Tag: economy

The War in Iran Comes Home to ‘Trump Country’

“It’s not tariffs… it’s the war, it’s gas prices, it’s diesel.”

In leaked audio obtained by Axios, Ken Paxton, the Republican nominee for senate in Texas, spoke candidly about what he believes are the biggest issues hurting his campaign. The Iran war, which has dragged on for almost eight months now, has put Texans – and the rest of the nation – in an economic bind, one which President Donald Trump had promised to avoid.

Crude oil prices have once again risen above $100 a barrel. The national average for gasoline is hovering above $4. With Republicans nationwide being burdened by the stench of incumbency – regardless of whether or not the individual candidate is currently in office – a return-to-power seems all but imminent for the Democrats in the House of Representatives, and maybe even the Senate as well.

This is even true in “Trump Country.”

The war itself is a topic which evokes hardline opinions on both sides. Fierce debates have been had in elite circles over the wisdom of launching the military campaign against Iran, the strategic blunders of the Trump administration, and the way in which the war has been conducted. What has been a bipartisan concern, however, is the rise in fuel prices brought upon by the war.

People en masse may not know the technical details of the raging conflict in the Strait of Hormuz, or even where to find it on a map. What they do know is that when they turn on social media or turn on the TV, the campaign ads they see coming from Democrats consistently associate the skyrocketing fuel prices with the war in Iran – attaching the Republican opponent to the White House’s unpopular war.

Meanwhile, the rebuttal from Trump isn’t an explicit denial of these accusations. Rather, he has embraced them.

“It’s a small price to pay,” Trump said at a rally in Alaska on October 14, “for stopping [Iran] from having a nuclear weapon.”

Trump’s fanbase, collectively referred to as “MAGA,” have been known for their unwavering loyalty to the president. Trump famously joked in a 2015 stump speech “I could stand in the middle of Fifth Avenue and shoot somebody, and I wouldn’t lose any voters.” The spirit of this has been generally correct. On most issues, Trump’s supporters have stuck with him regardless of his many contradictions – be it on the Epstein files, government spending, or the merits of various DC swamp creatures.

There has been a crackup, though. Trump’s swagger – his inability to disgust his diehard fans even if he tried – seems to be weakening.

The Iran war, while historically unpopular, isn’t the sole reason for this. Neither is his baseline hawkishness, which contradicts his dovish campaign rhetoric. The majority of Republicans were happy to support Trump’s January 2026 operation in Venezuela, and most also approved of the bombing of various small boats off the coast of Central and South America. But this war had a different effect on Trump’s coalition than the one in Iran.

For one, the Venezuela operation was relatively limited in its scale, and the same can be said for the boat strikes. The fighting in Caracas lasted mere hours and resulted in no American casualties. President Delcy Rodríguez’s regime has remained in power, and blowback – at least in terms of significant negative ramifications – has not been felt in the U.S. to this point (that doesn’t mean it won’t appear in the future, to be clear).

Most importantly, the economic impact of the operation wasn’t notable. There weren’t any immediate concerns about twenty percent of the world’s energy supply being stuck behind a missile-riddled waterway, for example.

The situation has been exactly the reverse in the Middle East.

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How Government Intervention Destroys Markets and Mandates Scarcity

The systematic erosion of purchasing power over the last few decades has coincided directly with a devastating decline in living standards for middle-class wage earners and prudent savers alike. You can visibly see it in most cities across America.

Areas that a generation ago were nice, clean neighborhoods are now blighted and decayed. Those with the means to do so moved on long ago. Those who remain are left with the ugliness.

But that’s not all. As we recently noted, when central planners intentionally debase a currency, they don’t just erode hard-earned savings; they tear apart the very moral fabric of society.

From revolutionary France’s catastrophic reliance on paper assignats to the modern Federal Reserve’s relentless balance-sheet expansions, the ruinous playbook never changes. Hard work and patient, disciplined saving are gradually replaced by financial desperation and wild, speculative gambling.

And once a populace begins to feel the suffocating squeeze of rapid dollar debasement, they look for someone – anyone – to stop the bleeding. They don’t typically point their angry fingers at the central bank or the reckless spending sprees in Washington. Instead, they look at the retail checkout counter, wrongly blaming local merchants and business owners.

They demand immediate, forceful relief from high prices. And opportunistic politicians, eager to avoid blame for the inflation they created, are more than happy to offer the brainless, counterproductive solution of government-imposed price controls.

