Authored by Lance Roberts via RealInvestmentAdvice.com,

$397 billion. That’s how much “Buffett cash” now sits on Berkshire Hathaway’s balance sheet after Greg Abel’s first quarter as CEO. Warren Buffett left $373 billion behind when he stepped down at the end of 2025. Three months later, after Abel’s debut earnings report on Saturday, the hoard had grown by another $24 billion. The figure is bigger than the GDP of Hong Kong or Norway. It exceeds the market value of every American corporation except a tiny handful of mega-cap names. And it earned roughly four to five percent in Treasury bills while the S&P 500 ripped through three of its best consecutive years in modern history.

That Buffett cash hoard has also created a lot of speculation, innuendo, and assumptions, which is what I want to walk through in today’s discussion. Primarily, what that cash hoard actually represents, the popular theories explaining it, and what it really costs shareholders to hold.

The headline cash hoard number is striking on its own. Berkshire Hathaway ended Q1 2026 with a record $397.4 billion in cash and short-term Treasury bills, surpassing the prior $381.7 billion peak set in Q3 2025 and adding another $24 billion to what Buffett left behind. Of that, roughly $52 billion sits in plain cash and equivalents, with the bulk parked in Treasury bills earning short-term yields. By the time Abel released his first quarterly print on May 2, Berkshire was one of the largest holders of US Treasury debt in the world.

This wasn’t an accident. Between 2022 and 2024, Berkshire sold a net $172.93 billion in equities, with $134.1 billion of that coming in 2024 alone. Buffett trimmed his Apple position from nearly 50% of the equity portfolio down to roughly 22%. He cut Bank of America by more than half. Berkshire stopped repurchasing its own shares for nearly two years, sitting out twenty-one consecutive months as the stock traded above what Buffett considered its intrinsic value. Buybacks finally resumed under Abel on March 4, 2026, but only at $234 million in Q1, a token figure against a balance sheet of this size. In Q1 alone, Berkshire sold another $24.1 billion in equities against $16 billion in purchases, a net $8.1 billion reduction that pushed the cash pile to its new record.

The selling was deliberate, sustained, and almost entirely contrary to the prevailing market mood. While CNBC anchors debated whether the AI revolution was just getting started, the world’s most patient investor was quietly heading for the exits. Abel, in his first quarter, did exactly the same thing.

The History Of Buffett’s Cash Hoard

Berkshire’s cash position has always been countercyclical. When markets get cheap, the pile shrinks. When markets get expensive, it grows. That pattern has held for decades, but the magnitude in this cycle is unlike anything we’ve seen before.

In 2014, Berkshire’s cash and Treasury position hovered around $63 billion. By 2019, it had grown to $128 billion as bull market valuations stretched higher. The pandemic crash in early 2020 drew Buffett out for a brief window, when he deployed capital into Occidental Petroleum and Chevron. Those deployments barely dented the larger trend, and by the end of 2022, Buffett’s cash hoard had only modestly receded to roughly $109 billion despite the bear market that year.

Then came 2023 and 2024. As the S&P 500 ripped through gains of roughly 26 percent and 25 percent in consecutive years, Buffett didn’t chase. He sold. The cash hoard nearly doubled in 2024 alone, climbing from $168 billion to over $325 billion. By Q3 2025, it crested at $381.7 billion before a slight deployment trimmed it to $373.3 billion at year-end. Then in Abel’s first quarter at the helm, the hoard climbed to a fresh record of $397.4 billion as Berkshire kept selling, kept compounding T-bill yield, and continued to find few large-scale opportunities at acceptable prices.

The shape of that chart isn’t a coincidence. It’s the visual representation of a value investor’s discipline meeting a market that increasingly didn’t offer value. And the bar that matters most now is the one on the right: the discipline didn’t end with Buffett’s retirement.

Theory Versus Reality

The financial press has spent the past two years generating theories about Buffett’s cash position, and Saturday’s record Q1 print has reignited every one of them. Some are reasonable. Most miss the structural drivers entirely. Let’s separate the popular narratives from the actual mechanics.

Theory: Buffett Was Calling A Crash

This is the most viral interpretation. The Oracle of Omaha sees a bubble. He’s positioning Berkshire to scoop up bargains when the market collapses. The Buffett Indicator, which compares total US market capitalization to GDP, reached its highest level in history at the end of Q1 2026.

The math behind the indicator is straightforward. Take the total market value of all US publicly traded equities, divide by US nominal GDP, and you get a single ratio that Buffett himself called in a 2001 Fortune interview “probably the best single measure of where valuations stand at any given moment.” With Q1 2026 nominal GDP at $31.86 trillion (BEA advance estimate, released April 30, 2026) and total market capitalization near record highs, the ratio has surpassed every prior peak in the data series.

Two readings matter at this moment. The Federal Reserve’s broader corporate equities measure, divided by GDP, is roughly 232%, the highest level on record. The narrower Wilshire 5000 measure divided by GDP comes in at approximately 215%. Both versions are in record territory. Both are roughly two standard deviations above their long-term trend lines.

There’s some truth in the crash-call interpretation. Buffett has openly cited valuation discipline in his shareholder letters, and Abel echoed that language Saturday when he told shareholders Berkshire “can move it from insurance to non-insurance, into equities, or if we so choose, to hold it in cash.” But framing either of them as a market timer misreads the process. They don’t sell because they predict a crash. They sell because they can no longer find prices that justify the underlying business economics. Those are different statements that happen to look identical from the outside. The indicator above is consistent with the decision to stop buying. It’s not the same as a forecast that the market will fall next quarter.

Theory: Buffett Lost His Edge

The narrative that Buffett, at 95, simply couldn’t keep up with a bull market led by technology gained traction during 2023 and 2024. Berkshire trailed the S&P 500 in both years. Berkshire has now trailed the index by more than 30 percentage points since Buffett signaled his plan to step down last May. The Magnificent Seven were running, AI was the dominant story, and Berkshire’s portfolio looked stodgy by comparison.

However, I’ve heard this critique my entire career. It was wrong every previous time, and I’d argue it’s wrong now. Buffett’s framework is the same one he used in 1969, 1999, and 2007. The framework doesn’t fail. The market environments that cause its short-term underperformance are themselves brief and mean-reverting. And Abel’s decision to keep selling in his first quarter signals the framework isn’t going anywhere.

Reality: Berkshire Is Too Big For Its Own Process

Here’s the part that doesn’t make headlines but matters most. Berkshire’s market cap is now approaching $1 trillion. Buffett has said for years that “there remain only a handful of companies in this country capable of truly moving the needle at Berkshire.” When you need to put $50 billion or more to work in a single position to move the dial on a balance sheet that size, your universe of investable opportunities shrinks dramatically.

Add in the 20% takeover premium that Berkshire would have to pay to acquire any meaningful target, and the math gets brutal. A potential acquisition trading at 22x forward earnings quickly becomes 26x or 27x after the premium. That’s not a value investment, but rather a momentum trade dressed up in a board resolution.

Reality: Treasury Bills Were Paying You To Wait

The single most overlooked factor in this entire conversation is yield. From 2023 through most of 2025, short-term Treasury bills paid roughly 4-5%. That’s nothing. Berkshire generated about $8 billion in interest and other investment income in just the first three quarters of 2024, compared to $4.2 billion in the same period of 2023. Q1 2026 operating earnings just printed at $11.35 billion, up 18% year over year, with insurance underwriting profits up 28%. Net income more than doubled to $10.1 billion. The cash isn’t just sitting there. It’s compounding while it waits.

When cash itself produces a real return, the opportunity cost of waiting collapses. That’s a structural change from the 2010 to 2021 environment, when zero-rate cash was a guaranteed loss relative to any positive-return asset. The hoard wasn’t growing only because Buffett was selling and Abel kept selling; it had been compounding all along.

What The Cash Hoard Cost Shareholders

This is the part of the analysis no one wants to do, honestly. So let’s do it.

