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100% Of Audited Medicaid Claims For Autism Care In Colorado Were Improper Or Flawed: Report

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100% Of Audited Medicaid Claims For Autism Care In Colorado Were Improper Or Flawed: Report

Authored by Sylvia Xu via The Epoch Times (emphasis ours),

Colorado’s Medicaid program made an estimated $77.8 million in improper payments and another $207.4 million in potentially improper payments for autism therapy, according to a February report from the Inspector General for the Department of Health and Human Services.

A sign in front of the Centers for Medicare and Medicaid Services building in Woodlawn, Md., on March 19, 2025. Kayla Bartkowski/Getty Images

Auditors investigated $289.5 million in Medicaid payments from 2022 to 2023 that paid for more than 1 million claims for Applied Behavior Analysis—a therapy used to treat autism and developmental disabilities.

Each of the 100 claims reviewed contained at least one improper or potentially improper payment, suggesting a 100 percent failure rate.

Improper payments are not necessarily fraudulent. Payments are considered improper when the claim does not meet federal or state requirements. Payments are potentially improper when the submitted claim is so poor or unreliable that auditors cannot verify that the services were provided correctly.

Claim Errors

In 93 of 100 claims examined, the billing providers either did not provide notes verifying that the therapy took place, didn’t provide the required signatures, or billed for more time than the notes indicated.

In 18 cases, the therapy that was supposed to be performed by a specialist—such as a Board Certified Behavior Analyst—was performed by staff without those qualifications.

In seven cases, the children receiving therapy lacked a current doctor’s diagnosis or referral on file.

In 88 cases, facilities billed for recreational activities that are not considered medical therapy, such as academic tutoring, day care, or custodial care. In one case, a facility billed for children swimming and playing on water slides.

In 76 cases, facilities billed for a full eight-hour day without subtracting time for naps, meals, or breaks.

Oversight and Safety Concerns

The report concludes that Colorado made these improper payments because it did not provide effective oversight. The state did not regularly review Medicaid payments to catch errors and failed to give clear guidance to therapy centers on how to bill or what counts as therapy.

Additionally, the state didn’t properly check if its prior authorization contractors were following the rules when approving therapy for children.

While the audit focused on money, it also uncovered problems that could affect the safety and quality of care.

Some staff members had criminal convictions for weapons offenses, assault, or driving under the influence. In one case, three staff members at a facility providing care to an 11-year-old child with autism had criminal histories.

A non-credentialed technician had a felony weapons offense conviction three months prior to treating children. A registered behavior technician had been convicted of misdemeanor assault and physical harassment, such as a strike, shove, or kick. Another behavior technician had an aggravated misdemeanor weapons conviction.

The state did not require background checks for these workers.

Previous Audits

The report comes as part of a series of seven Inspector General audits examining state Medicaid payments for autism therapy. Four are are complete and three remain in progress.

In previous audits, the agency estimated more than $120 million in improper payments and nearly $200 million in potential improper payments for Indiana, Wisconsin, and Maine.

The potential fraud, waste, and abuse in Medicaid autism therapy payments in Colorado was the highest among these audits.

The Office of Inspector General recommended that Colorado refund $42.6 million—the federal portion of the improper payments—to the federal government.

Also, the agency suggested that the state begin regular reviews of autism facilities to ensure they follow the rules and provide better training and guidance to facilities on documenting and billing for therapy.

The state of Colorado agreed to improve its guidance and conduct more regular reviews in the future, according to a statement. But it disagreed with the recommendation to refund the money, arguing that the audit derived its findings from a limited sample and didn’t have enough detail on the errors.

Further, Colorado argued that its Medicaid program does not require certification of behavior technicians before making payments, so the refund calculation based on this statute should be rescinded.

Tyler Durden
Thu, 03/05/2026 – 17:00

US Ambassador To UN Threatens Iran Counterpart: ‘Better Watch Himself In New York City’

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US Ambassador To UN Threatens Iran Counterpart: ‘Better Watch Himself In New York City’

Trump’s Ambassador to the United Nations Mike Waltz has issued a veiled threat to his Iranian counterpart, and the clip is going viral, which is likely to further delay the potential for any talks toward halting the war – which at this point still seem non-existent.

The spat first erupted Sunday, when Waltz ripped into Iran’s UN Ambassador Amir-Saeid Iravani, coming just a day after Operation Epic Fury started and the bombs were unleashed on Tehran.

Screengrab via The Australian

Walz had said at an emergency meeting of the UN Security Council, “Frankly, I’m not going to dignify this with another response, especially as this representative sits here in this body representing a regime that has killed tens of thousands of its own people and imprisoned many more simply for wanting freedom from your tyranny.”

But Walz later appeared on Fox Business, discussing the war and the exchange at the UNSC. That’s when he appeared to threaten Iravani on air, during Maria Bartiromo’s program:

“You know, I’m going to be kind here,” Waltz said, “but it wouldn’t surprise me if this guy ends up knocking on our door for asylum. This regime is falling apart, and they have abused, imprisoned, tortured their own people for far too long. They’ve threatened the world for far too long.”

Walz was then asked if he felt Iravani’s own rhetoric has posed a threat, and Waltz said the Iranian envoy had better watch himself while he’s in New York City.

“I can’t say how many American soldiers the Iranians have killed either at their hands or their proxies,” Waltz said. “I’m a Green Beret, not my first firefight, and he should be careful with his words sitting on American soil, and I’ll just leave it at that.”

Watch the on-air moment here:

The “be careful… on American soil” part of this is what’s raised eyebrows the most. Of course, UN grounds in NYC is considered international territory, and so this means Amb. Iravani is unlikely to venture too far out from the complex at this moment.

Conventionally, there’s strict international protocol in place regarding protection of diplomats and embassies, but increasingly ‘rules of war and diplomacy’ are being abandoned by all sides as the conflict spirals.

Tyler Durden
Thu, 03/05/2026 – 16:40

Systemic Risk: A 12-Order Cascading Analysis Of A Zero-Flow Strait Of Hormuz Closure

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Systemic Risk: A 12-Order Cascading Analysis Of A Zero-Flow Strait Of Hormuz Closure

Authored by Craig Tindale via X:

Executive Summary

The modern world order, having organized itself around efficiency, cost minimization, and logistical precision, has created a machinery of dependence so extreme that the interruption of one narrow corridor can propagate outward into a general crisis of civilization.

What appears at first as a maritime blockade is in fact the exposure of the entire global system as a hierarchy of brittle interdependencies.

Oil and LNG fail as inputs into electricity, fertilizer, shipping, chemicals, mining, manufacturing, and state finance.

As an example, The global polyester chain begins in petrochemicals. A severe disruption to hydrocarbon and petrochemical feedstocks cascades into PTA, MEG, polyester resin, filament, and fabric production, causing acute shortages, price spikes, and factory stoppages across synthetic-heavy apparel segments. The industry does not vanish overnight, but the low-cost, high-volume apparel model starts to break down.

From this follows a chain whose logic is cumulative: fuel inflation becomes fertilizer inflation; fertilizer inflation becomes food inflation; food inflation becomes urban instability, sovereign subsidy exhaustion, and ultimately hunger. In this sequence, food shortages are not a secondary humanitarian issue. They are one of the central political outcomes of the crisis, because modern populations do not experience systemic breakdown first through grand strategy, but through unaffordable bread, intermittent power, empty pharmacies, and possibly the collapse of public order. A globalised Arab Spring.

In this framework, hyperinflation emerges as the social expression of real physical bottlenecks. When energy-importing states are forced to acquire dollarized fuel at any price, when currencies weaken, when fertilizer and transport costs reprice an entire harvest cycle, inflation ceases to be cyclical and becomes coercive.

It enters every household budget and every state ledger at once. The result is the destruction of planning itself: firms cannot quote, governments cannot subsidize, and populations can no longer calculate the future. Under such conditions, credit markets seize up, foreign-exchange reserves drain, sovereign spreads widen, and the boundary between economic crisis and political crisis disappears.

Modern technical systems amplify rather than dampen this disorder. The loss of sour crude becomes a sulphur and sulphuric acid crisis; that chemical crisis becomes a copper and cobalt crisis; the metals crisis becomes a transformer, switchgear, and grid crisis; the grid crisis becomes a semiconductor crisis; and the semiconductor crisis becomes a compute and data-centre crisis.

Thus, the closure of a maritime strait reaches, by entirely material means, into the server rack, the hospital network, the payment system, the electrical substation, and the defence-industrial base. The myth that digital civilization floats above heavy industry is, in this scenario, extinguished. Compute is shown to rest on copper, transformers, stable voltage, LNG, and ships.

For humanity, the systemic risk is therefore total in scope even if uneven in distribution.

The most immediate suffering falls on import-dependent and fiscally weak societies: blackouts, food insecurity, unemployment, debt default, regime stress, and mass unrest. Yet the advanced economies do not escape. They experience industrial contraction, infrastructure delays, AI and semiconductor bottlenecks, strategic stockpiling, and the permanent repricing of security over efficiency. What begins as a supply shock ends as a transformation of the political economy. States abandon the fiction of neutral markets and move toward command allocation, export controls, emergency powers, and militarized trade corridors. Market price gives way to strategic rationing. Globalization does not simply slow; it hardens into armed blocs.

The ultimate conclusion is grim : the terminal danger in this model is not one shortage, nor one recession, nor even one war-risk premium.

It is the transition from a globally integrated commercial order into a world system governed by scarcity, coercion, and administrative triage.

In such a world, hunger, hyperinflation, sovereign failure, technological stagnation, and geopolitical militarization are not separate crises.

They are the normal operating features of a civilization that has discovered, too late, that its efficiency was built on concentrated fragility. The closure of Hormuz, under this analysis, is the event through which the modern world recognizes that its supply chains were never only economic structures, but the hidden constitution of social peace itself.

A multipolar world is a very complicated and dangerous world. As always, be careful what you wish for.

Such is the risk. The whole world will be compelled to support efforts to bring this situation under control immediately. China, the US, and Europe will have to work together.

The political cycle over the coming days and weeks is going to matter like never before.

