The U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) issued a warning on Thursday that Chinese money laundering networks (CMLNs) pose a substantial threat to the U.S. financial system, citing money laundering by Mexican drug cartels, including some that have been designated as Foreign Terrorist Organizations (FTOs).

FinCEN stated that it reviewed more than 137,000 Bank Secrecy Act reports from 2020 to 2024, identifying around $312 billion in suspicious transactions tied to CMLNs.

“Money laundering networks linked to individual passport holders from the People’s Republic of China enable cartels to poison Americans with fentanyl, conduct human trafficking, and wreak havoc among communities across our great nation,” stated Under Secretary for Terrorism and Financial Intelligence John K. Hurley. He said FinCEN’s Advisory and Financial Trend Analysis reinforces Treasury’s and law enforcement’s ongoing work to dismantle command and control nodes within critical Chinese money laundering networks. 

In an interview, investigative journalist Sam Cooper of The Bureau told ZeroHedge that while the $300 billion money laundering figure is massive, his reporting suggests the actual scale is far higher.

Expert Analysis: U.S. Treasury Warns of $312 Billion in Chinese Laundering For Mexican cartels https://t.co/hf6FLQ42mL

— Sam Cooper (@scoopercooper) August 29, 2025

By factoring in the trade-based money laundering methods described by FinCEN, in which Chinese underground banks collect drug cash from foreign organized crime groups operating in the United States and Canada, then weave it into China’s manufacturing and export economy and throughout Latin America, the amounts should be over a trillion dollars.

He added that Wall Street executives should be studying FinCEN’s warnings and ensuring their compliance and reporting systems are airtight, because a senior U.S. official suggested this year, that, going forward, institutions such as TD Bank, if found to have knowingly tolerated lax reporting on Chinese-linked transactions, could face scrutiny for enabling terror-designated cartels to wash fentanyl proceeds.

Cooper’s report below provides new insight into Chinese networks moving tens of billions for Mexican cartels, also pushing illicit cash through U.S. real estate, elder care centers, and human trafficking schemes. 

 *   *   * 

Submitted by The Bureau’s Sam Cooper, 

The U.S. Department of the Treasury issued a stark warning Thursday that Chinese money laundering networks have become a primary engine driving Mexico-based drug cartels’ expansion into the United States, flagging $312 billion in cartel-linked suspicious transactions and a further $53.7 billion in illicit real estate activity over the past four years. Officials underscored the systemic risks posed by what they described as a sprawling global underground economy.

While cartel laundering was the central focus, Treasury’s Financial Crimes Enforcement Network (FinCEN) also highlighted troubling evidence of Chinese-linked financial activity tied to elder care centers, human trafficking, and fraud. Investigators flagged $766 million in suspicious activity at 83 adult and senior day care centers in New York, along with 1,675 reports of suspected human trafficking or smuggling, and 108 reports tied to elder abuse and health care schemes.

New York has been the focus of investigations showing how Chinese community groups and service centers became entangled in Beijing’s foreign interference campaigns, according to indictments and reporting in The New York Times—raising concerns that the financial networks flagged by FinCEN blur the line between criminal enterprises and hostile state activities.

As reported previously by The Bureau in coverage of a sweeping FinTRAC warning on Chinese underground banking in Toronto, FinCEN is now raising similar alarms. The Treasury said so-called “money mules” often rely on falsified jobs and identities to gain access to the banking system, disguise unexplained wealth, and buy residential properties. In cases where these mules opened accounts, they frequently listed occupations such as “student,” “housewife,” “retired,” or “laborer” — roles that would not normally involve large volumes of financial activity — yet the accounts showed high-value deposits and transactions consistent with laundering.

These same evasive patterns first appeared in audits during the 2010s of massive drug-money laundering through British Columbia’s government casinos, a dominant node of Chinese triad and state activity in North America. According to FinTRAC, Chinese criminal networks shifted the scheme across Canada’s banking and legal systems during the pandemic, when casino closures forced an evolution of laundering tactics.

In the United States, Treasury officials said, these networks have become critical partners to Latin American drug cartels — including groups designated as foreign terrorist organizations.

“Money laundering networks linked to individual passport holders from the People’s Republic of China enable cartels to poison Americans with fentanyl, conduct human trafficking, and wreak havoc among communities across our great nation,” said John K. Hurley, Treasury’s Under Secretary for Terrorism and Financial Intelligence. “The United States will not stand by and allow nefarious actors to launder illicit proceeds through our financial system.”