If we take the cash position averaged across 2023, 2024, and 2025, roughly $250 billion blended over the three years, and ask what that capital would have earned in the S&P 500 versus what it actually earned in Treasuries, we get a meaningful number. The S&P 500 returned approximately 26% in 2023, 25% in 2024, and 16% in 2025. Compounded against the average cash position, a hypothetical S&P 500 deployment would have produced roughly $155 billion in gains over the three years. The actual Treasury bill earnings on that cash came to about $34 billion. The forgone gain was approximately $125 billion.

That’s a real number. By any reasonable measure, holding that much cash during a sustained bull run costs Berkshire shareholders meaningful upside relative to a hypothetical fully invested alternative. The trailing 12 months tell the same story. Berkshire’s Class A shares have lagged the S&P 500 by a meaningful margin over the past year as the index has continued to grind higher, and Saturday’s earnings reaction was muted despite the operating beat.

Comparing Berkshire to the S&P 500 understates what a strict value framework actually missed during this cycle. The S&P is a blended benchmark. The basket Buffett genuinely sat out was the mega-cap growth complex. The cleanest investable proxy for that basket is the Vanguard Mega Cap Growth ETF (MGK), a fund built around the largest US growth names. It captures the Magnificent Seven and the broader leadership in AI names that drove the bulk of index returns from 2020 forward.

Looking at the ten-year price-return comparison anchors the cost differently. Over the period from May 2016 through April 2026, BRK.B delivered approximately 237% in cumulative price appreciation, while MGK returned roughly 398%. That’s a CAGR gap of about 4.5 percentage points per year, compounded across a full decade.

The chart above isn’t an indictment of Buffett, but rather a mirror. The companies that drove the spread, Nvidia, Microsoft, Apple at peak weighting, Alphabet, Meta, and Amazon, are precisely the ones Buffett either never owned in size or began trimming aggressively. The same discipline that has produced his long-term track record kept Berkshire underweight the very basket that won the decade. Whether that discipline is vindicated by an extended period of mean reversion or whether the mega-cap growth basket continues to compound at premium rates is the open question. The answer matters more for Abel’s first three years than almost any other variable he inherits.

Here’s where the analysis usually stops. It shouldn’t.

The calculation of the opportunity cost of Buffett’s cash assumes Berkshire could have deployed $397 billion into the S&P 500 at index returns. That’s a fantasy. Berkshire doesn’t allocate to index funds, even though Buffett often recommends that individual investors do. The mandate is to buy entire businesses or substantial equity stakes in great companies at fair prices. By 2024, those opportunities at Buffett’s required hurdle rate had effectively disappeared. Q1 2026 confirmed that Abel inherited the same problem.

The chart above isn’t an indictment of Buffett, but rather a mirror. The companies that drove the spread, Nvidia, Microsoft, Apple, at peak weighting, Alphabet, Meta, and Amazon, are precisely the ones Buffett either never owned in size or began trimming aggressively. The same discipline that has produced his long-term track record kept Berkshire underweight the very basket that won the decade. Whether that discipline is vindicated by an extended period of mean reversion or whether the mega-cap growth basket continues to compound at premium rates is the open question. The answer matters more for Abel’s first three years than almost any other variable he inherits.

Here’s where the analysis usually stops. It shouldn’t.

The calculation of the opportunity cost of Buffett’s cash assumes Berkshire could have deployed $397 billion into the S&P 500 at index returns. That’s a fantasy. Berkshire doesn’t allocate to index funds, even though Buffett often recommends that individual investors do. The mandate is to buy entire businesses or substantial equity stakes in great companies at fair prices. By 2024, those opportunities at Buffett’s required hurdle rate had effectively disappeared. Q1 2026 confirmed that Abel inherited the same problem.

The relevant counterfactual isn’t “S&P 500 returns minus Treasury yields.” The relevant counterfactual is what equities Berkshire could have actually bought, in the size it needed, at prices the team would defend in an annual letter. That set was very nearly empty in 2024. It remains nearly empty today.

There’s a second issue. Buffett’s actual track record requires you to measure performance over full cycles, not just the rising part of one. In 2022, when the S&P 500 fell 18%, Berkshire gained 4%. The cash looks like a drag in a bull market. However, it becomes the most valuable asset in the conglomerate’s portfolio when the cycle turns. Abel inherits that firepower at a moment of historically extreme valuations across the S&P 500. He used his first quarter to grow it rather than spend it. The full accounting will require seeing what he does with the dry powder over the next two to three years.

What This Means For Your Portfolio

If you’re managing your own money, the temptation is to map Buffett’s actions directly onto your situation. That’s a mistake. You’re not Berkshire or Warren Buffett. You don’t have a $1 trillion balance sheet, a 100+ year portfolio duration, and you don’t need to deploy $50 billion to move the needle. However, you can buy a $10,000 position in a great company without distorting the price of that company’s stock.

What you can take from this is more philosophical.

• Yes, valuation matters. The S&P 500 entered 2026 at one of the most expensive starting points in history, with a CAPE ratio above 40 and a forward P/E that historically correlates with poor 10-year forward returns. Buffett’s cash position was a market signal even if it wasn’t a market call.

• Sequence-of-returns risk is also real, especially for retirees or those approaching retirement. A market correction in the early years of retirement does permanent damage to a portfolio that a 30-year-old can absorb without consequence. Building a cash buffer when valuations are extreme is sound risk management, not market timing.

• And finally, discipline beats fear of missing out. Every cycle produces a chorus of voices arguing that valuation no longer matters because of some structural innovation. In 1999, it was the internet. In 2007, it was the new financial alchemy of structured credit. In 2024, it was AI. The names change. The discipline that protects capital across cycles does not.

Regardless of where you align, the next two years will tell us whether the $397 billion cash hoard was the most prescient capital allocation decision of the cycle, or whether Abel will eventually validate the critics by paying up for assets Buffett refused to chase. His first quarter answered the immediate question. He kept selling, kept the discipline, and he let the cash hoard grow. I have my view on what comes next. The data, the discipline, and the sixty years of history all point in the same direction.

But I’ve been wrong before, and so has Buffett. We’ll find out together.

Summary

• US denies earlier Tasnim report of agreeing to lift oil sanctions during talks.
• Trump calls for Iran’s total military surrender in Monday morning Truth Social post.
• Oil rebounds on Tasnim reporting Iranian denial: Tehran “under no circumstances” will negotiate nuclear issue as part of an end to the war.
• A flurry of (the somewhat typically-timed) Monday opener headlines have pushed oil prices lower, erasing weekend gains, including Al Arabia reporting that Iran is ready to accept a long-term nuclear freeze, instead of full dismantling.
• Iran has submitted its latest proposal comprising 14-points through Pakistan, amid reports that the US has offered to lift sanctions on Iranian oil during the interim negotiating period.
• Reports further add that Russia’s offer to take and hold Iran’s enriched uranium stockpile on its territory is being taken seriously.

*  *  *

US Denies Tasnim Report It Agreed to Lift Iran Oil Sanctions

And the denials keep rolling in. First via CNBC:

A U.S. official tells me the Iranian state media report that the U.S. has agreed to lift oil sanctions while talks are ongoing is false. https://t.co/gOcyBKDAxC

— Megan Cassella (@mmcassella) May 18, 2026

…as the US side does not seem very confidently in control of the situation – quite the opposite:

Senior U.S. official: “It’s time for the Iranians to throw bit of candy out. We need some real, sturdy, and granular conversation [regarding the nuclear program]. If that’s not gonna happen, we will have a conversation through bombs, which will be a shame” https://t.co/qTNrY1fgoN

— Barak Ravid (@BarakRavid) May 18, 2026

Just like that, back to square zero once again we go… and back to headline roulette. 

