There are two ways to be fooled. One is to believe what isn’t true; the other is to refuse to believe what is true. —Soren Kierkegaard. "…truth is true even if nobody believes it, and falsehood is false even if everybody believes it. That is why truth does not yield to opinion, fashion, numbers, office, or sincerity–it is simply true and that is the end of it" – Os Guinness, Time for Truth, pg.39. “He that takes truth for his guide, and duty for his end, may safely trust to God’s providence to lead him aright.” – Blaise Pascal. "There is but one straight course, and that is to seek truth and pursue it steadily" – George Washington letter to Edmund Randolph — 1795. We live in a “post-truth” world. According to the dictionary, “post-truth” means, “relating to or denoting circumstances in which objective facts are less influential in shaping public opinion than appeals to emotion and personal belief.” Simply put, we now live in a culture that seems to value experience and emotion more than truth. Truth will never go away no matter how hard one might wish. Going beyond the MSM idealogical opinion/bias and their low information tabloid reality show news with a distractional superficial focus on entertainment, sensationalism, emotionalism and activist reporting – this blogs goal is to, in some small way, put a plug in the broken dam of truth and save as many as possible from the consequences—temporal and eternal. "The further a society drifts from truth, the more it will hate those who speak it." – George Orwell “There are two ways to be fooled. One is to believe what isn’t true; the other is to refuse to believe what is true.” ― Soren Kierkegaard
Treasury Secretary Scott Bessent has just declared open season on government waste, fraud, and abuse. The message to the swamp is clear: We are coming for you, and we are paying your colleagues to help us do it.
On Friday, the U.S. Department of the Treasury announced the launch of a new whistleblower initiative aimed at rooting out fraud, money laundering, sanctions violations, and abuse of government benefits.
As part of the program, Treasury will establish a dedicated website where whistleblowers can confidentially submit information about financial misconduct and taxpayer-funded fraud operations.
“Treasury is strengthening the fight against fraud, money laundering, and sanctions violations. Today, [Financial Crimes Enforcement Network (FinCEN)] launched a webpage to confidentially accept whistleblower tips, which may lead to financial rewards,” Treasury Department announced on X.
In a statement, Bessent said, “President Trump has been clear that Americans have a right to know that their tax dollars are not being diverted to fund acts of global terror or to fund luxury cars for fraudsters. At Treasury, we follow the money. We did it with the mafia, we have done it with the cartels, and we’re doing it with the Somali fraudsters. We are going to offer whistleblower payments to anyone who wants to tell us the who, what, when, where, and how this fraud and money laundering has occurred.”
President Trump has been clear that Americans have a right to know that their tax dollars are not being diverted to fund acts of global terror or to fund luxury cars for fraudsters. At Treasury, we follow the money. We did it with the mafia, we have done it with the cartels, and… https://t.co/YRP9pzgJ3n
— Treasury Secretary Scott Bessent (@SecScottBessent) February 13, 2026
But here’s where things get serious.
Bessent made it clear that this is not just another bureaucratic “report it and forget it” program. Americans with inside knowledge of fraud will now have a direct financial incentive to expose wrongdoing:
“We are encouraging whistleblowers who know about fraud—people who are stealing from the American taxpayer—to come forward. At Treasury, we’re setting up a website, and we will be giving rewards of up to 10% to 30% of the fines that we levy.”
That means individuals who provide actionable intelligence that leads to successful enforcement actions could walk away with a massive payday, potentially receiving between 10% and 30% of the fines imposed on those defrauding American taxpayers.
According to Treasury officials, the initiative will be administered through FinCEN’s Office of the Whistleblower and will focus on violations tied to the Bank Secrecy Act, U.S. sanctions programs, and other financial laws critical to protecting the integrity of the American financial system.
WATCH:
BREAKING 🚨Sec Scott Bessent stuns America by encouraging whistle blowers to expose fraud. They will receive 10-30% of the fines
Look out below, because the dam is beginning to break. Many of us were projecting that our economic problems would accelerate during the early portion of 2026, and that is precisely what has taken place. Employers are conducting brutal layoffs all over the nation, the number of job openings continues to decline, stores and restaurants are closing everywhere we look, and now cryptocurrencies are crashing hard. We haven’t seen anything like this since the Great Recession, and the worst is yet to come.