FinCEN Director Andrea Gacki called the networks “global and pervasive,” warning that they must be “dismantled” through coordinated international action.

The Financial Trend Analysis behind the advisory drew on 137,153 Bank Secrecy Act reports filed between January 2020 and December 2024, documenting $312 billion in suspicious transactions tied to Chinese laundering networks.

Officials described a vast shadow infrastructure stretching from cartel couriers in the United States and Mexico to Chinese nationals seeking to evade Beijing’s strict capital controls. The result is a mutually beneficial pipeline: cartels desperate to shed bulk U.S. dollars sell cash to Chinese intermediaries, who in turn profit by reselling those dollars to wealthy clients inside China eager to move money abroad.

Chinese Command Cartel Money Movement

A granular view of the scheme emerged in the stunning case of Beijing-born Zhi Dong Zhang — code-named “Chino” — who, as The Bureau reported this week, recently escaped house arrest in Mexico City just days before his scheduled extradition to the United States. Indictments allege Zhang commanded both the Chinese and Mexican wings of cartel operations, training Hispanic money mules to infiltrate U.S. banks. He reportedly bridged fentanyl precursor supply lines for the rival Sinaloa and Jalisco cartels — a rare position that underscored how Chinese networks have become the anchor of cartel financial and chemical infrastructure.

The global, trade-based nature of the system — emphasized in Treasury officials’ comments — stems from Mexico’s restrictions on dollar deposits and China’s caps on outbound transfers. Together, these measures have forged what Treasury calls a “mutualistic relationship” between cartels and Chinese brokers. Cartel proceeds in U.S. dollars are sold at a discount to Chinese laundering networks, which in turn meet demand from Chinese citizens and businesses seeking dollars for tuition, real estate, or investments in the United States.

Transactions move through informal networks advertised on WeChat or brokered via personal connections. Cartels are then compensated in yuan through Chinese accounts or with goods purchased in Asia and shipped to Mexico through their diaspora distribution channels.

In some cases, financial institution employees are recruited as complicit insiders, while counterfeit Chinese passports have been used to open accounts and disguise flows. The layering of shell companies, third-party intermediaries, and complex real estate purchases allows illicit proceeds to be reintegrated into the legitimate economy.

As previously reported by The Bureau, the U.S. government has been surfacing vast datasets and cases tied to an ongoing DEA task force codenamed Sleeping Giant. The operation was launched by senior DEA agent Don Im, whose career has focused on decoding China’s central role in global money laundering and chemical supply chains for methamphetamine and fentanyl. The mission was designed to bring cases against Latin American cartels working in partnership with Chinese laundering syndicates.

One of the task force’s major cases revealed how Sai Zhang, a Chinese student in California on a study visa, played a commanding role in orchestrating Sinaloa cartel fentanyl cash flows. But the system extended far beyond one trafficker, Im said, bridging into the architecture of China’s economic system itself.

“Chinese banking networks were operating in the U.S. long before Zhang linked up with the Sinaloa cartel,” Im told The Bureau in a report that previewed FinCEN’s detailed findings. He described how Chinese buyers bid on pools of cartel drug cash collected worldwide, paying a premium to receive laundered dollars in U.S. cities and investments of their choosing. “The buyers were mostly wealthy Chinese seeking dollars for real estate or tuition in America. Payments were made in yuan through Chinese accounts. In return, Mexican cartels received goods or cash.”

In exclusive interviews, Im outlined in unprecedented detail the breathtaking complexity of China’s global drug money laundering networks — a labyrinth of shadow transactions that Sleeping Giant helped map and penetrate. These findings, he said, help explain why Washington is now imposing new trade sanctions targeting China and countries bound tightly to its export-driven economy.

At the heart of the problem, according to Im, is Beijing’s decentralized economic apparatus. The Chinese Communist Party’s regional governors knowingly align with drug barons, he argued — channeling fentanyl cash, reintegrating it into China’s industrial output, and exporting drug-funded goods worldwide. Meanwhile, Chinese immigrants and travelers access the other side of this narco-banking system, using it to bankroll overseas investments and strengthen the reach of the Chinese diaspora.

The new Treasury advisory urges financial institutions to sharpen detection of red flags, from unusual cash deposits and wire transfers tied to Chinese nationals to trade transactions routed through shell companies and real estate purchases inconsistent with reported income. Officials cast the move as part of a whole-of-government campaign to choke off cartel financing while pressing for tighter coordination with foreign governments and law enforcement partners.

