In Asia, as the old Confucian wisdom goes, when neighbors stop shouting, the rice finally cooks. Along a 2,400-mile border seasoned by history and the occasional scowl, China and India appear to have learned what the Malthusian West has not: cycles matter, and permanent hysteria is bad for harmony. Celebrating India’s 77th Republic Day, ‘Xi-The Pooh’ politely praised the friendship, noting that China–India relations are vital to peace and prosperity—because, in his words, when the dragon and the elephant dance together, the village sleeps better. Even Confucius would nod balance beats ideology, and coexistence beats chaos.

https://www.indiatvnews.com/news/india/dragon-and-elephant-dance-together-china-s-xi-jinping-sends-warm-republic-day-greetings-to-india-2026-01-26-1027547

A wise kingdom does not burn its house to impress the neighbors. India is not Europe—it still believes in sovereignty, survival, and keeping the lights on, which explains why it is rising in a multipolar world. China, equally fond of ancient lessons, knows that empires don’t fall from one battle but from fighting everywhere at once—Napoleon learned that the hard way. With Taiwan, trade wars, and domestic strains already on the menu, Beijing has little appetite for turning India into another front. The result? India becomes strategically indispensable—neither anti-China nor obediently Western—while the dragon and elephant quietly agree that balance beats bravado.

In yet another bold stride toward self-inflicted austerity, the Educated Yet Idiots of Eurostan have triumphantly approved a legally binding ban on Russian gas—declaring moral victory while quietly booking higher energy bills. Brussels will phase out Russian LNG by 2026 and pipeline gas by 2027, proudly rebranding a supplier swap as “energy independence.” Never mind that Russia once covered 40% of EU gas and still supplies what ideology can’t replace—because factories don’t run on virtue signalling. Hungary and Slovakia objected, Bulgaria abstained, and Hungary plans a legal challenge, but centralized wisdom prevails when Brussels decides, national autonomy is optional, even if the price is deindustrialization.

https://www.reuters.com/business/energy/eu-countries-give-final-approval-russian-gas-ban-2026-01-26/

Europe’s problem is simple: it’s run by people who confuse ideology with economics. Energy is the cost of production, so when Brussels deliberately drives energy prices higher, it drives up the price of everything—this isn’t “Putin’s inflation,” it’s EU-made inflation. Sanctions, Net Zero dogma, killing nuclear, attacking farmers, regulating industry into extinction, and now banning the very energy inputs that built modern Europe is a masterclass in self-harm. Russian gas isn’t being banned because it makes economic sense, but because EU policy has become a theocratic regime—and heresy is no longer tolerated, even if it means marching straight into depression.

Silver just ripped 53% to record highs month to date —and somehow the usual suspects are heading for the exits. ETFs are selling, speculators are trimming longs, margins are up, and hedge funds are suddenly shy.
Yet prices keep moonwalking higher. So, who’s buying? Likely Asian retail and industrial players who don’t bother filing paperwork, with China flashing a $14/oz Shanghai premium like a neon sign saying “we’re not done.”

In short: the rally isn’t driven by Wall Street hype but by real-world scrambling for metal—which is bullish…

January isn’t even finished, yet one of The Macro Butler’s 2026 predictions has already clocked in for work.

No bragging—just numbers doing what they do. As of the January 27, 2026 close, the Dow is officially worth less than 10 ounces of gold. Paper assets, meet periodic table.

If you’re curious about the other 10 fiery forecasts for a very flammable 2026, you know where to click. 🔥📉🪙

https://themacrobutler.com/monthly-meditation/

With Washington warming up for its next shutdown circus, the U.S. Treasury sold $70bn of 5-year notes at a cheerful 3.823% yield—up from 3.747% a month ago and the highest since July. Demand was, unsurprisingly, less than enthusiastic, as the auction politely tailed the 3.820% when-issued by 0.3bp, making it seven tails in the last eight auctions.

