<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-1-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-1_2x-new.png 2x" alt="1" width="37" />Groundhog Day, Iran Edition
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Here we go again&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/DGQ7P7D50yJIYQQm3dBT0/bdc4039ffdc0b55422082ca5a558234f/FMF-Issue-050626-1.jpg" alt="Peace Deal" width="540px" />
There&rsquo;s a lot that&rsquo;s happened in the last 18 hours or so. Let&rsquo;s try to make sense of it.
Last night, Donald Trump declared a &ldquo;pause&rdquo; to a scheme announced only 48 hours earlier in which international shipping would be &ldquo;guided&rdquo; through the Strait of Hormuz &mdash; but not with U.S. Navy escorts.
Just as well. No one understood the initial announcement. &ldquo;We&rsquo;ve really no idea what all this means,&rdquo; one shipping exec told the Financial Times. &ldquo;There&rsquo;s no communications plan, no routing information has been published and there&rsquo;s no assurance ships will be supported in the event of any attack.&rdquo;
The &ldquo;pause&rdquo; announcement was good to knock down the price of U.S. oil futures decisively below $100 for the first time in a week.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Then early this morning came another &ldquo;peace is at hand&rdquo; post from one of the Trump administration&rsquo;s favorite reporters &mdash; Barak Ravid of Axios.
&ldquo;The White House believes it's getting close to an agreement with Iran on a one-page memorandum of understanding to end the war and set a framework for more detailed nuclear negotiations, according to two U.S. officials and two other sources briefed on the issue.&rdquo;
Never mind, as Cato Institute scholar Justin Logan tweets, that &ldquo;Barak Ravid has predicted seven of the last zero peace deals between the U.S. and Iran.&rdquo;
Crude plunged in a matter of moments from over $98 to under $90.
➢ And par for the course, there was what looks like blatant insider trading ahead of Ravid&rsquo;s &ldquo;scoop&rdquo; &mdash; a $920 million bet on falling oil prices that generated $125 million in profit in just 3&frac12; hours.
Meanwhile, stock futures sailed higher &mdash; as frequently happens under these circumstances.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/h7YJgow88rPX8RzyJf8VK/efd5f67e25cf4c63ab739927a306d416/FMF-Issue-050626-2.jpg" alt="TT3 Tweet" width="540px" />
A couple of hours later, Trump posted on his Truth Social site that Iran will be bombed at a &ldquo;much higher level&rdquo; if there&rsquo;s no deal.
That reversed the price action in oil &mdash; from under $90 back to $96. Still substantially lower than was the case when we were writing to you 24 hours ago. Checking our screens at midday, it&rsquo;s $95.57.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The major U.S. stock indexes leaped higher as soon as trading opened at 9:30 a.m. EDT.
And those gains are still holding &mdash; the S&amp;P 500 up over 1% in record territory at 7,340 and the Nasdaq up 1.6% in record territory at 25,728. (As usual of late, the Dow is the laggard, up 1% and still 200 points away from 50,000.) It helps that there&rsquo;s been another blowout earnings report from a chipmaker: AMD is up 16.8% after boffo numbers and strong guidance.
Bonds are rallying too, sending yields down. At last check the yield on a 10-year Treasury note is back below 4.36%. What we&rsquo;ve been noticing in this space is being picked up by others&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/7HbK9hZvs0AbMMeRYPDZid/e2d62216edc34c9b9d5463518696d7fb/FMF-Issue-050626-3.jpg" alt="Gromen Tweet" width="540px" />
Precious metals are rallying big-time &mdash; gold up 2.7% to $4,681 and silver up 5.6% to $76.80. Crypto, however, is consolidating with Bitcoin around $81,500 and Ethereum still a ways away from $2,400.
Meanwhile, all the supply-chain snarls we chronicled again <a href="https://paradigmpressroom.com/post/summer-of-shortages-050526">yesterday</a> remain with us: The big Dutch firm Philips says it&rsquo;s having trouble obtaining helium for its MRI and CT scanners.
&ldquo;Medical imaging has a huge global footprint and unfortunately indeed with the Strait of Hormuz we saw the vulnerability of the dependency of such a finite material,&rdquo; CEO Roy Jakobs tells Bloomberg.
And that&rsquo;s where things stand with the war. Let&rsquo;s nervously turn our attention to other matters&hellip;
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-2-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-2_2x-new.png 2x" alt="2" width="37" />Gold: What&rsquo;s Next?
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;Central banks picked up their gold buying in the first quarter of 2026,&rdquo; says Paradigm macroeconomics maven Jim Rickards.
&ldquo;Elevated central bank buying ramped up in early 2022, after Russia invaded Ukraine. Biden and his EU cronies foolishly confiscated $300 billion worth of U.S. Treasuries owned by Russia's central bank.
&ldquo;This instantly caused central bankers around the world to buy gold, and reconsider their allocation to U.S. Treasuries. It was the spark that accelerated the current bull run, and there&rsquo;s no end in sight.&rdquo;
The World Gold Council reports that the total for the first three months of 2026 is 244 metric tons, the strongest quarterly figure in more than a year.
If the Q1 pace holds for the rest of the year, 2026 will easily exceed last year&rsquo;s total.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/6Z5BIbaF0gQIDTVUhro8im/a680a13461fcedaec0e613648632fad6/5.6_5_Bullets_Chart.png" alt="Buying Accelerates" width="540px" />
Major buyers in the previous quarter included Poland, Uzbekistan and China.
Key point: China is notorious for underreporting its gold purchases. Officially its gold stash totals 2,313 metric tons. Unofficially it could be at least twice as large.
For reference the U.S. total is 8,134 metric tons &mdash; <a href="https://paradigmpressroom.com/post/the-truth-about-gold-manipulation">assuming those bars aren&rsquo;t being leased to foreigners</a>.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> But what does any of this say about gold&rsquo;s investment potential with a third of 2026 already in the rear-view?
Many market observers scratched their heads when the war began&hellip; and the gold price fell.
&ldquo;Gold is supposed to go up when the world gets messy,&rdquo; observes Money &amp; Power editor (and nationally syndicated radio host) Buck Sexton. &ldquo;And yet gold has pulled back.&rdquo;
What gives?
&ldquo;The truth is when things start to break &mdash; and make no mistake, they are &mdash; investors don&rsquo;t sit around calmly rebalancing their portfolios,&rdquo; is his answer. &ldquo;They scramble and raise cash, grabbing whatever liquidity they can get their hands on.
&ldquo;And in a world still running on the U.S. dollar, that means everyone needs dollars. Now.&rdquo;
As Mr. Sexton sees it, it&rsquo;s not a gold problem but rather a liquidity problem.
&ldquo;The war in the Middle East disrupted the global economy. Oil and natural gas don&rsquo;t move without friction anymore and countries still have to pay for that energy &mdash; no matter the price.
&ldquo;And they can&rsquo;t pay in gold. They have to pay in dollars.
&ldquo;On top of that, there&rsquo;s a slow-motion credit squeeze underway, especially in private markets. Funds that were perfectly comfortable six months ago are suddenly dealing with losses, redemptions and margin calls.
&ldquo;That&rsquo;s where gold comes in. Gold is liquid. It&rsquo;s globally recognized. It can be turned into dollars quickly. So when pressure builds, it becomes a source of cash.
&ldquo;Simple as that. When cash is king, gold gets sold.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> But don&rsquo;t lose sight of that chart above. &ldquo;Even as countries deal with short-term pressure &mdash; raising dollars, stabilizing currencies, managing crises &mdash; they&rsquo;re also thinking long term and building a buffer,&rdquo; Sexton continues.
&ldquo;They&rsquo;re dumping gold with one hand&hellip; and stockpiling it with the other.&rdquo;
Deutsche Bank forecasts $8,000 gold by 2031. &ldquo;As long as central bank demand continues and gold becomes a larger share of global reserves, we could hit that number even sooner.&rdquo;
After all, &ldquo;supply isn&rsquo;t exactly flooding the market. Mining output has been relatively flat and new discoveries are harder to come by. It&rsquo;s not easy to just flip a switch and increase production.&rdquo;
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-3-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-3_2x-new.png 2x" alt="3" width="37" />AI, the White House and Hackers
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The Trump administration is digging its fingers still deeper into the AI pie.
<a href="https://paradigmpressroom.com/post/summer-of-shortages-050526">In yesterday&rsquo;s edition</a> we told you how the administration has been rethinking its hands-off approach to AI. It seems someone or a group of someones in the White House was freaked out by Anthropic&rsquo;s new Mythos model. Anthropic says it&rsquo;s so powerful that it unearthed &ldquo;high-severity vulnerabilities&rdquo; in &ldquo;every major operating system and web browser.&rdquo; A sweeping new AI executive order might be in the works.
Now comes word that Team Trump is doubling down on a Biden-administration scheme in which major AI firms share their models with the feds before they&rsquo;re released to the public.
When launched in 2024, Anthropic and ChatGPT parent OpenAI immediately signed on. Now The Wall Street Journal reports that Google, Microsoft and Elon Musk&rsquo;s xAI have also bought into the policy.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Uncomfortable question: If the feds discover vulnerabilities that these companies managed to overlook, will they tell these companies or keep it to themselves?
In 2017, we chronicled the &ldquo;Vault 7&rdquo; revelations of WikiLeaks: The CIA discovered vulnerabilities in the hardware and software produced by American high-tech companies like Cisco.
But rather than say to those companies, &ldquo;Hey, we found this stuff &mdash; you might want to patch it,&rdquo; they said to themselves, &ldquo;Hey, what if we use this stuff to jack around with the Chinese and the Russkies and the Iranians?&rdquo;
The fact that hackers might discover the same vulnerabilities and use them to jack around with you? The CIA couldn&rsquo;t have cared less.
At the time, Reuters described how as soon as WikiLeaks published the documents, engineers at Cisco were pulled off other projects &ldquo;to analyze the means of attack, create fixes and craft a stopgap warning about a security risk affecting more than 300 different products&hellip;
&ldquo;That a major U.S. company had to rely on WikiLeaks to learn about security problems well-known to U.S. intelligence agencies underscores concerns expressed by dozens of current and former U.S. intelligence and security officials about the government's approach to cybersecurity.&rdquo;
This time, the AI giants may never find out what the feds discover until millions of their users are hacked: The 2017 document dump was WikiLeaks&rsquo; last major revelation.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-4-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-4_2x-new.png 2x" alt="4" width="37" />Comic Relief
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> A timely reminder&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/5t2kvU2a606d9qwygvxeUj/2e91506636359b0a45f5a8a9179810c4/FMF-Issue-050626-5.jpg" alt="Timely Reminder" width="540px" />[Hat tip: Ed Steer&rsquo;s Gold &amp; Silver Daily. I&rsquo;ve been a subscriber for years.]
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-5-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-5_2x-new.png 2x" alt="5" width="37" />Mailbag: Trader Challenge, ASTS
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;I entered your Top Trader challenge selecting one stock, which results in making a mockery of investing in a sense,&rdquo; a reader writes &mdash; &ldquo;a gamble on long-shot investment.
&ldquo;I'd rather see something along the lines of selecting five stocks over a fiscal quarter&hellip; an investing contest with merit. Just my humble opinion.&rdquo;
Dave responds: Thank you for the input. Maybe I didn&rsquo;t emphasize it strongly enough at the outset, but this contest had nothing to do with investing. That&rsquo;s why we called it the Top Trader challenge.
Once you&rsquo;re looking at a quarterly timeframe you&rsquo;re in the hazy dividing line between trading and investing. But we&rsquo;ll take your suggestion into consideration as we figure out how to mix it up for the next go-round.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Finally, a very short email: &ldquo;ASTS &mdash; Are you still buying?&rdquo;
To be clear, this is a free e-letter and as such we seldom tackle specific recommendations drawn from our paid publications &mdash; out of respect for the paying subscribers.
But&hellip; AST SpaceMobile is a workhorse holding in James Altucher&rsquo;s entry-level newsletter Altucher&rsquo;s Investment Network. It&rsquo;s up 345% from the initial recommendation in January 2021. This is hardly the first time we&rsquo;ve discussed it here.
Yes, the share price has taken a spill since its peak in February. But Ray Blanco &mdash; the tech and biotech specialist on James&rsquo; team &mdash; is as enthusiastic as ever.
In its quest to deliver satellite wireless service to the mobile phone you already have in your pocket, ASTS has an unbeatable advantage &mdash; access to the 700 MHz and 800 MHz portions of the wireless spectrum.
&ldquo;This is the band that actually penetrates buildings,&rdquo; says Ray &mdash; &ldquo;the signal where your phone lives.&rdquo; Aspiring competitors are stuck on higher frequencies where service will be less reliable.
Ray added to his personal position after the failed launch of an ASTS satellite last month. It was a one-off failure on the part of the rocketmaker Blue Origin. As he sees it, the fundamental story hasn&rsquo;t changed.
Indeed, shares are screaming 9.2% higher today on the news that Rakuten &mdash; the Japanese conglomerate that was an early investor in the firm &mdash; has finished its previously announced plans to sell 15 million ASTS shares. (Rakuten was deep in debt; it needed cash and it was sitting on 20X gains with ASTS.)
ASTS reports earnings next Monday. If you&rsquo;re an Altucher&rsquo;s Investment Network subscriber, watch your email (or the Paradigm mobile app) for ASTS updates as they happen.

FMF-Issue-050626-Featured

mobile masthead 5MIN

Paradigm Pressroom’s 5 Bullets is a daily e-letter covering the economy and the markets, reaching 120,000 paying subscribers of the renowned financial publishing firm Paradigm Press.