“Chinese money laundering networks are global and pervasive, and they must be dismantled,” Gacki said.

One senior U.S. expert, in a previous interview, warned that diligent business leaders in the United States — and worldwide — would be wise to study such sweeping warnings, or risk penalties for complicity in terror-designated cartel financing if they fail to implement proper controls and oversight of suspicious transactions.

On the same day that President Trump flipped the switch on ‘de minimis’ exemptions, a US Appeals court has ruled that most of his global tariffs are illegal, finding that he exceeded his authority in imposing them.

In May 2025, a lower court deemed them unlawful for exceeding presidential authority under a 1977 law, but the appeals court paused that ruling.

And now, a panel of judges in Washington on Friday upheld an earlier ruling by the Court of International Trade that Trump wrongfully invoked an emergency law to issue the tariffs.

But the appellate judges sent the case back to the lower court to determine if it applied to everyone affected by tariffs or just the parties involved in the case.

However, this is not the end by a long way as the court also ruled that Trump’s tariffs can remain in effect pending appeals.

Friday’s ruling extends the suspense over whether Trump’s tariffs will ultimately stand.

The case had been expected to next go to the Supreme Court for a final decision.

Developing…

Authored by ‘sundance’ via The Last Refuge,

If there is one key takeaway from what you are about to read, it would be this. DNI Tulsi Gabbard needs our support. DNI Gabbard is working deep within a massive silo system that manufacturers the illusion of isolation as a strategy to protect itself.

“There is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in the introduction of a new order of things.” Tulsi Gabbard and her team need to hear, see and feel our support.

Yesterday, the CIA Directorate of Analysis purposefully framed a hit against the Office of the Director of National Intelligence (ODNI) by leaking a manufactured story that DNI Tulsi Gabbard had exposed an “undercover” agent when she removed the security clearances of 37 former and current intelligence embeds.

In reality, the CIA attempted to block Tulsi Gabbard from exposing how the CIA manipulated the 2017 Intelligence Community Assessment claiming Russian interference in the 2016 election. Ms. Julia Gurganus was the CIA analyst who organized the ICA.

As Tulsi Gabbard began to drill down onto the issue, and as the current CIA analysts within the former National Intelligence Council (NIC) and CIA Directorate of Analysis began to notice she was going to reveal the fraud, the CIA embeds changed the status of Julia Gurganus in June in an effort to protect her.

The CIA changed the status of Julia Gurganus in June, reclassifying her as ‘covert’ specifically because the ODNI’s public statements of intent to reveal the fraud within the 2016 Russia election investigation.

 This, they schemed, would stop DNI Gabbard from exposing Gurganus and taking action.

The CIA scheme didn’t work. 

DNI Gabbard declassified and released the CIA work product, and then later removed Gurganus security clearance.  The CIA embeds at the directorate of analysis were furious and leaked the false story to the Wall Street Journal using the familiar ploy that has worked for them in the past.

By calling Julia Gurganus an active and covert CIA operative, the scheme team within the directorate knew Gabbard would be unable to defend herself publicly. 

Discussing the identity of an active/covert CIA operative is against the law.  The CIA weaponized the law within their attack against the ODNI; leaking a false story they knew Tulsi couldn’t defend against.

However, we the people are not stupid.  It did not take long to figure out the identity of the asset from the curriculum vitae used in the Wall Street Journal story, and from that point it was clear Julia Gurganus was NOT previously a covert CIA operative.  Gurganus was public in her position within the CIA; public, until the CIA changed her status in June.

This is ultimately an example of the weaponized intelligence system DNI Gabbard is fighting against.

The current actions by the directorate of analysis inside the CIA is also an example of why DNI Gabbard removed the National Intelligence Council from the agency, fired Chairman Mike Collins (friend of Mike Morrell) and Deputy Chair Maria Langan-Riekhof, and also took control over the Presidential Daily Briefing material the fraudsters were in control of.

Remember, by design the CIA is a one-way information system.  Information (intelligence) goes into the agency, the black hole where things can be linguistically modified and shaped to fit a particular viewpoint, yet there is no substantive mechanism for the CIA head to challenge the outflow of information if it is fraudulent.

The intel bureaucrats run the machinery, and if the boss does something they don’t like they leak to the media.