US PLANS NEW RUSSIAN OIL WAIVER AS IRAN WAR CRUNCHES SUPPLIES

US DENIES REPORT IT AGREED TO LIFT IRAN OIL SANCTIONS: CNBC

Steady climb in oil continues on the denials…

Trump Monday Morning Truth Social ‘Threat’

Like clockwork, the start of the week threat from Trump on TS… same as the old threats:

And bearish news via Axios:

Iran has given an updated proposal for a deal to end the war, but the White House believes it is not a meaningful improvement and is insufficient for a deal, a senior U.S. official and a source briefed on the issue told Axios.

Oil Quickly Rebounding on Iranian Denial

In a far too familiar pattern, just before US market open on Monday, a slew of optimistic Iran headlines saw oil erase weekend gains, which mostly came through Saudi Arabia’s state-funded Al Arabiya, as well as Reuters… only to be followed by Iranian officials rejecting the substance of these reports, putting things firmly back at square one. 

Tasnim has newly cited Iranian government sources who seek to make clear that “Iran under no circumstances” will engage in new nuclear negotiations for an end to the war. Contradicting the earlier morning reports, it still sees negotiations to find peace in the war with the US as separate from the nuclear file. “Fundamental differences between the Iranian and American texts still remain”, Tasnim reports, citing a source.

“Despite some changes in the new American text, fundamental differences stemming from the Americans’ exaggeration and lack of realism remain,” Tasnim writes, citing the Iranian source. According to more of the statements per state media:

• “Iran will not abandon its firm and principled positions on ending the war and realizing the rights of the Iranian people”.
• “Iran’s frozen assets must be returned to the Iranian people in a transparent and definitive manner, and paper promises are of no use”.
• “Despite some promises, there is disagreement about the return of the frozen funds”.
• “Iran’s determination regarding the necessity of paying compensation by the Americans for the military aggression against Iran is very serious”.
• “The Americans are far from Iran’s demands regarding its amount and some other issues.”
• “the Americans are still trying to tie the negotiations to end the war to the nuclear issue, which is against logic and Iran will not agree to it. The Americans must understand that Iran will in no way agree to an end to the war in return for nuclear commitments”.
• “Iran has not and does not have any intention of building nuclear weapons, and this claim is just an excuse and deception by the Americans. This issue has also been emphasized in the new text”.

Oil reacted as expected to this official ‘denial’ of the prior optimism – quickly rebounding, also as Trump is said to be “losing patience” with the progress of talks. A US source has told Al Jazeera Iran has “days not weeks” to show progress.

The optimism and then denials happened within a span of a couple hours…

And here is the walkback, as IRGC must have just gotten the memo:

DESPITE SOME CHANGES IN THE NEW AMERICAN TEXT, FUNDAMENTAL DIFFERENCES STEMMING FROM THE AMERICANS’ EXAGGERATION AND LACK OF REALISM REMAIN https://t.co/3KT4OeLhCq

— zerohedge (@zerohedge) May 18, 2026

Tasnim: Another Iranian Ship Breaks Through US Blockade Line

Iranian state media is claiming that a Iranian oil tanker under US sanctions that was off the coast of India two weeks ago has now docked at Kharg Island, having broken through the US naval blockade. Tasnim reports that “the LPG tanker passed through the US blockade line undetected and entered Iranian waters.” 

The Pentagon has been asserting an essentially airtight blockade on ‘illicit’ ships going to or from Iranian ports. CENTCOM has said it has turned around at least 75 vessels, while Iranian media has since the blockade’s start touted several ships making it through.

Long-Term Nuclear Freeze on Table

Saudi state-owned Al Arabiya early Monday has issued a bombshell if true (but still very much not officially confirmed), reporting that Iran has agreed to a long-term nuclear freeze instead of a complete dismantling. The outlet also reports that Iran has withdrawn its demand for compensation, instead demanding economic concessions. However, this could be highly dubious, given over the past several days Tehran has not shown willingness to back down from this demand of compensation.

It also seems Russia’s offer to take and temporarily hold Iran’s enriched uranium is being taken seriously. Here are the alleged “leaks” of the working draft peace document:

• Working on a condition transfer of enriched uranium to Russia instead of the US.
• Seeking multiple international guarantees for any agreement.
• Wants Pakistan and Oman to have a ‘role’ in any ‘clash’ in the Strait of Hormuz.
• Seeking a political formation that allows Iran to save face.
• Separate the maritime route from nuclear issues.

Oil pushes lower on the additional headlines, following initial reports that the US would lift sanctions on Iranian oil during the negotiating period…

As a reminder from days ago: “US President Donald Trump said Friday that he would accept a 20-year suspension of the uranium enrichment at the heart of Iran’s rogue nuclear program if Tehran gave a “real” guarantee, in an apparent shift from his previous demand that Iran permanently halt its program and his pledge to ensure Iran can never attain nuclear weapons.”

US Lifting Oil Sanctions During Negotiation Period: Tasnim

Tasnim news agency says Iran has submitted its latest proposal comprising 14 points through Pakistan. State sources say the focus by Iranian leadership is to end the war and build trust. This as Pakistan’s interior minister has extended his Tehran visit for a third day.

In this context a source close to the negotiating team reportedly told Tasnim that, unlike their previous texts, Washington agreed in the new text to lift Iran’s oil sanctions during the negotiation period. This is a first big sign of progress since the White House reportedly sent five ‘counter’ conditions to Tehran, which only offered a partial sanctions reduction.

Per more from Tasnim: 

• Waiving sanctions means temporarily lifting sanctions.

• Iran insists that lifting all sanctions on Iran should be part of the US’s commitments.

• However, the US has proposed suspending OFAC until a final understanding is reached.

The headline was enough to push oil down, erasing the gains over the weekend…

Another blurb via TASS, offering a little more in terms of likely conflicting interpretations and expectations:

According to the source, unlike in its previous proposals, the US has agreed in its new offer to suspend oil sanctions against Iran for the duration of the talks. The source noted that Tehran, for its part, insists on the lifting of all sanctions, while Washington is only ready to waive US Treasury sanctions until a final agreement is reached.

More Latest Developments

According to more of the latest headlines via Al Jazeera:

• Iran’s Foreign Ministry spokesperson says talks between Iran and the US are continuing through Pakistan.
• He added that Iranian and Omani technical teams met in Oman to negotiate a mechanism for ensuring safe transit in the Strait of Hormuz.
• Kuwait and Qatar have condemned drone attacks on Saudi Arabia, which officials say originated from Iraqi airspace.
• The Israeli army says it struck more than 30 targets in southern Lebanon, which it claims were used by Hezbollah to attack Israeli forces.
• The Israeli navy has seized vessels that were part of the Gaza-bound Global Sumud Flotilla, arresting 100 activists on board.

And more developments via Newsquawk:

• US President Trump warned on Truth Social that the clock is ticking for Iran and that they better get moving fast, or there won’t be anything left for them, and that time is of the essence.
• US President Trump declined to give a specific deadline for negotiations with Iran and will hold a Situation Room meeting with his national security team on Tuesday to discuss possible options for military action, while he spoke with Israeli PM Netanyahu about the situation in Iran, according to Axios. Trump also stated that he still thinks Iran wants a deal and he is waiting for an updated Iranian proposal, which he hopes will be better than the prior offer. Furthermore, Axios’s Ravid reported that Trump threatened that attacks would resume with greater intensity if the Iranian regime does not come up with a better proposal, while Channel 12’s Kraus posted that President Trump said in a phone call that he thinks the Iranians should be afraid of what’s going on right now.
• Pakistan shared revised Iranian proposal to end the war with the US on Sunday night, according to Pakistani sources. The course added that “we don’t have much time”, adding that both countries “keep changing their goalposts”.
• Western sources say the new Iranian proposal includes a commitment of unclear value not to produce nuclear weapons but no mention of uranium or Hormuz, according to Journalist Segal.
• Iranian Foreign Ministry Spokesperson Baghaei said talks with the US continue through Pakistani mediation. The spokesperson added that they have made great efforts for safe movement and protection of the Strait of Hormuz and are in constant contact with Oman to develop a mechanism. On Uranium, Baghaei said Tehran does not need any party to recognize its right to uranium enrichment and will not discuss during negotiations with the US.
• Iranian Defence Ministry spokesman Brigadier General Reza Talaei-Nik warned of a regretful response to enemies and said that Iranian armed forces are fully prepared to confront any potential attack by the US and Israeli regime, according to IRNA.
• Iranian Major General Rezaei said Iran is serious about diplomacy and negotiations, but is more serious about dealing with the aggressor, while he added that the US must now prove its good intentions and that Iranian armed forces are on the trigger as diplomatic efforts continue.
• Iran said transit through the Strait of Hormuz would flow again once its conflict with the US and Israel is over, although the sides remain far from resolving their differences, according to Bloomberg. In relevant news, three cargo-empty, US-sanctioned tankers reportedly slipped through the US naval blockade in recent days, according to TankerTrackers.com.
• Israel said it carried out a Gaza strike targeting the de facto head of Hamas’s armed wing, while Israel also conducted an airstrike on the towns of Froun, Kfar Hounah and Zawtar al-Sharqiya in southern Lebanon. Furthermore, an Israeli air strike targeted Baalbek, Lebanon and killed an Islamic Jihad commander and his daughter.
• UAE officials said a drone attack set off a fire near the UAE’s nuclear power station, while it was still investigating the source of the attack.
• Saudi Defence Ministry said it intercepted three drones launched from Iraq after entering the kingdom’s airspace.

