USD Swap Lines Weaponized: Past Freeze Boosted CIPS, Gold
RE: “Weaponizing USD swap lines” - last time the USD system rails were weaponized (2022 Russia FX reserves frozen), CIPS payments more than doubled in 2 years, and gold rose 3x in 4 years. Let’s watch. https://t.co/ydeBLxbx6r
UAE USD Swap Lines May Fund China Investments
So…will the USD swap lines Bessent is going to give UAE going to finance the UAE’s newly-signed investments in China? Or are the USD swap lines so UAE doesn’t have to sell USTs to make these investments in China? Or do the...
Bessent's Swap Lines Risk Accelerating US Deindustrialization
Unless Bessent also extends “permanent swap lines” to the US defense industrial base, this would only accelerate the de-industrialization of the US. Why invest in manufacturing in the US while Bessent is giving cheap USDs to support lower cost competitors around...
China Shifts Commodity Payments to CNY, Sidelines USD Crisis
It matters greatly, here's why: 1. China can run out of USD, but it can't run out of CNY. 2. China's biggest USD outflow is in commodity imports - est. $1.5-2.0 trillion in commodities, mostly in energy. 3. So every 10% of their...
Iran Conflict Heightens Threat of Losing Iraq War 2
Translation: As a result of the Iran War, we are at increasing risk of losing Iraq War 2.
UAE Threatens Oil Trade Shift to Yuan over USD Shortage
UAE to Trump Administration: "You started this war; if we run short of USDs as a result of it, either you will give us USD swap lines, or we will be forced to start transacting oil and gas in CNY...
China Vows to Weaponize Oil Embargo Against US
American strategists: “We are going to cut off China’s oil, thereby wrecking China.” China’s response? Geopolitical/oil politics version of Good Will Hunting: “Give us the wrench…because f*ck them. That’s why.”
US Oil Exec Would Slash Capex Amid Hormuz Price Gap
If I was a US oil exec witnessing how Hormuz’s closure for 7 weeks (& counting) has left US oil prices far below global prices while E&P stocks (XOP) have underperformed SPX since March 2, I’d cut 2026 capex, lay...
S&P 2002 Bottom Yields 1156% Gain, Gold Lags
Since the bottom in the S&P 500 in 3q 2002: SPX Total Return (blue): Up 1,156% SPX Total Return priced in gold (red): Down 17.5% https://t.co/Ar8IPnAqOe
Gold-Oil Ratio Soars, SPX Tied to Gold
Since Trump 2 Inauguration in January 2025: Left chart: Gold/oil ratio (red), oil (blue.) Right chart: SPX (blue); SPX priced in gold (red.) Trump keeps calling everything "golden"; maybe he's trying to tell us something🤔 https://t.co/0AihVavwpP
Paulson Warns of Imminent Vicious Bond Market Crash
Henry Paulson Says US Should Prepare for a ‘Vicious’ Bond Crash - BBG, 4/16/26 Conspicuous in its timing, IMO. "Why am I reading this now?" https://t.co/odjQGdaGW5
Yield Gaps Reveal Overlooked Oil Supply Risks
Orange: UK 10y yields Blue: US 10y yields Light Green: German 10y yields Dark Green: Japan 10y yields Red: China 10y yields 2008 to today. Everyone is focused on sovereign oil supplies; no one is considering oil supplies in context of the chart below. Big mistake...big...yuge https://t.co/BrA762Bo13
China Halts Exports From Plastic Trinkets to Missile Magnets
Bessent: “China is stopping exports of various products” Products like “plastic trinkets”, or products like “the rare earth magnets we need to rebuild our missile stockpiles to continue our war v. Iran”? 🤔
US Misunderstands Existential Threat to China, Russia, Iran Supply Chains
100%. Virtually no one in US seems to understand a) This is existential to China & Russia as well as Iran b) What that potentially implies for global supply chains
Freight Rail
AAR Freight Rail Index (carloads ex-coal & grain) better sequentially, but still down slightly v. 2018 & only up marginally v. 2014. https://t.co/hkyyyWZbjr
Hormuz Closure Threatens Global Supply Chain Collapse
We said if Hormuz stayed close until mid-April, global supply chains were mathematically certain to begin collapsing, including in the US. Right on cue, on April 10👇 Things will rapidly get much worse from here if Hormuz stays closed “What’s the trade?” =...
