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Trump ‘Favors’ Attacking Iran, Vance Pushing Back, As President Pezeshkian In Streets For Large Counter-Protests

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Trump ‘Favors’ Attacking Iran, Vance Pushing Back, As President Pezeshkian In Streets For Large Counter-Protests

Update(1820ET): There are reports of a significant internal Trump administration divide over Iran policy, with Vice President Vance said to be leading the charge for the non-interventionist camp, which much of MAGA might welcome while seeing in Vance the top contender for 2028:

President Trump currently leans toward authorizing fresh military strikes on Iran, U.S. officials say, as the White House is weighing a last-ditch Iranian offer to engage in diplomacy over curbing its nuclear program.

Some senior administration aides, led by Vice President JD Vance, are urging Trump to try diplomacy before retaliating against Iran for killing protesters. Trump hasn’t made a final decision on what he will do and will meet with senior aides Tuesday to determine his approach.

Some in the U.S. doubt that Iran is genuine about ending its nuclear program, telling Trump that Tehran may be finding a way to buy time and avoid American airstrikes. Aides have briefed Trump on the benefits and pitfalls of renewed nuclear negotiations with Iran.

Trump currently favors attacking Iran, but could change his mind depending on unfolding developments. Some officials said Trump may strike first and then seek serious talks with Tehran. “We may have to act because of what is happening before the meeting,” he said Sunday.

But all of this might become moot, or else it could be said Trump will have an easy ‘out’ or offramp and not attack Iran, given the latest reports from inside the country show waning anti-govt protests. Instead, they’ve been supplanted by huge pro-government counter-demonstrations. “Millions” or at least hundreds of thousands have come out for these ‘loyalist’ demonstrations. And even the country’s President Masoud Pezeshkian was out confidently and defiantly strolling the streets Monday…

One regional analyst and observer reacts to Monday’s developments, after a weekend security crackdown unleashed at least scores of casualties:

The Islamic Republic is sending two important signals here:

1. It retains control in large cities (or at least the ones/areas we’re getting footage from)

2. It can still countermobilize its base of support (and others forced to turn out) in large numbers. 

He concludes, “If this is it, these anti-regime protests may well fizzle out before long, although I’ve noted major ‘landmines’ ahead for the Islamic Republic in 2026.”

Another hugely important development Monday, ultimately aimed at China…

And still “on the table”…

* * *

Update(10:15ET): Iran’s Supreme Leader is really playing with fire here in posting the below image on X. While the message didn’t appear on his English language account, it is on his Persian account, and thus mainly directed at the Ayatollah’s own domestic population.

According to a machine translation, the message says: “That father figure who sits there with arrogance and pride, passing judgment on the entire world, he too should know that usually the tyrants and oppressors of the world, such as Pharaoh and Nimrod and Reza Khan and Mohammad Reza and the likes of them, when they were at the peak of their pride, were overthrown, This one too will be overthrown.”

Khamenei perhaps suddenly feels more embolden to poke and mock Trump like this perhaps given the emerging widespread reports that the protests are losing steam, after weekend clashes with policy reportedly resulted in many deaths. There was definitely a major and deadly security crackdown, but this also as the government asserts that dozens of police and military have been attacked and killed, and buildings set on fire by ‘rioters’ and ‘saboteurs’.

There are also very large pro-government ‘counter protests’ taking over whole areas of cities Monday, including in the capital:

The Trump administration was quite out front with saying it would “stand” with the Iranian people, and even protect them if they come under assault from government forces. This allowed Iranian leadership to tell people in the streets that they are doing the bidding of foreign powers like the US and Israel.

This also amid more tough talk from Iran’s parliament on Monday:

Iran’s parliament speaker has described the response to the protests as a fight with “terrorists” while addressing a large rally in the capital.

Iran is fighting a “four-front war”, Mohammad Bagher Ghalibaf said, listing economic, psychological and military engagement with the United States and Israel, and “today [is] a war against terrorists”.

“The great Iranian nation has never allowed the enemy to achieve its goals,” Ghalibaf said as supporters chanted, “Death to Israel, death to America.”

He pledged Iran’s military would teach Trump “an unforgettable lesson” in case of a new US attack, adding: “Come and see all your facilities in the region destroyed.”

Trump on Sunday did raise the question of direct help to the protesters (who may not actually be interested in Washington’s help). Trump said he will speak to Elon Musk about sending Starlink to protesters in Iran, following the government-imposed outage which has remained in place since Thursday.

“We may get the internet going if that’s possible,” the president told reporters. Elon “is very good at that kind of thing. I’m going to call him as soon as I’m finished with you.”

Is the rhetoric between Washington in Tehran softening as it becomes clear the regime is not under threat by the protests?