Paradigm Pressroom's 5 Bullets

Groundhog Day, Iran Edition

<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-1-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-1_2x-new.png 2x" alt="1" width="37" />Summer of Shortages
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The war drums are beating more quietly than they were 24 hours ago.
Forget the competing claims and counterclaims from Washington and Tehran about who shot at whom and when.
What matters for the moment is that as Washington sees it, Tehran has not broken the ceasefire: Everything so far is &ldquo;below the threshold of restarting major combat operations at this point,&rdquo; says Gen. Dan Caine, chair of the Joint Chiefs of Staff.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> None of which changes the fact that the Strait of Hormuz remains all but closed.
We ran down the numbers two months ago. They&rsquo;re worth revisiting today. Because it&rsquo;s not just that a quarter of the world&rsquo;s crude oil transits the strait during normal times. So does&hellip;
<ul>
<li>About 15% of the world&rsquo;s refined diesel and jet fuel (which is why airline stocks are having such a rough time)</li>
</ul>
<ul>
<li>Roughly 20% of the world&rsquo;s liquefied natural gas (very bad for Europe, whose leaders already swore off Russian gas)</li>
</ul>
<ul>
<li>About 35&ndash;40% of fertilizers (Reminder: About 70% of U.S. farmers tell the American Farm Bureau Federation say they can&rsquo;t afford all the fertilizer they&rsquo;ll need this year)</li>
</ul>
<ul>
<li>Over 40% of sulfur (used in everything from fertilizers to oil refining to mining to water treatment)</li>
</ul>
<ul>
<li>And 10% or more of aluminum and iron ore.</li>
</ul>
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;There are no easy substitutes for any of these outputs,&rdquo; says Paradigm&rsquo;s macroeconomics maven Jim Rickards.
&ldquo;The U.S. and Russia may increase their oil exports somewhat but LNG, chemicals, fertilizers, aluminum and refined oil products (gasoline, diesel, jet fuel) are not easily replaced if at all.
&ldquo;Kuwait&rsquo;s Mina Al-Ahmadi oil refinery, which processes 730,000 barrels of oil per day, has been struck by Iranian missiles extensively. Saudi Arabia&rsquo;s giant Ras Tanura refinery complex, which handles 550,000 barrels per day, has also come under attack.
&ldquo;Shortages will soon appear not only in crude oil but also in refined products. Of course, damage to oil production infrastructure elevates the price of LNG alongside the prices of crude oil and refined products.&rdquo;
Speaking of LNG, &ldquo;the damage to Qatar&rsquo;s Ras Laffan LNG export facilities from Iranian missiles and drones is so extensive that 20% of its capacity may be offline for years. Ras Laffan produces 20% of the world&rsquo;s LNG.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Who&rsquo;s feeling the impact most? Jim runs down a list for us&hellip;
<ul>
<li>In the world&rsquo;s least-developed countries, Jim says &ldquo;those most dependent on Persian Gulf nitrate exports and therefore those most likely to suffer from higher prices and supply shortages are Jordan, Pakistan, Sri Lanka, Egypt, Ethiopia and Kenya&rdquo;</li>
</ul>
<ul>
<li>Among the more prosperous developing countries, &ldquo;Brazil will be the hardest hit. Brazil relies heavily on imports of nitrogen fertilizer to support its agricultural output including coffee and soybeans&rdquo;</li>
</ul>
<ul>
<li>In the developed Asian economies, &ldquo;Japan and South Korea are almost completely dependent on Middle Eastern exports of oil and natural gas. Large sectors of their industrial capacity will begin to shut down within weeks if the energy shortages are not alleviated&rdquo;</li>
</ul>
<ul>
<li>And in Europe, the impact might be the most severe &mdash; given European leaders&rsquo; insistence on what Jim calls the &ldquo;Green New Scam&rdquo; of solar and wind. &ldquo;European natural gas reserves were only 46 billion cubic meters (bcm) in early March, down from 60 bcm in 2025 and 77 bcm in 2024. The Telegraph reports that Europe is burning through gas reserves faster than they can be replaced.&rdquo;</li>
</ul>
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> And then there&rsquo;s California, unique in the United States because of its reliance on oil imports from the Gulf region &mdash; the last of which just arrived at the Port of Long Beach after a trip that started before the war on Feb. 24.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/6p2OPzIdlXpjyc9YJH1OFa/344f832532e3947ff68e0d90a13ee62d/FMF-Issue-050526-1.png" alt="pub" width="540px" />
Paradigm&rsquo;s resident oil field geologist Byron King went in-depth on California&rsquo;s conundrum in a <a href="https://dailyreckoning.com/california-nightmare-a-looming-energy-disaster/">special guest essay</a> last week &mdash; and the arrival of this tanker, called the New Corolla, puts it all into sharp focus.
&ldquo;After she sails away, California &mdash; namely its refiners, and political powers who care about energy &amp; stuff &mdash; must figure out how to replace all that imported oil that will no longer be arriving from the Persian Gulf,&rdquo; says Byron now.
&ldquo;Alternative sources include Ecuador and Brazil, but that involves outbidding refineries pretty much everywhere else, which are also scrambling for crude oil.
&ldquo;By the end of May, people in the Golden State will look back with fond nostalgia for the &lsquo;good old days&rsquo; of $6 gasoline and $9 diesel. It's going to get bad out there, and effects will ripple across the U.S. economy like a 200-car Union Pacific freight train. Brace for impact.&rdquo;
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-2-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-2_2x-new.png 2x" alt="2" width="37" />Busting a Buffett Myth
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;While value investing is where he started, Warren Buffett is actually the greatest growth investor of all time,&rdquo; says our senior investment director Enrique Abeyta.
Enrique was in attendance last weekend at Berkshire Hathaway&rsquo;s annual meeting in Omaha, Nebraska &mdash; the first where Buffett was not presiding as CEO and his chosen successor Greg Abel was.
Still, Buffett&rsquo;s presence was felt everywhere. And many attendees still sing his praises as a value investor. A few were probably lugging around copies of The Intelligent Investor, the legendary book penned by Buffett&rsquo;s Columbia professor Benjamin Graham.
As a reminder, value investing means buying companies at less than book value &mdash; the accounting value of their assets. Alternatively, it means buying a company below the replacement value of its assets, or liquidation value.
Problem is, times have changed. Value investing&rsquo;s heyday &ldquo;was before these strategies became well known, the explosion in the asset management business and (most importantly) the internet,&rdquo; says Enrique.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Besides, value investing isn&rsquo;t where Buffett made his money. &ldquo;It was buying large companies that would then go on to grow their earnings tremendously,&rdquo; Enrique says.
Case in point &mdash; the ultimate &ldquo;Buffett stock,&rdquo; Coca-Cola. A $1.3 billion investment in 1988 has swelled to $24.5 billion today.
At the time of the purchase, KO sported a price-earnings ratio of 15.8X. Over the following three decades, the median P/E was 27X &mdash; up about 70%.
That&rsquo;s nice. But look at the earnings per share: &ldquo;It has grown 1,270% from $0.18 per share to almost $2.50 per share in 2023,&rdquo; Enrique says.
&ldquo;The valuation of KO stock was not what drove the appreciation in Buffett&rsquo;s stake&hellip; it was the growth in the earnings.&rdquo;
Oh, and don&rsquo;t forget the dividends. The dividend grew 2,200% from 8 cents per share to $1.84.
Which gets back to Enrique&rsquo;s favorite Buffett quote: &ldquo;It&rsquo;s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> As for the markets today, the major U.S. stock indexes are recovering much of yesterday&rsquo;s losses.
At last check the S&amp;P 500 is back in record territory at 7,259. Ditto the Nasdaq at 25,310. The Dow is also in the green, but still a long way from reclaiming its 50,000 levels of February.
The attempt in Washington to lower the temperature in the Persian Gulf (see above) has knocked over $4 off of U.S. oil futures &mdash; now just over $102 a barrel.
Interesting: The yield on a 10-year Treasury note has been bumping up against the 4.4% level for a few days now. Back in March, every time the 10-year approached 4.4%, Donald Trump made some sort of conciliatory statement or gesture toward Tehran so as to not further spook the bond market. Perhaps that&rsquo;s what&rsquo;s going on here as well&hellip;
Precious metals are staging a weak rebound, gold at $4,563 and silver at $73.18. Bitcoin has surpassed $81,000 for the first time in over three months and Ethereum is approaching $2,400.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-3-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-3_2x-new.png 2x" alt="3" width="37" />Trump and AI and Cyberattacks
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The Trump administration is rethinking its hands-off approach to AI.
Rewind to the days after Election Day 2024: Silicon Valley venture capitalist Marc Andreessen is interviewed by Joe Rogan. Andreessen tells of a meeting he and his partner Ben Horowitz had earlier that year with Biden administration officials.
&ldquo;They told us to not even start AI companies because there&rsquo;s no way they&rsquo;ll let them succeed,&rdquo; he said. The aim was to limit AI to &ldquo;a function of two or three large companies&rdquo; under tight government control.
Asked by Rogan &ldquo;What do you do after a meeting like that?&rdquo; Andreessen replied, &ldquo;You go endorse Donald Trump.&rdquo; Which he did.
Last summer, President Trump said of AI, &ldquo;We&rsquo;re going to make this industry absolutely the top, because right now it&rsquo;s a beautiful baby that&rsquo;s born. We have to grow that baby and let that baby thrive. We can&rsquo;t stop it. We can&rsquo;t stop it with politics. We can&rsquo;t stop it with foolish rules and even stupid rules.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Evidently that all changed last month when Anthropic took the wraps off its Mythos AI model. 
Anthropic claims Mythos is so powerful it unearthed &ldquo;high-severity vulnerabilities&rdquo; in &ldquo;every major operating system and web browser.&rdquo; Seems the Trump admin is now spooked by the prospect of a major AI-enabled cyberattack.
Thus, The New York Times cites &ldquo;U.S. officials and people briefed on the deliberations&rdquo; as saying the administration is &ldquo;considering the introduction of government oversight over new AI models.
&ldquo;The administration is discussing an executive order to create an AI working group that would bring together tech executives and government officials to examine potential oversight procedures, according to U.S. officials, who declined to be identified in order to discuss deliberations over sensitive policies. Among the potential plans is a formal government review process for new AI models.&rdquo;
Anthropic, Google and OpenAI have supposedly been clued into the process.
The Wall Street Journal has confirmed the Times&rsquo; account. The Journal previously reported that the White House objects to Anthropic&rsquo;s plans to release Mythos to another 70 or so companies beyond the 40&ndash;50 that got the initial limited release.
Exactly how all of this will shift the investing landscape for AI is way too soon to tell. But it&rsquo;s not too early to put this on our radar. To be continued&hellip;
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-4-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-4_2x-new.png 2x" alt="4" width="37" />Sign of the Times
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Presented without comment&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/11Qhx1dlcH9A5oy95rFyhs/cda1970d8d9568a6292a0383735d96f7/FMF-Issue-050526-2.png" alt="pub" width="540px" />
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-5-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-5_2x-new.png 2x" alt="5" width="37" />Mailbag: Lucky Man
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;You sure you want to congratulate the winner of your Top Trader challenge with ELP&rsquo;s &lsquo;Lucky Man&rsquo;??&rdquo; a reader writes after <a href="https://paradigmpressroom.com/post/so-you-think-you-can-trade-results">yesterday&rsquo;s edition</a>.
&ldquo;I mean, the guy dies in the song! Not very lucky.
&ldquo;Thanks for all your hard and excellent work.&rdquo;
Dave: Well yeah, he did &mdash; but lived a very full life beforehand!
By the way, we finally tracked down and notified the $50,000 winner &mdash; a gentleman from Tennessee who was literally too busy working to answer email or pick up the phone. Once he did, he was shocked: &ldquo;Last I checked the leaderboard I was in 200th place!&rdquo;
Hey, that&rsquo;s how it works when you&rsquo;ve got a hard 30-day window. Again, thanks to everyone who took part. We&rsquo;re scheming on how to do another event like this even bigger and better.

FMF-Issue-050526-Featured

Summer of Shortages

<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-1-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-1_2x-new.png 2x" alt="1" width="37" />&ldquo;So You Think You Can Trade&rdquo; (Results)
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> OK, that was fun.
The results are in from Paradigm&rsquo;s first-ever 30 Day Top Trader challenge.
In late March, thousands of readers like you took on the challenge of identifying the one stock or ETF with the biggest profit potential between April 1&ndash;30.
As we said at the outset, this was an unusual exercise: Forget about fundamentals. This wasn&rsquo;t about identifying a &ldquo;good company&rdquo; with &ldquo;steady growth.&rdquo; This was about short-term catalysts &mdash; biotechs with big news, short-squeeze candidates, leveraged ETFs with a trendy tailwind.
And the fixed start and end dates? That only amped up the element of surprise.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Sure enough, the best-performing pick among our readers during April was a biotech that lay low until nearly the end.
Curiously, however, it wasn&rsquo;t a blockbuster trial result or an FDA approval that gave a huge lift to Edesa Biotech (EDSA) &mdash; just speculative buying ahead of a presentation the CEO will make later in May at a conference in Orlando. The company is making tracks on Phase 3 trials for a treatment of acute respiratory distress syndrome &mdash; a sudden and severe inflammation of the lungs.
EDSA&rsquo;s share price went nowhere most of April. Then it suddenly took off &mdash; racing from under $7 on April 24 to over $18 on the 30th. It wasn&rsquo;t until the final day of the challenge that EDSA emerged as the best performer of April &mdash; leaping 237.8% over the 30 days.
A total of 19 readers &mdash; fewer than one-tenth of one percent of the challenge participants &mdash; chose EDSA as their top performer of the month.
This is why we had readers make a second and third choice in addition to a top pick &mdash; to serve as tiebreakers.
Having said that, we&rsquo;re still not in a position to tell you who won the grand prize of $50,000 &mdash; nor the winner of the $10,000 second prize and $5,000 third prize. The reason is simple: We&rsquo;re still trying to get in touch with them. (Really, if it were you, it would be weird if you read it here first!)
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Some more fun facts emerging from the challenge&hellip;
The second-best performer of the month was Axe Compute (AGPU) &mdash; which experienced two big leaps during the month before pulling back. Between April 1&ndash;30, it gained 219.5%.
The most popular pick, chosen by nearly 1,300 participants, was AST SpaceMobile (ASTS) &mdash; a favorite of our tech/biotech specialist Ray Blanco. As we chronicled in these pages, ASTS hit a speedbump on April 19 with its ambitions to deliver wireless service via the mobile phone you already carry in your pocket: The Blue Origin rocket carrying ASTS&rsquo;s inaugural satellite failed to deliver it to the proper orbit. It fell back toward Earth and burned up in the atmosphere.
ASTS ended the 30-day period down 12.6%. But Ray&rsquo;s conviction remains solid: The firm still plans to launch dozens of satellites this year &mdash; and it has launch contracts with firms other than Blue Origin.
<a id="2"></a>
Finally&hellip; among all the contest entries, the median return was 6.9%. Nearly two-thirds of participants &mdash; 63.6% &mdash; ended the month with their top pick in the green. And 1.2% submitted a pick that gained 100% or better.
Congratulations to the winners and thanks to everyone who took part. We&rsquo;re already thinking through how to do something like this again and make it even better. Stay tuned&hellip;
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-2-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-2_2x-new.png 2x" alt="2" width="37" />War Back On?
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The U.S.-Iran ceasefire is facing what looks like its most severe test since it came into force April 8.
The trading week started quietly enough, with Donald Trump announcing a scheme to &ldquo;guide&rdquo; shipping through the Strait of Hormuz.
The initial announcement came on social media yesterday &mdash; and gave the impression that U.S. warships might be escorting commercial vessels through the strait.
Not so, said The Wall Street Journal: &ldquo;The new mechanism is effectively a coordination cell to move traffic through the strait, involving countries, insurance companies and shipping organizations.&rdquo;
&ldquo;In other words,&rdquo; said one cynic on X, &ldquo;another Sunday market pump.&rdquo;
And it worked for a while: U.S. oil futures fell as low as $102 while stock futures were in the green.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Then everything started heating up this morning.
Iranian state media says Iranian forces fired warning shots at a couple of U.S. destroyers. Then a huge oil terminal in the United Arab Emirates came under Iranian attack. This terminal is the UAE&rsquo;s only means of bypassing the Strait of Hormuz.
CNN says Washington and Tel Aviv will return to war within 24 hours.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> With that, U.S. oil futures are back to $105.59. And while the major stock indexes opened the day flat, they&rsquo;re now decisively in the red.
The S&amp;P 500 is down a half percent from Friday&rsquo;s record close at 7,191. The Nasdaq&rsquo;s loss is about the same; the Dow is down 1%.
&ldquo;We&rsquo;re experiencing a split market right now that&rsquo;s yanking around different stocks and sectors every single day,&rdquo; writes Greg Guenthner at The Trading Desk (who won our internal version of the Top Trader challenge. No prize, just bragging rights.)
&ldquo;This back-and-forth action continues to dominate the tape. On Friday, the tech trade stole all the green while industrials, energy and consumer names slipped. On days where semiconductors are rallying, software stocks take a beating. The next day, they flip spots.
&ldquo;These moves can be frustrating, for sure. But it could all be part of a bigger consolidation looming now that the averages have fully recovered from their March lows. The market ran white-hot for an entire month so it&rsquo;s going to need to rest at some point.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> If the war is coming back into view, earnings are not retreating: Reports will continue to pour in this week although Nvidia is the only one of the &ldquo;Magnificent 7&rdquo; we&rsquo;re still waiting on &mdash; and NVDA doesn&rsquo;t report until May 20.
Of the S&amp;P 500 companies that have reported so far, FactSet tells us 84% have beaten the estimates of Wall Street analysts &mdash; better than the averages of the previous five years and ten years. And the average &ldquo;beat&rdquo; is by 20.7% &mdash; well above the recent norm.
➢ For the record: Spirit Airlines shut down over the weekend; for whatever reason the scheme the White House was hatching to use Spirit&rsquo;s jets as troop transports didn&rsquo;t pan out. As Sean Ring points out in <a href="https://rudeawakening.info/posts/the-spirit-of-capitalism">today&rsquo;s </a><a href="https://rudeawakening.info/posts/the-spirit-of-capitalism">Rude Awakening</a>, Spirit was not &ldquo;too big to fail&rdquo; &mdash; a rarity for a publicly traded company in 21st-century America.
Precious metals are losing ground &mdash; gold clinging to $4,500 and silver back under $73. On the other hand, Bitcoin is back over $80,000 and Ethereum is at $2,363.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-3-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-3_2x-new.png 2x" alt="3" width="37" />Report From Omaha
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The &ldquo;new&rdquo; Berkshire Hathaway is ready to deploy that enormous pile of cash it&rsquo;s sitting on.
Saturday was the first BRK shareholder meeting in Omaha, Nebraska where Warren Buffett did not preside as CEO. Instead it was his chosen successor Greg Abel.
Our senior investment director Enrique Abeyta was in attendance&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/6k7FmvVDG8nxRV8Sx9m8hC/f2f9e9faf03bdb02e6994876a24437a7/FMF-Issue-050426-1.png" alt="pub" width="350px" />
&hellip; and keen to hear what Abel had to say about the record $373 billion cash pile the company had accumulated by year-end 2025.
&ldquo;Many investors believe this was intentional,&rdquo; Enrique wrote his Truth &amp; Trends readers ahead of the meeting &mdash; &ldquo;that Buffett, in his final years at the helm, chose patience over action to give his successor maximum flexibility.&rdquo;
Sure enough, Abel said on Saturday that Berkshire has a shortlist of companies it wants to buy &mdash; in part or in whole.
At the right price, of course. &ldquo;There will be dislocations in markets that will allow us to act,&rdquo; he said.
Buffett jumped on such &ldquo;dislocations&rdquo; when they presented themselves over the decades.
&ldquo;During the financial crisis,&rdquo; Enrique said by way of example, &ldquo;Buffett deployed capital into companies like Goldman Sachs and Bank of America on extremely favorable terms, locking in high returns and reinforcing Berkshire&rsquo;s reputation as a lender of last resort.&rdquo;
Look for Enrique to share more reflections from Omaha later today when a new Truth &amp; Trends is published.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-4-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-4_2x-new.png 2x" alt="4" width="37" />Comic Relief
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> There are &ldquo;sin taxes&rdquo; and then there are&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/7mrAGdd0kFgVLwnbg8UR1N/d553266c00a0f99b8ce22caaf38e8246/FMF-Issue-050426-2.jpg" alt="pub" width="540px" />
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-5-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-5_2x-new.png 2x" alt="5" width="37" />Mailbag: Protests, Reading Comprehension, High-end Audio
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> On the subject of the May Day protests mentioned <a href="https://paradigmpressroom.com/post/the-day-america-shut-down">off the top Friday,</a> a reader writes&hellip;
&ldquo;Recently the socialist Minneapolis City Council approved funding to assist renters who fell behind in their rent because they couldn't leave home during the ICE episode.
&ldquo;During that time there were protests encouraging people to stay home from work, school, shopping. You can't make this up.
&ldquo;IMO, they have been turning Minneapolis into a sh***ole. Used to spend a lot of time and money there, haven't stepped foot there since George Floyd and won't in the future.&rdquo;
Dave responds: Numbers are hard to come by, but it seems the May Day protests were a bust &mdash; with considerably lower turnout than the &ldquo;No Kings&rdquo; protests that take place on weekends and draw an older crowd.
Doesn&rsquo;t bode well for the organizers if they hope to pull off a nationwide general strike on May Day in two more years. On the other hand, a lot can happen between now and then&hellip;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> I was stunned to read the reason why a reader demanded over the weekend that she be removed from the 5 Bullets email list.
The relevant passage, and the trigger for her outrage: &ldquo;If you&rsquo;re taking jabs at people who are constitutionally using their First Amendment rights &mdash; if you don&rsquo;t like it &mdash; too bad, shove it up your a**es.&rdquo;
Then followed a spirited diatribe against Donald Trump.
Too bad her outrage overwhelmed her reading comprehension: I took a minor swipe at Jimmy Kimmel <a href="https://paradigmpressroom.com/post/the-day-america-shut-down">during Friday&rsquo;s edition</a>in defense of his right to say stupid things. I was taking the president and his FCC chair to task for actions that undermine the First Amendment.
This is every bit as pathetic as conservative readers who call me a &ldquo;liberal&rdquo; when I deign to say critical things about the Iran war. Is Tucker Carlson a &ldquo;liberal&rdquo;? Ron Paul?
No, this is not a renewed plea for sympathy on the part of the many gracious readers who <a href="https://paradigmpressroom.com/post/america-then-and-now-1976-2026">rose to my defense</a> (and in one notable case, apologized) when the partisan vitriol got out of hand last month. Just another reminder that tempers are on a hair trigger in the society at large.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;Sometimes it&rsquo;s easy to get myopic and single-minded about markets, money, accumulation, investment, the rat race,&rdquo; says our next entry.
&ldquo;It&rsquo;s a pleasant diversion to see many of your readers have other interests and passions, regardless of what they are.&rdquo;
That&rsquo;s a reference to last week&rsquo;s mailbag thread where we went off on a high-end audio tangent. On the subject of my budget-audiophile NAD CD player, the reader adds: &ldquo;I can only say go NAD!
&ldquo;Hehe, some of us are juveniles too! :)&rdquo;
Dave: LOL, I remember seeing Corey Greenberg write, &ldquo;Go NAD,&rdquo; in the pages of Stereophile magazine in the early 1990s.
Greenberg was the young gonzo writer they brought in to shake up an otherwise stuffy editorial stable. My 20-something self thought his prose alone was worth the subscription price.
This was long before he sold out and <a href="https://www.washingtonpost.com/archive/lifestyle/2005/04/20/firms-paid-tvs-tech-gurus-to-promote-their-products/3624e757-381f-412a-8a19-de8f7e825e72/">took payments from companies to </a><a href="https://www.washingtonpost.com/archive/lifestyle/2005/04/20/firms-paid-tvs-tech-gurus-to-promote-their-products/3624e757-381f-412a-8a19-de8f7e825e72/">shill</a><a href="https://www.washingtonpost.com/archive/lifestyle/2005/04/20/firms-paid-tvs-tech-gurus-to-promote-their-products/3624e757-381f-412a-8a19-de8f7e825e72/"> their products</a> on the Today show.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;That audiophile change-up was a nice stress-buster,&rdquo; says another reader.
&ldquo;Much needed and a reminder of things that really matter. Thanks and the very best for upcoming weeks ahead as we will all be tested.&rdquo;
One more item of feedback, and there&rsquo;s not space to share the whole thing &mdash; but the reader had a suggestion: &ldquo;With all the ELP Tarkus talk, maybe you can get the guys to play &lsquo;Lucky Man&rsquo; for the announcement of the winner of the Trader Challenge!&rdquo;
Love it. Let&rsquo;s take it out today with <a href="https://www.youtube.com/watch?v=LDiLOMP9MNE&amp;list=RDLDiLOMP9MNE&amp;start_radio=1">their live version from the Royal Albert Hall</a> on their 1992 reunion tour&hellip;

