The post A Real Abundance Agenda Starts by Rolling Back Patent and Copyright Monopolies appeared first on CEPR.

 

I always have fun chatting with Paulie. I always find it amusing to be on the other side of the mic.

He wanted to discuss AI and markets in light of the Citrini Research post that caused such a fuss. He always asks thoughtful questions, and it was a fascinating conversation with Paul Krugman about Artificial Intelligence, Tariffs, and all sorts of fun stuff (and I got to teach him a few AI tricks).

Paulie the K’s public persona and who he is as a person are very far apart. He is a gentle soul, and widely misunderstood.

Full transcript here

 

The post Paul Krugman in Conversation with Barry Ritholtz appeared first on The Big Picture.

Britain Reconsiders 78% North Sea Oil Tax As Investment Slows

Authored by Julianne Geiger via OilPrice.com,

The UK may be quietly inching toward an awkward admission: the windfall tax experiment on oil and gas has been a flop.

The Treasury is holding talks with North Sea oil and gas producers about potentially scrapping the Energy Profits Levy before its scheduled 2030 expiry, according to people familiar with the discussions. After multiple extensions and rate hikes, the levy has pushed the sector’s headline tax burden to 78% - a level producers argue borders on confiscatory, and a level critics argue borders on ridiculosity.

The EPL was introduced in 2022 after Russia’s invasion of Ukraine sent oil and gas prices soaring. Back then, it was framed as a temporary measure to capture extraordinary profits and ease pressure on households. But prices have since cooled, while the tax has lingered and grown.

Under current rules, the levy can end early if six-month average oil and gas prices fall below preset thresholds of $78.65 per barrel and 61 pence per therm for 2026–2027. Otherwise, it runs through March 2030.

There has been anticipated industry pushback. Offshore Energies UK has warned that the levy risks long-term damage to domestic production. Harbour Energy saw nearly all of its 2022 profits evaporate under the expanded tax regime, forcing it to cut jobs and shelve projects. BP and Shell have publicly reviewed UK investment plans. TotalEnergies trimmed spending.

Politically, it’s a minefield. Labour must juggle climate goals with energy security, jobs, and the rising pressure from Nigel Farage’s Reform UK, which has pledged to scrap the levy outright. Meanwhile, the Greens want it made permanent, and the Scottish National Party argues that it threatens tens of thousands of North Sea jobs.

Then comes the strategic backdrop. The UK’s grid operator and the state-owned system operator have both warned that shrinking domestic production could increase reliance on imports and leave the country more exposed to supply shocks.

For the UK Continental Shelf, some are left to wonder if the levy quietly accelerated decline in a basin already fighting gravity.

Tyler Durden Tue, 03/03/2026 - 03:30

Macron Throws Out French Nuclear Policy Over Russia And China Threats

President Emmanuel Macron on Monday broke several decades of French nuclear taboos, promising to increase the country's arsenal and positioning France for a lead role in European security.  Macron also called for the deployment of French nuclear capable aircraft to allied nations (which could potentially include Ukraine).  The new policies are some of the most significant changes in French nuclear doctrine since the end of the Cold War.

“Today, a new phase in French deterrence may therefore be taking shape. We are embarking on what I would call forward deterrence,” the French president said. That means increasingly including European countries in France's deterrent - starting with participation in nuclear drills. 

“It will ultimately provide for the circumstantial deployments of elements of our strategic air forces to allied countries," Macron added, referring to the squadrons of nuclear-capable Rafale fighter jets.

Macron cites threats from Russian and China as reasons for the decision. His announcement comes only a week after Russian Intelligence claimed they had uncovered a British and French plot to provide Ukraine with relevant European components and equipment that would then be misrepresented to the world as proof of a domestically developed nuclear program. This also allegedly included a plan to give Ukraine at least one actual warhead and/or materials for a dirty bomb.

It may be that there was some truth to this report and now France is simply abandoning clandestine strategies and implementing nuclear plans out in the open.  The Kremlin has warned that any presence of nuclear weapons in Ukraine would result in a direct military response to European suppliers.  They say this could include a nuclear response.

French political analysts note that Macron and his leftist political compatriots may be attempting to lock France into military action before the next presidential elections in 2027, so that new leadership will be unable to reverse course.  In other words, conservatives in France are gaining significant ground due to mass immigration issues and the leftist establishment is hoping to embed military forces in Ukraine before they lose power in government.  

Macron argued to qualify nuclear proliferation in his speech while standing at a podium in front of a nuclear submarine.  The statements came off as empty posturing, but the implications are still broad.

"Whoever wants to be free must be feared. Whoever wants to be feared must be strong...To be free, we have to be feared."

France is, of course, not free.  The government has arrested and jailed numerous citizens in the past few years over online posts that violate the country's leftist "hate speech" laws.  This mostly involves punishing people for speaking out against mass immigration.  This is why Macron's strategy to bolster French military strength is unlikely to gain popular traction - Most young French people have no interest in dying for a government that wants to replace them with third world migrants.

Critics of the NATO handling of Ukraine have predicted that Europe has no intention of pursuing peace with Russia. Rather, they believe that European elites are seeking to trigger a wider war with Russia and drag the US into the middle of it.  The Trump Administration has been reticent rattle sabers over Ukraine and its peace proposals have been consistently thwarted by European leaders. 

Russian forces in the region continue to gain ground and Ukrainian troop strength is dwindling.  It would appear that the Europeans have decided to escalate rather than accept any agreement that would result in ceding territory to Vladimir Putin.    

Tyler Durden Tue, 03/03/2026 - 02:45

Trump Says He's 'Disappointed' by Starmer For Blocking Use Of Diego Garcia For Iran Strikes

Authored by Evgenia Filimianova via The Epoch Times (emphasis ours),

U.S. President Donald Trump said he was disappointed by British Prime Minister Keir Starmer’s refusal to use the joint UK–U.S. military base on Diego Garcia island to strike Iran.

A US Air Force weapons loader delivers a 2,000lbs bomb for loading into a B1 bomber at the Diego Garcia base, UK, on 22 Oct. 2001. USAF/DOD/AFP via Getty Images

In an interview with The Telegraph, published on March 2, Trump said that Starmer’s initial refusal to let Washington use the Chagos Islands base was unlike anything that had “happened between our countries before.”

Starmer confirmed late on March 1 that the UK had initially decided not to take part in U.S. strikes against Iran, but said the security situation had changed as Iranian actions began threatening British personnel and interests in the region.

“We have British jets in the air as part of coordinated defensive operations which have already successfully intercepted Iranian strikes,” Starmer said. “But the only way to stop the threat is to destroy the missiles at source – in their storage depots or the launchers which used to fire the missiles.”

Starmer said that he would now allow the United States “to use British bases for that specific and limited defensive purpose.”

Trump said it “took far too long” for Starmer to change his mind.

“It sounds like he was worried about the legality,” he said.

The base on Diego Garcia is regarded by the United States as one of its most strategically important military hubs. Located roughly 2,300 to 2,400 miles from the southern coast of Iran, it allows long-range bomber and naval operations across the Middle East, East Africa, and the Indo-Pacific.

In a Feb. 18 post on Truth Social, Trump warned that the facility could become critical if tensions with Iran escalated further. He wrote that if Tehran refused a diplomatic agreement, the United States might need to use Diego Garcia and the airfield at RAF Fairford in England to prevent a potential Iranian attack on the UK or its allies.

Diplomatic Tensions, Parliamentary Delay

Trump’s criticism also comes amid continuing debate over the UK’s decision to transfer sovereignty of the Chagos Islands, a British overseas territory, to Mauritius.

Under the terms of the agreement, signed in October 2025, the British–U.S. naval and bomber base on Diego Garcia would remain under UK control for at least 99 years, ensuring continued access for U.S. forces.

The UK government has said the agreement was necessary to safeguard the long-term operation of the base, following a series of international court rulings that weakened the UK’s legal position.

