. It's a matter of getting them off drugs and forced into work so that they can't be homeless anymore that works. That is the last thing thse pervy idea-mongers pushing new homeless programs of the grossest sort would want for the homeless.

Tyler Durden Mon, 08/24/2026 - 11:00

Key Events This Week: Jackson Hole. Nvidia Earnings And Core PCE

Zero Hedge -

Key Events This Week: Jackson Hole. Nvidia Earnings And Core PCE

As we start a new weeks, the upward pressure on long-end bond yields from last week has shown initial signs of easing. Indeed, the 30yr Treasury yield is down -5bps overnight to 5.22%, whilst the 10yr yield is down by the same amount to 4.69%. That’s been supported by an announcement by the Treasury to CNBC that some/all of the cash in the Treasury General Account may be used to fund buybacks (bringin the US ever closer to Yield Curve Control and a new QE, much to Kevin Warsh's horror) and by a pullback in oil prices, with Brent crude oil finally reversing course after a run of 6 consecutive gains to trade at $93.10/bbl.

That pullback in Treasury yields this morning follows last week’s surprise announcement that the US Treasury will increase its buyback operations for longer-dated Treasuries. That briefly eased the pressure on yields when it was announced, with the 30yr yield down -9.2bps on Wednesday to 5.19%, after reaching a post-2007 high of 5.31% last Monday. But even with that intervention, yields then crept back up into the weekend, with the 30yr yield closing at 5.27% on Friday, less than 4bps beneath its closing peak earlier in the week. Moreover, investor concern about wider financial repression led to clear effects in other asset classes, with the dollar index down -0.87% last week, whilst gold rose +5.18%. And this morning, gold is up another +0.72% to a 3-month high of $4,636/oz. 

One reason why yields moved higher into the weekend was the ongoing rise in oil prices last week, which added to fears about inflation. Indeed, if we look at the oil futures curve, it’s clear that markets are starting to price in a longer closure of the Strait of Hormuz again. For instance, the 12-month Brent future hit a 2-month high of $79.16/bbl on Friday, which isn’t far off its peak in the Iran conflict of $83.58/bbl back in May. So those expectations of higher oil prices put upward pressure on yields as well, and the weekend newsflow hasn’t shown any sign of progress towards a US-Iran deal either. 

The conflict is set to stay in the headlines this week, as US Treasury Secretary Bessent has said that he’ll be holding a press conference today to outline what he described as “the greatest coordinated economic isolation in the history of the world”. That follows President Trump’s post last week that “ANY country that allows its financial institutions, businesses, airports, or government entities to provide any type of lifeline to Iran will itself face TREMENDOUS Economic Consequences.” Bessent also wrote an article in the FT overnight, in which he referred to an “economic D-Day”.

Elsewhere, tariffs were also back in the headlines over the weekend, after the trade talks between the US and Canada broke down. Canadian PM Mark Carney said they were “walking away from a bad deal”, and would now “match Washington’s new tariffs dollar for dollar”. So that means Canada will now face 50% tariffs on around $20bn worth of goods, and Carney said that their own retaliatory tariffs would take effect on September 8. Meanwhile on the US side, President Trump posted that “Canada wants the benefits of being a State, without being one!!! They have also charged our great farmers, for many years, massive amounts of Tariffs. No more!!!” There’s already been a market reaction this morning to the breakdown of the talks, with the Canadian dollar weakening against every other G10 currency, including a -0.26% fall against the US Dollar. Otherwise, Bloomberg also reported overnight that Canada saw little chance of the talks resuming before the midterm elections. 

So with all that in mind, as we look forward, the week ahead has several other events, with a big one set to be Fed Chair Warsh’s speech at Jackson Hole on Friday. This is a speech that’s often used by Fed Chairs to make big announcements or send policy signals, and last year saw former Chair Powell acknowledge that policy might need adjusting, shortly before they cut rates again the following month. We’ll have to see what Warsh discusses this time, but he said at the July press conference that he hadn’t yet decided “whether it’s going to be a big-picture speech or whether it’s going to be a more traditional set up for all the action we’re going to have between September and December”.

We did a preview of the event (link here), where we note that the prevailing view is that if Warsh goes for the “big-picture” speech, then his options include a discussion of the Fed’s taskforces he set up, or possibly a speech on AI’s impact on the economy and his thinking. Alternatively, if he goes for the “more traditional” speech, they think Warsh could do a “cleanup” of the July press conference, and he may wish to counter one market narrative that Fed policy actions could be delayed until the task forces have completed their work. Otherwise, he might also discuss how officials are viewing inflation dynamics, or how the FOMC views the monetary policy implications of evolving financial conditions and recent volatility in long-term interest rates. But whatever he decides, market pricing is still very much in the balance for the next meeting in 3 weeks’ time, with futures currently pricing in a 39% chance of a hike. So investors are keeping an eye out for anything that could shift this in either direction.

Elsewhere this week, earnings season is winding down, but we do have a few releases left including the perhaps the most improtant of all - Nvidia - on Wednesday. In the last few years, Nvidia’s earnings have often been a big macro event in their own right, with reactions on a par with US jobs reports and CPI prints. But in the most recent quarters, the positive earnings surprises haven’t been as big as we saw in 2023-24, and after each of the last 4 earnings reports, Nvidia’s share price actually fell the next day. Speaking of Nvidia, Bloomberg also reported over the weekend that some of their biggest customers had been told about price hikes for servers containing its AI chips. So that adds to the signs that AI is having inflationary consequences, and isn’t a straightforward positive supply shock. 

Source: EarningsWhispers

Otherwise, the data calendar is fairly light next week, with a few inflation reports likely to be the main focus. That includes the US PCE reading for July on Wednesday, which is the Fed’s target measure, for which our US economists expect core PCE at a monthly 0.18%. Then in Europe, we’ll start to get some of the flash CPI prints for August, including from France and Spain on Friday, ahead of the Euro Area-wide number next week. 

Courtesy of DB, here is a day-by-day calendar of key global events this week

Monday August 24

  • Data: US July Chicago Fed national activity index

Tuesday August 25

  • Data: US August Conference Board consumer confidence index, Philadelphia Fed non-manufacturing activity, Richmond Fed manufacturing index, business conditions, July new home sales, June FHFA house price index, Germany August Ifo survey, France August consumer confidence
  • Central Banks: Fed’s Barkin speaks
  • Earnings: Intuit
  • Auctions: US 2-yr Notes ($69bn)

Wednesday August 26

  • Data: US July PCE, personal income, personal spending, durable goods orders, Japan July PPI services, Australia July CPI
  • Central banks: ECB's Cipollone and Fed’s Barkin speak
  • Earnings: NVIDIA, Crowdstrike, Salesforce
  • Auctions: US 2-yr FRN (reopening, $28bn), 5-yr Notes ($70bn)

Thursday August 27

  • Data: US July advance goods trade balance, wholesale inventories, August Kansas City Fed manufacturing activity, initial jobless claims, Germany September GfK consumer confidence, France July PPI, Eurozone July M3, Canada Q2 current account balance, China July industrial profits, Norway Q2 GDP
  • Central banks: Jackson Hole symposium (through August 29), BoJ’s Himino speaks, ECB’s account of the July meeting
  • Earnings: Marvell, Toronto-Dominion Bank, Autodesk, Workday, Dollar Tree, Pernod Ricard
  • Auctions: US 7-yr Notes ($44bn)

Friday August 28

  • Data: US August MNI Chicago PMI, Kansas City Fed services activity, Japan August Tokyo CPI, July jobless rate, job-to-applicant ratio, Germany July import price index, August unemployment claims rate, France August CPI, July consumer spending, Q2 total payrolls, Italy June industrial sales, August consumer confidence index, economic sentiment, manufacturing confidence, Eurozone August economic confidence, Canada Q2 GDP, Sweden Q2 GDP
  • Central banks: Fed Chair Warsh speaks at Jackson Hole symposium, ECB’s Schnabel speaks

Looking at just the US, the key economic data releases this week are the Durables report and the core PCE inflation report on Wednesday. There are a few speaking engagements by Fed officials scheduled this week, including events with President Barkin and remarks from Chairman Warsh at the 2026 Jackson Hole Economic Policy Symposium. Several other FOMC officials are likely to speak in currently unscheduled television interviews on the sidelines of the symposium.

Monday, August 24 

  • There are no major economic data releases scheduled. 

Tuesday, August 25 

  • 08:00 AM Richmond Fed President Barkin (FOMC non-voter) speaks: Richmond Fed President Tom Barkin will speak at a Chamber of Commerce event. Speech text and Q&A are expected. On August 13, Barkin said, "There’s an argument to be made that the inflation we see today is already headed to the right path... And the current level of interest rates, many think, is still restrictive enough to bring inflation down." But he added, "There’s a counterargument, however, that says the elevated inflation we see today is more embedded... [and] If true, this argument suggests help is needed to bring inflation all the way back down to target."
  • 09:00 AM S&P Case-Shiller home price index, June (GS +0.2%, consensus +0.1%, last +0.15%)
  • 10:00 AM New home sales, July (GS -2.3%, consensus -1.3%, last +1.6%) 
  • 10:00 AM Conference Board consumer confidence, August (GS 91.0, consensus 90.2, last 90.8)
  • 04:00 PM Richmond Fed President Barkin (FOMC non-voter) speaks: Richmond Fed President Tom Barkin will speak to the Charlotte Regional Business Alliance. Speech text and Q&A are expected. 