* * *

While a Pakistani-mediated ceasefire managed to take effect on April 8, subsequent talks in Islamabad completely collapsed, but then President Trump later extended the truce indefinitely, likely to buy time and to figure out “what’s next” – while seeking a complete blockade of Iranian oil exports, and of all vessels entering or exiting Iranian ports. Currently the sides are merely trying to get back to the table.

Earlier today, in response to news that the number of tankers anchored at Iran’s Kharg Island oil terminal had hit a post-blockade peak, we wondered if this means that Iran is running out of tankers to store oil, i.e., Trump’ blockade of the blockade is working. In any case, it certainly means that Iran is no longer able to sell any of the oil, depriving it of much needed oil export revenues which it has found itself forced to shut in as there is no open downstream path for the product.

Tanker Tally at Iran’s Kharg Island Hits Post-Blockade Peak: BBG

Running out of tankers to store oil.

— zerohedge (@zerohedge) May 18, 2026

A few hours later, Bloomberg echoed question, writing that Iran’s main oil export facility in the Persian Gulf stayed devoid of tankers for at least a 10th day, underscoring the growing strain on Tehran from a US naval blockade.

Using Sentinel satellite data of Kharg Islan, Bloomberg found that since May 8, no loadings of large ocean-going tankers are visible at the facility’s crude-export berths. 

The counter blockade is depriving Tehran of critical petroleum revenue and the market of millions of barrels of supply. Prior to the US blockade, Iran was by far the largest – if not only – country exporting its crude because the Islamic Republic had blocked other countries’ ships from using the strait.

With no loaded tankers departing Kharg even as oil keeps arriving at the country’s largest oil terminal, it remains unclear how much of a factor lack of spare capacity has become as Trump hopes to cripple Iran’s oil production with lenghty shut-ins. Bloomberg’ Julian Lee writes that it’s hard to say the speed at which Kharg’ remaining capacity might fill given that Iran has curbed its output in response to the American blockade.

One possibility is that it’s cheaper for Tehran to use on-land facilities rather than filling ships, something that might help to explain the absence of loadings and a simultaneous buildup of tankers in nearby anchorage areas.

Here, Bloomberg’s other energy analyst Javier Blas chimes in, and notes that Iran is still loading crude into tankers (although not in Kharg Island). Instead, it’s loading a tanker at Jask, an alternative terminal outside the Strait of Hormuz. But since it is inside the US Navy blockade line, those tankers are likely only being used for storage purposes. 

An image on Monday from the European Union’s Sentinel 1 satellite, examined by Bloomberg, shows a ship moored at Jask’s loading buoy. A separate image from the Sentinel 2 orbiter from Sunday shows an Aframax-sized vessel heading toward the mooring.

Iran is still loading crude into tankers — although (not right now) in Kharg Island. Instead, it’s loading a tanker at Jask, an alternative terminal outside the Strait of Hormuz (but inside the US Navy blockade line).

Left May 17 🛰️Sentinel-2; right, May 18 🛰️Sentinel-1 pic.twitter.com/iU2o6YXAmD

— Javier Blas (@JavierBlas) May 18, 2026

Vessel-tracking data compiled by Bloomberg identify the tanker as the Vernon, a ship that has been sanctioned by the US for its involvement in Iran’s oil trade. It remains to be seen if the ship will attempt to get through the American cordon.

There were no telephone or email contact details for the Panama-based company listed as the ship’s beneficial owner and manager on the Equasis maritime database, while emails to the ISM manager, based in Hong Kong, were returned as undeliverable

While Tehran appears to have shifted its primary loading terminal from Kharg to Jask, loading at Jask remains uncommon. The port has seen only nine carriers filled since the terminal was officially opened in 2021. Of those, five have taken place since the war began at the end of February.

Up to Friday, the US Navy had redirected 75 Iran-linked commercial vessels and disabled a further four since it imposed its blockade on April 13, US Central Command said in posts on X last week.

Just 24 hours before Presidents Vladimir Putin and Xi Jinping are set to meet for their planned summit in Beijing, soon on the heels of Trump’s visit, and a geopolitical wrench may have just been thrown into the works.

According to Ukrainian President Volodymyr Zelensky, Russian forces have attacked a Chinese ship heading toward a Ukrainian port – a provocative move that threatens to seriously anger Beijing at the worst possible diplomatic moment.

Early Monday morning, a Russian drone reportedly struck the KSL Deyang, a vessel flying under the Marshall Islands flag, just off the coast of Ukraine, Reuters also confirms.

The ship was reportedly empty at the time while en route to Ukraine’s Pivdennyi port in the Odesa region to load up on iron ore concentrate.

A fire was observed on board, but it was quickly brought under control and extinguished, with the vessel escaping severe damage. 

The Ukrainian government is alleging this wasn’t some kind of accidental fog-of-war blunder, with President Zelensky immediately calling out Moscow:

“Drones struck Odesa … and one of the UAVs hit a vessel owned by China. The Russians could not have been unaware of what vessel was at sea,” Zelensky said.

A Ukrainian navy spokesman told AFP that none of the crew members, all Chinese nationals, were injured. He added that the vessel continued on its journey.

“The ship was entering for loading. After it was hit at night by a Shahed, the crew coped with the consequences on their own. Fortunately, no one was injured, and the vessel continued on its way to its port of destination,” navy spokesman Dmytro Pletenchuk said.

The incident went down just after on Sunday Xi and Putin had just exchanged “congratulatory letters” to set the stage for Putin’s upcoming arrival in Beijing. 

The China-owned vessel wasn’t the only ship attacked within that span of time. According to The Independent:

Russia attacked a Panama-flagged civilian vessel heading to Ukraine’s Chornomorsk port in the southern Odesa region on the Black Sea early on Monday, the regional governor said.

It is one of several ships destined for Ukrainian ports that have been struck by Russian forces in the past day.

The vessel was damaged in the attack, which caused a fire, Governor Oleh Kiper said on the Telegram messaging app, adding that no one had been injured in the incident and that the crew had extinguished the fire. The vessel has continued on its way, the governor added.

TradeWinds is also suggesting a third ship was struck, but few details have been given. Black Sea transit continues to be a dangerous prospect, also with naval mines long being a feature of the 4+ year long war.

Update (1130ET): The DOJ announces that as a part of the settlement agreement in President Donald Trump v. the IRS, the Attorney General established “The Anti-Weaponization Fund” to provide a systematic process to hear and redress claims of others who suffered weaponization and lawfare.

“The machinery of government should never be weaponized against any American, and it is this Department’s intention to make right the wrongs that were previously done while ensuring this never happens again,” said Acting Attorney General Todd Blanche. “As part of this settlement, we are setting up a lawful process for victims of lawfare and weaponization to be heard and seek redress.”

