Steve Eisman has spent most of the years since the financial crisis being asked, in his words, to predict the end of the world. In his latest weekly wrap – recorded Thursday night as the 10-year brushed 4.8%, he says he’s still not there on AI, but if he were – he lays out exactly how it would happen.

Eisman is not predicting that OpenAI fails – but it is the weak link in a chain that runs from two money-losing labs, through hyperscaler capex, to roughly half of projected US GDP growth – and arguing that it’s “not too early to think about” what happens if the link breaks.

“I predicted the end of the world once, and believe me, it was no fun. I am in no rush to predict the end of the world again, unless I am really convinced that it’s going to happen. But I’m not going to make such a prediction just because it will get a lot of press. There is no question in my mind that the entire US economy hinges on the success of AI. The amount being spent is just so large that were it to stop, the economy would go into a recession almost immediately.”

The chain: two companies, $700 billion of capex, half of GDP growth

Eisman waves off the two “bubble” arguments echoing through the halls – and that both hyperscalers’ vanished free cash flow, and Nvidia’s circular financing – are survivable if AI pays off. The real vulnerability, he argues, sits one layer down:

“So where is the Achilles heel? I think that it resides with Anthropic and OpenAI, because they are so central to the entire AI food chain. According to reports from various Wall Street firms, something like 70% of hyperscaler AI revenue comes from Anthropic and OpenAI… I can’t confirm those statistics, but they sound right given what we actually know about Oracle.”

From there it’s arithmetic:

“Hyperscalers are spending about $700 billion in capex this year, and even more next year, and that spend accounts for around half of the 2% GDP growth projected for 2026. So one must conclude that the health of the US economy is extremely dependent on hyperscaler capex, and hyperscaler capex is highly dependent on the health of Anthropic and OpenAI. That’s the chain.”

OpenAI is… the weakest link

Between the two labs, Eisman says, “OpenAI is the weaker entity” – pointing to a WSJ report on the 2nd quarter. 

“OpenAI’s June quarter revenue reached $6.7 billion, up only 18% versus the March quarter. Compare that to Anthropic’s revenue of $11 billion-plus in the June quarter, which was up over 100%… OpenAI’s costs reached $12.3 billion, up $3 billion versus the March quarter. So, in three months, revenue increased $1 billion, but costs surged $3 billion. Things are not moving in the right direction.”

(ZH Note; the $12.3 billion Eisman calls “costs” is OpenAI’s operating loss, including stock-based compensation, up from $9.3 billion in the first quarter, per WSJ. On $6.7 billion of revenue, that implies an expense line closer to $19 billion. Revenue rose $1 billion; the loss rose $3 billion.)

Then the departures. Chief revenue officer Denise Dresser left in August after roughly eight months, two days after Brad Lightcap ended an eight-year run. Eisman reads both through the lens of an IPO that keeps sliding:

“Supposedly, OpenAI is getting closer to an IPO. That’s the big payday for employees, because it means that eventually they can sell some of their shares. That two such senior employees would leave now is an important data point.”

Two fairness notes: Lightcap had already been moved out of the COO role in April, so his exit was telegraphed. And Eisman doesn’t mention Fidji Simo, who stepped down in July and was arguably the bigger loss.

The heart of the argument is what unprofitability does to a company’s relationship with its funders:

“When you lose billions upon billions, appearances matter a lot. OpenAI is completely dependent on the kindness of strangers funding its cash flow needs. When a company is growing and very profitable, appearances don’t matter nearly as much… But when a company is not profitable and has an insatiable need for capital, appearances matter more than anything, because if the narrative turns negative, raising capital becomes much more difficult.”

That’s why he flags last week’s “good news” – OpenAI’s ad business hitting a $1 billion annualized run rate – as bad news: earlier this year the company projected $2.4 billion of ad revenue for all of 2026, and $1 billion annualized in September doesn’t get there. 

pic.twitter.com/WGH5sNDwYz

— cocktail peanut (@cocktailpeanut) September 8, 2026

Oracle is the first domino – and the market has already run the drill once

“If OpenAI fails, Oracle is in immediate trouble because of the large increase in Oracle’s debt levels. Oracle’s debt rating is barely above junk. Oracle’s S&P credit rating is triple-B-minus, which is quite weak. Like I said before, it has a $600 billion backlog, and half of that backlog is from OpenAI.”

That isn’t Eisman’s inference; it’s S&P’s. When the agency cut Oracle to BBB- on July 9, it named OpenAI a “key credit risk,” put the lab at roughly half of a $638 billion RPO, and spelled out the failure path: if OpenAI can’t pay, Oracle is left holding data center leases it can’t exit or must re-lease on worse terms.