Silos exist, like the NIC or directorate of analysis, within the larger silo of the CIA.  DNI Tulsi Gabbard is taking the lid off these sub-silos and exposing the activity that takes place within them.  Cochroaches cower and run from sunlight.

The awesome thing about what they tried yesterday was a factual reveal to the American public that CIA operations are also domestic in nature.  Most people believe the Schoolhouse Rock construct of government where the CIA is not allowed to operate domestically.  The story surrounding Julia Gurganus active and covert status completely eviscerates that perspective.

If covert CIA operatives are not permitted to engage in domestic governance, then why was covert CIA agent Julia Gurganus operating in government?  The shield the CIA attempted to deploy becomes a weapon for us to expose their fraud.

As this battle continues, and make no mistake this battle will continue, we will closely support the efforts of DNI Tulsi Gabbard to bring the weaponized IC to heel. 

.@DNIGabbard: “We are the greatest nation in the world because of our people — rooted in the principles of freedom and liberty that are enshrined in our Constitution. And it’s both our opportunity, our challenge, and our responsibility… to continue that mission for as long as… pic.twitter.com/550Ifq9tlp

— Office of the DNI (@ODNIgov) August 29, 2025

Gabbard is the truth warrior we need and the Deep State is not happy about it.

“We are the greatest nation in the world because of our people — rooted in the principles of freedom and liberty that are enshrined in our Constitution. And it’s both our opportunity, our challenge, and our responsibility… to continue that mission for as long as we live.”

Between persistent inflation, trade wars, and AI-related job disruptions, the outlook on the U.S. economy is once again ticking to “uncertain.”

If things get worse and unemployment starts to tick up, then more Americans might be forced to rely on state support to make ends meet.

But what’s the current picture? How many families in the country are already in need of benefits?

This map, via Visual Capitalist’s Pallavi Rao, shows the share of households in each state that reported receiving cash public assistance (also known as TANF, Temporary Assistance for Needy Families) or food assistance (also known as SNAP, Supplemental Nutrition Assistance Program) in 2023.

The data for this visualization comes from the U.S. Census Bureau’s. Figures are rounded.

Ranked: U.S. Households on Welfare by State

Puerto Rico stands out with 47% of households receiving assistance.

This reflects sustained economic challenges and unique territorial program structures.

Among the states, New Mexico has the highest share at 20%, followed by West Virginia (18%), Oregon (17%), Louisiana (17%), and New York (16%).

A large cluster of state jurisdictions have low‑to‑mid teens of U.S. households on welfare.

And at the other end, Utah and Wyoming are lowest at 6%, with New Hampshire and North Dakota at 7% and Kansas at 8%.

Regional Patterns and Notable Outliers

Appalachia and parts of the South post elevated welfare participation, mirroring higher poverty rates in the region.

However, even the richer Northeast has several higher‑than‑average states with households on benefits.

This includes Massachusetts, Pennsylvania, and Rhode Island (each 15%), alongside low New Hampshire (7%).

Meanwhile, on the West Coast, Oregon is an outlier at 17%, while California and Washington are closer to the national middle at 13%.

Overall, the median across the 50 states, D.C., and Puerto Rico is 13%, showing most places cluster in a narrow band.

Policy Design Matters for Welfare Access

Safety‑net participation reflects more than local poverty rates.

For example, SNAP is federally funded but state‑administered, and states differ in outreach, enrolment ease, and recertification cadence.

Cash assistance (often via TANF) is a capped block grant, and states set their own eligibility thresholds and work rules, which can meaningfully raise or lower participation.

States Will Have to Start Paying for Food Stamp Programs

Per reporting from Politico, Trump’s recent megabill has slashed federal funding for safety net programs and pushes food aid costs to the states.

Draft proposals would require states to cover between 5% and 25% of benefit costs starting in 2028 and pick up 75% of administrative expenses.

This marks a major change from today, where the federal government funds SNAP benefits entirely.

As a result states with higher participation and elevated error rates would face the greatest budget implications if these plans are implemented.

Authored by Paris Apodaca via The College Fix,

Smith College, one of just a few dozen women’s colleges in the U.S., is facing a federal civil rights complaint for allegedly discriminating against applicants based on their sex.

The private Massachusetts institution is a “women-only” college, but it “gives spots to ‘self-identifi[ed]’ transgender women that would have otherwise gone to biological women,” according to the complaint by Defending Education.

