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SK Hynix ADRs Priced At 3% Premium As Wall Street Readies Wave Of Leveraged ETFs

SK Hynix ADRs Priced At 3% Premium As Wall Street Readies Wave Of Leveraged ETFs

The next test of the AI trade arrives today, as South Korean memory-chip maker SK Hynix's American depositary receipts begin trading under the temporary ticker SKHYV.

Shares were priced at about a 3% premium to Thursday's close of its ordinary shares in South Korea. The $26.5 billion offering attracted demand for roughly seven times the shares available, forcing the chipmaker to scale back allocations to major investors, according to Bloomberg.

The company sold 177.9 million ADRs at $149 each, raising $26.5 billion, surpassing Alibaba's US debut to become the third-largest listing in history. Each ADR represents one-tenth of a Seoul-listed common share, giving US investors direct exposure to the world's leading supplier of high-bandwidth memory amid the AI boom that could soon unlock the Physical AI boom.

According to the report, Baillie Gifford, Coatue Management, and Situational Awareness Partners received about $5 billion of ADRs, roughly $2 billion less than indicated. Over 500 institutional investors placed orders, including long-only funds, technology specialists, and sovereign wealth funds. The allocation remained concentrated, with 10 investors taking half the deal and the top 25 accounting for about two-thirds.

Wall Street analysts weighed in with their first takes of the deal, courtesy of Bloomberg:

Jung In Yun, CEO at Fibonacci Asset Management

  • "I take 3% premium as a constructive signal. It shows that global investors are still willing to pay up for direct US access despite the recent volatility in Korean equities"
  • From the company's and banks' perspective, the level looks sensible; it is strong enough to demonstrate demand, but not so aggressive that it creates unnecessary aftermarket risk
  • In the current market, a clean, stable debut matters more than squeezing out the last few percentage points of valuation

Sanghyun Park, founder of Clepsydra Capital

  • It shows global funds accept paying up to bypass local index and currency friction and direct exposure to the company's HBM dominance
  • The banks capitalized on the limit to conversion that prevents arb traders from instantly erasing the spread on the first trading day
  • This avoids the typical Korea Discount seen with legacy local names and points toward a TSMC-style scarcity model
  • "Since 3% is just the primary floor and the float is so heavily choked, we could easily see the premium gap much higher once US trading opens on Friday"

Travis Lundy, an independent special situations analyst who publishes on Smartkarma

  • "To me that is not that much of a premium. Eminently reasonable given the current swap rates on owning SK Hynix" local shares
  • The 3% premium to Thursday's close is actually a discounted price to Wednesday's close and every other close for the past few weeks when investor demand was "multiple times" the offering size
  • There is an interesting dynamic whereby if the headroom expands, it will take pressure off the banks to fund local into swaps, which should reduce the swap rate, which should in turn reduce the ADR premium slightly

Dilin Wu, a strategist at Pepperstone Group

  • "The 3% premium tells you the roadshow demand was strong enough to price above Thursday's Korean close — and that's the first concrete evidence that the accessibility premium is real"
  • The real test will be the first two weeks of trading before upcoming earnings; if the ADR consistently trades above the Korean share dollar equivalent, it confirms US investors are willing to pay a premium for accessibility — and that should pull the Korean shares higher
  • The ADRs could be included in the Nasdaq 100 in December; once that inclusion happens, passive fund inflows from vehicles like the Invesco QQQ become a mechanical buying force

Francis Oh, head of Asia business development at Rex Financial, which provides exchange-traded products

  • "The current 3% premium should not be over-interpreted at this early stage"
  • "TSMC's 18% premium reflects structural friction that accumulated over years, not a level established immediately post-listing; any meaningful convergence or divergence for SKHY toward comparable levels is more likely to unfold as a gradual"

SK Hynix's ADR offering comes weeks after SpaceX tapped the public markets in the largest initial public offering in history, while Alphabet is raising $85 billion to fund its AI buildout. Traders are betting heavily that AI-related demand is a secular growth story for memory stocks, which have historically been viewed as more cyclical.

Bloomberg expects that the US debut of SK Hynix will unlock a new "wave of leverage ETFs" tied to the chipmaker's American depositary receipts. It expects ProShares, Leverage Shares and Rex Shares are some of the fism planning to products taht offer 2x daily returns on the memory chip giant.

Bloomberg Intelligence noted:

A fresh pool of leveraged US-listed ETPs would mean the daily rebalancing flows would grow larger, potentially fueling already heightened volatility. The size of the leveraged products also made it difficult to meet the promise of delivering twice daily returns, creating a tracking gap.

The key question is whether SK Hynix's blockbuster ADR offering can juice memory stocks again, especially after our note earlier this week, "South Korea Falls Into Bear Market As Memory Euphoria Fizzles."

Tyler Durden Fri, 07/10/2026 - 08:25

Futures Flat As Traders Brace For Weekend Iran Escalation

Futures Flat As Traders Brace For Weekend Iran Escalation

US equity futures are flat on the final trading session of the week, with Tech lagging, as traders hold off on big bets ahead of the weekend, with the fragile truce in the Middle East keeping geopolitical risk front of mind. Overnight, the US said Iran talks will continue, a positive step amid the recent escalation near the Strait of Hormuz (then again the market never reacted negatively to the latest strikes in the first place). As of 7:45am ET, S&P futures are flat and Nasdaq futures are down 0.2%; pre-market, Mag 7 stocks are mixed: META +1.8%, MSFT +0.9%, while NVDA and AAPL are down 0.6% and 0.4%, respectively. Notably, META has been outperforming since the announcement of its Muse Spark AI model and its strategy for the cloud business. SemiAnalysis, whose "unbiased", often wrong but never in doubt, views at some point be investigated by a regulator, also struck a positive note on META’s AI development (here). Bond yields are 1–2 bp lower, and USD is mostly unchanged. Commodities are mixed: WTI is down 0.2%; base metals are higher, while precious metals are mostly lower. The US economic data calendar empty for the session. Next week includes June CPI, PPI data. Fed calendar empty for the session. 

In premarket trading, Magnificent 7 stocks are mixed with Meta rising 3% after research firm SemiAnalysis posted a positive report on the social media giant’s AI compute business (Microsoft +0.4%, Amazon unchanged, Alphabet +0.1%, Apple -0.4%, Tesla unchanged, Nvidia -0.4%).

  • CCC Intelligent Solutions (CCC) jumps 9% after Reuters reports that the insurance software company is exploring a sale.
  • Circle Internet Group (CRCL) gains 13% after the stablecoin issuer received approval from the US Comptroller of the Currency to establish “First National Digital Currency Bank, N.A.,” a national trust bank that will offer digital asset services.
  • Delta Air Lines (DAL) slips 2.8% after the airline posted second quarter results.
  • EquipmentShare.com (EQPT) gains 13% after the company announced a $500 million share buyback.
  • Fermi (FRMI ) down -17% after offering $350 million in convertible senior notes
  • Twilio (TWLO) climbs 2% as Stifel upgrades to buy on the company’s potential to capitalize on the current AI cycle.
  • WD-40 (WDFC) rises 14% after the lubricant spray maker boosted its net sales forecast for the full year.

In other AI news, JPMorgan has built an array of AI-powered investing agents that beat 60/40 portfolio in back-tests. OpenAI and Google confirmed they have been supplying AI services to Singapore-based subsidiaries of Alibaba, Baidu and Tencent, the Financial Times reports. Netflix is said to be considering steps to deal with signs of declining subscriber engagement, according to the WSJ.  Bayer sold a minority stake in its contraceptives business to Apollo for €3 billion ($3.4 billion) and will use the funds raised to help cover its ballooning litigation costs tied to the herbicide Roundup. Polymarket is seeking regulatory approval to offer margin trading in the US, which would let users bet on events with less capital upfront.

We end a week characterized by thematic rotations, signs of a summer trading lull and low volatility at the index level. Brent crude traded near $76.50 a barrel, swinging between small gains and losses after a volatile stretch. Talks between the US and Iran are continuing despite days of fighting that drove a steep drop in traffic through the Strait of Hormuz. The risk of further escalation is expected to keep investors cautious as they close out the week.

“Over the weekend, discussions between the US and Iran are expected to continue,” said David Manso, chief investment officer at CaixaBank AM. “Oil prices could provide a useful gauge of investor sentiment and expectations regarding the evolution of the situation.”

Yet away from geopolitics, things are about to get busier soon, with Tuesday’s blitz of five major US bank results heralding the start of the earnings season. And speaking of rotation, Lilian Chovin at Coutts in London, notes that the firm has moved a bit underweight US equities. “Other regions are probably better placed right now to navigate the coming few months. Obviously by reducing our US exposure, we have reduced our exposure to tech mega cap.”  The Coutts team remains positive on the AI theme, he explains. “It’s more nuanced than people selling tech to go into defensive sectors. We’ve seen a rotation within tech, caused by some noise around semiconductors.” 

After an unprecedented rally in chipmakers and other AI buildout stocks helped markets shrug off higher oil prices and elevated bond yields, the bar is now high for companies to justify their lofty valuations. For hyperscalers, the onus is on proving that the spending can generate strong returns.

“What remains to be confirmed is whether growth can hold up despite that pressure, with the AI capex cycle continuing to support investment, revenues and earnings,” said Florian Ielpo, head of macro at Lombard Odier Investment Managers. “Expectations are high, but the real test is whether earnings can keep validating the expansion story.”

This morning another company capitalized on the chip bubble when SK Hynix raised $26.5 billion in its ADR offering, the largest ever US first-time share sale by a foreign company. The company sold 177.9 million ADRs for $149 apiece, each equivalent to a 10th of a Seoul-traded common share. Hynix’s US debut is set to spur a wave of leveraged ETF product launches. 

Analysts have upgraded S&P 500 earnings estimates ahead of the second-quarter reporting season, setting the bar high in “an atypical move,” according to HSBC strategists. The Street now expect profits to rise 22% from a year earlier, the highest in the post-pandemic period. Meanwhile, with Q2 reports due shortly, an interesting set-up is emerging between earnings season expectations and headline risk, notes Bloomberg’s equity derivatives specialist Christian Dass. Persistently low implied correlation leaves the VIX vulnerable to a sharp repricing if markets become increasingly driven by macro headlines rather than stock specific fundamentals.

In politics, Trump fired two Democratic members of the US Election Assistance Commission, while the Republican member resigned. Graham Platner’s exit from the Maine Senate race has set off a scramble to find a replacement to take on Republican incumbent Senator Susan Collins, with at least six Democrats entering the field.

In other assets, carry trades are seeing the most compelling backdrop in more than two decades, according to Goldman Sachs, while an unprecedented divergence in the oil-market crack spread gauge are prompting Vanguard to buy insurance against stickier-than-expected US inflation. 

Trade during the European session has been indecisive and non-committal alongside a particularly slow news cycle. The Stoxx 600 has oscillated around the unchanged mark: tech and energy sectors are the worst performers, while telecoms and miners are the biggest gainers. Here are some of the biggest movers on Friday:

  • EasyJet shares jump as much as 15% after the budget airline received a fresh bid from private equity firm Apollo that beats a rival proposal from Castlelake. The shares remain below both offer prices.
  • Vodafone shares soar as much as 14% after its biggest shareholder Emirates Telecommunications Group agreed to sell its entire 16% stake in the firm to a vehicle controlled by billionaire Xavier Niel.
  • Voestalpine, Salzgitter and ArcelorMittal rose after JPMorgan upgraded the steel producers. The bank says it expects 2Q reporting to focus on the impact of cuts to EU steel imports and import tariffs effective from July, which have the potential to transfer demand to EU steel producers.
  • EMS-Chemie shares gain as much as 3.5% after it reported better-than-expected first-half sales and profit and raised its net sales forecast for the year.
  • Hays shares rise as much as 13% after the recruitment company reported stronger-than-expected fourth-quarter fees and forecast full 2026 profit to be at top end of the consensus range.
  • St James’s Place shares fall as much as 7% after Financial News reported that one of the wealth manager’s largest advice firms has decided to exit the group, spotlighting ongoing retention troubles.
  • Duerr shares fall as much as 4% as Berenberg downgrades the German stock to hold from buy and slashes its price target almost in half, citing dependency to automotive original equipment manufacturers.
  • Glenveagh Properties drops as much as 5.1% after being downgraded at Deutsche Bank, as analysts believe the Irish housebuilder is fairly valued following recent gains.
  • Troax shares fall as much as 6.6% after Berenberg downgraded the Swedish maker of machinery parts and warehouse fittings to hold from buy, citing a tough automotive end-market and the likelihood of a slow margin recovery.