Eisman’s point is that investors have already seen the preview:

“Prior to the earnings report, the stock was $230 a share. In just a few days, it jumped to $330 a share. Then analysts started publishing reports pointing out that 50% of the RPO was from OpenAI, and the stock gave back all of its gains, plus, in a few months. Today the stock is around $145… From the peak, the stock is down over 50%. That decline is because the market perceives an over-reliance on OpenAI. Imagine what the market would do to Oracle stock if OpenAI fails.“

Why it doesn’t stop at tech – and what he’s doing about it

“The ramifications of an OpenAI failure extend far beyond just Oracle. Remember I said that AI capex accounts for 50% of US GDP growth. While the other hyperscalers are not quite as dependent on Anthropic and OpenAI as Oracle, they are dependent enough. If OpenAI failed, the hyperscalers, I am sure, would cut back on their capex. So I’m starting to think that the demise of OpenAI could push the US into an almost immediate recession.“

Affected sectors are all over the place… It isn’t just Amazon, Google, Microsoft, Oracle and Nvidia. It’s the investment banks, sitting at peak valuations on a financing cycle that AI is feeding. It’s GE Vernova and Quanta on power, Eaton and Rockwell on electrification and automation. The uncomfortable implication: a portfolio that “diversifies” across tech, financials and industrials may own three versions of the same trade.

His answer is reallocation, not stock-picking – healthcare, consumer staples, and within financials the property-and-casualty names – and he names three ETFs by ticker: LVHD, SPLV and KBWP. Then the caveat that should anchor this whole piece:

“It’s still early, and I want to emphasize that I am not making a major call. Not yet. I’m just preparing.”

That Said…

OpenAI has its own numbers. CFO Sarah Friar told employees that July’s annualized revenue already exceeded the entire second quarter, and the company says its run rate has topped $40 billion. Worth knowing: that is a latest-month annualization, while recognized Q2 revenue annualizes closer to $27 billion. Second, strangers have been extremely kind. A March round at a valuation above $852 billion reportedly raised more than $122 billion. Runway isn’t the near-term issue, it’s the next raise – which is Eisman’s point.

One more: Nvidia, where “both things can be true”

Eisman’s read of Nvidia’s $96.2 billion quarter – revenue up 106% year over year – is that the AI story “continues but is displaying potential weakness,” and that “both apparently contradictory ideas can be true.” His evidence for the weakness is Note 7 of the 10-Q: five direct customers at 22%, 14%, 13%, 11% and 10% of accounts receivable, which he sums to 70% and assumes “must be the hyperscalers.”

Careful there. That disclosure is receivables, not revenue, and Nvidia’s direct customers include distributors, ODMs and system integrators, not just clouds. The revenue disclosure in the same filing shows one direct customer at 16% of the quarter. The better version of Eisman’s point is one sentence lower in the 10-Q: Nvidia estimates that one “AI research and deployment company” – OpenAI’s own description of itself – contributed a meaningful amount of revenue by buying cloud services from Nvidia’s customers. Same dependency, no arithmetic error.

And the circularity he mentions in passing is in Nvidia’s own release: roughly $7.8 billion of gains on equity securities ran through other income this quarter, which is why GAAP net income ($59.7 billion) tops non-GAAP ($54.0 billion). Nvidia invests in the companies that buy its chips, then books the markups.

Eisman’s closing line on all of it:

“Once again, it looks like the entire AI ecosystem is dependent on the future health and success of two companies that currently lose billions. Again, if Anthropic or OpenAI ever get into trouble, the whole AI ecosystem will slow to a crawl.”

Watch the entire episode below: 

Via Middle East Eye

US officials have attacked the UK over its new trade sanctions on illegal Israeli settlements, amid speculation that Washington could publicly rebuke the British government.

On Tuesday morning, US Ambassador to Israel Mike Huckabee suggested the Trump administration could retaliate against Britain over its new trade sanctions on illegal Israeli settlements.

Meanwhile, Florida Republican Congressman Randy Fine warned that British companies could be stopped from doing business in Florida, accusing the UK of a “vanity project in support of Muslim terror”.

Huckabee told the BBC that the UK’s planned ban on Israeli settlement goods would be a “discrimination against the Jewish people”. He suggested US states, specifically Florida, could take trade action against Britain.

Over the weekend the ambassador had accused the British government of “Jew hate” in response to criticisms of Israel’s actions in Gaza by British Foreign Secretary Ed Miliband, who is himself Jewish. 

Congressman Randy Fine warned on Monday night: “As the British government considers forcing British companies to boycott portions of Israel, it should be aware that a Florida law that I passed as a member of the Legislature would ban any British company forced to comply from doing business with any state or local government in Florida.”  