Here are 10 likely and immediate crises

  • Polyester -> apparel The global polyester chain begins in petrochemical feedstocks. If naphtha, paraxylene, PTA, or MEG are disrupted, polyester fiber, yarn, and fabric output contracts sharply, and synthetic-heavy apparel production starts seizing up. Chain: Petrochemicals -> PTA/MEG -> polyester -> fabric mills -> garment factories

  • Natural gas -> fertilizer -> food The global nitrogen fertilizer chain begins with natural gas. If gas supply is disrupted, ammonia and urea production falls, farm input costs spike, and food systems come under pressure within a single planting cycle. Chain: Natural gas -> ammonia -> urea -> crop yields -> food prices

  • Sour crude / sulfur -> sulfuric acid -> copper The copper and cobalt extraction chain depends on sulfuric acid, which in turn depends heavily on sulfur recovered from sour hydrocarbons and smelting. If sulfur or acid supply is disrupted, leaching operations stall and electrification inputs tighten fast. Chain: Sour crude/sulfur -> sulfuric acid -> SX-EW/HPAL -> copper/cobalt -> grids and EVs

  • Propylene -> polypropylene -> medical and packaging The polypropylene chain begins in petrochemicals. If propylene supply is disrupted, packaging, medical disposables, and automotive plastics face shortages, forcing manufacturers to ration output or redesign products. Chain: Propylene -> polypropylene resin -> molded parts/films -> hospitals, food packaging, autos

  • Salt + power -> chlorine / caustic soda -> water treatment The chlor-alkali chain begins with salt and electricity. If that system is disrupted, chlorine and caustic soda output drops, putting water treatment, sanitation, PVC, and pulp processing under immediate stress. Chain: Salt + electricity -> chlorine/caustic soda -> water treatment/PVC/paper

  • Natural rubber + synthetic rubber -> tires -> freight The tire industry begins with natural and synthetic rubber. If either is severely disrupted, tire production contracts, replacement cycles stretch, and trucking fleets start operating under maintenance and logistics constraints. Chain: Rubber feedstocks -> tires -> trucking fleets -> freight movement -> retail supply

  • Iron ore + metallurgical coal -> steel -> construction and machinery The steel chain begins with iron ore and metallurgical coal. If either feedstock is constrained, steel mills cut output, and construction, auto manufacturing, shipbuilding, and heavy machinery start absorbing delays and cost shocks. Chain: Iron ore + met coal -> steel -> beams, sheet, machinery -> construction/autos/industry

  • Bauxite + alumina + cheap power -> aluminum -> transport and packaging The aluminum chain begins with bauxite, alumina refining, and very large amounts of electricity. If any of those are disrupted, smelting capacity drops and packaging, aerospace, transport, and power transmission all get hit. Chain: Bauxite -> alumina -> aluminum smelting -> cans, aircraft, cable, vehicle parts

  • Soda ash + natural gas -> glass -> buildings, autos, solar The flat glass chain depends on soda ash, silica, and high-temperature continuous furnaces fed by stable energy. If those inputs are disrupted, glass production cannot be easily paused and restarted, and shortages hit construction, autos, and solar manufacturing. Chain: Soda ash + silica + gas -> float glass -> windows, windshields, solar panels

  • High-purity gases and chemicals -> semiconductors -> electronics and autos The semiconductor chain begins with ultra-pure gases, photoresists, specialty chemicals, and stable power. If those inputs are disrupted, chip yields collapse, lead times extend, and electronics, autos, telecom, and defense manufacturing start choking on shortages. Chain: Neon/photoresists/ultra-pure chemicals + stable power -> wafers -> chips -> downstream manufacturing

Section 1: The Master Cascade, An Institutional Matrix

The systematic rationalization of global supply chains has constructed an extraordinary vulnerability.

The following matrix outlines the chronological and mechanical breakdown of the global system, from initial logistical paralysis to the ultimate civilizational redesign.

Caution – Remember, these are just my own thoughts and don’t represent certainty. It’s an extrapolation of what could happen, not what will. That said, it is a serious risk warning

  • Order 1: Maritime Flow Interruption (0–14 Days)The mechanism is an logistical gridlock of approximately 20.9M bpd in liquids and 80 mtpa in LNG, operating against maximized bypass pipelines. The binding bottlenecks are the Saudi Petroline and UAE Habshan capacity limits, which offer a maximum of 2.8M to 3.1M bpd in spare diversion, alongside severe VLCC availability constraints. The leading indicators of this phase are prompt-month Brent crude backwardation, VLCC ton-mile rates exceeding $423k/day, and the instantaneous cancellation of P&I War Risk Insurance.

  • Order 2: Refining & Industrial Chemicals (2–6 Weeks)The mechanism relies on the starvation of sour crude, yielding an immediate, unmitigable global deficit in elemental sulphur by-production. The physical bottlenecks are strict toxic transport limits, local refinery storage capacities, and concurrent Russian export bans. The leading indicators are domestic Chinese sulphuric acid pricing breaching 1000 yuan/ton and the abrupt halt of Qatari sulphur exports, removing 3.8M tpa from the market.

  • Order 3: Mining & Metals Extraction (1–3 Months)The mechanism is a profound sulphuric acid famine that forces the halt of Solvent Extraction and Electrowinning (SX-EW) and High-Pressure Acid Leaching (HPAL) operations for copper and cobalt. The bottlenecks manifest in shallow regional acid inventory buffers and Zambian cross-border rail constraints. Leading indicators include formal force majeures declared across the DRC and Zambian copper belts, with spot acid prices in Kolwezi surging past $700/tonne.

  • Order 4: Grids & Power Hardware (3–12 Months)The mechanism dictates that the copper deficit exacerbates an already chronic shortage of Large Power Transformers (LPTs) and high-voltage switchgear. The bottlenecks are the highly concentrated supply of GOES (Grain-Oriented Electrical Steel), inflexible vapor-phase drying limits, and extreme OEM lead times extending to 120–210 weeks. Leading indicators are Siemens Energy and Hitachi order backlogs swelling beyond €146B, accompanied by a surging Federal Reserve Transformer Price Index.

  • Order 5: Semiconductor Supply Chains (11–30 Days)The mechanism involves Taiwanese LNG starvation triggering mandatory grid rationing, exposing fabrication equipment to catastrophic voltage sags. The bottlenecks are defined by Taiwan’s statutory 11-day LNG reserve limit, strict SEMI F47 tool tolerance limits, and 28-week lead times for ABF substrates. Leading indicators include Taipower’s percent operating reserve (POR) collapsing, skyrocketing TSMC wafer scrap rates, and extreme spot LNG premiums.

  • Order 6: Compute & Data Centers (6–18 Months)The mechanism is the violent collision of silicon supply constraints with transformer unavailability, freezing GW-scale expansions entirely. The bottlenecks are a stagnant 2,600 GW US interconnection queue and interconnection wait times extending up to 7 years in PJM and Northern Virginia. Leading indicators are the public delays of AWS and NVIDIA capex deployments, alongside the structural pausing and cancellation of hyperscaler contracts.

  • Order 7: Capital Markets & Credit (1–6 Months)The mechanism centers on material cost inflation driving severe margin compression, causing high-yield industrials to reprice violently. The bottlenecks are heavy industrial balance sheet leverage and the rapid draining of Emerging Market FX reserves required to secure dollarized energy. Leading indicators include Siemens Energy credit spreads widening past 300 bps, the KRW/USD exchange rate breaching 1460, and the INR hitting record lows.

  • Order 8: State Response Layer (13–90 Days)The mechanism involves sovereign authorities enacting SPR drawdowns and utilizing the DPA, only to be subordinated by uncompromising pipe and cavern physics. The bottlenecks are the SPR’s maximum daily hydraulic drawdown limit of 4.4M bpd and a strict 13-day lag for physical market entry. Leading indicators are US DOE spot-price indexed solicitation data and the issuance of federal mandates via the Defense Production Act.

  • Order 9: Trade Architecture (1–3 Years)The mechanism is the multi-year restructuring of maritime supply lines, marked by the acceleration of Petroyuan usage as dollar liquidity drains from the system. The bottlenecks are absolute global shipbuilding capacity limits, with Asian yards fully booked into 2029, and the constraints of an aging VLCC fleet. Leading indicators are surging non-dollar energy settlement volumes, newbuild VLCC orders, and shipyard utilization rates.

  • Order 10: Social Stability (6–12 Months)The mechanism traces extreme energy and fertilizer (ammonia/urea) inflation directly into structural food crises across Emerging Markets. The bottlenecks are the exhaustion of sovereign fiscal space and heavily import-reliant energy profiles in states like Egypt, Turkey, and Pakistan. Leading indicators include sovereign CDS spreads rupturing past 600 bps, formal EM debt defaults, and emergency IMF Extended Fund Facility interventions.

  • Order 11: Industrial Structure Shifts (2–5 Years)The mechanism is the forced substitution of aluminum for copper, which immediately strikes the physical and thermodynamic limits of engineering. The bottlenecks are aluminum’s inferior 61% IACS conductivity and its high thermal expansion and creep in dense grid environments and EV motors. Leading indicators are mass corporate hardware redesign announcements and shifting structural Cu/Al price ratios.

  • Order 12: Civilizational Redesign (5+ Years)The mechanism represents the terminal shift: the doctrine of economic efficiency is permanently subordinated to the bureaucratic mandate of resource security, resulting in industrial autarky. The bottlenecks are the limits of capital allocation, the physical militarization of supply chains, and the massive inflationary costs of near-shoring. Leading indicators are sweeping structural tariff escalations and massive strategic mineral stockpiling FIDs, such as the US Project Vault.

Section 2: The 12-Order Deep Dive

Order 1: Maritime Flow Interruption

The Strait of Hormuz stands as the ultimate geographical monopoly over the global hydrocarbon economy. Its spatial reality, measuring a mere 21 miles wide at its narrowest point, with functional shipping lanes strictly demarcated by a two-mile buffer zone, constructs an unparalleled architecture of systemic vulnerability. A zero-flow closure instantaneously strands between 20.7 and 20.9 million barrels per day (bpd) of crude oil, condensate, and refined petroleum products. This volume dictates the terms of global trade, representing over 20% of global liquid consumption and more than 25% of the total seaborne oil market. Concurrently, a staggering 10.5 to 11.4 billion cubic feet per day (Bcf/d) of Liquefied Natural Gas (LNG), equating to roughly 80 million tonnes per annum (mtpa), or 20% of the entire global LNG trade, is physically trapped within the Persian Gulf. Qatar alone is responsible for 9.3 Bcf/d of this trapped volume, with an overwhelming 83% to 84% of these cargoes historically destined to feed the energy-starved industrial machines of Japan, South Korea, China, and Taiwan.

The prevailing market assumption that regional pipeline infrastructure offers salvation is mathematically false. The rationalization of bypass routes reveals severe limitations:

  • Saudi East-West Petroline: Boasting a nameplate capacity of 5.0 million bpd, this route from Abqaiq to the Red Sea port of Yanbu offers only an estimated ~2.4 million bpd of functional spare capacity. Crucially, the system cannot simultaneously fill buffer storage and maximize loading rates for VLCCs.

  • UAE Habshan-Fujairah Pipeline: Routing from Abu Dhabi to the Gulf of Oman, its 1.5 million bpd nameplate capacity is heavily constrained by existing utilization, providing a mere 0.4 to 0.7 million bpd of functional relief.