An image released by the U.S. Navy shows an aerial view of Diego Garcia. U.S. Navy via AP

According to Starmer’s remarks in January, the issue of the Chagos deal had been raised repeatedly with the White House, and he maintained that the Trump administration had already reviewed and supported the agreement at an agency level.

Trump has criticized the UK’s decision to cede sovereignty of the Chagos Islands to Mauritius, calling it an “act of total weakness” in January.

“All of a sudden [Mauritius] was claiming ownership. He [Starmer] should have fought it out and owned it or make him take it, if you want to know the truth. But no, we were very disappointed in Keir,” Trump told The Telegraph, describing the Chagos deal as a “very woke thing.”

Last week, UK officials confirmed that Downing Street was pausing to discuss the matter with the United States before bringing the bill to ratify the Chagos deal back to Parliament.

“We are sometimes going to disagree with our friends and allies in public, but we will seek to resolve those issues in private,” British Foreign Office minister Hamish Falconer told lawmakers on Feb. 25.

Referring to the UK’s decision to pause the process, Trump said it “is useful,” adding that “it took far too much time.”

“It would have been much better on the legal front if he just kept the ownership of the land and not given it to people that weren’t the rightful owners,” Trump said.

Security Risks

Roughly 300,000 Britons are believed to be in countries targeted by Iran, with 102,000 registered with the Foreign Office for alerts as officials weigh all options, including a potential mass evacuation.

Trump suggested Starmer should have always approved American use of the base, because Iran was responsible for killing “a lot of people from your country”.

“[There are] people without arms and legs and faces that have been blown up. Iran is 95 per cent of those. Those horrible events were caused by Iran,” Trump said.

Starmer said in his March 1 statement that Iran is “striking British interests” and “putting British people at huge risk.”

“Our partners in the Gulf have asked us to do more to defend them, and it is my duty to protect British lives,” he added.

Hours after his statement, a Shahed-type unmanned aerial vehicle crashed into the UK’s Royal Air Force base at Akrotiri in Cyprus. The drone struck military facilities at the base at 12:03 a.m., causing minor damage but no casualties, Cypriot President Nikos Christodoulides said in a post on X.

A dog sits at the main gate of the UK's RAF Akrotiri air base after it was hit by a drone strike near Limassol, Cyprus, on March 2, 2026. Petros Karadjias/AP

In an emailed statement to The Epoch Times on March 2, a spokesperson for the UK’s Ministry of Defence said that it regularly reviews the security of its overseas bases, including the Sovereign Base Areas in Cyprus.

The ministry also said additional capabilities had recently been deployed to the island as part of efforts to maintain regional security and stability in the Middle East.

Those capabilities are focused on defensive operations and include radar systems, counter-drone technology, F-35 fighter jets and ground-based air defence systems designed to detect and defeat airborne threats.

PA Media contributed to this report. 

Tyler Durden Tue, 03/03/2026 - 02:00

Telegram Has Reportedly Become A Pressing National Security Threat For Russia

Authored by Andrew Korybko via substack,

Authorities in Russia believe that Ukraine has quick access to Russian servicemen’s messages and exploits this for military purposes, which wouldn’t be possible without some degree of complicity on Telegram’s part, thus impugning its founder’s character after he denied working with foreign spooks.

The FSB claimed to have “reliable information that the Ukrainian armed forces and intelligence agencies are able to quickly obtain information posted on the Telegram messenger and use it for military purposes.” This coincides with the government allegedly throttling Telegram on the grounds that it’s not in compliance with local laws, which preceded reports that it’ll be banned on 1 April. The authorities denied that they have nay such plan but there’s no doubt that Telegram is now controversial in Russia.

Speculation about Ukraine’s access to the messages sent by Russian servicemen on that platform, which the FSB also touched upon in their two-sentence press release, is credible in light of founder Pavel Durov’s brief detention by the French authorities in 2024. Although he vehemently denied that he cut a deal with them for granting their authorities access to certain users’ messages and has since accused them of askingz him to ban conservative Romanian accounts, he might be lying and it could all be an act.

After all, criticizing the French authorities in the aftermath of his scandalous detainment could be meant to convince observers that he didn’t cut a deal with them even though he might have, or he could at least have been coerced by the American ones to that end or even voluntarily decided to help the Ukrainian ones. In any case, however it ended up happening, the FSB arguably does indeed believe that Ukraine has access to Russian servicemen’s messages and uses them for military purposes.

It would therefore be best for them to speedily replace Telegram with Russia’s Max messenger app instead, which was developed for strengthening Russia’s “digital sovereignty”. That concept refers to the trend of countries asserting their sovereignty in this sphere through regulations like banning certain sites like Russia banned Facebook, Twitter/X, and others for non-compliance with local legislation and creating their own alternatives that can’t be exploited by their adversaries. It’s a sensible policy in today’s world.

In fact, so sensible is it that some cynics speculate that the pressure that Telegram has recently come under in Russia is part of the state’s campaign to get citizens to use Max, but that still doesn’t discredit the FSB’s claim about Ukraine having quick access to Russian servicemen’s messages. Telegram is used by many of them to communicate with each other as well as by many Russian businesses to engage with their clients. It’s also a useful channel for sharing facts about Russian policy with the rest of the world.

Even in the scenario of Russia banning Telegram, it could still be used with a VPN just like Facebook, Twitter/X, and other banned sites are, which the FSB obviously knows and thus challenges the cynical speculation that it might be lying about the app as part of a ploy to get Russians to use Max instead. Accordingly, their claim about it being compromised by Ukraine is credible, and this in turn impugns Durov’s character since it wouldn’t be possible without some degree of complicity on his part.

Whatever Telegram’s fate in Russia may be, Russia and others are correct in doubting the integrity of that app and all foreign ones in general since there are credible reasons to believe that they’re exploited by adversarial intelligence agencies for hostile purposes. The solution is therefore creating national alternatives and getting citizens to use them instead for strengthening “digital sovereignty”. Some states might struggle with this, however, so their citizens would then have to choose the “lesser (foreign) evil”.

Tyler Durden Mon, 03/02/2026 - 23:25

China Conducts Patrol In South China Sea, Accuses Philippines Of Disturbing Regional Peace

Authored by Alex Wu via The Epoch Times,

The Chinese regime’s navy conducted patrols in the South China Sea from Feb. 23 to Feb. 26, while the United States, Japan, and the Philippines were holding joint military exercises in international waters.

The Chinese regime criticized the Philippines for “disturbing peace” in the region.

Analysts told The Epoch Times that the standoff in the South China Sea does not necessarily mean that the situation will escalate soon, and the Chinese regime’s rhetoric reflects complicated political considerations.

The United States, the Philippines, and Japan this week conducted joint exercises over the Bashi Channel that separates the Philippines from Taiwan in the South China Sea, according to a statement by the Philippine military on Feb. 27. The drills were aimed at showcasing the forces’ “ability to operate seamlessly together in complex maritime environments,” the Philippine military said.

This was the first time that such joint exercises have been conducted in the Bashi Channel.

The Chinese regime reacted angrily to the joint drills. On Feb. 27, a spokesperson for the People’s Liberation Army’s (PLA) Southern Theatre Command accused the Philippines of “disrupting peace and stability by organizing joint patrols with countries outside the region.”

China conducted a “routine patrol” of the South China Sea from Feb. 23 to Feb. 26, according to the spokesperson.

While China claims sovereignty over the waters, citing the historical nine-dash demarcation line within the South China Sea, the Philippines, Brunei, Malaysia, Vietnam, and Indonesia each claim sovereignty over their exclusive economic zones in the South China Sea. Some of these zones overlap with each other, with communist China’s nine-dash line, and with Taiwan’s 11-dash demarcation.