The mood in Asia was more upbeat with the MSCI APAC index up 0.8%, boosted by a rally in tech shares. Asian stocks climbed, boosted by a rally in tech shares amid optimism ahead of the US listing by South Korean chipmaker SK Hynix. The MSCI Asia Pacific Index jumped as much as 1.7%, the most in a week. Shares of Samsung Electronics and SK Hynix were the top contributors to the benchmark’s advance and led a 5% surge in the Kospi. Japan’s Nikkei 225 was up almost 2%. SK Hynix raised $26.5 billion in its American depositary receipt offering, powering through recent volatility in global semiconductor stocks. Meanwhile, Samsung Electronics’ Executive Chairman Jay Lee is seeking to meet with Nvidia’s Jensen Huang in the US late July to discuss the former’s investment plans in South Korea’s southwest area, according to a media report. Elsewhere, trading in Taiwan was halted as a strong typhoon approached the island. Japan called on its pension funds, which include one of the world’s largest, to invest in domestic assets. Here Are the Most Notable Movers

  • Shares of Japanese wafer maker Sumco rallied as much as 15% to hit their upper daily limit after Micron’s plan to invest in Taiwan’s GlobalWafers was seen as a sign of rising demand in the sector.
  • Lenovo’ shares rise as much as 9.2% after Morgan Stanley upgrades the Chinese device maker and more than doubles the price target, citing its ability to pass through higher component costs amid AI-driven demand.
  • Zhipu shares drop as much as 9.7% in Hong Kong, paring a sharp three-day rally, after Goldman initiated coverage at neutral, saying their valuation fairly reflects the competitiveness of the company’s AI models.
  • Mitsubishi Motors shares climbed as much as 17%, the most since December 2024, after the vehicle maker announced a tie-up to produce humanoid robots with a Tokyo-based startup.
  • Fast Retailing shares slipped as much as 3.7%, the most since May 12, after the Uniqlo owner’s 3Q earnings beat was seen as priced in

In FX, the dollar dipped 0.1% in a third straight day of losses. Bonds extended a rebound, with the yield on 10-year Treasuries falling two basis point to 4.54%. The yen outperformed major currencies, rising 0.4% after Japanese Finance Minister Satsuki Katayama said the government wants pension funds to increase investment in domestic assets.

In rates, treasuries are slightly richer across the curve following similar price action across European bonds with oil prices steady. US yields are 1bp-2bp lower with curve spreads within a basis point of Thursday’s close, 10-year near 4.535% with bunds and gilts in the sector also about 1.5bp richer on the day. During Asia session, yen and JGBs advanced after Japan’s Finance Minister Satsuki Katayama called on pension funds, including the GPIF, to invest in domestic assets. Long-end JGB yields ended more than 10bp lower. US session has no major scheduled events.  IG dollar issuance slate empty so far. Four borrowers priced $2.25b in new US investment-grade bonds Thursday, pushing weekly volume through $51b and more than double forecasts. Issuers paid about 2bps in new issue concessions on deals that were 4.2 times covered.

In commodities, Brent crude futures are down 0.5% and around the $76/bbl mark with traders awaiting further directional clues from events in the Middle East. WTI crude oil futures little changed as US and Iran continue talks despite a flare-up in fighting. Precious metals are on the back foot with spot gold and silver down 0.6% and 0.8% respectively. Bitcoin is higher by 1.5%. 

The US economic data calendar empty for the session. Next week includes June CPI, PPI data. Fed calendar empty for the session. Next week Federal Reserve Chairman Warsh testifies before the House Financial Services and Senate Banking Committees on its Semi-Annual Monetary Policy Report.

Market Snapshot

Top Overnight News

US-Iran negotiations on a permanent peace deal are continuing, according to an American official, despite two days of clashes that threatened to unravel the ceasefire. BBG

Israel shared new intelligence with the U.S. that it said indicated a fresh Iranian plan to kill President Trump, people familiar with the matter said, a finding that would mark an escalation in the war between Washington and Iran. This news that comes just 24 hours after Trump unexpectedly switched back to the old Air Force One for his return flight from the NATO summit in Turkey as a “security precaution” (the New Air Force One doesn’t have the same security features as the old one). Iran for years has vowed openly to retaliate against Trump for the assassination of Qassem Soleimani, who was a top general in the Islamic Revolutionary Guard Corps, in the president’s first term. WSJ 

The UAE boosted crude production to an all-time high last month, pumping 4.1 million b/d on average in June. IEA 

Global diesel market faces a significant supply crunch as Russia bans exports due to domestic shortages following Ukraine strikes. FT

Japan’s Finance Minister, Satsuki Katayama, sparked a jump in the yen on Friday when she said the government would pursue policies to encourage pension funds to buy more Japanese assets. Japan’s biggest public pension fund will likely ignore the call to boost domestic investment, at least in the short run, because of strict rules governing asset allocation and its public mandate. BBG

Japan’s producer prices picked up in June to the fastest pace since early 2023, reinforcing the case for the BOJ to keep hiking rates. BBG

Taiwan halted trading on its stock exchange and closed schools as Typhoon Bavi approached the island. TSMC postponed its monthly sales disclosure to Monday. BBG

South African economic growth is on an upswing as efforts to improve governance and critical infrastructure are lifting bottlenecks that have held it back for years, according to Standard Bank’s chief economist. BBG

SemiAnalysis thinks Meta should be talked about alongside OpenAI and Anthropic as the top three frontier AI labs in the world (of the hyperscalers, SemiAnalysis thinks Meta, not Google, has the best chance of catching up with Anthropic and OpenAI). SemiAnalysis, which may or may not have a conflict of interest

Trump fired two Democratic members of the US Election Assistance Commission, while the Republican member resigned.

Graham Platner’s exit from the Maine Senate race has set off a scramble to find a replacement to take on Republican incumbent Senator Susan Collins, with at least six Democrats entering the field: BBG

A more detailed look at global markets courtesy of Newsqauwk

Asia-Pac stocks traded entirely in the green, as they followed the tech-led gains seen stateside. Military strikes continued on Thursday, but energy prices and equity markets seemed to have brushed it aside and instead took a stronger liking to President Trump’s comments, in which he said Iran had reached out to the US and wanted to make a deal, easing concerns over a further escalation that could threaten energy infrastructure. To note, the Taiwan markets were closed due to the typhoon, and worries of the typhoon hitting China and Japan. ASX 200 initially opened with modest losses but has since reversed and printed modest gains. Metals & Mining topped the sector pile, cutting 4 consecutive days of losses, while Health Care was the sector laggard. Nikkei 225 gained, with SUMCO leading the way as it benefited from the semiconductor strength stateside. On the earnings front, Seven & I and Fast Retailing both posted strong earnings and raised their FY guidance; however, shares traded lower after highlighting the effects of a weaker yen. KOSPI surged, helped by gains in Samsung Electronics while SK Hynix shares traded choppy ahead of its US ADR listing. The choppiness in SK Hynix comes as investors position themselves for the ADR, with analysts stating that the US ADR may be preferred over its domestic listing, due to US ADRs commonly trading at a premium (typically at a 5-15% premium). Shanghai Comp. and Hang Seng were firmer, with another set of IPOs in Hong Kong, resulting in 15 listings this week. Today, markets were focused on Nexchip Semiconductor. The IPO price was set at HKD 32.30/shr, and shares rose at the open and briefly topped HKD 36/shr but have since come off.

Top Asian News

  • Japanese Finance Minister Katayama said they are to pursue steps to promote investment in Japanese assets by GPIF and others.
  • Japanese Finance Minister Katayama does not comment on specific bond yield levels; specific monetary tools are up to the BoJ, closely monitoring economic indicators and market situations. Important that the government position secures market confidence. Will ensure fiscal sustainability to gain market trust. BoJ can adjust monetary policy regardless of what the government said. Predicts gradual increases in interest rates as the government is engaged in a proactive fiscal policy. Want to speed up discussions on expansion of JGB products targeting households.
  • Japan's GPIF spokesperson said they are aware of Finance Minister Katayama's comments but declines to comment.
  • Japan's Economy Minister Kiuchi said the government has consistently communicated its stance of taking policy that heeds to fiscal sustainability.

European bourses (STOXX 600 -0.1%) began the session on a weaker footing despite APAC optimism ahead of SK Hynix’s US debut (KOSPI +2.5% at close). Geopolitical newsflow quietened overnight, as such energy benchmarks are off best levels with Brent around USD 75/bbl. IBEX continues to outperform after it slumped earlier in the week (also has more defensive composition), while tech heavy AEX is the worst performer as top constituent ASML looks to SK’s ADR debut. European sectors opened with a positive bias and continue this way. Comms and Travel/Leisure outperform, Tech and Energy are the laggards for the above factors. In terms of individual movers, Infineon (-2.7%) said it is raising prices in some segments; EasyJet (+14%) agreed to a GBP 5.7bln takeover by Apollo at 715p/shr; Vodafone (+11%) French telecom tycoon Niel acquired E&’s stake for a GBP 0.15/shr premium.

Top European News

  • UK Chancellor Reeves is to announce a new City "skills compact" that will commit financial firms to retraining thousands of workers for the AI revolution, The Guardian reported.

FX

  • G10s are mixed against the Buck. JPY leads after FinMin Katayama touted measures to promote domestic inflows, Kiwi continues to eek gains post-RBNZ as markets look to price a cumulative 50bps tightening by year end and NOK is the worst performer after broadly cool inflation data.
  • USD a touch weaker as JPY firms alongside the tempered recent Gulf updates. Geopolitical newsflow quietened overnight, with energy benchmarks off best levels with Brent around USD 75/bbl, about 5 Bucks off the week’s highs. DXY slipped throughout APAC as the JPY firmed, but found buyers below 21DMA at 100.85 which has proven support in recent sessions.
  • JPY digests updates from FinMin Katayama who said she was to pursue steps to promote investment in Japanese assets by GPIF and others. This, on the face of it, would be a textbook tactic to encourage domestic investment and passively limit outflows, especially with a large composition (50%) of pension funds allocated to foreign investments. Several strategists note this is a positive sign in attempts to shore up the currency; though CapEco said “Much of its domestic bond portfolio is invested passively, and shifting more assets into domestic bonds would come at a sizeable fiscal cost if it requires selling equities”, and others highlight Katayama is not in a position to direct changes, it would be under the jurisdiction of the Labour Ministry. USD/JPY gradually trundled lower from a 162.50 peak, to mark a trough below 161.30 (session low 161.28), with a modest kneejerk lower on not-too-surprising BoJ sources. ING notes the JPY-funded carry keeps risks to the upside for the pair.
  • NOK is the clear underperformer vs. both the USD and SEK after the soft inflation data series. Most metrics cooled beneath expectations, core Y/Y the sole figure rising above consensus, albeit unch. from May. CPI-ATE, the Norges Bank’s preferred gauge of inflation fell was 2.9%, well below the Bank’s estimate of 3.3%, will likely provide conviction for doves with the bank likely to remain on hold in the August meeting; then tighten in September should the next (August) CPI metrics not provide a dovish surprise. NOK/SEK fell from a 0.9940 peak to mark a trough at 0.9882. 8th July low at 0.9861 is the next level below.
  • South Korean Forex Authority said USD/KRW market remains misaligned with economic fundamentals.