Fine added: “It would also end any British business participating in that boycott from doing any business in Florida if it needed any official interaction with state or local government to operate” (permits, tax collection). 

“Florida is one of Britain’s largest trading partners. They should understand that their vanity project in support of Muslim terror could cost them billions of dollars.” 

Fine further said: “Any company – or nation – that boycotts Israel is boycotted by Florida.”

Foreign Secretary Ed Miliband is expected to outline a raft of new measures on Israel in parliament in the early afternoon. 

The United States privately urged the British government not to go ahead with the ban on Israeli settlement goods, MEE understands.

Same day:

• Israeli defense minister calls total ethnic cleansing of Gaza
• He doesn’t rule out using force against UK for it sanctions
• 2 Palestinian boys killed in West Bank after settler attack
• A Palestinian village razed to the ground in WB pic.twitter.com/ONfaQb7I92

— Ragıp Soylu (@ragipsoylu) September 2, 2026

UK Prime Minister Andy Burnham reportedly briefed US President Donald Trump on his plans to introduce sanctions on Israel on Monday afternoon. 

On Monday night, Israeli ministers Itamar Ben Gvir and Bezalel Smotrich called for Israel to sanction Britain and expel the UK ambassador over the issue of the Falkland Islands. Argentina and the UK both assert sovereignty over the South Atlantic archipelago, but the vast majority of the territory’s 3,600 residents back British rule.

Last week, Trump suggested he would not back the UK if Argentina invaded the territory. The US president has not yet commented publicly on the UK’s planned sanctions.

Authored by Rachel Roberts via The Epoch Times,

Iceland summoned the U.S. ambassador on Monday after U.S. President Donald Trump posted an image on Truth Social showing the north Atlantic island and other countries covered by the American flag, according to local media RUV.

Trump’s Labor Day post depicted the United States, Canada, Greenland, Iceland, Mexico, the whole of Central America and the Caribbean covered by the stars and stripes banner, with the entire landmass labeled “United States of America.” The image was shared without comment by the president.

Iceland is a founding member of NATO but has no army of its own and has had an agreement with the United States for its defense since 1951.

Icelandic Foreign Minister Thorgerdur Gunnarsdottir called in Billy Long, the U.S. ambassador to Iceland, who is new to the role, having formally taken up the post in August, according to RUV.

“The position was clearly expressed that the post was completely inappropriate,” the foreign ministry told RUV.

‘The 52nd State’

Former Missouri Congressman Long joked in January that Iceland would become the 52nd U.S. state and that he might be appointed governor.

During his Senate confirmation hearing for the ambassadorial post in February, Long acknowledged this was a mistake, but said he was not being serious.

“It was like a three-way [conversation]. Somebody said something, somebody else said something, and yes, I did add the part about the 52nd state, which was totally inappropriate. But it was not something that I said as a pronouncement that was serious,” he said.

“I just hope that the people in Iceland will give me a second chance to make a first impression,” he said. “I have a lot of respect for them. They have a beautiful country – 700,000 Americans go there every year. I hope I can get that up to a million by the time my term’s up.”

Tensions Over Greenland

Trump’s repeated assertions that the United States must acquire or control Greenland, a semi-autonomous Danish territory, led to tensions between Washington and Copenhagen.

Denmark has reiterated that the mineral-rich Arctic island is “not for sale,” and that the future of Greenland is for the island’s people to determine, together with Copenhagen.

The situation sparked a broader diplomatic crisis within Europe and NATO, with both the United States and Denmark founding members of the defense alliance.

Iceland last month narrowly voted in a referendum against reopening EU membership talks, with Trump’s ambitions for Greenland featuring in the debate around whether or not the economically prosperous North Atlantic island would benefit from joining the 27-nation bloc.

Supporters of restarting EU accession talks pointed to the changing international security environment, including uncertainty surrounding Iceland’s long-standing defense relationship with the United States.

Trump made his post just hours after the EU announced a 200 million euro ($232.5 million) investment package in Greenland during a visit by European Commission President Ursula von der Leyen.

Danish Prime Minister Mette Frederiksen told Danish news agency Ritzau in Nuuk that the Greenlandic government and the Greenlandic people “have said again and again that they do not want to be American.”

“I hope no one is in any doubt about that, either in the United States or the rest of the world,” she said, while on a visit to Greenland alongside von der Leyen and the Arctic island’s prime minister, Jens-Frederik Nielsen.