“The use of government power to target individuals or entities for improper and unlawful political, personal, or ideological reasons should not be tolerated by any Administration,” said Principal Associate Deputy Attorney General Trent McCotter. 

Bloomberg reports that the fund will receive $1.776 billion and will come from the judgment fund, which is a perpetual appropriation allowing DOJ to settle and pay cases.

The fund will have the power to issue formal apologies and monetary relief owed to claimants.

The Fund will consist of a Commission of five members appointed by the Attorney General. One Member will be chosen in consultation with congressional leadership. The President can remove any member, but a replacement must be chosen the same way as the replaced member was selected.

*  *  *

As Tom Ozimek detailed earlier via The Epoch Times, President Trump’s attorneys on Monday filed a court notice voluntarily dismissing his $10 billion lawsuit against the IRS and the U.S. Treasury Department, in a case that accused the agencies of failing to prevent a former contractor from leaking Trump’s tax returns to the media.

No reason was stated in the May 18 motion, which asks the court to dismiss the case with prejudice, meaning Trump and the other plaintiffs cannot bring the same claims again in the future. A court filing in April indicated that talks were underway to settle the case, with the parties stating at the time that discussions were taking place “productively to avoid protracted ligitation.”

Monday’s filing said the IRS and Treasury Department had neither filed an answer nor moved for summary judgment, allowing the plaintiffs to dismiss the action unilaterally without requiring court approval or government consent.

Trump, along with two ​of his sons and the Trump ⁠family business, sued the IRS ​and the Treasury Department in January, accusing both agencies of failing to take mandatory precautions to prevent former IRS contractor Charles “Chaz” Littlejohn from illegally obtaining access to their tax records and disclosing that information to The New York Times and ProPublica.

The lawsuit alleged that Littlejohn had “staff-like access” to confidential tax return information and exploited weaknesses in IRS safeguards to obtain and leak the records between 2019 and 2020.

Lawsuit Details

The lawsuit, filed in the U.S. District Court for the Southern District of Florida, sought at least $10 billion in damages and accused the IRS and THE Treasury of violating federal privacy laws governing taxpayer information.

Trump brought the suit in his personal capacity, while Donald Trump Jr., Eric Trump, and the Trump Organization were also named as plaintiffs.

Littlejohn, who at the time was employed by defense contractor Booz Allen Hamilton, was accused of having improperly accessed and disclosed tax information related to Trump and affiliated entities, including business holdings.

The plaintiffs claimed Littlejohn’s actions caused “reputational and financial harm, public embarrassment, unfairly tarnished their business reputations, portrayed them in a false light, and negatively affected President Trump, and the other plaintiffs’ public standing.”

The lawsuit argued that IRS and Treasury safeguards were so inadequate that the agency took roughly 3 years to detect the breach.

“Defendants had a duty to safeguard and protect Plaintiffs’ confidential tax returns and related tax return information from such unauthorized inspection and public disclosure,” the complaint alleged, pointing to the need for the agencies to have in place appropriate technical, employee screening, and monitoring systems to prevent Littlejohn’s actions.

“Defendants failed to take such mandatory precautions.”

Littlejohn pleaded guilty in October 2023 to one count of unauthorized disclosure of tax return information.

Prosecutors said he used broad search parameters to conceal his activities, uploaded stolen data to a private website to avoid IRS monitoring systems, and stored records on personal devices before providing them to media outlets.

In January 2024, U.S. District Judge Ana Reyes sentenced Littlejohn to five years in prison, the maximum sentence permitted under the statute. Reyes described the breach as the “biggest heist” in IRS history.

“It cannot be open season on our elected officials,” Reyes said, noting that Littlejohn purposefully sought his job at least in part to obtain and leak tax information.

Before Monday’s voluntary dismissal, the case had appeared to be moving toward a possible resolution in recent weeks.

In an April 17 filing, attorneys for Trump and the Justice Department jointly requested a 90-day pause in proceedings to allow settlement negotiations to continue.

The IRS and THE Treasury Department did not immediately respond to requests for comment on the dismissal filing.

Confirming our Sunday preview, overnight China reported growth data which slowed across the board in April with investment resuming declines, retail sales missing sales and growing at the weakest rate in 4 years while industrial production rose at the slowest pace in three years, calling into question Beijing’s reluctance to add stimulus to the economy as a global energy crisis hits factories and consumers across the world.

China’s Monday data dump of official data on Monday painted a picture of an economy where booming exports no longer offset deteriorating consumption at home, prompting analysts at banks including Nomura and SocGen to urge bolder measures in support of growth.

As shown in the chart below, fixed-asset investment unexpectedly shrank 1.6% in the first four months of 2026 from a year earlier, while industrial production grew just 4.1% last month, the weakest in almost three years. Retail sales also missed forecasts and rose just 0.2% in April, the worst reading since they contracted in December 2022, when China reopened from Covid.

What is shocking is that it is common knowledge that Beijing traditionally massages its economic data to present itself in the rosiest possible light: the fact that it allowed data this ugly would suggest that the picture on the ground is much uglier. 

Goldman’s Delta One head Rich Privorotsky captured this sentiment well, writing this morning that “overnight news from China showed economic data materially below expectations. Industrial production, retail sales and fixed asset investment all missed meaningfully. It’s hard to tell whether this reflects genuine demand destruction but perhaps it helps explain how the oil market has managed to balance despite ongoing supply concerns. I genuinely can’t remember a period when Chinese data, which tends to be heavily massaged, missed by anything close to this magnitude. Negative read through for consumption related categories.“

Remarkably, not a single economist surveyed by Bloomberg had predicted as pessimistic a reading for industry, retail sales and investment. The disappointing performance of the world’s second-biggest economy last month is a reminder of its domestic vulnerabilities, after a global artificial intelligence investment boom sent trade soaring.

The breadth of the acute slowdown in April has put the prospect of a more aggressive stimulus back on the agenda after China stood out in its resilience to the fallout from the Iran war. The government pulled back on fiscal spending in March, while the central bank has steered clear of even hinting at any further loosening in policy, amid ample market liquidity and weak demand for credit. 

Fu Linghui, spokesman for the National Bureau of Statistics, described the deterioration of economic indicators as “a normal fluctuation from month to month.” But he also highlighted challenges such as a persistent imbalance between supply and demand as well as a complex global environment.

Investment plunged by around 8% in April from a year earlier, according to estimates from Goldman Sachs and Capital Economics, returning to a similar pace of decline seen in the second half of 2025. Manufacturing and infrastructure investment both weakened, while private investment plummeted

In response to the dismal data, Nomura economists wrote that authorities “might need to step up policy support for stabilizing growth,” adding that “Beijing has no room for complacency.”

A rising number of economists has been forecasting the People’s Bank of China won’t lower interest rates this year after the oil shock pushed up inflation expectations, though many still expect a cut to lenders’ reserve requirement ratio. The PBOC last lowered the policy rate and the RRR at the peak of the trade tensions with the US a year ago. 

Authorities are still likely to take a patient approach and avoid rushing out response to just one month of data. The Communist Party’s decision-making Politburo will convene in July to review economic growth and policies, making it the next potential window for any adjustment in stimulus. 

“The stance still seems to be to play cautiously,” said Jing Liu, chief economist for Greater China at HSBC in an interview on Bloomberg TV. “Our base case is no extra stimulus for the economy for the time being.”

Even though many manufacturers are struggling to cope with higher raw material costs, overall exports soared as Chinese tech products found willing buyers abroad. Greater demand for green energy products is also benefiting China. But a sustained weakening of investment and consumption at home could still bring risks to Beijing’s goal of achieving 4.5% to 5% artificial growth this year.

The April data suggest gross domestic product may expand as little as 4.1% on-year in the second quarter, which could prompt incremental policy easing, according to Macquarie Group Ltd. For now, Goldman is maintaining its forecast for a GDP gain of 4.7% in April-June, compared with 5% in the first three months of the year.

