As questions hang over who will ultimately succeed Iran’s slain supreme leader Ayatollah Ali Khamenei, an interim leader has been appointed to fulfill his duties. Top Shia cleric Alireza Arafi has been named to the interim Leadership Council after Supreme Leader Khamenei was confirmed killed in US-Israeli strikes, state media reported Sunday.

The ISNA news agency has described that Arafi, a member of the Guardian Council, is joining President Masoud Pezeshkian and Chief Justice Gholamhossein Mohseni Ejei on the body tasked with carrying out the supreme leader’s responsibilities until the Assembly of Experts appoints a permanent successor. All of this happening as US-Israeli bombs continue to fall on Tehran and other sites for a second straight day, ‘uninterrupted’ – as President Trump pledged Saturday.

Born in 1959, 67-year-old Alireza Arafi ranks among the most powerful clerics in Iran. Before his emergency elevation, he held three key posts: director of the nationwide Islamic Seminary system, member of the Guardian Council, and member of the Assembly of Experts.

While rooted in Qom’s clerical establishment, Arafi combines traditional religious authority with seeking to carefully modernize Iran; however his appointment of course signals continuity, and he’ll be tasked with seeking to ensure regime survival – which is what this moment is all about for Tehran. Most importantly, Arafi is viewed by the IRGC and political leadership as a loyal insider who will preserve a retaliatory trajectory during wartime.

Heavy US and Israeli bombing has been observed Sunday on the Iranian capital, particularly on known government and military command centers, but that hasn’t stopped large gatherings of mourners in other parts of the country.

While there’s been evidence of local celebrations in some sectors among anti-government Iranians, Sunday footage on state TV and other international media shows loyalists in possibly the hundreds of thousands showing solidarity with the slain Ayatollah the Islamic Republic leadership.

Mourners gathered at Tehran’s Enghelab Square to honour Supreme Leader Ali Khamenei, who was killed on Saturday after the US and Israel launched massive strikes on the capital.

Iran’s president branded the US-Israeli killing of Khamenei a “declaration of war against Muslims” pic.twitter.com/F7T8NDq1rg

— Middle East Eye (@MiddleEastEye) March 1, 2026

President Masoud Pezeshkian condemned the killing as “a great crime” and has declared seven days of public holidays in addition to the 40-day mourning period. Outraged and saddened Iranians were seen pouring into the streets of the capital soon after state TV finally made the announcement confirming Khamenei’s killing during the opening salvo of the US-Israeli attack. Iranian authorities have alleged major war crimes, including the deaths of over 85 young girls attending school when a bomb struck.

“There will be expected ceremonies,” Pezeshkian said, while noting they will have to happen even while the bombardment continues across the country. He’s also said his country views revenge as its “legitimate right and duty” after Khamenei had been murdered by the “most wicked villains in the world.”

The president further claimed the act was a “declaration of open war on Muslims, especially Shiites, in all corners of the world.” According to NBC:

The government in Iran is under attack like never before. Today tens of thousands of regime supporters packed into Tehran’s Revolution Square to mourn the late Supreme Leader Ayatollah Ali Khamenei, who was killed in a joint U.S. and Israel military operation.

They chanted “God is great!” while officials promised revenge. One said Iran would deliver “terrifying blows” to make the U.S. and Israel beg for mercy.

Iran’s interim leadership council: President Masoud Pezeshkian, Head of Judiciary Gholam-Hossein Mohseni-Ejei, and member of the Guardian Council and Assembly of Experts Ayatollah Ali Arafi. 

As for the day to day running of the country and immediately overseeing the military response, Ali Larijani is believed to be in the driver’s seat. Khamenei had reportedly personally tapped Larijani – a former Revolutionary Guards (IRGC) commander and political heavyweight – to take charge in the event of the Supreme Leader’s death.

Israel has confirmed it has conducted new strikes “in the heart of Tehran” and that the “majority” or Iran’s senior military leaders – some 40 of them – were killed in the opening wave. “The Israeli Air Force continues to operate extensively in both defense and offense, with the goal of removing threats posed to the State of Israel,” the IDF said – alongside the US boasting that they have established air superiority with much of Iran’s radars and air defenses having been taken out already.

Iran has said that at least 200 of its people have been killed, but the actual figure could be much higher, and is expected to be in the coming days. The external attack could go on for weeks, given especially President Trump is now calling for full regime change, which would mean defeating and dismantling the Islamic Revolutionary Guard Corps (IRGC). The problem with this is that most analyst agree it would require boots on the ground. Trump says he wants to see full “freedom” in Iran as the goal of the military operation.

Trump’s ‘shock & awe’: Tehran is a densely packed modern cosmopolitan city of almost 10 million people. The wider metropolitan area has over 16 million.

“This is a picture of Tehran. For you uneducated, untraveled, never-served, warhawks licking your chops at the thought of bombing it. It’s not some low population desert. There are families, children, family pets. Regular working class people with dreams. You’re sick to want war” pic.twitter.com/I60eoHpgON

— Mohamad Safa (@mhdksafa) February 28, 2026

Massive airstrikes on Tehran:

⚡️Massive airstrikes on Tehran pic.twitter.com/kIB4OU3SDM

— War Monitor (@WarMonitors) March 1, 2026

So far, it’s been limited to an air war, and with naval assets also firing, and no casualties on the US or Israeli sides have yet to be reported. It’s mainly America’s Gulf allies which have suffered, with Iranian ballistic missiles coming down on US bases in the region – but also strikes which have landed on hotels, buildings, and even major airports around the Gulf.

By all accounts Israel has been getting hit hard – though many analysts say Israel’s military censor is working in overdrive, preventing an avalanche of information from getting out. However, there’s still plenty of confirmation of some Iranian ballistic missile impacts:

⚡️From site of Iranian missile impact in central Israel pic.twitter.com/nCrkWUOuP1

— War Monitor (@WarMonitors) March 1, 2026

Air alert sirens continue sounding especially across central Israel. Tel Aviv was struck overnight:

This war looks to go on, even if there’s desire in the White House for it to be ‘one and done’ – as increasingly the Iranians have nothing to lose. One likely result of the unprovoked US-Israeli attack is that leadership in Tehran will only become more hardline. We detailed some of the initial Saturday blowback on the Gulf allies – but Sunday has witnessed some direct repercussions on US embassies and diplomatic compounds in the region. 

The US Consulates General in Karachi and Lahore has come under attack by large angry mobs, within hours after Khamenei’s death was announced. “Violent clashes between protesters and security forces in the Pakistani port city of Karachi left at least nine people killed and more than 50 others wounded on Sunday, after hundreds of demonstrators attempted to storm the U.S. Consulate, authorities said,” according to AP.

Anger is boiling over in Pakistan, as protesters storm and burn the US consulate in Karachi. Pakistan is the home to the world’s second largest Shia population in the world. The killing of Khamenei will have repercussions for the US. pic.twitter.com/lg9ch8mxp1

— Glenn Diesen (@Glenn_Diesen) March 1, 2026

Things are also popping off outside high-secured Baghdad’s Green Zone, where Iraqis are trying to breach the US embassy, with hundreds seen rioting and even bringing bulldozing equipment to the site. The mob threw stones and clashed with Iraqi security forces, which responded with tear gas. “Their attempts had been thwarted so far, but they keep trying,” an official told AFP. Iraq is a Shia majority country with heavy loyalty to the Shia religious establishment in Iran. Baghdad’s general pro-Iran stance and influence is a legacy of the Bush Neocons, who overthrow Sunni secular Baath dictator Saddam Hussein and elevated the Shia Mullahs. 