Iran says it is “prepared for war” but ready to negotiate with the US based on “mutual respect and interests,” after US President Donald Trump said Tehran called to negotiate as his administration weighs possible military intervention during widespread anti-government protests.

* * *

The NY Times and others are confirming that President Trump has recently been briefed on a series of new military strike options targeting Iran as he weighs whether to act on his threat to attack the country over its crackdown on protesters, which have also clearly themselves engaged in violent acts in some locales at times.

In some of among the well over 100 cities or towns where protests have raged since the end of December, buildings and even mosques have been burned, cars torched, and police officials reportedly shot and stabbed. Amid an internet blackout across the country, which has made accurate information hard to come by and/or verirfy, there is a battle of narratives and ‘infowar’ happening. 

AFP/Getty Images

Starlink terminals were said to be smuggled into the country during the 2022 wave of protests, and so there has been some limited information and videos emerging even amid the several consecutive days of internet shutdown by the government.

President Trump during Friday’s meeting of oil executives again warned Iranian leadership not to kill protesters: “I’ve made the statement very strongly that if they start killing people like they have in the past, we will get involved,” he said. “We’ll be hitting them very hard where it hurts. And that doesn’t mean boots on the ground, but it means hitting them very, very hard where it hurts.”

Trump later narrowed the warning, “I tell the Iranian leaders: You better not start shooting, because we’ll start shooting, too.”

Secretary of State Marco Rubio on top of that issued on X that “The United States supports the brave people of Iran” – something much vaguer and coupled with no specific threat.

From there, unverified reports throughout the weekend said that body bags from protest deaths were piling up. By last week, around 30 people were reported killed, including several or more among police and security officials. But by Sunday into Monday that figure ballooned.

Reuters and CNN have relied on a US-based group to claim, “More than 544 people have been killed over the past 15 days during anti-government demonstrations, including eight children, according to the Human Rights Activist New Agency (HRANA).”

This new, high death count, is unverifiable but is still being widely circulated on Monday. It has been issued at a very sensitive and dangerous moment that the anti-Ayatollah opposition which largely lives in Europe and the United States is lobbying hard to get Trump’s ear and attention.

All the usual other enemies of Tehran are being very active in this regard too, such as the powerful Israel lobby in the United States.

On the ‘options’ briefings, the NY Times has described that briefings President Trump has already received included a variety of potential actions such as strikes against nonmilitary locations in Tehran.

When reporters asked about preparations for possible military action, the White House pointed instead to the president’s recent public statements and posts on social media. “Iran is looking at FREEDOM, perhaps like never before,” Trump had additionally stated on Truth Social on Saturday. “The USA stands ready to help!!!”

If Trump were to actually kick off yet more US military action in the Middle East, this time against a large nation like Iran which would hold the serious potential for escalating into a full-blown conflict, it would likely prove deeply unpopular among his base. Broadly, the American public would likely not be on board.

A Goldman Sachs note highlights that the build-up rhetoric threatening US intervention in and of itself will have an impact on oil, gold, and across markets:

Attention shifts to Iran as we speak. Unlike the 2022 protests centered around social liberties, this episode looks to be triggered by economic paralysis with inflation spiking and the sudden collapse of the Iranian rial in late Dec. The protests have now turned violent with death toll rising to the hundreds. What can potentially add oil to fire is if foreign interference continues to get talked up with the US signaling the threat of a potential intervention. Oil and Gold creeping up as the Iranian unrests unfold. This illustrates our view of the insurance value of commodities. We see a strong role for broader commodity length in strategic portfolio allocations with increasing geopolitical, trade and AI competition has led to more frequent use of commodity dominance as leverage.

Iranian businesses have in many cased been forced to suspend all activity because of Iran’s internet shutdown, especially those companies which are dealings or staff based abroad. The shutdown is said to be so severe that even the banking system isn’t operating, and something as simple as removing money from an ATM can’t be done.

Leadership in Tehran might have made things much worse for itself with the decision to block internet access, given the protesting and rioting crowds hadn’t dispersed, but instead clashes with police may have grown more intense and violent. Iran’s foreign ministry has been cited in Bloomberg Monday as follows:

Iranian Foreign Minister Abbas Araghchi says police and security forces brought protests “under control” from Saturday, according to statement to state TV. Araghchi: we have huge amount of evidence pointing direct Israeli and US interference in protests Says internet will be restored “soon after full control of security situation”

“Israel is directly responsible, and also Americans through their remarks by promoting violence,” Araghchi says.

As for what’s next, President Donald Trump will be briefed on Tuesday on “some kinetic and many non-kinetic” options in Iran, according to a couple of unnamed administration officials to Politico. But there have indeed been signs that the protests have begun to abate or in some places been halted completely.