Wednesday, August 26 

  • 08:30 AM Personal income, July (GS +0.3%, consensus +0.2%, last +0.2%); Personal spending, July (GS +0.1%, consensus +0.1%, last +0.3%); Core PCE price index, July (GS +0.20%, consensus +0.2%, last +0.1%); Core PCE price index (YoY), July (GS +3.24%, consensus +3.3%, last +3.3%); PCE price index, July (GS +0.12%, consensus +0.1%, last -0.1%); PCE price index (YoY), July (GS +3.61%, consensus +3.6%, last +3.7%): We estimate that personal income and spending increased by 0.3% and 0.1%, respectively, in July. We estimate that the core PCE price index rose 0.20% in July, corresponding to a year-over-year rate of +3.24%. Additionally, we expect that the headline PCE price index increased 0.12% and increased 3.61% from a year earlier.
  • 08:30 AM GDP, Q2 second release (GS +1.6%, consensus +1.5%, last +1.5%); Personal consumption, Q2 second release (GS +3.4%, consensus +3.2%, last +3.2%)
  • Core PCE inflation, Q2 second release (GS +3.42%, consensus +3.4%, last +3.4%); We estimate a 0.1pp upward revision to Q2 GDP growth to +1.6% (quarter-over-quarter annualized). Our forecast reflects an upward revision to consumer spending growth (+0.2pp to +3.4%) but a downward revision to business fixed investment growth based on stronger personal care and healthcare spending but softer software spending details in the quarterly services survey (QSS). 
  • 08:30 AM Durable goods orders, July preliminary (GS +1.0%, consensus +0.5%, last +0.5%); Durable goods orders ex-transportation, July preliminary (GS +0.6%, consensus +0.5%, last +0.7%); Core capital goods orders, July preliminary (GS +0.6%, consensus +0.7%, last +1.2%); Core capital goods shipments, July preliminary (GS +1.0%, consensus +0.8%, last +2.0%): We estimate that durable goods orders increased 1.0% in the preliminary July report (month-over-month, seasonally adjusted) based on our tracking of commercial aircraft orders. We forecast a 0.6% increase in core capital goods orders—reflecting strength in the new orders components of manufacturing surveys in July—and a 1.0% increase in core capital goods shipments—reflecting the continued increase in core capital goods orders in recent months.
  • 11:45 AM Richmond Fed President Barkin (FOMC non-voter) speaks: Richmond Fed President Tom Barkin will participate in a panel discussion at a Greensboro Chamber event.

Thursday, August 27 

  • 08:30 AM Advanced goods trade balance, July (GS -$103.0bn, consensus -$100.2bn, last -$101.4bn); We forecast that the goods trade deficit weighed slightly in July, reflecting a continued decline in oil exports.
  • 08:30 AM Initial jobless claims, week ended August 22 (GS 210k, consensus 208k, last 206k); Continuing jobless claims, week ended August 15 (consensus 1,800k, last 1,799k)
  • 08:00 PM Jackson Hole agenda and paper titles likely released: The Jackson Hole program is expected to be posted to the event’s website, with the paper titles or panel topics and speaker names. Full text of the papers and speeches will be posted to the website at the time each event is scheduled to begin. This year’s topic is "Financial Innovation: Implications for Payments and Policy."

 
Friday, August 28 

  • 10:00 AM BLS releases preliminary annual payrolls benchmark revision: The Bureau of Labor Statistics (BLS) will publish a preliminary estimate of the benchmark revision to the level of nonfarm payrolls for March 2026. The final benchmark revision will be issued and incorporated into nonfarm payrolls alongside the January 2027 employment report in February 2027. Based on the Quarterly Census of Employment and Wages (QCEW)—the key source data for the annual benchmark revision—an upward revision seems likely; we estimate on the order of 50-450k (or a 5-40k upward revision to monthly payroll growth over April 2025-March 2026). We believe that difficulties accounting for unauthorized immigrants caused the QCEW to understate job growth and likely contributed to the deeply negative benchmark revisions of the last three years. Undercounting of unauthorized workers in the benchmark should be less of an issue for this year’s benchmark and going forward, reflecting the sharp slowdown in immigration.
  • 10:00 AM University of Michigan consumer sentiment, August final (GS 51.0, consensus 51.0, last 51.0): University of Michigan 5-10-year inflation expectations, August final (GS 3.3%, last 3.3%)
  • 10:00 AM Fed Chairman Warsh speaks: Fed Chairman Kevin Warsh will deliver keynote remarks at the 2026 Jackson Hole Economic Policy Symposium. Speech text is expected. 

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Tyler Durden Mon, 08/24/2026 - 10:45

Saylor's Strategy Launches 'USD Cash' Pool After $2 Billion Raise, No BTC Buys

Zero Hedge -

Saylor's Strategy Launches 'USD Cash' Pool After $2 Billion Raise, No BTC Buys

Michael Saylor’s Strategy, the world’s largest public company holding Bitcoin, raised about $2 billion through common stock sales last week while making no new Bitcoin purchases.

The Bitcoin treasury company sold 18.26 million MSTR shares between Aug. 17 and Aug. 23 through its at-the-market (ATM) offering program, according to a Monday filing with the SEC, adding a new pool of cash to its balance-sheet toolkit as part of an effort to preserve flexibility.

Strategy repurchased about 1.43 million of its STRC preferred shares for $136.4 million, added $300 million to its US dollar reserve and directed the remaining proceeds to a newly launched US dollar cash account.

“The new USD Cash pool gives Strategy more time and optionality, but it does not remove those underlying obligations,” said Nicolai Sondergaard, a senior research analyst at Nansen.

The newly established USD Cash pool, which currently holds $1.59 billion, will sit alongside its existing reserve (which stands at $5.1 billion reserves) bringing total cash to $6.69 billion...

Strategy said the new cash account gives management more flexibility to respond to market conditions and can fund purposes including Bitcoin purchases, preferred-stock dividends, debt payments and securities repurchases.

As CoinTelegraph reports, the company made no Bitcoin purchases or sales during the week, leaving its holdings at 840,447 BTC, acquired for $63.36 billion at an average price of $75,385 per Bitcoin.

Strategy hasn’t bought Bitcoin since the seven days ended June 22.

“For MSTR shareholders, the trade-off is dilution in exchange for flexibility,” Sondergaard concluded.

“The latest equity issuance strengthened the balance sheet, but did not immediately increase Bitcoin-per-share exposure.”

Strategy’s shares and debt securities rallied last week as Bitcoin ran toward $80,000, but the financing flywheel remains impaired, with its valuation premium still well below earlier-cycle levels.

Tyler Durden Mon, 08/24/2026 - 10:30

Newsom Signs 'Stop Nick Shirley Act' To Stop Investigations Into Immigration 'Service' Provider Fraud

Zero Hedge -

Newsom Signs 'Stop Nick Shirley Act' To Stop Investigations Into Immigration 'Service' Provider Fraud

Authored by AG News Staff via American Greatness,

California Gov. Gavin Newsom signed legislation Saturday expanding privacy protections for immigration service workers, despite warnings that the measure could chill investigative journalism and face First Amendment challenges.

Assembly Bill 2624, dubbed the "Stop Nick Shirley Act" by Republican Assemblyman Carl DeMaio, expands California's Safe at Home program to certain nonprofit employees who assist people navigating the U.S. immigration system.

The law will take effect Oct. 1, 2027, after Newsom leaves office because of term limits.

Democratic Assemblywoman Mia Bonta, who introduced the bill in February, said the protections are necessary because immigration service providers face harassment and threats.

"Our immigrant service providers are living in fear because of extremists looking to demonize the work that they do and the populations they serve," Bonta said Saturday.

The measure imposes penalties on people who distribute information or images of covered immigration workers under circumstances the law defines as inciting violence or threats. Posting personal information or an image with the specific intent that another person imminently use it to commit a crime involving violence or a threat of violence: punishable by a fine of up to $10,000 per violation, imprisonment of up to one year in county jail or under Penal Code § 1170(h) (16 months, 2 years, or 3 years), or both.

Critics argue the language could discourage journalists from investigating nonprofit workers suspected of fraud or misconduct. Bonta disputes that interpretation, maintaining the law targets doxxing and threats rather than legitimate reporting.

DeMaio accused lawmakers of attempting to intimidate people "trying to shine light on bad behavior."

The legislation became associated with independent journalist and YouTuber Nick Shirley after his investigations into alleged fraud involving immigrant communities and nonprofit organizations. Shirley has argued the measure emerged in response to his reporting in Minnesota and California.

The controversy intensified Wednesday when Shirley was conducting an interview outside the state Capitol in Sacramento.

Terry Schanz, chief of staff to Democratic Assemblywoman Tina McKinnor, interrupted the encounter while holding a sign making a crude allegation about Shirley's anatomy.

The incident created an uncomfortable contrast with Democratic arguments that the new law is needed to combat harassment. Multiple complaints have since been filed against Schanz with the Legislature's human resources department, according to the New York Post.

California's existing Safe at Home program provides substitute mailing addresses to certain people considered vulnerable to threats, including domestic violence survivors and some health care workers.

With AB 2624, California will extend similar protections to qualifying immigration service workers, setting up a likely debate over where personal safety protections end and constitutionally protected newsgathering begins.