Germany is planning to abolish fixed feed-in tariffs for small rooftop solar installations as of 2027, saying that falling costs have made the technology economically sound without subsidies (narrator: “it isn’t“), Bloomberg reported on Friday, citing a draft proposal for reforms it has seen.

At present, rooftop solar installations of any kind are eligible for guaranteed tariffs. But this could change in a few months, if the government approves the proposal of the German economy ministry to have subsidies abolished for projects of less than 25 kilowatts, according to OilPrice.

The ministry argues that the small rooftop solar are now often viable on their own without incentives, thanks to the lower costs.

“To strengthen the cost efficiency of solar expansion, a stronger focus will in future be placed on cost-effective solar parks,” the ministry’s proposal reads, as carried by Bloomberg.

The plans for a reform of the subsidies was first leaked by German media outlets.

“If the leaked draft is genuine, it would be yet another attack on renewable energy, following the grid package proposal,” said Ursula Heinen-Esser, president of Germany’s renewable energy association BEE.

Abolishing support for rooftop solar would have “disastrous consequences” for the sector and would deprive homeowners from participating in the energy transition, Heinen-Esser added.

The German Solar Association, BSW-Solar, also deplored the leaked draft proposal as “a frontal attack on Germany’s energy transition.”

Germany plans to boost onshore wind capacity to 115 gigawatts and solar capacity to 215 gigawatts by the end of the decade—targets which it will keep in the proposal for reforms. Europe’s biggest economy has a target to have renewables account for 80% of its electricity generation in 2030.

In solar, Germany is halfway through reaching its 2030 solar power targets, BSW-Solar said in June last year.

Germany saw the highest number of onshore wind turbines commissioned in the first half of 2025 for eight years, but the rebound in installations is still off track to reach the official targets, the German wind energy association, Bundesverband WindEnergie (BWE), said in the middle of 2025.

Authored by ‘eugyppius’,

Old friends may remember the farce we experienced last May, when outgoing Marshmallow Interior Minister Nancy Faeser pushed her gaggle of goons in the Federal Office for the Protection of the Constitution (BfV) to upgrade their political classification of Alternative für Deutschland.

No longer did the BfV consider the national political party to lurk under mere “suspicion of right-wing extremism,” oh no. They announced suddenly and with much establishment fanfare that they had determined the AfD to be “confirmed right-wing extremists.”

Faeser and her goons hoped this new designation would edge the AfD more firmly into Evil Nazi Fascist Hitler territory in the popular mind, thereby preparing the way for banning the party. According to the dumb Gender Studies-tier retards unassailable and unbiased experts of the BfV, the AfD were more definitely Evil, more definitely Nazi, more definitely Fascist and more definitely Hitler than ever before. They had such clear proofs of all the Evil Nazi Fascist Hitlerism lurking within the AfD that they could not even reveal them. Doing so, Faeser said, would compromise the mysterious sources and methods of her highly sophisticated political spy agency. Instead, the Interior Ministry leaked a classified dossier supporting the upgrade to sympathetic media like Der Spiegel, and these media promptly published earnest articles telling us all how absolutely Fascist and Evil and Nazi and Hitler all the secret evidence showed the AfD to be, because trust us bro.

What happened next is that somebody leaked the full 1,000-page dossier to the alternative news outlets Cicero and NiUS, both of which promptly published the full .pdf. It turned out to be one of the stupidest and most trivial documents I’ve ever read. The supersecret hyperspy sources tapped by the BfV? Google and social media posts. The supersecret hyperspy methods used by the BfV? Compiling interminable lists of potentially untoward or possibly impolite things AfD politicians uttered in googlable documents or on social media. It was so bad that almost overnight the dossier destroyed much of the momentum for an AfD ban – exactly the opposite of what its architects had intended. Even many establishment figures quietly admitted what a travesty the whole thing had turned out to be.

NEVERTHELESS: The establishment moved quickly to capitalise on the new extremist designation. Various state governments began plotting to cleanse the civil service of AfD members on the grounds that they were affiliates of an officially “extremist” organisation. In Rheinland-Pfalz they even toyed with the idea of illegally excluding AfD candidates from running in local elections also on the basis of this bureaucratic designation. The Social Democrats began pushing to initiate ban proceedings against the AfD, a move that – if successful – would grant the left parties indefinite parliamentary majorities both nationally and across many state parliaments, amounting to a kind of legal coup and casting us into a new DDR-light regime.

Meanwhile, the AfD filed suit with the Administrative Court in Cologne to overturn their upgraded designation because it was so obviously dumb and unfounded. They also asked the court to prohibit the designation temporarily, while their primary lawsuit is pending – a long involved process that will take years. The Cologne judges released their unusually extensive 55-page decision on the temporary injunction yesterday. For the party-banning speech-repressing opinion-monitoring enthusiasts of Our Democracy, it is a disaster.

From the Cologne court’s press release:

The Federal Office for the Protection of the Constitution (BfV) may not classify and treat the Alternative for Germany (AfD) as a confirmed right-wing extremist organisation until the conclusion of the main proceedings … The BfV must also refrain from publicly announcing such a classification …

In its decision today, the court has rejected the BfV’s assessment. We give the following reasons: According to the findings of the summary proceedings, there is sufficient certainty that the AfD houses some efforts directed against the free democratic basic order … These efforts, however, do not characterise the AfD such that its overall essence may be described as anti-constitutional.

That is very important.

Not only the AfD, but all political parties, have randos saying potentially or probably or even certainly anti-constitutional things.

To justify a ban, you need more than random people saying random things.

You need to show a) that the party is fundamentally opposed to the “free democratic basic order” (an ideological trinity consisting of human dignity, democracy and the rule of law), and b) that it exercises this opposition in an “aggressive” or “combative” manner. The BfV have hardly addressed b) at all, and their evidence has not convinced the court that a) applies.

To argue their case, the BfV seem to have positively emptied their archives, submitting not only the leaked 1,000-page dossier to the court, but also an additional raft of supporting materials running to 7,000 pages across 20 different binders and electronic files extending to 1.5 terabytes.

The court finds that some “anti-Muslim” demands formulated by the AfD in the course of the 2025 election campaign are contrary to the German Basic Law, because these would tend to vitiate “the equal practice of religion,” but the judges also find that these are insufficient to “establish the anti-constitutional character of the party as a whole.” The court further noted that the BfV “has not disclosed any intelligence information … even in court proceedings” relating to allegedly secret anti-constitutional plots within the AfD, which means that “we cannot assume to the detriment of [the AfD] that [the party] is pursuing such further plans internally.”

A significant prong of the constitutional protectors’ argument held that the AfD’s advocacy of “remigration” was itself openly unconstitutional. Importantly, the court completely disagreed:

… [N]o sufficient conclusions can be drawn from any plans pursued by [the AfD] … with regard to so-called remigration. The vague term “remigration” does not imply a concrete political goal in the sense of undifferentiated deportations … In the absence of a more concrete explanation of specific anti-constitutional intentions with respect to implementing a … remigration policy, such intentions are not apparent.