Trump’s ‘Verbal Stumble’ at Davos

In January, addressing the World Economic Forum in Davos, Switzerland, Trump appeared to mix up Greenland with Iceland several times, saying that Iceland had cost the United States a lot of money due to a drop in the stock market.

Secretary of State Marco Rubio later said that Trump had misspoken and said Iceland when he meant Greenland, saying, “I think we’re all familiar with presidents that have verbal stumbles. We’ve had presidents like that before. Some made a lot more than this one.”

In 2016, an addendum was made to the Iceland-U.S. defense agreement which was neither publicly discussed nor published in Iceland when it was signed, according to RUV, which reported on it last year.

The addendum gives the U.S. military and its contractors unrestricted access to Iceland’s defense areas for the purposes of defending the island, which is sparsely populated with about 393,000 people.

The U.S. State Department did not immediately respond to a request for comment.

Greater China accounts for about 13% of Nike’s revenue and 15% of Adidas’, making the world’s second-largest economy a major competitive battleground for both clothing brands. 

A new UBS note highlights a widening divergence, with Adidas gaining market share as Nike’s turnaround struggles to gain solid traction.

UBS retail analyst Jay Sole wrote Monday that Adidas continues to outperform Nike in China, citing an industry expert who highlighted Adidas’s stronger locally tailored products and marketing. Nike, meanwhile, faces weaker product momentum woes, inventory challenges and disruption from changes to its distribution strategy. 

Sole’s conversation with the industry expert and other findings raise further questions about Nike management’s execution and its ability to refocus the business on product innovation and consumer demand after years of prioritizing woke cultural wars that only ended up with S&P Dow Jones Indices booting the company out of the S&P100 later this month. 

Here’s more color on Sole’s conversation: 

China athletic wear industry market conditions are have softened: 

We hosted a call on September 4th with an industry expert to provide insight around how athletic wear sales are trending in China. The expert believes overall industry conditions have become more challenging over the last several months, with demand slowing versus earlier in the year. While consumer interest in athletic wear remains healthy, shoppers are becoming increasingly value conscious amid broader macroeconomic pressures. Inventory levels across the industry remain manageable, though conditions vary significantly by brand. adidas continues to outperform and gain market share, while Nike remains under pressure due to ongoing channel restructuring, inventory challenges, and weaker product momentum. Domestic brands and emerging running brands are also gaining traction.

Consumers remain engaged but are becoming more value-focused: 

The expert believes Chinese consumers remain interested in sportswear, fitness, and active lifestyles. However, macroeconomic uncertainty continues to influence purchasing behavior. Rather than exiting the category, consumers are becoming more selective and increasingly focused on affordability and value. Many shoppers are trading down to lower-priced products or gravitating toward brands that offer stronger perceived value. This environment appears to favor brands with compelling pricing, strong local relevance, and differentiated product offerings.

Nike: Challenges persist and a full recovery likely takes more time: 

The expert noted Nike and Jordan have been the weakest-performing major global sportswear brands in China recently. The expert believes sales trends deteriorated through the summer, with declines remaining in the -DD% range and further decelerating into September MTD. According to the expert, Nike’s challenges are largely idiosyncratic. Nike has less new product innovation in the performance side of this business y/y. At the same time, the company has reduced distributor participation in ecommerce channels, scaled back promotional support, and focused on improving pricing integrity. While these actions may improve the long-term health of the business, they are adding to near-term sales pressure. Inventory levels remain somewhat elevated, though the expert noted conditions improved between July and August. Looking ahead, Nike’s recovery is expected to take time and will likely depend on improved product innovation, cleaner inventory levels, and successful execution of Nike’s revised distribution strategy, in the expert’s view.

Adidas: No signs of a slowdown, confidence in the 2027 outlook remains intact:

After beginning Q3 with high-single-digit growth, trading momentum strengthened considerably in August and September, with growth accelerating into the high teens. According to the expert, this performance has been driven by the success of the company’s local-for-local product strategy, supported by effective and locally relevant marketing initiatives. While inventory levels remain somewhat higher, they are viewed as manageable, with no signs of increased discounting or promotional activity. Looking ahead, experts expect demand trends to remain healthy through the end of the year, with no indications of a slowdown. Early indications for 2027 are also constructive, with order books pointing to high-single-digit growth

Looking ahead: Industry growth likely remains modest while share shifts expected to continue:

The outlook for China’s athletic wear market remains constructive but increasingly competitive. The expert expects industry growth to remain modest and roughly in line with broader economic growth. Market performance has become more polarized, with stronger brands continuing to gain share while weaker brands face mounting pressure. adidas appears positioned to continue gaining market share, supported by healthy inventories, strong product acceptance, and positive distributor sentiment. Nike is expected to remain under pressure as channel restructuring efforts continue and distributors work through elevated inventory levels. Beyond the major global brands, the expert highlighted continued strength from domestic players such as Anta, as well as international running-focused brands including On, ASICS, and Salomon. Overall, success in the market is increasingly tied to localization, product relevance, and the ability to deliver compelling value to consumers.