FMF-Issue-050426-Featured

“So You Think You Can Trade” (Results)

<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-1-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-1_2x-new.png 2x" alt="1" width="37" />&ldquo;Tank Bottom&rdquo; Date: July 4
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The ceasefire in the Persian Gulf is now one month old. And while the guns aren&rsquo;t firing (for the most part), the noise is nonetheless deafening.
A deal is on, a deal is off. The president posts on social media, the war secretary holds a press conference, the Iranians put out a new Lego video.
Noise, noise, noise.
Once more, here&rsquo;s what matters most&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/qD2jsifipXRwzmigEVq0q/843acf906dc53266837c6db6ecebc31a/FMF-Issue-050826-1.jpg" alt="Daily crossing in Hormuz." width="540px" />
AAA says the national average price for a gallon of regular unleaded gasoline this morning is $4.55 &mdash; up from $4.17 a month ago and $3.15 a year ago.
Product is pricey &mdash; but it&rsquo;s still available.
That might not be the case in some spots by the Fourth of July &mdash; which, interestingly, is also a critical date for the Iranian side.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;When do storage tanks run empty?&rdquo; a Bloomberg TV anchor asked Carlyle Group&rsquo;s Jeff Currie yesterday.
When it comes to commodities, Currie is a vital voice outside of Paradigm that we follow closely.
His answer: &ldquo;It&rsquo;s going to be sometime in the month of May that you&rsquo;re going to end up with Europe hitting tank bottoms.
&ldquo;And in the U.S. it&rsquo;s somewhere in that July Fourth time period &mdash; if not sooner.
&ldquo;By the way, the inventories number coming out of the U.S. &mdash; the ones we got last night, the ones last week &mdash; I&rsquo;ve never seen anything like that before.&rdquo;
Overall crude inventories still look robust. But beneath the surface&hellip;
<ul>
<li>Fully 5% of the U.S. Strategic Petroleum Reserve has been drained since late March (and it was already near historically low levels)</li>
</ul>
<ul>
<li>Gasoline inventories are now 4% below the 5-year average for this time of year</li>
</ul>
<ul>
<li>Distillates inventories (diesel, fuel oil) are 11% below the 5-year average for this time of year.</li>
</ul>
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> As we&rsquo;ve mentioned in recent days, July 4 is also a date that looms large for Iran.
Last week, corporate media outlets reported that the U.S. blockade on Iranian ports is bottling up Iranian oil shipments to such an extent that there&rsquo;s nowhere to store it and the country&rsquo;s oil infrastructure will soon be damaged beyond repair.
Bloomberg even put a date on that point of no return &mdash; sometime between tomorrow and May 18.
We gave these reports the side-eye from the start. More objective observers examining the evidence and presenting their findings on social media figured Iran had two more months before reaching the bursting point.
Later that week, Ronald Reagan&rsquo;s budget director David Stockman ran the numbers and came to the same conclusion: Iran can stick it out until nearly the Fourth of July.
Now it seems that America is facing the same drop-dead date &mdash; for the opposite reason.
Eight weeks from tomorrow. Stay tuned&hellip;
➢ For the record: We have a new estimate of the Iran war&rsquo;s cost to the U.S. taxpayer: $72 billion for the first 60 days, according to Stephen Semler of the Center for International Policy.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-2-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-2_2x-new.png 2x" alt="2" width="37" />Insider Trading: Is the Denial a Confession?
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> About the skeevy-looking insider trading in the oil markets this week&hellip;
As we mentioned <a href="https://paradigmpressroom.com/post/groundhog-day-iran-edition">in real-time on Wednesday</a>, U.S. oil futures plunged when Axios reporter Barak Ravid reported that &ldquo;the White House believes it's getting close to an agreement with Iran on a one-page memorandum of understanding to end the war.&rdquo;
About an hour and 10 minutes before Ravid&rsquo;s report was posted, someone or a group of someones placed a $920 million bet on falling oil prices. It generated $125 million in profits in just 3&frac12; hours.
Later on Wednesday, an X account called &ldquo;The Hormuz Letter&rdquo; made a grave accusation&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/5B1kUs5TeFYyw9Ecm4TcgY/3823e99d2308896d1f583bf8f7651d4d/FMF-Issue-050826-2.jpg" alt="Hormuz Letter" width="540px" />
Background: The Hormuz Letter is an account launched last December. It claims to be Iranian although X says it&rsquo;s based in Europe. It&rsquo;s acquired nearly 50,000 followers, most of them since the war began.
So&hellip; who are these &ldquo;whistleblowers,&rdquo; exactly? White House insiders? Financial pros who know the ins and outs of market plumbing?
The Hormuz Letter did not say in any subsequent posts. Nor did it seem to be latching onto the reporting of any Western news outlet &mdash; nothing your editor could track down, anyway.
And so I blew the whole thing off as engagement bait on the part of The Hormuz Letter.
Until&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/6e5STviTXr3M98T9FOqEJ2/ff00b043429797ffa660e1a1b987904c/FMF-Issue-050826-3.jpg" alt="Barak Ravid Tweet" width="540px" />
Why on Earth would Barak Ravid deny a thinly sourced claim from an Iranian X account that&rsquo;s been around for less than six months?
Of course The Hormuz Letter hit back with the obvious rejoinder: &ldquo;The fact that you&rsquo;re denying it confirms it&rsquo;s true.&rdquo;
This much we know for certain: Barak Ravid is a veteran of Unit 8200, Israel&rsquo;s version of the National Security Agency. He&rsquo;s also been a reliable conduit for authorized leaks from the Trump administration for months now &mdash; including a handful of market-moving claims that peace is at hand.
&ldquo;Time after time,&rdquo; tweets the independent journalist Max Blumenthal, &ldquo;his &lsquo;reports&rsquo; are discredited and/or shot down by Iranian officials.
&ldquo;And now, everyone who&rsquo;s paying attention is onto him.&rdquo;
Moving on&hellip;
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-3-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-3_2x-new.png 2x" alt="3" width="37" />All-Time Lows, All-Time Highs
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> In addition to the war noise, the government&rsquo;s monthly jobs report figures into the market mix today.
The headline number was robust: The wonks at the Bureau of Labor Statistics say employers added 115,000 jobs in April &mdash; nearly double what the typical Wall Street economist was expecting. The official unemployment rate held steady at 4.3%.
The longer-term picture is still&hellip; concerning.
As we&rsquo;ve pointed out now and then in recent months, the fact the U.S. border has been effectively sealed for the last year changes the calculus when it comes to new jobs: In years gone by it took at least 150,000 new jobs a month to keep up with population growth. But without an influx of immigrants, the number could now be as low as 30,000.
Unfortunately, the average over the last 12 months is closer to 21,000. Not dire, but not great.
The report also says average hourly earnings grew 3.6% over the last year &mdash; which is more than the official inflation rate of 3.3%.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The numbers notwithstanding, wage earners don&rsquo;t feel as if they&rsquo;re keeping pace: The other big economic report today is consumer sentiment from the University of Michigan.
At 48.2 the number is still in the toilet &mdash; not quite record lows, but abysmal for a survey that&rsquo;s been conducted monthly since 1977. Asked what the inflation rate will be over the next 12 months, the average respondent said 4.5%.
Often this survey is little more than a reflection of how the stock market is doing. Not now &mdash; not with consumer sentiment near all-time lows and the market near all-time highs.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Speaking of the market near all-time highs&hellip; the S&amp;P 500 is on the way to its sixth-straight winning week.
At last check the index is up three-quarters of a percent to nearly 7,400 &mdash; more than offsetting yesterday&rsquo;s modest losses. The Nasdaq is likewise in record territory, comfortably surpassing 26,000. The Dow, as usual, is the laggard &mdash; barely in the green and still 350 points away from 50,000.
&ldquo;The chip stocks are soaring again today, leaving everything else in the dust,&rdquo; says Greg Guenthner at The Trading Desk. &ldquo;But this rally is stretched to the max, and it&rsquo;s starting to concern me. I&rsquo;d like to see some consolidation before it gets out of control.&rdquo;
Amid this rally, the Paradigm editors have racked up several wins in the last two days&hellip;
<ul>
<li>Readers of Enrique Abeyta&rsquo;s Breaking Profits bagged 227% in 13 months with shares of Quanta Services (PWR). And in Enrique&rsquo;s premium advisory The Maverick, long-dated call options on PWR generated 468% gains in less than a year</li>
</ul>
<ul>
<li>Meanwhile, Altucher&rsquo;s True Alpha readers collected 50% gains on the first half of a couple of trades, while letting the other half ride.</li>
</ul>
The aforementioned noise about the situation in the Persian Gulf has put U.S. oil futures at $94.68 &mdash; not much different from yesterday, but well below the $102 we saw at this time last week. (That&rsquo;s the power of a Barak Ravid article.)
Precious metals are gyrating around their late-April levels &mdash; gold over $4,700 and silver comfortably above $80.
Bitcoin is only a few bucks from reclaiming $80,000 while Ethereum rests at $2,281.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-4-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-4_2x-new.png 2x" alt="4" width="37" />Comic Relief
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> This one might have been around a few years ago, but it&rsquo;s relevant once more&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/hRN6LMZVIRQbeaht8rkZu/7722dcf3c003240259686f42b1c3c754/FMF-Issue-050826-4.jpg" alt="pub" width="540px" />
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-5-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-5_2x-new.png 2x" alt="5" width="37" />Mailbag: YOLO, California Fuel, Liquid Gold
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> In a reminder that we can&rsquo;t take certain things for granted here&hellip; a reader submits a three-word email after Greg Guenthner&rsquo;s guest essay yesterday: &ldquo;What is YOLO?&rdquo;
YOLO is short for &ldquo;You only live once.&rdquo; The term came to the fore after legions of young people entered the markets for the first time during COVID lockdowns in 2020&hellip; and really took off amid the frenzy over GameStop and other &ldquo;meme stocks&rdquo; in early 2021.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> On the subject of the last tanker of Persian Gulf oil arriving in California this week, we heard from someone in an inland county that votes reliably &ldquo;red&rdquo;...
&ldquo;I think this &lsquo;no oil-no gasoline&rsquo; crisis will be used by the California greenies to say, You should have bought your electric cars and solar panels, now look who&rsquo;s laughing.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Buck Sexton&rsquo;s reminder <a href="https://paradigmpressroom.com/post/groundhog-day-iran-edition">in Wednesday&rsquo;s edition</a> that &ldquo;when cash is king, gold gets sold&rdquo; prompted the following reader comment&hellip;
&ldquo;That is a great point &mdash; and it jibes with a recent <a href="https://www.macleodfinance.com/p/gold-differences-of-opinion">observation</a> by Alasdair Macleod: &lsquo;U.S.-centric pricing is a credible explanation for gold&rsquo;s performance&rsquo; re: why its price seems to be doing the opposite of what it should.
&ldquo;Lately, gold falls when the risk of war increases or the price of oil goes up, and rises when tensions ease.
&ldquo;Fun times!&rdquo;
Dave responds: Really, it&rsquo;s a point we can&rsquo;t emphasize often enough. In the short term, events occur that might lead you to believe gold should rise &mdash; but it doesn&rsquo;t. (As I like to say, should is the most dangerous word in all of investing.)
If there&rsquo;s a scramble for liquidity &mdash; margin calls, derivative bets gone bad, whatever &mdash; gold is one of the most liquid assets out there. It&rsquo;s easy to sell, so it gets sold.
The most instructive example is the 2008 financial crisis. Gold surpassed $1,000 an ounce for the first time in March of that year. But when the crisis went critical that autumn, it tumbled to nearly $700.
Then it began to roar higher &mdash; reaching a peak of $1,900 less than three years later.
But leave aside the liquidity issues: After the insane ramp gold experienced in January &mdash; from roughly $4,300 at the start to $5,600 at the peak, some sort of consolidation period before the next leg higher was inevitable.
And that&rsquo;s where we are now: Gold at $4,713 might not feel great. But if you&rsquo;re a long-term holder, take heart &mdash; $4,713 was a record high less than four months ago!

FMF-Issue-050826-Featured

“Tank Bottom” Date: July 4

FMF-Issue-050126(Featured)