Combined, this optimal pipeline diversion achieves only 2.8 to 3.1 million bpd, guaranteeing an absolute, unmitigated physical supply deficit exceeding 17.5 million bpd of liquids globally.

The immediate bureaucratic reaction of the market is a hyper-spike in the Very Large Crude Carrier (VLCC) ton-mile multiplier. Protection and Indemnity (P&I) Clubs, the institutional gatekeepers covering 90% of global commercial tonnage, issue standard 72-hour notices of war-risk insurance cancellations. This actuarial withdrawal instantly idles upwards of 40 VLCCs and 13 LNG tankers within the Gulf. Consequently, VLCC freight rates on alternative global routes detonate. Benchmark Persian Gulf-to-China TD3 rates have previously spiked to W419 on the Worldscale index (approximately $423,736 per day) under lesser kinetic threats, pushing lumpsum US Gulf Coast-to-China voyages into the $20 million to $21.5 million range. Prompt-month backwardation on ICE Brent shatters historical norms as refineries blindly bid for survival barrels, structurally repricing the benchmark past $100/bbl, with extreme disruption models projecting a grim equilibrium between $108 and $140/bbl.

Order 2: Refining & Industrial Chemicals

The starvation of Middle Eastern crude imposes a harsh chemical calculus upon the global industrial sector. The majority of crude transiting the Strait is classified as “sour,” defined by a naturally occurring sulphur content exceeding 0.5% by weight. The bureaucratic mandate of global environmental fuel standards dictates that refineries must subject this crude to rigorous hydrodesulfurization, predominantly utilizing Claus technology, which operates at an inflexible 98% recovery efficiency. Thus, the petroleum sector operates as the world’s primary, involuntary producer of elemental sulphur.

The sudden erasure of 17.5 million bpd of sour Gulf crude, coupled with the shutdown of integrated gas-processing megaliths, like QatarEnergy’s Ras Laffan complex, which processes 10,000 tonnes of liquid sulphur daily, removes an exact 3.8 million tonnes of annual sulphur capacity from the global balance. This eliminates approximately 8% of the worldwide seaborne sulphur trade overnight.

This void immediately throttles the $35.13 billion global sulphuric acid (H₂SO₄) industry. As the foundational chemical for modern rationalized industry, it is non-negotiable for phosphate fertilizer production, wastewater treatment, and metallurgical leaching.

  • Pricing Volatility: The market responds with merciless volatility. Domestic Chinese smelter-grade sulphuric acid prices possess the proven capacity to surge 113% year-over-year, vaulting from 400 yuan/ton to over 1,170 yuan/ton during minor historical mismatches. Under a Hormuz closure, these numbers will shatter records.

  • Logistical Constraints: Sulphuric acid is toxic, highly corrosive, and ensnared in transport regulations. Global inventory coverage is perilously thin, measured in mere days or weeks. Furthermore, geographical arbitrage is physically impossible; the substance requires specialized, lined railcars and designated chemical tankers. Import-dependent industrial sectors are simply stranded by the physics of transport.

Order 3: Mining & Metals Extraction

The cascading sulphuric acid famine systematically paralyzes hydrometallurgical base metal extraction, inflicting acute devastation upon the Central African Copperbelt.

  • DRC & Zambia Exposure: The Democratic Republic of the Congo (DRC) and Zambia stand as the indispensable pillars of electrification, commanding approximately one-sixth of global copper output (the DRC producing 3.3 million tons, Zambia 680,000 tons in 2024) and over 70% of global cobalt supply. This output is entirely captive to the chemical requirements of Solvent Extraction and Electrowinning (SX-EW) for oxide copper ores, and High-Pressure Acid Leaching (HPAL) for cobalt and nickel. Both demand a relentless, uninterrupted deluge of sulphuric acid.

  • Acid Buffers and Force Majeure Risks: The region is structurally deficient in sulphur. The DRC alone is forced to import over 500,000 tonnes of elemental sulphur annually to feed its local sulphur-burning acid plants. In a zero-flow scenario, these seaborne imports vanish. Zambia will inevitably execute a sovereign override, instituting acid export bans to protect its domestic mining survival. Survival becomes a function of vertical integration: Ivanhoe Mines’ Kamoa-Kakula complex relies on a captive direct-to-blister smelter producing 1,200 tonnes per day of 98%-pure acid (400,000 tonnes annualized), offering a rare operational fortress. Conversely, standalone SX-EW and HPAL operations face mandatory force majeure as regional spot acid prices in Kolwezi violently breach $700 per tonne.

  • Chilean Contagion: Across the Pacific, Chile’s state-owned Codelco relies on bacteria-assisted bioleaching and SX-EW processes at colossal sites like Escondida, sustained by acid recycled from local solvent extraction and domestic smelting. Yet, as global acid prices ascend to unprecedented heights, merchants are heavily incentivized to export acid rather than supply domestic Chilean operations, forcing an artificial structural slowdown across South America’s primary copper veins.

Order 4: Grids & Power Hardware

The resulting base metal deficit collides with the pre-existing gridlock of the heavy electrical equipment supply chain. The rationalized goals of the renewable energy transition and the explosive electrification of AI data centers are entirely beholden to the availability of Large Power Transformers (LPTs) and high-voltage metal-clad switchgear.

  • OEM Backlogs & Lead Times: The manufacturing oligopoly, Siemens Energy, Hitachi Energy, and GE Vernova, is operating against the hard limits of physical capacity. Siemens Energy reported a staggering, record-breaking total order backlog of €146 billion in early 2026, driven by a 21.8% year-over-year surge in its Grid Technologies division. Capital interventions are underway, Hitachi Energy’s $1.5 billion injection into Virginia and Poland, and Siemens Energy’s €220 million Nuremberg expansion, but capital cannot instantly alter physical reality. Consequently, LPT lead times (100 MVA and above) have stretched from a historical baseline of 50 weeks to a new norm of 120 weeks, with ultra-high-voltage units demanding up to 210 weeks, or over four years of waiting.

  • The GOES Bottleneck: The ultimate constraint is not merely copper, but Grain-Oriented Electrical Steel (GOES), an engineered iron-silicon alloy requisite for minimizing magnetic core transmission losses. In the US, this supply is a functional monopoly dictated by Cleveland-Cliffs. Scaling the production of premium ultra-thin GOES (below 0.27 mm) requires glacial multi-year qualification cycles and prohibitive capital outlays of $500 to $700 million for bell-anneal lines.

  • Chemical/Physical Limits: LPT manufacturing cannot be optimized through software. The vapor-phase drying process required for the transformer core’s cellulose insulation is an inflexible chemical curing cycle. It submits to the laws of chemistry, not the agile demands of the market.

Order 5: Semiconductor Supply Chains

Taiwan’s structural energy procurement framework ensures that the entire global semiconductor supply chain is acutely exposed to the mechanics of a Hormuz closure.

  • LNG Starvation: The island’s industrial apparatus requires importing nearly 98% of its total energy, with state-owned Taipower relying on LNG for 42% to 47% of its total electricity generation. Crucially, roughly 30% of this LNG is sourced directly from Qatar. The vulnerability is legally hardcoded: Taiwan’s statutory security storage requirement for LNG is a critically low 11 days. A cessation of Qatari flows, met by a desperate global bid for Atlantic cargoes, guarantees that Taipower’s percent operating reserves (POR) will collapse within two weeks. The inevitable bureaucratic response is mandated grid rationing and rolling industrial brownouts.

  • Voltage Sag Tolerance Limits: The foundries of the Taiwan Semiconductor Manufacturing Company (TSMC) demand absolute electrical perfection. Governed by the SEMI F47-0706 standard, advanced semiconductor processing and metrology tools are engineered to withstand voltage sags of 50% for exactly 200 milliseconds (0.2 seconds), 70% for 0.5 seconds, and 80% for 1 second. Historical precedent at the Hsinchu Science Park proves that a microsecond drop of a mere 0.1 seconds (at 79% to 95% nominal voltage) triggers massive internal tool failures, resulting in the catastrophic scrapping of tens of thousands of wafers and hundreds of millions in vaporized capital.

  • ABF Substrate Chokepoints: Simultaneously, the advanced packaging of completed silicon faces an intractable chemical bottleneck. Ajinomoto Build-up Film (ABF) substrates, the essential insulators for high-performance computing, are trapped behind 28-week lead times. The laser-drill capacity required to manufacture them is monopolized by LPKF Laser and Mitsubishi Electric, both groaning under 18-month backlogs. This restricts key suppliers like Ibiden and Shinko Electric, choking the final assembly lines of NVIDIA and AMD.

Order 6: Compute & Data Centers

The intersection of Order 4 (transformer gridlock) and Order 5 (silicon fabrication failures) imposes a hard, mathematical stop upon the AI infrastructure supercycle.

  • Interconnection Queues: The institutional forecast for US summer peak demand growth skyrocketed to 166 GW in 2025, with data centers commanding 55% of this burden. The bureaucratic reality is a massively overloaded US interconnection queue, suffocating under 10,300 projects representing a 2,600 GW backlog. The friction of unpredictable delays and exorbitant grid upgrade costs has driven the project withdrawal rate to nearly 80%.

  • Time-to-Power Constraints: In critical digital geographies like Northern Virginia (the PJM footprint), GW-scale facilities face power interconnection wait times extending up to 7 years. Hyperscalers, AWS, Google, Meta, attempt to circumvent this reality by purchasing land for behind-the-meter gas generation. Yet, without the physical delivery of high-voltage switchgear and LPTs, these commercial operation dates are entirely fictitious. The metric of “speed-to-power” becomes an impossibility, threatening widespread capital expenditure cancellations and leaving billions locked in sterile real estate and dormant silicon.

Order 7: Capital Markets & Credit

The failure of physical supply chains translates directly into the financial system via rapid, unrelenting corporate margin compression and the vaporization of foreign exchange liquidity.

  • High-Yield Repricing: The heavy industrial conglomerates that build the world’s architecture are the first to absorb material inflation. Siemens Energy, bound by complex global execution and wind turbine logistics, has previously watched its bonds widen beyond 300 bps over mid-swaps, trading worse than BB+ high-yield peers, due to fixed-price contract overruns. As copper and specialized steel costs enter hyper-inflation, these OEM contracts bleed cash, ensuring credit downgrades and structural debt restructuring across the sector.

  • EM FX Depletion: Emerging markets tethered to dollar-denominated oil imports face the brutal mathematics of FX reserve depletion. At $100+ per barrel, central banks must hemorrhage dollar reserves merely to sustain baseline domestic survival. Currency acts as the immediate shock absorber. The South Korean Won (KRW) possesses high beta sensitivity to energy, previously surging past 1,462 per dollar during kinetic shocks. The Indian Rupee (INR) and Thai Baht face identical downward violence, embedding imported inflation deep into the domestic economy and obliterating local liquidity.