Nike shares have plunged nearly 40% this year through Monday’s close, leaving the stock deep in a bear market.

Adidas has fallen roughly 12%, outperforming its US peer so far this year. 

As part of the latest in the Trump-Bessent “asphyxiation of this regime” approach to Iran after six months of military action failed to accomplish most White House aims, the Trump administration on Tuesday announced it is sanctioning all Iranian airlines in a massive aviation crackdown.

The Treasury statement listed 27 Iranian air carriers and nine entities as part of an effort to deny the Iranian government the ability to move “weapons, personnel, and illicit cargo”.

“Let this be a warning to anyone doing business with Iran’s remaining airlines, all of which we sanctioned today: You are at risk of being cut off from the global financial system,” Bessent said.

On the list is Ava Airlines, Fly Persia, and Mehr Airways – and others, after the US first sanctioned Mahan Air in 2011, which was the first such instance of Washington sanctioning an Iranian commercial airline.

Related secondary sanctions were implemented on top of the direct airline measures.

“The Treasury Department also sanctioned Turkey-based firms that have coordinated shipments, including drone components and industrial equipment destined for Iran, on behalf of Mahan Air, and it sanctioned a Turkey-based entity that has served as a general sales agent for Mahan Air and coordinated shipments on behalf of the blacklisted airline,” The Hill details.

“Other sanctioned entities with ties to Mahan are based in Malaysia and Kazakhstan,” the report further indicates.

Iranian Foreign Minister Abbas Araghchi mocked the ‘Economic D-Day’ and ‘Operation Epic Outcast’ sanctions, saying that the fallout of the war “has been disastrous for America, including its standing worldwide.”

“After failing to achieve its aims through sanctions or war, Washington’s ‘novel’ solution is…more sanctions. Seriously?” Araghchi wrote Tuesday afternoon.

The Wall Street Journal has meanwhile noted that Mahan and others continue defying sanctions and the US pressure campaign, while still clearly struggling:

Out-of-date aircraft: Mahan’s three dozen planes tend to be aging, secondhand Boeing and Airbus aircraft, some in service for as long as 35 years. Passengers who post about their trips on social media say there is no onboard entertainment or alcohol, and tickets have to be purchased in cash instead of international credit or debit cards.

New horizons: Despite the lack of amenities, and the sanctions scrutiny, Mahan has been adding new destinations for passenger and cargo services during the war between the U.S. and Iran.

In this new @ForeignAffairs essay, I argue that US officials are being too triumphant about Iran’s economic downturn.

Iran’s leaders are using inflation to engage in financial repression. Counterintuitively, reduced economic activity is helping the state stave off a deeper… pic.twitter.com/jRtAZYEnHG

— Esfandyar Batmanghelidj (@yarbatman) September 8, 2026

In recent years the Islamic Republic has suffered some significant aerial disasters, which included the May 19, 2024 death of President Ebrahim Raisi. His military helicopter went down in a rugged, mountainous area of northwestern Iran. Some speculate that lack of airline parts and aging aircraft, due to the long-standing US targeting of the industry, has increased the chances of aviation disasters.

Authored by Simon White, Bloomberg macro strategist,

TIPS continue to mean revert and risk overshooting to the downside, leading to a continuation in rising real yields.

Real yields in the US have had a remarkably good run, with 10-year reals bottoming at about 1.72% at the end of March and rising to near 20-year highs at 2.43% currently. That’s even more remarkable when you consider that oil has on net risen almost 70% over the same period.

TIPS were overbought coming into the Iran war, but are now back to their mean. As the chart below shows, TIPS’ annual return is a mean-reverting series, with a decaying mean. Like a pendulum, when the series gets back to its mean it typically overshoots.

If that was to recur, then we should expect real yields to keep rising.

That is consistent with the message from my leading indicator for real yields. Its inputs include G10 excess liquidity and the Federal Reserve’s policy rate, and it anticipates the 10-year real yield rising more over the next three months or so.

Short positioning in TIPS looks elevated, based on the short interest of the iShares TIP ETF. We’re not likely to see significant short covering while momentum is in the bears’ favour.

In shares terms, the short interest is not as high as it was during the inflation flare of 2021/22 and subsequent rapid Fed tightening, but the short interest ratio, ie normalised by the shares outstanding, is at a similar level to what it was back then.