The Day America Shut Down

<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-1-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-1_2x-new.png 2x" alt="1" width="37" />The Truth About Gas Prices
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> With no progress tamping down U.S.-Iran tensions, U.S. oil futures are up over 3.5% today to $103.57 &mdash; the highest since April 13.
Gasoline prices are following in tandem: The national average this morning is $4.23 a gallon, the highest since July 2022.
And it&rsquo;s tracking toward $4.30 soon according to GasBuddy&rsquo;s chief analyst Patrick De Haan. Big jumps are coming by midday today, he says, in the four states surrounding Lake Michigan thanks to ongoing production glitches at BP&rsquo;s big refinery in northwest Indiana.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> "If the U.S. is energy independent, why are prices higher HERE in the wake of the Iran war?" is a common question these days.
Yesterday on the Paradigm Press mobile app, our hedge fund veteran and jack-of-all-trades analyst Zach Scheidt served up an answer.
&ldquo;Even though the U.S. produces plenty of its own oil, crude is a GLOBAL market. And since prices are higher overseas, there is an incentive for U.S. producers to ship oil and collect higher prices from international markets.
&ldquo;More GLOBAL demand drives LOCAL prices higher.&rdquo;
With that in mind, Zach shared a chart showing the number of empty supertankers headed to the United States to load up and then head back overseas.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/KEFGiZQ3bWguhy5YcxLEm/3bd247c75deb93fd335601df25b29c99/5Bullets_Chart_oil_042926.png" alt="Empty Super Tankers" width="540px" />
Or as petroleum engineer Christine Guerrero puts it on her X account, &ldquo;You don&rsquo;t pay less for a T-shirt at Walmart just because you live in a different neighborhood. More reality checks coming as U.S. exports soar.&rdquo;
Much of that traffic will be headed to Europe &mdash; where most of the refineries are set up to handle the &ldquo;light, sweet&rdquo; crude that comes from America&rsquo;s shale patch. (Most American refineries were set up decades ago to handle the thick, sulfurous stuff that comes from Canada&rsquo;s tar sands and from Venezuela.)
We&rsquo;ll give the final word to GasBuddy&rsquo;s De Haan before we move on: Policymakers have a &ldquo;narrow window,&rdquo; he says, in which to bring about a full reopening of the Strait of Hormuz.
&ldquo;If that doesn&rsquo;t happen soon, Americans will start changing their summer travel plans &mdash; and they will NOT forget why when they head to the polls in November.&rdquo;
[Update: As we get closer to virtual &ldquo;press&rdquo; time WTI futures are now up 6.75% to $106.69. That&rsquo;s the highest since the U.S.-Iran ceasefire took effect on April 8.]
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-2-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-2_2x-new.png 2x" alt="2" width="37" />Markets Today: Suspended Animation
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The stock market is in a state of suspended animation &mdash; awaiting a decision from the Federal Reserve and earnings numbers from the biggest AI &ldquo;hyperscalers.&rdquo;
After the closing bell today, Amazon, Meta, Google and Microsoft all report their numbers &mdash; the first time it&rsquo;s happened in one fell swoop, if memory serves.
All four have been rallying in recent weeks &ldquo;despite still spending at historic levels,&rdquo; says Davis Wilson of our sister e-letter The Million Mission. &ldquo;This week, we find out if spending is still accelerating &mdash; or quietly slowing.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> But before those earnings figures drop, the Federal Reserve makes its next call on interest rates &mdash; presumably the final call under the chairmanship of Jerome Powell.
As usual, the decision is not in doubt: The Fed will hold its benchmark fed funds rate steady at 3.75%, where it&rsquo;s stood for over four months.
We await Powell&rsquo;s press conference &mdash; but it&rsquo;s likely he&rsquo;ll say that with the official inflation rate rising since the start of the Iran war, any rate cuts now would be like pouring gasoline on a fire.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/1Ce2HMlS7FpaoGAwrmu8Nn/f27408993980f6ef3f644b830163374c/5Bullets_Chart_Inflation_042926.png" alt="War is inflationary" width="540px" />
The April figures don&rsquo;t come out for a couple more weeks, but is there any doubt about the trajectory?
&ldquo;Inflation is well above the Fed&rsquo;s 2.0% target and is moving in the wrong direction,&rdquo; says Paradigm macro maven Jim Rickards.
&ldquo;Even 3.3% inflation will cut the purchasing power of $1.00 in half in just 21 years and half again in another 21 years.
&ldquo;In a typical working career of 42 years from age 23 to age 65, the dollar will lose 75% of its purchasing power with 3.3% inflation.
&ldquo;There&rsquo;s nothing benign about that rate and the Fed knows it. Lowering the inflation rate by keeping interest rates unchanged will be the sole focus of this FOMC meeting.&rdquo;
From here, who knows? Of course, Donald Trump wants lower rates &mdash; really, does any real-estate guy not want lower rates? &mdash; and he&rsquo;s made that stance clear to Kevin Warsh, his nominee to replace Powell.
Still, even if Warsh agrees with the president and pushes for lower rates, he has to persuade a majority of the 12-member Fed Open Market Committee to go along.
The next meeting with Warsh in charge is set for June 16&ndash;17.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Ahead of the Fed announcement and the big earnings reports, the S&amp;P 500 is adding slightly to yesterday&rsquo;s losses &mdash; down less than a quarter percent at 7,127. The Nasdaq is in similar shape; the Dow&rsquo;s losses are a bit steeper.
We&rsquo;re watching rising bond yields closely today: The yield on a 10-year Treasury note is bumping up against 4.4% for the first time all month. Last month, every time the 10-year touched this level there was some sort of conciliatory announcement from the White House aimed at lowering the temperature of the war &mdash; and lowering rates. Something to watch for especially with the oil spike today&hellip;
Precious metals are losing more ground, gold at $4,559 and silver at $71.56. Crypto can&rsquo;t get any traction &mdash; Bitcoin just over $76,000 and Ethereum at $2,276.
The big economic number of the day is durable goods orders &mdash; up 0.8% in March. This number is often skewed by orders for aircraft and military hardware, which are notoriously volatile month to month. Take those out and you get a category called &ldquo;core capital goods.&rdquo; This number jumped 3.3% in March.
That&rsquo;s a very healthy number &mdash; too healthy. It suggests businesses are rushing to place orders ahead of expected price increases.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-3-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-3_2x-new.png 2x" alt="3" width="37" />Power Grid Emergency
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The news got lost in the shuffle of war headlines last month &mdash; but here&rsquo;s a development with America&rsquo;s creaky power grid we shouldn&rsquo;t overlook.
&ldquo;The U.S. Department of Energy (DOE) announced it will invest $1.9 billion to accelerate improvements to the nation&rsquo;s electrical grid,&rdquo; says Paradigm natural-resources pro Matt Badiali.
&ldquo;Of course, this program has a stupid acronym: &lsquo;Speed to Power through Accelerated Reconductoring and other Key Advanced Transmission Technology Upgrades&rsquo; (SPARK).
&ldquo;What&rsquo;s important about SPARK is that it will accelerate the purchase of electrical components made in the U.S. from metals like aluminum, steel and copper. The DOE will announce the recipients of the money at the end of May this year.
&ldquo;To add to the urgency, the White House announced an executive order that marks America&rsquo;s electric infrastructure as critical to national defense under the Defense Production Act.&rdquo;
We&rsquo;ve been sounding the alarm about the grid in these pages for nearly four years. Rolling blackouts during hot weather were becoming a very real risk in mid-2022: Too many coal and nuclear plants were being retired, and the wind and solar coming online weren&rsquo;t nearly enough to replace it.
Starting in early 2024, we also led the charge in warning about the added stress that AI data centers would put on the grid &mdash; long before the mainstream caught on.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> But fixing the problem doesn&rsquo;t come cheap. 
The American Society of Civil Engineers says there&rsquo;s a $578 billion gap between planned spending on maintenance and what needs to be spent for upgrades.
&ldquo;There are only so many bandages you can put on a failing system,&rdquo; says Matt. &ldquo;At some point you need to tear the system down and actually fix it. That&rsquo;s why SPARK and the new executive order are so critical.&rdquo;
Key investing angle: &ldquo;The U.S. cannot make these grid upgrades without buying metals. Lots of them.&rdquo;
That will undoubtedly benefit the copper miners in Matt&rsquo;s Real Wealth Insider portfolio.
It will also benefit the aluminum giant Alcoa (AA). Matt talked up Alcoa in a special Martin Luther King Day edition of 5 Bullets last January. It&rsquo;s up a modest 4% since then, and the thesis is only getting stronger.
&ldquo;While electric motors must have copper,&rdquo; says Matt, &ldquo;transmission lines are primarily made of aluminum&hellip; and they are old.&rdquo;
The design of the power lines we use today dates back to the 1970s. Many power-industry experts believe that just replacing the old lines and conductors with new technology could double the grid&rsquo;s capacity.
Another tailwind: &ldquo;According to the Aluminum Association,&rdquo; Matt tells us, &ldquo;the U.S. needs about five new 750,000-metric‑ton primary smelters to &lsquo;fully meet current metal needs&rsquo;. That is roughly 3.75 million tons of additional annual capacity. The U.S. currently consumes about 5 million metric tons per year, across all sectors. That includes construction and packaging.&rdquo;
And that doesn&rsquo;t even get to the aluminum shortage resulting from the blockade of the Strait of Hormuz.
Bottom line: Aluminum is lucrative &mdash; and Matt says Alcoa is the only good way to play it at this time.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-4-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-4_2x-new.png 2x" alt="4" width="37" />Comic Relief
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> A grim chuckle courtesy of Bloomberg&rsquo;s commodity reporter&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/5Q0KEihv18OqdebFlkfnTq/3a030de9b82f068f2394e04cc461314f/FMF-Issue-042926-4.png" alt="pub" width="540px" />
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-5-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-5_2x-new.png 2x" alt="5" width="37" />Audiophile Mailbag
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Let&rsquo;s keep it light: Our musings <a href="https://paradigmpressroom.com/post/is-ai-suddenly-doomed">in yesterday&rsquo;s edition</a> about the revival of vinyl record sales prompted the following email from one of our longtimers&hellip;
&ldquo;Dave, Dave, Dave&hellip; Just when the readership was getting calmed down, you go and call us &lsquo;oldsters.&rsquo; LMAO! I know it was just meant in jest, but with all the riled-up readers lately, well, who knows how that will be taken?
&ldquo;But (the inevitable) let&rsquo;s talk about that costly endeavor of serious audiophiles. Yes, I&rsquo;m an &lsquo;oldster&rsquo; and proud of it! I also have an &lsquo;awesome&rsquo; (ah, you Gen-Xers) sound system. Carver 150-watt amp, SoundTech speakers and the turntable? A Bang and Olufsen Beogram horizontal turntable! (google it!).
&ldquo;Hope your editors keep churning out winners, as these new collector vinyls are running upwards of $120 nowadays. Jim, BTW, is doing a great job of that!
&ldquo;Then the wife (she&rsquo;s Chinese) needed me to add onto the sound system for her and her karaoke friends. We added a mixer board, mikes, a 12&rdquo;/CD silver-platter karaoke player. When we were younger our place was the place to party at! Yes, honey, do you need anything else? 😊
&ldquo;If that wasn&rsquo;t loud enough to wake the neighbors, my son recently handed me down his Logitech 500-watt, six-way surround sound system, because it was &lsquo;too much&rsquo; for his place. So now Dad has F-15&rsquo;s (think Top Gun) landing and taking off in my living room! He&rsquo;s a Gen-Xer too and I taught him well!
&ldquo;So Dave, go enjoy a cold microbrew (think I steered you away from light beer in &rsquo;23), you ELP-loving guy and crank on Tarkus on your budget system! I&rsquo;m going to enjoy a full-volume version, err, as soon as the wife goes shopping! LOL!
&ldquo;Still in your corner after all these years!&rdquo;
Dave responds: Hats off. That&rsquo;s hardcore.
Different strokes for different folks. An NAD CD player, an iFi headphone amplifier and a pair of Grado SR325 cans are all I need. Even today the whole shebang sets you back about $1,000.
Yeah and I&rsquo;m still not above a Miller Lite now and then. Can&rsquo;t be a Milwaukee Brewers fan otherwise, right?

FMF-Issue-042926-Featured

The Truth About Gas Prices

<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-1-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-1_2x-new.png 2x" alt="1" width="37" />Is AI Suddenly Doomed?
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Suddenly, AI stocks are falling out of bed.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/6JO1tK8OdIrcpHF3PngBM6/3fd8d9c0ca275b97398f62cec912eb90/FMF-Issue-042826-1.jpg" alt="OpenAi" width="450px" />
Early this morning, The Wall Street Journal posted a story that begins thus: &ldquo;OpenAI recently missed its own targets for new users and revenue, stumbles that have raised concern among some company leaders about whether it will be able to support its massive spending on data centers.&rdquo;
The story cites the usual &ldquo;people familiar with the matter&rdquo; as saying OpenAI&rsquo;s board is questioning CEO Sam Altman&rsquo;s efforts &ldquo;to secure even more computing power despite the business slowdown.&rdquo; In addition, CFO Sarah Friar is supposedly worried &ldquo;the company might not be able to pay for future computing contracts if revenue doesn&rsquo;t grow fast enough.&rdquo;
Because OpenAI is not (yet) a public company, there aren&rsquo;t any numbers to go on. We&rsquo;re taking everyone at their word here &mdash; the Journal, the Journal&rsquo;s sources and OpenAI&rsquo;s C-suite.
To its credit the Journal put a denial by Altman and Friar in the fifth paragraph. &ldquo;We are totally aligned on buying as much compute as we can and working hard on it together every day,&rdquo; says a joint statement that calls the article&rsquo;s premise &ldquo;ridiculous.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> For the moment, the market attributes more credibility to the Journal&rsquo;s sources than to Altman and Friar. 
Publicly traded companies adjacent to OpenAI are getting smoked today &mdash; Oracle down 4.3% as we write, CoreWeave down 5.7%, Nvidia down 3.5% after touching an all-time high yesterday.
That&rsquo;s dragging down the Nasdaq as a whole. At 24,552 the index is down 1.3% from yesterday&rsquo;s record high. Ditto the S&amp;P 500, down nearly three quarters of a percent from yesterday&rsquo;s all-time high, 7,123 at last check.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The price action is giving Paradigm&rsquo;s AI authority James Altucher a sense of deja vu.
He recalls only last month when Google announced it had developed software to make memory more efficient. The memory stocks like Micron (MU) and Astera (ALAB) took a 20&ndash;30% hit.
&ldquo;I recommended MU and ALAB then,&rdquo; says James &mdash; &ldquo;and they are both up significantly since then (MU from about 300 to over 500, for instance).
&ldquo;Similarly, I'd scoop up your favorite AI stocks at bargain prices that are being created today.&rdquo;
There&rsquo;s an undeniable tailwind, he says: About 86% of organizations plan to grow their AI budgets this year &mdash; and 40% expect growth of 10% or more.
Don&rsquo;t shed a tear for OpenAI, says James: He points out Google&rsquo;s Gemini AI platform has doubled its number of users in a little over a year &mdash; from 400 million to over 800 million now.
<a id="2"></a>
&ldquo;Even if OpenAI &lsquo;missed&rsquo; (they are at 800 million users versus the billion they expected at this time), AI spending and growth is up on every possible metric.
&ldquo;Spending on AI is not slowing down,&rdquo; he concludes. &ldquo;The media, as usual, is getting it wrong.&rdquo;
Speaking of questionable media narratives&hellip;
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-2-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-2_2x-new.png 2x" alt="2" width="37" />Is Iran Suddenly Doomed?
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The narrative of the week is that Iran has only days before its oil industry is wrecked for good.
That is, the U.S. blockade of Iranian ports means that Iranian crude has nowhere to go. Once all its storage is full, production has to shut down &mdash; causing damage to oil wells that might be irreparable.
Sounds serious, right? It started yesterday with a rather inelegant tweet from the U.S. Treasury secretary&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/7i2lqKevQVmvGeBzLwKiSs/67c1f9eb8c9b3ae30dd730875398f53c/FMF-Issue-042826-2.jpg" alt="Scott Bessent" width="540px" />
From there it was stovepiped through hawkish think tanks like the Foundation for Defense of Democracies and United Against Nuclear Iran.
Then it landed on the front page of today&rsquo;s Wall Street Journal&hellip;
<blockquote>Iran is scrambling to find new ways to store its oil, hoping to avoid a crippling production shutdown as a U.S. naval blockade bottles up its exports and negotiations to end the war remain deadlocked.</blockquote>
<blockquote>With oil backing up at home, Iran is reviving derelict sites known as &ldquo;junk storage,&rdquo; using improvised containers and trying to ship crude by rail to China.</blockquote>
And on Bloomberg&rsquo;s homepage&hellip;
<blockquote>Tankers laden with Iranian oil are clustering off Chabahar, a port in Iran that&rsquo;s outside the Persian Gulf but just shy of the U.S. blockade line.</blockquote>
<blockquote>Around six to eight supertankers were idling in waters near the port in the Gulf of Oman late last week, according to satellite images and analyses from United Against Nuclear Iran and maritime intelligence firm Windward, with more smaller tankers nearby.</blockquote>
Another Bloomberg story published yesterday put a date on the phenomenon: Iran would reach the point of no return sometime between May 9&ndash;18.
More objective observers, patiently examining the evidence and presenting their findings on social media, are reaching a different conclusion.
They&rsquo;re looking at satellite imagery of still-empty VLCCs, or very large crude carriers, bottled up in the Persian Gulf. They figure Iran can go another two months without cutting production.
Besides, when it comes to cutting production out of necessity, this isn&rsquo;t Iran&rsquo;s first rodeo&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/4FT77AL6bEspDqKd9PagkC/1e714fcabc8d951305565b5a67b0a431/FMF-Issue-042826-3.jpg" alt="EDF Hobbies tweet" width="540px" />
Two months is a long time. It almost gets us to Independence Day weekend &mdash; at which time U.S. gasoline prices would be&hellip; what?
Two months is longer than the &ldquo;election math&rdquo; in the United States probably allows.
Check back with us between May 9&ndash;18 and we&rsquo;ll see who turns out to be right.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> In the meantime, U.S. oil futures have sailed up to their highest level in over two weeks.
A barrel of West Texas Intermediate traded as high as $101.50 around 8:00 a.m. EDT&hellip; although it&rsquo;s since pulled back below $100.
Aside from the possibility of a return to a shooting war in the Persian Gulf after a three-week pause, the big story today is the United Arab Emirates announcing it&rsquo;s pulling out of the OPEC cartel.
The UAE is OPEC&rsquo;s No. 3 producer &mdash; and its government strenuously denies that the decision has anything to do with frustration over years of production cuts spearheaded by its frenemies in Saudi Arabia.
&ldquo;This has nothing to do with any of our brothers or friends within the group,&rdquo; UAE Energy Minister Suhail Al Mazrouei tells CNBC. &ldquo;We&rsquo;ve been working together for years and years. We have the highest respect for the Saudis for leading OPEC.&rdquo;
More believable is his claim about the timing: &ldquo;It will have a minimum impact on the price and it will have a minimum impact on our friends at OPEC and OPEC+.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Elsewhere in the commodity complex, oil&rsquo;s gains are translating to precious metals&rsquo; losses.
Gold is down over $100 at last check to $4,578 &mdash; approaching the lows of a month ago. Chart-watchers think $4,100 is still a distinct possibility as the Midas metal continues to consolidate after the dizzying heights of late January.
Silver, meanwhile, sits at three week lows &mdash; a hair below $73.
The risk-off atmosphere is spilling into crypto &mdash; Bitcoin back under $76,000 and Ethereum below $2,300.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-3-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-3_2x-new.png 2x" alt="3" width="37" />Elon: Paid in Planets
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;When was the last time a CEO got paid in planets?&rdquo; asks Paradigm tech-investing specialist Ray Blanco.
&ldquo;This morning,&rdquo; he tells us, &ldquo;Reuters got hold of excerpts from SpaceX's confidential S-1 &mdash; the registration statement that goes public next month. Buried in there is Elon Musk's compensation plan.
&ldquo;It's not a salary. It's a charter.
&ldquo;200 million super-voting shares unlock only if SpaceX hits a $7.5 trillion market cap and Elon plants a permanent human colony on Mars with at least 1 million people.
&ldquo;Do the math at $7.5 trillion and that single tranche is worth roughly $340 billion.
&ldquo;That's not Musk's salary. That's the unlock on one milestone. Hit it, and Elon doesn't just become a trillionaire.
&ldquo;He practically becomes the King of Mars.&rdquo;
Ray directs your attention to historical examples: &ldquo;In 1670, King Charles II handed the Hudson's Bay Company a royal charter granting it dominion over 1.5 million square miles of North America. Sovereignty. Trade rights. Governance.
&ldquo;The Dutch East India Company got something similar over Asia. So did the British East India Company over India.
&ldquo;Empire-building moments in human history that started with a charter that handed a private company the keys to a territory.
&ldquo;The SpaceX board just wrote one for Mars.&rdquo;
Much more to say in the run-up to SpaceX&rsquo;s IPO this summer. Stay tuned.
[Friendly reminder: Ray posted these musings a short time ago on the Daily Feed section of the Paradigm Press mobile app. The Daily feed delivers instant insights like these that frequently don&rsquo;t get published anywhere else.
What&rsquo;s more, the app is the easiest way to keep track of the buy and sell alerts of your paid publications &mdash; no sifting through email. Subscribers like you rave about the simplicity of the app. <a href="https://d2z65klgtz99km.cloudfront.net/PPG-App/">Download here</a>.]
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-4-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-4_2x-new.png 2x" alt="4" width="37" />Final Vinyl
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;Vinyl album sales in the United States increased for the 19th consecutive year in 2025,&rdquo; say the folks at Statista.
Figures from the Recording Industry Association of America show that sales bottomed in 2006 at less than one million. Last year&rsquo;s total was 46.8 million &mdash; both EPs and LPs.
The last time the number was anywhere near this high was 1988, six years after the introduction of the CD.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/6yOdxBLLLZymKnEGpmJrMH/de72c4b6156a4b5bfbc941ec242fb1e4/FMF-Issue-042826-4.jpg" alt="Vinyl" width="540px" />
&ldquo;Physical goods, it appears, still hold value for many people, even in the digital age,&rdquo; writes Statista&rsquo;s Felix Richter.
That&rsquo;s even if the goods go unused, serving as collectors&rsquo; items only; figures from Luminate say only 50% of vinyl buyers own a turntable.
It stands to reason. The vinyl revival seems driven mostly by younger folks who grew up on crappy compressed digital audio &mdash; MP3 downloads at the start, streaming audio now. They don&rsquo;t know any better and they&rsquo;re content to listen to vinyl records on some $50 Chinese-made &ldquo;Victrola.&rdquo;&nbsp;
Oldsters know that serious vinyl listening is a costly endeavor. The turntable, the tonearm, the cartridge (preferably from separate manufacturers), a quality record cleaning machine like the Nitty Gritty &mdash; too much for your budget-audiophile GenX editor!
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-5-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-5_2x-new.png 2x" alt="5" width="37" />Mailbag: PLTR Wants Your Son
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Last week&rsquo;s exploration of Palantir and its advocacy for a <a href="https://paradigmpressroom.com/post/pltr-wants-your-son">return to the draft</a> prompted the following reader reflection&hellip;
&ldquo;For many years now, I&rsquo;ve been thinking about the all-volunteer Army, especially after visiting South Korea.
&ldquo;When I was there in the early 2000s I was told that &lsquo;when Korean men are 15 or 16 they would protest the army and then when they came of age, they had to spend a couple of years in the army, keeping protesters in check. That service would mature them, teach them self-discipline and make them better suited to survive as civilians.
&ldquo;Looking at our young &lsquo;soyboy men&rsquo; today who seem to lack purpose, self-discipline and motivation, I wondered if a couple of years of military service might do them some good.
&ldquo;In addition to that, it would provide job training and reduce unemployment (especially in the inner cities, where it is most needed). It could be mandatory service in the National Guard at age 18 instead of the &lsquo;real Army,&rsquo; and then for those who liked military life (or had few job prospects at home) they could enlist in the real Army at age 20. Or use their newly acquired skills to find a job.
&ldquo;Or they could go to college a bit more mature and disciplined, ready to learn rather than just party. The program could possibly be designed to address the college debt issue as well.
&ldquo;This has nothing to do with a &lsquo;warmonger&rsquo; attitude but more looking at how &lsquo;men&rsquo; are turning out since we instituted the all-volunteer Army.
&ldquo;I haven&rsquo;t yet considered how this would apply to young women, never having been one. But a properly designed program might do them some good as well.
&ldquo;I always appreciate your thought-provoking commentary even when I disagree.&rdquo;
Dave responds: Thanks for writing. A few thoughts&hellip;
South Korea in the early 2000s was barely 15 years removed from military dictatorship. As admirable as its rise to a first-world democracy has been&hellip; is it a model to follow?
Here in the United States, men were men and we got along just fine without a peacetime draft until the late 1940s &mdash; when the &ldquo;wise men&rdquo; surrounding President Truman decided we should become a nation permanently mobilized for war.
So that suggests the problem now lies in society at large.
I get where you&rsquo;re coming from&hellip; but I don&rsquo;t share your confidence the military can credibly take on a social engineering project and step in where the culture has failed.
The culture needs to heal on its own. No, I have no idea how that would come about!