According to Challenger, Gray & Christmas, so far in 2026 the number of announced layoffs is the highest that we have seen since 2009…
Employers announced 108,435 job cuts in January, the highest tally for the first month of the year since 2009, according to a report out Feb. 5, and a sign employers may be taking defensive steps against economic uncertainty.
The report, from global outplacement and executive coaching firm Challenger, Gray & Christmas, mirrored other data released Feb. 5 that suggested the labor market is cooling. Unemployment benefits claims rose in the most recent week, and job openings slipped in December.
“Generally, we see a high number of job cuts in the first quarter, but this is a high total for January,” Andy Challenger said in a release accompanying his firm’s report.
We didn’t even experience a January this bad during the pandemic.
Large companies are ruthlessly swinging the axe, and white collar workers are being hit particularly hard.
And the fact that new applications for unemployment benefits are rising seems to confirm that the employment market is rapidly moving in the wrong direction…
Applications for jobless aid for the week ending Jan. 31 rose by 22,000 to 231,000 from the previous week, the Labor Department reported Thursday. That’s significantly more than the 211,000 new applications that analysts surveyed by the data firm FactSet had forecast.
Applications for unemployment benefits are seen as representative of U.S. layoffs and are close to a real-time indicator of the health of the job market.
Those that have been laid off are discovering that it is not easy to find a new job in this very harsh environment.
According to ABC News, the number of available job openings has dropped to the lowest level in over five years…
U.S. job openings fell to the lowest level in more than five years, another sign that the American labor market remains sluggish.
The Labor Department reported Tuesday that vacancies fell to 6.5 million in December — from 6.9 million in November and the fewest since September 2020.
That sounds like a lot of job openings, but one recent study found that about a third of all job postings aren’t actually real.
And most of the jobs that are actually available aren’t good paying jobs.
These days, employers can be flooded with thousands of resumes for a single good paying job.
AI has been replacing white collar workers on a massive scale and that isn’t going to change any time soon.
Could it be possible that many of us will soon end up working for AI?
The machines aren’t just coming for your jobs. Now, they want your bodies as well.
That’s at least the hope of Alexander Liteplo, a software engineer and founder of RentAHuman.ai, a platform for AI agents to “search, book, and pay humans for physical-world tasks.”
When Liteplo launched RentAHuman on Monday, he boasted that he already had over 130 people listed on the platform, including an OnlyFans model and the CEO of an AI startup, a claim which couldn’t be verified. Two days later, the site boasted over 73,000 rentable meatwads, though only 83 profiles were visible to us on its “browse humans” tab, Liteplo included.
Pizza Hut will close about 250 locations in the U.S. through June as its parent company, Yum! Brands, moves to shut underperforming stores and reassess the brand’s long-term strategy, executives said.
Yum! Brands Chief Financial Officer Ranjith Roy said during an earnings call that the closures will primarily target weaker-performing Pizza Hut restaurants as part of a broader effort to modernize the chain.
The closures are tied to the company’s “Hut Forward” initiative aimed at refreshing Pizza Hut’s marketing, updating its restaurant model and improving franchise performance. Yum! said it is also reviewing broader strategic options for Pizza Hut, signaling the changes could be part of a deeper reset for the brand.
My parents would often take me to Pizza Hut when I was a kid, and I really enjoyed their pizza in those days.
So this is very sad news for me.
Of course it isn’t just the real economy that is crashing.
Digital assets, including bitcoin, have fallen deeper into the red as investors re-assess the practical utility of a token that has been championed not only as a hedge against inflation and macroeconomic uncertainties but also as an alternative to fiat currencies and traditional safe-havens such as gold.
That hasn’t panned out lately, since bitcoin peaked just north of $126,000 in early October.
On Thursday, bitcoin was last down to $67,675, its lowest since since November 2024. The cryptocurrency broke below $70,000 earlier in the session Thursday and then the selling increased. The cryptocurrency is down 20% this week alone.
The world’s most famous cryptocurrency has tumbled 44% from its October peak, falling below $70,000 Thursday for the first time in 15 months.
