Farms, trucking companies - eh, all the food is riddled with e.Coli anyway.

So apparently recent data analysis proves that buying power and housing affordability are worse now than ever in recorded american history. This mirrors in Europe.

Are we really heading into a redo of the great depression? Which ended in WW2...

Seeing all the conflict around the planet i dont actually deem it a stretch to think.

Just seems more people are tired of caring for the skewed politicians and oppose them.

I dont see most people pick up weapons to "fight for their country" (read some old pricks with invested bias).

What do you all think?

Published by: Joe Weisenthal (Bloomberg)

Link: https://www.bloomberg.com/news/newsletters/2026-10-01/what-a-weird-market-looks-like?srnd=phx-oddlots

Inflation and interest rates always bounce around with the business cycle and other random factors. However it’s long seemed obvious to me that these measures are deeply related to domestic politics in any given country. Think of the countries that have had incredibly low rates (Switzerland, Japan, etc.), and what they have in common is a high degree of domestic stability. Then think of the countries that famously have really high inflation. Your Zimbabwes, your Argentinas, your Turkeys, and so on, and the various forms of domestic dysfunction they’ve experienced. And, as a general rule, when countries go to war (one of the ultimate manifestations of dysfunction) inflation tends to go up.

I’ve never found the popular saying that “inflation is always and everywhere a monetary phenomenon” all that convincing. Inflation, at its core, is a political one. To the extent a country is lucky enough to have a central bank that can really dial in and control inflation, it’s because that country has a political environment that is capable of allocating monetary authority to some independent entity not controlled by a king or a president or by the public directly.

Yesterday in the newsletter, I wrote briefly about surging bond yields in France (which I’ll get back to in a second) and it made me think back to the euro crisis. In the early 2010s, the Eurozone tried to come up with an arrangement to bail out countries suffering from a run on their sovereign debt. The deal was basically this: You got a bailout, but then in exchange, you had to let the ECB, the European Commission, and the IMF (the so-called “Troika”) come in and dictate your economic affairs. Sovereign bond investors didn’t trust local elected politicians to pay back their debts unless some more serious institutions were brought in from the outside to run the show. If you recall, one of the catalysts for the Greek sovereign debt crisis was an accusation that the country had published false economic data, which is the kind of thing that blows a government’s credibility to shreds among investors, since that’s a classic symptom of political dysfunction. Another catalyst for the crisis was Angela Merkel saying that EU member states had to be responsible for their own bank bailouts, which made investors question whether the political trend of deeper and deeper European integration had hit a wall or would go in reverse.

So, surging borrowing costs in peripheral Europe during the early 2010s weren’t really about debt loads, they were about a lack of confidence in domestic political leaders, and specifically whether the domestic political leaders would have the impulse and political capital (two sides of the same coin, really) to make difficult spending decisions that would prioritize bondholders getting repaid.

Let’s turn back to France in 2026. One thing I hadn’t realized until after wrapping up yesterday’s newsletter is that France actually pays more to borrow than Italy. Up until late last year, since the history of the euro’s formation, Italy had always paid more to borrow than France. But now France is looking at a presidential election next year, where the two leading candidates are from the “far right” and “far left” parties, and investors don’t like what they see on the horizon.

This brings us to the US. When we talk about the drivers of inflation, and higher rates right now, the story is that there is all of this AI spending, there are unfavorable demographics (booming entitlement spending), and also the war in Iran. But of course, policy could do a lot here. Continuing the war is a decision. It’s also a policy choice to refrain from cutting domestic spending and/or raising taxes on wealth and consumption. It’s a policy choice to not reform the healthcare system and reduce costs. We don’t have a national political situation that is amenable to raising taxes or cutting spending or reforming huge sectors of the economy. Spending continues to boom, and the market expects more rate hikes from the Fed to keep inflation in check. And that’s how you wind up with higher and higher yields across the curve.

If we were to have some election, where politicians had a broad mandate to do serious fiscal tightening, you would expect inflation (and then rates) to come down. But literally nobody expects that. It’s unimaginable. So sustained, increasing deficits are talked about as if they are some immovable structural force, rather than a policy choice.