FMF-Issue-042826-Featured

Is AI Suddenly Doomed?

<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-1-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-1_2x-new.png 2x" alt="1" width="37" />Iran: The Only Thing That Matters Now
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> So&hellip; the war did not resume over the weekend, despite the massing of U.S. military assets in the Middle East at levels unseen in over two decades.
The ceasefire has held, more or less, since April 8.
In recent days, Paradigm&rsquo;s macroeconomics authority Jim Rickards has pounded away at a single theme across his publications.
&ldquo;It&rsquo;s critical to separate the geopolitical noise and signal coming from the Middle East and the war in Iran right now,&rdquo; he said in The Situation Report on Wednesday.
&ldquo;JD Vance&rsquo;s peace mission to Islamabad is noise. Trump&rsquo;s claim of bombing Iran into the Stone Age is noise. Iran&rsquo;s decision to skip the latest peace talks and threaten retaliation across the Persian Gulf countries if Trump resumes bombing is noise. The status of the ceasefire is noise.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> As Jim sees it there&rsquo;s only one signal amid the noise: &ldquo;The Strait of Hormuz has effectively been closed for nearly two months.&rdquo;
You don&rsquo;t need to see the numbers on this chart to get a picture of &ldquo;before&rdquo; and &ldquo;after&rdquo; when it comes to the number of ships exiting the strait under Tehran&rsquo;s selective blockade.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/2n0mSoDbvjLu9nSjye7vf2/be422f40e34ebf9d63fc42a5e5b8a3fb/FMF-Issue-042726-1.png" alt="Verified Outbound History chart" width="540px" />
Nor is there much inbound oil tanker traffic to speak of&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/SI5y30HoVhWvNJblkCtpQ/23e94d3ae1fc9c99942d4de58022de40/FMF-Issue-042726-2.png" alt="Tanker Chart" width="540px" />
&ldquo;Oil that has been delivered to South Korea, Japan and other countries in Asia recently came from tankers that left the Persian Gulf before the war began,&rdquo; Jim adds. &ldquo;It takes weeks to go from the Persian Gulf to East Asia. That &lsquo;floating pipeline&rsquo; has now dried up. The last vessels in the chain have unloaded. Reserves are now being drawn down.
&ldquo;In a matter of weeks, it will be time to shut down the factories and turn off the lights in much of the industrial world. Poorer countries will face starvation due to an absence of nitrates for fertilizer to grow crops that also come from the Persian Gulf.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Yes, Americans will avoid the worst of the consequences. Small comfort with gasoline about to jump back over $4 a gallon in many states.
Energy Secretary Chris Wright has forecast a return to sub-$3 gas next year; the president says it will happen much sooner.
&ldquo;The economics suggest otherwise,&rdquo; Jim wrote his Strategic Intelligence readers today.
&ldquo;Gasoline demand is what economists call inelastic. People have to buy it regardless of price because they need it for commuting, shopping and daily life. But there&rsquo;s no free lunch. Higher fuel costs come out of other spending &mdash; dining, travel, discretionary purchases &mdash; which quietly weakens the broader economy even as fuel demand holds up.
&ldquo;The closure of the Strait of Hormuz removes roughly 20% of global oil supply from circulation. Ignore futures prices near $100 per barrel. The spot price for immediately available cargoes is closer to $140 or higher.
&ldquo;The U.S. won&rsquo;t face shortages, due to domestic production, but it won&rsquo;t escape global pricing. Energy is a world market with a world price.&rdquo;
Jim says there&rsquo;s one scenario where gas prices would fall &mdash; &ldquo;a sharp slowdown in demand driven by recession. If consumption drops enough, oil prices will fall. But that outcome would come with rising unemployment and a broad economic contraction.
<a id="2"></a>
&ldquo;Lower gas prices would not be a sign of strength. They would be a symptom of something breaking.&rdquo;
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-2-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-2_2x-new.png 2x" alt="2" width="37" />Spirit Airlines, Troop Transport?
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The rationale for the Trump administration&rsquo;s rescue of Spirit Airlines is coming into view.
As mentioned briefly last week, the Trump administration is set to loan $500 million to Spirit in exchange for warrants that could give Uncle Sam a substantial stake in the firm.
On the surface, the move doesn&rsquo;t line up with the administration&rsquo;s previous acquisitions of equity stakes in public companies &mdash; MP Materials, USA Rare Earth, Intel and the like all have some sort of &ldquo;strategic&rdquo; value to the government. A budget airline? Not so much.
But on Friday, CBS News reported that the White House might resort to the Defense Production Act of 1950 to make the deal happen. &ldquo;The Pentagon would use Spirit's excess capacity for transporting troops, military cargo or other missions.&rdquo;
Sure enough, other struggling second-tier airlines want a piece of the action: A consortium of carriers including Frontier and Avelo have approached the government for $2.5 billion in help, according to The Wall Street Journal.
The Journal article didn&rsquo;t bring up the military angle &mdash; but certainly it&rsquo;s on the table.
And it doesn&rsquo;t suggest the war is winding down anytime soon, does it?
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> For a change, the week did not begin with some sort of effort on the administration&rsquo;s part to suggest peace is at hand, tamping down oil prices.
As a result, West Texas Intermediate futures are up nearly 3% on the day at $97.11 &mdash; on the high end of their trading range since mid-April.
The major U.S. stock indexes are in the red, but not by much. The S&amp;P 500 is down 0.15% at 7.154. The losses in the Dow and the Nasdaq are a bit steeper. Big movers include Shell &mdash; down 1.3% on news that it plans to acquire Canada&rsquo;s ARC Resources for $13.6 billion.
Microsoft is down a half percent after word that its ongoing breakup with OpenAI is moving to a new phase: Microsoft&rsquo;s license to OpenAI&rsquo;s intellectual property is no longer exclusive. And while OpenAI will continue to fork over a share of its revenue to Microsoft, the flow of funds in the other direction will stop.
➢ Meanwhile, congratulations are in order for PRO-level subscribers to Altucher&rsquo;s Investment Network. Friday they took 200% gains on POET Technologies after barely a month. (That&rsquo;s just the stock, not options!)
Precious metals are pulling back modestly, gold at $4,678 and silver at $75.09. Crypto is struggling for the next leg higher, Bitcoin just over $77,000 and Ethereum below $2,300.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Follow-up: Maine Gov. Janet Mills has vetoed a bill that would have temporarily paused construction of large-scale data centers.
We mentioned this bill a couple of Saturdays ago &mdash; part of a nationwide backlash driven by the perception that data centers are driving up electric bills.
Mills wanted an exemption for a data center currently under construction in the town of Jay &mdash; she said it would bring 800 temporary and 100 permanent jobs &mdash; but lawmakers wouldn&rsquo;t oblige. &ldquo;I supported the exemption and would have signed this bill if it had included it,&rdquo; says Mills.
An override in the legislature looks unlikely.
Maine was the first state where such a proposal reached the governor&rsquo;s desk. It likely won&rsquo;t be the last. We&rsquo;ll keep you posted.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-3-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-3_2x-new.png 2x" alt="3" width="37" />The IRS, Powered by Palantir
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Good news: The IRS is cutting personnel. Bad news: The IRS is replacing personnel with AI.
&ldquo;The agency plans to replace the nearly 30,000 employees it lost to Trump administration cuts with a new army of auditors, one that doesn&rsquo;t sleep,&rdquo; writes independent reporter Ken Kilppenstein.
Klippenstein has obtained documents laying out the IRS&rsquo; plans to force taxpayers&rsquo; compliance with, as one of the documents says, &ldquo;minimal human contact.&rdquo;
Key to the plans is software developed by&hellip; drumroll, please&hellip; <a href="https://paradigmpressroom.com/post/pltr-wants-your-son">the civic-minded folk at Palantir</a>.
The software &ldquo;allows IRS investigators and auditors to conduct &lsquo;near real-time data analysis&rsquo; through a custom tool called the &lsquo;Selection and Analytic Platform,&rsquo; or SNAP,&rdquo; Klippenstein continues.
&ldquo;What that means in practice is that millions of middle-income Americans who once fell below the threshold of what scarce human auditors could manage are now within reach. The little guy just became a lot easier to monitor at scale.&rdquo;
As we&rsquo;ve chronicled in the past, small-business owners and the self-employed are particularly subject to IRS shakedowns. They&rsquo;re not W2 employees and thus they can be nailed more easily for inflating deductions and (especially) underreporting income.
Go figure: The IRS personnel cuts engineered by Elon Musk and his DOGE boys &mdash; one of the few meaningful accomplishments they racked up last year &mdash; is clearing the way for tax collection to become more efficient and more ruthless.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-4-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-4_2x-new.png 2x" alt="4" width="37" />Comic Relief
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> This is wild &mdash; an AI-enabled mashup of 1970s decor, a 1990s Saturday Night Live bit and 2020s doomerism&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/iFvjCMDzjlONU8Dq5lfF9/f7bf86465570f85236bf536ae7f8e315/FMF-Issue-042726-3.png" alt="Comedic Relief" width="540px" />
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-5-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-5_2x-new.png 2x" alt="5" width="37" />Mailbag: Catch-Up Day
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> It&rsquo;s been several days since we&rsquo;ve had a proper mailbag &mdash; and we start with a follow-up to <a href="https://paradigmpressroom.com/post/limbo">Wednesday&rsquo;s edition</a> centered on the state of limbo between Washington and Tehran.
In particular, a reader overseas takes issue with the statement by Arta Moeini from the Institute for Peace &amp; Diplomacy: &ldquo;The current status quo places a greater burden on the Islamic Republic than on Washington.&rdquo;
&ldquo;I think that is a very U.S.-centric point of view. While the Strait of Hormuz is closed, most Asian countries, including some close U.S. allies, are close to running out of oil and LNG, and the pressure from those allies will become fierce in the next few days or weeks. European flights are already being cancelled for lack of jet fuel, and even if the strait was opened again tomorrow, it would take weeks or even months for demand and supply to stabilize again.
&ldquo;In the U.S., as many have pointed out, we are nominally energy sufficient, but if Trump starts trying to meet our allies' needs from U.S. production, we will soon see long lines at the pumps, with gas prices in double digits. If we don't help our allies, they may soon seek allies elsewhere.
&ldquo;And then there is China, who is hardly an ally, but on whom the U.S. is dependent for many critical items. People talk about rare earths, but even most medical supplies come from China, among many other things we don't think about until the shelves go bare.
&ldquo;In the end, I suspect that Iran is better positioned to endure another four&ndash;eight weeks of the current situation than is the U.S. Beyond that, who knows?&rdquo;
Dave responds: All good points. We just wanted to put a contrarian line of thought out there for consideration.
I too bristle at the nonchalance with which U.S. media approach the privation facing hundreds of millions of people as a result of this war. And not just in developing countries; depending on who you want to believe, Japan could be in a world of hurt in another 10 days or so. But as long as WTI futures stay under $100, almost no one seems to care&hellip;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;As usual, I'm fashionably late to the party, but I wanted to weigh in on the political vitriol issue,&rdquo; writes one of our semi-regulars.
&ldquo;A long time ago in a galaxy far, far away... (i.e. when I was in college) I read in a magazine article &mdash; something to the effect that the only reason to hate is fear.
&ldquo;My reaction was &lsquo;That's ridiculous! I KNOW hate and I don't fear the person I hate.&rsquo; Soon after, I received a letter from a friend with a single line in it that instantly transformed my hatred for that person to pity.
&ldquo;After a few years&rsquo; deep introspection I had to admit that there was something I had feared. It just wasn't obvious or easy to identify. My friend's letter changed the way I saw that person so that she no longer had the ability -- or more to the point I no longer gave her the power &mdash; to affect how I felt about myself. That is what I had feared.
&ldquo;And so I came to understand that the author of that article was correct: All hatred has fear as its root. Anyone who denies this isn't looking deep enough.
&ldquo;No matter where they are on the political plot chart, those of your readers who cannot bear any
criticism of their cherished political beliefs or praise for a position they don't share need to ask
themselves what it is they fear to make them so thin-skinned? You don't need me to tell you
that's on them, not you. I'm just saying it to let you know we rational readers know it too,
&ldquo;So if you are still at a loss for &lsquo;what to do,&rsquo; I have an answer for you: You keep doing you. You
aren't responsible for your readers' feelings or inability to confront their own fears.
&ldquo;Your incites... er... insights and those of other Paradigm editors give me perspectives on the issues I don't get elsewhere. I'm sure a very large majority of your readers agree with me. To those who don't... well, you know how to delete an email without reading it, don't you?
&ldquo;So, Dave, please don't &lsquo;do&rsquo; anything other than what you have been doing.&rdquo;
Dave: Gee, I forgot the part about &ldquo;what to do&rdquo; after the mailbag that <a href="https://paradigmpressroom.com/post/the-strait-is-open-maybe-sort-of">went off the rails</a> a week ago Friday.
But after the gracious responses of folks like yourself since, I&rsquo;ve decided to&hellip; keep on keeping on. Thank you kindly.