Tyler Durden
Mon, 01/12/2026 – 18:20

The ICE Elephant: Why The Law Requires All The Facts

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The ICE Elephant: Why The Law Requires All The Facts

Authored by Jonathan Turley,

In a famous Indian parable, five blind men are brought to an elephant. Each feels a different part of the animal, and they come to radically different views of what an elephant is. It depended on which parts they touched, from tusk to tail.

The controversy over the shooting of Renee Nicole Good, 37, is a type of political elephant parable.

People focus on only certain parts of the story to support what they want the case to mean.

Critics and supporters of the responsible officer have slowed down videotapes that last, in critical part, for only a few seconds.

The only difference is that, in this modern parable, many are just willfully blind, choosing not to see beyond their own rage.

This week, Minneapolis Mayor Jacob Frey (D) became the personification of rage, spewing profanities about ICE while declaring, shortly after the shooting, that the ICE officer was a murderer.

After immediately declaring the officer’s guilt, Frey spent day two lambasting the federal government for rushing to conclusions and demanding that his people play a role in the investigation.

As for his unhinged, profane diatribe, Frey mocked critics if he “offended their Disney princess ears.”

Frey fulfilled the parable most clearly in his use of statistics. He declared that fifty percent of shootings in the city this year were committed by ICE. He then later admitted that, since it was only Jan. 9, there had been only two shootings. Indeed, he could have argued that ICE was responsible for 100 percent of the shootings in the city on Jan. 7.

Again, the trick is to examine the smallest part of the animal and extrapolate to draw sweeping conclusions.

The recently released videotape from the responsible officer also shows how people will focus on insular elements rather than the “totality of the circumstances,” the standard for such cases established by the Supreme Court.

For example, many supporters of the officer are citing the obstruction and taunting by Good and her wife, who were reportedly working with an anti-ICE group. At one point, Becca Good dares the officer to do something as they blocked the road, telling the officer “Do you want to come at us? I say go and get yourself some lunch, big boy.”

For critics, they have focused on Renee Good’s last words: “That’s fine dude, I’m not mad at you, I’m not mad at any of you.” Whether Good was being peaceful or passive-aggressive, others are clearly very, very mad. They are using her statement to push protesters to the brink of violence.

Democratic leaders declared ICE to be “terrorists” and called for mass protests in the very same city that burned in 2020 after the George Floyd riots. Right on cue, one Black Lives Matter leader suggested that the prosecution of officers in the George Floyd case only occurred because protesters burned down the city. She told protesters to ignore pleas not to do it again. “Let me tell you this. We need justice and we need it now.”

Protesters in other cities chanted “Kristi Noem will hang” and “Save a Life, Kill an ICE.”

In the same presser where he condemned federal officials for jumping to conclusions, Frey not only reaffirmed that Good had been murdered but added that the officer was not actually injured as claimed. “The ICE agent walked away with a hip injury that he might as well have gotten from closing a refrigerator door with his hips,” he said. “He was not injured. Give me a break. No, he was not ran over. He walked out of there with a hop in his step.”

Few of us have been in Frey’s kitchen, but the latest videotape seems to show something more intense than an encounter with his fridge. The video shows the agent being hit by the vehicle as Good ignores orders to get out of the car, as Becca Good is screaming, “drive, drive, drive.”

Reasonable people can disagree on whether the officer should have discharged his weapon. Flight alone is not grounds for the use of lethal force. However, Good’s actions could also be interpreted as an intentional endangerment of the officer.

At a minimum, it was clearly reckless, as another officer was trying to reach into the vehicle and Good refused to yield to the effort to place her into custody. The Goods forced the confrontation, and Renee Good then escalated the level of danger by speeding toward an officer.

This is why the legal standard requires you to take in the entire elephant, not just insular parts.

While there may still be countervailing facts emerging from the investigation, the governing legal standard clearly favors the officer. It is Good’s actions, not her motivations, that are critical to determining whether excessive force was used. The officer’s cellphone video shows he had a fraction of a second to decide and fired after being struck by the car. (The same officer had been seriously hurt previously after being dragged by a car.)

The Justice Department’s guidances incorporate the standards outlined in past Supreme Court decisions, such as Graham v. Connor (1989). Again, individual elements can be viewed in isolation as favoring or disfavoring the use of force, including the severity of the crime at issue (in this case likely a misdemeanor) and whether the suspect was “attempting to evade arrest by flight.” The guidelines stress that “[t]he ‘reasonableness’ of a particular use of force must be judged from the perspective of a reasonable officer on the scene, rather than with the 20/20 vision of hindsight.”

This tragedy shows that people watching the same videotapes can come to diametrically opposed conclusions. Take the speed of the vehicle. Some have noted that the car was traveling less than 10 miles per hour before it collided with another vehicle. However, the speed after the shooting of Good is immaterial. The relevant question is the distance and speed with reference to the officer. It was clearly speeding up and immediately struck the officer before Good was shot.