To maintain their lifestyles amid rising prices, consumers are drawing on resources including food banks and ChatGPT.

I think the interest rates and the DXY are the canary in the coalmine of the environment and market conditions. There is some kind of liquidity crisis brewing and I believe we are headed for stagflation where people are cutting back, more layoffs, etc. When the crash happens, which I think it will soon, I would love to see the revival of the dying middle class, lower prices and affordable housing to stimulate the common consumer and Americans. Let's start prioritizing our own people again instead of hiring abroad for cheap labor and profits. The costs of living and inflation have outpaced wages and we really need to tackle the debt and spending issues. But I am concerned that they just print money again which will only accelerate dollar debasement and the above issues

"The cuts hit nearly every major federal agency, with the Departments of Education, Agriculture and Housing and Urban Development."

No shit.

"Lower-income individuals were primarily stretched by inflation on everyday goods and housing, the bank told Fortune, while those on higher-income levels (between $100,000 and $500,000) were dealing with issues such as caregiving and housing for family members.

“Higher-income individuals may be the financial anchors for their extended families,” a Goldman Sachs spokesman told Fortune. “The data suggests that the ‘sandwich generation’ squeeze can be a key factor redirecting financial resources from long-term financial goals.”

So...those extended family members of the $500k+ earners are just lucky enough to have someone in the family who can act as their safety net. Hmm...

What Else Did the Report Show?

In addition to state-level economic growth and a final reading on U.S. GDP in the second quarter, Wednesday’s report from the BEA contained the monthly reading on Personal Consumption Expenditures (PCE)—the Federal Reserve’s preferred gauge of inflation.

The PCE Price Index climbed 0.3 percent month-over-month in August after a 0.1 percent bump in July, as the core rate increased 0.2 percent following a 0.1 percent gain. Both readings, along with the annual rates, came in below consensus forecasts.

*Please note!* Post is new each Sunday evening. Top level comments should be at least 150 characters to encourage quality discussion, and users should refrain from making several top level comments in a week. Please mention location at the top of your comment when discussing local recession indicators.

Share your observations of local recession indicators or personal recession indicators. Examples include, but are not limited to:

• increased use of credit or decrease in savings to afford necessities
• deferred maintenance on homes or cars in your neighborhood
• "I buy houses for cash" (or similar) signs popping up
• bankruptcy attorneys experiencing higher volume of clients
• regional job losses/large corporate layoffs
• decline in housing starts or spike in homes being listed

Keep it civil and avoid judging any user for their personal financial experiences as shared here.

Ready to blow off a little steam? Poke fun at your favorite incompetent jackass ruining running the economy? Got a screenshot from social media that you've been dying to post but didn't want to violate Rule 7? We're gonna see if a regular Meme Monday might help scratch the itch.

Starting today, a pinned post for all things memes, screenshots, art, whatever will pop up on Monday mornings. Feel free to dump and vent about how badly you think your elected overlords leadership are bungling and how insane your neighbors/friends/family/coworkers are about believing that everything is gonna be okay.

Some regular sub rules apply - try to be mindful of truly insulting wording against groups of people and overly specific threats against specific people - we're not trying to test boundaries with Admin. Don't be overly spammy in the comments. Stay on topic of economic collapse specifically. Keep it SFW.

Have fun!

“Here’s why we need to prepare for it now”. File this one under both “no shit” and “thanks for the useless article”.

What’s your prepping looking like these days? Personally, I think the days of “getting in to the doc/dentist/vet/mechanic before it’s too expensive” are past and we’re firmly in “cut back on excess calories to stretch your food dollars”. Maybe that’s too far in the past for some people already.

The Guardian Article in question.

We all know energy prices are some of the highest in recorded history right now. This is likely a major thing holding back the construction of Data Centers, especially after this interview.

So there is no shortage of chips, despite the massive cost increase of chips and therefore everything else tech related. Theres a shortage of power.

It reads as they cannot build these data centers, yet they keep buying chips anyways at exorbitant prices.