That decline is actually not unusual at all. Crypto is notoriously volatile, and it’s gone through numerous crashes that are bigger than this one.
What’s strange is this: Bitcoin’s four-month slump has come at a time when, in theory, it had everything going for it.
As I write this article, the price of Bitcoin is sitting at $65,187.99.
Once it falls to $63,000 that will represent a 50 percent decline from last October.
Other major cryptocurrencies have experienced even larger crashes.
Needless to say, a lot of investors that got into cryptocurrencies recently are being wiped out.
We are also seeing turmoil in the stock market, bond prices are going nuts, and prices for precious metals have been flying all over the place.
In so many ways, what we are witnessing reminds me so much of the Great Recession.
The CFO of General Motors appears to be quite pessimistic as well, because he is saying that a major economic downturn is inevitably coming…
General Motors Co. is strategizing for an inevitable economic downturn by paring down dealer inventory and maintaining a cash safety net, Chief Financial Officer Paul Jacobson said Wednesday.
Jacobson’s comments to a panel of auto insiders at the Chicago Federal Reserve Bank’s Detroit branch provide insight into industry leaders’ expectations for the broader economy, as well as reassurance that the Detroit company is taking steps to remain resilient in tougher times.
With the announcement that he is withdrawing from the Minnesota governor’s race, Tim Walz is on the hunt for a new career. Fortunately, The Babylon Bee has come up with the following list of jobs he’d be absolutely fabulous for:
Learing Center Director: These have flourished into multi-billion-dollar businesses under his watch.
Chief counselor at the “Pray Away The Straight” camp: What a perfect fit.
One of those wacky inflatable tube men at a car dealership: He’s already doing the motions. Might as well get paid.
Supervisor of the tampon dispenser at a men’s correctional facility: He’s the world’s foremost expert on stocking feminine products in masculine spaces.
Head coach for the Minnesota Vikings: Run that pick-six, Timmy.
Member of the Village People: He would reportedly prefer to be the one who wears leather chaps.
Perverted uncle impersonator: It’s a niche market, but who could be better?
President of Somalia: A natural transition.
Ol’ Tim is certain to land on his feet somewhere. What other jobs would be perfect for him? Post your suggestions in the comments.
Not Satire: Central Banks Ditch Dollars for Gold: Historic Shift Signals Trouble for the U.S. Dollar!
In a landmark development first seen in nearly 30 years, global central banks now hold more gold than U.S. Treasuries in their reserves — a milestone crossed in 2025 amid surging precious metal prices that hit new all-time highs in late 2025.
This shift reflects growing concerns over the U.S. dollar’s dominance. Key drivers include:
· Tightening gold supply from massive institutional purchases, which remove physical metal from the market for years.
· Rising risks in dollar-based assets, such as sanctions, asset freezes, and geopolitical tensions that could make Treasuries less reliable.
· Soaring U.S. national debt, reaching $38 trillion in 2025, raising doubts about long-term fiscal stability.
· Expanding industrial demand for metals like silver in tech, EVs, solar, and AI industries.
Several nations, including China and India, have continued to expand their gold reserves as part of broader diversification efforts, viewing gold as a neutral, permission-free store of value. The article argues this trend — backed by record central bank buying — signals a broader move away from dollars, potentially driving prices higher.
Against this backdrop, Preserve Gold offers a free 2026 Precious Metals Guide, designed to help individuals better understand how physical gold and silver may play a role in diversified financial planning, and even includes potential cashback offers up to $15,000. The message is clear: Institutions are acting now — everyday Americans should consider following suit to hedge against dollar risks.
Here are our 100% accurate predictions of events that will transpire in 2026.
It’s a bloodbath out there right now. On Monday alone, crypto investors lost about $200,000,000,000 in just 24 hours. Overall, crypto investors have lost about $800,000,000,000 over the last month. In this article, I want to try to explain why this is happening and what is coming next. You see, the truth is that the era of easy money is ending. For a long time, investors could borrow yen at ultra-low interest rates and use that money to purchase cryptocurrency and make amazing returns. But now Japanese bond yields are going nuts and all variations of the “yen carry trade” are starting to unwind…
For years, a lucrative trade for global investors has been to borrow yen to buy high-yielding assets like US stocks, or in this case, cryptocurrencies. Interest rates in Japan had been low or at zero, making borrowing yen relatively cheap and creating a sweet opportunity for traders. It’s known as the “yen carry trade.”