Here in the USA, and across the entire planet, we’ve arrived at a dangerous and muddled place where the appetite for heavy-handed government intervention has crossed party lines entirely. Unaware that state-sponsored dollar debasement is the real thief in the night, everyday citizens are crying out for the state to slap artificial price caps on basic necessities.

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Argentina’s economic demolition: Javier Milei disappears 11 TONS of gold

Despite being one of Donald Trump’s biggest political investments in Latin America, or perhaps because of it, Argentine President Javier Milei is presiding over a deepening recession. His country’s industrial base is crumbling, the middle class is shrinking, and factories keep closing. Yet Milei’s grip on power has only tightened with the help of powerful patrons in Washington and Tel Aviv.

Now, a new scandal has erupted which raises troubling questions about the fate of the nation’s wealth.

On October 8, National Audit Office president Juan Manuel Olmos confirmed that Argentina’s Central Bank lost $1.023 billion in gold reserves through operations that moved physical gold out of the country without the public’s consent.

The financial loss may be only part of the story. Nearly 11 tons of Argentine gold are unaccounted for. How the gold bars left the country, where they are now, and whether the government can recover them all remain open questions.

Beyond the missing gold lies a larger issue: what will remain of Argentina’s national wealth, industrial capacity, and economic sovereignty when Milei’s experiment ends?

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Ottawa’s Counter-Tariffs On US Costing Canadians $100 Million Weekly, Economist Says

Canada’s retaliatory tariffs on U.S. imports are costing consumers an estimated $100 million a week and raising prices by about 0.25 percent, an economist told MPs.

University of Calgary economics professor Trevor Tombe testified before the House of Commons foreign affairs committee on Oct. 21 about the counter-tariffs that Ottawa imposed on $28 billion of American imports on Sept. 8, in a tit-for-tat response to American tariffs that took effect Aug. 22.

The retaliatory tariffs ranged from 15 percent on U.S. farm equipment and appliances to 25 percent on construction supplies and 50 percent on smartphones, furniture, aluminum, and steel.

Tombe told MPs that Ottawa’s retaliatory tariffs cut half a percentage point from the disposable income of Canadians making under $30,000 a year and increased consumer prices “across the board” by roughly 0.25 percent, as first reported by Blacklock’s Reporter.

“Just for consumers, not even for businesses, it’s about $100 million per week of additional costs,” he said.

“Those costs might be worth paying if one is making an argument that there are non-economic objectives that these tariffs achieve,” he added. “I don’t know what those might be. … So, I’d say the economic case for retaliation is thin.”

The federal government has said it is applying counter-tariffs on the United States to shield domestic producers amid U.S. tariffs, and to also apply pressure on the White House to remove its tariffs.

“We’re also targeting products that will target states in the U.S.,” Industry Minister Mélanie Joly said in August.

“We’re being wise and strategic to put political pressure, and that’s why we think it’s the right thing to do right now.”

Tombe said a better way to understand the U.S. tariffs is that they are really an “American domestic policy rather than a bilateral dispute with Canada.” Furthermore, he said Ottawa’s retaliation only adds costs for Canadian consumers, while its effect on American policy “appears to be quite limited.”

He called the U.S. tariff increases “the largest trade policy change” in the country’s 250-year history.

He said the average U.S. tariff globally was 2 percent in 2024, then it jumped to 30 percent in 2025 before falling to an average of 11 percent. He put the average U.S. tariff on Canadian goods at 8 percent, lower than rates faced by 93 other countries.

“So this may be less of a trade war with Canada than a fundamental change in how the United States runs its economy,” Tombe said. He said a tariff essentially equals a domestic consumption tax plus a production subsidy of the same rate.

Tombe said Canada’s 2025 retaliatory tariffs generated $4 billion in federal revenue over six months.

He added that it’s difficult for a small country’s tariffs to meaningfully affect the target country’s economic costs, especially one as big as the United States.

“There’s no evidence that the retaliation we’ve enacted has changed U.S. behavior,” he told MPs.

Tombe said that “Canada faces something of a trilemma,” since it wants to retaliate by targeting goods from politically important states, goods where Canadian companies are major buyers, and goods where Canada can easily substitute for other things.

“And doing all three is quite difficult,” he said, noting that a tariff package meeting all those objectives would be roughly one-tenth the size of a full dollar-for-dollar retaliation.