On July 12, 2016, an international tribunal ruled that the nine-dash demarcation couldn’t be used by the regime in Beijing to make historic claims to the South China Sea, parts of which are claimed by six governments. China rejected the ruling and has continued to assert its sovereignty claims and operations in the South China Sea.

“China has taken strong measures to drive away ships or fishing boats that enter the area, especially Philippine supply ships,” Shen Ming-shih, research fellow at the Division of National Security Research at Taiwan’s Institute for National Defense and Security Research, told The Epoch Times.

“In such disputed areas, disputes should be shelved. It is because of China’s strong expulsion that the United States, Japan, and the Philippines are preparing for the worst-case scenario.”

Some of a total of 220 Chinese vessels are moored at Whitsun Reef, South China Sea on March 7, 2021. Philippine Coast Guard/National Task Force-West Philippine Sea via AP

Judging from the joint drills, it’s clear that the United States and Japan are paying particular attention to security in the South China Sea region, Shen added.

Commenting on the joint U.S.–Japan–Philippines drills conducted over the Bashi Channel, Wang Shiow-wen, an assistant researcher at the Taiwan’s Institute for National Defense and Security Research, said, “This may be to test the PLA’s reaction, to see if the PLA has already considered the Bashi Channel and the South China Sea or even the Taiwan Strait as its own.”

As to the PLA’s accusation against the Philippines, she told The Epoch Times: “Why is it that the PLA’s daily harassment of Taiwan under the pretext of ‘exercises and training’ is not considered ‘disturbing peace and stability in the region,’ but other countries’ joint exercises are considered ‘disturbing the regional peace and stability’?”

The PLA spokesperson’s avoidance of directly naming the United States and Japan in its accusation may be laying the groundwork for future joint military exercises between China and Russia, or possibly North Korea, Wang said.

Furthermore, with an April meeting scheduled between U.S. President Donald Trump and Chinese leader Xi Jinping, both sides are currently cultivating a “friendly” atmosphere, making direct criticism inappropriate, she said.

Shen has a similar assessment. “Because the Chinese Communist Party (CCP) is currently hoping to ease tensions with the United States, and relations between China and Japan have already deteriorated, in order to avoid further complications, the Southern Theater Command only dared to condemn the relatively weaker Philippines in its statement this time.”

Deterrence

As to whether both sides doing military drills and patrols in the South China Sea in the same week might escalate the tension into a conflict, Shen said that “the main policy of the United States is to strengthen the defense capabilities of various countries in the First Island Chain region in order to deter China from easily launching a conflict or war in this region.”

An MH-60S Sea Hawk helicopter, attached to Helicopter Sea Combat Squadron (HSC) 14, prepares to land on the flight deck of Nimitz-class aircraft carrier USS Abraham Lincoln (CVN 72) on Jan. 15, 2026. Mass Communication Specialist Seaman Apprentice Cesar Zavala/U.S. Navy

If war becomes unavoidable in the region, the United States should have many ways to participate. “Ultimately, war with the CCP will only be a last resort. Before that, political, economic, and cyber warfare are already underway,” he said.

Regarding the PLA spokesperson’s statement about China’s need to “safeguard China’s territorial sovereignty” and “uphold regional peace and stability,” Wang said that the Chinese regime is actually saying that as long as the United States, Japan, and the Philippines are not taking Chinese territory, the PLA won’t launch a preemptive attack.

Given the current military strength of the CCP, starting a war is not the problem, according to Wang. “The problem lies in how to sustain and end the war,” she said. “The Russia–Ukraine war has entered its fifth year, which should serve as a great warning to the CCP.”

“If the CCP leader Xi Jinping wants to escape his various domestic crises by starting a war, then it can only be said that he himself has determined the fate of the CCP regime,” she said.

A Chinese PLA Navy ship (background L) is seen while an Australian Navy destroyer (R) takes part in a maritime cooperative activity near Scarborough Shoal, on Sept. 3, 2025. Ted Aljibe/AFP via Getty Images

Shen believes that the PLA’s patrol was routine, saying, “I don’t think it’s likely to start a conflict or war right now.”

“I think maintaining internal stability, conducting the CCP’s Fifth Plenary Session effectively, and balancing the power should be the top priorities right now.”

Shen added that when the internal power struggle within the CCP deteriorates or intensifies, “if [the regime] wants to take actions to divert [the] Chinese public’s attention from the domestic to the international, it might target the relatively weaker Philippines or the South China Sea.”

Tyler Durden Mon, 03/02/2026 - 20:55

Watch: Israel Neutralizes Hezbollah Missiles With Game-Changing "Iron Beam"

Hezbollah opened a new front in the broadening U.S.-Israeli war with Iran overnight, launching a barrage of missiles and kamikaze drone swarms at an Israeli military base in northern Israel. 

Footage of one of those missile launches posted on X by the Israeli Public Broadcasting Corporation (IPBC) shows what appears to be some of those Hezbollah missiles prematurely exploding moments after launch. 

IPBC explained that the apparent misfires were due to the "Interception of the Rocket from Lebanon Carried Out Using the "Iron Beam" Laser System." 

⚡HISTORIC: For the first time ever, Israel used the Iron Beam to intercept rockets fired by Hezbollah. pic.twitter.com/DU63REU22k

— Israel War Room (@IsraelWarRoom) March 2, 2026

We reported last fall that Israel Defense Forces rolled out its new high-powered laser defense system, known as the "Iron Beam."

The laser-based air defense system was developed by Rafael and built to complement the Iron Dome missile defense shield. Instead of launching expensive interceptor missiles, it uses a high-energy laser to destroy short-range threats such as rockets, mortar rounds, and drones.

The footage likely shows the 100 kW-class Iron Beam in action, able to neutralize incoming projectiles for only a few dollars per shot, versus roughly $100,000 for a traditional interceptor rocket.

11 Patriots cost $44M.

They downed a $250K Iranian missile.

The math is brutal.

Video shows intercepts over Haifa as Israel counters more waves. pic.twitter.com/QO43UiWYu0

— Brandon Straka #WalkAway (@BrandonStraka) March 2, 2026

One of the major problems for U.S. and Israeli forces is that the cost per counter-missile and drone is extraordinarily expensive and uneconomical if the war dragged on for a prolonged period of time.

Related: 

• War Stocks Jump: These Firms Have The Most Middle East Exposure

But there is a big caveat, per the Times of Israel: "The main downside of a laser system is that it does not function well in low visibility, including heavy cloud cover or other inclement weather."

Tyler Durden Mon, 03/02/2026 - 20:30

Opposition Leader Maria Corina Machado Says She Will Return To Venezuela In Coming Weeks

Authored by Victoria Friedman via The Epoch Times (emphasis ours),

Venezuelan opposition leader and Nobel Peace Prize winner María Corina Machado said on March 1 that she will return to her country in the coming weeks.

Opposition leader María Corina Machado during an interview with AFP in Caracas, Venezuela, on July 25, 2024. Federico Parra/AFP via Getty Images

Machado, 58, did not set a date for her return, but she said in a video posted to X that one of the objectives is to prepare for “a new and resounding electoral victory.”

“I will return to Venezuela in a few weeks. I want to do so, as do hundreds and thousands of Venezuelan exiles around the world,” she said. “We will arrive to embrace one another, to work together to guarantee an orderly and sustainable transition to democracy.”

Then-Venezuelan leader Nicolás Maduro and his wife, Cilia Adela Flores de Maduro, were captured in a U.S. military operation on Jan. 3 and taken to the United States, where the pair face drug trafficking-related charges. Both have denied the charges.

Delcy Rodríguez, who has been the interim leader of Venezuela since, said that Machado, who is under investigation in her home country, should have to “answer to Venezuela” for her support of U.S. military action against Caracas.

Shortly after Maduro’s capture, U.S. Secretary of State Marco Rubio said Venezuela must go through phases of stabilization, economic recovery, and then, finally, a transition of power.

Rubio has not indicated that elections could be held in the short term.