The education watchdog organization filed the complaint to the U.S. Department of Education’s Office of Civil Rights in June, alleging the college’s admissions practices discriminate against women in violation of Title IX. The civil rights law protects citizens against sex-based discrimination while also protecting single-sex spaces.

“We are confident that the U.S. Department of Education’s Office for Civil Rights will investigate the complaint against Smith College,” Erika Sanzi, director of outreach at Defending Education, told The College Fix in a recent interview.

The fact that Smith is a “women-only” college is not a problem; it’s the college’s admissions practices, according to Sanzi’s organization.

“The college’s Equal Education Opportunity Policy indicates that it will follow Title IX and prohibit discrimination on the basis of sex in its federally funded programs,” the complaint states.

“The very same policy, however, indicates that Smith interprets Title IX to prohibit ‘gender identity’ discrimination, despite federal case law and this Department’s guidance to the contrary,” it states.

Defending Education argues that Smith’s admissions policies discriminate against women not only by admitting male students in positions meant for females, but also by refusing admission to women who identify as men. 

“Ironically, in what appears to be yet another exercise in sex discrimination, Smith admits natal men who identify as women but does not admit natal women who identify as men,” the complaint states. 

The college’s admissions page website says, “Smith is a women’s college and considers for admission any applicants who self-identify as women; cis, trans, and nonbinary women are eligible to apply to Smith.” 

Additionally, the complaint mentions the college’s “all-gender restroom and locker room policies, which divest female students of their privacy, safety, and equal educational opportunity,” and “appear to violate Title IX.”

“Making matters worse,” the complaint also alleges the college’s Bias Response Team “threatens to investigate and/or punish students” who complain about these policies.  

The team is tasked with investigating incidents including “bigotry, harassment or intimidation” based on, among other things, an individual’s “gender identity” or “gender expression.” 

Smith College’s media relations office did not respond to three requests for comment from The Fix, asking about the complaint and its admissions practices. 

The Department of Education’s media relations office also did not respond to two emails from The Fix asking about the complaint.  

Smith College isn’t the only women’s college to prioritize “gender identity” over sex. According to a 2024 College Fix analysis, 27 of the 30 women’s colleges in the U.S. admit males who identify as females.

When asked about other colleges, Sanzi with Defending Education told The Fix, “If other colleges are engaging in similar discriminatory practices, we hope the Department will scrutinize their policies as well.”

Karin Lips, president of the Network of Enlightened Women, also weighed in on women’s colleges admission policies.

“Women should have the choice of attending a single sex institution. Some women excel in this environment,” Lips told The Fix last week when asked about the issue. 

The admissions problem is a broader issue, Lips pointed out, adding that all women should have the right to participate in single-sex clubs, sports, and school.

“Just as women should have the opportunity to participate in single sex clubs and sports, they should have single sex schools available to them,” she said.

Smith College adopted its admissions policy in 2015 following the case of a transgender applicant in 2013, according to Inside Higher Education.

Calliope Wong, a biological male who identifies as a woman, was denied admission because the sex on Wong’s financial aid form was listed as male. Afterward, Wong gathered 4,000 petition signatures, and the college responded by adopting the new policy, according to the report.

Under the previous policy, only females were admitted.

More recently, during its 147th commencement ceremony in May, the college awarded an honorary degree to Rachel Levine, former U.S. Assistant Secretary for Health under President Joe Biden. Levine is a man who identifies as a woman.

From Wall Street to Shanghai, stock markets form the backbone of modern economies. But where exactly is the bulk of the global stock market concentrated?

This Markets in a Minute graphic, via Visual Capitalist’s Jenna Ross in partnership with Terzo, breaks down the staggering $127 trillion global equity value.

The Global Stock Market: A Geographic View

Using data from SIFMA, let’s take a look at how global stock market value is distributed across key economies and regions. The data reflects listed domestic companies and excludes private equity. 

The U.S. stock market is by far the largest, making up nearly half of equity value. Its share of the global market went up 7% from 2023 to 2024, the biggest jump of any country or region. 

Historically, the U.S. share of the global stock market has fluctuated. In the early 1970s it climbed to around 70%, dipping in the 1980s partly due to the Japanese asset price bubble. After that, America’s proportion climbed again until the 2009 global financial crisis caused it to bottom out. Over the last 15 years, the U.S. equity share has grown from 30% to 49%.