Tombe also said Ottawa’s counter-tariff package didn’t actually follow through on dollar-for-dollar retaliation; instead, it was about 60 cents for every dollar.

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The Energy Crisis Escalates: The Dual Threat Of More War In The Middle East And Hurricane Isaias Damaging U.S. Refineries In The Gulf Is Pushing Oil Prices Even Higher

Just when it seemed like we had hit a period of relative calm, global events are starting to accelerate again. Within the past 24 hours, there have been a couple of absolutely enormous developments. First of all, Tropical Storm Isaias has become Hurricane Isaias and we are being told that it will make landfall along the Gulf Coast. That is potentially a major problem because the Gulf Coast accounts for over 50 percent of the crude oil refining capacity in the United States. If any of that capacity is taken offline for an extended period of time, that will drive fuel prices substantially higher. Meanwhile, Iran has been attacking tankers at a very alarming pace this week, and President Trump is reportedly considering a new wave of airstrikes on Iran…

This is a major bombshell.

If the U.S. starts extensively bombing Iran again, the war in the Middle East could spiral completely out of control.

The good news is that President Trump is now pledging that the U.S. will not be bombing Iran until after the midterms…

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Gen Z Is Broke and Fed Up With Politics

At Thanksgiving last year, a great-aunt tried to offer Kayla Cornett a reassuring example: Her older cousin had worked hard, saved and bought a house. Cornett, 24, could do the same, she said — if she tried just a little bit harder.

What stayed with her long after the turkey was cleared was the implication that her current efforts just weren’t enough. She was trying to keep up with rent and the ordinary expenses of adulthood, and it was a struggle. She recently started carrying a credit-card balance for the first time, she says, after even modest costs began piling up. Filling her gas tank was $40. “I can not eat, or I can have credit card debt,” she remembers thinking when older relatives questioned her balance.

Cornett and her partner have stayed in their Raleigh apartment even as the complex has grown less safe and cars have been broken into. They had moved in 2023 and were reluctant to do so again; other places now cost $200 or $300 more per month. Leaving would mean trading one worry for another bill they can’t afford.

“The little things are accruing in a way that feels insurmountable to me,” Cornett says.

The affordability crisis is a struggle felt by everyone in the country, but it’s hitting Cornett’s generation particularly hard as they emerge into adulthood with high inflation, little savings, a wobbly job market and a lifetime of dysfunctional politics. Transunion, a consumer credit reporting agency, found in a 2024 study that 22- to 24-year-olds in Gen Z had higher average credit-card balances, higher average auto-loan balances and higher average personal-loan balances than millennials of the same age a decade earlier, even when adjusted for inflation. Gen Z borrowers also had higher delinquency rates than their millennial counterparts.

This gap — between the promise that hard work will bring stability and the costs young adults say they can’t get ahead of — is key to understanding the politics of Gen Z, a voter group that helped President Donald Trump win in 2024, but whose longtime loyalties have yet to be won by either party.

After Trump’s victory, much was made of a vibe shift in American politics. The manosphere was ascendant and tradwives were everywhere. For a brief moment, it seemed like conservatives had captured the attention of American youth. Perhaps. Or perhaps Trump pulled in young voters because of his promises to rein in high prices, and since he failed to do so — amid his tariffs and his war with Iran — young people are preparing to reject the GOP in droves in the midterms.

Gen Z’s political behavior is often viewed through the lens of cultural issues or internet trends. But based on a dozen interviews with Gen Zers from across the country, those explanations obscure a more fundamental force: They belong to a generation coming of age with less financial security and with a growing sense that the American economy doesn’t deliver, at least not for them. A crushing debt load is the most tangible proof.

“The first time I voted was the 2024 presidential election,” says Anna Yi, a 21-year-old Democrat studying at the University of North Carolina-Chapel Hill. “I remember being a little bit naive and being like, ‘There’s going to be a lot of change. There’s going to be a lot of sweeping social reform and whatnot.’ Now it’s: Who’s going to get me a job? Who’s going to let me afford my own place before I turn 40?”

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Two Decades Of Mass Financial Delusion Ends Now

Friday’s selloff was not a surprise.

Between deteriorating credit markets, rising Treasury yields, increasingly absurd artificial intelligence valuations, enormous amounts of leverage and an entire financial system that has spent the better part of two decades mainlining cheap money like a frat guy guzzling Jaegermeister at the bottom of an ice luge, the warning signs have been flashing for quite some time.