Fixed Income

  • Overall, fixed benchmarks are firmer in reaction to the modest but increasing pullback seen in the energy space overnight and as JGBs lead on domestic updates.
  • JGBs got to a high of 127.76 in the European morning, continuing the overnight rally after comments from Japanese Finance Minister Katayama, who said that pension funds should be encouraged to invest more in the domestic market. Commentary that underpinned Japanese assets across the board, and sent the 10yr yield lower by around 16bps on the day, down to 2.71% and now essentially flat on the month, reversing from the 2.89% YTD high.
  • Commentary that also lifted peers at the time. While the shift would be a positive for the Japanese market generally, there are a few unknowns, most pertinently being whether Katayama can make such an announcement as the GPIF is under the Labour Ministry, not the Finance Ministry. As such, for FX in particular, there is an argument that Katayama’s commentary is conducting another form of jawboning, and therefore the move may well fade in the days/weeks ahead, unless a relevant official to the GPIF (i.e. Ueno, or PM Takaichi) backs the shift publicly.
  • USTs got to a 109-12 peak in the early morning, as energy hit a low and the JGB-driven move topped out. Since, newsflow has been particularly light with the market essentially waiting for a resumption of negotiations or strikes, though as is often the case we might not get clarity on the next step until the weekend.
  • Bunds followed suit, peaking at 125.74 with gains of around 35 ticks. Specifics limited. Continued focus on the EU funding plans, and the lack of agreement on the next 7yr plan is arguably supporting EGBs for net-contributing nations, as no agreement would see the current EUR 1.4tln figure continue as opposed to the planned uplift to EUR 2tln.
  • Gilts opened lower by a few ticks, before then swiftly moving above the 88.00 mark to a 88.07 peak, in-fitting with the above. Action that leaves it just above Wednesday’s high but someway shy of the 88.93 opening level at the start of the week. Last night the first tally was done for the Labour nominations, and while the count theoretically leaves space for a challenger it is not realistic and therefore Burnham is now formally, for all intents and purposes, the incoming UK PM.
  • Italy sold EUR 7.5bln vs exp. 6.0-7.5bln 3.00% 2029, 3.35% 2033 & 3.95% 2041 BTPs.
  • China's MOF sold 2-year and 3-year bonds. 2-year sold at 1.2305%. 3-year sold at 1.2629%.
  • Australia sold AUD 900mln 1.75% 2032 AGBs: b/c 3.16x (prev. 4.10x), average yield 4.6189% (prev. 4.1987%).

Commodities

  • The geopolitical situation appears to have calmed down this morning, with no fresh reports of strikes on Iran/regional neighbours. However, the situation remains tense given some of yesterday’s actions. Iran reported a couple of strikes at two military bases, but US officials denied any involvement of this. Despite the earlier reports, some Iranian officials denied any explosions taking place.
  • Despite the recent flare-up, a US official stated that the US remains committed to a resolution with Iran and technical discussions are ongoing. This, alongside the lack of new strikes overnight has led to a bearish bias in crude benchmarks this morning. Brent Sep’26 (-0.2%) is only mildly lower and trades at the towards the mid-point of a USD 75.36-76.95/bbl range. Some mild downticks were seen in the benchmark after the release of the IEA Oil Market Report. It cut 2026 oil demand, noted that the UAE is upping its supply and oil transits are passing through the Hormuz.
  • Spot gold (-0.6%) trades lower this morning, hovering on either side of the USD 4.1k/oz mark; currently within a USD 4,094-4,134/oz band. The range today is very thin, amidst the lack of pertinent newsflow and fairly steady USD. Elsewhere, base metals hold a negative bias. 3M LME Copper trades within a USD 13,455-13,562/t range. For aluminium, analysts at Morgan Stanley recently stated that they see a smaller supply deficit in 2026, and likely to move into a surplus from 2027.
  • Oman has set its OSP at USD 69.29/bbl for September delivery.
  • IEA OMR: forecasts global oil demand in 2026 to fall by 1.05mln BPD (prev. exp. 1.12mln); global oil demand recovery is under way. Global oil demand estimated at 103.46mln bpd for 2026 and is expected to grow by 2mln BPD in 2027 and reach 105.47mln BPD. Oil supply may expand 7.5mln BPD in 2027 if transits improve.
  • A fire broke out at two oil product storage facilities due to a UAV attack in the Rostov region, according to the governor; fires are being pushed out in Taganrog's Seaport, reported no injuries.
  • Krasnodar task force said a fire has broken out at the Ilsky oil refinery due to the fall of a drone's debris, Interfax reported.
  • QatarEnergy set August Marine Crude OSP at Oman/Dubai -USD 5/bbl; Land Crude OSP at -USD 4.50/bbl, according to a pricing document.
  • China National Summer grain output reached 150.7mln tonnes, +0.7% Y/Y.

Trade/Tariffs

  • China's MOFCOM announces a temporary ban on helium exports.
  • US White House announces the adjustment of imports of commercial aircraft, jet engines, and aircraft and engine parts into the US; no immediate tariffs be imposed under section 232 to address the threatened impairment to the national security.

Central Banks

  • BoJ reportedly to keep rates unchanged in July but maintain policy guidance and also raise growth outlook, according to sources.
  • PBoC injected CNY 20bln via 7-day reverse repos with rate maintained at 1.40%.
  • PBoC set USD/CNY mid-point at 6.7989 vs exp. 6.7931 (prev. 6.8036); strongest midpoint since February 2023.
  • NBP's Wnorowski said signal about possible motion to cut interest rates in September is premature; do not see space for more than one cut this year.

Geopolitics: Middle-East

  • Qatar, Pakistan and other regional mediators are trying to de-escalate tensions between the US and Iran and revive negotiations on a nuclear deal, Axios reported citing sources.
  • A member of the National Security Commission of Iran's parliament said the UAE will pay the price for cooperating with America.
  • A US official said talks with Iran will continue, Fox's Hasnie reported; The administration is still committed to finding a resolution so technical talks continue to prevent Iran from having a nuclear weapon. Iran's attacks on ships in the streets are acts of terrorism. The MoU is performance-based, and Iran's actions constitute failed performance at an unacceptable level.
  • Israel reportedly shared new intelligence with the US that indicated a new Iranian plan to kill US President Trump, WSJ reported citing sources.
  • A US official said the US remains committed to a resolution with Iran and technical discussions are ongoing.
  • Turkey has decided it will not join the Canadian Defence Bank initiative at this point, sources suggest.
  • The Israeli army said "we will continue our operations to eliminate any threat and will not allow Hezbollah to harm us", Al Jazeera reported.
  • Al Jazeera reported that Israeli forces are conducting extensive demolitions in southern Lebanon.
  • Krasnodar task force said a fire has broken out at the Ilsky oil refinery due to the fall of a drone's debris, Interfax reported.
  • Pakistan has begun mediating between Libya's rival eastern and western data centres with the backing of the US and Saudi Arabia, Nikkei reported citing sources.
  • Lebanese media reported of new Israeli drone strikes in southern Lebanon, Tasnim reported.
  • Four Japanese-linked vessels remain in the Persian Gulf, Kyodo reported.
  • Konarak Governor said this area was targeted by enemy fighter jets in two stages on Thursday evening.

Geopolitics: Ukraine

  • Ilsky (138k BPD), Russia oil refinery fire has now been extinguished.

US Event Calenadar

  • The US economic data calendar empty for the session

DB's Jim Reid concludes the overnight wrap

I was hoping that by now the latest on the Iranian conflict wouldn’t be the lead story but it has of course returned to the top of the headlines this week. The latest is that Bloomberg reports overnight indicate that “technical talks” continue between US and Iranian officials despite the clashes this week. There were also Bloomberg reports that President Trump and PM Netanyahu spoke Thursday according to the PM’s office. To be fair sentiment turned back more positively late Wednesday night when Trump suggested that the Iranians were desperate for a deal. So markets have generally been more positive since.

So for now we can go back to trying to guess whether we’ll wake up to the KOSPI being up or down more than 5%. If you guessed in the positive side this morning you’d be correct as it’s surging +5.11% as I type, after officially entering bear-market territory yesterday. The rally has of course been driven by strong gains in semiconductor stocks with the record-breaking $26.5 billion listing by chipmaker SK Hynix helping to reinforce confidence that the AI investment cycle remains intact. Elsewhere in the region, Hong Kong’s Hang Seng Index (+1.85%) has climbed to its highest level since June 17, while Japan’s Nikkei 225 (+1.77%) is also posting strong gains. The CSI 300 (+0.49%), Shanghai Composite (+0.75%), and S&P/ASX 200 (+0.51%) are also up. US and European futures are down between a tenth and two tenths of a percent though. 10yr USTs are -1.2bps lower trading at 4.54% and oil is fairly flat.  

In Japan, long-dated government bond yields are falling and the yen strengthening after Finance Minister Satsuki Katayama indicated that the government intends to encourage pension funds, including the Government Pension Investment Fund (GPIF), to increase allocations to domestic financial assets. The 20-year JGB yield is down -7.8bps at 3.78%, while the 10-year is -8.7bps lower at 2.778%. The Japanese yen (+0.51%) is rallying for a second consecutive session, trading at 161.54 against dollar as we go to print. There is some scepticism here internally as to whether it'll be easy to encourage domestic pension funds to automatically buy more JGBs. The view is that asset allocations decisions are more slow moving and might actually favour equities first. However for now the move is being seen as a sign that action is being considered.  

Ahead of all that, markets saw a bit of a relief rally yesterday, thanks to easing geopolitical fears, decent tech headlines, and a respectable batch of data. So collectively, that helped to power bonds and equities on both sides of the Atlantic, particularly as falling oil prices reassured concerns about a fresh surge of inflation. So by the close, that meant the S&P 500 (+0.81%) and Europe’s STOXX 600 (+0.78%) both advanced, whilst yields on 10yr Treasuries (-4.2bps) and bunds (-0.8bps) also fell back.  

Those oil price declines followed headlines suggesting that the escalation between the US and Iran might not prove as serious as initially feared. Most notably, sentiment was supported by comments from President Trump late on Wednesday night, that we mentioned yesterday, saying that Iran wanted “to make a deal so badly”. So when US and European markets reopened yesterday, they were buoyed by the fact that Trump was still talking about some kind of agreement. So that supported oil prices lower, with Brent crude down -2.20% on the day to $76.30/bbl. And in turn, that eased fears around inflation, with the 1yr Euro inflation swap (-9.0bps) falling to 2.05%, after rising 27bps on Wednesday.

This backdrop meant that investors dialled back their expectations for imminent rate hikes again, particularly in Europe. For instance, the amount of ECB rate hikes priced by December came down -8.5bps on the day to 31bps. And over at the Fed, the probability of a hike at the upcoming July meeting fell back from 31% to 24%. So that provided a decent tailwind for sovereign bonds in turn, with yields on 10yr bunds (-0.8bps), OATs (-7.2bps) and BTPs (-7.0bps) all coming down.

Whilst lower oil prices helped sentiment, markets got another boost yesterday from the latest tech headlines, which saw the Philly semiconductor index (+3.06%) post its best daily performance in 3 weeks. That included a very strong gain for Micron (+4.52%), who raised their planned spending on new US plants to $250bn by 2035, which was $50bn on top of previously announced commitments. The rally also saw the SK Hynix ADR officially became the largest foreign company offering as the South Korean chipmaker raised $26.5bn – greater than expected and just ahead of the $25bn previously raised by Alibaba.

So that chip rally helped to lift US equities more broadly, with the S&P 500 (+0.81%) recovering after back-to-back declines on Tuesday and Wednesday. The rally was fueled by investors rotating from defensives industries back into growth and cyclical names. Autos (+2.91%), Tech Hardware (+1.99%), Semis, +(1.90%), and Banks (+1.61%) were the best performing S&P 500 industry groups, while Consumer Staples (-2.04%), Food & Bev (-1.77%), and Household Products (-1.58%) lagged. And in Europe, the STOXX 600 (+0.78%) advanced for the first time this week with a similar rotation from defensives into cyclicals.