Other Key Equity Markets

China is the second-largest stock market, though it is over five times smaller than the U.S. market. The country’s equity share is smaller than its proportion of the world economy in GDP terms. Foreign ownership restrictions and state-owned enterprises reduce the number of companies that are freely traded on public markets.

Following closely behind China, the EU has a collective share of nearly 9%. However, while China’s share remained stable, the EU saw a 2% decline in its global share from 2023 to 2024. The region faced political turmoil, low economic growth projections, and equity outflows.

Armed with this information on the stock market, investors can diversify and set geographic allocations in their portfolio. 

Authored by Lance Roberts via RealInvestmentAdvice.com,

What are energy prices telling us about the economy? A recent article on Bloomberg noted that:

“Hedge funds slashed their bullish position on crude to the lowest in about 17 years as risks of additional sanctions on Russian crude oil waned, bringing concerns about a global supply glut back to the fore. Money managers’ net-long position on West Texas Intermediate shrank by 19,578 lots to 29,686 lots in the week ended Tuesday, data from the Commodity Futures Trading Commission show. That’s the lowest since October 2008.”

However, there is more to this story than just easing global tensions and rising oil supplies impacting energy prices. Energy prices indicate economic strength, or, in this case, weakness. If the global economy grew strongly, the need for oil consumption would rise, absorbing the current production levels, causing energy prices to rise. However, the outlook for economic growth in the major oil consumption economies, the U.S. and the Eurozone, is very weak.

This is also why we are seeing the fastest pace of Central Bank rate cuts since the pandemic crisis in 2020, and the Federal Reserve in the U.S. is now joining in despite record-high stock markets.

However, I would be remiss in not stating that energy prices are susceptible to “geopolitical shocks.” This is because NYMEX traders bid up oil prices in anticipation of oil shortages, or conversely, excesses, but these price fluctuations tend to be shorter-term events.

Over the longer term, energy prices are an indicator of economic strength or weakness. This is because, as noted previously, energy is consumed in every part of the economic cycle.

“High oil prices add to the costs of doing business which pass, ultimately, on to customers and businesses. Whether it is higher cab fares, more expensive airline tickets, the cost of apples shipped from California, or new furniture shipped from China, high oil prices can result in higher prices for seemingly unrelated products and services.” – Investopedia

Of course, consumers who fill up their gas tanks each week immediately notice high oil prices. While core inflation reports strip out food and energy, those items drive short-term consumption patterns. Given that consumption comprises roughly 70% of the GDP calculation, the impact of higher oil prices is almost immediate.

As shown above, spikes in oil prices are highly correlated with economic recessions, financial events, and oil price reversions. Therefore, let’s explore energy prices as an economic indicator to see what oil is currently telling us about the state of the U.S. economy.

The Link To Oil

As noted, energy prices are crucial to the overall economic equation. As prices increase, consumers face higher inflationary costs. Unsurprisingly, there is a high correlation between the rise and fall of energy prices and the consumer price index. Unsurprisingly, energy prices and inflation have declined as economic demand weakened following the 2020-2021 stimulus-driven economic growth surge.

Since energy prices feed into virtually every aspect of our lives, from our food to the products and services we buy, we can expand our view of oil as an economic indicator. Therefore, the demand side of the equation is a tell-tale sign of economic strength or weakness. The chart below uses an economic composite of GDP, interest rates, and inflation compared to oil prices. It would be unsurprising that there is a decent correlation between the two.

Since the oil industry is manufacturing and production-intensive, falling energy prices impact other economically important facets of manufacturing, employment, and capital expenditures. The chart below shows oil prices and events relative to the deviation from the 4-year average energy price. While geopolitical events spike energy prices, as is 2022, those spikes result in economic downturns, reducing demand, thereby lowering energy prices.

While the pandemic-driven shutdown of the economy created a supply shortage, the flood of liquidity inevitably created a demand surge. That “pull-forward” of consumption led to surging inflationary pressures and rising oil prices. We show the high correlation between oil prices and breakeven inflation rates.

Oil prices reflect overall economic activity, given their vast contribution to everything consumed. With liquidity reversing, economic demand is weakening as the cost of living outpaces real wages. As such, the correlation between declining energy price, future economic growth, and inflation breakevens should be unsurprising.

