Harsh truth
Socially destabilizing phenomena
I’m ready for the crack-up boom!1
Have a nice weekend, amigos. I hear the cheapest, highest seats start at $4,000.
"I will be as harsh as truth, and as uncompromising as justice."
Trending on Twitter on Tuesday:
There are many Epstein emails that are far worse than the few I mention below. If you want to know about those, you can do that on your own. It’s not that hard. A lot of people are on the case - just no one with the power to do anything about it.
Not sure why the name of the person asking Jeff Epstein where to find “high end eyes wide shut parties” was redacted.
Probably for national security.
Here’s noted feminist Larry Summers asking Jeff Epstein in Feb. 2017 what Goldman Sachs lawyer Kathryn Ruemmler thought Trump’s “attitude towards women” was:
Epstein: “ive told you - i have met some very bad people , none as bad as trump. not one decent cell in his body..”
Here Jeff Epstein tells Peter Thiel:
"as you probably know I represent the Rothschilds."
That name rings a bell.
This was in 2016 (remember, Epstein was a notorious sex offender since 2008).
And one more remarkable email, from Jeff Epstein’s brother Mark:
“Victims”
Yet Trump says this is all a hoax….
Deputy Attorney General Todd Blanch says they (understandably) won’t release CSAM or “anything that depicts or contain images of death, physical abuse or injury.”
They’ve had these files for many years.
WHO has been prosecuted for causing death, physical abuse or injury?
This always was in the back of my mind whenever I would trade Mexican mining companies (no positions now): Canadian mining firm says 10 employees abducted in Sinaloa, Mexico
“There is no resolve at the Federal Reserve to really bring inflation back down to target.”
Good grief. Worse than Carter & Biden??
In a recent podcast, short seller Carson Block named insurance companies as a potential future “black swan” (or, I suppose, grey swan, since he mentioned it).
Good Whitney Baker thread below on life insurance companies being stuffed "with private credit and direct lending, all using the same private ratings agency to misclassify the loans."
Banks seek out new buyers for Oracle data centre loans
“Banks are tapping investors such as insurance companies and private credit funds as they try to find buyers for tens of billions of dollars of loans tied to Oracle’s vast data centre projects.”
“At least $56bn worth of data centre construction loans — supported by the software company’s future leases as part of its $300bn deal with OpenAI — have been given investment-grade ratings, according to people familiar with the deals. These ratings, which are relatively rare for infrastructure construction loans, have allowed banks to attract a much broader base of investors than usual for project finance debt.”
On a related note, Jeff Snider discusses Oracle debt, Blue Owl, the BDC’s etc. here.
“This slow moving decline in the quality of credit could become an avalanche of decline... it looks like the patient is sick, and the patient that I am talking about is the CLO market.”
“Nobody’s buying a 30-year Treasury because they think it’s a good ‘investment’.”
Paging Hyman Minsky!
Green Shoots!
ISM Manufacturing PMI: Strongest Expansion Since 2022
Greg Weldon
On the trade deficit: “62 months out of the last 65…over five years of deficits $80 billion or more every single month…prior to that period, July 2020, you’d never had a single month above $80 billion.”
What are China’s top exports and imports?
Weldon: “They export phones, integrated circuits, computers, and cars. Top four…What are their top imports? Crude oil, iron ore, gold and copper.”
Weldon expects the dollar index to “theoretically” go below 70 (which would be very inflationary.)
And finally:
“If you get gold below $3500 and silver below $65, it’s one of those back the truck up moments. And what I mean is you back the truck up and fill it up as much weight as you can carry. So keep that in mind.”
Pending Home Sales
CMBS Delinquency Rate Increased to Open 2026 as Office Reached a New Record High
The Trepp CMBS Delinquency Rate increased again in January 2026, climbing 17 basis points to 7.47%. The increase was driven by a net increase in delinquent loans of almost $1.6 billion, primarily driven by the office sector. For the second straight month, three of the five major property types saw increases to their delinquency rates, while two pulled back, although the mix was different in January.
The largest rate increase was in office, which rose 103 basis points to an all-time high of 12.34%. The second largest rate increase was multifamily’s, which seesawed back up by 30 basis points in January to 6.94%, following a decrease of similar magnitude of 34 basis points the month prior.
The retail rate increased by 12 basis points to 7.04%, still 78 basis points off of its recent peak of 7.82% in March 2025, but the sixth monthly increase since the beginning of 2025.
The lodging rate saw the largest retreat, 105 basis points lower to 5.56%, down to its lowest level since March 2024 when the rate was 5.45%. The industrial delinquency rate broke its three-month streak of increases, dropping 18 basis points to 0.62%.