The same is true of those who note how the wheels appear to be turning toward or away from the officer. The fact is, Good struck the officer. That does not mean she intended to do so, but that does not matter. From the officer’s perspective, Good was ignoring orders while speeding toward him from just feet away.

There will likely be civil litigation. Democrats have also called for criminal charges. The arguments on both sides of this controversy show, at most, that the issue is debatable. The officer could be viewed as wrong and still be found to have acted within the scope of his discretion in responding to a threat. Any state effort to charge the officer will be removed to federal court, where he will likely have immunity based on this evidence.

The public would be wise to ignore conclusions reached blindly by either side. In an “Age of Rage,” we live in the land of the blind, where the one-eyed man is king. The public must remain clear-eyed and calm as the investigation proceeds in Minneapolis.

Jonathan Turley is a law professor and the author of the forthcoming “Rage and the Republic: The Unfinished Story of the American Revolution.”

Tyler Durden
Mon, 01/12/2026 – 18:05

Australia Joins The Rare Earth Reserve Rush

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Australia Joins The Rare Earth Reserve Rush

Australia will begin purchasing and storing key minerals for defense and high-tech industries from local miners as part of a A$1.2 billion ($802 million) national reserve aimed at strengthening global supply chains, according to a new report from Bloomberg.

Bloomberg reports that the initial stockpile will target rare earths, antimony and gallium, according to Treasurer Jim Chalmers, Resources Minister Madeleine King and Trade Minister Don Farrell. As one of the largest rare-earth producers outside China, Australia hopes the move will reduce Beijing’s leverage over critical resources.

Critical minerals have become a flashpoint in global trade disputes, particularly after China used its market dominance during trade tensions with the US. That has driven other nations to see local production and reserves as strategic priorities.

“Developing the Strategic Reserve is another important step in Australia leading on critical minerals globally,” Chalmers said. The stockpile will ensure “Australia is at the center of efforts to build stable and reliable supply chains for our international partners.”

Mining stocks rose on the news, with Lynas Rare Earths climbing up to 6.5% and Larvotto Resources jumping 8.8%. Larvotto, which is developing one of the world’s largest antimony projects, welcomed the move.

“The federal government is leading from the front on this, and we’re extremely happy antimony is one of the focuses,” said CEO Ron Meeks. “We will produce 7% of the world’s antimony, so we will be one of the largest suppliers. We’ll start production in August.”

The strategy follows China’s recent rare-earth export restrictions on Japan and builds on last year’s US-Australia agreement to expand American access to critical minerals, a deal covering roughly A$13 billion in projects. Officials also say the reserve could help stabilize prices and shield producers from future market downturns driven by cheap Chinese supply.

Rare earths are vital for permanent magnets used in defense and medical systems, while antimony supports electronics and flame retardants, and gallium is essential for advanced semiconductors in radar and communications.

Of course, we have been documenting the “rare earth revolution” since summer of last year, when we wrote that China’s export controls on key rare earth elements—especially the “heavy” ones used in high-performance permanent magnets—were creating shortages and price distortions outside China, exposing how dependent the world is on China for mined, refined, and magnet-ready material.

We noted that this mattered because rare earth magnets are foundational to today’s EVs, electronics, wind power, and defense systems, and they’re expected to be even more important for future robotics/humanoids.

With supply security viewed as a national-security issue, we correctly noted that governments and customers were prioritizing “ex-China” supply chains even if costs rise, and that shift is likely to support higher rare earth pricing and premium economics for the limited number of existing non-China players.

Tyler Durden
Mon, 01/12/2026 – 17:40

Trump May Freeze Exxon Out Of Venezuela After CEO Darren Woods Called It “Uninvestable”

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Trump May Freeze Exxon Out Of Venezuela After CEO Darren Woods Called It “Uninvestable”

Tensions flared between Exxon Mobil and the White House after CEO Darren Woods cast doubt on Venezuela’s appeal as an investment destination during a closed-door meeting with U.S. President Donald Trump and other oil executives last week, according to Reuters.

Woods argued that without sweeping legal and regulatory changes, the country could not support major foreign investment, describing its current system as “uninvestable.”

Trump had convened the meeting only days after U.S. forces removed Venezuelan President Nicolas Maduro in an overnight operation and urged the industry to commit as much as $100 billion to rebuilding Venezuela’s energy sector. Instead of gaining momentum, the talks were quickly overshadowed by Woods’ skepticism.

Reuters writes that Trump publicly voiced his frustration on Sunday while returning to Washington aboard Air Force One. “I didn’t like Exxon’s response,” he said. “I’ll probably be inclined to keep Exxon out. I didn’t like their response. They’re playing too cute.”