As I said, this is only a temporary ruling, but given the devastating wording of the court’s judgment, it seems unlikely that the judges in Cologne will ultimately uphold the “extremist” designation when to comes time to decide the main case some years from now. The constitutional protectors may also appeal this injunction, but they would be unlikely to win, and also too I think there is a substantial chance that their ultimate boss, Interior Minister Alexander Dobrindt (CSU), directs them to let this go. Whatever happens, the case for banning the AfD has taken a major, perhaps a fatal, blow. The fundamental problem this whole time has been that the AfD programme is pretty much constitutionally unassailable. Those who want to ban the party have had to hope against hope that the constitutional protectors could unearth secret AfD Nazi plans via their super advanced espionage methods. Instead they’ve spent years copying and pasting Facebook posts and they have basically nothing.

This case converges with other evidence suggesting that the German state – while it may presently wish to ban the opposition and repress its critics – increasingly lacks the internal resolve and coherence for this project.

I’ll write more about that tomorrow; today’s adventures (see below) interrupted my routine, but I wanted to get this news out there as soon as possible.

The first time Iran found itself in a major regional war with Donald Trump about to enter the White House, was April 13, 2024 when as part of escalating tensions with Israel, “Iran began an attack on Israel by launching dozens of suicide drones” on April 13, 2024. That said, it is s stretch to call that particular weapons exchange war, as both sides just wanted some theatrical appreciation rather than rearranging the borders of the middle East. What is more notable, is that the war started in the deep dark of a Saturday morning (April 13, 2024) when global markets were closed, and the only traded asset was crypto in general, and bitcoin in particular. The kneejerk reaction was sharply lower. 

The second time Iran found itself in a major regional war with Donald Trump (already in) the White House, was a little over a year later, on June 21-22, when in a much more serious and aggressive attack, Operation Midnight Hammer saw airstrikes, cruise missile attacks and B-2 bombers drop Massive Ordnance Penetrators on three key Iranian nuclear sites: Fordow, Natanz, and Isfahan, all of which were quickly destroyed As a result, Iran’s nuclear enrichment process was effectively (and literally) buried under a mountain, and then the major regional conflict was again promptly forgotten. What is most notable, is that that war, too, started in the deep dark of a Saturday morning (June 21, 2025) when global markets were closed, and the only traded asset was crypto in general, and bitcoin in particular. The kneejerk reaction this time too, was sharply lower. 

Fast forward to today, when in the most serious war between Iran and a coalition of US and Israel forces in decades, Iran was promptly “decapitated” as all of its top generals and IRGC personnel were killed, while also losing its spiritual head, the Ayatollah, who had led the country ever since those fateful days in 1978 when Shah Mohammed Reza-Pahlavi was replaced with Ruhollah Ayatollah, and an American embassy and its occupants were taken hostage. This conflict started shortly after the sun rose, as the attacking generals thought a night attack which everyone – and especially Iran – would expect as it is “meant” to be surprise would have little impact. They were right, and Ayatollah Khomeini was promptly vaporized. Where there was similarity to previous conflicts is that this one too started early on Saturday, when global markets were closed. Well, not all: bitcoin was trading. And, like the previous two most recent regional wars, Bitcoin’s kneejerk reaction this time too, was sharply lower… but not for long, and shortly after it emerged that Ayatollah Khameini was dead and most of the army leaders had been killed, bitcoin – that weekend trading risk barometer – staged a remarkable rebound and was actually trading well above where it was before the currency sold off shortly after midnight on Saturday East Coast time.

Which begs the question: is the conflict now effectively over and is Wall Street getting the all-green signals? 

This is also the question asked by Academy Securities strategist Peter Tchir, who in a late Saturday note – when most of the latest development were already known –  wrote that he remains comfortable buying the market.

He explains why below: 

A lot was priced in. Brent has gone for $60 late December to $72 on Friday. Some of that move in energy prices likely tied to cold winter in America, etc, but away from the risk of conflict, the market was positioned for selling off. So far the “bad” news on the oil front should have been largely priced in.

• Insurance for shipping in region cancelled.  pretty standard
• Limited or no transit in the Strait of Hormuz. Should be expected

The “good” news on the oil front is that nothing has happened that would prevent transit if there is an off ramp. 

China supposedly has large stockpiles of crude and the U.S. in good shape, so a short disruption (a week or so) should have minimal impact. Spot oil contracts might go as high as $80 but am not expecting a big move out the curve

Furthermore, while it is early, so far intelligence and military in action have delivered at high levels for the US and Israel. Not so much for Iran.  Maybe they have another round up their sleeve, but according to Tchir, :”their calculus should be adjusted – to seek off ramp“

With confirmations stating that the leadership has been hit hard, what is the thought process of those assuming command:

You know that Isreal and the U.S. probably know who you are and possibly where you will be. That cannot be comforting.

Their weapon systems have performed as advertised (or maybe even better than expected).

Your weapons, like in prior attacks, and like Russia has experience, have not been as good as expected.

Which brings us to Bitcoin, which Tchir – and anyone else – views as a risk-on type of asset in this situation, has now recovered from small early loss to slightly highere. 

Putting it all together, Tchir – looking through the fog of war – says that he is optimistic for a “risk on” start to the week, while may sound a little bit callous, which is also why the Academy Strategist notes that “we can only hope that the events in the Middle East lead to a peaceful resolution, putting the Iranian people on a better path to prosperity and freedom, while minimizing the loss of life for everyone in the region.”

Authored by Antonio Graceffo via The Epoch Times (emphasis ours),

Shortly after meeting with Chinese Communist Party (CCP) leader Xi Jinping in late October, President Donald Trump said China would never attack Taiwan while he is president because Chinese officials “know the consequences.” While support from the United States is welcome news for Taiwan, Trump’s words raise a real question: Does Xi actually know the cost of invading Taiwan?

Much of the analysis of a potential Beijing attempt to seize Taiwan by force has centered on the Chinese military’s capabilities and Taiwan’s defenses, especially if supported by the United States. Many assessments conclude that the People’s Liberation Army (PLA) is not currently capable of defeating the U.S. military in a direct conflict.

However, analysts still warn of a worst-case scenario in which Xi, seeking to cement his legacy, launches a premature strike. Xi has tied his legitimacy to the “China Dream” of national rejuvenation by 2049 and has framed unifying Taiwan with the mainland as essential to achieving that goal.

The recent wave of purges, particularly of senior leaders such as former Central Military Commission (CMC) Vice Chairman General Zhang Youxia, has intensified speculation. With most of the commission allegedly removed and the CMC now effectively consisting of Xi and loyalist Vice Chairman Zhang Shengmin, some analysts argue that Xi has eliminated voices that could have dissuaded him from attacking Taiwan. Even if that was not his intent, the practical result may be similar. With little meaningful pushback inside the system, Xi could face fewer internal constraints if he chooses to act.

The German Marshall Fund and the Rhodium Group recently published “If China Attacks Taiwan,” a report examining the potential costs to Beijing of a prolonged war. The authors note they were not asked to adopt Xi’s personal perspective and acknowledge that Chinese authorities could misjudge the likely consequences.