The Fed Should Pay Closer Attention To The Energy Price

As noted above, global central banks have been cutting interest rates at the fastest pace since the pandemic, as many of those countries teeter on the edge of recession. However, the Federal Reserve remained steadfast until recently that its concern was a resurgence of inflation due to tariffs. But, as noted above, energy prices warned that inflation is not a concern for the U.S., and the Fed may be behind the curve in cutting rates.

Given that consumption makes up ~70% of the GDP calculation, and the importance of oil in everything we consume, it should be unsurprising that oil prices also reflect economic activity in the aggregate. The current decline in energy prices says a lot about underlying economic strength, which the Fed noted has shown up in the latest employment data.

“In the near term, risks to inflation are tilted to the upside, and risks to employment to the downside—a challenging situation. When our goals are in tension like this, our framework calls for us to balance both sides of our dual mandate.” – J. Powell

However, as noted above, energy prices clearly show that inflation risks are tilted to the downside, with the larger risk being a much weaker economic growth rate. As such, the Federal Reserve should likely cut rates more aggressively now to avoid the potential warning from the decline in oil prices.

If energy prices reflect economic activity, then their current trend points to growing weakness beneath the surface of headline data. While equity markets reach new highs and unemployment appears low, the sharp drop in oil prices and declining breakeven inflation expectations tell a different story. It’s not geopolitics or supply excesses driving prices lower. It’s waning demand. And that’s a red flag.

The Fed’s delayed response to this signal is concerning. As Powell notes, their framework must balance inflation and employment. But right now, inflation pressures are easing, not accelerating. Oil prices reflect that shift more clearly than any lagging indicator. If consumption is slowing, and energy prices strongly suggest it is, then the Fed should move faster, not slower. Waiting for confirmation in backward-looking data risks compounding economic weakness already in motion.

Historically, when oil prices fall significantly, the economy follows. The Fed would do well to pay attention.

After multiple launch attempts this week, most of which were due to adverse weather conditions and ground-based issues, Starship Flight 10’s launch was a wild success, with both the Super Heavy booster and the Starship Upper Stage successfully landing on their designated splashdown zones. 

Yet the far-left corporate media, controlled by liberal elites whose credibility sinks by the week, just couldn’t give credit where it was due.

So…

Hey CNN, there’s a typo in your headline. I fixed it for you.

“SpaceX Starship test launch shows future of low cost access to space, exploration of Mars” pic.twitter.com/RD7kLkjEC7

— Blake Scholl 🛫 (@bscholl) August 27, 2025

According to SpaceX, in a statement following Flight 10, “every major objective was met, providing critical data to inform designs of the next generation Starship and Super Heavy.”

To end the week, SpaceX published some absolutely wild footage of the Starship splashdown in the Indian Ocean. 

View of Starship landing burn and splashdown on Flight 10, made possible by SpaceX’s recovery team. Starship made it through reentry with intentionally missing tiles, completed maneuvers to intentionally stress its flaps, had visible damage to its aft skirt and flaps, and still… pic.twitter.com/QgcbPN8lY4

— SpaceX (@SpaceX) August 28, 2025

This looks fake, but it’s real

— Elon Musk (@elonmusk) August 29, 2025

Additional commentary on Starship’s splashdown…

Looking ahead, Musk wrote on X that test flights 13, 14, and 15 will most likely be when SpaceX uses its massive launch tower – outfitted with “chopstick” arms – to catch Starship, a system already employed to catch the Super Heavy booster.

Via Middle East Eye

Former US national security advisor Jake Sullivan was skewered as a hypocrite on Thursday after an interview aired of him saying he would support Congress voting to withhold military aid to Israel over its decision to abandon a Gaza ceasefire with Hamas in March.

“The situation as it stands today, following the breakdown of the ceasefire in March, means that a vote to withhold weapons from Israel is a totally credible position. That is a position I would support,” Sullivan told a podcast hosted by The Bulwark media. Sullivan was lambasted on social media for his statement.  

“This has almost been too obvious to say, but Jake Sullivan is one of the original architects and cheerleaders for Israel’s genocide and personally intervened to make sure the US is sending more bombs,” one commentator on X wrote.

Sullivan was Biden’s National Security Council advisor and deeply involved in efforts to arm Israel after it assaulted Gaza following the Hamas-led October 7, 2023 attacks on southern Israel.

During his time at the White House, Sullivan lobbied Democratic members of Congress against voting to block arms transfers throughout the war. Human rights experts and high-profile academics have labelled Israel’s war a genocide against Palestinians. Sullivan did not link a blockade of arms transfers to Israeli atrocities in Gaza.