Nobel Prize Winner

In her video, Machado praised U.S. President Donald Trump for his “vision and courage,” having “brought Nicolás Maduro before international justice—international justice that, finally, on Jan. 3, served the people and not the tyrants, serving the sovereignty expressed through the vote.”

“We want to thank the people of the United States, their government, their members of Congress, their judges, and their military men and women who risked their lives for the freedom of Venezuela and for the national security of their country and the security of all the Americas,” she said.

On Oct. 10, 2025, Machado was awarded the Nobel Peace Prize for her work fighting for democracy in Venezuela. She left Venezuela in December 2025 for Oslo, Norway, to receive the award and is currently in the United States.

She later gave her medal to Trump when she met with the U.S. president at the White House on Jan. 15.

U.S. President Donald Trump and Venezuelan opposition leader María Corina Machado in the Oval Office on Jan. 15, 2026. Daniel Torok/The White House/Reuters

Machado was an opposition presidential candidate but was disqualified from running against Maduro in the 2024 election. He was replaced by Edmundo González.

After Maduro claimed victory, protests erupted, which triggered widespread repression by the state. The opposition claimed that it had evidence that González was the rightful winner. González was deemed the victor by the United States.

Maduro and his wife are being held in U.S. custody. In their first court appearance in New York City on Jan. 5, they were charged with narco-terrorism conspiracy, cocaine importation conspiracy, possession of machine guns and destructive devices, and conspiracy to possess those items.

Maduro, 63, and Flores, 69, pleaded not guilty.

The Associated Press and Reuters contributed to this report.

Tyler Durden Mon, 03/02/2026 - 20:05

California Strikes Out: Major League Pitcher Turns Down Padres $40 Million Offer Due To State Taxes

Authored by Jonathan Turley,

This week, “there is no joy in Mudville” – the mighty Padres have struck out.

The California Padres thought that they had secured Arizona Diamondbacks pitcher Merrill Kelly with an offer of $40 million for just two years.

The Diamondbacks were offering that payout over three years, but Kelly took the Diamondbacks.

The reason?

California’s ruinous tax burden is fueling an exodus of wealthy taxpayers and businesses from the state.

It is the latest example of how Democrats have reversed the Gold Rush with a long line of U-Hauls heading to more responsible states.

Explaining his decision, the pitcher told the media that “I don’t think it’s any secret on how much money you get taken out of your pocket when you go to California.”

With the calls for billionaire taxes and attacks on the wealthy as “not paying their fair share,” Democrats and unions have doubled down on their “eat the rich” rhetoric. The problem is that wealth, like the wealthy, is mobile. Both are leaving, and the current estimate stands at a possible $2 trillion fleeing the state over the last year. California continues to lead the nation in the loss of citizens to other states.

In the meantime, Democrats are continuing their high-spending pattern under Gov. Gavin Newsom from boondoggle projects to reparations to bloated union pension agreements.

With California’s 13% tax rate on income above $1 million, players view California as illusory in terms of elite contracts. What the team giveth, the state taketh away. That does not include the higher collateral taxes and costs, including gasoline costs (which are also the highest in the nation).

It appears that the high-spending, high-taxing policies are not just benefiting red states but also their baseball teams. As a Cubs fan, I would be delighted except for the fact that Chicago and Illinois are also in the hands of Democrats pursuing the same disastrous policies.

The irony is that Texas and Florida could end up not only with more jobs but better baseball players.

Tyler Durden Mon, 03/02/2026 - 19:15

Bitcoin: Worthless Speculative Asset Or A True Monetary Alternative?

Authored by Daniel Lacalle,

The recent correction in Bitcoin has created a familiar debate. Is it a worthless speculative asset or a true monetary alternative? At $67,000, the price may be volatile, but it is hardly worthless. 

Bitcoin may be both a warning and an opportunity. It remains a strong hedge against the destruction of fiat money and financial repression for many citizens in the world, but it is also a volatile asset that can damage investors who believe its price can only rise. 

For many investors, the recent correction in bitcoin is a concern. However, this is only if we look at bitcoin in US dollars, euros or world reserve currencies.

For citizens all over the world, from Cuba to Iran, suffering the elevated inflation and currency demolition created by their governments, bitcoin is certainly a haven.

The huge growth in bitcoin’s price over the past few years shows that many investors have lost faith in fiat currencies and the solvency of states that are getting more in debt. 

Bitcoin and gold are showing that purchasing power is going down in a way that official CPI inflation measures aim to hide. Global money supply is rising faster than nominal GDP, and governments are reliant on deficits and financial repression. 

Bitcoin is a teenager that is slowly becoming a digital, decentralised, and nonforfeitable asset for many savers. It makes it harder for governments and central banks to steal wealth through inflation.

Bitcoin adoption outpaces expectations

This doesn’t mean that Bitcoin is going to take over the US dollar as a reserve currency or immediately become an alternative to fiat currencies in the world.

It can’t supply the liquidity, depth, and network effects of the main reserve currency, and it can’t totally replace fiat currency in everyday economic activities.

However, Bitcoin has become, like gold, a limit on predatory fiscal policy and a visible example of the results of monetary disorder since it is outside the control of politics and bureaucracy.

Bitcoin is more like a tech startup than a regular currency when you look at its price. However, many state currencies are more volatile than Bitcoin and have lost all their purchasing power. 

For an asset to be money, it must be a reserve of value, a generalised means of payment and a unit of measure. Dozens of state-issued currencies globally fulfil none of those criteria. Furthermore, money does not need to be issued by a state. That is simply a political construct.

Volatility is typical of what I call a teenager start-up currency. Some people can say that it has gone up a lot more than its current fundamentals or that it is still very inexpensive compared to its prospective market, depending on the assumptions they make of global adoption.

However, it is undeniable that bitcoin adoption today is much larger than what most predicted, both for transactions and as a reserve of value.

Investors need to keep in mind, though, that bitcoin is still very volatile and has significant execution risk. Understanding these challenges and how they work is essential, and the best thing to do is not to “chase the wave” but to look at it with a long-term view.

At the centre of the quest for independent money

The rise of spot Bitcoin ETFs has changed the way the market perceives Bitcoin risk by letting both institutions and individuals buy and sell it through regulated vehicles.

Inflows into ETFs have soared in the past two years, with major funds like BlackRock and Fidelity adding it into portfolios. 

In recent weeks we have seen substantial net withdrawals from many US spot Bitcoin ETFs, driven by overleveraged bets. Investors should not confuse the positive factors of an ETF with a promise of stability or guaranteed price increases.

Cleaning leveraged ETF bets is a positive in the long run but may create short-term volatility. For short-term investors, adding excessive volatility with leverage is a recipe for disaster.

A 10% drop in a day can wipe away 30% of capital, and a significant price drop added to substantial margin calls can kill a position even if the long-term trend is good.

Margin calls, forced liquidations, and automated risk systems are symptoms of an excess of leveraged bets but also an opportunity to clean up the buyer base.

If you use Bitcoin as a hedge against the destruction of money instead of a speculative asset, you would be staying away from leveraged products.

Bitcoin is not yet a total substitute for equities, productive assets, or gold within a cohesive wealth preservation plan; rather, it is a complementary asset. 

In a world where central bank balance sheets are getting bigger, government debt rises and the threat of digital currencies that may be used for monitoring and control is growing, keeping a small amount of decentralised, nonforfeitable assets makes sense, not as a fashion.

The most important thing is to think of Bitcoin as just another way to protect yourself, along with stocks in real businesses, real assets, and precious metals. 

The main recommendations for investors are to never use leverage on an asset that is so volatile, size positions based on extreme drawdowns and know that price corrections caused by ETF flows or liquidations do not change the long-term adoption pattern. 

If governments keep eroding the value of fiat money and making it harder for people to be financially independent, investors will look for ways to protect their wealth. Bitcoin may be young, but it remains at the centre of the quest for independent money, with all its risks and possibilities.