Order 8: State Response Layer

Faced with the collapse of the market mechanism, sovereign entities assert their monopoly on power through strategic overrides. Yet, these decrees remain strictly bounded by the inflexible laws of physics and hydraulic engineering.

  • US Strategic Petroleum Reserve (SPR) Limitations: The US SPR houses approximately 411 million barrels inside 61 engineered salt caverns across Texas and Louisiana. Politically, it is a weapon; physically, it is a pipe. The absolute maximum nominal hydraulic drawdown capability is strictly capped at 4.4 million bpd. Furthermore, the bureaucratic friction of execution ensures a 13-day lag from Presidential signature to physical market entry. Consequently, running at maximum stress, the SPR replaces only ~25% of the 17.5M bpd global shortfall. The system remains fundamentally starved. Prolonged extraction at these rates also risks severe dilatant and tensile stresses, threatening the structural integrity of the salt walls themselves.

  • Defense Production Act (DPA): The executive branch will inevitably invoke the DPA to forcibly reallocate domestic GOES and LPT production toward critical defense and civilian grid triage. However, administrative edicts cannot accelerate the chemical curing time of transformer insulation, nor can they summon specialized metallurgical engineers or conjure the heavy-haul railcars necessary to move 400-ton monoliths. The DPA does not create new supply; it merely engineers a rigid reallocation of poverty.

Order 9: Trade Architecture

The irrecoverable loss of the Persian Gulf corridor demands a multi-year restructuring of global maritime routes, exposing the severe limitations of global shipbuilding capital.

  • Shipbuilding Limits: The capacity to forge new vessels is heavily monopolized, with Chinese yards controlling 46% of total capacity (securing over 68% of new orders in late 2025) and South Korea commanding 25%. Western attempts to commission smaller bypass tankers or dedicated US-to-Asia LNG carriers hit an unyielding wall: premier Asian shipyards are entirely booked through 2028, with delivery cycles for high-end vessels dragging into 2029. The global VLCC fleet cannot rapidly scale to absorb the massive ton-mile inflation of Cape of Good Hope routing; effective fleet growth is structurally capped below 3% annually, compounded by the reality that nearly 20% of existing VLCCs are over 20 years old and destined for the shadow fleet or the scrapyard.

  • Petroyuan Acceleration: As dollar liquidity evaporates from the treasuries of Emerging Markets (Order 7), China deploys its strategic petroleum reserves and dominant refining infrastructure to exert geopolitical leverage. By issuing yuan-denominated swap lines to distressed Asian neighbors in exchange for refined products or access to overland Russian pipelines, Beijing forces the structural de-dollarization of East Asian energy trade, cementing the Petroyuan as the dominant mechanism for crisis survival.

Order 10: Social Stability

The inflation of core energy inputs directly degrades agricultural yields, efficiently translating a logistical bottleneck into a humanitarian catastrophe. Natural gas serves as the indispensable chemical feedstock for ammonia, the basis of urea and complex nitrogen fertilizers.

  • Fertilizer Shocks: With 40% to 50% of the world’s internationally traded nitrogen-based fertilizers originating from or passing through the Gulf, a Hormuz closure dictates an immediate, violent spike in agricultural input pricing. This mathematically guarantees elevated global food prices within a single harvest cycle.

  • Sovereign Debt Defaults: Sovereigns bearing high debt burdens and heavy import reliance face immediate insolvency as they attempt the impossible task of subsidizing fuel and food for their populations. Egypt, currently navigating an $8 billion IMF Extended Fund Facility with structural inflation and high LNG reliance, and Turkey, battling 10-Year Government Bond yields exceeding 31%, sit on the precipice of ruin. Their sovereign Credit Default Swap (CDS) spreads will violently breach the 600 bps distress threshold as FX reserves vanish. The sheer inability to procure fuel and fertilizer guarantees widespread power rationing, collapsing food security, and profound social unrest across North Africa and South Asia.

Order 11: Industrial Structure Shifts

Desperate to circumvent base metal scarcity (Order 3) and spiraling grid hardware costs (Order 4), the industrial complex attempts mass material substitution. The pivot from copper to aluminum, however, crashes instantly into the uncompromising laws of thermodynamics.

  • Conductivity and Spatial Limits: Aluminum offers a mere 61% of copper’s electrical conductivity on the IACS scale. To transmit an identical electrical current, the aluminum conductor demands a 1.6x larger cross-sectional area. In the spatial austerity of EV drivetrains, aerospace architecture, and high-density AI server racks, accommodating this added bulk is a physical impossibility without initiating multi-year, ground-up engineering redesigns.

  • Thermal Loads and Creep: Aluminum’s thermal conductivity is severely deficient (237 W/mK against copper’s 401 W/mK), failing to dissipate heat under high-load conditions. Moreover, aluminum exhibits a profound susceptibility to thermal expansion and “creep”, the cold flow away from pressure. Subjected to the intense mechanical vibrations of electric motors or industrial generators, this creep guarantees loose connections, spiking electrical resistance, and catastrophic fire hazards. Substitution is not an agile pivot; it is a hazardous, multi-year engineering commitment.

Order 12: Civilizational Redesign

The terminal phase of the cascade marks the permanent institutionalization of a new paradigm: “economic efficiency” is eradicated, replaced entirely by the doctrine of “resource security.” The illusion of Just-In-Time global logistics is shattered. Capital allocation pivots with extreme prejudice toward autarkic industrial policy. Sovereign wealth funds and defense budgets are forced to internalize the astronomical premiums of near-shoring critical supply chains, evidenced by policies like the US government’s $12 billion “Project Vault” to hoard domestic cobalt and sever Chinese dependencies.

To safeguard what remains of international trade, alternative maritime chokepoints, such as the Strait of Malacca and the Panama Canal, submit to overt, permanent naval militarization. The rationalized global economy formally fragments, abandoning the pursuit of free trade to operate as a system of heavily armed, partitioned, and aggressively redundant macro-blocs.

Section 3: Scenario Stress-Test Matrix

Subjecting this architecture to distinct temporal stresses reveals the precise breaking points of the global system.

Scenario A: Short Shock (≤ 14 days)

  • Top 5 Binding Constraints: The absolute physical stranding of 17.5M bpd of oil and 80 mtpa of LNG. Total withdrawal of P&I Club War Risk Insurance, instantly freezing off-shore tanker movement. Taiwan’s precarious 11-day statutory LNG reserve limit. The US SPR’s rigid 13-day temporal lag to physically inject its 4.4M bpd maximum into the market. Maximum functional bypass pipeline limits (Saudi/UAE capped at ~3.1M bpd).

  • First Two Structural Breaks: Spot LNG Markets: Panic buying shatters TTF and JKM pricing ceilings as European and Asian utilities irrationally bid up Atlantic cargoes to secure baseload survival. Taiwanese Grid Stability: Breaching the 11-day LNG buffer forces Taipower’s percent operating reserves (POR) below critical thresholds, necessitating immediate rolling blackouts across industrial zones.

  • Dominant Macro-Drivers: Orders 1 (Maritime Logistics), 5 (Semiconductor Power Security), and 8 (State SPR Response).

Scenario B: Medium Shock (1–3 months)

  • Top 5 Binding Constraints: Extreme depletion of EM Foreign Exchange reserves (KRW, INR) driven by dollar-denominated energy hyper-inflation. Global elemental sulphur shortage resulting from the total removal of Qatar’s 3.8M tpa capacity. Spot sulphuric acid prices (>1000 yuan/ton) obliterating the operating margins of base metal refiners. SEMI F47 voltage sag limits (50% drop for 0.2 seconds) breached at TSMC fabs due to sustained Taiwanese grid rationing. Codelco and African Copperbelt SX-EW hydrometallurgical operations forced into shutdown due to chemical starvation.

  • First Two Structural Breaks: Advanced Node Semiconductor Yields: Microsecond voltage sags across Taiwan trigger massive wafer scrap events and equipment recalibration delays, crippling advanced AI chip output. Base Metal Mining Force Majeures: SX-EW copper and HPAL cobalt mines in the DRC and Zambia officially issue force majeure as toxic sulphuric acid cannot physically be transported fast enough to replace local deficits.

  • Dominant Macro-Drivers: Orders 2 (Industrial Chemicals), 3 (Mining Extraction), and 7 (Credit & FX).

Scenario C: Long Shock (≥ 6 months)

  • Top 5 Binding Constraints: LPT lead times extending structurally beyond 210 weeks as copper input supply lines fail. Absolute exhaustion of global GOES production capacity and specialized bell-anneal capital expenditures. The 2,600 GW US interconnection queue permanently frozen due to the total lack of high-voltage switchgear. Sub-3% global VLCC fleet growth capacity, tightly restricted by Asian shipyards booked entirely through 2029. The thermodynamic impossibility of rapidly substituting aluminum for copper in high-thermal load EV and AI hardware.

  • First Two Structural Breaks: AI/Compute Capex Freeze: Hyperscalers (AWS, Meta) and semiconductor developers (NVIDIA) cancel multi-billion dollar deployments as the lack of switchgear and LPTs shoves commercial operation dates into the next decade. Emerging Market Sovereign Default: Heavily exposed nations (Turkey, Egypt, Pakistan) completely exhaust their fiscal space attempting to subsidize imported ammonia/urea and diesel, triggering systemic CDS defaults and requiring emergency IMF bailouts.

  • Dominant Macro-Drivers: Orders 4 (Grid Hardware), 6 (Compute Scaling), 10 (Social & Sovereign Stability), and 11 (Industrial Redesign).

Section 4: Terminal Stopping Rule

The 12-Order Cascading Systems Shock ceases to function as a predictive analytical framework beyond Order 12 because the causal pathways abandon exogenous linearity and become entirely endogenous and recursive.

Upon reaching Civilizational Redesign (Order 12), the panicked interventions of sovereign states and industrial monopolies generate infinite feedback loops that rewrite the foundational variables. The starvation of copper (Order 3) ensures the permanent halt of LPT production (Order 4), which directly barricades heavy electrical grid expansion (Order 6). Lacking grid expansion, the massive baseload power required to drive advanced smelting, desalination, and mining operations (Order 3) is suffocated, locking the system into a self-consuming industrial death spiral.

Furthermore, as the state apparatus enforces autarkic industrial policies and militarizes supply lines, the traditional metrics of market equilibrium, price elasticity, and marginal cost evaporate. Prices are no longer discovered; they are dictated by state decree, retaliatory export bans, and strategic hoarding (as demonstrated by China’s domestic sulphur export caps and the US execution of Project Vault).

Predictive quantitative macroeconomics shatters against this reality. Standard modeling of lead times and material substitution fails because commodities are transformed into direct kinetic weapons, and maritime trade routes submit to naval dominance rather than arbitrage. Thus, beyond Order 12, the paradigm shifts entirely: the global system can no longer be modeled as a supply-chain shock; it must be understood as the permanent bureaucracy of geopolitical total war.