Tyler Durden Mon, 08/24/2026 - 10:15

10 Monday AM Reads

The Big Picture -

My back-to-work morning train WFH reads:

• Broadening the Base: more than 60% of stocks beat the S&P 500 in June and July: A natural outcome of rising market breadth has been the rise in dispersion, which measures how differently stocks are performing relative to each other. S&P 500 dispersion has reached historically high levels, and Exhibit 4 shows that S&P 500 Equal Weight Index dispersion has tracked closely with its cap-weighted peer. This is not surprising given the increased scrutiny faced by companies across the size spectrum, which is typical during an earnings season. Anu Ganti on the rally spreading out beyond the mega-cap hyperscalers. More than 60% of stocks beat the S&P 500 in June and July, equal-weight tech is ahead of its cap-weighted counterpart by 19% year to date, and roughly 85% of reporting companies have beaten estimates. (S&P Dow Jones Indices)

• King Carney Activates Kong Mode With Zero F*s: At two minutes to midnight on Friday, Mark Carney did what no Canadian prime minister has done in living memory — looked at the most powerful man in the world, checked his watch, and told his negotiators to come home. Not paused. Suspended. (I F*ing Love Australia) see also  Great, Scott…: Michael Green discloses that he sent Treasury Secretary Scott Bessent a proposal earlier this year — a Sovereign Debt Optimization Facility swapping deep-discount vintage long bonds for current-coupon par bonds. What Treasury announced last week was a cash buyback program, materially different in both mechanics and optics. (Michael Green)

• From Thomas Paine to Dell Webb: 250 Years of Retirement Angst: It’s the question that keeps millions of Americans up at night: Do I have enough saved for retirement? A long view of an anxiety that predates the 401(k). Almost half of American families have no retirement plan at all, per the Federal Reserve, and those leaning on Social Security face a 22% benefit cut if Congress lets the trust fund run dry in 2032. (Barron’s)

• We Went to Wall Street’s Exclusive Wilderness Camp. Everyone Was Spooked by AI. Between fishing outings and poker games, veteran finance pros shared fears about the artificial-intelligence trade. Money managers and economists made their annual pilgrimage to Grand Lake Stream, Maine, traded suits for cargo pants, and then spent the week asking the one question that actually matters now. (Wall Street Journal)

• Corner the Market, Get Cornered: The Class Action Against Compass: “Today, Compass is a living, breathing real estate leviathan.” Jonathan Miller on Castaneda/Gelfand v. Compass, just filed in federal court, alleging the post-Anywhere firm is an illegal monopoly and pointing to forced StreetEasy delistings. The complaint calls Compass a Leviathan; Miller expects more suits to follow, likely on the sales side next. (Housing Notes)

• Sports Bettingʼs Rise and the Line Between Entertainment and Problem Gambling: Bettors are overoptimistic: in our study, they expect to break even but actually lose 7.5 cents per dollar wagered, with losses on parlays especially underestimated. Overoptimism is largest among bettors who partake in a complex type of bet known as a parlay. Compared to other forms of betting, parlays are more likely to be driven by bias. (Initiative for Financial Decision-Making)

• How big is America’s “obesity penalty”? GLP-1s offer a rare insight into the social and economic effects of carrying extra weight. GLP-1s have created a rare natural experiment. Doctors promise better mobility and cleaner metabolic numbers, but the interesting data is in what happens to the social and economic returns to losing weight. (The Economist free)

• How Satellite Advances Are Changing the Game for Ukraine: Michael Schwirtz on the new tool in Ukrainian drone teams’ hands — near real-time information on Russian troop movements and locations. Ukrainian drone teams have a powerful new tool: near real-time information on troop movements and locations. (New York Times)

• More People Call in Sick on August 24 Than Any Other Day: The second ‘sickest’ day of the year falls after Super Bowl Sunday in February. (Bloomberg)

• The Improbable Longevity of “It’s Always Sunny in Philadelphia” The irreverent comedy is the longest-running sitcom in history, yet has won no major awards. What gives? (New Yorker)

Video of the day: China’s BYD Is Taking Over the World’s Shipping Lanes — And Nobody Knows

Be sure to check out our Masters in Business this past weekend with Alex Morris of TSOH Investment Research. He is the author of “Buffett and Munger Unscripted: Three Decades of Investment and Business Insights from the Berkshire Hathaway Annual Shareholder Meetings.” The book was named one of Amazon’s “Best Books of 2025.” To write it, he reviewed every Berkshire annual meeting from 1994 through 2024 — 100s of hours of video covering more than 1,700 shareholder questions over 31 years — after Berkshire released the meeting archives.

 

How big is America’s “obesity penalty”?

Source: Economist

 

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The post 10 Monday AM Reads appeared first on The Big Picture.

MAGA, The DSA, & The Politics Of No Competition

Zero Hedge -

MAGA, The DSA, & The Politics Of No Competition

Authored by Katherine Gehl via RealClearPolitics,

Despite the narrow loss by Democratic Socialist Francesca Hong in the Wisconsin Democratic gubernatorial primary last week, DSA candidates have prevailed in primaries this year from Maine to California. The Democratic Party establishment believed it dodged a bullet in Wisconsin, but this threat is not going away any time soon.

The roots of the radical left's success were seeded almost a decade ago. In 2017, a writer in a Democratic Socialists of America publication laid out a strategy under a plain title: "Want to Elect Socialists? Run Them in Democratic Primaries." The Democratic Party, the article conceded, was deeply flawed - but it was the easiest available path for socialists to win elections and build power. Nearly a decade later, that strategy is bearing fruit. Democratic Socialist and allied candidates are winning Democratic primaries, and with them, safe Democratic seats - maybe even some competitive seats.

We have seen this before, on the right side of the political spectrum. Donald Trump - who sought the Reform Party's presidential nomination in 2000 and registered as an independent in 2011 - ultimately abandoned the outsider path. His nationalist-populist movement could not realistically win elections as a third party - under our rules it would only split conservative votes and hand elections to Democrats. So Trump and his MAGA movement didn't build. They captured. Trump fought inside the Republican Party, where a committed faction could dominate low-turnout primaries, threaten incumbents, and seize the party's brand. Today MAGA owns that brand, the infrastructure, the finances, and the power of the GOP.

These two stories are usually told as ideological earthquakes - the radicalization of the right, the leftward lurch of the left. They are better understood as the same structural event, produced by the same underlying cause. The cause is the century-long determination of America's two dominant political parties to retain their power at all costs.

To retain their stranglehold on the levers of power they employ a dozen different strategies, ranging from restricting ballot access to manipulating political primaries. But the single rule allowing Democrats and Republicans to keep control is one most of us never even notice - and one that sounds perfectly reasonable: In most U.S. elections, the winner is the candidate with the most votes. The technical term is plurality winners.

This seems simple and fair on its face, but it turns out to be wildly consequential - and not in a good way. You see, if the winner is only required to have "the most votes," that means in any race with more than two candidates, a candidate can win with less than a majority. For example, a candidate can win with 34% in a three-way race, meaning two-thirds of voters preferred someone else. In a five-way race, the winner could emerge with 21%. This dynamic creates the "spoiler" or the "wasted vote."

In plurality winner elections, we often don't feel free to vote for the candidate we like best, out of fear our vote will inadvertently help elect the candidate we like least. For example, in the 2016 presidential race, if you liked Green Party candidate Jill Stein, you knew you probably shouldn't vote for her because that would take votes from Hillary Clinton and help elect Donald Trump. The mirror on the right: You may have wanted to vote for Libertarian Gary Johnson, but you knew that would take votes from Trump and help elect Clinton.

Plurality winners aren't just a problem for "fringe" views. They're the reason so many voters experience November general elections as a choice between the "lesser of two evils."

Consider 2024. Numerous polls found that most Americans didn't want a rematch between Donald Trump and Joe Biden - roughly two-thirds said they were tired of the same candidates and wanted someone new. Clear majorities of Americans said neither man should run at all.

Into that vacuum stepped the group No Labels, whose founder and chief executive, Nancy Jacobson, reached out to some 30 potential candidates for a centrist "unity" ticket. The names were serious people - Joe Manchin, Larry Hogan, Kyrsten Sinema, Liz Cheney, Chris Christie, and Nikki Haley among them. Not one would run.

Manchin said the quiet part out loud - he ruled it out publicly stating he refused to be a spoiler. There is the whole trap, in a single word. Under plurality winners, a credible independent - or third-party candidate - doesn't enter the race as an equal competitor; he enters as a spoiler. The spoiler problem means no votes, no votes means no chance, no chance means no money, no money means no messaging, no messaging means no chance, and no chance means no votes. It is a vicious cycle, and it shuts out new competition before a single ballot is cast. No Labels went looking, in its own words, "for a hero," and a hero never emerged. The system disqualified them before the starting line.

So why do we do it this way? Because in the early days of our Republic, we made a mistake.

At the time, democratic elections barely existed anywhere on earth, so Americans copied the one working model, Great Britain's. For centuries, the freeholders of each English county gathered at the county court - a public assembly summoned by the sheriff - to choose the "knights of the shire" who would sit for them in the House of Commons, and the town boroughs did the same. The rule was identical and unquestioned: The most votes won, majority or not. There was no mathematical science of voting yet, no menu of alternatives to weigh. So, we reached for the only template in existence and carried it across the Atlantic. We didn't carefully design our rule for who wins. We backed into it.

Today, the plurality winner system is the greatest barrier to entry in American politics. Consider this: In any other industry as large and thriving as the politics industry, with 86% customer dissatisfaction (the public disapproval of Congress per Gallup's most recent data), some entrepreneur would see a phenomenal business opportunity and enter the market to give the customers what they want. One would think that a marketplace of ideas so vastly underserved would produce third - or fourth, fifth, and sixth - alternatives. But American politics doesn't work this way. The cause: plurality elections.

Political scientists call this phenomenon Duverger's law, the tendency of plurality winners to produce exactly two parties. No new major party has emerged in American politics since the Republicans in 1854.

Economists also have a name for this kind of system: a non-clearing marketplace. In a healthy market, competition keeps working until supply rises to meet demand and the market "clears." Our political market never clears. Economists know why a market gets stuck like this: It's rarely nature; it's almost always an artificial barrier. Housing is the textbook case - demand for homes in a thriving city dwarfs supply, yet zoning, permitting, and other government requirements choke off new construction.

Plurality winners are the corollary in American politics: the rule that keeps new supply from ever reaching the voters clamoring for it. The demand for a real alternative is enormous and unmistakable. Poll after poll finds a majority of Americans want a third choice. When a market is barred from clearing, the built-up pressure doesn't vanish - it escapes into the black market. That is precisely what the hostile takeovers are: the black market of a rigged political economy, demand forcing its way in where honest competition is blocked.

End plurality winners and let the market clear, and that same energy would flow where it belongs - into new candidates, new ideas, and politicians who must satisfy their general elections customers to survive.

Modern attempts to crack the market only prove the rule. Predating No Labels' effort, in 2012 the financier Peter Ackerman poured his own fortune and energy into Americans Elect, an audacious bid to put a bipartisan "unity" ticket on the ballot through the first-ever national online primary - its nominee required to choose a running mate from the opposing party. Ackerman's team did something almost unimaginable, winning ballot access in 29 states before a single vote was cast. Then it collapsed, in large part because no credible candidate would step forward. The serious contenders all understood what Ross Perot's example in the 1990s and, later, Joe Manchin would confirm: Under plurality rules an independent cannot win, only spoil. Americans Elect built the doorway. The spoiler problem meant no one dared walk through it.