The data “should keep PBOC easing – RRR and even rate cuts – firmly on the table, while fiscal top-up may come later,” SocGen’s head China economist Wei Yao wrote in a note.

The plunging manufacturing data comes at a time of continued dismal credit demand and heavy rainfall in southern China, which could be behind the sharp fall in capital spending, Goldman economist Lisheng Wang said in a note (available to pro subs here).

Statistical adjustment is another potential factor. Many economists believe authorities took measures to correct over-reporting of the data in late 2025. Such a change may have exaggerated the volatility of the figures recently, as the on-year contraction in steel and cement output narrowed in April, according to Goldman Sachs. 

The consumer economy has meanwhile continued to struggle as households spent less on items as varied as autos and furniture. Car sales plunged 15% in April from a year earlier, the worst contraction since mid-2022, when the country was under Covid restrictions. The government has scaled back subsidies for electric vehicle purchases this year, while the Iran oil shock hurt sales of gasoline-powered cars. 

Purchases of home appliances and furniture — products that used to be buoyed by government subsidies — declined at a double-digit pace. Gold, silver and jewelry sales plummeted 21% — a huge reversal from earlier this year and 2025, when soaring prices for precious metals led to a speculative investment frenzy.

The industrial sector is also getting more lopsided as export-driven sectors lead the growth while industries that relied on domestic sales lagged. The production of electronics, lifted by soaring global demand for AI chips, expanded 15.6% in April, the fastest pace in two years.

The auto industry also expanded briskly at 9.2%, as overseas EV sales took off. Meanwhile, commodities linked to real estate and construction — such as cement, glass and steel — recorded declines, while crude oil processing volume fell, which ING Bank economist Lynn Song attributed to the war’s impact

Soaring chip prices may partly explain why factory output weakened even as exports surged.  While industrial production is reported after an adjustment made for inflation, sales abroad are calculated in nominal terms, making it hard to separate movements in prices versus volumes. Surging costs of chips and electronics accounted for about half of April’s 14% headline export growth, according to Nomura. 

“China still looks like a two-speed economy: strong in strategic manufacturing and exports, but weak where household confidence matters most,” said Charu Chanana, chief investment strategist at Saxo Markets in Singapore. “The concern is not just that activity missed, but that the weakness is broadening across the domestic side of the economy.”

There is one silver lining when it comes to the Chinese economy: exports are expected to remain strong after climbing 15% in the first four months from a year ago. Stabilizing trade ties with the US, reinforced by President Donald Trump’s visit to Beijing, further bolster the outlook.

But a turnaround is nowhere in sight for domestic consumption. Chinese households net repaid the most loans in April since comparable data going back to 2010.

“Policy space remains ample,” said Hao Zhou, chief economist at Guotai Junan International Holdings. “The April data are less a sign of deterioration than a trigger for more proactive easing — which should help anchor growth and support a gradual recovery into the second half of the year.”

The Russian Defense Ministry (MoD) announced Monday that its forces executed a massive missile and drone barrage across Ukraine, which is clearly the expected big retaliatory response following Ukraine’s large-scale drone wave attack on Moscow over the weekend.

Kremlin officials specifically described the new assault as indeed direct retaliation for “terrorist attacks” carried out by Kiev, which killed at least three in the Russian capital, injured dozens, hit a refinery, and unleashed havoc and fear among the population. The MoD said it targeted military and defense industrial sites, but Ukraine’s account differed.

Ukrainian forces had deployed at least 130 UAVs during the capital-bound raid, and damaged a major regional airport. Large fires were spotted near major roadways, sometimes in the heart of busy city areas.

Russia’s nighttime into early Monday retaliation has been expectedly fierce, as overnight it specifically targeted Odesa and Dnipro, leaving at least one person dead and over 30 injured. In the port city of Odesa, the drone strikes damaged residential buildings, a school, and a kindergarten, according to Ukrainian officials.

Ukrainian media chronicled some of the following:

• On Sunday, Russia carried out a combined overnight attack on the city of Dnipro, striking a residential area, sparking multiple fires, and causing casualties.
• According to the Ukrainian Air Force, Russian forces began launching drones toward Dnipro at approximately 8 p.m.
• On Monday, May 18, at 2:32 a.m., Ukraine was under threat of ballistic missile strikes. Shortly afterward, missiles were detected heading toward Dnipro, including both ballistic and cruise missiles.
• According to local authorities, Russian drones struck three residential buildings in Odesa’s Kyivskyi and Prymorskyi districts.
• One of the buildings, a single-story house in the Prymorskyi district, was completely destroyed. Other buildings sustained damage to facades, roofs, and windows. Several fires broke out but were quickly extinguished.

But Ukraine’s cross-border drones have also continued unabated, as two people were killed and two more were injured following a a Monday UAV attack on Russia’s southern Belgorod region, local authorities said. Belgorod has come under regular attack since near the start of the war, given its southern-most location, close to the front-lines to the south in Ukraine.

Meanwhile, Kremlin announced Monday that Moscow anticipates an eventual resumption of the Russia-Ukraine peace process, though it noted that negotiations are currently paused.

Kremlin spokesman Dmitry Peskov made the statement in response to comments from President Trump, who on Friday suggested that a Russian missile strike hitting a Kiev residential building had delayed progress toward ending the four-year conflict.

Per the Associated Press, “The death toll from a Russian missile attack that flattened a Kyiv apartment building rose Friday to 24, including three teenagers, Ukrainian President Volodymyr Zelenskyy said as he led the mourning for one of the deadliest attacks on the capital in the 4-year-old war.”

Цієї ночі росія атакувала #Одесу безпілотниками: є постраждалі

Внаслідок влучання виникла пожежі та руйнування в житлових будинках. Попередньо 2 постраждалих, з них – дитина. Пожежі ліквідовані.

Від ДСНС залучалися понад 80 рятувальників pic.twitter.com/hFM1dSqyei

— DSNS.GOV.UA (@SESU_UA) May 18, 2026

“The cruise missile hit the nine-story corner apartment block Thursday during what the Ukrainian air force said was Russia’s biggest barrage on the country of the full-scale invasion. Emergency workers finished digging through the rubble searching for victims after more than a day, Zelenskyy said on X,” the report adds.

But in response, Peskov emphasized that focus should also be directed toward persistent Ukrainian strikes targeting civilian infrastructure inside Russia. 

Authored by Steve Watson via Modernity.news,

The surveillance state has found its newest frontier: your car’s dashboard. What used to be a symbol of American freedom and independence is rapidly morphing into a high-tech cage that watches your every move and can override your decisions at will.

In a widely shared post on X, users detailed complaints pouring in about Subaru’s upgraded AI ‘EyeSight’ system now featured on the latest models. 

Drivers report the system pouncing on brief glances away from the road – while Biden-era federal mandates prepare to make this level of surveillance mandatory in every new vehicle by 2027.

Subaru has released a new “EyeSight system” on their new vehicles

Drivers who bought the cars are saying if you glance off the road for a second to look at the mountains, or change a song, the vehicle starts alerting

It will also stop the car by using its ‘Emergency Stop Assist… pic.twitter.com/o0uAgLm58r

— Wall Street Apes (@WallStreetApes) May 16, 2026

As the video highlights, even a momentary glance to change a song or take in the scenery triggers relentless alerts. The technology doesn’t stop there. 

Its new Emergency Stop Assist with Safe Lane Selection feature can detect what it calls an “unresponsive” driver, issue escalating warnings through sounds and steering wheel vibrations, and then take full control: automatically braking, slowing the vehicle, steering it to the shoulder, and activating hazard lights.

This isn’t some optional gimmick. It’s being rolled out as standard “safety” tech, but drivers are calling it exactly what it feels like – an overbearing electronic babysitter that treats competent adults like distracted children. 

It serves as a chilling preview of where the entire auto industry is headed under government pressure.