Tyler Durden
Thu, 03/05/2026 – 16:20

Indiana Governor Signs Bill Allowing Crypto In Retirement Plans

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Indiana Governor Signs Bill Allowing Crypto In Retirement Plans

Authored by Stephen Katte via Cointelegraph,

Indiana will start allowing certain retirement and savings plans to include crypto investments and has enacted stronger legal protections for the crypto industry under a newly signed bill. 

Governor Mike Braun signed House Bill 1042 into law on Tuesday, after it passed the legislature last Thursday. The legislation requires Indiana’s state public retirement and savings plans to offer self-brokerage accounts with at least one crypto investment option by July 2027.

According to the bill’s description, this requirement applies to the legislators’ defined contribution plan, the Hoosier START plan, certain public employees’ retirement funds, and specified teachers’ retirement fund plans.

More institutions are adopting digital assets, with Bitbo estimating that over 3.7 million Bitcoin (worth $258 billion) are held by publicly traded and private companies, exchange-traded funds and governments.

Protections for crypto payments and mining

The bill also includes provisions to protect the rights of crypto users. Under the legislation, public agencies — except the Department of Financial Institutions — are barred from adopting or enforcing rules that ban crypto payments, self-custody or mining.

The bill also clarifies that a money transmitter license isn’t required for apps and software protocols that allow non-custodial transfers.

Local governments, such as counties, municipalities, or townships, also can’t single out crypto mining businesses or home miners with special restrictions not applied to similar businesses or activities in the same zoning area.

Noise from crypto mining operations has caused friction in other states. Residents in Hood County, Texas, attempted to form a new municipality to regulate noise from a local mining facility last year. 

Access to retirement funds a boon for crypto

At the federal level, President Donald Trump’s August executive order “Democratizing Access to Alternative Assets for 401(k) Investors” directed the SEC to make alternative assets like crypto more accessible in participant-directed retirement plans.

Some analysts, such as Tom Dunleavy, the head of venture at Varys Capital and a former senior analyst at Messari, predicted that even a 1% allocation to crypto in 401(k)s could bring in $120 billion in new flows.

Tyler Durden
Thu, 03/05/2026 – 15:45

UBS Discusses Next Maritime Chokepoint Investors Should Watch

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UBS Discusses Next Maritime Chokepoint Investors Should Watch

A lot of attention has centered on the Strait of Hormuz since the waterway was effectively shut not only by the IRGC drone threat, but mostly because maritime insurers are withdrawing war-risk coverage across the region. Our focus now shifts to the other critical maritime chokepoints. If Washington can pressure Iranian oil flows and, by extension, curb China’s cheap Gulf crude flows, then the Taiwan Strait and South China Sea also emerge as potential flashpoints that traders can no longer afford to ignore.

For more color on which critical maritime chokepoints and geopolitical flashpoints investors should watch next, Bilahari Kausikan, former Permanent Secretary of Singapore’s Ministry of Foreign Affairs, spoke with UBS’s Aditi Samajpati at the 14th UBS OneASEAN Summit in Singapore to discuss the issue earlier on Thursday.

Kausikan told Samajpati that China claims about 80% of the South China Sea, but other surrounding countries reject those claims, and none of the disputes are likely to be resolved in the near term. He described the situation in the highly disputed waterway as a “strategic stalemate,” not an immediate crisis, because China is unlikely to openly block trade or challenge freedom of navigation if doing so risks war with the U.S.

“Obviously, the South China Sea is another point of vulnerability. There are multiple disputes, and China claims about 80% of the South China Sea, which is not accepted by the surrounding states,” he said.

“But I think overall the situation in the South China Sea – by the way, none of these disputes are going to be resolved – but I think overall it is not ideal, but not dire,” Kausikan said.

He continued, “It’s a strategic stalemate. On the other hand, the Chinese cannot stop the US and other powers from operating in the South China Sea, without risking war.”

Kausikan pointed out that the presence of the U.S. Navy should be viewed as a stabilizing force that preserves trade flows and prevents China from turning its claims into uncontested control.

Regarding U.S. pressure on Venezuela and Iran, Kausikan said it is unclear whether Washington’s goal is specifically to squeeze China’s crude imports, but it could have that effect, since both countries are critical, cheap crude suppliers to China.

At the same time, he said Trump’s willingness to provide naval escort to commercial traffic through Hormuz suggests the U.S. is not trying to completely choke off China, but rather to create leverage.

For Asia as a whole, Kausikan said energy stability should be a major issue across the region. He said ASEAN’s best path toward greater strategic autonomy is deeper energy integration, especially through a shared regional grid that could combine nuclear, hydro, and other power sources.

To sum up, China and the rest of Asia received a giant wake-up call this week as cheap crude and LNG flows from the Gulf were curtailed. All of this is happening ahead of President Trump’s trip to China later this month.

We think readers should keep a close eye on other maritime chokepoints worldwide.

Spillover risks from the Middle East conflict are building. The question now is: where is the next powder keg to go off? 

Tyler Durden
Thu, 03/05/2026 – 15:31

Trump Says He’ll Help Pick Iran’s Next Leader As Tehran Signals Readiness For US Ground Invasion

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Trump Says He’ll Help Pick Iran’s Next Leader As Tehran Signals Readiness For US Ground Invasion

Summary:

  • President Trump told Axios in an interview Thursday that he needs to be personally involved in selecting Iran’s next leader — just as he was in Venezuela.

  • Trump supports Kurds launching an offensive in Iran, tells Reuters: “I think it’s wonderful if they want to do that.”

  • Little Azerbaijan talks big: President reportedly announced his country’s army is planning an assault on the regime in Iran, as a direct response to the regime’s attacks.

  • Qatari fighter jets intercepted Iranian bombers that came within minutes of striking al-Udeid, the largest US military base in the Middle East: CNN

  • At least 1,230 Iranians killed since Saturday in actions increasingly described as a regime-change operation, as war widens into Lebanon, Gulf targets pounded, and even Azerbaijan sees first Iranian drone strike – shuts airspace. Iran says over 3,600 civilian sites damaged. Also more missiles on Dubai. At least six US troops killed, but Pentagon has not released new casualty updates.

  • US Senate last night voted 53–47 to block an effort to limit Trump’s Operation Epic Fury, allowing the campaign to continue as Washington signals deeper strikes inside Iran.

  • WH hopes for ‘quick victory’ fade as it widens geopolitically/economically, with US allies weighing involvement, NATO intercepting a missile heading toward Turkey, evacuation operations underway across the region.

  • European countries send naval assets to Cyprus, Italy sends ‘defensive’ equipment in wake of Iranian-made drone attacks on UK base.

  • Iran’s ‘Missile Cities’ a threat, but WSJ says “US and Israeli war planes and armed drones are circling over the dozens of cavernous bases, striking missile-carrying launchers when they emerge to fire.”

  • UN says 20,000 seafarers, 15,000 passengers stuck in Gulf as State Dept and others initiate evacuation plans.

  • Israeli military says it knocked out 300 Iranian ballistic missile launchers, but Tel Aviv also got pummeled overnight as many projectiles made it through air defenses.

  • Trump: “We have a lot of winners, but Spain is a loser, and UK has been very disappointing.”

  • Price of US oil benchmark up more than 5% due to US-Israel war.

  • Deposed Sha’s son Reza Pahlavi calls for Iranian officials to ‘hand over power immediately’ – also amid reports that US/Israel might purse Kurdish proxy ground op.

* * *

Update(1130): Among the ongoing flurry of war headlines, one which just broke via Axios provides the world with a better picture as to the future trajectory of the US-Israeli ‘regime change’ operation in Iran:

President Trump told Axios in an interview Thursday that he needs to be personally involved in selecting Iran’s next leader — just as he was in Venezuela.

Trump acknowledged that Mojtaba Khamenei, son of assassinated supreme leader Ali Khamenei, is the most likely successor — while making clear he finds that outcome unacceptable.

The Council of Experts have officially said they’ve postponed the announcement of the new supreme leader, but speculation abounds. Still, an announcement could be imminent.

For anyone that’s paid attention for the last 20+ years of America’s regime change wars in the Middle East and elsewhere, even if Washington leaders say “no boots on ground” all day long, they are still making “pledges” which ensures or ‘commits’ to a series of escalation steps leading to just that.

Ground invasion would be a disaster, more than likely…

Trump said to Axios: “They are wasting their time. Khamenei’s son is a lightweight. I have to be involved in the appointment, like with Delcy [Rodriguez] in Venezuela.” He added: “Khamenei’s son is unacceptable to me. We want someone that will bring harmony and peace to Iran.”

And very alarming for the prospect of a long quagmire which could endure for years, just like the Iraq war:

He added that he refuses to accept a new Iranian leader who would continue Khamenei’s policies, which he said would force the U.S. back to war “in five years.”

Destruction ongoing in both Tel Aviv and Tehran (below)…

* * *

The United States and Israel continue their history-shaping shock and awe style military campaign against Iran, with Israeli forces also now intensifying strikes in Lebanon. Since Saturday, at least 1,230 people have been killed in what’s clearly morphed into a regime change operation on Tehran, according to official numbers, which are expected to climb by the day. The war is expanding to nearby countries like Azerbaijan, and possibly even Turkey – in addition to the Gulf states.

Crucially, in Washington the US Senate blocked an effort to curb President Trump’s Operation Epic Fury, voting 53–47 against a procedural motion aimed at limiting the operation. Meanwhile Iran is going increasingly ‘gloves off’ in its response, with Tehran officials saying the war is expanding beyond just direct airstrikes. All the while, President Trump is still seeking ‘quick victory’ – the NY Times says Thursday. It writes, “his calculation has been that he can launch military operations with the loss of few American lives and minimal disruption to the economy. The opening days of the war in Iran are challenging that assumption.” The report continues:

Already, six Americans have been killed. Gulf allies are under attack. The stock market wobbled. Gas prices are rising. The U.S. military is spending, by some estimates, hundreds of millions of dollars per day. In Iran, an airstrike on a girls’ elementary school killed 175 people, according to local health officials and Iranian state media, and the Trump administration says it is investigating who was responsible.

Smoke above Tehran, via EPA

Some of the most important latest developments at the Pentagon as well as CENTCOM headquarters come from fresh reporting in Politico:

Trump administration is scrambling to manage the fallout of the Iran war: The Pentagon is requesting additional intelligence officers for at least 100 days, suggesting the war could last far longer than the initially suggested four-week timeline. Officials say planning was limited. There’s talk of “through September.”

A State Department source said “too few people were read in on the war plans,” which slowed evacuation preparations and travel alerts for Americans in the region.