Tyler Durden Mon, 03/02/2026 - 17:40

Court Rules For WaPo Reporter In Major Win For Press In National Security Case

Authored by Jonathan Turley,

There was an important ruling last week by Magistrate Judge William B. Porter of the Eastern District of Virginia in favor of the press regarding the handling of files and materials taken in a search of the home of a Washington Post reporter.

Judge Porter ruled against the Trump Administration in what he called an “unsupervised, wholesale” search of the files of Hannah Natanson, who covers the federal government for The Post.

Instead, the court itself will conduct the review in camera.

In his opinion, Judge Porter chastized the Trump Administration for searching Natanson’s home without additional protections for the journalist’s interests in privileged sources. This has been a long-standing objection of the press to the Justice Department, which maintains that its own “filter teams” can review the files and materials relevant to their investigation and then hand them over to prosecution teams.

The Justice Department was investigating a Maryland government contractor, Aurelio Perez-Lugones, who has been indicted on charges of transmitting and retaining classified national defense information.

Judge Porter chastized the government for failing to mention a 1980 law, the Privacy Protection Act, in seeking a search warrant of Ms. Natanson’s home. The PPA mandates that a search for reporting materials “shall be unlawful” unless there is probable cause that the reporter committed certain crimes to which the materials relate. In a prior hearing, Judge Porter asked pointedly, “How could you miss it? How could you think it doesn’t apply?”

Judge Porter ruled that “[a]llowing the government’s filter team to search a reporter’s work product — most of which consists of unrelated information from confidential sources — is the equivalent of leaving the government’s fox in charge of The Washington Post’s henhouse.”

The court indicated that the search was too broad and was insufficiently protective of the journalistic interests in the case, noting that the government has a “legitimate interest in only an infinitesimal fraction of the data it has seized.”

The court said it would issue new guidelines for reviewing the material. It is a significant victory for the press.

Here is the opinion: IN THE MATTER OF THE SEARCH OF THE REAL PROPERTY AND PREMISES OF HANNAH NATANSON

Tyler Durden Mon, 03/02/2026 - 17:00

"Severely Curbed": Gold Shipments Through Dubai Stalled In Wake Of Strikes On Iran

Gold shipments through Dubai are set to stall for several days after airlines suspended flights amid U.S. and Israeli strikes on Iran and Tehran’s response, according to three industry sources and Reuters.

Because gold is typically transported by air for security and insurance reasons, the cancellations are expected to sharply limit physical flows.

Reuters writes that Dubai is a key supplier to Switzerland, Hong Kong and India. Sources said the broader impact on global supply will depend on how long the disruption lasts. They spoke on condition of anonymity.

Gold futures jumped 3% on Monday morning prior to the cash open in New York. The record high stands at $5,594.82, set on January 29.

Despite the shipping disruption, traders said major financial hubs — including China, India, New York, London and Zurich — remain operational, and market activity on Monday is expected to be driven mainly by financial flows rather than physical supply.

Elsewhere in the world of precious metals, on COMEX, gold delivery volume for February matched what was seen in December.

Despite being below the big months over the last year (Feb/Apr/Oct 2025), the delivery volume was still very strong on an overall historical basis. Inventory heading into March looked sufficient, but it'll be interesting to see how that landscape has shifted now in the wake of the new geopolitical turmoil.

Tyler Durden Mon, 03/02/2026 - 16:40

We Want One Solution, But One Solution Can't Solve Our Polycrisis

Authored by Charles Hugh Smith via Substack,

Whatever the problem, our minds seek one solution--preferably a simple one--to escape the trackless wilderness of complex, inter-connected problems. Problem-solving boils down to identifying the key problem and finding a fix that’s easy to understand and straightforward to apply.

Our minds rebel when confronted with polycrisis, a knotted mess of inter-connected problems, and so we apply solutions we already have in hand. As I explained in previous Musings, this leads us to modify our description of the problem so it aligns with the solution we already know.

This approach cannot actually solve the problem, but claiming we have a solution in hand is a highly attractive expediency for those tasked with solving problems, i.e. the leadership elites. It’s equally attractive to the rest of us, as we all want to banish uncertainty and anxiety with a quick painless fix.

Let’s start with the one solution many favor: fix the money, fix the world: if we reinstate sound money, that will fix the world. The proposed solution is easy to understand and straightforward to apply: gold (or bitcoin) is the only legal tender, so paper and digital money will be replaced by gold coins (or bitcoin equivalents).

The impetus for proposing this solution is self-evident: creating money out of thin air or by issuing credit-money that accrues interest is intrinsically self-liquidating, and so the status quo monetary system will run to failure (fiscal-financial-economic crisis) unless we change course.

I have often written that “if we don’t change the way money is created and distributed, we’ve changed nothing,“ because the current monetary system creates money at the top of the wealth-power pyramid and distributes it to the top.

The sum “trickling down” to the bottom 90% is losing purchasing power as prices rise, and so we’re seeking a monetary system that 1) reverses the “trickling” from “down” to “up” and 2) preserves the purchasing power of the bottom 90%’s labor, which is the “capital” they “own.”

The problem with the “gold is the only money” solution is it only fixes one problem: governments inflating away the value of their currency. In a corrupt society, it doesn’t eliminate corruption; it just means corruption will be transacted in gold or bitcoin.

It doesn’t reverse the “trickle” of money from its source from capital to labor/work, it favors capital enriching itself just as much as the current fiat system.

Like all such one-size-fits-all solutions, it also creates problems that are glossed over by its promoters, as everything is connected in ways that are not always visible at first blush.

Let’s break it down to its most basic dynamics.

In a “gold is the only money” economy, ten people each deposit one gold coin in a bank to earn interest on their money. The bank holds two coins in reserve to redeem depositors’ withdrawals, and loans the other eight coins to a new business seeking to expand.

Without the loan, the bank has no income to pay interest on the cash deposits. Without the loan, the enterprise doesn’t have the capital to expand. It’s win-win-win: depositors earn interest, the bank skims a profit for its owners and the enterprise now has the capital needed to expand.

So far so good, but...

Since economies expand and contract cyclically, a downturn occurs, and people spend less as a response to rising risk: revenues drop, workers are laid off and defaults / bankruptcies start rising.

Reducing-risk prudence leads four depositors to demand their coin back, and since the bank only has two coins in reserve, it calls the loan it made to the enterprise. The business has suffered in the downturn and can’t pay back the loan. The bank seizes the business and auctions its assets. Since valuations have fallen in the downturn, the assets only fetch two coins.

The bank now has four coins but the number of depositors demanding their coin back has risen to six. The bank fails, six depositors lose their money, and the enterprise is bankrupt.

This is precisely what happened in “sound money” 19th century America: hundreds of banks failed, depositors and borrowers were wiped out. The risk of panics triggering loans being called, assets being sold off at fire-sale prices, banks failing and depositors being wiped out are all intrinsic risks in this arrangement.

OK, so here’s the fix to panics: the government guarantees all depositors will get their gold coin back should a private bank fail. But the government doesn’t have enough gold to back up every deposit nationally; it too only has a reserve. Once the panic spreads nationally, the government’s reserves of gold coins are soon depleted.

This is the problem with “gold is the only money:” enterprises need capital to expand / launch, depositors seek a return on their capital, banks provide an institutional layer to manage these credit contracts.

After seeing other depositors lose their money, people no longer trust either banks or the government, and gold coins are withdrawn from circulation (stored at home) as a prudent measure. Credit--always limited to what banks had on deposit--becomes ever scarcer, crippling the real-world economy, as enterprises starved of capital have no way to expand.

OK, so here’s the fix: let’s let the government issue paper money “backed by gold.” So the Treasury issues $5,000 (the current global price of an ounce of gold) of currency for every ounce of gold it holds. But without a mechanism to keep currency and the market value of the gold aligned, then the Treasury can over time issue $50,000 of currency for each ounce held in the vault. The “backed by gold” claim is an artifice.