There are different drivers this time. Fed pricing is not as big a part of it, with only two and a bit rate hikes expected over the next year. Instead it’s a combination of rising real growth expectations and greater competition for capital, driven by the seemingly insatiable demand for investment in AI infrastructure.

A good slug of the rise in real yields this year, however, also comes from increasing risk premium for TIPS. No wonder short positioning is high.

King Charles delivered a humiliating public slapdown to Prince Harry and Meghan Markle yesterday after the couple’s surprise return to Britain, making it crystal clear they remain firmly out of the Royal Family.

Buckingham Palace issued a stinging letter on Monday spelling out that the Duke and Duchess of Sussex have no official role, no working duties and no hope of a half-in, half-out arrangement.

“It is well known that in January 2020 the Duke and Duchess stepped down from undertaking representative duties on behalf of The Sovereign, and are no longer working Members of The Royal Family,” read the letter sent by the Lord Chamberlain, the royal household’s top official. “This position, distinct from the State and Royal duties undertaken by the working Royal Family, and with the personal latitude it brings the couple in respect of financial independence and protection of their privacy as they would wish, will continue to be fully respected.”

Buckingham Palace stressed that simply pitching up on British soil does not restore their royal standing.

“It follows that there is no change to the current status of the Duke and Duchess of Sussex,” the letter added. “Their styles as His and Her Royal Highness remain in abeyance and are not used. The charitable work of the Duke and Duchess is a personal matter for them both and undertaken in their private capacity. In short, their position is akin to private citizens with commercial and charitable interests.”

A spokesman for Harry and Meghan responded to the letter with a terse statement, claiming that the pair had been blindsided.

“We were a little surprised not to have been told about this in advance. The publication of the letter had caught the couple off guard,” their statement reads.

However, Palace officials only told them of the King’s position an hour before the letter was published, according to GB News.

Meanwhile, some royal watchers said that no one should be remotely shocked by the king’s actions.

While Harry and Meghan are returning, they are not regaining official royal roles,” British royals expert Hilary Fordwich told Fox News. “Nor was there any agreement to a ‘half-in, half-out’ construct. They have been thwarted by trying to do what they agreed to with Queen Elizabeth II.”

Brent crude futures topped $100 a barrel for the first time since July as US strikes on Iranian oil tankers and renewed attacks on Saudi energy infrastructure and a US base in Jordan suggested to UBS energy specialist Dominic Ellis that a “US-Iran off-ramp remains elusive.”

Ellis adds more color on the overnight Gulf developments and response in the crude oil market:

Brent topped $100/bbl as the US and Iran continue to trade strikes around the Strait of Hormuz. 

The US says it has destroyed multiple Iranian vessels (including 5 on Sept. 8) in response to Iranian attacks, and says it will respond to each subsequent Iranian hit (actual or attempted) by destroying another Iranian tanker.

CENTCOM forces destroyed five Iranian crude oil carriers, Sept. 8, after the Islamic Revolutionary Guard Corps (IRGC) targeted a U.S. Navy warship with ballistic missiles twice over the past two days. The U.S. warship successfully evaded the attempted Iranian attacks and… pic.twitter.com/Gi8a2tloN1

— U.S. Central Command (@CENTCOM) September 8, 2026

Iran hit a US base in Jordan, and has stepped up attacks on the US’ regional allies, with Saudi Arabia’s energy infrastructure under particular pressure. 

Some investors have shown signs of wanting to fade the rally in oil and related equities, but the change in tone from all concerned makes it seem less likely (if not impossible) that we will see a return to the de-escalation narrative that has historically triggered a drop in oil and profit-taking in equities. 

With the tailwind into Q3 numbers for the integrated energy sector, I think most will be inclined to leave long positions open until there is evidence of real progress back toward a diplomatic off ramp.

Iran has reportedly rejected the latest US offer of talks, and the conflict seems likely to support oil at current levels and potentially push prices higher in the near term.

The global crude benchmark broke above $100 a barrel in European trading but initially failed to hold the level. Just over an hour later, at around 4:36 a.m. ET, Brent reclaimed triple digits and extended gains to $100.83 by around 6:00 a.m. ET.

Goldman’s head commodity strategist, Daan Struyven, wrote in a note on Monday that, given the renewed turmoil in the Gulf region, he raised his Brent/WTI price forecasts by $5 to $85/$80 for December 2026 and to $80/$75 for 2027, on the assumption that Mideast shipping disruptions continue into 2027.