Even more contemporaneously, a disillusioned Elon Musk vowed only last summer to launch a third party. Within a month, he'd pumped the brakes on it. Money wasn't the issue - he's the richest man in the world. The barrier is plurality voting and the dreaded "spoiler" label. This summer, Tucker Carlson merely floated a third party trial balloon, Within days, the chattering class was handicapping how Carlson's fantasy might spoil Marco Rubio's chance at the 2028 presidential nomination - and Republican chances generally.

Changing the status quo

The most devastating cost of a market with no real competition is not dissatisfying candidates. The true devastation: We don't get results.

Ask a simple question: When did this country last balance its federal budget? The answer is 1998-2001. President Bill Clinton and his working relationship with House Speaker Newt Gingrich are generally credited with this accomplishment. But most analysts have missed an essential driver: The last time we had balanced budgets followed soon after the last time we had genuine competition in the presidential general election. In 1992, billionaire Texan Ross Perot used his own fortune to do what our system almost never permits: Compete nationally as an independent because he didn't mind investing his own money in a spoiler race. His message was blunt - America was drowning in debt - and he delivered it himself, buying up half‑hour blocks of network television for folksy "infomercials" in which he stood before hand‑drawn charts and walked the country through the federal balance sheet. The first edition drew more than 16 million viewers.

On the first Tuesday of November, Perot won not a single electoral vote but nearly one-fifth of the popular vote. He lost, but citizens won. Before Perot's candidacy, neither the Republicans nor the Democrats had balanced budgets on their party platforms. He proved that deficit reduction had a constituency neither party could afford to ignore, or to cede to his nascent Reform Party. Competitive pressure persuaded Clinton and Gingrich that they had to tackle it. In the years that followed, Washington produced four consecutive balanced budgets, the first since 1969. Paul Begala confirmed the theory from the inside, writing in the Washington Post at Perot's death, "I am not sure we would have ever balanced the budget without the pressure Perot and his voters brought to the issue." Multiple factors contributed to the balanced budgets, but Perot delivered the otherwise never-existent "political will."

Here's the point: Competition changes results even when it doesn't change who wins. In Silicon Valley when a breakthrough technology emerges, if it benefits customers it will eventually make it to market. The new company will succeed in the marketplace on its own or it will be acquired or copied. Either way, consumers win. That's the alchemic brilliance of competition.

We desperately need dynamic competition in politics too - not just among candidates but for innovative policy ideas, and competition "to get shit done," to quote Joe Manchin in a recent interview making the case for independent candidates. In the political marketplace with only two competitors, neither of our two parties are incentivized to tell voters a hard truth or, more importantly, to do hard things like casting votes they know will help the country but perhaps put their political career at risk.

Add a third candidate who can, and the truth suddenly has a market. That is why there will never be a real candidate of fiscal sanity - on the debt, or on anything else that demands shared sacrifice or requires dealing powerfully with tradeoffs - until we eliminate plurality winners. In a marketplace with only two competitors, neither wins reelection if they do a hard thing - balancing the budget, reaching a bipartisan compromise on immigration, rethinking health care. So, they don't.

Healthy competition, in any human endeavor, delivers innovation, results, and accountability - all of which are sorely missing in our current politics. If we want the benefits of free market politics, we must tear down the barrier to entry that plurality winners create. The fix is simple: To win, you must earn a majority.

A preference for majority winners is neither radical nor new. The Constitution built in a safeguard for the Electoral College: If no candidate wins a majority there, the U.S. House picks the president in a "contingent" election. Massachusetts required a majority to elect its governor from 1780 until 1855. When no one won a majority outright, the choice fell not to the voters but to the state legislature.

A few states still use majority requirements today. Alabama, Arkansas, Georgia, Mississippi, North Carolina, Oklahoma, South Carolina, South Dakota, California, and Texas require majority winners in various races and use two-person runoffs to deliver those. The instinct is right. The mechanisms are the problem. Polarized legislatures breaking ties aren't acceptable today; that method does nothing to eliminate the deterrent effect of spoiler and wasted votes. Traditional runoffs are expensive, they demand a whole second election, and turnout collapses the second time around. Worse, a two-person runoff coming out of a crowded field can simply recreate the spoiler problem, as California's top-two primary has done - vote-splitting knocking out the majority's real choice before the final round.

The elegant answer is to hold runoffs instantly. Instant runoffs are mostly new to America, but they're time tested by other established democracies. The Australians and Irish have used them in various elections for more than a century. And, of course the idea of runoffs isn't foreign at all given their use in nine states. An instant runoff is exactly the same, except you don't have to come back to the polls for each new round. Instead, you rank the candidates from your first to last choice all at once (ideally on Election Day or in a mail-in ballot arriving by Election Day) using a ranked ballot.

After the polls close, assuming a dynamic five-person race, there are four runoff rounds.

  1. In Round One, your vote is cast for your favorite candidate (i.e., the one you ranked first on your ballot) just like always. At the end of the round, the candidate who came in fifth/last place is eliminated.
  2. In Round Two with four candidates remaining, your vote is cast for your favorite among the remaining four. At the end of the round, the candidate in fourth/last place is eliminated.
  3. In Rounds Three and Four, the process repeats, narrowing the four to three and then three to the final two, at which point, of course, majority wins.

Here's the part people worry about, so let's be plain: In every round, your vote goes to your favorite candidate still in the race. As long as your first choice is standing, that's who you're voting for - round after round. Your lower rankings are just backups. They come into play only if your favorite is knocked out, and then your vote moves to the next name on your list who's still running. It's exactly what you'd do in a Georgia or Texas or Louisiana runoff: Your candidate didn't make it, so you pick your favorite among those who did. The difference is only that you expressed your preference in advance, so you didn't have to make the trip back to the polling place.

One election. Five candidates. Four instant runoff rounds. One vote for each voter in each round. A majority winner. No spoiler.

'Frenemies' of reform

Those of us pushing for "Final Five Elections" (FFE) know what the ranked ballot conjures in those who are unconvinced. In no small part this is because liberal reformers have spent years giving it a bad name. They've deployed it in sleepy, low-turnout, low-information municipal races, and in cities like San Francisco they asked voters to rank long rosters of little-known candidates.

Democratic Party reformers added ranked ballots to party primaries in New York City, but they deliberately didn't install it in the general election because the Democrats didn't want real competition in November. They prefer knowing who to call "Mr. Mayor" after the Democratic primary in July. Reformers also like to pair a ranked ballot with proportional representation. The first is basically sabotage; the second is just a terrible idea. In both cases, they're using a tool for the wrong job. The instant runoff has one narrow use case for which it is tailor-made: a November general election with a manageable field of up to five candidates. Used there, it does exactly one job impeccably - it guarantees a majority winner with no spoiler. It's the key that unlocks healthy competition.

That is precisely how we use it in Final Five Elections. FFE is the combination of two simple changes to our election system: First, a single-ballot primary open to every candidate and voter regardless of party, and out of which the top five advance regardless of party; and second, an instant-runoff general election resulting in a majority winner. Open the market; require a majority. That is the whole design, and it is not just theory.

In 2017, I published my politics-industry theory out of Harvard Business School with my co-author, economist Michael E. Porter. Our work made its way to Alaska, where prominent Anchorage attorney Scott Kendall used it to design a ballot initiative built around these new rules. In November 2020 Alaska voters passed Final Four Elections (an earlier version of Final Five Elections in which four candidates advance to the general). Alaska became the first state in the nation to choose healthy competition in its elections for Congress and its entire state government. It won't be the last.

You could be forgiven for thinking Final Five Elections are about electing more moderates. They will certainly make that more likely - the market for moderate dealmakers doesn't clear today, and moderates are essential for delivering consensus solutions to tough policy challenges. But unlike the reformers who imagine that's the whole point, I don't see it that way. Reforms that provide artificially disproportionate advantages for moderates (e.g., Condorcet winners) are a bad idea. Innovation in any human endeavor usually emerges from what might be considered fringes or extremes. It's the same for public policy where innovation rarely arises at the current midpoint of public opinion. As Porter and I wrote in 2017, "transformational changes in the U.S. have often begun at the fringes - in decidedly non-moderate camps." Think civil rights. We need moderates and we need "extremes." We need a competition of ideas. What Final Five Elections really does is let both markets clear at once - the market for dealmakers and the market for leaders and new ideas.

To envision what Final Five Elections would change, watch what's happening right now - then imagine the same candidates, the same voters, the same political mood, under different rules. This season, Democratic socialists won a string of Democratic primaries in places where the primary is the only election that matters. In Denver's safe-blue 1st District, 29-year-old Melat Kiros, backed by Bernie Sanders and the DSA, ousted 15-term Rep. Diana DeGette by more than 13 percentage points. In Upper Manhattan, Darializa Avila Chevalier knocked off five-term Rep. Adriano Espaillat. Because these are overwhelmingly Democratic seats, that small, committed primary electorate didn't merely choose a nominee - it chose the member of Congress even though the general election is still months away. General election voters who might have preferred the non-DSA Democrats will never get a say.

Now run those same races under Final Five Elections. The socialists would still claim a spot on the November ballot but they could no longer back into the seat as the only Democrat on offer, or as the lesser of two evils. To win, the socialist would have to assemble an actual majority of the entire district. The same logic runs on the right - which is why MAGA would still exist under Final Five Elections but would likely not have rendered establishment Republicans extinct. In Texas, John Cornyn led the first round of the Senate primary and still lost to Ken Paxton in a low-turnout runoff decided by the base - even as analysts judged Cornyn the stronger November candidate. In Louisiana, Bill Cassidy was eliminated by his own party's primary voters, punished for a vote of conscience against Donald Trump. Under Final Five Elections, Cornyn and Cassidy would each have stood on the November ballot beside their Trump-endorsed challenger (and the leading Democrat) and the whole electorate - not a closed-primary faction - would decide the race. If MAGA earns a majority, MAGA wins. If it doesn't, the establishment Republican, or an over-achieving Democrat, prevails.