There’s another problem: gold, silver, oil, etc. are all commodities whose priced is “discovered” in global markets, so their value as measured in goods and services fluctuates beyond the control of any government.

As the global economy enters a boom cycle, gold rises to $10,000 an ounce, and the Treasury issues an additional $5,000 per ounce in currency. But when the boom turns to bust and the market value of gold returns to $5,000 per ounce, does the Treasury withdraw half the currency from circulation? No. The “backed by gold” currency has depreciated by half.

As I have often pointed out, “backed by gold” is illusory unless each unit of currency can be converted to gold coins on demand. Anything short of this is a duplicitous artifice.

Here’s another problem: the economy is expanding smartly, but the Treasury’s stash of gold isn’t expanding to match the increase of demand, as the government’s gold mines aren’t yielding much new gold. And since it’s costly to extract and refine the gold, the government spends most of the new gold paying to operate the mine.

The supply of gold coins is limited, and so money is scarce. People revert to barter or start using scrip or credit paper to transact business.

This is precisely what happened in the Medieval trade fairs: gold and silver were scarce, and as economic activity expanded, there weren’t enough coins to grease the expanding universe of transactions and productive enterprises.

The point here is using only precious metals as money comes with its own restrictions and risks. This is why economies augmented “sound money” in the first place. Using a commodity--which is subject to the same price discovery of supply and demand as any other commodity--is intrinsically problematic.

Basing a currency on a basket of commodities ends up facing the same problem: as the global price of the commodities fluctuates, so does the value of the currency, opening the door to distorting arbitrage and financial panics.

You see the other problem: the wealthy who have accumulated gold and silver are the lenders, and the commoners who only have their labor to sell / invest are the borrowers. There is risk on both sides of this equation, but over time those collecting interest will get richer and borrowers will be wiped out by a panic or downturn.

The wealth “trickles up,” and if the wealthy don’t lend their wealth to new enterprises, the economy stagnates. If banks don’t exist due to social trust being limited, then lending is restricted and the economy stagnates.

As a general rule, labor needs some working capital to turn work into a productive enterprise or other assets. So when entrepreneurial commoners sought to expand production in the “sound money” 1200s to 1400s, since they had little gold/silver or access to credit, they reverted to letters of credit and bills of exchange--forms of “paper money” that enabled transactions that would have otherwise never occurred.

As always, I recommend Braudel’s trilogy for those interested in gaining a more comprehensive understanding of money and the development of capitalism:

The Structures of Everyday Life: Civilization and Capitalism, 15th-18th Century Volume 1

The Wheels of Commerce: Civilization & Capitalism 15th-18th Century, Vol. 2

The Perspective of the World: Civilization & Capitalism, 15th - 18th Century Volume 3

I covered these topics in my books Money and Work Unchained and A Radically Beneficial World, in which I explain why attempting to make one form of money do all the work we need money to do is doomed by the intrinsic limits of each form of money.

Money that excels at being a “store of value” fails in an expansive capitalist economy as a “means of exchange” for all the reasons outlined above, and all the fixes to this create additional problems, as outlined above.

This is why the Chinese introduced paper money: it wasn’t to rip off commoners via inflation, it was the necessary means of greasing local commerce in an economy without credit and scarce precious-metal coinage, much of which was in the hands of the wealthy as it was an excellent “store of value.”

Every fix that’s easy to understand and straightforward to apply has similar limits that generate inherent problems which cannot be resolved with easy fixes, as those fixes generate another set of problems.

So to end corruption, we impose more laws, more oversight, and stiffer penalties. But as recent revelations have shown, changing the rules of governance, adding transparency laws and boosting penalties did not stop corruption from seeping into every nook and cranny of America’s ruling elites.

As Lao Tzu observed, “The more laws and restrictions there are, the poorer people become. The more rules and regulations, the more thieves and robbers.“ Corruption isn’t reduced by adding more laws, it’s reduced by changing the incentives and what society accepts or deems unacceptable.

Adding more laws to be skirted by elites doesn’t change anything; only the withdrawal of The Mandate of Heaven can disempower elites serving their own interests with absolute impunity.

Here are other examples of “this one solution will fix the world.”

If there’s “plenty of energy, that fixes the world.“ But if inequality has reached extremes, having lots of energy for the wealthiest few to enjoy isn’t going to solve inequality, or the social disorder it generates.

Or this solution: AI will fix the world. Since AI is owned and controlled by the ruling elites, it will do nothing but entrench the extremes of inequality that are destabilizing the social, political and economic realms.

Or this: technology will fix all our problems. Putting data centers owned by our corporate overlords into orbit fixes nothing.

The point I endeavored to make in my Revolution Trilogy--The Mythology of Progress, Ultra-Processed Life and Investing in Revolution --is that all these conventional solutions are self-serving artifice, expedient illusions that relieve our anxiety but at the cost of leaving problems unaddressed while layering on more problems.

There are no monetary or technological fixes to moral decay and the corruption of ruling elites. Stable social orders--from tribes to empires--are successful because their ruling elites have a reciprocal relationship with the commoners who sustain the entire system. Each class has its own duties and responsibilities to the other classes.

Records from the Roman Empire’s rule in Egypt show that much of the ruling elite’s time was spent responding to pleas for assistance from the subservient classes and resolving administrative / managerial issues.

When ruling elites renounce reciprocity to serve their own interests with absolute impunity, then the social order soon reaches the “let them eat brioche” phase where society fragments. If redress (i.e. rebalancing) is suppressed, then retribution comes to the fore: the Mandate of Heaven is lost and chaos ensues.

In either case, the only way to reconnect reciprocity / rebalance a fatally imbalanced system is a social revolution that is neither political or economic per se but which transforms both the political and economic realms by changing what’s acceptable and what’s no longer acceptable.

Polycrisis can’t be untangled with simple top-down, one-size-fits-all solutions or by modifying the definition of the problem so some painless fix can be touted as a solution. These illusory fixes only make the problems worse.

The more productive approach is to decentralize control and capital so more flexible, adaptive units can experiment with solutions: households, communities, cities, counties, locally based enterprises and regions.

The entire Waste Is Growth Landfill Economy mindset must be replaced with new incentives based on a new understanding that artifice is not a replacement for authenticity, and monetizing what is most valuable destroys it.

Adapt or die sounds harsh, but if real adaptation is required, then illusory fixes, self-serving elites and expedient redefinitions of the problem will only accelerate the unraveling and the reckoning.

Tyler Durden Mon, 03/02/2026 - 16:20

Hormuz Paralyzed: Another Tanker Hit, Floating Parking Lot Of Ships Swells

Update (1555ET):

The latest Automatic Identification System (AIS) vessel-tracking data, via Bloomberg, shows that tanker traffic in the Strait of Hormuz has been paralyzed, with only a few tankers still transiting the critical maritime energy chokepoint.

U.S. Central Command said in a statement on X that IRGC naval power has been severely degraded after U.S. forces and their allies eliminated eleven warships.

Two days ago, the Iranian regime had 11 ships in the Gulf of Oman, today they have ZERO. The Iranian regime has harassed and attacked international shipping in the Gulf of Oman for decades. Those days are over. Freedom of maritime navigation has underpinned American and global… pic.twitter.com/nzdkMVMqZC

— U.S. Central Command (@CENTCOM) March 2, 2026

That may explain why Brent crude futures have not been able to sustain $80 per barrel, as traders appear to assess that the IRGC's loss of warships would make any attempt to mount a blockade short-lived, especially given U.S. naval power in the region.

Late U.S. cash session, UBS analyst Jonathan Garber told clients that "Iran's Revolutionary Guards commander said the Strait of Hormuz is closed and they will set any ship on fire that tries to pass through, Reuters reports, citing Iranian media. WTI crude oil is now up more than 7% following the headlines."