Even when costs are high, national leaders sometimes proceed if perceived benefits or political pressures outweigh the risks. Xi could conclude that failing to act—particularly if he believes Taipei is moving toward permanent separation with U.S. backing—would damage his authority more than launching a risky military operation.

The study examines how a conflict would affect China’s economy, military capabilities, social stability, and international position. It warns that war could produce massive economic disruption, catastrophic military losses, serious social unrest, and severe sanctions. This brings the analysis back to three critical questions: What would the price of a Taiwan invasion be? Is Xi fully aware of that price? And does he care? The latter two only Xi can answer, but the first is measurable, and the potential impact on the CCP would be staggering.

In the report’s major war scenario, an invasion lasts several months and draws in the United States and its allies. The conflict begins with an amphibious assault and missile strikes on Taiwan as well as on U.S. forces in Japan and Guam. Although Chinese forces land on Taiwan, sustained Taiwanese and U.S. strikes disrupt resupply across the Taiwan Strait. After months of heavy fighting, the PLA withdraws to the mainland, having lost roughly 100,000 personnel. Taiwan suffers approximately 50,000 military and 50,000 civilian casualties. The United States loses 5,000 military personnel and 1,000 civilians, Japan loses 1,000 military personnel and 500 civilians, and the PLA retains control only of Kinmen and Matsu.

The report argues that a failed Chinese attack would impose severe economic, military, social, and international costs, and that it would be a mistake to assume Beijing would necessarily prevail. Even a limited military engagement could result in trillions of dollars in losses.

A 2022 Rhodium study estimated economic damage of at least $2 trillion to $3 trillion under conservative assumptions, while Bloomberg analysts projected costs closer to $10 trillion. In a prolonged war ending with Chinese withdrawal, the economic impact would extend beyond market disruption to systemic breakdown.

China is uniquely exposed because roughly 20 percent of its GDP and about 13 percent of its employment depend on exports, double the U.S. share. A major conflict would likely trigger a near-total embargo by G7 nations. After years of doubling down on high-tech manufacturing such as electric vehicles, semiconductors, and green technology instead of strengthening domestic consumption, China would have few alternative markets for its surplus output. Without export demand, large portions of its industrial base would idle, leading to a contraction in GDP potentially worse than during the COVID-19 pandemic period.

[ZH: And where, pray-tell, does the west get all of the ‘shit’ made during this embargo?]

Financial decoupling would compound the shock. The report anticipates the freezing of China’s roughly $3.39 trillion in foreign exchange reserves and places its $3.6 trillion in foreign direct investment at risk. Even if Beijing achieved military objectives, the global financial system could treat China as permanently uninvestable, effectively ending its role as a global financial hub. Hong Kong would likely lose its status as the primary gateway for international capital into the mainland.

Energy and food security add further strain. A months-long war could allow the United States and its allies to impose a distant blockade, cutting off 70 percent to 90 percent of the oil and roughly 40 percent of the natural gas that China imports by sea. Severe energy and food rationing could follow, increasing the risk of domestic unrest. With domestic demand already weakening, sanctions or a blockade would strike at one of China’s remaining growth engines.

The CCP’s legitimacy depends heavily on economic stability. A failed war that produces mass unemployment, shortages, a financial crisis, and long-term technological isolation could fracture the global economy into rival blocs, leaving China isolated for decades. Although the PLA has grown stronger, its economic vulnerabilities mean that the cost of a failed invasion could pose an existential challenge to the CCP itself.

Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times or ZeroHedge. 

Authored by Andrew Moran via The Epoch Times (emphasis ours),

Long-awaited banking regulation—also known as the Basel III Endgame framework—will be released next month, said the Federal Reserve’s top banking regulator.

Fed Vice Chair for Supervision Michelle Bowman, appearing at a Senate Banking Committee hearing on Feb. 26, confirmed that regulators are expected to release an updated Basel III proposal at the end of March.

But while this is the chief goal, Bowman hinted that the deadline might need to be extended.

She told lawmakers that officials at the Fed, Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corporation have reached a consensus on the reproposal.

Basel III is a regulatory blueprint crafted in the fallout of the global financial crisis of 2008. It features a number of capital reforms and tighter requirements for how large U.S. banks measure credit, market, and operational risk.

In recent months, Bowman has teased that Basel III has retooled capital requirements, a move that could bolster lending by traditional lenders, particularly in the mortgage market.

“We’re very focused, as we were thinking about the Basel approach, in ways that we could right-size and recalibrate the approach for residential mortgage lending so that we could encourage the banks to get back into the mortgage business,” Bowman told senators.

“We’re refocusing our supervision in a laser focus on material financial risks.”

This comes shortly after Bowman suggested new mortgage capital rules for U.S. banks would be integral to the Basel III proposal.

Appearing at an American Bankers Association event on Feb. 16, Bowman stated that one change could tie a mortgage’s risk weight to its loan-to-value-ratio, effectively removing the one-size-fits-all approach. Another update could remove a provision requiring that banks deduct mortgage‑servicing assets from regulatory capital.

For years, critics have argued that the original Basel III proposal would have reduced lending due to higher capital mandates and would have led to higher funding costs for borrowers.

Proponents say higher capital requirements are necessary to prevent a similar financial crisis in the future.

But while the focus has been on Basel, Bowman argued that other issues also need to be addressed, including the Consumer Financial Protection Bureau’s stringent requirements and the sizable penalties banks face if they make mistakes on mortgage applications.

“I think it’s important that we think about this in a broader manner and holistically as we approach thinking about banks getting back into the mortgage space,” Bowman said.

Support for Homeownership

Overall, Bowman noted, the upcoming reproposal could spark affordable homeownership, ensure banks of all sizes come off the sidelines, and support market liquidity.

“My approach is to calibrate the new framework from the bottom up, rather than reverse engineer changes to achieve predetermined or preconceived outcomes to capital requirements,” she stated.

This comes as a group of eight major banking and housing associations urged regulators to ease mortgage capital requirements.

In a letter to the Fed, the Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corp., the organizations stated that today’s regulatory environment discourages bank participation in mortgage markets, exacerbating housing affordability challenges.

The groups said they support current efforts to alter the Basel III Endgame rule, casting the process as an opportunity to strengthen mortgage‑market stability and create space for banks to play a larger role in home lending.

“Adequate capital reduces the likelihood of bank failures that threaten broader financial stability, which can prove costly for households, financial institutions, and taxpayers,” the letter stated. “However, excessive capital requirements that are misaligned with empirically derived risk assessments can negatively affect the cost of and access to credit.”

Revitalizing the mortgage market has been one of the current administration’s objectives to ensure more households have an opportunity to become homeowners.

In his record-length State of the Union address, President Donald Trump noted that his economic agenda balances the needs of current homeowners and homebuyers.

“Low interest rates will help reduce the Biden‑created housing affordability crunch,” Trump said. “We want to protect those values. We want to keep those values up. We’re going to do both.”

As of Feb. 26, the average 30-year fixed-rate mortgage is 5.98 percent, according to Freddie Mac’s Primary Mortgage Market Survey.

A recent National Association of Realtors poll found that 85 percent of U.S. voters believe homeownership is central to the American dream.