The “Spike of defaults was triggered by two huge Manhattan office towers.”
Old School Grantham
Demetri Kofinas: In the book, you say that even to this day, when you go to a restaurant, which I find somewhat hard to believe, but I take it at face value, that you still look for what is a bargain on the menu before you decide what to order. Is that really true?
Jeremy Grantham: It’s not only is it true, but I am shocked that you find it hard to believe. There are quite a few of us who do that, by the way. And it doesn’t matter whether we’re in the money or out of the money; it is a reflex, and it has more to do with waste. I don’t approve of spending large sums of money on superficial things like eating and drinking.
Rates “remain loose in real terms after inflation and historically, relative to same nominal GDP growth. So I think even this period now, you often hear about, we live at a period of high interest rates, but in fact, actually, historically, the monetary background, even of the current market, is relatively loose. I mean, it’s looser than, for instance, it was at the end of the dot-com bubble.”
Great takedown of Ben Bernanke, who was one of the worst things to every happen to America: “Explain to me how Bernanke could miss it. Explain to me how Bernanke’s reputation seemed to stay more or less intact”:
US, European car brands have lost $114B on EVs
Sorry it’s the New York Post, but still fascinating:
“Just two years ago, Mary Barra, chief executive of General Motors, declared: “We believe in an all-electric future.” She went on to claim that the challenges her company was facing in the EV market were merely temporary bumps on the road to net zero. But as Bob Dylan famously observed, things have changed.
On Jan. 8, GM announced it would take a $7.1 billion hit in charges against its earnings, of which $6 billion is due to Barra’s failed EV strategy. In a filing with the SEC, the company also warned that it would take more write-downs this year as part of a “strategic realignment of EV capacity.”
The car companies made 5.4 million EVs in three years — and incurred an astonishing $20,887 loss on each one.
GM’s move came less than a month after Ford Motor Co. announced it was taking a $19.5 billion write-down on its EV business. Ford has racked up a jaw-dropping $35.1 billion in losses on its EV misadventure, which raises the question: why on earth does Ford chief executive Jim Farley still have a job? Ford’s EV disaster will go down as one of the biggest fiascos in modern automobile history, yet Farley still took home $24.9 million in compensation in 2024.
It’s true that global EV sales are rising. Some 20.7 million EVs were sold last year, up 20 percent from 2024, but those numbers are misleading because nearly two-thirds of those EVs were sold in China. Of the 20.7 million EV units sold, China accounted for 12.9 million and Europe for 4.3 million. Meanwhile, North American EV sales totaled just 1.8 million last year, or 9 percent of the global total. Further, EV sales in the US grew by just 1 percent in 2025 and in Canada, they dropped by a whopping 41 percent.”
“I don’t think you need to be a Marxist to believe that inflation is a massively socially destabilizing phenomena.”
If you want to hear the China bull-case, listen to this.
From the Prologue of Maggie Mahar’s 2003 book, Bull:
In retrospect, Henry Blodget understood the role he had played in the bull market of the nineties. Sitting in a Greenwich Village café early in 2002, hereflected on his career.
“Have you ever read John Kenneth Galbraith’s book about the history of bubbles?” he asked, referring to the Harvard economist’s A Short History of Financial Euphoria.
“Well, I hadn’t—until recently. I just finished it,” Blodget admitted, with a pained smile. “It’s amazing how Galbraith spells it all out—what happens in every bubble, every time. He’s almost yawning as he lays it out: First some new thing comes along and captures the public’s imagination. Then everyone starts making money. After that, some person of average intelligence is held up as a genius.”
Blodget raised his hand: “Hi, that was me,” he said with a sardonic, half-embarrassed smile.
Blodget shook his head. “If only I had read that book at the beginning of 2000. It would have been worth a million dollars to me then.” For in his history of financial manias, Galbraith had predicted Blodget’s fate: “The [public’s] anger will fix upon the individuals who were previously most admired for their financial imagination and acuity.”
But even if Henry Blodget had read Galbraith’s book in 2000, he might not have recognized the full relevance of Galbraith’s story. For as the Great Bull Market of 1982 to 1999 reached a climax, only a handful of the actors onstage were ready to acknowledge that the longest bull market in U.S. history was coming to a disastrous end.
Roulette
Gamblers clustered around the roulette table at the El San Juan Hotel in Puerto Rico on 9 July 1959 were unmoved when the wheel spun and up came number 10.
When it came up a second time there was a ripple of surprise. When it happened for the third time, shock. The fourth – amazement. Fifth – mild hysteria.
The croupier spun again – again the ball dropped into the 10 slot. Pandemonium.