To be clear, while I am no fan of the Democratic Socialists' platform, my objection is not that they might win, it's that we could back into their agenda - not because a majority of Americans chose it, but because a structural error in our democracy routinely distorts our elections. When and if DSA candidates win and their policies are tried in a laboratory of democracy (as in Mamdani's grand New York City experiment), I bet voters will discover what history has already shown: Socialism doesn't work.

Under Final Five Elections, voters would have a way back, because traditional Democrats wouldn't be extinct or new alternatives to the DSA would be able to enter. Under Final Five Elections, Mike Pence Republicans would have market access to compete for the post-Trump right-of-center vote. And for ideas that do work from any of these competitors, they can be adopted by other parties. I do this work because I believe in the value of competition. Even if certain candidates don't win, some of their good ideas might be adopted by those who do, a la Perot. That's as it should be.

In evaluating Final Five Elections, it's essential to see that it is not the sum of its parts. It is one machine whose several precision components work only in combination, engineered to deliver a single result: a majority winner drawn from a field of up to five credible candidates in November. Adopt just one component - ranked ballots, say, or some version of an "open" primary - and nothing structural moves. The piece that does the real work is the one most reformers omit: advancing five candidates from a single open primary into the general, so that the decisive, competitive election is November and not a low-turnout party primary.

Washington, D.C., shows what happens when that piece is missing. There, reformer Lisa Rice led an impressive campaign to pass Initiative 83, which put ranked ballots in both the primaries and the general and even opened those primaries to the District's independents - several of the "parts," adopted at once, with real skill and the best of intentions. But Rice's hands were tied by D.C.'s Home Rule Act which bars an essential piece - the top-five primary that would carry five candidates into a contested November - and so the dynamics of the election didn't change in Final Five style because party primaries still exist and each advance only one candidate to the general.

As a result, we saw a campaign similar to other DSA races: In June 2026, Councilmember Janeese Lewis George, a democratic socialist, won the Democratic mayoral primary and, in a city this blue, is all but certain to become mayor, with no credible contender waiting in the general. The primary still crowned the winner. Notice, too, what this reveals about the ranked ballot: In a low-turnout, low-information primary, ranking is an unnecessary complication. In Final Five Elections the primary is a simple "pick-one." You choose your single favorite, as always, and the top five advance; ranking does its real work later, in the general, where it forges a majority from genuine competition.

Opening the primary as a stand-alone reform, which is currently advocated by many major reform organizations, is not the missing piece either. The impulse behind it is understandable: If the party primary is the election that truly decides, then shutting independents out of it really is unfair. But the best cure for that unfairness is not to usher outsiders into a party's nomination; it is to make the general election the contest that matters, so that everyone is finally voting in the election that counts. Making a broken election system "fairer" is not the same as making it work, and we must not let the fix for a real unfairness talk us into a reform that leaves us just as unlikely, or more so, to get results.

Many reformers who have adopted my prescription for Final Five Elections nonetheless incorrectly suggest that FFE will weaken parties and describe that as a benefit. I believe those reformers are wrong on both counts. I am a fan of political parties, and, like esteemed political writer Jonathan Rauch, I want them strong - because in the industries that serve us best, you always find strong players. The trouble with our parties isn't that they're strong. It's that their strength is artificial. They are powerful in the one way no healthy competitor should ever be: They have demonstrated a nefarious talent for keeping rivals out of the market altogether. In the one place they ought to be strong - choosing the candidates who can actually win a November majority and deliver on the party's agenda - they've grown weak, even too weak for their own good or ours. The current system is why Mitch McConnell lamented "candidate quality" in 2022 when he didn't get the strongest general election candidates out of the Republican primaries. Separate the public function of the election from the parties' private one of choosing nominees, and we can finally afford to let the parties truly control their candidates, because the voters keep ultimate control at the ballot box. FFE is a win for (well-run) parties and for voters.

Now to the critics of Final Five Elections - and I have heard from a lot of you: You say it's a liberal plot. It isn't. Final Five forces every candidate, left and right, to win an honest majority. (For a strong proof point, in 2022 Nevada Democrats hired famed partisan lawyer Marc Elias to try to shut down FFE ballot initiatives, and defeating Final Five Elections was about the only thing the D and R parties agreed on in 2022 and 2024. Neither of them wants new competition.)

Critics also say it's too confusing. But surely Americans are as capable as the Australians and the Irish? And mainlanders as capable as Alaskans? You say it delays results. It doesn't. As long as the ballots are required to be submitted by Election Day and election authorities release the cast-vote record data, AP can call races on election night just like they do today. You say it's an incomprehensible algorithm. It isn't; you can use paper ballots, count manually and conduct a manual recount on any race if you want (though if you want results on Election Day, I'd suggest a computer). Used as a tool to support the emergence of the majority winner in a five-way general election, FFE is none of the things you say it is.

So here is my challenge. Don't just tell me what's wrong with Final Five Elections. Show me another plan that produces healthy competition of both candidates and ideas and the resulting benefits to customers, a.k.a. American citizens. If you do find a better one, I'll happily get on board with yours. But assuming you can't, it means that what the critics of FFE are really defending, whether they admit it or not, is the failed status quo - intense polarization, division and dysfunction, gridlock, party capture, and dismal policy results - over dynamic competition to solve problems. The United States became the most powerful and prosperous nation in human history for a reason we ignore at our peril: We unleashed free market-style competition and let it do its work. Competition is what drives our innovation. Competition is what lifted American life to a standard the world had never seen. America deserves the same exemplary results from free market politics.

And a special note to my conservative critics, chief among them the Wall Street Journal editorial page. You should be the last to need convincing. No entity has taught American readers more faithfully than you that market competition positively motivates incumbents and serves customers, and that artificial protectionist barriers to entry are the enemy of both.

Yet, you have been consistently hostile to Final Four Elections adopted by Alaska in 2020. Don't let the ranked ballot's abuse in the wrong hands blind you to its one indispensable use. Confined to a five- (or four-) candidate general election, the instant runoff does exactly one job: It demolishes the single greatest barrier to entry in American politics - the spoiler - and forces every candidate to win real competition on the merits. That is not a left-wing scheme (or a right-wing one). It is free markets for our republic, and it is the purest application of your own creed I can offer arriving, at last, in the one market where you have been strangely content to let a protectionist market thrive.

Our call to action goes out to all governors and state legislators. The Founders anticipated this moment and, in Article I, handed the power over the machinery of elections to the states. The Constitution provides that "the Times, Places and Manner of holding Elections... shall be prescribed in each State by the Legislature thereof." The rules of the game, for both state and congressional elections, are yours to write. Final Five Elections is not a pie-in-the-sky idea; it's actionable now, by any governor or legislature willing to lead. I can't imagine a better test case for laboratories of democracy than Final Five Elections in a handful of states. Over time, the results will create demand for expansionor - they won't. I'm betting on FFE.

But of course, governors and legislators can only do what their citizens ask of them. So here's to you citizens: It is crazy, when you actually stop and think, that we accept our current state of affairs as if we're powerless. The most detrimental driver of American politics is sitting in plain sight, and almost no one names it. Turn on the news and you'll hear endless coverage of the DSA's rise or MAGA's takeover treated as ideological weather and never as what they actually are: structural, the predictable product of party primaries and plurality rules.

Here's to you, journalists: It is crazy that the people whose whole job is to explain the world keep missing the one explanation that ties it together - that there are barriers to entry, and that those barriers, not the passions of the moment, are why we can no longer solve problems.

Here's to you, business leaders: You of all people should see this instantly, because it is your world exactly - a market, protected incumbents, competition strangled, customers ignored - and yet even you look right past it.

Here's to you, editorial boards, forever demanding better behavior from politicians while ignoring the rules that guarantee the behavior you claim to deplore: We do not need more outrage at the symptoms. We need people to finally understand the cause and then to do something about it. Because the extraordinary thing, once you see it, is that this is not rocket science. In the scheme of political challenges, it's not overwhelmingly hard. The fix is not a constitutional amendment. It does not require an act of Congress, or the consent of 50 states, or even two. A single state can adopt Final Five Elections on its own, through its legislature or by ballot initiative, at no cost to its neighbors and enormous benefit to its own citizens. As hard as our politics feels, this part is not that hard.

And to the frustrated business titans who keep circling this problem without solving it, this one is for you. Elon Musk, enraged at both parties, floated an "America Party." Howard Schultz, disgusted with the duopoly, explored an independent run. Mark Cuban tells all who will listen that both parties have failed us. Gentlemen: You are brilliant innovators, and you are misdiagnosing the problem. If this were your company, you would never pour a fortune into a doomed product line inside a rigged market. You would fix the market. That is the move here. Stop trying to win the broken game and start championing the rule change that ends its rigging for good. Put the same relentless, systems-level thinking that built your fortunes behind Final Five Elections in a few states, and you will do more for this country than any third-party campaign ever could. At the very least, Mr. Musk, don't fund the effort to repeal Final Four Voting in Alaska, the one state in which you could launch your new party without undue barriers. Give me a call. I think you've received bad counsel.

This has been a long argument. So let me reduce it to its essence - two images. In Image A, our current system, there is virtually no connection - no overlap at all - between our politicians solving problems in the public interest and the likelihood that they get reelected. Sit with that, because it is the whole tragedy in a single sentence: If America's elected representatives did their jobs the way we actually need them to, they would be more likely to lose those jobs (in their next low-turnout party primary) than to keep them. Congress doesn't solve problems because, under the current rules, solving problems is not a good way to win an election. In fact, it's a good way to lose one. No one would ever design a hiring-and-firing system like that on purpose. And yet here we are.

Final Five Elections does one essential thing: it creates the connection in Image B. It makes solving problems a good way to win - and to win again. Under these rules, what it takes to get elected finally overlaps with what it takes to serve the public interest, and in that overlap sits everything we have been missing: results and accountability. That overlap is the whole secret. Everything else in this essay - the open primary, the instant runoff, the majority winner, the end of the spoiler - is simply the machinery that produces it.