The only real surprise, at least to me, is that it’s taken this long for equity investors to begin paying attention. And what worries me most isn’t how far stocks could fall, but how spectacularly unprepared investors are to deal with a market that actually goes down and stays down.

I want to start with something I read on CNBC this morning, because I think it perfectly encapsulates the extraordinary complacency and all around ignorance that exists on Wall Street. Discussing whether increased debt issuance could become a systemic problem, Michael Rosen, chief investment officer at Angeles, offered the following assessment:

“The question is: Is this a systemic issue? Obviously, increased debt issuance is something to observe and continue to watch and be concerned about if it continues to get to levels of excessiveness. But we’re not remotely close to that right now.”

I’m sorry. What? We’re not remotely close to excessive debt issuance?

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The Biggest Winners And Losers From The Petrodollar’s Decline

The Iran war is straining US weapons stockpiles and raising doubts about Washington’s ability to protect the Persian Gulf.

If that weakens the petrodollar and pushes oil producers away from the US financial system, two assets face clear headwinds: the US dollar and US Treasuries.

The petrodollar system helped create structural demand for both.

If oil exporters sell more energy outside the dollar system, fewer oil dollars need to flow back through Wall Street and into Treasury securities.

At the same time, the US government needs to borrow staggering sums to finance its deficits, military commitments, entitlement programs, and interest expense.

That means rising supply of Treasuries could collide with weakening structural demand.

Watch the 10-year Treasury yield.

The 10-year Treasury yield is perhaps the most important financial benchmark in the global fiat system, as it drives valuations and market trends worldwide. It is widely – and erroneously – regarded as the risk-free rate of return.

The 10-year Treasury yield can be thought of as a key barometer of the US dollar-based fiat system – a critical measure akin to its beating heart.

Bond yields move inversely to bond prices. When bond prices fall, bond yields rise.

A rising 10-year Treasury yield signals trouble for the US dollar because it means investors are selling Treasuries, which pushes up the US government’s borrowing costs. That is why the 10-year Treasury yield is a major pain point for the US government.

The 10-year Treasury yield was 3.97% in late February 2026. Now it is around 5.26%, an increase of roughly 129 basis points. 129 bps might not seem like much, but with over $40 trillion in debt and growing, every basis point matters.

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GOP Spending Swells US Deficit to Nearly $2 Trillion for 2026

The Treasury Department released its monthly statement on Friday and has now confirmed what we all suspected: the US federal government, under the Trump Administration, will finish the 2026 fiscal year with an annual fiscal deficit of about $2 trillion.

To be precise, the federal deficit for the 2026 fiscal year, which ended on September 30, is $1.99 trillion. That’s the third largest deficit ever recorded. From fiscal year 2025 to 2026, the deficit grew by 12 percent and that’s the largest growth rate since 2023. Last year, the federal deficit was $1.84 trillion, which was slightly smaller than the 2024 deficit of $1.95 trillion.

Even when adjusted for CPI inflation, however, 2026’s deficit remains the third largest ever, even including the Second World War, when the deficit in 2026 dollars reached an eye-watering $1 trillion.That was considered an off-the-charts deficit at the time. Today, World-War-Two style spending looks quaint compared to Covid-era spending and the past two years of Trump deficits.

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Next Stop 6 Percent – The Treasury Bond Crisis Is Officially Out Of Control, And It Is Starting To Look A Lot Like 2008 All Over Again

A historic Treasury bond crisis has erupted and hardly anyone that doesn’t work in the financial world has any idea what is actually going on. We are literally witnessing the most dramatic financial crisis since 2008, and it isn’t even on the radar of most people in the general population. But it soon will be, because it is going to have tremendous implications for all of us. Economic conditions were very painful for several years after the financial chaos of the fall of 2008, and it appears that we are headed for a similar scenario now.

When average people on the street hear that bond yields are going up, most of them think that must be a good thing.

But bond yields and bond prices move inversely to one another, and so when bond yields are spiking that means that bond prices are crashing.

And when bond prices crash, that is not good at all.

Investors were waiting to see whether or not the yield on 10 year U.S. Treasury bonds would smash through the 5 percent barrier, and that is precisely what happened.

Subsequently, investors have been closely watching the 5.25 percent barrier, because historically that is when market conditions really begin to go haywire…

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