BBG Headlines:

• IRGC ADVISER SAYS WON'T LET OIL LEAVE REGION: IRAN STATE TV

However, the loss of IRGC naval power should not lead investors to discount the regime's asymmetric capabilities, such as using missiles and drones to target tankers in the narrow waterway.

Two maritime sources confirm the oil tanker Athen Nova stopped in the Strait of Hormuz after being reportedly struck by two drones by the Iranian Revolutionary Guards.

— FinancialJuice (@financialjuice) March 2, 2026

That risk appeared to materialize late in the U.S. cash session, when reports emerged that two IRGC drones struck the oil tanker Athen Nova.

Rapidan Energy Group analyst Fernando Ferreira noted:

The US-Israeli offensive has shifted Tehran's calculus from deterrence to regime survival.

Iran cannot contest US control of the Gulf in a conventional fight, but it does not need to. Its strategy has always centered on denial, using drones, missiles, and mines to raise the cost of commercial transit through Hormuz.

Even if the IRGC Navy takes heavy losses, the core threat remains. Drone and missile attacks can still disrupt shipping and rattle energy markets. 

With that said, the critical maritime chokepoint responsible for 20% of global seaborne oil flows now appears likely to remain disrupted indefinitely.

*   *   * 

FGE NexantECA Chairman Emeritus Fereidun Fesharaki told Bloomberg TV on Monday morning that any attempt by the Islamic Revolutionary Guard Corps to choke off the critical Strait of Hormuz using warships, drones, and missiles would likely be short-lived, as the regime's naval capability is too weak to sustain a blockade against U.S., British, and French naval forces.

"It's just a fear factor," Fesharaki said earlier on Bloomberg TV, following his prediction one week earlier on Bloomberg TV: "I don't think the U.S. has a choice but to go to war. It is very hard for me to see a scenario in which they would simply avoid this, turn the ships around, and go home." Fesharaki has tracked the market for decades.

Fesharaki said this morning, "The Revolutionary Guard navy is a minor force compared with what the American navy, the British, and the French can bring in."

Fesharaki's comments about the duration of the war mirrored President Trump's remarks to The Daily Mail on Sunday, in which he said Operation Epic Fury would last about four weeks. He also described the IRGC as a "paper tiger."

On Sunday, Trump announced that nine Iranian naval ships had been sunk in the operation.

"I have just been informed that we have destroyed and sunk nine Iranian naval ships, some of them relatively large and important," Trump wrote in a post on X, adding that Iran's naval headquarters has been "largely destroyed" in a different attack.

"We are going after the rest — they will soon be floating at the bottom of the sea, also!" Trump wrote.

Rapidan Energy Group analyst Fernando Ferreira provided more insight on the Strait:

Iran understands that threatening traffic through Hormuz is its most credible asymmetric lever. Even limited interference can raise oil prices and impose immediate economic costs on the U.S. and its partners, increasing pressure on Washington to de-escalate.

We expect at least moderate disruptions to Gulf oil flows in the coming days, with the risk tilted toward something more severe if tensions escalate further.

As of Monday morning, Automatic Identification System (AIS) vessel-tracking data via Bloomberg shows that tanker activity in the critical maritime energy chokepoint has mostly frozen, with limited transits.

Related:

• "Expect Moderate Disruptions": Oil Tankers Avoid Strait Of Hormuz As Operation Fury Hits Iran

• Three Maritime Incidents Reported In Strait Of Hormuz Energy Chokepoint

Goldman analyst Adam Crook told clients over the weekend that any prolonged disruption of the Strait could push Brent crude prices toward $100/bbl. Currently, Brent crude futures trade around $79 as of 0900 ET.

Tyler Durden Mon, 03/02/2026 - 15:55

US Vigilant Against Possible Domestic Attacks Amid Iran War: Hegseth

Authored by Savannah Hulsey Pointer via The Epoch Times,

Secretary of War Pete Hegseth says the Trump administration is monitoring for any sleeper cell activity in the United States.

Hegseth’s March 2 comments came after questions about a possible attack on the homeland in response to the strikes on Iran.

“We’re ready for that,” the secretary told reporters at the Pentagon.

“We’ve seen these types of folks before, and the American people can rest assured that we’re vigilant.”

Hegseth was also questioned about the March 1 shooting that took place in Austin, Texas, that resulted in multiple casualties.

According to reports from Austin Police, an armed man opened fire outside a bar, killing two and wounding 14 others.

FBI official Alex Doran told reporters that the shooter’s motivation had not been established. Evidence found on the individual and in his vehicle, however, suggests a “potential nexus to terrorism,” but “it’s still too early to make a determination,” he said.

When questioned about the attack over the weekend, Hegseth said that the event “does not change [Operation Epic Fury] at all.”

The operation in Iran is not slowing down, with Pentagon officials saying that additional U.S. forces will continue to flow into the Middle East.

The strikes on Iran have been termed “major combat operations,” and Chairman of the Joint Chiefs of Staff Gen. Dan Caine says hundreds of land and sea missions have been launched in Operation Epic Fury.

Caine offered a briefing alongside Hegseth, saying the U.S. military’s mission is to “protect and defend ourselves, and together with our regional partners, prevent Iran from the ability to project power outside of its borders.”

Hegseth and Caine emphasized the preparation that went into the recent military strike, saying the operation in Iran was the result of months, even years, of planning.

However, according to the general, the mission is not yet complete.

“We expect to take additional losses, and as always, we will work to minimize U.S. losses,” Caine added.

“The effort continues to scale,” Caine said, going on to describe the equipment used and extended efforts to take out Iranian weapons systems.

“I am proud today, as I am every day, to stand as a member of America’s Joint Force. There is no mission too complex, no distance too great, and no adversary too determined for the men and women who wear our nation’s uniform.”

Tyler Durden Mon, 03/02/2026 - 15:40

NYC Pakistan-Owned Hotel Took $146M For Illegals But Owes $13M In Taxes

Authored by Luis Cornelio via HeadlineUSA,

The Pakistani government owes New York City taxpayers millions in unpaid taxes despite making nearly $150 million through the Roosevelt Hotel by housing illegal aliens. 

The Roosevelt Hotel, owned by Pakistani International Airlines, a quasi-state entity, has $13.6 million in overdue property taxes and nearly $1 million in unpaid water bills, according to the New York Post. 

The hotel became a hub for illegal aliens after then-New York City Mayor Eric Adams entered contracts allowing hundreds of thousands of illegal aliens to live on the premises. 

According to the Post, the Roosevelt Hotel processed more than 173,000 of the 232,000 illegal aliens in the city.  

Taxpayers paid a total of $146.6 million, or $202 per room each night, for roughly 2,600 illegal aliens each night from May 2023 through June 2025. 

Among those staying at the formerly luxury hotel was Jose Ibarra, a Venezuelan gang member serving a life sentence without parole for the murder of nursing student Laken Riley in Georgia. 

The unpaid property taxes stem from a payment agreement with the city’s Department of Finance in September 2023, which required the hotel to pay $573,361 on Jan. 2. But as noted by the Post, that half-a-million-dollar bill again went unpaid, as did the $3.9 million half-year installment. 

But New Yorkers expecting those bills to be paid could be out of luck. 

The hotel recently entered a deal with the federal government to redevelop the landmark property, which could allow the Pakistani government to avoid future taxes. 

According to the Post, the arrangement might trigger a federal tax exemption, as the U.S. Department of State often asks city governments to grant exemptions when foreign governments purchase U.S. properties. 

A spokesperson for the Department of Finance said the agency has not “received” such a request but warned that prior charges “must still be paid.”

Tyler Durden Mon, 03/02/2026 - 15:00

Only The 38th Largest Oil Spike Since 1990

Today’s CoTD from DB's Jim Reid shows the daily price of oil back to 1990. When he published the report, oil (+8.4%) was tracking to be the 38th biggest daily gain over this 36-year period. The graph annotates the clusters where we have seen larger moves.