However, the Bank of Japan has signaled it could raise interest rates, in part to address stubborn inflation, continuing a recent shift away from years of ultra-low rates. Yields on benchmark Japanese bonds just hit their highest level since 2008, signaling expectations for higher rates. As rates in Japan rise, it can boost the value of the yen. That makes borrowing yen less affordable, eating into the profitability of the carry trade.
That could pressure traders to sell their bitcoin and stocks now to repay their loans and prevent the risk of further losses. In addition to a sell-off, it could lead to less cash flowing into crypto and stocks.
On Sunday night, Japanese bond yields spiked again, and this caused another round of panic for crypto investors.
And we all saw what happened once the selling started.
For years, crypto investors laughed at the rest of us as they enjoyed the ride up as the bubble inflated.
But now the bubble is bursting, and the ride down is going to be far more messy that the ride up due to the extreme leverage in the cryptocurrency market…
Ben Emons, founder and CIO of Fedwatch Advisors, said that people remain “nervous” following the recent bitcoin sell-off, adding that Monday’s reversal has broadly been attributed to a $400 million exchange liquidation.
Speaking with CNBC’s “Squawk Box Europe” on Monday, he highlighted the sizable leverage across bitcoin exchanges, which is up to 200x in some instances. With an estimated $787 billion outstanding leverage in perpetual crypto futures, against some $135 billion outstanding in ETFs, “you can do the math,” Emons said.
“There is still a lot of leverage in bitcoin out there. We can expect to some more of these liquidations if bitcoin prices don’t get off the lows from here,” he added.
As long as crypto prices just kept going up, everything was going to be fine.
But now that crypto prices are going down, we are seeing wave after wave of forced liquidations.
Yet another wave of forced liquidations is what pushed crypto prices down so rapidly on Monday.
The biggest corporate holder of bitcoin has announced a U.S. dollar dividend reserve of more than $1 billion, days after its top executive laid out what might force the company to sell some of its $56 billion in bitcoin holdings.
Strategy, formerly known as MicroStrategy, announced Monday that it will establish a $1.44 billion reserve “to support the payment of dividends on its preferred stock and interest on its outstanding indebtedness.” The reserve was funded by sales of its Class A common stock, and Strategy plans to keep sufficient reserves to fund its dividends for at least 12 months.
What we are witnessing is not just a temporary correction.
JAPAN JUST KILLED THE GLOBAL MONEY PRINTER AND NOBODY NOTICED
The most dangerous number in finance right now is 1.71%.
That’s Japan’s 10-year bond yield. Highest since 2008. Here’s why your retirement just got obliterated:
For 30 years, Japan printed infinity money at 0% rates and exported it worldwide. $3.4 trillion flowed into US Treasuries, European debt, emerging markets. This invisible bid kept YOUR mortgage cheap, YOUR stocks inflated, YOUR government solvent.
November 10th, 2025: The bid disappeared.
Japan’s yield hit 1.71%. They’re pumping $110 billion stimulus into their economy while debt sits at 263% of GDP. The math just became impossible. At 1.7% rates, Japan pays $27 billion MORE in interest. Every. Single. Year.
Here’s the extinction event nobody sees coming:
Japanese pension funds are pulling $1.1 trillion OUT of US Treasuries right now because keeping money in America LOSES them money after hedging costs. The largest foreign buyer of American debt is becoming a seller.
When Japan stops buying, interest rates don’t stay flat. They explode. US 10-year yields will jump 40 basis points minimum from flow dynamics alone. Your 7% mortgage becomes 8%. Corporate debt refinancing costs spike 60%. Zombie companies holding $3 trillion in junk bonds start defaulting in waves.
The yen carry trade just reversed. $1.2 trillion in borrowed yen funding crypto, stocks, emerging markets must unwind. Every hedge fund, every momentum trade, every leveraged bet built on free Japanese money is getting margin called simultaneously.