My passion may inadvertently suggest I'm presenting Final Five Elections as the gateway to a political utopia. It's not. I agree with Winston Churchill that "democracy is the worst form of government, except for all those other forms that have been tried from time to time..." Democracy is messy. It is hard. What we have now messy, hard, and bad results. With Final Five Elections, we'd still have messy and hard - but with some good results to show for it. That is utopia for democracy.

Katherine Gehl, former CEO of Gehl Foods, is the author of "The Politics Industry: How Political Innovation Can Break Partisan Gridlock and Save Our Democracy" and the architect of Final Five Elections.

Tyler Durden Sun, 08/23/2026 - 23:20

Evergrande Founder Gets Life But Homebuyers, Suppliers Bear The Costs Of China's Property Collapse

Zero Hedge -

Evergrande Founder Gets Life But Homebuyers, Suppliers Bear The Costs Of China's Property Collapse

Authored by Michael Zhuang via The Epoch Times,

The sentencing of China Evergrande founder Hui Ka Yan to life in prison has brought a legal reckoning for one of the country's most spectacular corporate collapses. However, for hundreds of thousands of homebuyers, investors, and other creditors, the ruling does little to resolve the financial losses left behind by the property giant.

Xu Jiayin, also known as Hui Ka Yan, founder of property developer Evergrande, appears for sentencing at the Shenzhen Intermediate People's Court in Shenzhen, China, on Aug. 20, 2026. Shenzhen Intermediate People's Court /Xinhua via AP

Hui, the founder and former chairman of China Evergrande Group, was sentenced on Aug. 20 after being convicted of crimes including fundraising fraud and embezzlement. His personal assets were confiscated, while Evergrande and its property subsidiary were fined a combined 15.82 billion yuan ($2.35 billion).

Chinese authorities also ordered the continued recovery of illegal proceeds and repayment of losses where funds remain insufficient. Fifty-six other people involved in related Evergrande cases, including Hui's two sons, were given prison sentences ranging from 18 years to one year and 10 months, along with fines or asset confiscations.

Separately, on Aug. 21, the Guangzhou Intermediate People's Court accepted a bankruptcy-liquidation application against Evergrande Real Estate Group and appointed a liquidation team as administrator, according to an official court bankruptcy notice. Creditors are being directed to file claims in that proceeding.

The penalties, however, do not automatically compensate the people who lost money when Evergrande collapsed.

Evergrande reported total liabilities of 2.437 trillion yuan at the end of 2022, including 721.021 billion yuan in contract liabilities, of which 664.244 billion yuan related to property development. Reuters later cited Gavekal Dragonomics as estimating that Evergrande's advance payments from homebuyers were equivalent to about 600,000 housing units.

Davy Jun Huang, a U.S.-based economist and former columnist for Chinese state media outlet CNTV, told The Epoch Times that Hui's life sentence answers the question of who committed crimes, but does not answer who should bear responsibility for Evergrande's enormous debts and unfinished projects.

"These are two completely different questions," Huang said. "The harsher Hui Ka Yan is punished, visually it feels like the problem has been solved, but in reality, the houses will not automatically be completed because of this, and creditors' money will not be recovered because Hui Ka Yan has been sentenced."

The question of who ultimately absorbs Evergrande's losses is likely to remain more consequential for ordinary Chinese than Hui's punishment.

Who Will Pay?

Evergrande's collapse has left losses spread among several groups, including homebuyers, suppliers, banks, investors, and other creditors.

Huang argued that the fines imposed on Evergrande and its property subsidiary do not themselves amount to direct compensation for homebuyers or unfinished projects. An official Supreme People's Court summary adds an important qualification: restitution for losses takes priority over enforcement of fines and confiscation, while illegal proceeds are to be recovered and any shortfall is subject to restitution. Huang argued that the losses from Evergrande had effectively been distributed throughout society among homebuyers, suppliers, and investors.

This has fueled broader debate over whether the regime should use other revenues associated with the property sector to compensate victims.

Huang said such demands were reasonable from both legal and economic perspectives. He pointed to the U.S. government's 2008 intervention in Fannie Mae and Freddie Mac as an example of the government assuming responsibility when a major part of the housing finance system was threatened.

China's regime, he said, played multiple roles in the property boom, as the dominant supplier of land, regulator, and major beneficiary of property-related revenue, but did not assume the corresponding losses when the market collapsed.

"When real estate was rising, the government used land-sale revenues, land-transfer taxes, and layers of extraction to squeeze out the last penny," Huang said. "When the real estate bubble burst, under the Chinese Communist Party's (CCP) political model, the government would not bear any of the losses."

The halted under-construction Evergrande Cultural Tourism City in Taicang, Suzhou city, in China's eastern Jiangsu Province, on Sept. 17, 2021. Vivian Lin/AFP via Getty Images Suppliers Face Steep Losses

The impact of Evergrande's collapse extends well beyond unfinished apartment complexes.

Xu Zhen, a senior professional in China's capital markets, told The Epoch Times that China's local governments were among the biggest beneficiaries of Evergrande's expansion. He estimated that local governments collected roughly 1.2 trillion to 1.7 trillion yuan ($180 billion to $250 billion) in land-sale revenues and taxes directly associated with Evergrande between 2016 and 2021.

That money had already entered regime coffers and would not be affected by Evergrande's bankruptcy or Hui's imprisonment, Xu said.

Xu also argued that state finances would benefit from the penalties. That point is subject to the judgment's express restitution priority, which can affect the order in which recoveries are enforced.

Banks initially benefited from lending to Evergrande but later became creditors themselves. Some of their claims were eventually sold at steep discounts after the company's collapse. Xu cited a claim held by China Minsheng Bank that was ultimately sold for roughly 13.5 percent of its original value.

Homebuyers have faced a different kind of loss - years of waiting while continuing to carry mortgages on homes they may not be able to occupy.

However, Xu identified suppliers as the group that suffered the most severe financial damage.

Under a 2023 Supreme People's Court interpretation, qualifying consumers who bought homes for residential use can, if statutory conditions are met, assert delivery or refund claims ahead of construction-price priority claims, mortgages, and other claims. Construction contractors and secured creditors otherwise retain separate priority rights. Evergrande's June 2023 interim results reported 1.05657 trillion yuan in trade and other payables, including 596.17 billion yuan in construction-material payables.

The debts affected thousands of small and medium-sized companies, many of which had limited bargaining power and few legal resources.

Some construction contractors and materials suppliers collapsed after failing to collect commercial bills issued by Evergrande. In the liquidation of an Evergrande project company in Zhanjiang, ordinary creditors ultimately received a recovery rate of about 0.69 percent, according to Chinese financial reports; Reuters also cited the figure in April 2026.

Evergrande said its targeted wealth-management financing products totaled approximately 92.1 billion yuan, with about 34 billion yuan in unpaid principal and interest as of the end of 2022. Separately, Reuters reported in 2021, citing an Evergrande Wealth sales manager, that more than 80,000 people had bought wealth-management products that raised more than 100 billion yuan over five years.

Evergrande's shares have also been delisted, leaving many retail investors with substantial losses.

Construction workers rent shared bicycles as they leave a building site for a new office tower in the Central Business District of Beijing on April 3, 2025. Kevin Frayer/Getty Images A Boom Built on Political Ties

The collapse has also revived questions about how Evergrande grew so rapidly in the first place.

Taiwan-based Japanese journalist Akio Yaita, a prominent critic of the CCP, told The Epoch Times that the company's downfall was not simply the result of excessive leverage and a bursting property bubble. He said it exposed deeper problems in China's system of political and business relationships.

As long as entrepreneurs maintained strong political connections, Yaita said, access to land, regulatory approvals, and financing becomes much easier. Rising property prices then allowed companies to expand rapidly.

However, such a model was inherently vulnerable to changes in political power, he said.

"China's system makes it difficult to produce people like Konosuke Matsushita, YK Pao, and Morris Chang, who build corporate culture and industrial foundations over decades, and it is also difficult to produce entrepreneurs like Elon Musk and Jensen Huang, who rely on technological innovation to change the global industrial landscape," Yaita said.

Instead, he said, the system was more likely to produce entrepreneurs who rose rapidly through political connections and then fell just as quickly when those political relationships changed.

Huang described Evergrande's rise as a form of mutually beneficial cooperation between business and the regime.

During the property boom, he said, developers helped local governments generate land revenue and economic growth, while banks expanded lending and met credit targets. The interests of developers, banks, and government officials were therefore aligned.

Huang said he visited Evergrande's headquarters in 2018 to give a lecture on policy analysis and forecasting and warned Hui that the company should stop expanding after 2018. Hui and the company did not heed the warning, he said.

That does not absolve Evergrande or Hui of responsibility, Huang said.

However, the collapse illustrates a broader problem. According to Xu, private property developers can become highly dependent on a system in which land and access to capital are heavily controlled by the state.

"From an employee to a scapegoat is the fate of private real estate owners under the CCP's monopoly over land and capital," Xu said. "Hui Ka Yan is a typical example."

"If you do well, the CCP lets you gain both fame and fortune; if you do badly, it makes you a prisoner," he said.

Hui's imprisonment therefore does not end the questions raised by Evergrande's collapse. For the company's former customers and creditors, the larger issue remains who will ultimately bear the cost and whether any of the money and homes lost in the collapse can be recovered.

Tang Bing and Luo Ya contributed to this report.

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Tyler Durden Sun, 08/23/2026 - 22:45

Has Trump Turned The Tables On Iran - Or Is Another Round Of War Coming?

Zero Hedge -

Has Trump Turned The Tables On Iran - Or Is Another Round Of War Coming?

Authored by Trita Parsi via Antiwar.com, reprinted with permission from Trita Parsi's Substack.

The Trump administration believes it has turned the tables on Iran. Washington assesses that the rerouting of maritime traffic through the Omani corridor, combined with a global shift away from Persian Gulf oil, has reduced the effectiveness of Tehran's closure of the Strait of Hormuz. At the same time, the U.S. blockade has sharply constrained Iran's ability to sell its oil. The result, in Washington's view, is a status quo that imposes greater costs on Iran than on the United States.