It was a roulette record. There had been no previous examples of six consecutive spins of the same number at any casino, anywhere. And it would be some while before an equally reputable sighting of a similar incident would take place.
This time, respected US gambling writer Barney Vinson was at Caesar’s Palace in Las Vegas on 14 July 2000 at 1.35 p.m., when the number 7 came up ‘six times in a row at wheel number 211. To figure the odds of such an occurrence, multiply 38 × 38 × 38 × 38 × 38 × 38, or over three billion to one. The dealer said it was the first time he had seen this in his 27-year career.’
When ‘7’ had been spun four times, the floor supervisor had said to the pit boss, ‘I’ll bet you a million dollars that it won’t come up again’ – but fortunately for him, no one took him up on his offer. Not only that, but after those six consecutive spins, asked Vinson, ‘How much money did table 211 lose? Hundreds of millions? Hundreds of thousands? Thousands? Nope –’ he revealed, in his casinocity.com column, ‘a mere $300!’
Maybe, though, the six-timer is not a record – my research produced a claim on behalf of croupier Liz Harlow-Smith that in September 1993, at the Stakis Club in Bristol, she spun the same number on seven consecutive occasions. ‘When the ball landed on the black four for the third time, I didn’t think too much about it. But it went on – it was amazing.’
Frank Scoblete writes a gambling column for the website casinocitytimes.com and he has recorded examples of roulette streaks. ‘Black was said to have come up twenty-three times in a row at the Imperial Palace in Las Vegas in the early nineties.’
I found this commentary to be troubling, but I can’t really argue with it:
Let me make this ABUNDANTLY CLEAR…
Trump WOULD NOT be invited personally by BlackRock CEO Larry Fink as the “keynote speaker” at the World Economic Forum in Davos if he wasn’t ALL IN on their agenda.
This is COMMON SENSE.
I said it before, and I’ll say it again…
You DO NOT get invited as a “KEYNOTE SPEAKER” anywhere unless you are a GUEST OF HONOR.
It is totally LUDICROUS to assume that Trump and his admin would get access to the WEF just to berate them, and “take them down”…
Like Klaus Schwab said here: “We penetrate the cabinets” and if you look at many of the people that Trump has aligned himself with both in and out of the admin, they are DEEPLY embedded with the WEF.
If Trump was REALLY serious about bypassing the WEF and their agenda, he would simply IGNORE them, and pretend they didn’t exist…But no, instead he palls around with many current members of the WEF, invites them to tax payer funded dinners at the White House, and is invited as a KEYNOTE SPEAKER to announce the “Board of Peace” which also has many WEF members…
Just a few examples…
Peter Thiel & Alex Karp from Palantir, as well as Tony Blair, Bill Gates, Albert Bourla, Sam Altman, Larry Ellison and of course his best bud Larry Fink, who is now running the WEF, are great examples of this. So is Maria Corina Machado, who just gave him her Nobel Peace Prize, so she can lead Venezuela.
Trump could literally say in his speech that he wished a drone strike would hit Davos, and it would just be THEATER.
IT IS ALL THEATER.
Any “contention” you see happening is 100% THEATER.
It is a REBRANDING of “The Great Reset”.
This time it’s the American-led NWO “Golden Age” and Trump is the chosen Trojan Horse.
“There is really no automatic machinery, not on this earth at least, which causes justice to happen automatically. Men have to make it occur, individual human beings have to make it occur, otherwise it doesn’t come into existence, and this is not always easy. As a matter of fact, it is always hard, because justice presents a threat to power, and in order to make justice come into being you often have to fight power.”
From Jim Garrison's closing arguments at the Clay Shaw trial, 1969
“If once public opinion is convinced that the increase in the quantity of money will continue and never come to an end, and that consequently the prices of all commodities and services will not cease to rise, everybody becomes eager to buy as much as possible and to restrict his cash holding to a minimum size.
For under these circumstances the regular costs incurred by holding cash are increased by the losses caused by the progressive fall in purchasing power. The advantages of holding cash must be paid for by sacrifices which are deemed unreasonably burdensome. This phenomenon was, in the great European inflations of the ‘twenties, called flight into real goods (Flucht in die Sachwerte) or crack-up boom (Katastrophenhausse).” - Mises, Human Action
So funny story. I worked
in the Dow Jones’s newsroom when Paul Steiger had everyone wearing those ridiculous black, Dow 10,000 hats and shirts. They all looked ridiculous to me then as they do now.
"silver below $65, it’s one of those back the truck up moments"
Weldon coming in with the timely advice. Need to remember to listen to his episodes the moment they drop.
Also, my last new car *cost less* than what GM is losing on each EV!