This breaks in three places:
Stock valuations were built for 2% bond yields forever. At 3.5% yields, the S&P 500 fair value drops 35%. Emerging market currencies collapse without Japanese capital inflows. Europe’s debt crisis returns because Italy and Spain lose their silent buyer.
December 18th the Bank of Japan meets. 50% chance they hike again. If they do, sell everything not nailed down.
Your 401k doesn’t price this in yet. The Fed can’t stop this. No central bank can.
The world’s biggest piggy bank just cracked open and the money is flowing backwards.
Position accordingly or get destroyed.
When he originally posted that, the yield on 10 year Japanese bonds was 1.71 percent.
Now it has risen to 1.85 percent, which is the highest level since 2008…
Japan just sent a shock through global markets.
The country’s 10-year government bond yield jumped to 1.85%, its highest level since 2008, marking a major break from the ultra-low rate environment Japan has lived in for decades. The move is already being called one of the most important signals for global liquidity heading into 2026.
To say that we are potentially facing a major liquidity crisis would be a massive understatement.
For the moment, it is crypto prices that are plunging, but lots of yen was borrowed to buy stocks too.
So let’s keep a very close eye on U.S. stock prices in the days ahead.
The ride up was a lot of fun for crypto investors, but now many of them are getting wiped out by the ride down. For a long time, people were using borrowed money to make absolutely enormous returns in the cryptocurrency market. Unfortunately, that bubble is bursting and an epic cryptocurrency crash is now upon us. The price of Bitcoin has fallen to the lowest level that we have seen in more than six months, and other major cryptocurrencies are getting slammed even harder. In many cases we are seeing forced liquidations take place, and it certainly wouldn’t take much for this panic to bleed over into the stock market. There have already been plenty of signs that the AI bubble is beginning to burst, and once investors start rushing for the exits it could easily turn into a stampede.
The amount of money that crypto investors have already lost is staggering.
On October 6th, Bitcoin had a market cap of 2.48 trillion dollars.
As I write this article, it has a market cap of 1.72 trillion dollars.
That is a loss of more than 750 billion dollars in less than two months.
Let that sink in for a moment.
Those that got in at the top of the market are getting absolutely crushed.
On August 22nd, Ethereum had a market cap of 583.2 billion dollars.
Today, it has a market cap of 341.6 billion dollars.
That is a loss of more than 241 billion dollars in less than three months.
On July 21st, XRP had a market cap of 201.4 billion dollars.
Today, it has a market cap of 120.1 billion dollars.
That is a loss of more than 81 billion dollars.
On September 18th, Solana had a market cap of 134.4 billion dollars.
Today, it has a market cap of 73.6 billion dollars.
That is a loss of more than 60 billion dollars.
This last example is my favorite.
On January 17th, Dogecoin had a market cap of 61.4 billion dollars.
Today, it has a market cap of just 22.5 billion dollars.
That is a loss of more than 38 billion dollars.
In other words, Dogecoin has lost nearly two thirds of its value since January 17th.
If you invested in Dogecoin, I hope that you got out in time.
When you total all five of the examples that I have shared above, the collective losses come to well over a trillion dollars.
There are more than 17,000 other cryptocurrencies that are being actively traded, and most of them have been getting monkey-hammered in recent months as well.
Speculative bubbles can be fun, and if you time things just right you can make a lot of money.
But if your timing stinks, you can end up being the one holding the bag when the wheel stops spinning.
In the days ahead, a lot more bubbles are going to burst because the real economy is steadily deteriorating.
Earlier today, CNBC posted an article that declared that we are in “a structural goods recession”, and anyone that looks at the numbers objectively cannot deny this…
For the first time in 2025, rates for van, flatbed, and refrigerated loads in October were all lower on both a month-over-month and year-over-year basis, according to the DAT Truckload Volume Index.
“Freight volumes in the third quarter and October reflect what we’re seeing in the broader goods economy, with shippers drawing on inventory built up earlier in the year to reduce their exposure to tariffs and weak consumer demand,” said Ken Adamo, DAT chief of Analytics. “As a result, the traditional peak holiday shipping season looks virtually non-existent this year,” Adamo said.