That calculation changes the strategic equation. Rather than being forced to accommodate Iranian demands, President Donald Trump now believes he can afford to wait Tehran out. For the first time since the war began, the White House has concluded, time is working in America's favor.

Assuming that assessment is correct, the more important question is what Trump intends to do with this newfound leverage. If Washington interprets Iran's vulnerability as an opportunity to extract capitulation rather than to negotiate a durable settlement, the result is more likely to be another round of war than an end to the conflict. Tehran has already demonstrated that when confronted with a choice between surrender and escalation, it will choose the latter. Giving Iran the same choice again is therefore unlikely to produce a different outcome.

The only way to turn this unexpected shift in the balance of leverage into a political victory is through diplomacy. If Washington's assessment is correct, it now has an opportunity to use its leverage to secure a compromise that addresses its core interests while giving Tehran sufficient reason to accept an agreement. If, instead, the administration pursues maximalist demands, it risks converting a moment of leverage into another cycle of war.

Historically, however, Washington has tended to make precisely this mistake. Whenever U.S. policymakers have concluded that time and leverage are on their side, they have often treated Iranian weakness not as an opening for compromise, but as an opportunity to seek capitulation. The danger is that Trump will repeat that pattern. He will mistake leverage for victory and turn a potentially favorable negotiating position into the continuation of the tragedy that is US-Iran relations.

Trump failed militarily, but thinks he can win economically

America has run out of military options. The clearest indication is that the Trump administration has stopped striking Iranian targets even as Tehran continues to attack ships transiting the Strait. On Monday, an Iranian attack killed a sailor aboard a vessel using the southern corridor. Yet Washington did not respond militarily - even though the second round of the war began precisely because the administration had declared that it could not accept Iran firing on ships.

According to Reuters, U.S. forces have used virtually all of their global stockpile of ATACMS and Precision Strike Missiles (PrSM) during the five-month Iran conflict. Moreover, roughly 65% of Patriot interceptors, 38% of THAAD interceptors, and almost half of the Navy's Tomahawk cruise missiles have been expended.

The depletion of these stocks appears to have forced Trump to abandon its pursuit of a military knockout and instead shift the burden of economic pressure onto Tehran. That strategy, in turn, appears to be producing results faster - and to a greater degree - than the administration anticipated.

In the American description of events, this success is mainly due to three factors: New, much larger ships are being used that carry primarily crude oil. These VLCCs (Very Large Crude Carrier) can carry up to 2 million barrels of oil. In comparison, other oil tankers can transport between 350,000 and 1 million barrels.

Before the outbreak of the war, approximately 21 million barrels of petroleum and crude oil passed through the Strait of Hormuz on a daily basis. These were carried by 65 to 80 tankers. Roughly the same amount of oil transition through the strait can now be achieved by only ten VLCCs a day. And given that the vast majority of ships transitioning through the Strait in the Southern Corridor have their transponders off, this traffic has not been noted by outlets tracking the traffic.

Secondly, demand for Persian Gulf oil has significantly dropped as numerous economies have started to transition to other sources of supply. Brazil, for instance, has increased its exports and started to serve markets that previously relied on Persian Gulf oil. Most importantly, Beijing appears to have deliberately reduced its oil consumption to prevent prices from remaining above $100 a barrel and thereby aggravating the risk of a global recession.

Third, the war has created economic incentives strong enough to attract ships and crews willing to assume substantially greater risks. The growing volume of traffic through the Southern Corridor, despite the obvious dangers, is evidence that these incentives are surprisingly powerful.

Unlike its earlier illusions about the blockade as a guaranteed knockout blow against the Iranian theocracy, Washington no longer expects economic pressure to produce a quick surrender. Instead, the administration appears to be betting on a slower process of economic strangulation that will eventually force Tehran to capitulate. Faith in a knockout blow has given way to the more fragile hope of prolonged strangulation.

Tehran isn't worried - for now

Iran's calculation is effectively the opposite of Washington's. Tehran doubts the United States can sustain the flow of VLCC traffic through the Strait and believes Trump will have little choice but to return to the Islamabad MOU within the next two to three weeks. Trump may have made progress on oil exports, but LNG and many petrochemical products, including fertilizers, remain unable to leave the Persian Gulf.

Tehran also appears to believe that it retains the ability to halt the VLCC traffic, but is deliberately refraining from doing so for now. The calculation is to avoid escalation while waiting to see whether the United States' depleted military options ultimately compel Trump to return to the MOU.

In short, Tehran does not appear overly concerned - for now. But that could change. If Trump refuses to return to the MOU, or succeeds in turning the balance of economic pain against Iran, Tehran will face a far harsher reality. Just as Washington underestimated Iran's resilience, Tehran may have underestimated the both resilience of the global economy and Trump - the former's ability to shift away from oil and the latter's craftiness in finding non-military ways to effectively reopen parts of the Strait.

Between surrender or escalation, Iran will almost certainly choose escalation. Even if Trump has gained the economic upper hand, Tehran still believes it holds a military advantage. Its options range from more aggressive attacks on VLCCs to strikes on Emirati pipelines that bypass the Strait, and potentially to renewed escalation in the Red Sea.

Indeed, it was precisely Trump's erroneous assumption that Iran would choose surrender over war that helped drive the United States toward escalation in the first place. Washington's recurring search for Iran's breaking point has repeatedly produced escalation rather than capitulation. There is little reason to expect the pattern to be different this time.

The US-Iran tragedy

Herein lies the tragedy of the lethal dance between Washington and Tehran. America's winner-take-all approach makes agreement unacceptable when Iran has the momentum. When the momentum shifts to Washington, the United States comes to believe that nothing short of Tehran's full capitulation is palpable.

Because Iran fears surrender more than war, the cycle oscillates between economic pressure and military escalation, interrupted only by brief and often fragile periods of diplomacy. Put simply, the structure of the situation favors war.

This is particularly visible today as neither side is investing in any real diplomacy with the other. Tehran's "diplomacy" is to simply wait for Trump to return to the MOU, while Trump has barred U.S. officials from engaging with Iran and committed himself instead to economic warfare.

When you don't negotiate when you're weak, because you are weak, and you don't negotiate when you are strong, because you are strong, then war becomes the baseline.

Trita Parsi is the Executive VP of the Quincy Institute for Responsible Statecraft and an award-winning author. Washingtonian Magazine has named him one of the 25 most influential voices on foreign policy. Noam Chomsky calls him "one of the most distinguished scholars on Iran"

Tyler Durden Sun, 08/23/2026 - 22:10

Assassination Sing-A-Long: Hasan Piker Mocks The Murdered Charlie Kirk To Cheering Crowd

Zero Hedge -

Assassination Sing-A-Long: Hasan Piker Mocks The Murdered Charlie Kirk To Cheering Crowd

Authored by Jonathan Turley via Jonathan Turley,

We have seen protesters on the left around the country mocking the assassination of Charlie Kirk, even reenacting his murder. Hate traffickers like Jennifer Welch have even justified his assassination. It is all shocking and depressing, but none reached the level of Hasan Piker leading a huge crowd in mocking Kirk and his faith. Before he was murdered, Kirk debated Piker and called him a "socialist hypocrite." What is shocking is not the utter depravity and cruelty of Piker, but the ecstasy of the crowd in relishing the death of someone with opposing views. It is part of the conditioning in what I have previously called an "age of rage."

In the video, Piker leads the crowd in the meme song "We Are Charlie Kirk" at a stop of his "Fear& LIVE" tour, including such lines as "We are Charlie Kirk, we carry the flame. We'll fight for the Gospel, we'll honor his name." His co-hosts and the crowd seem to be laughing with joy.

Joining him at this hatefest at the Golden Gate Theatre in San Francisco on August 21 were reportedly Will Neff, QTCinderella, and AustinShow.

Hasan is wearing his now-signature Mao jacket as the young crowd and his co-hosts laugh hysterically. It is the very essence of this movement to desensitize people, particularly young people, to violence and hate.

In Rage and the Republic, I wrote about this national ragefest. It allows people to hate completely and without thought to the humanity of those being hurt. What people will not admit is that they like it. Rage is addictive, and it is contagious. Just look at the crowd in San Francisco, and you will see the addictive quality of uncut, undiluted hate:

Piker, Will Neff, QTCinderella, AustinShow, and these fans have every right to spread hate. It is protected speech just as KKK and neo-Nazi groups are allowed to promulgate their own hateful values.

What is exasperating is how hatemongers on the left want to enjoy hate speech while accusing others of hate and intolerance. They do so by excusing their actions or views by demonizing those who disagree. Democratic leaders continue the false claim that democracy is dying in America and that this may be our last free election. While made over multiple elections, the claim of the imminent death of democracy (unless they are elected) does not appear to register with their supporters.

Recently the rhetoric has reached hysterical levels. Florida Democratic Senate candidate Angie Nixon has compared Immigration and Customs Enforcement agents to "modern-day slave catchers" and the government is "literally trying to kill us."

It is a narrative that allows you to speak like a Nazi while claiming to be fighting Nazis.

Piker thrilled the crowd by mocking a murdered man over his faith and his death. It is more than being simply classless. It is commodifying rage. Piker is reportedly raking in a fortune as are other hatemongers like Jennifer Welch. They traffic in rage to a nation of rage addicts.

It is a scene that only reaffirms the work of Kirk who sought to expose the hate and intolerance of the left, particularly on our campuses. Kirk infuriated many by challenging them to debate. There is no room for reason in an age of rage. Those who try to introduce opposing views on campuses are cancelled or attacked.

Recently, a group of pro-life teenagers were kicked out of the Wydaho Roasters coffee shop in Idaho by an owner who found their presence intolerable. At universities, faculty members have attacked displays and even students in righteous rage. One professor who pleaded guilty to assaulting pro-life students was not only attained on the faculty but even honored by another school.

Civility, and even humanity, become signs of weakness in these times. They gravitate to figures like Abdul El-Sayed who has campaigned with Piker and promises to "choke out" Republicans and refers to moderates like Pennsylvania Sen. John Fetterman (D) as ogres to have their heads cut off and put on pikes.