FMF-Issue-042726-Featured

Iran: The Only Thing That Matters Now

FMF-Issue-04-23-26-Featured

PLTR Wants Your Son

<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-1-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-1_2x-new.png 2x" alt="1" width="37" />A Ceasefire Until&hellip;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> So&hellip; a day later we&rsquo;re still in limbo.
After we hit &ldquo;send&rdquo; on yesterday&rsquo;s edition, the president announced he was unilaterally extending the ceasefire with Iran &ldquo;until such time as their proposal is submitted, and discussions are concluded, one way or the other.&rdquo;
In other words, he did not set an expiration date &mdash; instead putting the ball in Tehran&rsquo;s court.
The response from the adviser to Iran&rsquo;s parliament speaker was You do you, Donald.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/4zXILbCdwqOPJxpu1G0maI/79bb4738e5cab3d6a788c3fe14b128e1/FMF-Issue-042226-1.png" alt="pub" width="540px" />
&ldquo;The Strait of Hormuz remains closed. And Trump will continue the blockade on Iranian ports and ships,&rdquo; our Jim Rickards says on the Paradigm mobile app.
&ldquo;The danger hasn&rsquo;t passed yet. Economic damage will continue to pile up until a deal is reached. And a return to fighting remains possible.&rdquo;
By the way, that U.S. blockade on Iranian ports and ships is looking shaky. The Financial Times &mdash; citing figures from the cargo tracking group Vortexas &mdash; reports that at least 34 &ldquo;Iran-linked&rdquo; oil tankers have bypassed the blockade since it began nine days ago.
Not surprising. U.S. warships enforcing the blockade are spread thin, not least because they&rsquo;re staying out of the range of Iranian anti-ship missiles and drones.
At the same time, Iranian forces have seized two containerships that tried to run Tehran&rsquo;s blockade of the Strait of Hormuz.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> For the moment, however, Trump has what he wants &mdash; and the Iranian side does not.
When the ceasefire came into effect a couple of weeks ago, Quincy Institute executive VP Trita Parsi projected a possible outcome &mdash; &ldquo;no deal, no sanctions relief, no nuclear compromise, no return to war, while Iran continues to control the strait.&rdquo;
Which is where we stand more or less this morning. &ldquo;Not a stable situation,&rdquo; Parsi tweets now, &ldquo;but one in which Trump pockets the central thing he sought &mdash; exiting the war &mdash; while Iran is bereft of the main thing it was looking for: sanctions lifting.&rdquo;
&ldquo;The current status quo places a greater burden on the Islamic Republic than on Washington,&rdquo; agrees Arta Moeini from the Institute for Peace &amp; Diplomacy &mdash; &ldquo;a pressure that will only intensify so long as the blockade persists.&rdquo;
Which means as he sees it the status quo can&rsquo;t hold indefinitely: &ldquo;It's only a matter of time before Iran attempts to impose new regional costs of its own to break the U.S. blockade, a move that would likely collapse the fragile ceasefire entirely.&rdquo;
So where does this all leave the markets?
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-2-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-2_2x-new.png 2x" alt="2" width="37" />Markets Today: Oil up, Stocks up Too
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Because the tension level remains &ldquo;elevated,&rdquo; oil futures actually rose despite Trump&rsquo;s announcement. West Texas Intermediate is up over 3.5% at last check &mdash; two pennies shy of $93.
That&rsquo;s still vastly below the real-world price of &ldquo;wet&rdquo; barrels that we continue to spotlight &mdash; frequently in the neighborhood of $130.
Key point: May oil futures expire today. Keen observers of the oil market are noting that &ldquo;open interest&rdquo; &mdash; the total number of futures contracts that are not yet closed, expired or settled &mdash; have totally collapsed relative to a typical expiration day.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/5t4XvNFwOLmvr77IIIMKbD/c42d77cc9f51eb6622925b85b60d180e/FMF-Issue-042226-2.png" alt="pub" width="540px" />
But that real-world shortage continues to manifest in unlikely supply-chain snags.
From the BBC: &ldquo;The boss of the world's biggest condom maker, Karex, says the firm will raise its prices by up to 30% or possibly more if the Iran war continues to disrupt supplies of the raw materials [derived from oil] used in its products.&rdquo;
Karex, based in Malaysia, makes 5 billion condoms a year and supplies major global brands including Durex and Trojan.
&ldquo;The good news,&rdquo; one wag quips on X, &ldquo;is we&rsquo;re going to make a dent in the fertility crisis.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Meanwhile, the S&amp;P 500 is back to its record levels set last Friday &mdash; offsetting all of yesterday&rsquo;s and Monday&rsquo;s losses.
At last check the index is up nearly 0.9% to 7,125. The Nasdaq&rsquo;s gains are stronger, the Dow&rsquo;s a little weaker.
Among the big movers today is Spirit Airlines: The Wall Street Journal and Bloomberg report that the Trump administration is set to loan $500 million to Spirit in exchange for warrants that could give Uncle Sam a substantial stake in the firm. In bankruptcy, Spirit is a thinly traded penny stock with the ticker FLYYQ &mdash; and it&rsquo;s up over 32% on the day.
[Just in: Life comes at you fast. Make that 538%!]
Meanwhile, congratulations are in order for members of the Paradigm Mastermind Group. Yesterday they took profits of 220% in just under two years on Lincoln Educational Services. And today they bagged 309% in just under a year on Amkor Technology.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Forget the day-to-day stock market movement: Where do we stand in the big picture?
Paradigm senior investment director Enrique Abeyta passes along an updated chart from the folks at Bespoke Investment Group. It tracks the Nasdaq Composite&rsquo;s performance during the dot-com boom and the current AI boom.
It sets the starting point of the dot-com boom with the launch of the Netscape web browser in December 1994. And it sets the start of the current boom with the launch of ChatGPT 3.5 in November 2022.
Here&rsquo;s the latest chart, updated to reflect the volatility set off by the Iran war.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/3AIF7u7eyk8YhdsbrDdGNW/788806825bfb4894493dcff97affdd87/FMF-Issue-042226-3.png" alt="pub" width="540px" />
Interesting. If history rhymes, the volatility brought on by the war is analogous to the volatility brought on in 1998 by Russia&rsquo;s debt default and the resulting collapse of the hedge fund Long Term Capital Management.
Speaking of &ldquo;analogues,&rdquo; Enrique passes along a spooky stat from Bespoke: The S&amp;P 500 is up 17.8% so far during Trump&rsquo;s second term. The index was up 17.6% at this time in 2018 during Trump&rsquo;s first term.
➢ Checking the dollar prices for non-dollar assets: Gold is nearly flat after yesterday&rsquo;s beat-down at $4,734 but silver is up over a buck to $77.67. The real action is in crypto: Bitcoin is on the verge of $79,000 for the first time since early February and Ethereum is approaching $2,400.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-3-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-3_2x-new.png 2x" alt="3" width="37" />Scarce Electricity and the Uranium Boom
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> And now a shocking development in our ongoing chronicle of the super-stressed U.S. power grid.
In 2022 we started warning about the potential for rolling blackouts in some regions of the country. In 2024, long before the mainstream caught on, we warned that AI data centers would become <a href="https://paradigmpressroom.com/post/the-monster-that-ate-the-power-grid-ai">&ldquo;the monster that ate the power grid.&rdquo;</a>
Here&rsquo;s the latest, courtesy of Paradigm natural-resources pro Matt Badiali: &ldquo;The problem isn&rsquo;t just that we aren&rsquo;t adding new sources of electricity fast enough &mdash; it&rsquo;s worse. The U.S. is actually going backward.
&ldquo;The current administration killed somewhere around 30&ndash;35 gigawatts (GW) of new wind power. This includes TotalEnergies&rsquo; (NYSE: TTE) windfarms: 4 GW offshore North Carolina and New York, 10 GW offshore Virginia and 22 GW on federal lands.
&ldquo;Those are just a few examples of projects specifically killed by new legislation. Companies shelved or delayed another 266 GW (about 1,891 projects). That was due to tax credit rollbacks, permitting freezes and funding clawbacks.
&ldquo;I don&rsquo;t care what your political position is&hellip; we need electricity. All electricity. Give me solar. Give me wind. Give me coal. Hell, give me a hamster on a wheel&hellip;
&ldquo;Because if we don&rsquo;t have it, we ALL will pay much higher prices.&rdquo;
Oh, and those stories you might have seen about how rising gasoline prices are spurring renewed demand for electric vehicles?
&ldquo;Batteries aren&rsquo;t power sources,&rdquo; Matt reminds us. &ldquo;They must be filled up&hellip; with electrons instead of gasoline. The competition for those electrons will grow. Demand from data centers, artificial intelligence and EVs are all soaring.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> How to play it? &ldquo;Nuclear energy is one of the principal areas of energy growth,&rdquo; says Matt.
&ldquo;According to the World Nuclear Association, total capacity could reach 1,446 GWe (gigawatts electric) by 2050. That&rsquo;s up from 398 GWe today.&rdquo;
The scare from the Fukushima disaster in Japan in 2011 throttled the nuclear industry. Dozens of reactors were shut down across Europe. Nuclear energy made up over 15% of the global electricity mix in 2000&hellip; and less than 9% today.
&ldquo;The declining demand worked its way down to the uranium miners,&rdquo; says Matt. The capital fled. Production flattened out. In 2025, there was a 5.4 million pound supply deficit. By 2040, supply will hit 201 million pounds, up just 14% from 2025. Demand, however, will grow to 397 million pounds, up 118% from 2025.
&ldquo;This is a classic setup for higher uranium prices. And as with most mined commodities, the industry can&rsquo;t fix this before those prices go up.&rdquo;
This week Matt recommended an especially attractive uranium producer.for his Real Wealth Insider readers.
If you prefer to go the more conservative ETF route, there&rsquo;s always the Global X Uranium ETF (URA). [Dave&rsquo;s disclosure: I own some URA.]
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-4-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-4_2x-new.png 2x" alt="4" width="37" />Crypto Fraud, Strait of Hormuz Edition
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Go figure: Crypto fraudsters are making hay from the blockade of the Strait of Hormuz.
As you might be aware, the Iranian government is keen to collect tolls through the Strait of Hormuz &mdash; $2 million for the biggest oil tankers. And as you might have heard from colleague Chris Campbell at Altucher Confidential, that toll is <a href="https://altucherconfidential.com/posts/irans-bitcoin-tollbooth">payable in Bitcoin</a>.
So there&rsquo;s your context for this Reuters story&hellip;
<blockquote>Fraudulent messages promising safe passage through the Strait of Hormuz in exchange for cryptocurrency have been sent to some shipping firms with vessels stranded west of the waterway, said Greek maritime risk management firm Marisks&hellip;</blockquote>
<blockquote>Marisks on April 21 issued an alert warning shipowners that unknown actors, claiming to represent the Iranian authorities, had sent shipping firms a message demanding transit fees in cryptocurrencies, Bitcoin or Tether, for clearance.</blockquote>
On Monday it seems the captain of an Indian-flagged ship tried to transit the strait, believing he&rsquo;d ponied up the fee to the Iranian authorities on behalf of his employer.
He learned the hard way he had not&hellip; when the ship was hit by Iranian gunfire. He quickly turned tail.
For the record, the number of ships transiting the strait on any given day recently is in the single or low double digits. Before Washington and Tel Aviv launched the war on Feb. 28, it averaged 120&ndash;140.
[Update: The plot thickens. An official in India&rsquo;s Ministry of Ports denies the Reuters report. &ldquo;We spoke with the owner of the vessel&hellip; and he confirmed that it is fake news and no such incident had happened.&rdquo;]
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-5-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-5_2x-new.png 2x" alt="5" width="37" />Mailbag: Lowering the Temperature
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;Dave, glad to see you received a lot of supportive responses,&rdquo; a reader writes after <a href="https://paradigmpressroom.com/post/america-then-and-now-1976-2026">yesterday&rsquo;s extended mailbag edition</a>.
&ldquo;I think my favorite is the person who said he didn't remember subscribing to any of the reader's emails, LOL. It's your platform and I am thankful because it makes me know and think about subjects in a way I wouldn't otherwise.
&ldquo;I think a lot about so-called TDS &mdash; especially when it comes to you being attacked by both &lsquo;sides&rsquo; &mdash; and have come to the conclusion that TDS is not one-sided. It is suffered by both the people who think Trump is Hitler and can't do anything right and the people who think he is their savior and can't do anything wrong. Same disease, different symptoms :)
&ldquo;Keep doing your thing and if it ruffles feathers, then that probably means you are doing something right.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;Reading your received responses yesterday, I just want to say that I am quite happy to be included among what is shown to be a well-mannered and informed group of grateful readers,&rdquo; says another.
&ldquo;I well appreciate the scope and intensity of your daily inputs and the effort that goes into sharing them widely for such an affordable price.
&ldquo;You have added greatly to my personal perspective and enjoyable retirement of almost 30 years. Just your recommendation of Neil Howe&rsquo;s books has been a great source of personal reflection and understanding.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;Hey Dave, keep up the great work,&rdquo; says a third. &ldquo;I have cut back drastically on the daily emails I receive. Yours is the only one I look forward to reading. Love your unique perspective. I feel fully informed after reading it.
&ldquo;Regarding the division among us, it is created by the evil forces. Please remember, everyone, we need a revolution, not a civil war.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;Thank you for the work you do and your 5 Bullets, Dave,&rdquo; says our final correspondent today.
&ldquo;There is just so much noise and banter out there that has no substance. You obviously do and have done over the years a lot of digging and musing that just gives a different perspective.
&ldquo;And I think in such a nutso time as this that really helps people see the picture in a different light. Always look forward to what you have to say.
&ldquo;And Paradigm Press and the services I&rsquo;ve chosen have absolutely given my Roth a serious boost because of the thoughtful, expert advice from many different angles. But it&rsquo;s also fun, interesting and thoughtful.&rdquo;
Dave responds: Thank you, sir, for affirming why we do what we do.
And thanks to everyone who corresponded in recent days &mdash; especially the self-described longtimers who don&rsquo;t usually write. It&rsquo;s restored both my faith in humanity&hellip; and my conviction that this e-letter has the most informed and engaged readership in the business!

FMF-Issue-042226-featured

Limbo

<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-1-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-1_2x-new.png 2x" alt="1" width="37" />Limbo
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Everything feels as if it&rsquo;s in limbo today.
U.S.-Iranian talks may or may not be on, ahead of the ceasefire expiring tomorrow.
Donald Trump&rsquo;s choice for Federal Reserve chair is speaking to a Senate committee &mdash; but the nomination might not come up for a vote before the current chair&rsquo;s term is up next month.
Companies can now formally apply for tariff refunds &mdash; but the online &ldquo;portal&rdquo; is glitching and the timeline for payments is, shall we say, fluid.
About the only certainty is that Apple will remain in steady hands, a company veteran promoted from within to succeed Tim Cook as CEO.
Amid that backdrop, oil is up over 3% to $92.44. The major U.S. stock indexes are flat, the S&amp;P 500 just under 7,100. Precious metals are selling off, gold at $4,743 and silver under $77. Crypto is struggling for traction with Bitcoin below $75,000 and Ethereum just over $2,300.
Meanwhile, jet fuel sells for $200 a barrel &mdash; a development that&rsquo;s prompted Alaska Air to give up on providing earnings guidance to Wall Street analysts for the time being. ALK shares are down 4.7% on the day.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> While we wait for the next proverbial shoe to drop, we step back for an unusual 5 Bullets edition today.
The background: A reader mailbag that was already getting &ldquo;spirited&rdquo; this month turned downright &ldquo;hostile&rdquo; last week.
<a href="https://paradigmpressroom.com/post/the-strait-is-open-maybe-sort-of/#5">It culminated Friday</a> with one outraged reader saying our organization was aligned with &ldquo;the anti-democratic movement under the spell of a fascist from New York&rdquo;... and another coming from the other side of the political divide who advised your editor to pursue &ldquo;deep personal introspection and maybe professional assistance.&rdquo;
I said I&rsquo;d take the weekend to think over some sort of policy. The last time things were spinning out of control like this was during the 2024 presidential campaign. Then, addressing the situation was fairly easy: I refrained from any topic that entailed bad-mouthing a single presidential or vice presidential candidate.
But since there&rsquo;s no presidential election on the horizon now. I said I was at a loss for what to do.
I&rsquo;m still at a loss for what to do&hellip; but in the meantime, my predicament brought forth a small torrent of reader feedback.
Rarely do we devote the bulk of a 5 Bullets issue to the mailbag &mdash; but while everything is in limbo today, it seems like the thing to do.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;Dave, the two letters you highlighted Friday are the classic case of damned if you do, and damned if you don't. Keep up the good work,&rdquo; says one representative note.
&ldquo;Keep pushing buttons, LOL,&rdquo; says another.
&ldquo;I have a solution for all the people who have been bashing you,&rdquo; says a third.
&ldquo;There are a number of commentators out there that I have watched and/or read and don't agree with or like. Here's my solution &mdash; quit watching or reading. It works really well!
&ldquo;I, for one, appreciate receiving the FREE daily 5 Bullets. Don't always agree with everything written, however (no but there) always enjoy the quick, easy-to-read content. Same goes for the upsell emails from Paradigm.
&ldquo;Keep it up Dave, I appreciate you and your work.&rdquo;
A couple of the reader notes inspired some reflection. Read on&hellip;
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-2-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-2_2x-new.png 2x" alt="2" width="37" />Toxic Politics and Economic Anxiety
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;Yep, indeed, Brother Dave G, the rancor out here is off the bleepin&rsquo; rails,&rdquo; writes one of our regulars.
&ldquo;Most of us have one foot on an economic banana peel as a consequence of decades of economic betrayals. Manifests itself in all kinds of incivility.
&ldquo;So it ain&rsquo;t personal Brother Dave. You have zip to do with their/our rage other than holding the mirror up. (Might want to revisit some of the great work you&rsquo;ve done on this subject. Then again, might fill your inbox even more. LOL!)&rdquo;
Dave responds: Good reminder about economic insecurity.
There would have been no George Floyd riots in 2020 absent the economic anxiety brought on by COVID lockdowns. I said as much <a href="https://5minforecast.com/2020/06/02/were-all-hajis-now/">even as the riots were still underway</a>.
&ldquo;Two weeks to flatten the curve&rdquo; had become two months and counting. Expanded unemployment benefits were about to run out, and so was the eviction moratorium. In the end, they were both extended &mdash; but at the end of May 2020, legions of baristas and Uber drivers who&rsquo;d been cooped up in their crappy apartments had a legit fear they were about to be rendered penniless and homeless.
If it hadn&rsquo;t been George Floyd, it would have been some other catalyst.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> In the years since, the economic anxiety has taken on a weirdly partisan bent. 
During the Biden administration, Democrats lamented a &ldquo;vibecession&rdquo; &mdash; people complaining about their personal economic circumstances despite healthy GDP and job numbers.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/3A7os8NmP3NZHPc1sKe6dS/99e37e05dc105222f888e9558d022151/FMF-Issue-042126-1.png" alt="pub" width="540px" />
The partisan shoe landed on the other foot last year &mdash; Donald Trump denying any issues of &ldquo;affordability&rdquo; among the masses.
And with the Iran war now underway, Treasury Secretary Scott Bessent made a truly odd remark the other day&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/2Mr4IkvTnaDx6aeyUQrMFE/10068465460613587bdeeb4a2da535e6/FMF-Issue-042126-2.png" alt="pub" width="540px" />
Bottom line: No matter who&rsquo;s in power, sunny statistical aggregates never trump one&rsquo;s lived experience. It comes back to that joke from the 20th century about how a recession is when your neighbor is out of a job&hellip; and a depression is when you&rsquo;re out of a job.
Now onto some feedback I wasn&rsquo;t expecting in the least&hellip;
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-3-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-3_2x-new.png 2x" alt="3" width="37" />America Then and Now (1976&ndash;2026)
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;I have to apologize for any bashing I have done toward you recently,&rdquo; says one of the readers who&rsquo;d been taking me to task.
&ldquo;After reading about how you state that you were bashed from both sides in 2024 and still very badly in the toxic spring of 2026&hellip; I must say I very much liked your commentary on Friday. With the political atmosphere we have today it must be very difficult to decide how and what to put into print.
&ldquo;I am 71 years old and have lived through many difficult times and today&rsquo;s polarized atmosphere seems akin to the &rsquo;60s and &rsquo;70s.
&ldquo;Please accept my apology and please continue all your hard efforts to bring coverage of current events to all of us&hellip; even when some of us don't seem to appreciate it at times.&rdquo;
Dave: Apology accepted. Truly gracious.
You got me thinking here. I feel as if the atmosphere now is worse than it was in the &rsquo;60s and &rsquo;70s. Granted, I don&rsquo;t have teenage/adult memories of that era as you do &mdash; but with the nation&rsquo;s 250th birthday coming up, I&rsquo;ve been thinking about my recollection of the Bicentennial as a schoolboy in 1976.
I seem to remember people were happy to be Americans then &mdash; even in the shadow of Vietnam and Watergate and inflation and the oil shock &mdash; in a way we&rsquo;re not now.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> My working theory is that 50 years ago, the revulsion with the system was universal &mdash; transcending partisan lines. 
Think Peter Finch in Network: &ldquo;I&rsquo;m as mad as hell and I&rsquo;m not going to take this anymore!&rdquo;
People were disgusted, yes &mdash; but it wasn&rsquo;t a case of &ldquo;Everything would be fine if only my tribe were in charge and the people in the other tribe went away.&rdquo;
Everyone in charge of the system was scared they were losing the consent of the governed.
It was only in that atmosphere that the Church Committee was possible. The Beltway class felt as if the only way to retain their credibility was to start coming clean &mdash; even if it meant disclosing to the American people that their government had been spying on everyone from John Birchers to Black Panthers. For a few weeks, at least, it seemed as if the &ldquo;deep state&rdquo; of that day might actually be reined in.
Jimmy Carter was elected president in 1976 precisely because he was the first major-party candidate in decades who had no prior experience in Washington, D.C. (And when people felt Carter didn&rsquo;t work out, they turned to another D.C. outsider in Ronald Reagan.)
If you&rsquo;re into Strauss-and-Howe generational theory, none of this is especially surprising. The &rsquo;60s and &rsquo;70s were a &ldquo;Second Turning.&rdquo; There was strife, yes, but people didn&rsquo;t feel as if it was existential. Here in a &ldquo;Fourth Turning,&rdquo; they do. The stakes are perceived to be of Great Depression-World War II scale.
To truly appreciate the differences between then and now, ponder this tidbit from author Bryan Burrough, writing a decade ago in Time.
<blockquote>In a single 18-month period during 1971 and 1972 the FBI counted an amazing 2,500 bombings on American soil, almost five a day. Because they were typically detonated late at night, few caused serious injury, leading to a kind of grudging public acceptance. The deadliest underground attack of the decade, in fact, killed all of four people, in the January 1975 bombing of a Wall Street restaurant. News accounts rarely carried any expression or indication of public outrage.</blockquote>
Something like that nowadays would result in martial law, at least in the major cities &mdash; and a vicious vendetta by the party in power (whichever party that might be) against its perceived enemies.
Depressing stuff, but it&rsquo;s been on my mind. Thank you again for your magnanimity&hellip; and the chance to reflect alongside the readership.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-4-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-4_2x-new.png 2x" alt="4" width="37" />&ldquo;IdPol,&rdquo; 2026
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;Dave, identity politics has gripped people so tightly that any hint of criticism of someone&rsquo;s preferred overlord feels like a personal attack to many of these people,&rdquo; a reader writes.
&ldquo;I follow a Facebook page called Government Sucks and the admins there deal with the same thing. As a Libertarian, I am always accused of being on the &lsquo;other&rsquo; side whenever I point out a flaw on either side.
&ldquo;FWIW, this daily missive is worth well more than the zero dollars and zero cents I pay for it. Your somewhat unique ability to look past a partisan view of events adds a lot of value for your readers. If some people can&rsquo;t see past their own sense of indignation, they probably shouldn&rsquo;t be participating in a market that could not care less about their feelings.
&ldquo;What our overlords do and say does impact the markets we are trying to understand, and profit from. It would be remiss not to point out how these actions, on either side, affect our money.
&ldquo;Please keep doing what you do, exactly as you do. For each of the easily offended douche canoes who write in, there are probably multitudes more who appreciate what you do and how you do it. Try not to let the bitchers bother you. They&rsquo;re a minority, and their blind allegiances will hinder their success anyway.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;In response to the vitriolic responses that you have been trying to address recently in 5 Bullets, and particularly Friday, I wanted to send you some encouragement.&nbsp;
&ldquo;Thank you for providing us with your perspective on a wide range of issues. You&rsquo;ve read enough of these emails to be looking for a &lsquo;but,&rsquo; so I&rsquo;m trying hard to express this without using that word and to be honest, anything you write to which I object makes my thanks even more relevant because you are challenging my biases and perceptions.&nbsp;
&ldquo;I don&rsquo;t agree with all of your positions, because I like to think for myself and come to my own conclusions. Again, a but-less thank you from me.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;&lsquo;Deep personal introspection&rsquo;? LMAO!&rdquo; a reader responds to the second of Friday&rsquo;s heated emails.
&ldquo;Last I checked, this is a financial newsletter, not a self-help yoga guide to unlocking the mysteries of the universe. Ommmmm&hellip;
&ldquo;Don&rsquo;t sweat the comments from the losers with a digital megaphone. Nobody cares what their opinion is, despite their perceived self-importance. I don&rsquo;t recall subscribing to their newsletter.
&ldquo;And if you had no opinion whatsoever in the current sea of madness and stupidity, I&rsquo;d be more worried&hellip;&rdquo;
Dave: Exactly. You don&rsquo;t last long in this line of work if you go milquetoast, split the middle, play it safe.
That&rsquo;s what conventional financial media do all the time &mdash; and it&rsquo;s why readers seek out people like us in the first place. As I like to say, we&rsquo;re the original &ldquo;alternative media&rdquo; &mdash; going back a century to when Roger Babson was warning that the Roaring Twenties would end in tears. (It was not a popular opinion at the time!)
And actually, I did perform a bit of public introspection one day last May. It&rsquo;s about as personal as I&rsquo;ll ever get in these pages. For anyone who thinks I&rsquo;m too &ldquo;cynical,&rdquo; <a href="https://paradigmpressroom.com/post/9-11-the-financial-crisis-and-covid">it&rsquo;s worth a look</a>.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-5-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-5_2x-new.png 2x" alt="5" width="37" />Parting Thoughts
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Two more notes that I especially appreciate before we go&hellip;
&ldquo;Thank you for keeping &lsquo;The Five&rsquo; open for business as I&rsquo;ve accompanied you on this journey for at least the last 10 years. I appreciate the cutting-edge viewpoint with which to consider my choices for investing.
&ldquo;Your twin virtues of passion for your subject and your sense of humor are not lost on me and obviously on many of your readers. I love it when you print the rants from readers accusing you of being Trump deranged or a Trump toady &mdash; good news that you piss off both ends.
&ldquo;Congratulations! I know integrity when I see it and I&rsquo;m here for the next 10 years. Do continue.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;Man, some folks don't have a clue when someone such as you tries to keep them informed on all fronts,&rdquo; says our final correspondent.
&ldquo;I receive over 150 emails per day. Yours is the one I look forward to the most. Keep up the good work!&rdquo;
Dave: Thank you, thank you, thank you.
And thanks for the ride through this unusual edition of 5 Bullets. Back to regularly scheduled programming tomorrow &mdash; when presumably we&rsquo;ll be out of limbo.