China, Russia Threaten Retaliation if Iran Is Flattened
1. Then open the waterway. 2. Tell us what China and/or Russia have threatened in retaliation for flattening Iran. https://t.co/0WWO6gawpE
Gold, Not Currency, Will Dominate Future Reserves
"But what currency will replace the USD in global FX reserves?" -Question I've been asked repeatedly over the past 10 years. "No currency will...gold will." -My answer every time over those 10 years. What if the currency system...
10‑Year Yield Above 4.4% Proves Unmanageable
Well that is a problem given that in the last couple weeks, the MOVE Volatility Index and US policymakers’ actions (TACO’d every single time 10y hit 4.4%) empirically showed that the US & world cannot handle >4.4% on the 10y. #YouDownWithYCCYeahYouKnowMe
Conflict Outcomes Remain Uncertain, Like Schr
Given "Schroedinger's ceasefire" and "Schroedinger's Hormuz re-opening", thought this was a potentially instructive chart from @johnauthers, via @Bloomberg. #HistoryRhymes https://t.co/86srIVeKMI
First 60 Pages Reveal the Unseen Sprint Ahead
If you want to know the path we are now sprinting down, read the first 60 pages of this book. The Brits never saw it coming either, until it was too late. https://t.co/oX1NeGWhO7
Ohio Guard F‑16 Wing Conducts Week‑Long Night Flights
US Air National Guard F-16 fighter wing in Ohio conducting night flying operations all this week 🤔 Source: WTOL https://t.co/H3RjUL5aUQ
Unexpected Twist Challenges Narratives on China's Gold Sales
Big non-sequitur to multiple narratives in March about official gold selling & China's level of desperation. 👇
Putin’s Eurozone Bid Once Threatened US‑Europe Ties
Here’s another one: Many on X seem to forget that Europe also tried to separate from the US 16 years ago, when Putin said Russia would join the Eurozone, which would have married Russian energy with German engineering, a combo...
EU Tried Pricing Iraqi Oil in Euros, US Halted Independence
Many on X seem to forget that Europe tried to separate from the US 26 years ago, when the EU arranged for Iraq to sell oil in EUR instead of USD (Source: CNN Int’l👇) The EU would have been independent of...
Innovation Requires Production: Rethink USD Reserve for Reindustrialization
“To innovate, you must make.” -INTC CEO Andy Grove, 2011 The reality is we cannot and will not reindustrialize unless we change USD reserve status structure to a system with a neutral reserve asset instead of USTs; it’s a fundamental double-entry...
BTC's March Resilience Stems From February Crash Rebound
I've been surprised by the resilience of BTC over the last month. Initially I thought it might be being bid by flight capital out of the Mideast, but when I look at BTC v. software (IGV), it looks more like BTC...
Gold Leads US Exports, Offsetting Trade Deficits
The US’ single biggest export in February was “non-monetary gold.” Gold has been the US’ biggest export in 4 out of the past 5 months (it was the 2nd biggest export in the 5th mth.) Trump is partially settling US trade deficits...
COVID's Shutdown Cut Oil Demand 9%; Deeper Cuts Impossible without Crisis
In COVID oil demand was down 9.2% y/y. All it took was shutting down much of the economy & handing out stimmy’s. You think we can shut the economy more than COVID, with no stimulus and without stock & bond markets, banking...
Iran Turns to Euro, France Pays in Yuan
Iranians accepting EUR....or French paying in CNY (after selling gold to China to get CNY)?
Gold Sellers Beware: Iran's CNY Deal Triggers Arbitrage
They’ll hold a meeting, realize they can’t open it if the US couldn’t, & then just agree to pay Iran in CNY… …and the easiest/only way to secure CNY is by buying physical gold in USD and selling that gold to...
Logistics, Not Tactics, Determines Missile Priority Amid Chinese Supply Crunch
More evidence US and Israeli interceptor missiles are running down faster than Iranian offensive weapons US, Israel, & Iran are all dependent on China’s factory base to replenish their missiles. Who gets priority? Logistics > tactics.
Critical US Grid Insight Over
This fact has been emphasized to me for years by execs at a US private electrical infrastructure I have an investment in… …yet it is ignored by most geopolitical analysts and policymakers because it is too inconvenient to acknowledge: https://t.co/CODqrwbKm1
Beijing’s 2002 Strategy Exploited US’s War on Terror
Left: "Much of Beijing's current strategy toward the US was laid down in 2002, when the CCP concluded China faced an unprecedented 20-year 'period of strategic opportunity' [due to] the GWOT distracting US leaders." Right: Cover of this week's The Economist...