The American left has found their berserkers, the old Norse warriors who were known to fight in a virtual violent trance. The new berserkers offer the chance to hate completely and without remorse or reflection. Over time, supporters are conditioned to disregard even the murder of those with opposing views. As shown in San Francisco, assassination becomes nothing more than a sing-a-long in an age of rage.

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

Tyler Durden Sun, 08/23/2026 - 21:00

The AI Boom Runs On Tungsten, But Global Supplies Are "Running On Empty"

Zero Hedge -

The AI Boom Runs On Tungsten, But Global Supplies Are "Running On Empty"

Authored by Almonty Industries CEO Lewis Black [emphasis our own], 

Plenty to delve into with this edition: a stockpile order nobody can fill, two factory shutdowns that should be on your radar and the awkward truth about how few tungsten projects will ever produce a single tonne. It's a busy one. In we go.

Cash in hand but no one's selling

Earlier this year America's strategic stockpile did something that should have been routine and instead caused a small panic. The Defense Logistics Agency – the people who hold the national reserve – went out to the market asking what tungsten would cost. Not an order. Just a question: what's the price?

The market recoiled. There was no spare material to be had, prices were already climbing and here was the US government signalling it might step in and buy at scale. The existing consumers – the people who turn tungsten into the things the military needs – were not pleased about a state-backed competitor showing up. The complaints landed and the request quietly went nowhere.

Because a government agency isn't allowed to move the market it's buying in – its own mandate forbids shoving the price around with taxpayer money. So the buyer who most needs the material legally can't buy it at scale without breaking its own rules. Worse still: the day the DLA puts out an open call for tungsten, it's told every adversary exactly where the soft spot is. You need the munitions, and you're advertising that you can't make enough of them.

The problem is that 30 years of cheap and outsourced can't be undone in two. It's like eating fast food every night for decades – inexpensive, easy, you feel fine, until you're at the doc being told you have terminal health problems. Reshoring is like going back in the kitchen: the shopping, the prep, the washing up. A pain. But the alternative is worse.

There's tungsten in the world. There just isn't much the Pentagon can legally get its hands on – non-Chinese, uncommitted, deliverable at scale. The little the West produces is spoken for. Ours is sold years out. That's not me dodging the point – that is the point. When even the producers are sold out, there's nothing left for anyone to stockpile.

Tungsten markets

Michael Dornhofer, ISBP – assessment as of 14 August, 2026

The response to my last note surprised me. After 20 years in tungsten, I have rarely seen this much interest in the metal – which tells you how hot the price and supply situation has become.

There is still little activity on the tungsten spot market, and so no clear price trend can be seen. Some data providers report slightly lower world-market prices, others keep their figures unchanged, and Chinese domestic prices are even rising. In general, the APT price in the West remains above 3,000 USD/mtu WO₃.

Image via Cantor Fitzgerald: 

Slowly, more downstream companies are realizing that it is not only raw-material prices going up – the whole industry is in a real supply crisis.

The situation in Japan is especially severe. From last year, the tungsten trade between China and Japan came almost to an end, and since the start of 2026 no APT at all has been delivered from China to Japan. That has put Japanese hardmetal and tool producers in serious trouble.

In reaction to the missing Chinese raw material, Japan significantly increased its scrap imports over the last twelve months. Now, however, the USA – one of its main sources – has stopped the export of tungsten-containing scrap by imposing export restrictions. Some market participants say there is not yet enough recycling capacity in the US to process all the scrap it generates, so that without exports there could be an oversupply at home, and pressure on domestic scrap prices.

Some European and US tool producers are also complaining about shortages of raw material. Most confirm that, although they have had to raise their prices, demand for their products has not dropped – which is not surprising: nobody stops building cars or aircraft simply because the tools cost more. It confirms that tungsten demand, at least in the short and mid term, is not elastic to price.

We are in for a very interesting fall and winter.

Michael Dornhofer is founder of ISBP (Independent Supply Business Partner) in Graz, Austria. He has spent more than 20 years in tungsten, including 13 years at Wolfram Bergbau und Hütten, Sandvik's tungsten business, and has worked as an independent agent and consultant to the tungsten and hard metal industry since 2019.

Running on empty

While everyone watches the defense story, you need to keep an eye on semiconductors too. There's a gas called tungsten hexafluoride – WF₆. It's what lays down the microscopic tungsten wiring inside advanced memory chips, the kind the entire AI boom is built on. No WF₆, no advanced chips.

Two Japanese producers, Kanto Denka and Central Glass, made about a quarter of the world's supply between them. Past tense. As of the first of July, they stopped. Not an accident on the factory floor – they ran out of the pure tungsten powder they need, the powder comes from China, and China stopped letting it leave the country in 2025. The Japanese producers ran on stockpiles until the stockpiles were gone. Then so were they.

Samsung and SK Hynix are now scrambling to qualify new suppliers – normally a year-and-a-half job they're trying to do in a hurry – and prices for the gas are being talked about 70 to 90 percent higher for the back half of the year.

So who's filling the gap? China. A Chinese producer has already announced it's expanding WF₆ capacity by a thousand tonnes a year. So: China restricts the raw material, the producers who depend on it go dark, and Chinese producers expand to serve the customers those factories just lost. Starve the competition, inherit the market. I'm not saying anyone drew it up that way. I'm saying it works whether they did or not.

Tungsten stopped being a mining story a while ago. It's a memory story, an AI story, sitting a link or two up from almost everything you're told is the future. It took two factories few people have heard of going quiet to show it.

Everyone's got a tungsten project. Almost nobody's got a tungsten mine.

Ask the strategic metals crowd to name the projects riding to the rescue and you'll get a list that comprises real resources, mostly run by serious people.

Then ask which is producing tungsten today, and the room goes quiet. There's one that went into administration a while ago, which wiped some of its permits, and it's been clawing them back ever since. Even now it's in a phased restart and the financing is still not closed. Elsewhere, there are some former Soviet holes in the ground that Moscow never finished, (China's already taken the best one), and the New York Times had plenty to say about that operation. Then comes the investment decision, engineering, construction, commissioning. Nobody's buying tungsten from there this decade.

I've bored you before on why tungsten resists going from deposit to metal, so I won't again. What's crucial is that Sangdong is processing – not next year, not after a study, running. When the whole field is measured in "targeted for 2027," being the one name in the present tense is the difference between a supply chain and a slide deck.

Behind the Q2 numbers

I try to make this something more than just a company newsletter, but we reported Q2 this fortnight, the numbers are public, and they say something about the market, not just us. Revenue up 498 percent on the same quarter last year, and the business turned from burning cash to making it. One caveat I'll flag myself: the headline $182m net income is mostly a non-cash accounting gain on our convertibles – real under the rules, but not money through the door. The operating number is the one that counts, and it's finally real.

None of it came from Sangdong. Through the end of June the mine was still commissioning – it's only been fully operational since July 1, after the quarter closed. So every dollar of that 498 percent came from existing operations at record prices.

What I'm reading

Tungsten leads critical mineral price gains

In the last edition I said tungsten wasn't like the other critical minerals we all get lumped in with. Here's the chart that proves it. Visual Capitalist ranked 27 of them by price move, using IEA data, and tungsten came out on top at 622 percent – more than three times the next metal on the list.

Scale is the easy story to sell

Two of the world's biggest drug companies, AstraZeneca and Bristol Myers Squibb, reportedly talked about merging into one giant. The deal itself is normal enough. The reaction is the interesting part: AstraZeneca's shares fell on the news. Investors looked at two big companies becoming one bigger company and asked the question the press release never does: what does the combined firm do well that neither could do alone? More revenue, more staff, more assets – none of that answers it. It just adds up to size. The Guardian has the story.

The AI boom sees a wobble

Almost every advanced chip in the world is made using machines from one Dutch company, ASML – nobody else could build them. Last week China reportedly built its own, breaking the monopoly. Markets panicked: chip shares fell worldwide, South Korea's main index dropped 11.5 percent in a day, and Nvidia fell more than five percent and lost its place as the world's biggest company to Apple. Sound familiar? It's the concentration problem I keep going on about with tungsten – too much of something critical in one country's hands, and everyone downstream exposed when that grip looks like slipping. Read more here.

Opinion

Ask a room of investors why tungsten matters now and you'll hear one word: defense. Rearmament, drones, munitions, the bunker-buster headlines. It's the stock answer. It's also nowhere near the whole story.

Around 60 percent of US tungsten goes into cemented carbides – cutting tools, drill bits, the wear parts that chew through rock and steel. That's the US Geological Survey's number. Globally it runs close to two-thirds, a figure S&P Global's recent market report puts in the same range. Defense and semiconductors matter – they're why governments suddenly care – but by volume they're the smaller part.

Defense demand is political. It moves with budgets and elections and it can stall the moment the headlines do. Industrial demand doesn't work that way. As Michael notes above, when tool prices rise the buyers don't stop – nobody halts a car plant because the cutting tools got more expensive.

So watch the geopolitics, but don't mistake the loudest demand for the largest. The metal is going into the most ordinary work imaginable, and that's why it isn't getting cheaper.

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Related Reads: 

Whether the chokepoint is tungsten, germanium, or other critical materials, China's tightening grip on supply has brought our decoupling theme into sharp focus. 

As Western governments accelerate efforts to reduce their dependence on Beijing, companies that control scalable, non-Chinese sources of critical minerals, processing capacity, and secure supply agreements are well positioned to become dominant players in the emerging industrial order.

Assets once thought of as just conventional mining operations are quickly becoming essential ex-China supply channels capable of bypassing Beijing and supporting Western defense, semiconductor, and advanced-manufacturing demand.

 Almonty vs. Tungsten Prices 

Yet, as Almonty Industries CEO Lewis Black emphasized above, tungsten is not solely a defense metal. It is also a critical input for the infrastructure powering the AI boom. Wall Street has yet to realize this fully - but they will. 

Tyler Durden Sun, 08/23/2026 - 19:50

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