“Jake Sullivan does not deserve an ounce of credit for saying this after he spent his time in power arming, enabling and defending the genocide in Gaza,” another commentator said on X.

“The continuing slaughter today was made possible by Jake and his boss, Biden. Is he hoping Americans don’t have object permanence?”

Sullivan’s record on calling shots in the Middle East has not aged well since he left office.

For months, he insisted that the former Hamas leader in Gaza, Yahya Sinwar, was the “massive obstacle” to a ceasefire. But Sinwar was killed in Gaza in October 2024, and the war has continued to rage without him. Almost a year after his death, Israel is preparing to assault Gaza City.

Sullivan is already remembered for his now infamous speech at the Atlantic Festival on September 29 2023, when he boasted that under the Biden administration, the Middle East “is quieter today than it has been in two decades”. 

A week later, the Hamas-led attacks on southern Israel sparked a region-wide conflict that included fighting in Syria, Yemen, and Lebanon. Israel and Iran engaged in unprecedented direct fighting, and the US, under the Trump administration, bombed Iran’s nuclear facilities.

Former US national security adviser Jake Sullivan talks about the future of the US-Israel relationship, and why a vote to withhold weapons from Israel is legitimate. pic.twitter.com/Cnnl6b30O0

— Al Jazeera English (@AJEnglish) August 28, 2025

Meanwhile, Israel’s genocide in Gaza has raged on with nearly unconditional US backing, first by the Biden administration and then the Trump administration. At least 62,966 Palestinians, mainly women and children, have been killed by Israel, according to Palestinian health officials.

Although Sullivan is no longer in public office, several commentators noted the irony of his calling for lawmakers to back an arms embargo on Israel while his wife, Maggie Goodlander, has remained relatively quiet on the topic. She is a Democratic congresswoman for the state of New Hampshire.

In a statement posted on her website on August 22, Goodlander called for humanitarian aid to surge into Gaza, but she did not call for an arms embargo against Israel or offer any new legislation on the matter.

At a moment peace negotiations look to be going nowhere, and as German Chancellor Friedrich Merz has declared it’s ‘obvious’ Putin and Zelensky aren’t going to meet, the Trump administration has authorized another $825 million arms deal for Ukraine.

Crucially, this package will include long-range missiles and supporting equipment, ostensibly to strengthen Ukraine’s defense capabilities, though the Kremlin is going to interpret this as another act of US escalation, given the long-range capability.

The US State Department announced on Thursday that it had formally notified Congress about the sale, denoting 3,350 extended-range attack munition (ERAM) missiles are part of it. Additionally an equal number of GPS navigation units and other parts are included. 

Funding for the purchase will come not only from US foreign military assistance but also from NATO partners Denmark, the Netherlands, and Norway, according to the announcement – which is according to Trump’s desire of getting Europe to shoulder more of the burden.

“This proposed sale will support the foreign policy and national security objectives of the United States by improving the security of a partner country that is a force for political stability and economic progress in Europe,” the State Dept. said.

Meanwhile Ukraine’s Zelensky has announced that a complete framework of “security guarantees” for Kiev in case of a ceasefire or peace deal is going to be ready as early as next week – but its contents will surely not be to Moscow’s liking, and so will be dead on arrival.

The European powers have been pushing for this to be as robust as possible, including Western troops to enforce the terms, and even air power – or a ‘European defense shield’.

“There has been a lot of talk about security guarantees. National security advisers are currently working on the development of each specific component, and next week the entire configuration will be on paper,” Zelensky added.

The reality is the sides are talking past each other, while cross-border attacks persist and even ramp up. This week saw Russia’s second-largest aerial deadly assault on Ukraine of the war, which included around 600 missiles and drones. Ukrainian officials are pushing for maximal demands from the West – perhaps now more than ever…

Retired Admiral Stavridis: Provide Ukraine more offensive weapons, more F-16s, more surface-to-surface missiles, confiscate Russia’s $300 billion frozen by the West, and integrate Ukrainians into every aspect of NATO so when the right moment comes they’ll get quick membership. pic.twitter.com/UzEZbE8lRZ

— Igor Sushko (@igorsushko) August 20, 2025

Russia will only see the prospect of EU troop enforcement as essentially bringing things back to square one, as the root cause of the war has been identified as NATO expansion up to Russia’s doorstep.