Struyven outlined significant net upside price risks with two Gulf output and Brent scenarios:

• Price upside scenario: Brent might exceed $120/bbl if 2027 average Gulf output remains 4mb/d below pre-war levels, versus 0.5mb/d below in the base case. The bank views more intense shipping attacks in Hormuz and the Red Sea as the most likely driver of this lower-output, higher-price scenario.
• Price downside scenario: Brent might decline into the $60s in 2027 if 2027 average Gulf output rises 1mb/d above pre-war levels. Goldman still recommends hedging geopolitical risk through deferred Mar27-Dec27 European diesel timespreads, which would rise over 100% if persistent Russia or Mideast refinery outages keep the nearby 9-month spread near current levels.

Separately, Darrell Fletcher, managing director for commodities at Bannockburn Capital Markets, warned that the “path of least resistance is a strong and steady grind higher as the war enters seven months,” adding, “The fundamental picture for products remains bullish with global inventories and reserves deteriorating. In the typical pattern, the US and Iran continue their counterattacks and warnings.” 

Iran’s Islamic Revolutionary Guard Corps (IRGC) navy announced Tuesday it had captured an unmanned US submersible at the entrance of the Strait of Hormuz, a claim which corresponding photographs appear to back.

The US side has yet to confirm the capture of the advanced naval drone, but some reports suggest it was “lost” after failing to operate properly. The IRGC statement called it a “complex intelligence and operational action.”

Tasnim identified the captured system is a Dive-LD in a report, describing the autonomous unmanned underwater vehicle built by US defense firm Anduril Industries.

The Dive-LD is a very new, cutting edge weapon system, having only been delivered to the US military in 2025. It is able to operate up to ten days at a time without coming back to port or ship, and is reported to have a maximum operating depth of about 19,700 feet (6,000 meters).

Later on the same day, an unnamed US official issued the following (via Newsquawk wire):

US official says a US military underwater drone malfunctioned more than a day ago in the Middle East

The sea drone may have been operating as part of a US mission to de-mine the Strait of Hormuz. It is capable of mapping the ocean floor, as well as rapidly locating floating mines and other water hazards.

There have been recent widespread reports that elite Navy Seals have been engaged in a four-month mission to remove mines set in place by Iranian forces as part of its effort to close the Strait of Hormuz and hold global energy markets hostages to use as leverage against Washington.

This undoubtedly confirms that in recent weeks, the U.S. has attempted to conduct a covert operation to clear the Strait of Hormuz.

In fact, this naval drone is precisely a Dive LD, primarily used for mapping the seabed, inspecting underwater infrastructure, relaying and… https://t.co/z6zV7tmxDq pic.twitter.com/Cjb3egGW50

— MoloMonitor 🇮🇹 (@MoloWarMonitor) September 8, 2026

The above was not the only big Tuesday announcement by the Iranians:

Iran’s Islamic Revolutionary Guard Corps claims its air defenses have “intercepted and destroyed” an MQ-1 drone over the Strait of Hormuz, according to an IRGC statement carried by Iranian broadcaster IRIB.

The MQ-1 is a US-made remotely piloted drone often used for surveillance and reconnaissance.

The Pentagon has not yet definitively weigh in on this claim either. A huge number of advanced US drones have either crashed or been intercepted throughout the war, so this would hardly be the first such loss by American forces.

More images of sub capture: The submersible shown closely matches Anduril’s Dive-LD, an advanced large-displacement autonomous underwater vehicle deployed by the US Navy.

🇮🇷🇺🇸 IRGC captures advanced U.S.-made underwater drone in Strait of Hormuz

The IRGC Navy has released new footage and photographs of the autonomous underwater vehicle it says it captured while entering the Strait of Hormuz.

The vehicle shown closely matches Anduril’s Dive-LD,… pic.twitter.com/8t2QBtpmro

— DD Geopolitics (@DD_Geopolitics) September 8, 2026

Submitted by Thomas Kolbe

Was this the turning point of the summer, a kind of summer-sun Merz-turnaround?

Latest figures from the Federal Statistical Office show a significant jump in industrial orders in Germany: The order volume of companies across all sectors rose by 2.5 percent in July compared with the previous month – the third consecutive increase.

These are good numbers for the Chancellor, who is desperately looking for supporting arguments for his political course ahead of the state elections in eastern Germany. The economic reporting of the past week was striking: Economic institutes are revising their growth forecasts for the current year upward. LBBW, for example, now expects growth of 0.7 percent for the current year, up from 0.5% previously.

Growth of 0.7% – given an officially reported government spending ratio of 52.5% and new borrowing of around 4% this year, this is a pitiful figure. It marks no turning point. The figure merely shows that the private sector remains on a path of contraction and will lose at least two to three percent in substance.