Van truckloads were down 3% compared to September, and 11% year over year. Refrigerated truckloads were down 2% month over month, and 7% year over year. Flatbed truckloads were down 4% month over month and 3% year over year. The reduced level of dry van and temp-controlled loads that are moving now through the supply chain are goods moving from distribution centers to retailers. The causes of the trade decline range from weakness in housing and manufacturing to energy costs, and shippers pulling forward imports earlier in the year and building inventories to reduce tariff impacts.
Meanwhile, the number of corporate bankruptcies just continues to soar.
According to Zero Hedge, through the month of October the number of corporate bankruptcies in the U.S. had already nearly reached the grand total for the entire year of 2024…
First came the spectacular implosions of subprime auto lender Tricolor and auto-parts supplier First Brands. Then came the regional-bank fiasco, prompting JPMorgan CEO Jamie Dimon to warn that more late-cycle accidents may be ahead. Add in signs that lower-income consumers are tapped out, frothy valuations across the AI equity sphere, and even Bitcoin sliding below $100,000, and it’s no surprise that many are beginning to wonder whether mounting financial stress signals the early stages of a broader downturn.
Another flashing red warning sign is new data from S&P Global this past week, showing that through October, 655 companies have filed for bankruptcy, nearly matching the 687 total for all of 2024.
S&P Global data showed that in October alone, there were 68 new corporate bankruptcies filings. In August, there were 76 filings, the highest monthly tally since at least 2020.
As even more large companies get into financial trouble, we will see even more mass layoffs.
Verizon CEO Dan Schulman said in a Nov. 20 letter to employees that the wireless telecom is cutting 13,000 employees, or about 13% of its workforce, as it seeks to “evolve as a company” by slashing costs and restructuring operations.
The company employed 99,600 workers at the end of 2024, according to its most recent annual report.
“Our current cost structure limits our ability to invest significantly in our customer value proposition,” prompting the need to “evolve as a company,” Schulman wrote in the letter, which was posted on Verizon’s website.
I think that Verizon is going to continue to lose market share to competitors such as T-Mobile.
It just isn’t being run very well.
You can fool people for a while, but reality will always catch up with you eventually.
We live at a time when the greatest economic and financial bubbles in our history are starting to burst.
I hope that you have positioned yourself for what is coming next, because it is certainly not going to be pleasant.
Was this just an isolated incident, or is this the beginning of the Big Crash? The carnage that we witnessed on Friday was absolutely breathtaking. The largest single day wipeout in the history of the cryptocurrency industry was accompanied by a tech bloodbath of epic proportions. Many investors that were very highly leveraged got absolutely monkey-hammered. In particular, wave after wave of forced liquidations caused a cascading cryptocurrency crash that was unlike anything that we have ever seen before. Approximately 19.2 billion dollars in leveraged positions were suddenly liquidated, and as a result the collective value of all cryptocurrencies fell by almost 800 billion dollars in just 24 hours…
The cryptocurrency market suffered a massive wipeout, erasing nearly $800 billion in value within 24 hours. Around $19.2 billion in leveraged positions were liquidated as panic spread across exchanges.
Bitcoin plunged to $110,951, marking a 16% drop, while Ethereum slipped to $3,795, down more than 12%. The total crypto market capitalization fell to $3.69 trillion, its sharpest single-day decline in months. Altcoins were hit even worse. XRP fell 25% to $2.34, and Dogecoin dropped 28% to $0.18. Solana slid to $177, Cardano fell over 25%, and BNB lost ground, trading near $1,122.
This was basically a “1929 event” for cryptocurrencies.
This is what happens when people borrow massive amounts of money and bet it on “sure things” that they think will never go down.
As Ash Crypto has aptly described, what we essentially witnessed was “a chain reaction in a highly leveraged game of musical chairs”…
We saw the biggest crash in the history of crypto with $19.2 billion liquidated and approx $800 billion in value wiped out across the board.
Altcoins were hit the hardest , with many dropping 50%or more in just hours.
Prices for some tokens, like IOTX on Binance, even briefly hit zero due to the chaos.
But what exactly started this crash?
To break it down simply, think of it like a chain reaction in a highly leveraged game of musical chairs.
When the music stops, a lot of players get forced out, making things worse for everyone.