SINGAPORE – JANUARY 16, 2024: A stamp printed in USA shows American Revolution Bicentennial, circa 1976
2413201215

shutterstock 2413201215

America Then and Now (1976–2026)

<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-1-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-1_2x-new.png 2x" alt="1" width="37" />Paper Oil
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Uhhh&hellip; You didn&rsquo;t really think there was a breakthrough in the U.S.-Iran conflict on Friday, right?
Your editor exercised <a href="https://paradigmpressroom.com/post/the-strait-is-open-maybe-sort-of">caution and skepticism</a> even as the news was still breaking &mdash; a stance that&rsquo;s vindicated here on Monday morning.
After we went to virtual press Friday afternoon, our macro maven Jim Rickards affirmed my suspicions on the Paradigm Press mobile app: &ldquo;President Trump and the Iranian mullahs agree on essentially nothing. Iran wants its frozen funds back and the U.S. naval blockade to end. Trump wants Iran&rsquo;s enriched uranium and the Strait of Hormuz fully open. Neither side will concede easily&hellip;
&ldquo;A return to war remains probable. Needless to say, markets have not priced this in.&rdquo;
We won&rsquo;t take up space with everything that happened over the weekend. Although the meme-o-sphere has summed it up reasonably well&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/2t8yzPcuzc4kTaZyIXQti8/2474447ae0d3d0554a56385e945355a6/FMF-Issue-042026_1_.jpg" alt="The Strait is open Meme" width="540px" />
Suffice it to say that today oil is up, stocks are down &mdash; and there&rsquo;s no Monday-morning &ldquo;stick-save&rdquo; that Trump has posted on his Truth Social site.
Still, at under $90 a barrel, the price of oil you see quoted in the media bears no relation to what&rsquo;s happening in the real world.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The disconnect has become maddening &mdash; at least for some folks who think about money for a living&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/3pB3kihU6bOheQNaVkeJ3H/e2174c341414fb28890ad60ffdf71bcd/FMF-Issue-042026_2_.jpg" alt="Market hitting all time highs tweet" width="540px" />
In large part, it comes back to the &ldquo;paper price&rdquo; of oil &mdash; that is, the price of oil futures quoted on CNBC &mdash; versus the price of physical barrels for delivery.
As we&rsquo;ve mentioned regularly in recent days, there&rsquo;s a yawning gap between the two; the real stuff trades for 50% more than the paper price.
As long as Brent and West Texas Intermediate crude trade under the round number of $100, the stock market thinks it&rsquo;s all good.
But real barrels trading for $150 or more tell a different story&hellip;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;The world is facing a historic energy crisis worse than prior energy supply crunches, including in 1973, 1979, 1987 and the 2020 pandemic,&rdquo; Jim Rickards wrote Thursday to his PRO-level members of Strategic Intelligence.
Wall Street bankers and brokers are locked into the narrative that the Strait of Hormuz will reopen in two&ndash;three weeks.
&ldquo;Of course,&rdquo; says Jim, &ldquo;they&rsquo;ve been saying two&ndash;three weeks for nine weeks. That&rsquo;s getting old.
&ldquo;On the other hand, we have experts who are in physical energy markets. They&rsquo;re not traders. They own tankers, buy and sell cargoes, operate loading and unloading facilities and run refineries. Some are government officials responsible for keeping the lights on and the factories running in places like South Korea and Japan.
&ldquo;These participants focus on one thing only &mdash; when the energy runs out, the lights go off. Data is no substitute for actual oil, natural gas or refined product.
&ldquo;What we&rsquo;re hearing from the market analysts is relentlessly optimistic, with some allowance for short-term inflation. What we&rsquo;re hearing from those in physical markets is dire and on the verge of panic.
&ldquo;Those in physical markets have it right. They can&rsquo;t pretend the way traders can.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> But don&rsquo;t take it from Jim. Take it from someone much closer to the situation &mdash; Saudi Arabian finance minister Mohammed Al-Jadaan.
In a remark completely overlooked by corporate media, Al-Jadaan spoke up during a conference late last week: &ldquo;You see the screen, $90 a barrel &mdash; good luck if you get an oil barrel for $90. It&rsquo;s $120, $130, $140, $150, $160 even through the last few weeks.&rdquo;
And those are just &ldquo;normal&rdquo; purchases of physical barrels in Europe and Asia. There are extremes like $286 a barrel in Sri Lanka &mdash; the island nation off the coast of India.
How long can this disconnect go on?
Answers shortly &mdash; after we remind you that these manipulations are nothing new&hellip;
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-2-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-2_2x-new.png 2x" alt="2" width="37" />The CIA and the Oil Price
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The market for oil futures has been used to mask a host of manipulations for over four decades.
The veteran oil industry journalist James Norman documented these manipulations extensively in his 2008 book The Oil Card.
Modern oil futures as we know them began trading in New York in 1983 &mdash; only months after President Reagan signed National Security Decision Directive 66. Under NSDD-66, Washington began colluding with Saudi Arabia to drive down oil prices. Objective: Make Soviet oil exports dirt-cheap and bankrupt the Evil Empire.
One of the leading global oil traders in the 1970s quickly became one of the biggest players in the nascent oil futures market. Transworld Oil, controlled by John Deuss, accounted for up to 30% of NYMEX oil trade &mdash; most of it on the short side, betting prices would fall. Deuss had long-rumored ties to the CIA&hellip; and it was CIA chief William Casey who did much to implement NSDD-66.
Crude traded around $30 a barrel at the time NYMEX oil futures began trading in 1983. By the late '80s, oil was in a range between $12&ndash;22. The Berlin Wall came down in 1989.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/47kWYqsMTuH7AnCycxD4pU/a070c30f6490ae890035c565703cb2f9/FMF-Issue-042026_3_.jpg" alt="1989 Photo of berlin wall coming down" width="540px" /> Made possible in part by cheap oil... [Photo reproduced by Wikimedia Commons user Lear 21]
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> More manipulations took place as oil climbed relentlessly during the early 2000s. 
The geopolitical objectives had shifted: High oil prices would act as a brake on Chinese economic growth. And the Commodity Futures Modernization Act of 2000 would help make it happen. The law "would eventually turn the oil futures market from mainly a zero-sum risk-hedging and price-discovery vehicle into a quasi-securities market," wrote Mr. Norman.
"The price of oil is now less dependent on the actual supply and demand for 'wet' barrels than on the huge sums of money pouring into NYMEX futures from the pension and other investment funds, tacitly enabled and encouraged by U.S. regulators. Daily oil volumes on the NYMEX now dwarf global physical oil consumption."
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> A decade ago, there were as many as 100 "paper barrels" of oil trading for each barrel of the real thing. Today that figure might well be much higher.
"The volumes are far, far out of whack with any reasonable need to hedge physical supply/demand risk," Norman told me during a 2013 interview. "The amount of funds needed to dramatically influence crude prices would be 'chump change' compared with the sums needed in the debt and equity markets."
So what&rsquo;s next? Clearly the objective now is not to achieve leverage against a geopolitical rival. It&rsquo;s simply to craft a perception that it&rsquo;s no big deal to lose over 10% of global oil production in one fell swoop.
Back to Jim Rickards: &ldquo;Financial markets will adjust to the physical reality soon, but not right away.&rdquo;
That&rsquo;s owing to how the physical oil market works. It takes a long time for oil tankers to move around the world. The final tankers that departed the Strait of Hormuz before the war started on Feb. 28? They&rsquo;re arriving at their destinations in Australia and Malaysia today, April 20.
So&hellip; as long as the June oil futures price is, say $100, why would you pay $140 for a real barrel today when you won&rsquo;t get delivery of that barrel until June anyway?
Unless and until the &ldquo;two&ndash;three week&rdquo; narrative breaks apart, the disconnect will go on.
We&rsquo;ll do our best here to keep track of real-world prices &mdash; and real world impact.
➢ Random notes about that real-world impact: The European Commission is recommending that Europeans revert to their 2020&ndash;21 work-from-home habits when possible. Meanwhile, Bloomberg reports that the loss of aluminum exports from the Gulf region is forcing companies like Toyota to cut back on production.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-3-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-3_2x-new.png 2x" alt="3" width="37" />Somebody Knew Something&hellip;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> And then there was the sketchy-looking trading that took place before all the news broke on Friday.
&ldquo;Investors placed a bet worth about $760 million on a falling oil price around 20 minutes before Iran's foreign minister announced on Friday that the Strait of Hormuz was open,&rdquo; reports the Reuters newswire &mdash; &ldquo;another sizeable wager on the world's most traded commodity ahead of major announcements in the course of the Middle East war.&rdquo;
Supposedly the Commodity Futures Trading Commission is looking into suspicious oil futures trades that took place earlier on March 23 and April 7. We&rsquo;re not holding our breath.
Checking the paper price for a barrel of West Texas Intermediate, it&rsquo;s up 5.2% as we write, back over $88.
The stock market sell-off today? Nothing major: At 7,094 the S&amp;P 500 is down less than a half percent from Friday&rsquo;s record close. The Nasdaq&rsquo;s losses are steeper, the Dow&rsquo;s narrower.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;Even as the S&amp;P has been grinding to new all-time highs, the sentiment picture has been deeply bearish,&rdquo; says Zach Scheidt, editor of The Income Alliance and analyst for several other Paradigm publications.
Zach is looking at the Bull/Bear Spread published by the American Association of Individual Investors &mdash; a measure of how retail investors feel about where the market is heading.
This figure &ldquo;actually turned more negative last week even as stocks made new records,&rdquo; says Zach. &ldquo;Nearly half of individual investors still believe the market will be lower six months from now.
&ldquo;This is the kind of wall-of-worry setup that fuels sustained rallies. When the crowd is bearish and prices are rising, it means someone else is doing the buying.&rdquo;
This lines up neatly with Jim Rickards&rsquo; observation above: Don&rsquo;t expect markets to adjust to the realities of physical oil shortages just yet.
Which is what will make earnings season so interesting in the next couple of weeks.
Companies are likely to report rising earnings &mdash; but what will their guidance be for the rest of the year? If it&rsquo;s cautious, the reaction could be swift and severe.
Note well: The rise in the S&amp;P 500 lately has been driven by outsized gains in the &ldquo;Magnificent 7&rdquo; companies. Five of them report their numbers next week &mdash; Microsoft, Google, Meta, Amazon and Apple.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The market for non-dollar assets is a mixed bag as the new week begins.
At last check, gold has inched back below $4,800 and silver is under $80 again. Bitcoin hovers just under $75,000 and Ethereum a little below $2,300.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-4-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-4_2x-new.png 2x" alt="4" width="37" />Editors out and About
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;Beautiful morning at Kennedy Space Center,&rdquo; said a note on Paradigm&rsquo;s internal e-chat yesterday from our tech-investing specialist Ray Blanco.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/KxBMdF9EAMTKDZ9H3b2Wg/85cb6fbc041bc5f83a6ad46953386ccb/FMF-Issue-042026_4_.jpg" alt="Beautiful Morning view of Kennedy Space Center" width="540px" /> The view at T-minus 4 minutes [Ray Blanco photo]
Ray was on hand as Jeff Bezos&rsquo; Blue Origin firm launched a satellite owned by AST SpaceMobile (ASTS) &mdash; a satellite that&rsquo;s key to the company&rsquo;s ambitions to deliver wireless service via the mobile phone you already have in your pocket.
Unfortunately, while liftoff was flawless, the mission was not. It was the first time Blue Origin successfully reused one of its New Glenn rockets. But the rocket&rsquo;s upper stage dropped off the satellite at the wrong destination &mdash; or as an ASTS statement put it, an orbit &ldquo;lower than planned.&rdquo;
Indeed, the orbit is too low for the satellite to be functional &mdash; and there&rsquo;s no way to push the satellite where it needs to go.
The company says it has insurance to cover eventualities like this, but ASTS shares are down 9% today.
Ray&rsquo;s conviction in the company, however, remains strong: The company has launch contracts with space firms other than Blue Origin. It still expects to launch 45 of these satellites by year-end &mdash; although with this mishap that&rsquo;s down now from the initial goal of 60.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The defense sector is showing its stuff this week at the Sea-Air-Space conference near Washington, D.C. &mdash; and our Byron King is on hand.
In addition to his energy-and-mining cred, Byron has a 30-year background as a Navy flight officer and former staffer with the Chief of Naval Operations.
&ldquo;From the outside looking in, it's hard to know what's happening. Which is why I'm here on the inside, looking around,&rdquo; he tells us.
Among the things he&rsquo;s seen: &ldquo;Huntington Ingalls (HII) has a beautiful model of a Ford-class aircraft carrier at its exhibit space. And look at what's sitting on the No. 3 catapult... an MQ-25 &lsquo;Stingray&rsquo; drone, built by Boeing (BA).&rdquo;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/7sz1AVmP3VNMKbRa6azMmC/be4411c885e3e4cd18711e4414623dc7/FMF-Issue-042026_5_.jpg" alt="Beautiful Model Of Ford Carrier" width="540px" /> Scaled down for conference-floor presentation, not actual size [Byron King photo]
&ldquo;No pilot: just electronics that can work under AI, or accept external control and be part of a flying package. If it looks &lsquo;stealthy,&rsquo; that's because it is kinda stealthy; great design. Inside this bird are fuel tanks that can carry about 15,000 pounds of JP-5 jet juice, to transfer inflight to accompanying F/A-18s, F-35s, E-2s and more. Then it returns to the ship and lands automatically.
&ldquo;By using a dedicated tanker drone, the Navy saves wear and tear on F/A-18s, which have long been tasked with that role. But now, planners can utilize those F/A-18s for other missions.&rdquo;
Byron is posting regularly from the conference to the Paradigm mobile app. If you haven&rsquo;t downloaded it yet, it&rsquo;s a great source for exclusive app-only content &mdash; as well as the easiest way to keep up with the buy and sell alerts from your paid subscriptions. (No sifting through email!) <a href="https://d2z65klgtz99km.cloudfront.net/PPG-App/">Download here</a>.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-5-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-5_2x-new.png 2x" alt="5" width="37" />And Finally&hellip;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> No comic relief today &mdash; just a reminder of what happened 251 years ago yesterday&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/2Msufq3IiZCGpJsIixLrBa/bf2b72f66a7813c04d7abc0a8f6ff8da/FMF-Issue-042026_6_.jpg" alt="Memorial 1775" width="540px" />

FMF-Issue-042026(Featured)