Critics say the response looked improvised, with one former U.S. diplomat calling it “a completely ad hoc operation… like they woke up on Saturday and decided to start a war.”

Again, if the Pentagon is requesting additional intelligence officers for at least 100 days, this strongly suggests the war could last far longer than the initially suggested four-week timeline. Hegseth has already suggested up to eight weeks, and the scope and timeline keeps sliding further.

In Iran, Foreign Minister Abbas Araghchi warned of “terrorist movements” along Iran’s border with Iraq and called for stronger security measures amid reports that the United States is in talks with Kurdish forces about arming them to foment an uprising against Tehran.

Israel hit hard overnight:

Some Kurdish groups are already ‘preemptively’ getting hit, with Iran’s Intelligence Ministry announcing its forces launched operations against Kurdish groups based in the semi-autonomous Kurdish region of Iraq. The ministry said it struck positions belonging to “separatist groups” attempting to cross Iran’s western border and reported that they suffered heavy losses.

The statement, carried by state media, said Iranian forces are cooperating with “noble Kurds” to thwart what it described as an “Israeli-American” plan to attack Iranian soil. This after many Western pundits have questioned the purpose of government officials airing or ‘leaking’ supposedly covert plans for the CIA and Mossad to arm Iranian Kurdish separatists. Still, the NY Times is freshly reporting Thursday:

Pro-American, Iranian Kurdish forces based in Iraq are preparing armed units that could enter Iran, creating a potential new front in an already expanding conflict.

Meanwhile, Israel expanded its air campaign inside Iran. In a new wave of strikes around Tehran, the Israel Defense Forces said it hit the headquarters of Iran’s special forces, bases of the Basij paramilitary organization, and other government-linked sites – amid official claims the US and Israel are trying to ‘liberate’ and get the Iranian people to ‘rise up’. About 90 Israeli Air Force fighter jets participated in the operation, striking roughly 40 targets with about 200 bombs, according to the military.

Iranian authorities say civilian infrastructure has also been hit and have charged that more schools are getting obliterated. Missiles fired by the US and Israel struck two schools in the town of Parand, southwest of Tehran, Iran’s semiofficial Fars news agency is alleging. Images which were widely circulated showed debris and destruction inside what appeared to be a classroom, while several nearby residential buildings also sustained damage.

Tehran has decried European apathy as its cities get pummeled, with Iran’s Foreign Ministry spokesman Esmaeil Baghaei warning that European Union countries will “pay the price, sooner or later” if they remain silent over the US-Israeli attacks. Earlier in the week a few drones were sent against EU-member Cyprus, targeting a British airbase there.

Iran has upped its retaliatory strikes against Israel in another huge assault, launching its 19th wave of missile and drone attacks targeting Israel and US assets across the Middle East. The videos coming out of Tel Aviv overnight were surreal, showing dozens of ballistic missiles soaring above – often evading Israel’s air defenses – before hitting targets and erupting in huge fireballs. Damage on the ground also confirms that many missiles continue to get through, with Israel’s military appearing to conceal the extent of destruction – and possibly even casualties. Reuters reports Thursday:

Iran’s Revolutionary Guards have tightened their grip on wartime decision making despite the loss of top commanders, senior sources say, driving a hardline strategy that is propelling Tehran’s drone and missile campaign across the region.

The IRGC said it fired ballistic missiles carrying one-ton explosive warheads at Tel Aviv’s Ben Gurion Airport. One projectile landed in Bareket, east of Tel Aviv. Millions of residents across central Israel were sent into shelters overnight as missile intercepts triggered explosions that rattled buildings across the area. However, medics reported no injuries following the latest barrage. Official military assessments say that only a small number of missiles were launched and no impacts were recorded in residential neighborhoods. 

While Iran military commander Amir Heydari told state TV on Thursday the vital Strait of Hormuz isn’t closed, traders and analysts still expect it will take weeks before oil flows can resume meaningfully.

Reuters and other have asked: how deep is Iran’s missile and drone arsenal (as similar questions are being asked of Pentagon stocks): 

Iranian drone attacks could disrupt the Strait of Hormuz for months, but how long the Islamic Republic could sustain its missile barrage is less clear, according to intelligence sources and military analysts.

The Iranians are claiming to have only tapped their older stockpiles and that they’ve barely started using the shinier, high-tech and most devastating missiles. As for the ongoing Iranian attacks on US Gulf allies, Iran’s military said Thursday it carried out a drone attack on a US military site in Kuwait. Other countries have reported ongoing drone or missile activity, as well as projectiles still targeting oil and logistical sites.

But most importantly, the conflict has come to Azerbaijan for the first time. Iranian drone strikes injured two people and damaged the terminal building of an airport near the Iran-Azerbaijan border – which marks the first such attack on Azerbaijani territory since the war began. The drones reportedly struck the exclave of Nakhchivan, which lies between Armenia and Iran, with another drone reportedly falling near a school in Shakarabad. “We strongly condemn these drone attacks launched from the territory of the Islamic Republic of Iran,” Azerbaijan’s foreign ministry said.

At sea, Iran’s foreign minister condemned a US torpedo strike that sank the Iranian warship IRIS Dena off the coast of Sri Lanka on Wednesday, calling it an “atrocity” and warning that Washington will come to regret the attack. More than 80 people were killed and several remain missing after the vessel sank. The event is under international scrutiny as some Western officials and pundits have stated that according to the Geneva Convention, the US Navy was obligated to search for and rescue sinking Iranian seamen in so far as possible – but that doesn’t appear to have happened.

The fighting continues to global energy markets, particularly given cargo vessels are avoiding the Strait of Hormuz after the IRGC announced the closure of the vital shipping route, throttling oil and gas flows – though we reported overnight on an apparently China-owned bulk carrier being able to make it through.

Iran itself remains under a severe communications blackout, with Internet connectivity across the country at roughly 1% of normal levels for more than 120 hours, according NetBlocks. Iranian authorities are reportedly messaging citizens warning they better not protest at this emergency moment when the country is under attack.

The war also continues to spread in Lebanon, where Israel and Hezbollah have been in a ground war for some 24 hours, amid reports of the IDF sending tanks. Since fighting resumed earlier this week, at least 77 people have been killed and 527 wounded, according to Lebanon’s health ministry.

The widening war has further stranded tens of thousands of travelers across the region. Roughly 23,000 foreign nationals remain stuck in Middle Eastern countries as commercial flights are disrupted. Several governments – including the United Kingdom, India, France, Germany, Italy, Japan, Australia, and the Czech Republic – are organizing additional flights and safe border crossings to evacuate their citizens. The Trump administration came under fire initially, but has since confirmed it is organizing evacuation flights and other methods for stranded American citizens in the region.

At the same time Western officials say the military campaign is still escalating, with senior US officials warning that American strikes will begin targeting deeper locations inside Iran and emphasized that the operation remains in its early stages. This means ongoing heavy long-range bomber raids by the US.

France has also allowed US non-combat aircraft to use an airbase on French territory, with what a French Armed Forces spokesperson described as the “complete guarantee” that the planes “do not participate in any way in US operations in Iran” and are used only to defend regional partners. Italy announced it will send air-defense support to Gulf countries struck by Iranian retaliatory attacks, according to Prime Minister Giorgia Meloni.

This question of whether US allies will jump in remains an open one. Prior precedents of American Middle East adventurism suggests it’s only a matter of time, and we are seeing the proverbial camel’s nose under the tent. Another excample: Canadian Prime Minister Mark Carney said he “can never categorically rule out participation” in the US-Israeli war with Iran after previously saying Canada would not take part.

Meanwhile, European Union foreign policy chief Kaja Kallas urged diplomacy to prevent further escalation. “There has to be room for diplomacy here to really get out of this cycle of escalation, she said, adding that “it’s clear wars really end in diplomacy.” Kallas said Gulf governments are increasingly “worried about civil war inside Iran” and the consequences that could ripple across the wider region. “Nobody can tell how it will really go, but the risks are clearly there,” she said. On this front Tehran and Washington do not appear to be engaged – not even indirectly:

Iran’s Deputy Foreign Minister said Iran is ready to abandon its nuclear program on the condition that the US presents a rewarding alternative offer, Sky News Arabia reported; adds no message was sent to the US to end the conflict. Focused on self defense efforts.

At the White House the war justifications have seemed to change daily. Even a key objective of full regime change appears to have been dropped from the official US list of objectives – perhaps on the realization that it would require major boots on the ground.

Still, looming large over this is the potential for a WW3-style whole regional and global confrontation to erupt, in the unlikely scenario that Russia or China gets directly involved. After all, the conflict has already brushed against NATO territory. Turkish air defenses intercepted what Ankara said was a missile launched from Iran on Wednesday; however, Iranian military leaders denied firing any missile toward Turkey. The interception marked the first – and highly dangerous – time NATO forces have shot down an Iranian missile heading toward a member state during the conflict.

Tyler Durden
Thu, 03/05/2026 – 23:30

The Spell Of Woke Is Broke: Let’s Keep It That Way

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The Spell Of Woke Is Broke: Let’s Keep It That Way

Authored by Thomas F. Powers via American Greatness,

It is too early to know with any precision what the long-term effects of the Trump administration’s anti-DEI efforts will be. We might take our bearings on that score by considering the fate of essays written by prominent law professors in the 1950s and 1960s touting this or that discrete step in the unfolding of the civil rights revolution—the latest Supreme Court decision, and so on—as if each were an all-or-nothing earth-shattering decision.

What we can now say with certainty is that what the Trump administration has done on the DEI front represents the beginning of a general reorientation of our politics away from wokeness. One need only survey what prominent leaders of the Left are saying about the political price the Democratic Party has paid on that score. What they are saying indicates a large political change, even if the Dems prove incapable of unmooring themselves from woke politics for the near future.

The first sign of this reorientation is a general shift in the popular mindset: the spell of woke politics has broken. This matters because it was always the way in which woke politics commanded assent in the citizens’ hearts and minds that was crucial. That assent has been questioned or denied now in a broad way, with the backing of public authority (Supreme Court decisions, executive orders, agency directives), and with widespread public support. Wokeness’s public hectoring, punitiveness, and censoriousness, and the extremism of many of its positions on the issues, is unpopular at the level of 70–30 or 80–20 opinion poll divides.

We ought to be confident, therefore, that the broken spell of wokeness augurs a permanent shift in our public life. What that means precisely, however, depends very much on how we understand wokeness and what is done going forward to ensure that woke excess does not return. Now, if, as many say, wokeness was the product of cultural Marxism (Christopher Rufo and a host of followers) or postmodernism (Jordan Peterson and another host of followers), then all that needs to be done is to combat bad ideas. On these interpretations, our universities in particular, and other cultural institutions where the influence of such ideas holds sway, need our attention. Certainly, cultural Marxism and postmodernism represent bad ideas, and the world would be a better place without their influence.