Exxon has long been entangled in Venezuela’s oil history. Along with ConocoPhillips and Chevron, it was once a leading foreign partner of the state firm PDVSA before nationalizations under Hugo Chavez forced Exxon and ConocoPhillips to exit the country and pursue arbitration. Court rulings later ordered Venezuela to pay more than $13 billion collectively to the two companies for seized assets.

Woods reminded Trump of that history, saying, “We’ve had our assets seized there twice, and so you can imagine to re-enter a third time would require some pretty significant changes from what we’ve historically seen here.” He also stressed that investment protections and reform of the hydrocarbons law were essential, adding, “If we look at the legal and commercial constructs and frameworks in place today in Venezuela today, it’s uninvestable.”

ConocoPhillips CEO Ryan Lance echoed the caution, telling Trump his company was the largest non-sovereign creditor in Venezuela and calling for a broad overhaul of the country’s energy system and debt structure. Trump replied that ConocoPhillips would recover much of what it was owed but insisted the future would begin anew. “We’re not going to look at what people lost in the past because that was their fault,” he said.

The president also made clear that Washington would control which companies are allowed to operate in Venezuela. “You’re dealing with us directly. You’re not dealing with Venezuela at all. We don’t want you to deal with Venezuela,” he said.

Recall, last week Trump met with leaders from Chevron, Exxon, ConocoPhillips, Continental, Halliburton, HKN, Valero, Marathon, Shell, Trafigura, Vitol Americas, Repsol, Eni, Aspect Holdings, Tallgrass, Raisa Energy and Hilcorp. 

Trump has argued that Venezuela’s vast oil reserves could help revive its economy while also benefiting U.S. consumers and energy companies. In a recent interview, he said he wants companies to commit at least $100 billion to “rebuild the whole oil infrastructure” in the country.

The administration has tightened pressure on Venezuela through a new oil “quarantine,” including the seizure of another tanker Friday, the fifth such action in recent weeks. Rubio said the strategy gives the U.S. “tremendous leverage” and that Washington plans to sell up to 50 million barrels of sanctioned crude on the open market, with the proceeds under U.S. control.

Tyler Durden
Mon, 01/12/2026 – 14:05

10Y Auction Stops Through In Solid Start For 2026 Treasury Sales

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10Y Auction Stops Through In Solid Start For 2026 Treasury Sales

Shortly after a solid 3Y auction, the first of the year, priced just through the WI by 0.1bps, moments ago we got the first sale of benchmark 10Y paper for 2026 in what was another solid auction.

Today’s sale of $39BN in 10Y paper priced at 4.173% just after 1pm ET. This was barely changed from the 4.175% in December in what appears to be duration paralysis. And with the When Issued trading at 4.180%, the auction stopped through the WI by 0.7bps, this was the strongest 10Y auction since September. 

More paralysis: the bid to cover was 2.554, virtually unchanged from last month’s 2.550, and just above the six-auction average of 2.51. As one can see in the chart below, we are now about a decade into the BtC being within 10-20bps of 2.50% in what may be the biggest autopilot trade in the US.

Turning to the internals, Indirects took down 69.7% of the auction, just a hair below last month’s 70.2% (and just above the 69.5% recent average). Directs took 24.5%, up from 21.0 in December and the highest since 2014. This left Dealers with just 5.8%, the second lowest on record with justs the 4.2% in Sept 25 lower.

Overall, this was a strong 10Y auction, and a solid start to the year for coupon issuance. 

Tyler Durden
Mon, 01/12/2026 – 13:37

Republicans Have Quickly Rallied Behind Trump On Venezuela

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Republicans Have Quickly Rallied Behind Trump On Venezuela
Republicans Have Quickly Rallied Behind Trump On Venezuela

A week after “Operation Absolute Resolve”, which saw the U.S. military attack targets in Venezuela to capture and extract President Nicolás Maduro, the international community is still grappling over the legality of the U.S. intervention.

While some experts are saying that the illegality of the U.S. attack is beyond doubt, U.S. allies are hesitant to openly denounce the U.S. actions.

The European Union, for example, issued a statement calling for calm and restraint by all parties involved. While acknowledging that Maduro lacked the legitimacy of a democratically elected president, the statement backed by 26 EU member states stressed that it was the right of the Venezuelan people to determine their own future. While calling for everyone, under all circumstances, to uphold the principles of international law and the UN Charter, the EU stops short of openly accusing the U.S. of violating these rules.

Meanwhile, as Statista’s Felix Richter reports, in the U.S., we saw a familiar story unfold, with a strong partisan divide opening up on a question that most Americans agreed on just a few months ago. “Would you support the U.S. using military force to invade Venezuela?”, YouGov asked in October 2025. Back then, just 15 percent of respondents – 7 percent of Democrats and 28 percent of Republicans – voiced their support. When YouGov posed the same question this week, i.e. after the raid that captured Maduro, replacing “would you” with “do you”, the picture looked entirely different: While support among Democrats was still very low at 13 percent, 74 percent of Republicans now said that they somehow or strongly supported the U.S. using military force in Venezuela.