Authored by Steve Watson via Modernity.news,

New revelations from Rep. Anna Paulina Luna expose Jeffrey Epstein’s network as a sophisticated honeypot operation likely tied to foreign intelligence, designed to compromise powerful figures through sex trafficking and blackmail.

Luna, leading the congressional probe, asserts the scandal runs deeper than previously known, with inconsistencies in plea deals for key female accomplices fueling suspicions of a cover-up to protect the elite.

Based on evidence reviewed in the investigation, Luna stated that Jeffrey Epstein was running an intelligence-gathering operation, stating “In my professional opinion, I do believe it was a honeypot operation.”

Based on our congressional investigation it is my professional opinion that Jeffrey Epstein was running a honey pot operation. I am calling on Oversight to bring these 4 women in for questioning as co-conspirators to child sex trafficking. pic.twitter.com/KmxEovN9hC

— Rep. Anna Paulina Luna (@RepLuna) February 27, 2026

“It has become very evident…that Jeffrey Epstein was running an intelligence gathering operation,” Luna continued, noting “We might be able to get justice.”

She elaborated, “I do believe that Jeffrey Epstein was targeting many politicians, many influential people, especially in regards to economic policy. I do believe that it was possible that not just (Bill Clinton), but Secretary Clinton as well as a number of other people were targeted.”

Luna called for subpoenas on four women identified as co-conspirators: Sarah Kellen, Nadia Marcinkova, Adriana Ross, and Lesley Groff.

?Congresswoman Anna Paulina Luna drops BOMBSHELL, reveals she believes Jeffrey Epstein was running an Intelligence gathering Honey Pot Operation based on evidence and testimony.

She is also calling on on four co-conspirators involved in trafficking who she says are being… pic.twitter.com/WUgdiv2G34

— Benny Johnson (@bennyjohnson) February 27, 2026

These individuals received immunity under Epstein’s 2008 non-prosecution agreement, despite allegations of scheduling abuse, recruiting victims, and participating in acts.

Luna also highlighted other discrepancies, such as Susan Hamblin sending an email in which she told Epstein his “littlest girl was naughty,” yet receiving victim status and a plea deal.

? Rep Anna Luna just revealed that Epstein “victim” Susan Hamblin sent the “your littlest girl was naughty email”

“Susan Hamblin sent this email. She took a plea deal and was given “victim” status under previous DOJ. DOJ should look into charges.

Possible human rights… pic.twitter.com/NMIxgv1sLk

— Red Panda Koala (@RedPandaKoala) February 18, 2026

The Congresswoman also pointed to Nadia Marcinkova, who sent explicit emails as an adult co-conspirator but was granted victim status.

This email was sent by a woman named Nadia. The same Nadia that was listed as co-conspirator in the NY case. She was then given a plea deal and “victim” status.

There’s a big difference between minors that were victimized versus ones that became adults and then chose to do… pic.twitter.com/NOXGDdgg6m

— Rep. Anna Paulina Luna (@RepLuna) February 18, 2026

Luna demanded, “The DOJ NEEDS to re-open these cases, adding that the “Previous DOJ let them off.”

She added, “Why were a number of Epstein’s co-conspirators given plea deals for trafficking minors? Child sex traffickers do not deserve plea deals or immunity. EVER.”

Why were a number of Epstein’s co-conspirators given plea deals for trafficking minors? Child sex traffickers do not deserve plea deals or immunity. EVER. pic.twitter.com/wT4CEQz1Gd

— Rep. Anna Paulina Luna (@RepLuna) February 27, 2026

Barry Levine, author of “The Spider,” reinforced on Jesse Watters’ show that female co-conspirators received plea deals for trafficking.

Levine noted models from around the world were involved, echoing Luna’s foreign ties concerns.

Barry Levine knocked it out of the park on Watters right now. FEMALE Co-conspirators were given plea deals! There is a lot here. Trafficking etc. everyone needs to see this segment. pic.twitter.com/B2dfYbBLDG

— Rep. Anna Paulina Luna (@RepLuna) February 27, 2026

Jesse Watters highlighted, “Hillary did seem perceptive to the idea.”

BREAKING: Rep Anna Paulina Luna says Hillary was PRESSED on Jeffrey Epstein’s FOREIGN INTELLIGENCE TIES ?@RepLuna: “It’s safe to say, Epstein was TIED to Foreign Intelligence… RUSSIA, IRAN, ISRAEL” ?

“Hillary did seem perceptive to the idea” ?? pic.twitter.com/1GkJJG8Ynh

— Jesse Watters (@JesseBWatters) February 27, 2026

In another major development in the case, former President Bill Clinton testified under oath that President Trump was not involved at all with Epstein to his knowledge.

?? BREAKING: Democrats are DONE. President Bill Clinton testifies UNDER OATH that President Donald Trump WAS NOT involved with Jeffrey Epstein

“Trump has never said anything to me to make me think he was involved [with Epstein].”pic.twitter.com/seQ15pfTrI

— The Patriot Oasis™ (@ThePatriotOasis) February 27, 2026

Clinton stated, “Trump has never said anything to me to make me think he was involved [with Epstein].”

Luna confirmed, “President Trump has been exonerated. He is not considered a person of interest in our Congressional investigation.”

President Trump has been exonerated. He is not considered a person of interest in our Congressional investigation. Democrats continue to insist otherwise to smear him and sabotage his presidency. It’s a political game to them. pic.twitter.com/QlwlWE3YFd

— Rep. Anna Paulina Luna (@RepLuna) February 27, 2026

She accused Democrats of smearing Trump, saying, “Democrats continue to insist otherwise to smear him and sabotage his presidency. It’s a political game to them.”

“We had cooperation, we asked the victims directly and he was exonerated,” Luna said.

Fresh documents from the mass file release have also revealed a shocking intrusion into the FBI’s NYC office on Super Bowl Sunday in 2023, resulting in the loss of approximately 100TB of evidence.

FBI Special Agent Aaron Spivack detailed the breach in a declaration, stating, “500 terabytes of data was gone as a result of the intrusion. I was able to recover about 400 terabytes of that data, however. I was told to Google how to recover the data. No one else tried to help us.”

Spivack described discovering unusual activity: “Around 3:30pm or so we located the log files and began combing through, which is when we noticed strange IP activity that took place yesterday from two IP addresses. The activity included combing through certain files pertaining to the Epstein investigation.”

He continued, “I reached out to one of the case agents to see if they were in the office yesterday, thinking that maybe they inadvertently changed a setting on the NAS or if they noticed anything strange about them.”

Further investigation revealed, “Around 4/4:30pm we dove into the IPs and checked all of our computers to see which had the IPs in question. One computer, our discovery computer, matched one of them and is located in a room next to the lab. The other IP is one we don’t recognize, but it is the same address as the IP on our network, leading us to believe it was a computer that accessed our network somehow.”

Spivack concluded, “We were not able to identify the computer, but it had to have accessed our network either by being plugged into the network, or possibly by telnetting in virtually.”

This breach raises serious questions about security lapses and potential efforts to suppress evidence in the Epstein case.

These disclosures build on anomalies detailed in our prior reports, where DOJ documents referenced Epstein’s death as a “MURDER” and highlighted red flags like mismatched autopsy details and missing footage.

The inconsistencies point to elite protection of the operation. 