But if what wokeness represents above all is the explosive power of the civil rights revolution and the influence of an aggressive leftist interpretation of anti-discrimination politics, as another band of interpreters claims (I among them), then the task ahead is much bigger and much more difficult.

Trump’s anti-DEI measures, on this view, would represent only the first step in a broader campaign of civil rights reform. One could look long and hard without seeing much in the way of evidence for any such thing so far. Are these current efforts against DEI an illusion, a brief moment of political opportunism that will recede as public hatred of wokeness recedes—only to return in a few years when the next wave of anti-discriminatory passion rises up?

I don’t think that worry is justified. The anti-DEI campaign to date will have enduring consequences because even if it is not yet clear that what is at stake in DEI is civil rights politics, the current reorientation can only have the effect of raising our awareness of the role of anti-discrimination in our public life. This has begun on the all-important moral plane of civil rights politics. Precisely by breaking the spell of its puritanical commands, our anti-woke moment is reworking something essential to civil rights politics. Because public morality is the crucial filter of the human mind, a shift at this level will change what we see, what we think, and what we think we can say. Anti-woke sentiment, backed by changes in the law, is providing a moment of political, cultural, and mental freedom that will necessarily lead, after many decades during which this was not possible, to a general reappraisal of the moral power and the meaning of the civil rights revolution.

Morality, the Problematic Core of Anti-Discrimination Politics

The civil rights regime was always a collection of disparate, crucial elements. anti-discrimination politics began with the discrete groups who claim its protections (by now an overwhelming majority of the population), but it has been bolstered by laws and institutions and by a set of supporting “ideas” (critical race theory, postmodernist “difference” theory, critiques of “prejudice” by sociologists and anthropologists in the early twentieth century, e.g.). Its modes and orders have been advanced further in a hundred independent corollary efforts of cultural change throughout modern life (in the professions and in the domains of art, literature, and the like).

But central to the whole has always been the moral claim of the fight against discrimination. That moral claim has always been essential to civil rights politics and explains its great power in modern life.

Morality is crucial to anti-discrimination for a very simple reason: our perception of “discrimination” is a perception of an injustice. Indeed, what we mean politically by “discrimination” is always “unjust discrimination.” All human beings discriminate among classes of things, conceiving of better and worse, all the time; whenever we say “that’s discrimination” in a political sense, however, what we always have in mind is some kind of unfair or unmerited discrimination or negative judgment.

At the very beginning of anti-discrimination, we of course confront a form of unfair or unjust discrimination against blacks in America that any fair-minded person can very easily see was outrageous. Any decent person will say that an individual ought to be judged by the content of his character, not by the color of his skin. Anti-black discrimination in America was also extremely harsh and harmful, entailing a wide array of harms, ranging from minor indignities all the way up to violence and homicide. Americans were powerfully reminded of the profound injustice of American racism at the moment of their great moral triumph over Hitler and Nazism, which revealed the full scale of the horror of the Holocaust.

The moral power of civil rights politics played a decisive role in the 1950s and 1960s when the anti-discrimination regime was launched. It is true that the American liberal democratic tradition had long expressed a certain wariness of moral crusades (like Prohibition or, before that, religious puritanism). Only a moral force of immense power, of the sort the civil rights revolution was, could overcome our hesitations along those lines. The only real parallel to the civil rights effort was the attempt a century earlier to deal with American race discrimination’s father, or grandfather, slavery, in the Civil War, the bloodiest war in American history.

Victims of discrimination now carried a moral claim that could be used to demand attention from others. This moral starting point was supercharged and made hyper-spirited because, not entirely by conscious design, anti-discrimination enforcement came to institutionalize a hybrid of the civil law and criminal law. Policing harassment and discrimination borrows from the spirit of the criminal law at crucial points (naming offenders and victims, enlisting government prosecutors, paying close attention to intent and “motive”) but with the legal instrumentalities of tort law (looser procedures with lower standards of protection for the accused).

One consequence of this hybrid quasi-public, quasi-private legal structure was that enforcement of the machine could be handed over to employers, educational establishments, and other large (private or public) institutional entities acting in their capacity as “employers.” Enforcement was then implemented by our fellow citizens, acting under a sanction that was rooted in the law but not evidently or obviously “official” or governmental. The overall result was that anti-discrimination enforcement became a way of policing in an effective and relatively intimate way a significant portion of our social interactions, interpersonal behavior, and private speech—and policing how people treat one another is very much a matter of basic morality.

It was into this social domain that civil rights law, invited in by all-too-willing fellow citizens (bosses, deans, HR managers), imported the punitive and blame-casting spirit of the criminal law. At least as important, these individuals wielded the crucial coercive “corrective measure” of this privatized enforcement regime, above all, the firing of individuals. Punishment thus completes the picture for anything in the ballpark of “harassment”—and also for actions like demonstrating recalcitrance to the demands of the new order.

A New Morality?

As important as the victim/perpetrator injustice claims have been to the moral hold of civil rights politics, the morality of the anti-discrimination revolution is more complicated than that; moreover, its various claims are stated in much more precise terms. Indeed, a whole new system of public morality emerged out of the civil rights revolution.

To elaborate on this in detail would take more space than I have here, but in brief, a new terminology has emerged to clarify the harm of discrimination and to articulate the steps that must be taken to eradicate it. “Identity” is a vitally important term today because it names with some precision what it is in the individual that is threatened by group-on-group discrimination. “Respect” must replace mere “toleration” as a standard of interpersonal treatment because toleration is consistent with some kinds of discrimination (especially discrimination in the private sector). Claims from both identity and respect show that civil rights politics is thus necessarily a politics of “recognition.” New schemes of representation come into view as necessary as well—new, more “inclusive” schemes that reflect the “voices” of those previously excluded by discrimination. And, last but certainly not least, a host of new equality claims—systemic, structural, societal—call into question noticeable inequalities affecting the groups protected under anti-discrimination law. Such claims are now advanced under the heading of “equity.”

A whole new civic morality has thus emerged out of the political upheaval of the civil rights revolution; shamefully, our political scientists have nothing to say about this massive and astonishing fact of our public life.

It is the morality of civil rights as interpreted by the Left that supplies the key “ideas” that are at the core of the woke outlook—and not, I would insist, cultural Marxism or postmodernism or cultural relativism, and so on. To be sure, “ideas” there are here aplenty—identity, inclusion, recognition, respect, equity, etc.—but they are all ideas with a very simple and clear political origin. The lesson for us here ought to be this: political history as the cause of ideas, not intellectual history as the cause of politics.

One additional step remains: it is above all the moral logic of civil rights politics that must be “taught,” as a semi-official catechism, by way of the public and private enforcers of the regime, through things like diversity training, Title IX training, anti-bullying training, and the like—and with punitive sanctions for those who do not want to go along.

The moral power of the anti-discrimination revolution helps to explain how it could grow and grow, more or less unchecked, to the point where it became the monstrous woke regime against which the people have finally rebelled. This explains, too, why the American Left thought for so long that the Democratic Party could ride an anti-discrimination coalition to enduring political victory. Because of its moral content, the anti-discrimination regime—its groups, its laws, its ideas, its institutions, public and private—all seemed unquestionable, simply above criticism.

Our Doubts About the New Morality

What is crucial about the current moment is that anti-DEI sentiment extends to a new wariness concerning precisely the moralism of wokeness. Americans are heirs of the Enlightenment and heirs of liberal democratic constitutional government, and they have not entirely forgotten the suspicion of any politics that claims too much in the name of high and lofty ideals, religious or secular.

It’s true that almost no one is saying publicly that anti-wokeness is really at bottom opposition to civil rights moralism. But one need only consider in rough outline what it is that public anti-woke ire expresses in order to see why that is the case.

We don’t see this, however, and that is because the great moral power of civil rights still does its work to halt us from facing the enormous consequences of the social-political revolution that has taken place in its name. This is something that we see today, even in the Trump administration’s very effective anti-DEI measures. This is a huge effort of civil rights reform, in fact, unprecedented in its sweep. But does anyone call it by that name?

What is needed is a fuller and franker facing of the hold the civil rights revolution has on us. The greatest obstacle to that is its moral hold. How, then, to start to challenge—or at least to begin to think clearly about—something as important to American life as the morality of anti-discrimination without going off the deep end into a world that would welcome back discrimination of the kind American blacks endured before the 1960s. That is a price we cannot pay.

One answer is to begin to look at, to see, the civil rights revolution in its many conflicts with another morality that has great power in America—namely, the morality of the liberal democratic constitutional tradition. And when one begins to look on that level, there are indeed many, many conflicts between the logic of anti-discrimination and that older moral-political outlook.

Looking at anti-discrimination (as a whole) from the perspective of liberalism (as a whole), we will perhaps be able to begin, finally, to see the anti-discrimination regime as a distinct entity. We will, at the same time, be unable not to notice the many lines of tension between these twin poles of our moral-political order. That ought to free us up to start thinking more clearly about the relationship between them. Questioning one’s civic morality is not something to be embraced lightly, but fortunately for us in this situation, questioning one set of our moral categories may be done with a view to another, healthier, set.

* * *

Thomas F. Powers is Visiting Lecturer at The Center for Civics, Culture, and Society at Cleveland State University and author of American Multiculturalism and the Anti-Discrimination Regime (St. Augustine’s Press).

Tyler Durden
Thu, 03/05/2026 – 12:50

Israel Targets Iran’s Protest-Crackdown Forces With New Airstrikes

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Israel Targets Iran’s Protest-Crackdown Forces With New Airstrikes

Israel is striking Iran’s internal security apparatus in an effort to weaken the regime’s ability to suppress dissent and potentially open the door to a popular uprising, according to the Wall Street Journal.

Israeli airstrikes on Wednesday targeted figures and facilities tied to domestic repression, including members of the Basij paramilitary and senior intelligence officials, the Israeli military said. Israel and the U.S. have also hit internal-security institutions such as the Tehran headquarters of the Islamic Revolutionary Guard Corps (IRGC), which plays a central role in protecting the regime.

The IRGC and Basij led the violent crackdown on antigovernment protests in January, when security forces fired on demonstrators and killed thousands. Police and intelligence agencies also detained large numbers of protesters.

Israeli officials say the goal is to weaken Iran’s coercive apparatus from the air so citizens can challenge the government on the ground. Analysts caution that airpower alone may not bring down the regime.

“If the bet is that airstrikes will finish the job from above while Iranians complete it from below, it’s a bet that rests on no clear historical model,” said Ali Vaez of the International Crisis Group. “It also ignores the resilience of entrenched authoritarian systems like the Islamic Republic.”

The Wall Street Journal writes that recent strikes targeted dozens of internal security facilities, including the IRGC’s Tharallah headquarters, which coordinates intelligence, policing and Basij units during unrest. Israeli jets also hit the police special-units command, Faraja, responsible for riot control. Iran later confirmed the death of Faraja intelligence chief Golamreza Rezaian.