This kind of intrusive monitoring is precisely the tool a police state would dream of to exert total control over personal movement. If authorities gain deeper integration with these systems, they could effectively decide when, where, and if you get to drive at all.

The Subaru rollout is just the latest flashpoint in a broader push toward vehicle surveillance that goes far beyond basic safety. A federal mandate buried in the 2021 Infrastructure Investment and Jobs Act requires all new passenger vehicles sold in the U.S. to include advanced impaired-driving prevention technology starting with 2027 models. 

As detailed in reporting from the New York Post, this means infrared cameras and sensors constantly monitoring eyes, faces, head position, and behavior to detect distraction, drowsiness, or impairment – with the power to prevent the car from starting or limit its operation. https://nypost.com/2026/04/30/us-news/sinister-in-car-spy-tech-that-can…

Automakers are already patenting and deploying even more aggressive systems, including biometric scans that analyze everything from your gait to your heart rate. Privacy advocates warn the data won’t stay in the car – it could flow to insurers for risk scoring, law enforcement, or worse.

As we also recently highlighted, dystopian technology including AI face scanning, lip reading and emotion monitoring is being deployed in vehicles, as well as cross-checks for drivers against police databases before even allowing the vehicle to move. 

And authorities are already signaling their eagerness to weaponize these tools for broader travel restrictions. In Massachusetts, Democrats advanced a bill aimed at reducing statewide vehicle miles traveled to meet climate targets, pushing policies that critics say amount to limiting how far people can drive in their own cars. 

X users are reacting with the outrage this deserves, blasting the tech as the thin end of the wedge for total control:

Subaru just turned your car into a fvcking SNITCH. Look away for 2 seconds? BEEP BEEP, vibrate, and then it drives itself off the road like Karen on crack. Government wet dream 1984 Orwellian bullshit. 😒 Boycott these traitors. 🔥

— J. L. Hunter (@JLHunter1984) May 16, 2026

So, this thing will go off if you look into your mirrors or over your shoulder to see if it’s safe to take a turn, or change lane, or to brake. What a GREAT idea. Lets all tunnel vision on what’s in front of us and ignore everything else. What could possibly go wrong?

— sam (@donder172) May 16, 2026

Can only imagine what it would do if it knew you voted for a republican.

— Amos 9 Fifteen (@Amos467253) May 16, 2026

nice.

refuse to purchase a car like this.

simple as.

if they all go bankrupt, they will stop this shit. pic.twitter.com/8N5WQnMVyx

— HumanProbably (@HumanProbably2) May 16, 2026

It must be stopped and waiting for some genius aftermarket design to override. Kill it. Kill all surveillance that’s being rolled out. It must be destroyed.

— L. (@LisaFMRRN) May 16, 2026

Globalist climate agendas, big government overreach, and corporate-government collusion are converging to strip away the last vestiges of personal autonomy on the open road. What starts as “safety features” and “environmental goals” ends with your car deciding whether you’re allowed to leave your driveway.

Americans have always valued the freedom to get behind the wheel and go where they please without Big Brother riding shotgun. 

These prison pods represent the opposite vision – one of constant monitoring, automated intervention, and restricted mobility. 

The only real answer is rejection: refuse to buy these surveilled vehicles, support politicians who fight the mandates, and preserve the used car market as the last refuge of actual driving freedom.

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.

Looking at the week ahead, Nvidia’s earnings on Wednesday, with a market capitalisation now of $5.46tn, will be the main event. In economics, we have the global flash PMIs on Thursday, along with inflation data from Canada tomorrow, the UK on Wednesday, and Japan on Friday. From central banks, the highlight will be the FOMC minutes on Wednesday. Those flash PMIs will be important, as they’re one of the first indicators on how the global economy has performed this month, so will be scrutinized for any signs of how the war in Iran is impacting activity and prices.

The US calendar is relatively light, with the NAHB housing market index today expected to remain unchanged at a cyclically low 34, followed by Tuesday’s pending home sales, where a modest +1.0% increase is anticipated (from +1.5% previously). Attention will then turn to Thursday’s April housing activity data, where housing starts are expected to ease to an annualized pace of 1.425mn (from 1.502mn), while permits are projected to tick higher to 1.375mn (from 1.363mn). All estimates are according to our economists.

Beyond housing, Thursday is the key day for macro releases. The weekly initial jobless claims are expected to edge slightly lower to 209k (from 211k). The same day will also bring the Philadelphia Fed manufacturing survey, where our economists expect a pullback to +21.0 (from +26.7), alongside the flash PMIs. In the US, manufacturing is expected to soften marginally to 53.7 (from 54.5), while services are seen ticking up to 51.5 (from 51.0).

In contrast to consumer sentiment—which will see an updated reading of the Michigan survey on Friday (expected at 48.2 versus 49.8 previously)—business surveys have generally remained more resilient despite the energy shock. That said, some indicators have shown rising input costs and lengthening delivery times, developments that could signal renewed inflationary pressure building beneath the surface.

Turning to central bank communications, the Fed speaker slate is relatively limited but still notable. Governor Waller is scheduled to participate in an ECB policy panel tomorrow, alongside comments from Philadelphia Fed President Harker (voter) on the outlook. On Wednesday, Vice Chair Barr will discuss consumer financial health metrics, while the Fed will also publish the minutes from the April FOMC meeting. Richmond Fed President Barkin (non-voter) will follow on Thursday with remarks on the economy, before Governor Waller rounds out the week with a further appearance on Friday.

In Europe, the highlights will include the UK labour market report tomorrow and inflation data on Wednesday. DB’s UK economist expects headline CPI to slow to 2.98% YoY and core CPI to fall to 2.61% YoY. More detail and forecasts are in the full inflation spotlight note here. The UK will also release the GfK May consumer confidence index and April retail sales on Friday. Other notable European releases include Eurozone consumer confidence on Thursday and Germany’s Ifo survey on Friday.

In Asia, Japan faces a busy week, with key data including Q1 GDP tomorrow and April nationwide CPI on Friday. Our Chief Japan economist expects positive real growth of an annualised 1.3% QoQ for the GDP report and sees core CPI inflation, excluding fresh food, holding at 1.8% YoY, alongside a retreat in core-core inflation, excluding fresh food and energy, to 2.2% (from 2.4% in March). 

Finally, beyond Nvidia’s earnings on Wednesday, results are also due from major US retailers, including Walmart, Home Depot, and TJX.

Courtesy of DB, here is a day by day calendar of the week’s main events:

Monday May 18

• Data: US May New York Fed services business activity, NAHB housing market index, March total net TIC flows, China April retail sales, industrial production, investment, home prices, Italy March trade balance
• Central banks: BoE’s Greene and Mann speak
• Earnings: Baidu, Ryanair Holdings
• Other: G7 meeting of finance ministers and central bank governors (through May 19)

Tuesday May 19

• Data: US April pending home sales, UK March average weekly earnings, unemployment rate, April jobless claims change, Japan Q1 GDP, March capacity utilisation, Eurozone March trade balance, Canada April CPI, March building permits
• Central banks: Fed’s Waller speaks, ECB’s Lane and Makhlouf speak, BoE’s Breeden speaks
• Earnings: Home Depot, Amer Sports

Wednesday May 20

• Data: UK April CPI, RPI, PPI, March house price index, Germany April PPI, Denmark Q1 GDP
• Central banks: FOMC minutes, Fed’s Paulson and Barr speak, China 1-yr and 5-yr loan prime rates
• Earnings: NVIDIA, Analog Devices, TJX, Lowe’s, Intuit, Target, Experian, Marks & Spencer
• Auctions: US 20-yr Bonds ($16bn)

Thursday May 21

• Data: US, UK, Japan, Germany, France and Eurozone May preliminary PMIs, US May Philadelphia Fed business outlook, Kansas City Fed manufacturing activity, April housing starts, building permits, initial jobless claims, Japan April trade balance, March core machine orders, Italy March current account balance, ECB March current account, Eurozone March construction output, Q1 labour costs, May consumer confidence, Australia April labour force survey
• Central banks: ECB’s Villeroy speaks, BoJ’s Koeda speaks, BoE’s Taylor speaks
• Earnings: Walmart, Deere, Generali, Ross Stores, Take-Two, BT, Zoom, Workday
• Auctions: US 10-yr TIPS (reopening, $19bn)

Friday May 22

• Data: US May Kansas City Fed services activity, UK May GfK consumer confidence, April retail sales, public finances, Japan April national CPI, Germany June GfK consumer confidence, May Ifo survey, France May business confidence, Canada March retail sales, April industrial product price index, raw materials price index
• Central banks: Fed’s Waller speaks, ECB’s Vujcic, Kazimir, Muller and Lane speak
• Earnings: Cie Financiere Richemont, Lenovo

Taking a look at just the US, Goldman writes that the key economic data release this week is the Philadelphia Fed manufacturing index on Thursday. There are several speaking engagements with Fed officials this week, including events with Governors Waller and Barr and Presidents Paulson and Barkin. The minutes to the FOMC’s April meeting will be released on Wednesday.