So even though it’s a big move, to get into the top 20, 10 and 5 it would need to be up +9.6%, +13.6% and +13.9% respectively.

There were huge moves around the GFC and Covid-19 turmoil, whilst the Gulf War in 1990-91 also saw several double-digit gains.

Incidentally, since Jim published his chart of the day, oil has sold off more, and at last check it was up just 5.7% on the day, erasing its kneejerk spike by more than half.

Going forward, Reid says that much will depend on the Strait of Hormuz.

It seems it’s not officially closed but passage through it would be hazardous at the moment with self-imposed restrictions from virtually all that normally travel through it.

Tyler Durden Mon, 03/02/2026 - 14:20

AI 'Vibe Coding' Could Put Ethereum Roadmap Ahead Of Schedule: Vitalik Buterin

Authored by Martin Young via CoinTelegraph.com,

Ethereum co-founder Vitalik Buterin says an experiment that used artificial intelligence to prototype the blockchain’s roadmap out to 2030 in just a few weeks could have lessons for developers. 

“This is quite an impressive experiment. Vibe-coding the entire 2030 roadmap within weeks,” Buterin posted to X on Saturday after a developer made a bet with Buterin in February that one person could use AI to code a reference implementation of the blockchain’s roadmap.

Buterin added that AI is “massively accelerating coding” and that people “should be open to the possibility that the Ethereum roadmap will finish much faster than people expect, at a much higher standard of security than people expect.”

Vibe coding is where AI creates the code for an application, allowing developers to quickly create software. The practice has become more popular as AI models have improved at coding; however, some warn that AI-generated code can be insecure.

ETH2030 architecture stack. Source: YQ

Buterin says AI code would have “critical bugs”

Buterin said that there were “massive caveats” to using AI, as the speed at which the code was written means it “almost certainly has lots of critical bugs, and probably in some cases ‘stub’ versions of a thing where the AI did not even try making the full version.”

“But six months ago, even this was far outside the realm of possibility, and what matters is where the trend is going,” he added.

Buterin cautioned that, instead of focusing on speed, more emphasis should be placed on security. 

“The right way to use it is to take half the gains from AI in speed, and half the gains in security: generate more test-cases, formally verify everything, make more multi-implementations of things.”

He said that he was personally excited about the possibility that bug-free code, “long considered an idealistic delusion,” will finally become first possible and “then a basic expectation.”

Buterin has been active commenting on the recently released roadmap from the Ethereum Foundation, “Strawmap,” which outlines all upgrades planned for the next four years. 

He has previously proposed plans to make Ethereum quantum-resistant and on Sunday said that account abstraction, or smart accounts, would “happen within a year.” 

Tyler Durden Mon, 03/02/2026 - 14:00

Construction Spending On Data Centers, Factories, Powerplants, And Office Buildings: Boom, Bust, And In Between

Authored by Wolf Richter via Wolf Street,

Construction spending on data centers in 2025 exploded by 32% from the prior year, by over 100% in two years, and by 344% from 2020, to $41 billion, according to the Census Bureau on Friday. Spending on construction costs of data centers used to be buried in office construction and was minimal compared to office construction. But more recently, the Census Bureau split out data-center construction spending going back to 2014.

Construction costs of data centers are only a relatively small portion of the immense amounts spent on AI infrastructure, most of which goes into electronic and electrical equipment, from AI servers to power generation equipment. Construction spending on data centers does not include the costs of the servers and racks but does include the cooling systems in the building and other built-in electrical equipment.

It takes years from the decision to build a data center to the data center being actually operational. And the massive amounts of capital expenditures announced by AI-related Corporate America in 2025 and the plans for 2026 haven’t yet shown up in the construction costs.

The amounts of capital expenditures being thrown around for 2026 are fantastical. Five companies alone – Amazon, Alphabet, Microsoft, Meta, and Oracle – have announced plans for $700 billion in capital expenditures for 2026, largely for AI-related projects. And how will they get this cash next year?

So this construction boom is not slowing down, unless tripped up by further the shortages of all kinds, such as power from the grid, power generators when there is no grid power, electrical equipment, electricians, specialized labor, etc.

Inflation for construction costs for nonresidential buildings jumped by 1.1% in January from December, according to the Producer Price Index (PPI) for nonresidential construction, released by the Bureau of Labor Statistics on Friday (it was hot all around). Year-over-year, the nonresidential construction PPI was up by 2.8%, almost all of which occurred over the past four months.

From January 2021 through December 2022, over those two years, prices had exploded by 34%. From the beginning of 2023 to mid-2025, prices flattened out. But they’re now taking off again.

Over the years 2021-2025, the PPI for nonresidential construction rose by 41%. With spending on data center construction up by 344% over the same period, the red-hot construction spending boom is not a result of inflation – but of the AI investment mania.

Construction spending on manufacturing plants has soared coming out of the pandemic. In 2025, at $220 billion, it was up by 192% from 2020.

This $220 billion in 2025 is over five times the amount spent on data centers ($41 billion).

The production equipment in the plant, such as the industrial robots, is not part of the construction costs. And they’re much more costly than the building itself.

Though still running at a red-hot pace, construction spending on factories has backed off from the spike in 2024, possibly as construction resources have been pulled away by the boom in data center construction, and amid reports of bottlenecks, shortages of skilled labor, and ICE hauling off workers from construction sites.

After decades of globalization, there is now a widespread rethink underway about production in the US.

These factories will all be highly automated to where manual labor is only a relatively small part of the product costs. Every year, year after year, decade after decade, automation improves, and companies try to cut their labor costs by expanding automation.

Within factory construction, spending on factories for computers, electronic, and electrical equipment exploded by 1,300% since 2020, from $9 billion in 2020 to $104 billion in 2025. This includes semiconductor plants and plants that build electrical equipment for the AI infrastructure boom.

Powerplant construction is a highly regulated process in terms of permitting and approvals, and it takes years from the decision to build a power plant to having a functional power plant hooked to the grid.

In 2025, a record $158 billion was spent on building power plants, up by 34% from 2020.

Electricity prices have soared by 41% over the past five years as demand for electricity has surged, after being roughly flat for 14 years. This increase in demand was largely driven by the new data centers.

But utilities and power generators are leery of spending billions of dollars on generation and distribution capacity for data centers that might never work out after the AI investment mania fizzles, which would turn these investments into stranded assets.

This leeriness is fed by the many hedge funds with ag land that want a utility to commit billions of dollars to run a high-voltage powerline to it, and possibly build a power plant to supply it with power, so that the hedge fund can then sell the ag land at a huge profit as data-center ready to some hyperscaler. If that deal doesn’t happen, the utility ends up with an expensive stranded asset.

Office building construction has taken a massive hit after it became clear that office landlords were getting into serious trouble as demand for office space collapsed during the pandemic. Countless landlords defaulted on their office mortgages, and numerous buildings were seized by lenders and sold in foreclosure sales for cents on the dollar. The going rate for office building transactions is now at discounts of 30% to 70% from pre-pandemic prices. The delinquency rate for office CMBS spiked to record 12.3% in January. And there are efforts underway in expensive markets to convert office towers into residential towers, while smaller office buildings get torn down and replaced with housing. Office CRE has been in a depression since 2022.

In a way, it seems surprising that anyone would still spend good money on office buildings, but it’s the old office towers that are in trouble, while the latest and greatest office towers see more demand from the flight to quality that high vacancy rates made possible.

So spending on office construction (not including data centers) dropped further in 2025, to $49 billion, the lowest since 2015, and down by 32% from the peak in 2020.

Some of this spending is for buildings that were planned years ago and that are being completed now. For example, JP Morgan’s $3-billion tower at 270 Park Avenue in Manhattan was announced in 2018, was formally topped off in November 2023, and had its grand opening in October 2025.

Tyler Durden Mon, 03/02/2026 - 13:20