A lot of people that believed that they were very wealthy on Thursday are now picking up the pieces.
But apparently one crypto whale had advance knowledge that the crash was coming…
A crypto whale made over $160 million in profit by shorting Bitcoin and Ethereum on Hyperliquid ahead of Trump’s 100% China tariff announcement
The trader closed all ETH short positions for $72.33 million profit and still holds $92.84 million in BTC shorts with 5.38x leverage
That is extremely suspicious.
Hopefully authorities will look into that.
Also on Friday, the largest U.S. tech companies collectively lost 770 billion dollars in market capitalization…
Shares of Amazon, Nvidia and Tesla each dropped around 5% on Friday, as tech’s megacaps lost $770 billion in market cap, following President Donald Trump’s threats for increased tariffs on Chinese goods.
With tech’s trillion-dollar companies occupying an increasingly large slice of the U.S. market, their declines sent the Nasdaq down 3.6% and the S&P 500 down 2.7%.
When you add the losses in the cryptocurrency market to the losses in the stock market, you get a grand total that greatly exceeds a trillion dollars.
Ouch.
The primary reason why the financial markets are being shaken is because there have been shocking new developments in the trade war between the United States and China…
On Thursday, China’s commerce ministry said that starting on Dec. 1 a license will be required for foreign companies to export products with more than 0.1% of rare earths from China or that are made with Chinese production technology.
That prompted President Donald Trump to announce Friday that he will impose an additional 100% tariff on China and limit U.S. exports of software. But while it seemed like the latest tit-for-tat exchange in the U.S.-China trade war, there’s much more at stake.
“We should not miss the fundamental point on rare earths: China has crafted a policy that gives it the power to forbid any country on Earth from participating in the modern economy,” Dean Ball, who served as a senior advisor in the White House Office of Science and Technology Policy earlier this year, wrote on X on Saturday.
“They can do this because they diligently built industrial capacity no one else had the fortitude to build. They were willing to tolerate costs—financial and environmental and otherwise—to do it. Now the rest of the world must do the same.”
China has a stranglehold on rare earths, producing more than 90% of the world’s processed rare earths and rare earth magnets. They are used across industries, from the tech sector to automakers and defense contractors.
While we were playing checkers, the Chinese were playing chess.
And so now we are in a world of hurt.
On Sunday, President Trump tried to reassure us that everything will be just fine.
But the Chinese are not backing down.
They are furious about the sanctions and the port fees that the U.S. is imposing, and they are warning that they are prepared to introduce even more “countermeasures”…
Donald Trump’s latest threat to impose an additional 100% tariff on Chinese goods is “a typical example of US double standards”, China’s government has said.
A commerce ministry spokesperson also said China could introduce its own unspecified “countermeasures” if the US president carries out his threat, adding it was “not afraid” of a possible trade war.
We are in far more trouble than most people realize.
This really could be the crisis that pushes the financial markets over the edge.
The stock market boom that we witnessed earlier this year was driven by AI, and the truth is that AI has now become the biggest financial bubble of all time. OpenAI is just one example of how absurd this AI bubble has become…
Fast forward, and OpenAI now has deals to build 16 gigawatts of data centers. Based on Wall Street estimates, they are likely to cost about $750 billion.
OpenAI has also committed to buying $300 billion worth of cloud computing services from Oracle over the next five years. Altogether, OpenAI is now on the hook for roughly $1 trillion of spending.
OpenAI may very well be the hottest start-up of all time—and there is a long line of investors looking to back them—but a trillion dollars is, to put it succinctly, nuts. It’s roughly 3.4% of 2024 U.S. gross domestic product and about a quarter of all nonresidential private investment.
All this from a start-up that still has large and growing losses. I’m a big believer in AI, but I still believe in math. And the numbers don’t add up.
Do you remember how bad it was when the “dotcom bubble” burst?
Well, this is going to be much, much worse.
At this stage our entire financial system is essentially a giant unsustainable Ponzi scheme, and nobody is going to be able to keep it from totally collapsing.
For many crypto investors, it is already too late to get out in time.
But most other investors still have a window of opportunity to get out before there is a mad rush for the exits, but that window of opportunity will not stay open for long.
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