Theories that both Epstein and Ghislaine Maxwell were intelligence operatives linked to Mossad, other foreign entities and a “supra government” shielding elites have exploded online.

As demands for the full client list grow, these revelations expose a web of elite impunity. The public deserves unredacted truth to dismantle any remaining deep state shields.

Your support is crucial in helping us defeat mass censorship. Please consider donating via Locals or check out our unique merch. Follow us on X @ModernityNews.

Iranian state TV confirms the Supreme Leader’s death… as well as the deaths of his daughter, son-in-law, grandson, and daughter-in-law.

Iranian state media confirms the death of Ayatollah Ali Khamenei and announces 40 days of mourning, 7 days of public holiday pic.twitter.com/eiV5a9Qo7Y

— Nicole Grajewski (@NicoleGrajewski) March 1, 2026

What comes the day after? This US-Israeli regime change action may have just opened pandora’s box.

• US official confirms to Fox that US believes Khamenei and 5-10 top Iranian leaders killed in initial Israeli strike on compound; agree with Israel’s intelligence assessment.

• No U.S. casualties reported, 12 hours after Washington launched Operation Epic Fury alongside Israel, targeting Iran’s security and military infrastructure, CENTCOM says. Al Jazeera reporting over 200 killed in Iran. Likely the death toll will climb.

• AFP: Two Israeli TV networks report photo of Khamenei’s body shown to Trump, Netanyahu

• Israeli ambassador to Washington Yechiel Leiter told U.S. officials that Iran’s supreme leader Ali Khamenei has been killed in the Israeli strike on his compound, a source with knowledge said (Axios).

• Jerusalem Post (unconfirmed): Israeli officials informed Khamenei assassinated in Iran strike, body said to be found in rubble. Iranian authorities themselves have not said this, and an information block/fog of war inside Iran persists.

• Israeli official says Khamenei killed; Trump: Regime really didn’t want a deal

• PressTV: The Islamic Revolution Guards Corps (IRGC) has announced that it destroyed a sophisticated American radar system stationed in Qatar as part of its retaliatory attacks targeting US bases and assets in the region.

• “I can go long and take over the whole thing, or end it in two or three days and tell the Iranians: ‘See you again in a few years if you start rebuilding [your nuclear and missile programs],” Trump said in a five-minute phone interview from Mar-a-Lago (Axios).

• Trump calls for regime change. Will he commit ground troops to do it? Meanwhile Netanyahu addresses Iranian people, claiming “help has arrived.”

• Iran signals could be ready for de-escalation after regional missile barrage: Tehran indicates it does not want further escalation following retaliatory missile strikes on at least five countries, including Israel. Iranian state TV cancels a long-promised speech by Ayatollah Khamenei. An Israeli official says regime leaders cannot currently locate him. US strikes appear to have continued in waves on Saturday.

• Iran targets US military sites, not US mainland: Foreign Minister Abbas Araghchi tells NBC News that Iran is striking US military facilities in the region, not “Americans in their land,” and says Tehran is ready to talk once US-Israeli strikes stop. He states Khamenei is alive “as far as I know” and confirms two commanders were killed but senior leadership remains in place.

• Senior Iranian commanders reported killed: Reuters cites sources saying Defense Minister Amir Nasirzadeh and IRGC commander Mohammed Pakpour were killed in Israeli strikes.

• Israeli strike allegedly hit girls’ elementary school in southern Iran: An airstrike in Minab, Hormozgan province, struck a primary school for girls, killing dozens, according to state media, underscoring the likely mounting civilian toll from the large-scale US-Israeli bombardment of Iran.

• Regional panic and military buildup: Gulf residents rush to stockpile supplies; the UAE reassures the public about reserves. The UK confirms aircraft are supporting US-Israeli operations.

• Operation Epic Fury expands: The US-Israeli campaign continues striking Iranian military infrastructure, senior leaders, and high-value targets across multiple cities. Satellite imagery shows severe damage to Khamenei’s compound in Tehran; his whereabouts remain unclear.

• Trump announced start of “major combat operations”: In an eight-minute address, President Trump says the US is conducting a “massive and ongoing operation” to destroy Iran’s missile capabilities and demands Iranian forces surrender or face “certain death.”

• Iran further threatens regional bases: Iranian Armed Forces spokesman Gen. Abolfazl Shekarchi warns that any regional base used by the US or Israel will be targeted. Reports emerge of Iranian retaliatory strikes across the Middle East.

• Iran launches regional retaliation: Tehran fires missiles at Israel and US-linked assets in Qatar, UAE, Kuwait, Bahrain, Syria, Jordan, and Iraq. Explosions hit Tehran and other Iranian cities. Multiple countries close their airspace.

• Coordinated US-Israel strikes dubbed ‘Operation Epic Fury’: Washington and Tel Aviv launch joint attacks on Iranian targets after months of planning, following failed indirect nuclear talks. Trump frames the operation as eliminating “imminent threats” and calls on Iranians to “take over your government.”

* * *

Update (10:00ET): Will the chaos be contained, after Iran unleashed retaliatory missiles on at least five regional countries, including Israel? Iran is quickly signaling that it’s not willing to escalate this further, hoping for a halt in the US-Israeli operation:

Iran is attacking U.S. military facilities in the Middle East region and not “Americans in their land,” Iranian Foreign Minister Abbas Araghchi said in his exclusive interview with NBC News.

He added that Tehran was interested in de-escalation and ready to talk once the joint U.S.-Israeli strikes end.

Amid rumors that Ayatollah Ali Khamenei could be dead, after direct strikes on his main headquarters in the capital, Araghchi said that he is still alive “as far as I know.”

Araghchi is directly signaling the American side via an exclusive interview with NBC News. He spoke live from Tehran Saturday morning. He acknowledged that “two commanders had died but senior officials in the regime had survived including the head of the judiciary and the parliament speaker.”

“All high ranking officials are alive,” he said. “So everybody is now in its position, and we are handling this situation, and everything is fine.” 

Iranian Defense Minister Amir Nasirzadeh and Islamic Revolutionary Guard Corps commander Mohammed Pakpour were killed in Israeli strikes, according to two sources briefed on Israel’s military operations and one regional source, cited in Reuters.

As for finding the Ayatollah, he is probably deep in a hidden underground bunker that no one but his closest IRGC advisers know about. Americans need to be reminded that this is a country of over 90 million people and geographically is the size of half the European continent.

Bloomberg writes on the prospect of full regime change, which would likely require US boots on the ground:

Conflicting reports are circulating about who in Iran was targeted and whether the attacks were successful. If senior Iranian officials were indeed killed, that would be significant. But it doesn’t mean the end of the Islamic Republic.

While the Supreme Leader is the ultimate decision-maker, he isn’t the only one, and succession planning has been underway for years. Similarly, the Revolutionary Guards are deeply embedded across political, economic, and security sectors. Targeting their leadership would weaken them, but it wouldn’t dismantle the organization altogether.

Gulf populations in panic mode, via Bloomberg:

In Dubai, some delivery services have been suspended as people flood supermarkets to buy water and other food essentials. Stockpiling prompted UAE authorities to issue a statement to reassure residents and the millions of expatriates that there is ample supply.

The UAE said its strategic reserve of essential commodities is “robust, comprehensive and diversified and asked people to refrain from stockpiling.