Speaking of tech, there was an interesting acknowledgement of AI-driven inflation from New York Fed President Williams. He spoke about the potential for demand driven by AI to raise inflation, and said if it “creates a sustained impulse to demand relative to supply in inflation, I do think that’s the kind of situation where you don’t look through this”. Meanwhile on inflation more generally, he said that if core PCE were at “two-tenths a month in the second half of this year, that would be consistent with my view of a disinflationary process that’s continuing”. But he also said if it were higher, “ that would be a sign of inflation a bit more persistent.”

The other Fed news from yesterday was the release of the leadership teams of the five task forces that Chair Warsh announced to examine the Fed’s current approach and processes. The areas that the Fed are examining are the communications strategy, the use of the balance sheet, the quality and reliance on existing data sources, productivity and jobs, and inflation framework. The teams are mix of former policy makers, academics, and corporate leaders. 

Staying on central banks, yesterday also brought the minutes of last month’s ECB meeting, where they hiked rates for the first time since 2023. It spoke of inflation pressures, and said how “Further indirect effects were in the pipeline, pointing to more broadening of inflationary pressures across the economy”. Moreover, there was an acknowledgment that “memories of the 2022 high-inflation episode could make households and firms react more quickly than in the past, increasing the risk that price-setting and wage-bargaining behaviour would adjust.” Interestingly, there was also a discussion about what happened in 2011, when the ECB hiked rates before reversing course shortly after as the sovereign debt crisis became more severe. But the view was there were key differences with that period, including the lack of financial stress.

Finally, the latest US data yesterday offered fresh reassurance on the labour market, with the weekly initial jobless claims coming in at 215k in the week ending July 4 (vs. 217k expected). So that took the 4-week moving average down to 218.75k, and so far at least, claims remain well beneath their summer peaks in 2023, 2024 and 2025. However, existing home sales unexpectedly fell in June, falling back to an annualised rate of 4.09m (vs. 4.20m expected).

Looking at the day ahead now, and data releases include Italy’s industrial production for May, and Canada’s employment for June. Otherwise, central bank speakers include the ECB’s Vujcic and Stournaras.

Tyler Durden Fri, 07/10/2026 - 08:07

France Pushes Syria Strategic Energy Corridor Vision Despite Bombing During Macron Visit

France Pushes Syria Strategic Energy Corridor Vision Despite Bombing During Macron Visit

Via The Cradle

French Foreign Minister Jean-Noel Barrot on Thursday said that Paris is developing "alternative routes" following a return to war between the US and Iran, singling out Syria as a primary gateway to Persian Gulf oil.

"Among all the efforts we have made since the start of this crisis, there is the idea of preparing alternative routes so that we are not dependent on blockages here or there," Barrot said.

AFP/Getty Images: French President Emmanuel Macron shakes hands with Syrian President Ahmed al-Sharaa during a visit to the Umayyad Mosque in Damascus on July 6. 

The foreign minister noted that Syria is currently reunifying after the collapse of former Syrian president Bashar al-Assad's government, and could emerge as a "new regional hub." He also identified Syria as a strategic corridor for Gulf oil to mitigate supply disruptions in the Strait of Hormuz.

Barrot emphasized that France intends to expand trade and economic cooperation with Damascus while securing a pathway for Gulf producers.

The transition requires comprehensive infrastructure assessments and security guarantees, the foreign minister said, viewing these efforts as essential to securing global energy markets.

The announcement follows French President Emmanuel Macron's visit to Damascus on Tuesday, where he met with former Al-Qaeda chief and self-appointed Syrian President Ahmad al-Sharaa to discuss regional stability.

Joining Macron on his visit, TotalEnergies head Patrick Pouyanne described the nation as being "at the crossroads of the Middle East," positioning it as a vital transit link between Iraq and the Mediterranean Sea. 

Since April, Iraq has been transporting oil through Syria by truck for re-export, exporting over 600,000 tons of fuel oil between April and June to bypass the closure of the Strait of Hormuz.

Last month, officials from both countries discussed rehabilitating the shared Kirkuk-Baniyas oil pipeline and establishing energy transit mechanisms.

While TotalEnergies has signed a memorandum of understanding (MoU) for an offshore exploration block in the Mediterranean, Pouyanne clarified that no other specific projects are underway. 

He acknowledged that current conditions remain volatile, stating, "Today, it's clear that the security situation still doesn't allow us to operate, but I think it is a positive initiative to come here, to Damascus."

His remarks preceded reports of two bombs detonating near the Four Seasons Hotel where the French delegation stayed. 

Pouyanne noted, "We should give the government time to take control of the country. We shouldn't ask too much," concluding, "We need to be a little patient."

Tyler Durden Fri, 07/10/2026 - 07:20

Germany Inks Deal To Buy US Tomahawks, Filling Long-Range Capability Gap

Germany Inks Deal To Buy US Tomahawks, Filling Long-Range Capability Gap

German Chancellor Friedrich Merz newly announced Thursday that his government has struck a deal with the United States to buy American-made Tomahawk cruise missiles and station them in Germany.

"On the sidelines of the NATO summit in Ankara we also agreed with the American government that Tomahawk missiles would be purchased by us and stationed in Germany," Merz said. "With this we are closing an important strategic gap in our defense. And at the same time we will work on developing our own European systems and deploying them in Europe."

Shutterstock

He announced this while informing parliament that the results of this week's NATO summit in Turkey "exceeded all of my expectations" -  which he said bolstered the alliance as a "united, strong and self-confident" one.

Russia loomed large in the background of his speech, given he offered a final goal of moving toward "a future where our country is not susceptible to blackmail, but rather can confidently meet every threat posed to our free way of life using its own strength."

Germany makes its own cruise missiles, the Taurus, but their range of just over 300 miles is three to five times shorter than the Tomahawk.

With this deal, Berlin is seen as greatly bolstering its long-range strike abilities, at a moment this has also been a big focus in Ukraine, in terms of inflicting damage deep inside Russian territory.

When it comes to actual deep-strike deterrence, Washington has long had the biggest monopoly on long-range capabilities in comparison to European militaries and EU domestic production.

The operational range of a Tomahawk missile varies between about 800 to 1,700 miles, depending on the specific block variant and flight profile.

While the missile is relatively slow compared to more recent developments in missile technology, it is effective as it's able to fly so low, almost at tree line level, thus better evading radar.

"Operational missiles are launched by a solid-fueled booster rocket and carried to their target by a turbofan jet engine," one source reviews.

"The Tomahawk flies near the surface at 550 mph and uses satellite-assisted navigation and TERCOM (Terrain Contour Matching) radar to guide it to a target up to approximately 1,500 miles distant," the source notes. "It can carry either a conventional or a nuclear warhead."

Tyler Durden Fri, 07/10/2026 - 06:55

BP Weighs North Sea Exit Under New CEO

BP Weighs North Sea Exit Under New CEO

Authored by Michael Kern via OilPrice.com,

BP has started to simplify its portfolio and cut costs, and will make fewer but better choices in which projects to invest, chief executive Meg O’Neill said on Thursday.

“We are taking concrete action to grow long-term value for shareholders: simplifying our portfolio, reducing costs, maintaining tight discipline on capex and strengthening the balance sheet,” O’Neill, the first female CEO of a Big Oil company, wrote in a LinkedIn post to reflect on the first 100 days as top executive of BP.

“We need to be deliberate about where we invest and where we don’t. We need to make fewer, better choices and hold ourselves to account,” O’Neill wrote.

“Investors should be able to rely on us in the same way our customers do,” the executive added.

BP has already simplified its structure by bundling operations into two businesses, Upstream and Downstream, with trading connecting both to create value.

Despite the unprecedented disruption in the energy industry in recent months, BP has continued to simplify the company and reduce costs to make the supermajor more attractive to investors, she said.

As part of the portfolio simplification, BP is reportedly considering an exit from the UK North Sea, due to unfavorable taxation policies in Britain.

BP is the last supermajor to haven’t either sold or combined its UK North Sea business in recent years. Shell and Equinor combined their oil and gas assets in a standalone company, Adura.

TotalEnergies merged its assets with NEO NEXT to create NEO NEXT+, in which the French supermajor holds a 47.5% interest.

This week, BP announced a divestiture offshore Canada, as it agreed to sell its non-operated interest in the Bay du Nord offshore oil development to Equinor.

The sale marks another step in BP’s strategy to streamline its upstream portfolio and tighten capital allocation.

Tyler Durden Fri, 07/10/2026 - 06:30

Better Off? How Generational Progress Slowed In The US

Better Off? How Generational Progress Slowed In The US

Bettering yourself financially or at least giving your children the opportunity for a more prosperous future has driven people to emigrate to the United States for generations. But is the next generation still better off in this day and age?

The answer is yes, but not by that much.

At least, as Statista's Katharina Buchholz reports, this is the verdict given in a discussion paper published by the Federal Reserve Board of Washington D.C. in 2024. 

It concludes that millennials' median household income at 36 to 40 years old was still 18 percent higher than that of Generation X at the same age.

A millennial born in 1982 would have turned 40 in 2022, the last year the study looked at.

Better Off? How Generational Progress Slowed in the U.S. | Statista

You will find more infographics at Statista

Gen X achieved a similarly low increase of median household incomes over Baby Boomers at 16 percent.

This is in contrast to the post-war generation, which at age 36-40 earned 27 percent more than the Silent Generation.

For this generation growing up during World War II, the number still stood at 34 percent on average.

Taking as a baseline the Greatest Generation, which was born between 1900 and 1927, the Silent Generation earned 34 percent more, while Boomers made a cumulative 70 percent more, Gen X took home 97 percent more and finally Millennials brought in 133 percent more than the Greatest Generation even when adjusted for inflation.

The data also shows that the Silent Generation worked 14 percent more hours than the generation before and Boomers worked another 14 percent more.

However, working hours have been relatively stable for generations since.

While the numbers show that average income wealth rose in the United States over time and that more people gained access to at least a middle-class life over the decades, this doesn't mean that everybody is necessarily making more than those who came before. 

A study published in 2017 and widely reported then showed that only 50 percent of people born in 1984 made more than their parents at age 30.

For those born in 1940 and turning 30 in 1970, this number had still been above 90 percent.

Tyler Durden Fri, 07/10/2026 - 05:45

The Men Who Own The Ukraine War Now Run It

The Men Who Own The Ukraine War Now Run It

Authored by Thomas S. Karat via AntiWar.com

There was a time when the arms dealer waited in the corridor. He financed the campaign, endowed the think tank, took the general to dinner, and hoped the man inside the office would remember him when the contract came up. The wall between the money and the decision was thin, often corrupt, but it was there. Someone held the public trust, and someone else tried to buy it, and you could at least tell the two apart.

That wall is gone. The financier no longer waits in the corridor. He holds the office. He signs the checks. He is the buyer and the seller, the regulator and the regulated, the public interest and the private portfolio, fused into a single man in a single suit, and the arrangement is entirely legal, which is the whole problem.

Getty Images

One of these men may already be familiar from a previous article. His name is Friedrich Merz.

The chancellor was the warm-up act

From 2016 to 2020, Merz chaired the supervisory board of BlackRock’s German arm, the local office of the largest pool of private capital on earth – a fact confirmed, without embarrassment, by his own party's foundation. Then he climbed back into politics, and in March 2025, as chancellor-in-waiting, he drove through the outgoing Bundestag — deliberately before the newly elected parliament could convene – the constitutional amendment that exempted defense spending from Germany’s debt brake. The borrowing limit Germans had treated as sacred since 2009 was gone. German military spending rose 24 percent in a single year to $114 billion, the largest in NATO Europe, and BlackRock held stakes in the very contractors – Rheinmetall, Hensoldt – that the money would flow toward.