Infographic: Republicans Have Quickly Rallied Behind Trump on Venezuela | Statista

You will find more infographics at Statista

These results highlight Trump’s still-intact ability to rally his supporters behind him by spinning the narrative in a way works in his favor.

Back in 2024, Trump ran on the promise to avoid getting dragged into wars overseas, much to the liking of his base.

A little more than a year later, the Trump administration appears to have abandoned this non-interventionist stance in favor of a new America-First foreign policy that stretches across the entire Americas, all the way from Greenland to Cape Horn.

Tyler Durden
Mon, 01/12/2026 – 13:25

Burning The Bridgeheads

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Burning The Bridgeheads

By Rabobank

2-year Treasury yields closed 4.4bps higher at 3.53% on Friday after December non-farm payrolls showed the unemployment rate falling to 4.4% and wage growth accelerating despite slower-than-expected hiring. Fed-dated OIS has seen a modest upward re-pricing in the market-implied path of the Fed Funds Rate, though two 25bp cuts by the end of the year remain in the curve with the first fully priced by June.

Breaking news that the Fed has just been issued subpoenas by the Department of Justice relating to statements made by Powell in testimony to Congress could see further recalibration in expectations of the future rate path. Powell has made a statement saying that concerns over his congressional testimony is simply a pretext and that “the threat of criminal charges is a consequence of the Fed setting rates based on our best assessment of what will serve the public, rather than following the preferences of the President.”

In essence, Powell is correct, the real target of the administration is central bank independence which renders the price of money immune to the democratic process and to coordination with other levers of national policy to achieve national policy goals. Independent central banking is a neoliberal shibboleth, but the neoliberal era is clearly over. For further evidence of that (as if it was necessary), look no further than the US’s recent moves towards capital controls and financial repression such as the ban on dividends and stock buybacks for weapons manufacturers, the banning of international wire transfers for welfare recipients, the proposed capping of credit card interest at 10% and the $200bn purchase of mortgage-backed securities designed to pressure lending rates lower. We’re sensing a pattern…

This week will bring the release of the December CPI report on Tuesday. That will give markets another chance to play the game of “up a little bit, down a little bit” even while the global economic and security architecture is being re-made around us in real time. Following comments from President Trump that the United States intends to acquire Greenland “the easy way” (i.e. by buying it) or “the hard way” (via military annexation), Danish PM Mette Frederikson said on Sunday that “we are ready to defend our values – wherever it is necessary – also in the Arctic. We believe in international law and in peoples’ rights to self-determination.”

Frederiksen’s comments recall Mark Twain’s observation that “it ain’t what you don’t know that gets you into trouble; it’s what you know for sure that just ain’t so.” In this case, some might argue that the international law that Denmark believes in is a polite fiction and that it has only been a thing in the past to the extent that it was enforced by the weight of US arms. Volodymyr Zelenskyy articulated as much at the United Nations last year when he said “…that’s the reality. Not international law, not cooperation – weapons decide who survives”. How can international law conceivably be enforced against US arms rather than by them? Who will do the enforcing?

So, while Frederiksen might say that Denmark is ready to defend its values, the reality is that it is not ready to defend Greenland. If the United States is truly determined to acquire the territory one way or another, it will ultimately prove successful. Frederiksen said last week that a US annexation of Greenland would spell the end of NATO, which is probably correct. This then becomes a problem for the entire European Union, who arguably need NATO much more than the Americans do. Are France and Germany happy to run that risk so that Denmark can keep Greenland?

Only a few short years ago the idea that the United States would be willing to risk what Zbigniew Brzezinski called its “democratic bridgehead” on the Eurasian continent by threatening the collapse of NATO seemed unthinkable. However, the critical tone taken towards Europe in the US’s new national security strategy and the ongoing evidence of appetite for rapprochement with Russia in an effort to isolate China calls those old assumptions into question.

So, is the US just playing Europe hot and cold or has something really changed? Europe’s lack of military and monetary sovereignty (see yesterday’s FT here) means that it cannot afford to gamble one way or the other, so the probability of capitulation to Trump over Greenland in a similar manner to how Europe capitulated over tariffs should not be dismissed. With EURUSD still trading above 1.16 at time of writing on a somewhat superficial rearmament narrative, it would seem to me that these risks are not in the price.

While the US plays hardball with Europe over the future of Greenland, the potential for a new democratic bridgehead on the Eurasian continent is appearing. Pro-democracy mass demonstrations in Iran are continuing despite reports that government crackdowns have resulted in the deaths of more than 500 protesters. President Trump has repeatedly warned the Iranian regime that the US may seek to intervene if protestors are harmed and the Wall Street Journal today reports that Trump will be briefed on Tuesday about possible US actions that could include distributing Starlink systems to counteract a shutdown of the internet, or even military intervention. Reza Pahlavi, the Iranian Crown Prince in exile, has called for protestors to continue to occupy public spaces and hinted at a return to the country. Did anybody have the restoration of the Shah on their 2026 bingo card?

