🇺🇸 US Bonds Lose Safe-Haven Bid

The classic rule of buying US Treasuries during war has stopped working. The US Treasury announced a tripling of long-term bond buybacks to $6 billion, and yields rose on the news.

The 10-year Treasury yield moved above 4.85% for the first time since November 2023, up 15 basis points from before the announcement. Yields are now up 100 basis points since the ongoing war with Iran began.

The 10-year yield will exceed 5% as early as next week, bringing an unpleasant surprise for US consumers, homebuyers and borrowers.

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⚡️ JUST IN: US core consumer prices rose 0.3% in August, above the 0.2% forecast.

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🇳🇬 Medicaid Fraud Funds Nigerian Palace

Nigerian chief Nathan Ogबatyue reportedly obtained over $36 million through US Medicaid fraud. He allegedly bought California property and built a palace in Abatete, Nigeria, with gold statues of himself and his wife.

His company, California Home Health Agency, received $4 million in 2022, $17 million in 2023, and $13 million in 2024. In March, Mehmet Oz said one in three US hospices was in Los Angeles, with most allegedly fictitious.

Journalist Christopher Rufo cited suspicious payments and possible fraud indicators. Ogбатюэ refused to comment, calling him a “racist.”

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Another Anthropic employee warned that AI could threaten humanity, with Evan Hubinger estimating over 10% odds of human extinction within the next ten years.

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Oil at -3% entered the historic intervention zone of Trump and IEA states.

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10-year U.S. Treasury yields are near the psychological 5% mark.

Societe Generale warns that 5.5% is the threshold at which stocks begin facing pressure.

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🇺🇸 Fed Decision Nears

Next week, the Fed's rate decision will determine whether the bullish trend continues into the midterms. The market is cooling and waiting for Wednesday.

Polymarket gives an 80% chance of a hike. Goldman Sachs shifted from a hold to a hike forecast. The hike is already almost fully priced in.

What happens to risk assets if Trump's appointee, Warsh, does not hike 1.5 months before the midterms? Next week should be interesting.

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⁉️ CIA Warnings Before 9/11

The CIA released classified briefs showing it repeatedly warned Clinton and Bush about Al-Qaeda’s plans to attack the US before 9/11.

The documents include a 1998 warning that Al-Qaeda could crash an explosives-laden plane into an American city.

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😙 JPMorgan Cuts Fund Lending

JPMorgan stopped lending to Situational Awareness after huge losses from leveraged bets on the AI sector. The fund was forced to sell most of its public-stock holdings tied to Ken Griffin’s Citadel as semiconductor and AI-infrastructure shares plunged worldwide.

In July, the sell-off triggered a margin call. The portfolio fell 67% in one month, after gaining 439% through June.

Leopold Aschenbrenner, a former OpenAI researcher who launched the fund in 2024, told investors it had come “closer to an irreversible loss of capital than is acceptable to us,” while retaining faith in the portfolio’s fundamentals. Goldman Sachs, Citigroup, Bank of America and Clear Street remain brokers.

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⁉️ AI Safety Debate Intensifies

Trump rejects calls to slow AI development.

Anthropic CEO Dario Amodei says the risks of advanced AI escaping control are real. Powerful models may bypass shutdown attempts, a behavior already observed in simulations. He favors joint oversight by several democratic countries over control by private companies or a single state.

OpenAI CEO Sam Altman confirmed the company will not hold an IPO in 2026, citing AI safety concerns. Elon Musk and Google DeepMind CEO Demis Hassabis also backed Amodei’s warning.

Amodei says self-improving models and autonomous agents are becoming more dangerous. Within six months to a year, swarms of agents could potentially launch major internet attacks causing hundreds of billions of dollars in damage. His proposed safeguards include independent audits, shared standards among democratic countries, and international limits negotiated with China and others.

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JPMorgan just published a frightening chart of global oil inventories. If the line reaches 6.8, the global economy will collapse.

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The Bank of England spent more than £85,000 on research to justify replacing historic banknote figures. Winston Churchill, Jane Austen, Joseph Turner and Alan Turing could give way to hedgehogs, foxes, puffins and dolphins.

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⛽️ LNG Shift to US

Shell says the loss of 20 million tonnes of LNG from the Middle East will be largely offset by supplies from the US.

Some argue the Hormuz blockade and other transport corridor blockades are part of Trump’s long-term strategy to aggressively expand the US share of global energy trade. Trump is offering US oil and LNG to all major buyers as a “great alternative.”

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⚡️ JUST IN: The CLARITY Act failed to secure the required 60 votes to advance.

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After returning to office, Trump made more securities trades than all Congress members combined.

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Today’s focus is the Fed’s rate decision, which will determine whether markets move higher toward the midterms (spoiler: they will).

JPMorgan says holding rates is bearish, while a 0.25% hike is bullish, somehow confusing everyone.

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Before the 2000 dot-com crash, the S&P 500 jumped 12%, returning to previous highs. Investors who bet heavily on the internet’s future were right in the long term, but lost 50% of their capital over the next two years.

Three separate 20% bear-market rallies kept bulls in the market until they went bankrupt. The bottom came in 2002, after all participants had been wiped out, and it took about 14 years to return to breakeven.

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