Monday, May 18 

• 10:00 AM NAHB housing market index, May (consensus 34, last 34)

Tuesday, May 19 

• 08:00 AM Fed Governor Waller speaks: Fed Governor Christopher Waller will participate in a panel at the European Central Bank. Moderated Q&A is expected. On April 17th, Waller cautioned that higher oil prices as a result of the Iran war could lead to a “more lasting increase in inflation.” Waller noted that “if the risks to inflation outweigh those to the labor market,” that could require “maintaining the policy rate at the current target range.”
• 10:00 AM Pending home sales, April (GS +1.0%, consensus +1.0%, last +1.5%)
• 07:00 PM Philadelphia Fed President Paulson (FOMC voter) speaks: Philadelphia Fed President Anna Paulson will speak about the economic outlook at the Atlanta Fed’s Financial Markets Conference. Text and audience Q&A are expected. On March 27th, Paulson said that there was “a little bit more of a risk that the transmission of higher fuel prices, higher fertilizer prices, into inflation expectations is faster and maybe a little bit more durable.” That said, Paulson also noted that “for [all these shocks] to turn into sustained inflation, you need a mechanism that keeps that going” and that “on the wage-setting side, it doesn’t seem like there’s a lot of impetus that would make that happen now.”

Wednesday, May 20 

• 09:15 AM Fed Governor Barr speaks: Fed Governor Michael Barr will deliver a speech on consumer financial health at a conference in Atlanta, Georgia. Text is expected. On May 5th, Barr said that “the longer [the Iran war] goes on, the greater the risk that the inflation we’re seeing in these prices becomes embedded in the economy, and then we have to worry more.” Barr noted that “we’re in a situation right now where we really need to wait and see to understand what direction [the conflict] is going.”
• 02:00 PM FOMC meeting minutes, April 28-29 meeting: At its April meeting, the FOMC left the fed funds rate and the policy guidance in its statement unchanged. Presidents Hammack, Logan, and Kashkari dissented against the implicit easing bias in the standing policy guidance, while Governor Miran dissented in favor of a 25bp cut. Chair Powell said that the number of FOMC participants who could support moving to balanced guidance has increased since March and that the center of the FOMC “is moving toward a more neutral” outlook for future rate changes, but most felt making a change now was unnecessary. We pushed back our expectations for Fed cuts by one quarter to December and March. With energy cost passthrough likely to keep year-over-year core PCE inflation closer to 3% than 2% all year, we think that a combination of lower monthly inflation prints after the oil shock fades and further labor market softening will likely be needed for the FOMC to cut this year. We still expect that bar to be met but now expect it to take a bit longer.

Thursday, May 21 

• 08:30 AM Initial jobless claims, week ended May 16 (GS 210k, consensus 210k, last 211k); Continuing jobless claims, week ended May 9 (consensus 1,785k, last 1,782k)
• 08:30 AM Philadelphia Fed manufacturing index, May (GS 20.0, consensus 18.0, last 26.7)
• 08:30 AM Housing starts, April (GS -3.5%, consensus -5.5%, last +10.8%) 
• 09:45 AM S&P Global US manufacturing PMI, May preliminary (consensus 53.7, last 54.5); S&P Global US services PMI, May preliminary (consensus 51.0, last 51.0)
• 12:20 PM Richmond Fed President Barkin (FOMC non-voter) speaks; Richmond Fed President Tom Barkin will deliver a speech at the Urban Land Institute Triangle in Raleigh, North Carolina. Text and Q&A are expected.

Friday, May 22 

• 10:00 AM University of Michigan consumer sentiment, May final (GS 48.2, consensus 48.3, last 48.2); University of Michigan 5-10-year inflation expectations, May final (GS 3.4%, last 3.4%)
• 10:00 AM Fed Governor Waller speaks; Fed Governor Christopher Waller will deliver a lecture on the economic outlook at the Frankfurt School of Finance and Management in Germany. Text and moderated Q&A are expected.

Source: Goldman, DB

Downward momentum in South Korean stocks was halted on Monday as optimism returned to Samsung Electronics after the company and its union reopened talks to resolve contract disputes and avert a strike that could begin as soon as Thursday.

Bloomberg reported that the union’s leader would “sincerely engage” with Samsung executives. The world’s most important memory chip maker was also granted several requests by a Korean court, including orders to block the union from occupying company facilities.

The union is still threatening an 18-day walkout beginning Thursday unless its contract demands are met, but both sides signaled earlier today a willingness to resolve the labor dispute.

On Saturday, Samsung also made a concession by replacing its lead negotiator, while Prime Minister Kim Min-seok and Chairman Jay Y. Lee publicly urged compromise.

Shares of Samsung in South Korea closed up 3.5%, helping lift the country’s main equity index, KOSPI, after it had slid late last week on labor action fears.

Goldman analyst Christy Park told clients, “By now, one would know: any correction on Hynix & Samsung = Buy (*note Hynix shares corrected >1% only 5x times since April out of 30+ sessions in which at ALL times regained more than its losses immediately within the following 1~3 days).”

Park listed the catalysts for Samsung & Hynix:

• Resolution to the labor union strike removing overhang (Samsung; co replaced its entire negotiation team)

• Continued conventional memory pricing strength acting as a tailwind (Samsung has higher exposure vs. Hynix) 2027 HBM pricing upside given HBM now sold at a discount vs. conventional DRAM (both Samsung & Hynix)

• Upside in shareholder return given the substantial growth in FCF (Samsung: 2024-2026 shareholder return policy of paying back 50% of this)

• Potential ADR listing of Kioxia could be positive for Hynix sentiment (as Hynix owns a meaningful stake in Kioxia through a consortium) ADR listing of SK HYNIX (anticipated in July)

• We see Agentic AI driving a 24x jump in token consumption by 2030 (120 quadrillion tokens per month) (both Samsung & Hynix)

In a separate note, Tom Kang, director at Counterpoint Research, said, “There is a clear need for both sides to reach an agreement,” adding that both sides have relatively little experience because Samsung has historically lacked a strong union culture.

“The gap may seem large, but the issues are workable,” Kang said. “I believe the differences can be resolved without a strike.”

Taiwan-based market intelligence and research firm TrendForce pointed out:

Samsung’s strike is set to formally begin on May 21. Because the company’s semiconductor fabs are already highly automated, the impact on production is expected to be limited.

However, there will likely be noticeable disruptions to packaging and logistics, R&D and design, and customer relations. In terms of unionization, about half of all employees across the Samsung Group are union members, most of whom work in the semiconductor division. Internally, management has already extended an olive branch to the DRAM division, but has not yet reached an agreement with union members in the Foundry and LSI divisions.

Samsung’s strike is set to formally begin on May 21. Because the company’s semiconductor fabs are already highly automated, the impact on production is expected to be limited. However, there will likely be noticeable disruptions to packaging and logistics, R&D and design, as well… https://t.co/l2ibgeXEIL

— TrendForce (@trendforce) May 15, 2026

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