He broke no law. He simply spent four years learning, from the inside, how the machinery paid out, and then went and pulled the lever. The arrangement was a particular kind that no scandal quite captures, because nothing in it is hidden. It sits in plain view, in regulatory filings and procurement requests, and it works precisely because everyone involved can say, truthfully, that they broke no rule.

It reads as a German problem only until you cross the Atlantic. There the same face turns up in an American suit, several of them, installed not adjacent to the war machine but at its controls.

The banker who became the Navy

Consider John Phelan, who until March 2025 had no connection to the military beyond a seat on a charity board. His career was money: he co-founded MSD Capital, the private investment firm that managed the personal fortune of Michael Dell, and later founded his own firm, Rugger Management. He gave Trump’s joint fundraising committee $834,600 in April 2024. Months later he was nominated to run the United States Navy, and in March he was confirmed, handed a $263.5 billion budget and command of nearly a million sailors and Marines.

Before his confirmation, Senator Elizabeth Warren wrote to him about the obvious. He had recently earned over $5 million in capital gains from Palantir, a defense-software contractor that took in $541 million from the Pentagon in fiscal 2024 alone, and whose relationships Phelan’s own acquisition vehicle had once advertised. She asked him to divest his defense holdings and to recuse himself, for four years, from matters touching his former clients and employers, noting that a dozen Biden appointees had voluntarily gone beyond what the ethics laws required. Phelan declined to make the stronger commitment. He was confirmed anyway, 62 to 30, with eleven Democrats joining every Republican in the room.

The man overseeing the Navy’s shipbuilding budget was, weeks earlier, a private investor with money in the companies the Navy buys from. Nobody hid it. It was printed in his disclosures and read aloud at his hearing, and it changed nothing.

The private-equity takeover of the Pentagon

Phelan is the modest case. The full expression of the thing sits one floor up, in the office of the deputy secretary of defense, where Stephen Feinberg runs the day-to-day of the entire department.

Feinberg co-founded Cerberus Capital Management and led it for thirty-three years; in his own sworn testimony to the Senate he put the firm’s portfolio at over $65 billion. He was a major Trump donor, and by the time he was confirmed in March 2025 he was, at a listed minimum net worth of $2 billion, the wealthiest official in the administration. What he has built since is not influence over the Pentagon. It is ownership of its investment arm.

Feinberg has surrounded himself with a circle of advisers drawn from his old firm. The group includes former Cerberus managing director John Gallagher and a deal team led by Cerberus alumnus George Kollitides – who was, until 2015, chairman and chief executive of Remington, the gunmaker Cerberus owned. Industry executives nicknamed the squad “Deal Team Six,” a joke on the SEAL unit that killed bin Laden, and Kollitides told a Milken Institute audience he found the name both fun and fitting while explaining that economic warfare has been a part of all successful nations for thousands of years. A Stanford professor watching this described it plainly: private equity has just acquired its largest organization.

The organization it acquired writes checks the size of nations. Under Feinberg, the Pentagon stopped merely buying weapons and began buying companies. It took a $400 million preferred-equity stake in the rare-earth miner MP Materials, enough to make the United States government the firm’s largest single shareholder at roughly 15 percent – ahead, as it happens, of BlackRock. It put $1 billion into an L3Harris rocket-motor unit slated to go public in 2026. Stakes in Trilogy Metals, Vulcan Elements, and ReElement Technologies followed, a portfolio that a group of House members warned was locking federal policy to the fortunes of individual firms – picking winners, and by definition creating losers.

Whose companies get the contracts

Here is where the fusion stops being abstract... Feinberg signed an ethics agreement before confirmation. He would divest from Cerberus and recuse himself from matters involving the firm. But the fine print left the door open: he could transfer his Cerberus holdings into trusts benefiting his adult children, a maneuver legal under conflict-of-interest law but one ethics experts say hollows out its purpose, and he could keep contracting with Cerberus for administrative services. That contract was meant to end in April 2026. In January, he reversed course and extended it with no end date. The financial relationship between the deputy secretary of defense and the private equity firm he used to run now continues indefinitely.

Meanwhile the department began handing out contracts for Golden Dome, Trump’s missile-defense shield, a program that has already ballooned to an estimated $185 billion. The Pentagon at first refused to name the companies winning the work. When it finally released a list, at least four of the winners turned out to be owned or partly owned by Cerberus: North Wind, Stratolaunch, Red River Technology, and NetCentrics. The department still will not disclose what those contracts are worth, and by law is required to announce only those above $9 million.

Does Feinberg personally pick the contractors? The department says he has no direct responsibility for Golden Dome acquisitions. But the general who runs the program, Michael Guetlein, described his own chain of command without ambiguity: I report to the deputy secretary and only to the deputy secretary, he said. He is the only official who can tell me no. The man who can say no to the entire missile-defense program is the man whose old firm owns the companies being paid to build it, and whose family may still profit from that firm’s returns. No single email needs to be produced. The architecture does the work.

The recruiting pitch says it out loud

For anyone wondering how normal this has become, the sales brochure settles it. To staff its new investment operation – an “Economic Defense Unit” meant to deploy up to $200 billion over three years – the Pentagon hired the headhunting firm Heidrick & Struggles, whose recruiting deck went hunting for bankers at Goldman Sachs, Morgan Stanley, JPMorgan, and Bank of America.

The pitch promised recruits unmatched access to top-level government officials and privileged information flow — whatever you need, you can get. It offered salaries reaching $600,000 through a government-aligned nonprofit, against a federal average near $100,000. And it described the job not as public service but as a two-year secondment leading to exceptional exit opportunities, including the chance to launch a new fund with members of the team. Come into the government, use the access, leave richer, on the strength of relationships built on the public payroll. This is not a leak of something embarrassing. It is a document written to attract people, on the assumption that the merger of private profit and public office is the perk.

A former assistant director on the White House technology-security staff, reading the same deck, warned that an effort this size has the potential to distort national-security-critical industries in ways he did not think anyone had seriously contemplated. There is, he added, obvious potential for truly egregious corruption. But corruption is almost the smaller point. Corruption implies a rule being broken. What is happening here is a rule being dissolved.

The same men, both shores

Line them up. Merz chaired an asset manager and then commanded the German rearmament that manager profits from. Phelan ran a billionaire’s money and then took command of the Navy that buys from the companies he held. Feinberg ran a private equity empire and then took the Pentagon’s second chair and filled the building with his former partners. Different countries, different uniforms, one profession and one move: from owning the assets of war to commanding the state that pays for them.

The line worth repeating from Merz’s own story turns out not to have been about Germany at all. The buildup manufactures the danger it claims to answer. Every European budget hardens Moscow’s conviction that it is being encircled, which justifies the next budget, around and around, while the men who profit count their dividends and call it security. That was true of one chancellor. It is true of an entire class of men who have stopped seeing daylight between the public interest and their own book, because across their whole careers there never was any.

The old fear, the one Eisenhower named in 1961, was that the military-industrial complex would acquire unwarranted influence over the government. That fear is quaint now. Influence is what you need when you are standing in the corridor. These men are not in the corridor. They are behind the desk, and the desk has a checkbook with no ceiling, and the recruiting brochure is on the table telling the next banker that whatever he needs, he can get.

Thomas Karat writes investigative work published at karat.substack.com and the Libertarian Institute, drawing on a corporate career and academic training as a behavior analyst to examine how institutions manufacture consent and influence.

Tyler Durden Fri, 07/10/2026 - 05:00

Europe Votes Against Thought-Policing 'Chat Control', Brussels Passes It Anyway...

Europe Votes Against Thought-Policing 'Chat Control', Brussels Passes It Anyway...

On Thursday in Strasbourg, 314 Members of the European Parliament voted to reject the return of "Chat Control," the legal regime allowing tech companies to scan the private messages of roughly half a billion Europeans.

Illustration via proton.me

Only 276 voted to keep it.

So naturally, the scanning regime won - thanks to a 'quirky' voting procedure in Brussels that allowed legislation to survive even though most MEPs who cast a vote opposed it. That should alarm anyone who still believes the word "parliament" is supposed to mean something.

Losing by Winning

The vote took place at second reading, under an urgent procedure pushed through just two days earlier by Parliament's largest bloc, the centre-right European People's Party.

At second reading, the arithmetic is rigged toward passage. Rejecting or amending the text does not require a majority of votes cast. It requires an absolute majority of all 720 MEPs: 361 votes.

That means every absent MEP and every abstention effectively counts in favor of the law.

On Thursday, 607 members voted: 314 to reject, 276 to proceed, and 17 abstained. Another 113 were not in the chamber. The rejection therefore fell 47 votes short of the required threshold. A clear majority of voting MEPs opposed the measure - and the measure became law again anyway. Not coincidentally, the vote was scheduled for the final sitting day before Parliament dispersed for its summer recess, when absenteeism is at its annual peak.

The path to this outcome is as important as the result. Parliament had already rejected an extension of these same rules on 26 March. The regulation then expired on 3 April. In any functioning democratic system, that would have been the end of it. Instead, the Council returned on 2 July with essentially the same text, repackaged as a new proposal. Then, on 7 July, the EPP secured an urgency procedure by a narrow 331-to-304 vote, bypassing committee scrutiny and setting up Thursday's vote under second-reading rules.

Marketa Gregorova, the Greens/EFA negotiator on the file, accused the EPP of violating Parliament's own rules of procedure and abusing its position to force a re-run of a question the chamber had already answered. She was right to do so.

When a legislature can be made to vote on the same question repeatedly, under progressively worse rules, until it produces the desired answer, the word "vote" begins to look decorative.

What was revived on Thursday is "Chat Control 1.0" - the ePrivacy derogation first adopted in 2021 - not the broader permanent proposal commonly known as Chat Control 2.0.

The revived regime permits, rather than requires, providers such as Meta, Google and Microsoft to scan private messages, emails and uploaded images on unencrypted services for child sexual abuse material. It will now run until April 2028, unless permanent legislation replaces it first.

Parliament did manage to push through two concessions. Amendments exempting end-to-end encrypted services passed with 369 and 362 votes, carried by an unusual coalition spanning liberals, the left and parts of the right. That matters: Parliament is now formally on record against breaking encryption.

But as civil-rights campaigner Patrick Breyer notes, the victory is partly symbolic. Providers cannot meaningfully scan end-to-end encrypted content in the first place without undermining the encryption itself.

The more revealing vote was the one that failed. An amendment to restrict scanning to individuals actually identified as suspects by the judiciary won a clear plurality, 322 to 255. But because it also needed 361 votes, it died.

In other words, a majority of voting MEPs wanted scanning limited to actual suspects.  Europe got suspicionless scanning of everyone instead.

Tyler Durden Fri, 07/10/2026 - 04:15

Is She Going To Eat It?

Is She Going To Eat It?

Authored by Steve Watson via Modernity News,

Migrants continue to treat Britain's streets, parks, and waterways like a personal hunting ground, with fresh footage exposing the grim reality of unchecked mass immigration.

A disturbing new video circulating on X shows a woman - widely identified in comments as a migrant - seemingly actively hunting birds.

She uses a sheet to capture a seagull perched on a gate or property edge. After securing the bird, she looks around for more prey, scanning the area as if on a deliberate hunt.

When locals spot her and begin filming while questioning what she is doing with the bird, she gestures dismissively - as if to say "what's your problem?" and implying this is totally normal behaviour and none of their business.

The clip has sparked widespread outrage, with many slamming the trespass and illegal taking of wildlife.

There have been further suggestions that the woman was actually "rescuing" the bird, but many are not buying that explanation.

This latest incident fits a clear pattern. Migrants have been repeatedly filmed hunting pigeons, with their bare hands in UK streets, and even using fishing rods to try and catch them.

Similar scenes have played out with protected swans and ducks across the UK and Ireland, where migrants set traps and butcher birds in public spaces.

The depravity doesn't stop at birds. On the continent, a Nigerian migrant was caught cooking a cat in a public park next to a children's playground, drawing fury from locals.