The UK has meanwhile confirmed that it has planes in the air supporting the US-Israeli operation.

* * *

Update (0845ET):

Iranian military officials said they would deliver a “historic lesson” to Israel and the U.S. in response to the strikes, as Operation Epic Fury, the U.S.-Israeli campaign designated by the Department of War, continues to hit military infrastructure, top army leaders, and other high-value targets across multiple Iranian cities.

Earlier footage allegedly showed the Iranian supreme leader’s compound being struck by what appeared to be U.S. or Israeli missiles or air-delivered munitions.

New Airbus satellite imagery reportedly shows the compound in Tehran sustained severe damage; it remains unclear whether Ayatollah Khamenei was inside at the time of the strike.

Shortly after Operation Epic Fury began, President Trump announced in an eight-minute video on Truth Social that “major combat operations” had begun.

“The United States military is undertaking a massive and ongoing operation to prevent this very wicked, radical dictatorship from threatening America and our core national security interests,” the president said. “We are going to destroy their missiles and raze their missile industry to the ground.”

Trump continued, “To the members of the Islamic Revolutionary Guard, the armed forces, and all of the police, I say tonight that you must lay down your weapons and have complete immunity or, in the alternative, face certain death.”

Operation Epic Fury comes amid the U.S. building a massive military presence in the region (read report). Also, one day after indirect nuclear talks (read here) between the U.S. and Iran did not end so well, according to Trump.

U.S. officials told NBC reporter Courtney Kube that Israel has targeted Iranian leaders, while the U.S. has targeted Iran’s ballistic missile and nuclear high-value facilities.

There are reports that IRGC Commander Mohammad Pakpour was killed by Israeli strikes.

According to assessments, Mohammad Pakpour, the Commander of Iran’s Islamic Revolutionary Guard Corps (IRGC), has been eliminated by Israeli decapitation strikes on Tehran. pic.twitter.com/KpNyrNuWgh

— OSINTdefender (@sentdefender) February 28, 2026

Gen. Abolfazl Shekarchi, the spokesman for Iran’s Armed Forces, told state media that any military base used by the U.S. and Israel in the region will be targeted. There have already been reports of Iranian retaliatory strikes across the region.

Sources tell CNN that Operation Epic Fury was the result of “months of joint planning” and will involve several days of attacks.

*   *   * 

The U.S. and Israel have conducted coordinated strikes on Iranian targets, which President Trump described in an eight-minute video on Truth Social as the start of “major combat operations” aimed at defending the U.S. by “eliminating imminent threats from the Iranian regime.”

“The hour for your freedom is at hand,” President Trump told the Iranian people in the video. “When we’re finished, take over your government. It will be yours to take. This will be probably your only chance for generations.”

President Donald J. Trump on the United States military combat operations in Iran: pic.twitter.com/LimJmpLkgZ

— The White House (@WhiteHouse) February 28, 2026

President Trump is expected to address the American people on Saturday morning following the second U.S. strike on Iranian soil in less than a year. The first strike took place in June 2025, when U.S. stealth bombers dropped bombs on three nuclear sites inside Iran.

The focus on the Saturday morning strikes (Brent crude futures are closed), the president said, was to ensure Americans “will never be threatened by a nuclear-armed Iran.”

Bloomberg headline: Oil Tankers Avoiding Vital Hormuz Strait After US Bombs Iran

Oil Tankers Avoiding Vital Hormuz Strait After US Bombs Iran: BBG

— zerohedge (@zerohedge) February 28, 2026

In markets, with Brent crude futures closed, Bitcoin was hammered from the $65k level, down to the $63k level.

US and Israeli strikes on Iran come one day after the latest round of indirect nuclear talks between Iran and the US, about which the president said he was “not happy with the progress,” adding: “They don’t want to say the key words: ‘We’re not going to have a nuclear weapon.'”

A US official told CNN that the US strikes were focused on Iranian military targets but did not comment on the ongoing operation. Another official told the outlet that the objective of the strikes was to address the Iranian military threat. The first official said the US military had put countermeasures in place to protect its personnel in the region.

AP News reports:

The first strikes of the attack appeared to target the compound home to Iran’s 86-year-old Supreme Leader Ayatollah Ali Khamenei in downtown Tehran. It wasn’t immediately clear if he was there at the time. Smoke could be seen rising from the Iranian capital.

JUST IN — 🇮🇷🇮🇱🇺🇸 The strike on the presidential palace in Tehran pic.twitter.com/YLY4ShMrUC

— UK Report (@UK_REPT) February 28, 2026

BREAKING:

Israel is currently striking Iran’s capital, Tehran. pic.twitter.com/xQ3lZSQm5h

— Globe Eye News (@GlobeEyeNews) February 28, 2026

Shortly after the strike, the US Department of Defense wrote on X, “Operation Epic Fury.” For context, last year’s strike against Iran’s nuclear facilities was “Operation Midnight Hammer.”

OPERATION EPIC FURY 🇺🇸

— Department of War 🇺🇸 (@DeptofWar) February 28, 2026

Iranian state-run media outlets Fars and IRNA reported strikes in Isfahan, Qom, Lorestan, Karaj, Kermanshah, and Tabriz, as well as in the capital, Tehran.

Israel described the strikes against Iran as “a broad, coordinated, and joint operation against the regime” that was planned for months.

🚨🇺🇸🇮🇷 U.S. Tomahawk cruise missiles flying over Iraq toward Iranpic.twitter.com/elRKAy7MK6 https://t.co/bJ3LEpDsMG

— Mario Nawfal (@MarioNawfal) February 28, 2026

Earlier, Israeli Prime Minister Benjamin Netanyahu said in a recorded message that Israeli military action against Iran would be “much more powerful” than Israel’s 12-day operation against Tehran last year.

In response, Iran’s paramilitary Revolutionary Guard launched a wave of drones and missiles targeting Israel. There were other reports that the U.S. Navy’s 5th Fleet command center in the host nation, Bahrain, was targeted by Iranian missiles.

🚨🇺🇸🇮🇷 Iranian missile striking Bahrain.pic.twitter.com/e8mo4gEKKS https://t.co/x2AM1ErncS

— Mario Nawfal (@MarioNawfal) February 28, 2026

Other reports suggest Iran launched projectiles at US bases and targets beyond Bahrain, and also in Kuwait and Qatar.

Iran’s Foreign Ministry wrote on X, “The time has come to defend the homeland and confront the enemy’s military assault. Just as we were prepared for negotiations, we have been even more prepared for defense at all times. The armed forces of the Islamic Republic of Iran will decisively respond to the aggressors with full authority.”

*Developing…

Amid an armada of dystopian futurists, projecting linear thoughts into a future of ‘AI uber alles’, Marc Andreessen stands as a beacon of potential utopian light, seeing a future that looks very different and very positive for young and old alike.

In a brief few minutes, the co-founder of Netscape and VC firm Andreessen Horowitz (a16z) believes instead that we are living through a unique (and most incredible) time in history with the rise of AI coming right as human civilization needs it…

“we’re going to have AI and robots precisely when we actually need them [with populations shrinking] to keep the economy from actually shrinking.”

Simply put, Andreessen says that fears of AI-driven mass job loss are overly simplistic.