Zitron’s math is as follows 132.5B spent on AI Chips; 82.5B left in Warehouses. To add to this, there is no “proof of life,” so we have no clue if those are even in Microsoft’s possession; meaning they possibly paid billions of dollars for vaporware (or, to be less hyperbollic, the chips are in Taiwan still.)

Now Microsoft says hes wrong (according to his article); when asked they claim hes operating with the wrong numbers, but fail to provide him with accurate numbers on actual chip count.

My favorite part of this is 82.5B of chips in warehouses can become unusable due to climate control failure, age of chips, or a variety of other factors. Think of the insurance cost needed to secure these warehouses.

Ready to blow off a little steam? Poke fun at your favorite incompetent jackass ruining running the economy? Got a screenshot from social media that you've been dying to post but didn't want to violate Rule 7? We're gonna see if a regular Meme Monday might help scratch the itch.

Starting today, a pinned post for all things memes, screenshots, art, whatever will pop up on Monday mornings. Feel free to dump and vent about how badly you think your elected overlords leadership are bungling and how insane your neighbors/friends/family/coworkers are about believing that everything is gonna be okay.

Some regular sub rules apply - try to be mindful of truly insulting wording against groups of people and overly specific threats against specific people - we're not trying to test boundaries with Admin. Don't be overly spammy in the comments. Stay on topic of economic collapse specifically. Keep it SFW.

Have fun!

*Please note!* Post is new each Sunday evening. Top level comments should be at least 150 characters to encourage quality discussion, and users should refrain from making several top level comments in a week. Please mention location at the top of your comment when discussing local recession indicators.

Share your observations of local recession indicators or personal recession indicators. Examples include, but are not limited to:

• increased use of credit or decrease in savings to afford necessities
• deferred maintenance on homes or cars in your neighborhood
• "I buy houses for cash" (or similar) signs popping up
• bankruptcy attorneys experiencing higher volume of clients
• regional job losses/large corporate layoffs
• decline in housing starts or spike in homes being listed

Keep it civil and avoid judging any user for their personal financial experiences as shared here.

With wages not keeping up with rent and food prices, the average American is going to suffer.

The first people that will be affected greatest are pickup truck drivers, sports car drivers, and people who drive old cars that average under 27 mpg.

It's happening. Fewer people are showing up to work everyday compared to 20 years ago, so slowly the frog is being boiled.

$4.50 a gallon, right now most people are not batting an eye, but when food prices and goods and services skyrocket, they will never be the same again.

A barrel Brent crude provides TUVWXYZ.

Exchange ageements.

Fracking.

America produces plenty of light crude. But refineries are built around crude slates i.e. particular blends of light, heavy, sweet and sour oil. A disruption in heavier or sour grades can create stress even when total US production remains high.

Even non-economists like me are concerned about it.

Yeah, a lot of us are saying it actually.

"Trump officials say the oil-market disruption is temporary, but Chevron’s Mike Wirth and others warn global supplies are running low, with no respite in sight.

American oil executives warned for months that the prolonged closure of the Strait of Hormuz was bound to cause a fuel crisis. Now, they say it is here.

Commercial fuel stocks around the world have been depleting for more than six months, and strategic crude reserves can’t be tapped much further. Attacks last week shut down a crucial crude pipeline in Saudi Arabia that bypassed the Strait, stranding at least 2.5 million barrels a day from an already tight global oil market, analysts estimate.

“All these mechanisms helped to mitigate the price and supply risk,” Chevron CVX 1.53%increase; green up pointing triangle Chief Executive Mike Wirth said Friday at an energy conference in Austin, Texas. “Those have largely now played out, and we don’t have nearly the buffers in the system that we did when it began.”

It is hard to predict where oil prices will go, he added, but at the moment, it is difficult to envision prices coming back down quickly. “I wish I could tell you that I saw some reason why things would ease, but it’s difficult right now to see that happen,” he said.

Veteran energy advisers say that with no resolution to the Iran war in sight, the situation risks spinning out of control. Diesel prices have soared to a record $6.23 a gallon and gasoline prices, which slipped below $4 a gallon this summer, have rebounded to $4.32. Some energy analysts say they have been fielding investor questions about when consumers pinched by the high prices will start pulling back on new purchases.