These cases echo reports from Springfield, Ohio, where Haitian migrants faced accusations of snatching and consuming local wildlife, including ducks and geese in parks.

Residents described scenes of animals being grabbed by the neck, decapitated, and taken for food - claims that amplified national debate over mass migration's impact on communities and norms.

British wildlife laws under the Wildlife and Countryside Act strictly protect many of these species. Yet enforcement seems inconsistent when it involves certain arrivals who show little regard for local customs, laws, or basic animal welfare.

Locals filming these confrontations repeatedly highlight the same point: these individuals have housing, clothing, and food provided, yet they hunt urban birds as if in a survival scenario from their countries of origin.

The cultural clash is undeniable. Britain, long a nation of animal lovers with strong traditions of protecting wildlife, now contends with behaviors that treat public spaces as open butcheries. Pigeons and seagulls in cities scavenge in polluted environments, raising health risks from diseases, but that hasn't deterred the hunters.

This is a visible symptom of failed open-border policies that prioritize globalist ideals over national cohesion and rule of law. While politicians lecture about tolerance, everyday Brits watch their parks and streets transformed, and communities on edge.

Mass immigration without assimilation imports incompatible practices that erode Britain's way of life. Strong borders, enforced laws, and putting citizens first aren't radical - they're essential to preserving what remains of civilized society.

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 Fri, 07/10/2026 - 03:30

Erdogan Taunts Israel & Greece After Trump Hands Turkey F-35, Sanctions Win

Erdogan Taunts Israel & Greece After Trump Hands Turkey F-35, Sanctions Win

Turkish President Recep Tayyip Erdogan has responded to ongoing Israeli and Greek objections to the possible US sale of F-35 fighter jets to Turkey by mocking the Turkish enemies and rivals.

Opposition to the potential stealth fighter transfer raised by Prime Minister Benjamin Netanyahu and Greece’s Kyriakos Mitsotakis "has no place in my world," Erdogan said in his characteristically bellicose manner.

"Hopefully, when the F-35s are delivered to Turkey, the whole world will say America kept its promise," Erdogan said at a Wednesday closing news conference for the NATO summit hosted in Ankara. 

Netanyahu told Fox News on Monday that "Turkey is a great country, but it's governed by a man who calls openly for the annihilation of Israel" - in reference to Erdogan. "He occupies half of Cyprus, a NATO country. He's threatening Greece, another NATO country, and he talks openly about conquering Jerusalem."

The Israeli leader also said that giving Ankara F-35s or fighter jet engines would "upset the power balance in the Middle East, which is ultimately guaranteed by Israeli air superiority and also by, I think, by America's posture in the Middle East." He's been urgently requestion that the White House reign in Erdogan and his provocative rhetoric.

However, Israeli pressure did nothing to sway Trump while the US President was in Turkey. Trump strongly signaled he's ready to go through with the sale of F-35s, saying of Erdogan, "We are great friends".

What's more is that Trump declared - to the surprise of US Congress (who will want a word on this) that he'll be removing US sanctions which were imposed on Turkey during his own prior administration: 

In response to that purchase, Washington in 2020 imposed sanctions on a major Turkish defense company and removed Turkey from the F-35 stealth fighter jet program, where Ankara was also a production partner.

"We’re going to be taking the sanctions off," Trump told reporters just before his meeting with Erdogan during a visit to Turkey for a NATO summit. He added that his secretary of state and Treasury secretary were working on the issue.

In the moment, Secretary of State Marco Rubio looked a bit surprised, while President Erdogan beamed with a sense of victory...

Later, Erdogan voiced that in reality the United States is "not enforcing any sanctions against us" and that "by and large, those measures have already been lifted."

He said of his top national security officials, "They have all witnessed firsthand that these sanctions are not being applied to Türkiye. So, we have no such problem. And whenever an issue does arise, Mr. Trump, thankfully, returns our call within 24 hours whenever we reach out to him. Within that same 24-hour period, we receive the response we need."

The Turkish foreign ministry has also hit back at recent Israeli statements, saying, "The baseless allegations recently circulated by Israeli officials in a coordinated manner and with calculated timing are part of a disinformation campaign." The statement added: "Netanyahu and his partners in crime deliberately distort any criticism directed at them and seek to divert attention through a systematic propaganda effort."

Tyler Durden Fri, 07/10/2026 - 02:45

Europeans Should Embrace The American Revolution

Europeans Should Embrace The American Revolution

Authored by J.B. Shurk via American Thinker,

The time has come for Europeans to declare their independence from ruling-class tyranny.

We made it to our two-hundred-fiftieth birthday, America.  What’s next?  Let’s get back to work, so that our descendants can celebrate one thousand.

Making sure the American Experiment endures is work, after all.  Protecting American ideals from our ideological enemies is never easy.

Well before our nation declared independence from Great Britain, the American system repudiated the whole “ruling class” hierarchy that — to this day! — still oozes from the infected abscesses of the United Kingdom and much of continental Europe.  After we fought two world wars in the twentieth century to save Europe from itself, we spent the Cold War period in a bit of a kumbaya stupor during which Americans often equated the beliefs of Western nobles with those who founded and built the United States.

But Europe and America have never been the same.  The people who built America left Europe behind for good reasons.  They rejected Europe’s aristocratic allegiances, its feudal social structures, and its false pretension that blue-blooded “elites” are divinely and innately empowered to rule over everyone else.  The Declaration of Independence and the U.S. Constitution are not merely documents establishing America’s political separation from Britain and the legal foundations for its new government.  They are revolutionary statements of America’s intent to remove itself from the generational enslavement upon which monarchies, ruling classes, and feudal systems depend.

Taken together, the Declaration and Constitution assert fundamental truths that governments throughout human history have tried to obscure from their peoples.  Those truths include the recognition that all of us are equal before God; so-called noble aristocrats are not divinely given or entitled to receive more power or privilege than the common man.  Furthermore, our rights come from God, not the government.  Aristocrats, government officials, elected representatives, and bureaucrats cannot give us what only God provides for our well-being and happiness.  Additionally, because governments are artificial creations constructed by imperfect human beings, they are legitimate only when the people who live under those governments consent to their structure.  Governments that exercise power in defiance of the will of the people are unjust governments utilizing illegitimate powers.  Finally, when governments deny the people their God-given rights, fail to keep the public safe, undermine their citizens’ happiness, usurp powers belonging to the people, abuse the public, or threaten the lives and liberties of citizens, the people have a right — nay, a duty! — to overthrow those governments and replace them with new governments more likely to protect the people’s lives, liberties, and God-given rights.

These assertions didn’t just repudiate the British Crown.  They repudiated the legitimacy of governments throughout the world.  Princes justified their powers over common people as expressions of God’s will.  Claiming to be God’s direct emissaries on Earth, noble aristocrats considered themselves the arbiters of what rights and liberties common people might enjoy.  The American Revolution rejected these premises as outright lies.  Princes are endowed with the same rights as commoners.  Rights and liberties come from God, not ruling class elites!

In other words, America’s War for Independence was also a war that threatened systems of power throughout the world.  If legitimate government powers come directly from the people, then the whole feudal hierarchy is inverted.  Rather than a pyramid with a king or queen on top who allocates certain powers to a small royal court of lords who allocate a few powers to vassals who allocate a tiny portion of those powers to peasants who remain in indentured servitude, the Declaration of Independence asserts that power arises from the base of the pyramid with the people and that government authorities merely borrow the people’s power as temporary custodians obligated to secure and advance the public’s will.  Nothing at the top of the pyramid is legitimate unless the bottom of the pyramid consents.  Two-hundred-fifty years ago, America turned the world upside down.

Do any of these American convictions describe Europe today?  Does the unelected European Commission President Ursula von der Leyen behave as someone who derives her power from the consent of those Europeans she insists upon governing?  Do the digital censorship laws that prevent citizens of the United Kingdom and the European Union from freely communicating with each other protect their God-given rights and liberties?  Do the growing swarms of European bureaucrats writing endless rules and regulations inside unaccountable government institutions appear to respect the people’s inherent powers?  Do Europe’s open borders policies provide European citizens with security, safety, and happiness?  If the answer to these questions is “no,” then don’t common Europeans have the right and duty to overthrow their governments and form new institutions committed to their protection and the preservation of their freedoms?  Otherwise, aren’t most of the bureaucracies and government institutions of Europe wholly illegitimate?

It is easy to see why governments around the world don’t spend much time teaching young students about the Declaration of Independence or the American Revolution.  If they did, most citizens would immediately recognize their own forms of government as oppressive, harmful, unjust, and resentful of God’s authority.

This is why European political “leaders” refuse to talk about rights and freedoms and instead drone on about “democracy.”  It is difficult to explain how rights and freedoms can be inalienable when governments insist on defining, redefining, or abridging them whenever those in power find it necessary or convenient to do so.  “Democracy,” on the other hand, stands for nothing other than the dangerous proposition that fifty-one cannibals can vote to eat forty-nine of their neighbors.  “Democracy” can even be twisted to mean that a couple dozen European Commissioners are entitled to choose a European Commission president who is somehow entitled to write laws for all of Europe.  Such an arrangement undermines all safeguards for Europeans’ inalienable rights and liberties.  Describing fascism, socialism, or monarchy as “democratic” does not lend legitimacy to despotic forms of government.

To this day, Europe’s leaders don’t understand America.  Or they understand, but they pretend that America embraces European “values.”  Or they look down upon America as some kind of wild mongrel that makes a good guard dog but remains incapable of appreciating the dignified sensibilities of European “elites.”  The noble gentry who spread their cancerous ideologies from Brussels do their best to groom and domesticate America while expecting us to pee on the rug at any time.  Europe’s entrenched aristocracy prefers for the unruly American dog to stay outside.

Part of the reason we are “unruly,” though, is that our political instincts are foreign and threatening to a European feudal structure that demands total power for the few and no power at all for the many.  Europe’s bureaucrats prefer Karl Marx to Thomas Jefferson.  Europe’s aristocratic “elites” prefer declarations of dependence to America’s Declaration of Independence.

The future is not a battle between the so-called “democratic” West and the authoritarian regimes of the world.  The future is a battle between feudal forms of government and an American system that recognizes governments as legitimate only when they are used to protect each individual’s God-given rights.  Both in Europe and the United States, the war against government tyranny and for human freedom will continue to rage.  European and American “elites” will do everything they can to foster public dependence upon government.  European and American citizens who wish to be free must declare their independence from Big Government.

There are those alive today who believe that Big Government cannot be beaten.  That’s natural.  Two-hundred-fifty years ago, few believed that America’s Declaration of Independence would lead to the British Empire’s defeat.  The war for human freedom never truly ends.  Every generation must fight to secure their God-given rights.  When governments forfeit the people’s consent and undermine the people’s freedoms, they are rendered illegitimate.  There is but one public remedy: revolution.

Tyler Durden Fri, 07/10/2026 - 02:00

113 Active Spies From Foreign Countries Arrested: FBI Director

113 Active Spies From Foreign Countries Arrested: FBI Director

Authored by Naveen Athrappully via The Epoch Times,

The FBI has arrested 113 active spies from foreign nations, agency director Kash Patel said on Wednesday.

FBI Director Kash Patel testifies on Capitol Hill in Washington on May 12, 2026. Madalina Kilroy/The Epoch Times

The arrests of foreign spies "means our tech stays home and our defense secrets stay locked down," a video shared by Patel on X said. "But the FBI didn't stop there. They forced 62 removals of Chinese spies in 2026 alone."

The video added that this has shattered the Chinese Communist Party's (CCP's) deep cover operations against the United States.

The House Committee on Homeland Security released a report in February 2025 detailing multiple cases of espionage conducted by the CCP in the United States since 2021.

The cases, spread across 20 U.S. states, involved the transmission of sensitive military information to Beijing, stealing trade secrets to benefit the regime, transnational repression schemes targeting Chinese dissidents, and obstruction of justice. Every 12 hours, the FBI opened new cases to counter Beijing's intelligence operations, according to the report.