The CIA and the Oil Price

<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-1-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-1_2x-new.png 2x" alt="1" width="37" />The Strait Is Open! (Maybe, Sort Of)
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> For once, it&rsquo;s someone other than Donald Trump issuing a market-moving tweet. 
Specifically, the Iranian foreign minister&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/4KX3QptU1TT7zmgFsZVTkA/b20b22585110782a3e30fa99c518291a/FMF-Issue-041626-1.png" alt="Iranian foreign minister" width="540px" />
That was at 8:45 a.m. EDT. The reaction in the &ldquo;paper price&rdquo; of oil was immediate &mdash; futures on West Texas Intermediate crude sinking more than 13% to $82.21, a five-week low.
And then the U.S. president weighed in&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/3SWJvHZk166XrUw9RFk626/7e350456a87d8e0849701d4bf41592ae/FMF-Issue-041626-2.png" alt="Trump Tweet" width="540px" />
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> To the extent that it&rsquo;s possible to take a step back amid fast-moving developments like these, let&rsquo;s do so.
In the first place, no one in Tehran has ever said the Strait of Hormuz was &ldquo;closed.&rdquo; On March 22, the foreign minister himself said the strait is &ldquo;not closed. Ships hesitate because insurers fear the war&hellip;&rdquo;
The Iranian government enforced a selective blockade &mdash; with the implicit threat that ships attempting to transit the strait without permission would be destroyed.
Before Washington and Tel Aviv launched their war on Tehran Feb. 28, about 120 ships passed through the strait each day. Since then that number has been slashed by 90%.
Let&rsquo;s see what the numbers are this weekend.
Besides, the terms of this &ldquo;reopening&rdquo; seem open to interpretation. As you see above, Tehran says it hinges on a 10-day cease-fire in Lebanon sticking&hellip; but Donald Trump says, &ldquo;This deal is not tied, in any way, to Lebanon.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> But let&rsquo;s assume the best and that peace is, as they say, &ldquo;at hand.&rdquo;
There&rsquo;s still a problem that colleague Sean Ring spotlighted Monday in The Rude Awakening. &ldquo;Even if The Donald announced a ceasefire tonight, the spigots don't just reopen.
&ldquo;Shut-in wells don't restart cleanly, due to reservoir pressure problems, viscosity issues or damaged infrastructure. LNG liquefaction plants can't simply be switched back on. They cool gases to hundreds of degrees below zero through enormously complex systems. Just flick a switch? Doesn&rsquo;t happen.
&ldquo;And then there's insurance. Lloyd&rsquo;s of London is an intelligence operation that also writes shipping insurance policies. When the bombs dropped, the policies vanished. Every single ship, cargo and crew needs its own bespoke coverage review before they move. Thousands of vessels. No AI shortcut. No batch processing. And no American company is taking its place.
&ldquo;Someone has to be the first tanker captain through the strait after the ceasefire.&rdquo;
Again, let&rsquo;s see how many tankers transit the strait this weekend.
OK, more about the market reaction next&hellip;
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-2-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-2_2x-new.png 2x" alt="2" width="37" />Euphoria
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> As you might expect, sinking oil prices translate to soaring stock prices.
The S&amp;P 500 is on track to end the week at record levels &mdash; up 1.25% as we write to 7,129. The Nasdaq is likewise in record territory, up 1.5% and approaching 24,500. The Dow is up strongest &mdash; a little over 2% &mdash; but it still has work to do to reach a record.
Gold sits at a five-week high of $4,869. And the crypto rally is getting a head of steam &mdash; Bitcoin approaching $78,000 and Ethereum at $2,444.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Don&rsquo;t count out silver yet.
For a sixth year running, silver demand will outstrip silver supply &mdash; according to a new survey commissioned by the Silver Institute.
Supply remains steady &mdash; but it can&rsquo;t keep up with rising demand.
Interestingly, the survey suggests that industrial demand for silver will drop 3% this year. It seems the high price of silver is prodding the makers of solar panels to start looking for silver substitutes.
But investment demand is only getting stronger. &ldquo;You could see losses in the industrial sectors being mopped up by the retail investment,&rdquo; says Philip Newman of the British research firm Metals Focus, which conducted the survey. &ldquo;It&rsquo;s not out of the realms of impossibility,&rdquo; he tells Kitco News.
Demand for coins and bars is forecast to rise 18% this year to its highest level since 2022. India is a source of growing demand because while silver isn&rsquo;t as cheap as it once was, it&rsquo;s still a lot cheaper than gold.
Meanwhile, demand for silver via ETFs and similar products remains robust.
Checking our screens, silver&rsquo;s rallying much harder than gold today &mdash; up over four bucks to $82.65. That&rsquo;s nowhere near the hyperbolic $120 highs of late January &mdash; but by the same token, an ounce of silver a year ago at this time was only $32.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-3-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-3_2x-new.png 2x" alt="3" width="37" />A Satellite Phone for Everyone
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;A flying cell tower,&rdquo; is what our tech-investing specialist Ray Blanco calls it. And he&rsquo;ll be on hand as it&rsquo;s launched into orbit this weekend.
&ldquo;At 6:45 a.m. EDT Sunday, Blue Origin's New Glenn-3 is scheduled to lift off from Launch Complex 36 at Cape Canaveral carrying a single payload: BlueBird 7.&rdquo;
That&rsquo;s a satellite developed by AST SpaceMobile (ASTS) &mdash; &ldquo;the world's first and only direct-to-cell space broadband company,&rdquo; Ray says.
&ldquo;BlueBird 7 isn't just another satellite. It carries the largest communications array ever deployed to low Earth orbit &mdash; a phased-array antenna spanning roughly 2,400 square feet.&rdquo;
So yes, a flying cell tower &mdash; &ldquo;engineered to connect directly to the unmodified smartphone already in your pocket,&rdquo; Ray says. &ldquo;No dish. No &lsquo;satellite mode.&rsquo; Just 120-plus Mbps of broadband from space to your regular iPhone or Android.&rdquo;
As Ray said in this space last month, ASTS hopes to have as many as 60 of these satellites in orbit by year-end.
&ldquo;As a shareholder, I was invited to watch the launch from Kennedy Space Center alongside other qualified holders. I'll be on the 4:15 a.m. bus with my kids &mdash; who, for the record, are more excited about the rocket than the ticker!&rdquo;
We&rsquo;ll hear from Ray post-launch on Monday&hellip;
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-4-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-4_2x-new.png 2x" alt="4" width="37" />Comic Relief
<a id="5"></a>
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> And now a guffaw that has nothing to do with war or the cost of living&hellip;
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/32WT33knkr51vTRLSlmxzl/451d92d222871d92fe1049df951ed286/FMF-Issue-041626-3.png" alt="Comic Relief back to the future" width="540px" />
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-5-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-5_2x-new.png 2x" alt="5" width="37" />Vitriol
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The following email landed in our inbox after <a href="https://paradigmpressroom.com/post/trumps-next-tax-cut">yesterday&rsquo;s edition&hellip;</a>
&ldquo;OK, I thought you were reasonable, economically oriented professionals that weren't beholden to the stupid, immoral fraud we unfortunately have as our president. And I thought you might have a unique and interesting take on our economic framework.
&ldquo;But now it's clear where your political ideals lie and it's with the anti-democratic movement under the spell of a fascist from New York.
&ldquo;I will never donate another dollar to your cause. Count me out!&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> From the other side of the political divide, the following email also landed in our inbox after yesterday&rsquo;s edition&hellip;
&ldquo;I am becoming increasingly uncomfortable with the previously veiled commentary I noticed, which you started about a year ago. This is not why I&rsquo;ve paid nearly $1,000 a year.
&ldquo;I&rsquo;m deeply disappointed, and your recent inappropriate, unprofessional and juvenile response to one of the letters yesterday proves that you just can't keep your personal political views separate.
&ldquo;Deep personal introspection and maybe professional assistance are in order. I may need to stop reading your 5 Bullets, which I found to be the least helpful of all the material I&rsquo;ve considered over the past year from Paradigm Press. It makes me sad, but life goes on &mdash; things change.&rdquo;
First, this is a good time to reiterate that this e-letter is a free benefit stacked on top of your paid subscription.
But beyond that&hellip;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> During the 2024 election campaign the atmosphere in this country became so heated that for a little while I implemented a policy: I would refrain from addressing any topic that entailed bashing a single presidential or vice presidential candidate.
I implemented the policy after I <a href="https://paradigmpressroom.com/post/in-defense-of-childless-cat-ladies">tried</a> to address serious economic issues playing off a remark JD Vance made about &ldquo;childless cat ladies&rdquo; &mdash; and the reaction <a href="https://paradigmpressroom.com/post/worse-than-a-crash#5">went off the rails</a>.
If the atmosphere in the summer of 2024 was heated, the atmosphere in the spring of 2026 is toxic. But since it&rsquo;s not a presidential election year, I&rsquo;m not altogether sure what policy I can implement now to lower the temperature.
Mercifully, the weekend is upon us. Without deadline pressure, maybe I&rsquo;ll come up with something. And maybe cooler heads can prevail soon&hellip;

FMF-Issue-041626-Featured

The Strait Is Open! (Maybe, Sort Of)

<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-1-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-1_2x-new.png 2x" alt="1" width="37" />Trump&rsquo;s Next Tax Cut
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Even before the Iran war propelled energy prices higher, the buzzword of the 2026 midterm elections was shaping up to be &ldquo;affordability.&rdquo;
That&rsquo;s the label Democrats hope to tag on Donald Trump.
They can&rsquo;t very well use the word &ldquo;inflation&rdquo; &mdash; because that&rsquo;s the label Joe Biden and Kamala Harris got tagged with in 2024.
But whatever label you want to use, or whoever you want to blame, it&rsquo;s the defining economic issue of the decade. The incumbent president, whoever it is, must grapple with it every two years if his party is going to have a prayer of competing.
In the last round of midterms four years ago, the biggest stunt Joe Biden pulled was to drain the Strategic Petroleum Reserve &mdash; at rates unprecedented in the SPR&rsquo;s history.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/5CnRcDE3H48Gj0qBcEZnCO/a250f9343281fc8801092ef08398c3dd/5Bullets_SPRchart_0416.png" alt="pub" width="540px" />
&ldquo;The Biden Bleed&rdquo; helped bring gasoline prices down from $5.10 a gallon in June to $3.88 by Election Day. It still wasn&rsquo;t enough to prevent Republicans from taking narrow control of the House.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> So what can Donald Trump do &mdash; with the national average gas price this morning of $4.09?
His administration has already pledged to draw 172 million barrels from the SPR &mdash; an amount that would bring the SPR&rsquo;s level down to where it is on the very left of that chart.
But this time that won&rsquo;t be enough to move the needle on fuel prices.
The supply shock from the Iran war is more severe than from the Russia-Ukraine war. Then, oil was simply rerouted from one place to another to bypass Western sanctions. Now it&rsquo;s bottled up inside the Strait of Hormuz with nowhere to go.
The president himself acknowledged on Sunday that by autumn, gas prices &ldquo;should be around the same.&rdquo;
So what else can he do?
The question here today isn&rsquo;t what should he do. It&rsquo;s what we can reasonably expect him to do under the circumstances. And the circumstances require him to do something big and splashy that everyday Americans would give him credit for. Read on&hellip;
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-2-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-2_2x-new.png 2x" alt="2" width="37" />Something Big
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The &ldquo;something big&rdquo; that most readily comes to mind can be captured in three words: Payroll tax holiday.
The proposition here is simple: Lift the 6.2% withholding tax on Social Security and the 1.45% withholding tax on Medicare. Do it for maybe nine months. Six is too short and too obviously an election ploy. Twelve is too long and makes it look as if an unpopular war will be dragged out indefinitely. Nine is just right.
The feds would still collect the employer portion of payroll tax. The idea would be to create the appearance of an instant pay raise for every W2 employee in the land.
Trump and congressional Republicans could frame it as a gift to the American people for the nation&rsquo;s 250th birthday. And of course they&rsquo;d pass it sometime in late spring or early summer &mdash; just in time to make that Fourth of July trip a little more affordable.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The impact would be felt most among the working class and the poor &mdash; the bottom 50% of Americans who don&rsquo;t own homes or stocks.
After all, payroll taxes apply to wage income &mdash; the sole source of income for most of the bottom 50%. Wealthier households collect income from more diverse sources &mdash; interest, dividends, capital gains, business profits. What&rsquo;s more, Social Security tax isn&rsquo;t collected on wage income exceeding $184,500. (The figure rises with inflation each year.)
There&rsquo;s precedent here: The Obama administration and a Democratic Congress trimmed the employee portion of Social Security tax from 6.2% to 4.2% in 2011&ndash;12. And during the early days of COVID in 2020 there was chatter inside the Beltway about a full payroll tax holiday through year-end 2020 &mdash; although nothing came of it.
Would a payroll tax holiday drain the Social Security and Medicare trust funds &mdash; at a time when both funds are already on track to be emptied by 2032&ndash;33? Of course it would. Democrats would object on those grounds &mdash; even though they&rsquo;d resort to the same tactic if they were in charge.
Fiscal-hawk Republicans would object on the same grounds &mdash; but in an election year and under pressure from the White House, they&rsquo;d go along to get along.
Again, the question today isn&rsquo;t whether it&rsquo;s wise or foolish policy. The question is what&rsquo;s most likely to happen when &ldquo;affordability&rdquo; is the buzzword and the election math doesn&rsquo;t look too good for the Republicans.
If it happens, you heard it here first&hellip;
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-3-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-3_2x-new.png 2x" alt="3" width="37" />Manipulation, She Wrote
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> Even mainstream analysts are catching onto the disconnect between the price of oil futures and the price of actual barrels for delivery.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/4G7YGpbiP8Mr4SENHxDMyK/e0f3db906f5affc7e628a6d66d22b043/FMF-Issue-041626_2_.png" alt="pub" width="540px" />
&ldquo;Manipulation&rdquo; is a strong word for someone who used to work for the Reuters newswire. But these days she works for the giant trade-data firm Kpler. It&rsquo;s her business to know the price of real-world barrels that help move goods across continents and oceans.
And as we&rsquo;ve been chronicling for weeks now, that real-world price is substantially higher than &ldquo;paper oil.&rdquo;
Brent crude futures &mdash; the global benchmark reflecting North Sea oil &mdash; trade for under $100. But actual &ldquo;Forties&rdquo; crude brought up from under the North Sea traded this week for a record $148.
Little wonder that real-world oil is so costly when Kpler&rsquo;s data reveals that exports from the OPEC+ nations have collapsed.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/65DEVid3Mky1ZLssq8wzoP/d777f36541742fa658b3cbb15eddc320/FMF-Issue-041626_3_.png" alt="pub" width="540px" />
Meanwhile, West Texas Intermediate futures are up 2.5% as we write to $93.60. How long can the disconnect last?
Well, as we mentioned two days ago, a huge confluence of events is about to hit next Monday and Tuesday&hellip;
<ul>
<li>The last oil tankers that departed the Strait of Hormuz before the war began will reach their destinations in Malaysia and Australia</li>
</ul>
<ul>
<li>May oil futures traded in New York expire on Tuesday</li>
</ul>
<ul>
<li>The aircraft carrier USS George H.W. Bush is set to arrive in the region &mdash; just as the two-week ceasefire is scheduled to expire Tuesday.</li>
</ul>
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> In the meantime, the S&amp;P 500 and the Nasdaq are reaching even higher into record territory.
Both indexes set record closes yesterday. Both are up about a quarter percent at last check today &mdash; the S&amp;P at 7,040 and the Nasdaq over 24,000. But at 48,547 the Dow still has work to do to regain the 50,000 mark that ex-Attorney General Pam Bondi was crowing about.
Precious metals look quiet &mdash; gold just over $4,800 and silver a few pennies below $79. Crypto is consolidating, Bitcoin just over $74,000 and Ethereum over $2,300.
The big economic number of the day is industrial production &mdash; down 0.5% in March, in contrast with the typical Wall Street economist&rsquo;s expectation for a 0.1% bump higher.
Some of that can be chalked up to milder weather &mdash; energy/mining production and utility production both fell. But manufacturing also contracted.
All told, 75.7% of the nation&rsquo;s industrial capacity was in use during March &mdash; the weakest in four months.
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-4-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-4_2x-new.png 2x" alt="4" width="37" />Comic Relief
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> The vibe in the meme-o-sphere is shifting rapidly from unaffordable housing to&hellip; the end times.
<img class="aligncenter" src="https://images.ctfassets.net/vha3zb1lo47k/1MHfbotC5NcDN006ZVOzaR/db8f51e0c00141ae18daff9f7406b768/FMF-Issue-041626_4_.png" alt="pub" width="540px" />
<img src="https://media.paradigmpressgroup.com/fmf-assets/bullet-5-new.png" srcset="https://media.paradigmpressgroup.com/fmf-assets/bullet-5_2x-new.png 2x" alt="5" width="37" />After Yesterday&rsquo;s Mailbag&hellip;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;Great retort, couldn&rsquo;t agree more with you,&rdquo; a reader writes after your editor took more slings and arrows in the mailbag during <a href="https://paradigmpressroom.com/post/just-because-the-war-escalates">yesterday&rsquo;s edition</a>.
&ldquo;I feel our country has advanced enough from the Founding Fathers to do away with our political representatives &mdash; they serve not the constituents, but only their own interests. They are owned by special interests, big corporations, big pharmaceutical companies, etc.
&ldquo;Surely our society with today&rsquo;s technology and instant communications can come up with a solution without the control of the deep state. At the very least, we shouldn&rsquo;t allow attorneys to become politicians &mdash; it&rsquo;s like putting the wolves in charge of guarding the henhouse.
&ldquo;Love your services.&rdquo;
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;Hey Dave, time to counteract some of the other feedback you've been getting,&rdquo; writes another.
&ldquo;I love it when you agree with my outlook, but I love it even more when you point out something I didn't know, even if I disagree with it.
&ldquo;So please keep running your mouth.
&ldquo;(Except perhaps stay quiet regarding your immediate environs.)&rdquo;
Dave responds: Thanks to the readers rising to my defense after the recent incoming fire &mdash; which has not ceased.
&ldquo;Gonigam, why do you believe you have the answers for all?&rdquo; says one. &ldquo;Don't you have any common sense, that any bashing of a sitting president at time of war is helpful to the enemy?&rdquo;
I have a feeling this individual had no issues bashing Bill Clinton during his promiscuous warmaking in the &rsquo;90s, or bashing Barack Obama while he bombed even more countries than Dubya Bush did.
And no, I don&rsquo;t have all the answers. I have no idea at all how to order the affairs of other people&rsquo;s countries &mdash; which is why regime change and similar efforts are such an awful idea.
Yesterday during a congressional hearing, White House budget director Russell Vought told Congress he was unable to come up with a cost estimate for the Iran war. Vought was reminded the Pentagon <a href="https://paradigmpressroom.com/post/elon-vs-the-pentagon">has never passed an audit</a>.
&ldquo;There is so much arrogance in that agency,&rdquo; said Rep. Glenn Grothman (R-Wisconsin). &ldquo;They just say &zwnj;we don&rsquo;t have to do it on audit. We&rsquo;re so damn important. We don&rsquo;t care what Congress thinks.&rdquo;
We await the economic consequences&hellip; and we&rsquo;ll anticipate and chronicle them here, ahead of the mainstream.
<img class="intrinsic" style="float: left; display: block;" src="https://media.paradigmpressgroup.com/fmf-assets/Paradigm_Logomark_left.png" align="left" /> &ldquo;Do you have a citation for the George H. Smith observation on Hamilton?&rdquo; a reader inquires after yesterday&rsquo;s mailbag.
&ldquo;Thanks for all your work,&rdquo; he adds, &ldquo;and to heck with the don&rsquo;t-talk-about-politics people. Everything unfortunately flows through that sewer and we have to navigate it like a Ferengi on the Great Material River (OK, really obscure reference but it fits).&rdquo;
Dave: Sadly, nothing in print. I recall Smith&rsquo;s quip from an excellent lecture series he did titled An Overview Of American History: From the Revolution to the Progressive Era. It was distributed on audiocassette by the gone-but-not-forgotten Laissez Faire Books.
Unlike a lot of spoken-word content from the &rsquo;80s and 90s, it doesn&rsquo;t appear to be on YouTube. I do have mp3s in my possession that I copied from the cassettes long ago. I might be the only one!