After decades of unusually slow technological change and low job churn, AI could restore historical productivity levels (exemplified by the period from 1870-1930), sparking opportunity, innovation, and net job growth rather than displacement. 

Declining populations and reduced immigration will make human labor increasingly valuable. AI’s timing is “miraculous”, Andreessen exclaims, preventing economic shrinkage from depopulation.

In even radical scenarios, explosive productivity leads to output gluts, collapsing prices, and massive real-wealth gains – equivalent to “giant raises” for everyone – while making safety-nets more affordable. 

Whether incremental or transformative, Andreessen sees the outcome as fundamentally positive economic news.

“…there’s all this concern among young people that their jobs are not going to be there for them. AI is replacing them…”

Andreessen replies (emphasis ours): 

So the job-substitution/job-loss thing is very reductive. I think it’s an overly simplistic model. And again it goes back to what I said at the very beginning which is we’ve actually been in a regime for 50 years of very slow technological change in the economy… like at half the rate of the previous era and a third the rate of like 100 years ago.

And so we’re coming out of this kind of phase where we’ve had like almost no technological progress in the economy. We’ve had remarkably little job churn as a result of that relative to any historical period. And so even if AI triples productivity growth in the economy, which would like be a massively big deal, it would take us back to the same level of job churn that was happening between 1870 and 1930.

And if you go back and you read accounts of 1870 to 1930, people just thought the world was awash with opportunity. Right? At that rate of technological transformation, kids were able to develop new careers into new areas of the economy, building new kinds of products and services. A huge part of everything in our modern world today was kind of invented and proliferated during that period.

And so even if AI triples the pace of economic change in the economy, it’s going to translate to a much higher rate of economic growth; it’s going to translate to a much higher rate of job growth. And there will be some level of like task level and job level substitution that will take place but that will be swamped by the macro effects of economic growth and innovation that will happen and that then corresponding to that there will be hiring blooms quite honestly I think all over the place

And then again go back to the fact that this is all happening in the face of declining population growth and increasingly population shrinkage. So human workers in many, many, many countries over the next you know 10, 20, 30 years are going to be at more and more of a premium, literally because you’re going to have shrinking population levels.

[While] we don’t really want to get into you know politics particularly but it does feel like the world broadly is going to reverse course on the rates of immigration that we’ve had for the last 50 years. it seems to be kind of a broad-based thing happening – rise in nationalism, concerns about the rate of immigration – and immigration historically in countries like the US ha ebbed and flowed over time based on how the national mood shifts.

And so in a country like the US (or any country in Europe), if you combine declining population with less immigration, the remaining human workers are going to be at a premium not at a discount. And so I think that the combination of faster productivity growth, faster economic growth, and then slower population growth and less immigration – actually means there’s going to be much less of this kind of dystopian/no-jobs thing. I just think it’s probably totally off-base. 

“That is extremely interesting. So, what I’m hearing is you’re not super worried about job loss. Is the key here that the timing kind of just works out, this population decrease, you know, like all these kind of have to line up for there not to be this massive job loss with AI?”

Andreessen replies (emphasis ours): 

Yeah.

Well, look, if we didn’t have AI, we’d be in a panic right now about what’s going to happen to the economy. Right? Because what we what we’d be staring at is a future of depopulation and depopulation without new technology would just mean that the economy shrinks. Right? 

So it would mean that the economy kind of itself kind of shrinks over time, the opportunity diminishes, and there are no new jobs, there are no new fields. There’s no new source of consumer demand for spending on things. And so you would be very worried about going into period of severe decline or stagnation.

Essentially you’d be looking at these very dystopian scenarios of like an economy self-euthanizing over time. 

So you’d be very worried about the opposite of what everybody thinks that they’re worried about. The only reason we’re not worried about that is because we now know that we have the technology that can substitute for the lack of population growth and also for the for the lack of immigration that’s likely.

And so, I would say the timing has worked out miraculously well in the sense that we’re going to have AI and robots precisely when we actually need them, to keep the economy from actually shrinking. 

And that’s just like a fundamentally good news story.

To get to the mass-job-loss thing that people are worried about, you’d have to look at like far, far, far higher rates of productivity growth. You’d have to look at rates of productivity growth that are 10, 20, 30, 50% a year – something like that – which are orders of magnitude higher than we’ve ever had in any economy in the history of the planet.

It’s possible that we get that. I mean, look, I have my utopian temptation along with everybody else.

If AI radically transforms everything overnight, then maybe… let’s play out the kind of utopian scenario. 

You get to a much higher level of productivity growth.

You get to a much higher level of technological change.

Corresponding to that you’ll have a massive economic boom. 

You’ll have massive growth in the economy and then corresponding with that you’ll have a collapse in prices. 

And so the price of goods and services that are affected by (or commoditized by) AI will collapse.

There’ll be price deflation and then as a consequence of price deflation everything that people are buying today gets a lot cheaper and that’s the equivalent of a gigantic increase in wealth right across the society.

This is actually worth talking about because people I think people get kind of sideways on this issue.

So if AI is going to transform the economy as much as the utopians or dystopians (or whatever kind) think that it will, the necessary economic calculation of what happens is massive productivity growth. 

The consequence of massive productivity growth literally means mechanically more output requiring less input, right? 

So you get more economic output for less input, right? So you’re substituting in AI for human workers.

And as a consequence, you get like this massive boom in output with much lower input costs. 

The result of that is you get lots of goods and services in all those affected sectors. The result of those gluts is you get collapsing prices, right? 

The collapsing prices mean that the thing today that cost you $100 now cost you $10 and now cost you $1.

That’s the equivalent of giving everybody a giant raise, right? 

Because now they have all this additional spending power. 

That additional spending power then translates to economic growth, right? 

The development of new fields. Everybody’s materially much better off very quickly. And then by the way, to the extent that you do have unemployment coming out the other side of that, it’s now much cheaper to provide the kind of social safety net to prevent people from being immiserated, right? 

Because the prices of all the goods and services that a welfare program has to pay from, they’re all collapsing, right? And so the price of healthcare collapses, the price of housing collapses, the price of education collapses, the price of everything else collapses because of the incredible impact that AI is having. 

And so in this kind of utopian/dystopian scenario that people have, there’s no scenario in which everybody’s just poor. In fact, it’s quite the opposite.

Everybody gets a lot richer because prices collapse and then it’s actually much easier to pay for the social safety net for the people who, for some reason, can’t find a job.

And so, maybe we end up in that scenario. 

I mean, the optimistic part of me says, yeah, maybe AI is that powerful and maybe the rest of the economy can actually change to accommodate that and maybe that’ll happen.

But the result of that is going to be a much better news story than people think it’s going to be. 

Everything I’ve just described, by the way, is just a very straightforward extrapolation on very basic economics. I’m not making any like bold predictions in what I just said. This is just a straightforward mechanical process that plays itself out if you have higher rates of productivity growth, which are necessarily the results of higher rates of technological growth.

And so, to be clear, I think we’re looking at a world that’s not like radically transformed the way that maybe the utopians think that it will be or the dystopians think it will be. 

I think it’ll be more incremental.

But I think that incremental shift is overwhelmingly going to be a good news process. And then even if it’s much faster, it’s also going to be a good news process. It’ll just be a good news process in the other way that I described.