The Iranian turmoil and developments in Yemen have contributed to a rise in oil prices in recent days that has more than wiped out the price falls that came in the aftermath of the US’s capture of Venezuela’s Nicolas Maduro. While this is mostly short-term market noise, the impact of US actions on supply chains is much more substantive.

Economics students are told that economics is the study of scarcity and taught to solve constrained optimization problems. However, these problems are generally academic abstractions, and by the time students finish their PhDs and head off to work for Treasury or a central bank they seemingly forget about real factor constraints and proceed to make simplifying assumptions that supply will be available when needed. In reality, the detail surrounding the availability (or otherwise) of physical stuff matters. Denmark will discover this if they care to test the theory that Greenland can be defended without the presence of physical military materiel.

Craig Tindale excellently describes this dawning realization for Western policymakers as ‘the return of matter’. Our own Michael Every has articulated the idea as “what is GDP *for*”. In a nutshell, what is being described is supply chain sovereignty and this will continue to be the conversation going forward as Western powers pivot away from financialization and back toward industrialisation. Once more for the people in the back: *the neoliberal period is over*.

In the case of Venezuela, we find expression of this idea in the fact that it isn’t the size of the country’s oil reserves that is most critical, but the fact that those reserves are of a heavy grade suited to US gulf refineries and now prevented from flowing to Chinese refineries that were established on the assumption that supply would be forthcoming. This raises the prospect of Chinese refineries becoming stranded assets – threatening China’s energy security. That threat is compounded if supplies from Iran – where ~90% of oil exports go to China – are also interrupted by changes on the geopolitical chessboard.

So, while it is certainly a worry that the United States may appear content to burn the democratic bridgehead in Europe to suit its own interests, it is also burning China’s bridgeheads in the Western Hemisphere and the Middle East. Is this net bullish or bearish for Pax Americana? The answer to that question ought to be helpful in directing capital flows in 2026.

Tyler Durden
Mon, 01/12/2026 – 13:05

Noem: DHS Sending “Hundreds More” Federal Agents To Minneapolis

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Noem: DHS Sending “Hundreds More” Federal Agents To Minneapolis

Authored by Jack Phillips via The Epoch Times,

Homeland Security Secretary Kristi Noem said in an interview on Jan. 11 that “hundreds more” federal officers will be sent to Minneapolis on Jan. 11 and Jan. 12 to carry out immigration-related operations in the city.

“We’re sending more officers today and tomorrow, they’ll arrive, there’ll be hundreds more, in order to allow our ICE and our Border Patrol individuals that are working in Minneapolis to do so safely,” Noem told Fox News’s “Sunday Morning Futures.”

DHS recently sent 2,000 federal immigration agents to the city. Noem said the operation is needed to go after illegal immigrant criminals in the Twin Cities area amid allegations of widespread fraud involving federal entitlement benefits.

Protests erupted after a Jan. 7 incident in which an ICE officer fatally shot a protester as she hit him with her car in an apparent attempt to flee.

Local Democrats, including Minneapolis Mayor Jacob Frey and Minnesota Gov. Tim Walz, have criticized Noem and ICE for the shooting and suggested that the federal government cease immigration operations in the city. Frey and Sen. Tina Smith (D-Minn.) said in separate interviews on Jan. 11 that state authorities should be included in the shooting investigation because the federal government has already made clear what it believes happened.

“How can we trust the federal government to do an objective, unbiassed investigation, without prejudice, when at the beginning of that investigation they have already announced exactly what they saw—what they think happened,” Smith said on ABC’s “This Week.”

Frey told NBC’s “Meet the Press” on Jan. 11 that local officials should be involved, saying: “Let’s have the investigation in the hands of someone that isn’t biased.”

The Trump administration has defended the officer who shot the protester in her car, saying that he was protecting himself and fellow agents. Video footage of the incident, which occurred in Minneapolis on Jan. 7, shows a woman in an SUV parked across the road and blocking traffic while honking her horn. Another video shows officers telling the woman to get out of the vehicle. She then lurches the vehicle forward, hitting an officer, in an apparent attempt to drive off, and he fires his gun, hitting her.

In response, Noem wrote on Jan. 11 an accompanying post on X that what happened in Minneapolis was a “domestic terror attack” targeting ICE agents and a “direct consequence of sanctuary politicians, like Tim Walz and Jacob Frey, who constantly demonize and vilify our brave officers.” She included video footage of similar comments to CNN.