The report noted that the CCP's theft of U.S. intellectual property amounts to roughly $4,000 to $6,000 annually per American family of four after paying taxes.

In one prominent case, a senior adviser to the State Department was arrested in October 2025, accused of taking thousands of top-secret documents and meeting with Chinese officials. The individual allegedly downloaded and saved documents related to U.S. fighter jets and weapons capabilities.

On Jan. 12 this year, the Department of Justice (DOJ) announced that a former U.S. Navy sailor was sentenced to 200 months in prison for spying for Beijing.

The person had access to sensitive national defense information about the amphibious assault ship U.S.S. Essex, such as its weapons, propulsion, and desalination systems. These ships are a "cornerstone of the U.S. Navy's amphibious readiness and expeditionary strike capabilities," according to the DOJ statement. The sailor sold critical information to a Chinese intelligence officer for $12,000.

More recently, on June 4, the DOJ announced that a U.S. citizen pleaded guilty to acting as an agent for China. The man, who lived in China, would travel to the United States to meet with individuals who could provide him, and ultimately the Chinese Ministry of State Security, with important information.

Digital Threats, Cartels

The video shared by Patel also said that the FBI has been successful in countering cyber threats.

On Jan. 8, the FBI issued an alert warning about a North Korean state-sponsored cyber threat group targeting American entities with a QR code phishing scheme to steal sensitive information. As of last year, threat actors from the group targeted academic institutions, think tanks, and U.S. and foreign government entities.

Last month, the DOJ said that 13 internet domains backed by suspected Chinese agents were seized by authorities. The domains were used to target Americans with security clearance to access classified government information.

The FBI is now targeting cartels as foreign terrorists, which has led to around 4,800 cartel members getting arrested, the video said.

Despite the ongoing crackdown, cartels are shifting drug trafficking tactics. During a Senate committee hearing on May 12, top law enforcement officials raised concerns about some Mexican cartels moving operations to Canada in order to manufacture and distribute fentanyl.

Terry Cole, head of the Drug Enforcement Administration, said there have been "significant seizures" of fentanyl in Canada over the previous months.

At the hearing, Patel said: "The drug traffickers got smart with the securitization of the southern border and moved it up there [to Canada]. So we're tackling that with our seize partners."

Tyler Durden Thu, 07/09/2026 - 23:25

Fiber-Optic Kamikaze Drone Found In Mexico Signals New Drone Threat South Of Border

Fiber-Optic Kamikaze Drone Found In Mexico Signals New Drone Threat South Of Border

The global proliferation of low-cost suicide drones is setting off alarm bells across the US military and among national security officials and experts. The race to harden high-value assets in the homeland, from military bases and airports to power substations, crude oil refineries, stadiums, and data centers, is already underway as officials fear the next major threat could come from a cheap drone equipped with a warhead.

The latest warning that Ukrainian-style drones are just south of the US-Mexico border comes from a new report by the Mexican newspaper El Sol de Durango, which states that Mexican federal forces discovered an unjammable fiber-optic kamikaze drone during a raid on a compound.

The raid took place at a compound in the Dolores del Río neighborhood, located deep inside north-central Mexico, about 500 miles from the US border and about 560 miles from Mexico City by road.

The Attorney General's Office (FGR) reiterates its commitment to the investigation and prosecution of federal crimes and calls on citizens to report any illegal activity, either in person or anonymously. / Photo: Courtesy / FGR

The Mexican Army and National Guard secured the perimeter of the compound, while Durango's regional federal prosecutor's office and other law enforcement agencies found the fiber-optic suicide drone, guns, ammunition, ATVs, and other vehicles.

They seized an explosive device, two magazines and 78 cartridges of different calibers, a drone, two ATVs and four vehicles / Photo: courtesy / FGR

From the local outlet:

The operation stemmed from a citizen complaint received by the Attorney General's Office (FGR ) through the Single Window for Attention (VUA), in which a member of the National Guard (GN) reported potentially criminal activity at the aforementioned address. In response, the Federal Public Prosecutor (MPF) requested and executed a search warrant for the location.

During the operation , supported by agents of the Federal Ministerial Police (PFM) and the Criminal Investigation Agency (AIC), authorities seized an explosive device , two magazines and 78 rounds of ammunition of various calibers, a drone, two ATVs, and four vehicles . The perimeter was secured by personnel from the Mexican Army ( Sedena ) and the National Guard (GN).

The importance of this find is that fiber-optic kamikaze drones, once largely confined to major war zones across Eurasia, from the Russia-Ukraine conflict to the Gulf area, now appear to be spreading worldwide.

Even more troubling, this drone was found roughly 500 miles south of the US-Mexico border. The discovery points to one unavoidable conclusion drawn from today's conflict zones: the US must supercharge the hardening of high-value assets against this drone threat (read here).  

Military bases, airports, power substations, refineries, ports, data centers, and other critical infrastructure are entering a whole new risk environment in which cheap drones can cause outsized damage.

We recently penned a note for readers on how to profit from the "asymmetric warfare boom." Read the note here.

Tyler Durden Thu, 07/09/2026 - 23:00

Federal Agents Targeting Illegal Truck Drivers At Weigh Stations Nationwide

Federal Agents Targeting Illegal Truck Drivers At Weigh Stations Nationwide

By Noi Mahoney of FreightWaves

Federal immigration agents are now working alongside state troopers at commercial truck weigh stations across the country as the Trump administration intensifies its crackdown on illegal commercial drivers, according to U.S. Border Czar Tom Homan.

Appearing on Fox News on Tuesday, Homan said the Department of Homeland Security is partnering with the U.S. Department of Transportation and state law enforcement agencies to identify commercial drivers who are operating trucks with improperly issued commercial driver’s licenses. 

“We’ve got a lot of people we’re looking for,” Homan said. “Actually, some states we’re actually working weigh stations with the troopers, trying to get these people as they’re coming through.”

Homan said more than 28,000 non-domiciled commercial driver’s licenses have been revoked nationwide and acknowledged that obtaining driver records from some states has complicated enforcement efforts.

"We’re working very closely with many states,” Homan said, adding that DHS is coordinating with Transportation Secretary Sean Duffy while the Department of Justice pursues legal action against jurisdictions that refuse to share driver information.

Enforcement expands beyond paperwork

The latest announcement builds on a series of recent commercial vehicle enforcement operations by state agencies focused on licensing violations, unsafe equipment, hours-of-service compliance and immigration-related offenses.

Last week, FreightWaves reported that law enforcement agencies in Texas, Arizona and California had expanded commercial vehicle inspections targeting unqualified drivers and unsafe trucks. Those operations resulted in immigration arrests, equipment citations and drivers being placed out of service.

Homan suggested the latest federal effort goes beyond revoking licenses by focusing on locating drivers who remain behind the wheel after their commercial driving privileges have been canceled.

According to Homan, DHS agents are working directly with state troopers at weigh stations to identify those drivers during routine commercial vehicle inspections.

Arizona stop highlights safety concerns

The enforcement push comes as Arizona authorities continue reporting cases involving commercial drivers operating without required credentials.

In a Facebook post, the Arizona Department of Public Safety said on Tuesday a Highway Patrol Commercial Vehicle Enforcement trooper stopped a hotshot truck on June 26 along State Route 202 near Arizona State University after discovering numerous violations.

Investigators said the driver lacked both a commercial driver’s license and a required USDOT medical certificate. Inspectors also found that none of the trailer’s brakes were functioning, meaning only the tow vehicle could stop the fully loaded 14,900-pound trailer. 

Arizona troopers also cited exposed hubcaps and a missing emergency brake cable before placing the driver and vehicle out of service.

Tyler Durden Thu, 07/09/2026 - 22:35

When Will The Cattle Cycle Turn? BofA Has Answers For Beef Lovers

When Will The Cattle Cycle Turn? BofA Has Answers For Beef Lovers

Bank of America analysts spoke with Oklahoma State University agricultural economist Derrell Peel, who offered new insight into the US cattle cycle. His key takeaway: the herd-rebuilding phase may not meaningfully begin to turn until near the end of the decade, suggesting elevated beef prices at the supermarket are here to stay.

The most important issue in the beef industry is when the cattle cycle will turn. The US beef cow herd is the smallest since 1961, while the 2025 calf crop is the smallest since 1941. Beef production is expected to decline by 4.5% to 5% in 2026 and continue falling through at least 2027, despite heavier carcass weights partially offsetting lower slaughter volumes.

Peel explained to Sara Senatore, a BofA Securities research analyst covering restaurants, protein processors, and food and beverage, that the beef industry has not yet seen the tightest supplies because meaningful heifer retention has only just begun.

He added that if ranchers begin saving heifer calves in 2026, those animals would be bred in 2027, calve in 2028, and only begin adding to supply in 2029 or 2030.

Peel explained more about when the cattle rebuilding cycle could turn: 

The bottom line is, I don't think we're saving very many heifers yet. I don't think we're doing more than perhaps slowing the liquidation down, or stabilizing the herd. We're certainly not going to expand any in 2026. I think the prospects for expansion in 2027 are very limited at this point, because again we know that the supply of heifers that's already on the ground, that we would need to be breeding this year to enter the herd next year, just isn't there.

And so if we start saving heifers, which would really be heifer calves in 2026, we breed them in '27, they would calve in 2028, we're talking about 2029 into 2030 before those calves would be weaned and fed out and have an impact on beef production. So we're really looking at the end of the decade before we can change the path here.

And in fact, what it means is that in the meantime we have to save some additional heifers. We haven't yet seen the tightest supplies of this particular situation. We've got tight supplies, the feeder supply continues to decline with these smaller calf crops, but at some point we have to pull additional heifers out of that mix in order to retain them for herd rebuilding. We have not done that yet to any appreciable degree.

Cow calf producers are getting market incentives, returns are good. But we've been very slow to respond as an industry for, I think, a wide variety of reasons, that includes drought and financial conditions and demographic changes in the herd or in the producer population, and just a variety of things that contribute to that.

The upshot of it all, this is my final analytical slide, is that we think that prices will continue to go even higher. I would expect that heifer retention process to be what would put the peak in this thing. That peak will not happen, in my opinion, at this point in 2026. It will be at least into 2027. And there is a possibility that it gets pushed off even beyond that if we don't see some indications of heifer retention pretty quickly here in 2026.

So the short answer is the current situation will continue, and I think persist, and actually get a little bit more in terms of higher cattle prices. Now, that's all predicated on demand continuing as strong as it is. I don't see that changing at this point. There's certainly some potential threats out there that we're watching, but I don't see demand changing enough to prevent this.

So the short answer is the current situation will continue, and I think persist, and actually get a little bit more in terms of higher cattle prices. Now, that's all predicated on demand continuing as strong as it is. I don't see that changing at this point. There's certainly some potential threats out there that we're watching, but I don't see demand changing enough to prevent this.

The warning that the cattle cycle is still several years from a meaningful turn builds on our prior note that there are "no quick fixes" for historically tight supplies.

The structural fix is herd rebuilding, and Peel's timeline points to meaningful relief in beef production closer to 2029-2030, not anytime soon.

In other words, high supermarket beef prices are not a temporary squeeze. This is a new reality folks must understand: a broken cattle cycle that will take years to repair - and quality might lack... 

That's why locking in high-quality beef now matters. While the Trump administration searches for ways to bring prices down (see here) and the industry waits years for herds to rebuild, readers can skip the junk at the supermarket and buy directly from our ranchers. 

Buy here. 

Tyler Durden Thu, 07/09/2026 - 22:10

'World's Largest' Heavy-Lift Cargo Aircraft Targeted For Military And Disaster Logistics

'World's Largest' Heavy-Lift Cargo Aircraft Targeted For Military And Disaster Logistics

Authored by Christopher McFadden via Interesting Engineering,

Radia and Blue Water Shipping (Blue Water) have announced a strategic alliance that will combine the former's gigantic Windrunner aircraft with the latter's global logistics network. Under the agreement, Radia will supply the aircraft, and Blue Water will do basically everything else.