The bid-to-cover limped in at 2.34, basically unchanged from last month’s 2.35 and just under the six-auction average—because why break the streak of mediocrity. Internals weren’t much better: Indirects improved slightly to 60.7% but still failed to impress, Directs behaved exactly as expected, and Dealers were left holding 10.8%—a bit more than last month and conveniently above average. In short, nobody panicked, nobody got excited, and the market collectively shrugged.

Overall, this was an ugly auction—but still not as ugly as what’s coming once investors finally realize that the once “risk-free” asset is neither risk-free nor particularly safe. In a world sliding into resource wars and geopolitical fragmentation, Treasuries are quietly morphing from the safest asset on the shelf into one of the riskiest things you can pretend to own.

While The Manipulator-in-Chief and his loyal echo chamber keep celebrating the “greatest economy ever,” consumer confidence just fell through the trapdoor. The Conference Board headline collapsed from 94.2 to 84.5—miles below expectations and, the weakest since 2014. Turns out, when propaganda meets grocery bills, reality wins every time.

The Expectations Index has now spent a full year below 80—the official “recession ahead” warning label—but don’t worry, everything is fine. Consumer confidence face-planted in January, with all five components declining and the index sinking to levels last seen in 2014, apparently outperforming even its COVID-era gloom. Everyone is more pessimistic—young, old, rich, poor, left, right, and especially the politically homeless Independents—though Gen Z remains cheerfully optimistic, perhaps because they haven’t opened a mortgage statement yet.

History’s longest-running case study has a simple takeaway: confidence is everything. Once people lose faith in government, the clock starts ticking. We’re already sliding into a global recessionary trend through 2028, while Europe confidently announces it no longer needs the U.S. and can apparently take another solo run at Russia—for the sixth time, because repetition builds character.

In this context, volatility is lighting up across markets. Coincidence, of course. Timing, as always, is everything.

🤵 The Macro Butler Special Service 🤵

🌐 The Fed was designed to be independent, apolitical, and scientific—so why does it keep moving markets, elections, and the US empire? 🌐

Read more here: https://themacrobutler.substack.com/p/independent-in-name-only

Listen to a summary of The Macro Butler Special Service Newsletter via podcast on Substack; YouTube; Rumble & TikTok.

https://themacrobutler.substack.com/p/independent-in-name-only-podcast

The January FOMC meeting in one pictogram.

For those who want to know more read The Macro Butler comments here: https://themacrobutler.substack.com/p/independent-in-name-only

The economy may be “booming” in Washington cocktail circles, but on Main Street the housing market has quietly changed the rules: buyers are backing away, inventory is piling up, and affordability is still missing in action—enough so that about 40,000 U.S. home deals were scrapped in December, a chunky 16.3% of contracts, the highest December flake-out rate since at least 2017.

https://www.redfin.com/news/home-purchase-cancellations-december-2025/

Excess demand and ultra-low mortgage rates fueled the housing boom until about 2023, but like all cycles, momentum faded as rates rose and affordability cracked. At the same time, pandemic-era policy and taxes pushed people and firms out of states like New York and California, a migration that has since largely settled as state-level political and economic conditions stabilized.

Even with long-term yields and mortgage rates easing—30-year mortgages now near three-year lows—they remain far above the ultra-cheap levels of the early 2020s. Monthly payments are still out of reach for many buyers, and sellers now outnumber buyers by record margins, a sharp reversal from the recent era of frenzied bidding wars and over-ask offers.

In a boom, buyers panic and overpay; in a cooling market, they do the opposite—step back when the numbers no longer add up. That’s exactly what Redfin’s cancellation data reflects: buyers walking away during inspections and contingencies as the true cost of homeownership reveals itself. This is not 2008—there’s no wave of forced defaults driven by reckless credit—but rather a pre-emptive slowdown where buyers and lenders are exercising caution before deals close. With mortgage rates above long-term norms, property taxes and insurance elevated, and wages lagging a decade-long surge in home prices, affordability has deteriorated sharply. Younger buyers are the main casualties, as “starter homes” have quietly evolved into luxury items in disguise.