“These bodies were responsible for, among other things, suppressing protests against the regime through violent measures and civilian arrests,” the Israeli military said.

Joint U.S.-Israeli operations have also focused on western Iran’s Kurdish regions, long known as opposition strongholds. Rights groups reported strikes on police and detention sites in the Kurdish city of Sanandaj.

The conflict comes amid growing unrest inside Iran driven by economic hardship, political grievances and anger over the January killings. More than 7,000 people have died in the unrest, according to Human Rights Activists in Iran.

Still, the government retains a near monopoly on weapons across most of the country, and Basij patrols continue. Civilian casualties from the conflict—over 1,000 so far, including 180 children—could also strengthen hardline support for the regime.

Former President Donald Trump has urged Iranian security forces to defect. “I urge the IRGC, Iranian military, police to lay down your arms and receive full immunity or face certain death,” he said Sunday. “It will be certain death.”

Tyler Durden
Thu, 03/05/2026 – 11:40

Futs Jump On Reports About Iran’s Willingness To Give Up Uranium Stockpile

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Futs Jump On Reports About Iran’s Willingness To Give Up Uranium Stockpile

U.S. equity futures jumped around 4:00 a.m. ET after Bloomberg News reported that Iran had previously signaled a willingness to surrender its highly enriched uranium stockpiles in high-stakes negotiations, just before the U.S. launched Operation Epic Fury.

Although the Bloomberg story relates to last week’s U.S.-Iran developments, the market is extremely sensitive to headlines – even old ones – and that was enough to send S&P 500 E-mini futures surging, erasing earlier losses and now flat. Nasdaq futures are also little changed.

Main U.S. equity futures indexes

Here’s what Bloomberg reported:

Iran told the U.S. in recent nuclear negotiations that its stockpile of highly enriched uranium “is the result of our practical achievements and that we are ready to get rid of it, provided we get something good in return,” the state-run Islamic Republic News Agency cited Deputy Foreign Minister Majid Takht-Ravanchi as saying.

Bear in mind this news is ‘old’ (we reported on Friday), but for it to repeated no in public is very different from saying it in private a week ago…

Absolutely huge late Friday developing news, if it’s confirmed and assuming it sticks, via CBS: “Iran has agreed to give up its stockpile of enriched material – zero accumulation – and allow for full verification by the IAEA of its nuclear program according to US-Iran talks mediator, Oman’s foreign minister Badr al Busaidi.”

The Iranian side also seems to be confirming its willingness to make this significant concession, also to stave off a massive US attack, given the immense build-up of Pentagon assets in the region. According to more breaking details via CBS:

Negotiators from the U.S. and Iran have made “substantial progress” toward a deal to curb Iran’s nuclear program, Omani Foreign Minister Badr Albusaidi told CBS News on Friday, as President Trump considers strikes on Iran.

Albusaidi — who has mediated several rounds of U.S.-Iran talks over the last month — told “Face the Nation” moderator Margaret Brennan that a “peace deal is within our reach.”

He said Iran has agreed that it will “never, ever have … nuclear material that will create a bomb,” which he called a “big achievement.” The country’s existing stockpiles of enriched uranium would be “blended to the lowest level possible” and “converted into fuel, and that fuel will be irreversible,” according to Albusaidi.

Why this old news is being recirculated remains unclear.

Last week:

On Wednesday, CNN reported that Iranian intel officials had sent word to Washington about potential talks to end the conflict, yet no U.S. official has publicly confirmed that any negotiations are underway.

Interestingly while stocks jumped on the ‘hope’, Polymarket odds a ceasefire by month-end slipped to just 1 in 4…

Iran potentially surrendering its uranium stockpiles may become the new “trade war” headlines for the stock market casino. We all remember those headlines from one year ago and in Trump’s first term. 

Tyler Durden
Thu, 03/05/2026 – 07:41

Anthropic In Chaos: CEO Tries To Salvage Pentagon Contract After Slamming Trump, Altman In Leaked Letter

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Anthropic In Chaos: CEO Tries To Salvage Pentagon Contract After Slamming Trump, Altman In Leaked Letter

Things over at Anthropic are getting wild.

On Friday, the Trump administration ‘fired’ the woke serial copyright infringer, industry disruptor and software-engineer-extinctor after a bruising dispute with the Pentagon came to a head over ethical concerns surrounding Claude’s military use – specifically, domestic surveillance and fully autonomous weapons. The Pentagon demanded to use ClaudeAI for “any lawful purpose” with no guardrails – or having to ask permission from a bunch of blue-haired Karens in a life-or-death scenario. The chatbot’s supposedly idealistic leader (whose sister and Anthropic co-founder, Daniella Amodei, is married to Holden Karnofsky, the founder of Effective Altruism himself) had to signal virtuemaxx to his employees, and said no. OpenAi’s Sam Altman, who is a different kinds of opportunistic sociopath with zero moral qualms, pretended to side with Amodei at first only to immediately swoop in and poach Anthropic’s Pentagon contract. Meanwhile, Amodei’s investors, who had just dumped all their cocaine cash for the next 20 years into his company at a $380 billion valuation, and realized they would never see their money again if the government blacklisted and banned the company from all government supply chains, were terribly vexxed. 

The spat resulted in three things; first, in addition to getting ‘fired,’ Anthropic was deemed a “supply-chain risk” (making them radioactive to the defense industry) – and federal agencies were given six months to ditch Anthropic products. Second, OpenAI’s Sam Altman slid into Hegseth’s DMs (through proper channels, we’re sure) and landed Anthropic’s contract – which they revised to beef up and clarify safety protocols, and third, Anthropic CEO Dario Amodei threw a ripper of a tantrum in a leaked memo sent to over 2,000 employees attacking the Trump administration and OpenAI. 

For Silicon Valley investors and allies, it immediately sank in how absolutely fucked they are if this stands. Now in a PR crisis, Amodei is scrambling to salvage his company’s relationship with the Pentagon (read: the goodwill of his investors) – and has begun last-ditch talks with senior officials in hopes of striking a new deal, FT reports, adding that he’s now personally negotiating with Emil Michael, the Pentagon’s undersecretary of defense for research and engineering, who on Thursday called Amodei as a “liar” with a “God complex after talks with the Pentagon collapsed. 

Pentagon Showdown

Anthropic drew several red lines against allowing its technology to power fully autonomous lethal weapons or mass domestic surveillance, arguing that the level of protections the Pentagon wanted would be ineffective, and that the Defense Department’s language was suspicious.

“Near the end of the negotiation the department offered to accept our current terms if we deleted a specific phrase about ‘analysis of bulk acquired data,’” Amodei wrote in a memo to employees. “That was the single line in the contract that exactly matched the scenario we were most worried about. We found that very suspicious.”

Pentagon officials, meanwhile, claim that Anthropic was demanding they ask permission in life-or-death nuclear scenarios, which Anthropic denied.

A defense official said the Pentagon’s technology chief whittled the debate down to a life-and-death nuclear scenario at a meeting last month: If an intercontinental ballistic missile was launched at the United States, could the military use Anthropic’s Claude AI system to help shoot it down?

It’s the kind of situation where technological might and speed could be critical to detection and counterstrike, with the time to make a decision measured in minutes and seconds. Anthropic chief executive Dario Amodei’s answer rankled the Pentagon, according to the official, who characterized the CEO’s reply as: You could call us and we’d work it out.

An Anthropic spokesperson denied Amodei gave that response, calling the account “patently false,” and saying the company has agreed to allow Claude to be used for missile defense. But officials have cited this and another incident involving Claude’s use in the capture of Venezuelan leader Nicolás Maduro as flashpoints in a spiraling standoff between the company and the Pentagon in recent days. The meeting was previously reported by Semafor. –Washington Post

Does the last-ditch effort to save things mean that Anthropic is going to budge on their red lines – perhaps matching whatever OpenAI has stipulated or agreed to?

Memo Meltdown

After OpenAI snaked their contract, Amodei dismissed the rival’s safeguards as little more than “20% real and 80% safety theater,” – claiming that OpenAI’s Pentagon deal appears to rely on “safety layers” and monitoring systems intended to block prohibited uses – safeguards he says are easily bypassed.

“Refusals aren’t reliable and jailbreaks are common,” he wrote, adding that AI models cannot reliably determine whether they are being used for surveillance or autonomous weapons because they lack visibility into the real-world context of how their outputs are used.

Amodei also blasted the idea that contractors such as Palantir could enforce restrictions through software filters.

“Our sense was that it was almost entirely safety theater,” he wrote, claiming such tools were designed mainly to placate concerned employees rather than actually prevent abuses.

‘We Haven’t Given Dictator-Style Praise To Trump’

Amodei argued that the real reason the Trump administration is targeting Anthropic has nothing to do with technology or national security.

“The real reasons the DoW and the Trump admin do not like us is that we haven’t donated to Trump… we haven’t given dictator-style praise to Trump… and we have supported AI regulation,” he wrote.

Amodei claimed OpenAI leadership – including president Greg Brockman – had donated heavily to pro-Trump political groups while Anthropic refused to play the same game.

He also accused the Pentagon of coordinating messaging with OpenAI to portray Anthropic as unreasonable in contract negotiations.

“Sam is trying to make it more possible for the admin to punish us by undercutting our public support,” Amodei wrote.

Which, again, begs the question of whether or not Anthropic is now willing to budge on their red lines.

Investors Alarmed

Needless to say, Anthropic’s investors and partners are freaked out – with backers including Amazon, Nvidia, Lightspeed Venture Partners and Iconiq Capital scrambling to hold urgent talks with the company in recent days as they attempt to defuse the conflict with Washington.

A major technology industry group representing many of these companies sent a letter to the Hegseth Wednesday warning against the Pentagon labeling any AI provider a supply-chain risk amid a procurement dispute.

But what really matters are Anthropic’s investors – both current but especially future (after all someone has to fund those billions in perpetual losses)  – many of whom blame Amodei’s confrontational approach for escalating the situation.

“It’s an ego and diplomacy problem,” one person familiar with the talks told Reuters.

Some investors have reportedly reached out to contacts inside the Trump administration in hopes of calming tensions.

Following Trump and Hegseth’s Friday announcement, several agencies began shifting away from the company. The State Department has reportedly moved to OpenAI following an order from the White House to phase out Anthropic systems within six months.

Meanwhile, Anthropic has raised tens of billions of dollars and is widely expected to pursue a public offering. Enterprise customers account for roughly 80% of the company’s revenue, and its projected annual run rate has reportedly surged from about $14 billion to $19 billion in recent weeks (and do we believe this?).

Tyler Durden
Thu, 03/05/2026 – 07:30

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