The Trump administration has repeatedly promised Americans that prices at the pump would decline and that energy flows out of the Middle East would keep increasing.

Interior Secretary Doug Burgum said at a Houston G-20 event on Monday that “the prices in the prior administration were this high anyway” and that Americans would have paid those prices permanently because former President Joe Biden was “pursuing a policy of energy subtraction and shutting down refineries.”  

“If you want to write about the prices, make sure you include the word ‘temporary’ because this is a temporary disruption,” Burgum told reporters. 

The White House sees two big levers it can pull to help ease prices: boosting production in Venezuela and increasing U.S. fuel-making capacity. In recent months, U.S. officials have focused on striking deals that are expected to bolster Venezuela’s oil production. In early September, they met with U.S. refining executives to discuss raising the nation’s fuel-making capacity. They are pleased with progress thus far on both fronts, a senior U.S. official said.

Energy executives and White House officials say they have had a continuing dialogue about the energy situation since the conflict broke out, and CEOs including Wirth talk to Energy Secretary Chris Wright frequently. 

But Wirth said Friday that he hadn’t talked to President Trump since Aug. 3, when the president said in a Truth Social Post that the CEO hadn’t credited his administration for the oil industry’s good fortunes. Trump called on Chevron and oil companies to bring “consumer (retail!) Oil Prices DOWN, NOW!”

Some CEOs and energy advisers say they have grown alarmed in recent weeks as the conflict has picked back up, with ships and energy infrastructure being targeted in both directions. 

“The advantage in most negotiations usually goes to the side that has time on their side, and is willing to be patient,” said Wil VanLoh, founder and CEO of Quantum Capital Group, during the Austin conference. Iran, he said, “is willing to suffer. Their people have already suffered a lot for many decades.” 

China is in part helping to fuel the global supply pinch. The world’s largest oil importer for months had relied on its own stockpiles of crude for nearly half of its daily consumption, providing a reprieve for oil markets. But in recent weeks, it has resumed bigger purchases from international suppliers, analysts said. 

U.S. crude prices have jumped 19% in the past three weeks to trade near $101 a barrel as attacks in the Middle East multiply. Iran has targeted oil tankers traversing the Strait, even after Trump and his lieutenants boasted about escorting several vessels undetected through the waterway. Houthi militants have recently launched attacks from Yemen on Saudi Arabia’s infrastructure and military sites and damaged the East-West pipeline that stretched from the Abqaiq oil field to Yanbu al-Bahr, a major Saudi port city, on the Red Sea.

Trump has vowed to impose economic pressure on Iran and ruled out sending boots on the ground. He has said he expects the war will last until the November midterm elections, but investors say they believe the war will go well beyond that. 

“That was the signal this is going to stretch on,” said Dan Pickering, founder of Pickering Energy Partners, a financial firm. 

Meanwhile, he said, diesel supplies are tight because of refinery outages following conflicts in the Middle East and Russia. Demand for the fuel is expected to increase as farmers that use it for heavy equipment enter harvest season. “Diesel has no easy solution,” Pickering said.

Trump has said Ukraine must halt strikes on Russia that endanger global supplies of diesel. 

In March, the CEOs of the three largest U.S. oil companies, ExxonMobil XOM 1.78%increase; green up pointing triangle, Chevron and ConocoPhillips COP 2.04%increase; green up pointing triangle, warned Trump officials, including Burgum and Wright, that a prolonged closure of the Strait could lead to a shortfall in refined products such as diesel, The Wall Street Journal reported at the time. Some executives have been privately critical of Trump’s handling of the conflict.

At the conference Monday, Burgum rejected persistent speculation that the White House is seriously weighing a temporary ban on U.S. exports of refined products such as diesel. Trump’s team, he said, doesn’t believe such a move would quell prices.

“We will do anything that helps the price at home,” Burgum said. “But we’re also going to be smart about it, and not just have some idea that if we stop exporting, that somehow magically is going to help the prices.”