We are witnessing a statistical effect. Merz is inflating a debt-financed economic phantom, raising the question: How can real economic prosperity grow out of artificially created credit? If the world were really that simple, all of humanity could catapult itself into the economic stratosphere from one day to the next with a debt-financed Keynesian demand program.

But reality, unfortunately, does not correspond to the voodoo economics of long-faded theories.

Let us therefore return from the Keynesian dream world to the world of true economics.

Comparing incoming orders with the situation a year ago could give the impression that we have reached the peak of an economic boom: In July, incoming orders were 13 percent above the previous year’s level – a fabulous figure, one the German economy may have last seen during the years of the post-war economic miracle. The July figure stands out so markedly that investment demand is pushing up the entire gross domestic product and more than compensating for the dramatically poor figures in the other sectors of the economy.

A brief classification: Retail sales were down 2.5% in real terms in July compared with the previous year. Hospitality revenue fell by more than 5% in real terms year-on-year. All in all, consumption stagnated in the first half of the year; only credit-financed government demand prevented a dramatically negative figure. On top of this, inflation, now at three percent, is slowly but surely eating holes into the purchasing power of private households.

But the beautiful appearance of the numbers is deceptive. Everything stands and falls with the large orders recorded statistically. Looking into the mechanics of the statisticians, one sector in particular catches the eye: other transport equipment. It contains, above all, orders for military goods. The statistics currently reflect the development of the military sector almost exclusively, because the private sector is not investing in major projects.

If this sector, which had exploded by a staggering 126.4% compared with the previous month, is excluded, industrial orders as a whole actually fell by 1.4% in July. That would hardly be a reason for celebration, including for the Chancellor, who seems to have gotten lost somewhere in the east on his campaign tour while searching for media-friendly crumbs.

Looking at individual items, the situation in German industry remains dramatic. In the automotive industry, it looks downright apocalyptic. German automakers had to absorb a 12.5% decline in orders compared with the previous month.

Free fall in Germany, the land of the automobile.

Foreign orders overall fell by 2.1% – customers outside the eurozone ordered even 10.1% fewer industrial goods. Domestic orders, by contrast, rose by 9.1% compared with June – another indication supporting the thesis that these may be the first larger waves generated by the German government’s debt-financed special fund.

Friedrich Merz and his debt minister Lars Klingbeil are presenting us with an economic experiment that has been performed many times in the past and has always failed.

Once caught in the ideological degrowth trap, the pressure to act in the political boiler continues to rise. As a result of climate policy, dark clouds are gathering over the economic horizon, and political rescue efforts begin reflexively. Friedrich Merz is prescribing the debt-financed military Keynesianism described above as the extinguishing agent for the economic wildfire. Tanks, drones and howitzers are supposed, if the Chancellor has his way, to replace specialized machinery, motor vehicles, machine tools and industrial plants.

Welcome to the economic military yoke of the statist Merz.

But, like every form of interventionism, this policy will leave nothing behind but new mountains of debt, if not an entire Himalayas of debt.

And, as if to confirm this, statisticians reported at the beginning of the week that Germany’s new borrowing had risen from €35 billion to €71 billion in the first half of the year.

Correctly calculated and expanded to include municipal debt as well as the special fund that will only become effective in terms of payments in the second half of the year, Germany’s debt will increase by at least €180 billion this year. That corresponds to new borrowing of more than 4 percent of GDP. We are facing the disastrous legacy of the debt king Merz, who has sacrificed his country’s creditworthiness in pursuit of his personal political goals.

Only economic illiterates regard debt-financed government consumption as economic prosperity.

The construction of the state economy has consequences.

Germany has been seized by a process of economic erosion. Total industrial production in Germany has lost around 15 percent of its volume since the best year, 2018 – a political scandal that to this day is successfully ignored by the relevant circles in the specialist press, the daily media and politics alike, if it is not simply dismissed as a figment of the imagination of malicious opponents.

The booming arms manufacturers, too, should not celebrate too early. The path of the booming sector is predetermined, and it points toward the same abysses toward which civilian industry is heading. The fog will lift the moment the flow of subsidies dries up as a result of the economic crisis in the country.

Then the abyss will become visible. Because at the toxic German location, with its high energy costs, excessive regulation and unfavorable political climate, industrial investment simply no longer pays off.

The flash in the pan of Merz-style military Keynesianism will not change this finding either.

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About the author:  Thomas Kolbe, a German graduate economist, has worked for over 25 years, he has worked as a journalist and media producer for clients from various industries and business associations. As a publicist, he focuses on economic processes and observes geopolitical events from the perspective of the capital markets. His publications follow a philosophy that focuses on the individual and their right to self-determination.