Supply‑chain Disruptions Are only Now Fueling Inflation
…and the inflation from global supply chain breakdowns that have already begun have likely only just begun being reflected. 😳
Graham’s Shift Signals Trump’s Hidden 4‑D Iran Strategy
Why is Lindsey Graham (arguably the warmonger-in-chief of the Iran war) now advocating for “winding down” the Iran war, given that by all accounts, it is an elaborate 4-D chess play by Trump that is going according to plan or...
Foreign Central Banks Cut UST Holdings to 2012 Low
"Foreign central bank holdings of USTs at NY Fed fall to lowest level since 2012 in wake of Iran war" Via @seaniechaos https://t.co/VIiwJqrZAY
New Iranian Regime, Yet Hormuz Remains Closed
So Iran is “defeated” (per Karoline Leavitt yesterday) with a “new and more reasonable regime” in charge…and yet Hormuz is still not open? 🤔 https://t.co/HQqiKfhcrY
Weekly Market Cycle: Optimism Monday, Panic Wednesday, Crash Friday
Interestingly, last week multiple senior fund managers pointed out to me that this pattern has held for each of the last 3 weeks: “TACO/positive news” Monday, “uh-oh” by Wednesday, “dumpster fire” by Friday
10‑Year Treasury Yield Signals Oil’s Impending Downturn
Sec. Bessent, February 2025: "Judge us by the 10y UST yield." 10y UST yield (blue, RS) v. oil, since Bessent said that 👇 "3 Arrows" about to turn into "0-for-3 Arrows": https://t.co/goqhygmgv6
US Food and Energy Self‑sufficiency Is an Illusion
US is "self-sufficient in food & energy"... ...but US food & energy supply chains are now HIGHLY centralized, fragile, & long (& usually stretch back to China.) "US is self-sufficient in food & energy" is like the man who drowned in a...
Hormuz Closure Likely Drives 10‑Year Yields Higher
As long as Hormuz stays closed (which is highly likely near term), 10y UST yields will likely keep rising until either Fed or Treasury are forced to inject USD liquidity (into an oil spike & increasingly fracturing global supply chains)...
U.S. Bases in Gulf Largely Uninhabitable, Kuwait Worst
“Many of the 13 military bases in the region used by American troops are all but uninhabitable, with the ones in Kuwait, which is next door to Iran, suffering perhaps the most damage.” -NYT just now First MSM admission I’ve seen of...
2019 Book Predicted Missile‑Drone Dominance
2019 book that predicted the “missiles + drones > naval ships” dynamic we are watching play out in real time in Hormuz. Martyanov’s warnings apparently fell on deaf ears in DC unfortunately. https://t.co/4nsMkPDhTm
Hormuz Closure Threatens World Economy, Outweighs US Strikes
...and yet Hormuz remains closed. The US bragging about how many targets we've hit in Iran while Hormuz remains closed is the geopolitical equivalent of "Every kid gets a trophy", because Hormuz closure means the world economy is on the clock. Another...
Trump Hints at Hormuz Delay Due to Rapid Interceptions
One of the charms of Trump is that he will sometimes tell you what is really happening if you read between the lines. For example, here he all but told us the real reason Hormuz isn't open yet. I would think interception...
US Yield Rise Threatens Debt Spiral Amid Oil Tensions
Update: 10y UST yields (blue, RS1) USDJPY*oil (red, LS) USDCNY*oil (green, RS2) Hormuz is still closed; China still has several years of oil inventories; 10y UST yields are ~20-30 bps from triggering a US & global debt spiral. What happens first? Let's watch. https://t.co/ixdOHnatCg
Long-Term Treasuries Turn Risk‑On, Driven by Hedge‑Fund Basis Trades
LT USTs are now a "risk-on" asset: 10y UST yields UP on risk-off, DOWN on risk-on. This is the price action you would expect when 37% of net issuance of UST notes & bonds since 2022 have been bought by "Cayman...
US Debt Surge Mirrors 1980s Argentine Crisis
In 1973, US debt/GDP was 31%...today it's 122%. US fiscal deficit/GDP was 1%...today, it's 6% on its way to 8-10% (or more if the war drags on.) Translation: "That 70s Show" will feel like "1980s Argentina with US characteristics."
Long‑term UST Holders Lost ~80% Purchasing Power
Joke's on you - anyone that has owned LT USTs for the past 10 years has already had their purchasing power destroyed (ZB priced in gold down ~80% since global CB's stopped buying USTs on net in 3q14 & ramped...