Image of several Radia Windrunner aircraft taxiing.Radia

"The companies expect to focus initial collaboration efforts across several strategic sectors, including energy and project cargo, humanitarian aid and disaster relief, aerospace logistics, and military and defense-related transportation," Radia explains in a press release.

In case you are unaware, the Windrunner is being marketed as the world's "largest cargo aircraft." Not in terms of raw weight, incidentally, but rather in the fact that it can vary extremely large, and non-standard cargo.

To date, examples have included 328-foot (100-meter) long turbine blades, large military vehicles, satellites, and aircraft fuselage parts, among other notable examples. So, in a sense, the selling point for it is its cargo-carrying volume.

Windrunner Is One Hell Of An Aircraft

Another interesting wrinkle is that the Windrunner is designed to operate out of both existing and "semi-prepared runways." This means it can deliver cargo to dirt strips, compacted gravel, temporary runways, and remote airfields.

That means it could, in theory, fly directly to places like wind farm construction sites, military bases, disaster zones, and mining projects, rather than unloading hundreds of miles away.

Both Radia and Blue Water are particularly pitching their services to militaries and humanitarian aid efforts. The former often requires irregular cargo like radar systems, missile launchers, helicopters, engineering gear, bridge-laying equipment, etc, delivered to areas with no existing aerodromes.

The same is true for humanitarian aid, especially when natural disasters have knocked out existing infrastructure.

"Many of the industries we support are constrained not only by infrastructure but by the inability to efficiently move oversized cargo where and when it is needed," said Mark Lundstrom, Founder and CEO of Radia.

Blue Water is a logistics company that has made its fortune arranging global logistics via things like ships. trucks, trains, etc, and navigating all the administrative red tape like customs, permits, etc. Both companies believe they can combine their respective talents to streamline the integration of their respective services.

Not An Exclusive Partnership, More Of An Open Relationship

"By combining WindRunner's transformational airlift capabilities with Blue Water Shipping's global logistics expertise, we believe we can help create more flexible and resilient transportation solutions for customers operating in some of the world's most challenging environments," Lundstrom added.

"Blue Water Shipping has extensive experience delivering complex logistics solutions across industries that depend on precision, reliability, and flexibility," said Rasmus Svane, Head of Global Product Development Wind, Blue Water Shipping.

"Our collaboration with Radia represents an exciting opportunity to explore new logistics models for oversized cargo and help customers rethink what is possible when combining multimodal transportation solutions," he added.

It is important to note that the agreement is for both to become "preferred partners" of one another. That doesn't mean exclusivity, but rather, they will bid together for projects that benefit both.

Tyler Durden Thu, 07/09/2026 - 21:45

"Turn Off Bluetooth, Use Signal": ACLU Advises Anti-Trump Protesters On Evading Gov't Surveillance

"Turn Off Bluetooth, Use Signal": ACLU Advises Anti-Trump Protesters On Evading Gov't Surveillance

If you want a sign of how the left-wing, permanent protest-industrial complex is gearing up for the next wave of street mobilization, look no further than Chad Marlow, a senior policy counsel at the ACLU.

Marlow, whose work focuses on privacy, surveillance, and technology, has circulated guidance for protesters on social media about how to limit digital exposure, avoid government surveillance, and communicate via encrypted messaging platforms while protesting.

"If you're protesting and not actively using your phone, the best thing you can do to prevent it from sharing information about you and your location is to shut it off entirely. If you want to turn on your phone to take pictures and record video during the day, turn your phone on, enable Airplane Mode, and turn off Bluetooth. That way, your phone won't be inadvertently sharing your private location and other data while you're using it," Marlow said in a video posted on Instagram.

He continued, "If you need to use your phone, turn it on while you're communicating, then shut it off when you're done. By the way, it's always safest to use a fully encrypted app like Signal, which makes it more difficult for the government to intercept your communications."

The ACLU is listed as a proud partner of the failed No Kings rally, an event that is far from organic; instead, it is a heavily coordinated coalition of far-left socialist groups, NGOs, and unions seeking a socialist revolution by toppling Trump.

Marlow's educational session on how protesters can limit digital exposure and evade government surveillance is certainly not a good look for a nonprofit that claims to defend all civil liberties. Instead, it has become a legal arm of far-left protesters.

Related:

Concerns that the ACLU is no longer merely protecting constitutional rights but is increasingly helping to equip DSA-aligned protesters for their revolution are very troubling, given what socialists say in their own words:

This blurs the line between civil-liberties advocacy and activist support infrastructure at a time when the broader protest-industrial complex appears to be gearing up for the next round of street chaos. 

Tyler Durden Thu, 07/09/2026 - 21:20

Justice Department Agrees To End Biden-Era Oil & Gas Leasing Restrictions In Alaska

Justice Department Agrees To End Biden-Era Oil & Gas Leasing Restrictions In Alaska

Authored by Jill McLaughlin via The Epoch Times,

The U.S. Department of Justice said July 7 the Biden administration’s oil and gas leasing restrictions in northern Alaska’s Arctic region violated federal law and asked the court to dismiss lawsuits by the state and its industrial development and export authority challenging the regulations.

The lawsuits were filed in 2025 over the Biden administration’s 2024 restrictions on oil and gas lease auctions in the Coastal Plain of the Arctic National Wildlife Refuge. Alaska argued that the administration essentially sabotaged bidding with its restrictions on surface use and occupancy, which made “any development economically and practically impossible.”

“The Biden era Alaska oil and gas leasing program violated the law and improperly limited Alaska’s energy potential with unreasonable regulation,” U.S. Acting Attorney General Todd Blanche said in a July 7 press release.

“This settlement supports the Trump administration’s commitment to secure American energy independence and our national security for generations to come,” he added.

Congress set aside 1.5 million acres along the Alaska coast in 1980 for potential oil and gas development, and in 2017 instructed a federal agency to develop the resources on the land. Alaska’s lawsuit claims the Biden administration negated Congress’s directive.

“These resources not only help our energy independence as a nation but also grows the Alaska economy and puts more money in the Alaska Permanent Fund for future generations,” Gov. Mike Dunleavy said in a January 2025 statement.

The settlement says the 2024 leasing program violated the 2017 Tax Cuts and Jobs Act by abdicating the government’s duty to conduct a second lease sale, closing 75 percent of the 1.56 million-acre Coastal Plain to exploration and leasing, imposing unreasonable surface use restrictions on the remaining 25 percent, and unreasonably restricting surface disturbance.

“This settlement sets the record straight that the Biden administration’s 2024 restrictions on oil and gas production in Alaska were overly restrictive and contrary to Congress’s clear command to establish a competitive oil and gas leasing program in Alaska’s Coastal Plain,” Associate Attorney General Stanley Woodward said in a statement.

Alaska’s governor’s office and the industrial development and export authority didn’t immediately return requests for comment about the settlement.

The Justice Department also settled a decades-old lawsuit with Alaska on July 7 over a botched federal expansion project at the Don Young Port of Alaska in Anchorage, agreeing to pay the state $180 million.

Alaska Gov. Mike Dunleavy speaks at the White House in Washington on July 16, 2020. Jim Watson/AFP via Getty Images

The funds will go toward rebuilding the Don Young Port, according to Dunleavy.

The port serves about 90 percent of Alaska’s population with food, fuel, building materials, and other goods.

Tyler Durden Thu, 07/09/2026 - 20:55

New Hampshire Kills Historic $100M Bitcoin Bond Proposal

New Hampshire Kills Historic $100M Bitcoin Bond Proposal

New Hampshire's Executive Council narrowly rejected a proposal Wednesday that would have authorized a $100 million Bitcoin-backed bond, ending what supporters hoped would make the state a pioneer in digital asset finance, according to Bitcoin Magazine.

The measure failed in a 3-2 vote after reaching its final approval stage, despite receiving a favorable rating review from Moody's and backing from Governor Kelly Ayotte and the New Hampshire Business Finance Authority. Had it moved forward, officials said it would have been the first municipal bond in the world secured by Bitcoin.

The report notes that supporters argued the transaction would not put taxpayers at risk. Instead, it would have connected private investors with a private borrower using Bitcoin as collateral, while allowing the state to collect fees that could fund small business, housing, child care, and economic development initiatives if the deal proved successful.

Skeptics, however, questioned whether New Hampshire should attach its name to a financing structure built around a volatile digital asset. Councilor Karen Liot Hill said she was not opposed to cryptocurrency itself but believed the state should be cautious about endorsing a transaction tied to Bitcoin's price swings.

Business Finance Authority Executive Director James Key-Wallace rejected the idea that Bitcoin remains an "emerging" asset class, arguing it has already established itself in global finance. He also suggested the proposal could have opened the door to similar transactions in the future.

Ayotte, who signed legislation making New Hampshire the first state to authorize a strategic Bitcoin reserve and giving the state treasurer authority to invest in Bitcoin, said pursuing innovative financial structures is worthwhile so long as taxpayers remain protected.

The vote came after Liot Hill unsuccessfully attempted to delay consideration of the proposal. She was joined by Janet Stevens and David Wheeler in opposing the measure, while Joseph Kenney and John Stephen voted in favor.

The decision arrives as Bitcoin and the broader cryptocurrency industry are facing heightened scrutiny. Bitcoin has pulled back from recent highs, while renewed attention has focused on Michael Saylor and Strategy, whose aggressive Bitcoin dividend strategy has drawn increasing debate as the cryptocurrency's price weakens.

That backdrop has put high-profile Bitcoin-related proposals under a brighter spotlight, even as adoption efforts continue at the state and institutional levels.

Tyler Durden Thu, 07/09/2026 - 20:30

SoCal Education Leaders Stole Nearly $20M From Schools; Report

SoCal Education Leaders Stole Nearly $20M From Schools; Report

Authored by Bryan Hyde via American Greatness,

A new report has revealed that a pair of Southern California school leaders separately stole nearly $20 million from their schools in order to fund lavish personal lifestyles.

According to The New York Post, the report was co-authored by the State Financial Officers Foundation, a watchdog made up of state treasurers and auditors, and OpenTheBooks, a nonprofit focused on transparency in government spending.

The cases of the two Southern California educators were among the most expensive examples of K-12 education fraud documented nationwide.

Jorge Armando Contreras, the former fiscal services director for the Magnolia Elementary School District in Orange County, was charged with altering school checks over several years to funnel $16.7 million into his personal accounts.

Contreras was spending the money on everything from a luxury home and a BMW to designer clothes and pricey tequila and federal investigators found stacks of cash stuffed into a mini-fridge and luxury designer bags at his home.

He was sentenced to nearly six years in federal prison in 2024 and order to pay $16.7 million in restitution to the Magnolia School District in Orange County.

Another case highlighted in the report revealed that Janis Bucknor, the head of the Community Preparatory Academy charter school in Los Angeles, stole more than $3 million in taxpayer funds to cover travel, restaurants, shopping and private school tuition for her children.

Bucknor also pleaded guilty to spending more than $220,600 on Disney cruise line vacations, theme park admissions, and other Disney-related expenses.

According to prosecutors, Bucknor admitted in 2020 to stealing the funds, and was sentenced to three years’ probation and ordered to pay $2.5 million in restitution.

In a statement to Fox News Digital, State Financial Officers Foundation CEO OJ Oleka said:

All fraud is harmful, but defrauding education dollars meant to help kids learn and succeed is especially hideous. The findings in this report should alarm every family, teacher, and civic leader.

The California cases were part of nearly 90 cases identified by a coalition of auditors over the past six years involving embezzlement, phony invoices, inflated enrollment, bid-rigging and kickbacks, among other crimes.

The report follows the Trump administration’s promise to crack down on government waste, with Vice President JD Vance leading a nationwide “War on Fraud” that has raised new questions about oversight of federal education spending.

Tyler Durden Thu, 07/09/2026 - 20:05

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