“Sanctuary politicians are allowing situations around the country to become volatile, they’re not doing their jobs, and they haven’t for years,” Noem said. “In the interest of public safety I would encourage them to grow up.”

Noem and DHS have said that attacks on ICE agents have increased by 1,300 percent, with vehicular attacks increasing by 3,200 percent, on a year-over-year basis. In October 2025, a man armed with a rifle killed two ICE detainees at a federal office in Texas before shooting and killing himself.

The officer involved in the Minneapolis shooting was doxxed by people online and has been receiving death threats, according to White House border czar Tom Homan, who said in a Jan. 10 interview that the threats have extended to his family members.

Anti-ICE demonstrations erupted on Jan. 9 as a demonstration turned into a riot, with people throwing rocks, ice, and other objects at federal officers. Thousands of people marched in Minneapolis on Jan. 10 in response to the shooting.

Tyler Durden
Mon, 01/12/2026 – 12:25

Google & AI Startup Settle Teen Suicide Chatbot Lawsuits

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Google & AI Startup Settle Teen Suicide Chatbot Lawsuits

Google and artificial-intelligence chatbot startup Character.AI have agreed to settle a wave of lawsuits brought by grieving parents who claim AI chatbots emotionally manipulated – and ultimately destroyed -their children.

Megan Garcia with her son Sewell Setzer III. Photograph: Megan Garcia/AP

Court documents filed this week show the companies have reached settlement agreements in cases from Florida, Colorado, New York, and Texas, all alleging that Character.AI’s chatbots harmed minors through sexually charged conversations, emotional dependency, and encouragement of self-harm. The specific terms of the settlements remain secret and must still be approved by federal judges, ABC News reports.

The Florida case, the first and most explosive of the lawsuits, centered on the death of 14-year-old Sewell Setzer III, who killed himself in February 2024. His mother, Megan Garcia, alleged that her son was pulled into what she described as an emotionally and sexually abusive relationship with a Character.AI chatbot.

According to the lawsuit, the chatbot was modeled after a fictional character from HBO’s hit series Game of Thrones – and over time, the teen became increasingly detached from reality, isolating himself from family and friends while spending hours interacting with the AI.

In the final moments of his life, screenshots included in the lawsuit show the chatbot telling the boy it loved him and urging him to “come home to me as soon as possible.”

Garcia’s lawsuit accused Character.AI of deliberately designing bots that blurred the line between fantasy and reality, exploiting a child’s vulnerability for engagement and profit. A federal judge rejected the company’s attempt to dismiss the case on First Amendment grounds – a key ruling that opened the door to similar lawsuits nationwide.

Those lawsuits soon followed.

Families in multiple states filed complaints alleging that Character.AI chatbots normalized self-harm, encouraged suicidal thinking, and fostered emotional dependency in children who lacked the maturity to understand they were interacting with a machine.

Google was named as a defendant because of its deep ties to Character Technologies, which intensified after the tech giant rehired Character.AI’s co-founders in 2024 and entered into an AI partnership that critics say gave the startup credibility, infrastructure, and reach.

While Google has maintained that it does not operate Character.AI’s platform, plaintiffs argue the company played a critical role in enabling the technology that allegedly harmed their children.

The settlements arrive amid broader legal pressure on the AI industry, including lawsuits against OpenAI, the maker of ChatGPT, over claims that its technology has encouraged self-harm or failed to intervene appropriately during mental-health crises.

In response to the growing backlash, Character.AI has rolled out new safety measures, including age restrictions and content moderation tools. But for families who say the damage has already been done, the changes come too late.

Tyler Durden
Mon, 01/12/2026 – 12:05

The Pyramid Was Wrong. Local Food Was Right All Along

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The Pyramid Was Wrong. Local Food Was Right All Along

Authored by Mollie Engelhart via The Epoch Times (emphasis ours),

I never cared about the food pyramid.

Not once. Not when it hung in classrooms, not when doctors repeated its logic, and not when federal agencies insisted that grains outranked everything else.

Illustration by The Epoch Times, Shutterstock

I grew up in a family where food wasn’t a recommendation—it was our economy and our culture. There was always a garden, always bulk bins of staples, always bread baked by hand. We preserved, canned, and stored what we could from the soil and orchard—cherries, apples, seasonal fruit—long before “farm-to-table” became a career path people marketed instead of lived.

As I got older, even when I lived in immaculate golf-course communities, I kept returning to the same truth: Food should be grown, handled, and circulated locally. My chickens earned HOA violations. My vegetable beds violated CCRs. Planting fruit trees in my front yard went against neighborhood covenants. But nourishment was always my compass—not their rules.

That compass shaped my career. I built restaurants around farmers and relationships, not federal charts. Even when I was vegan, we sourced what made sense for the place—apples from nearby growers, cherries when the trees gave them, vegetables from people we knew by name, like our friends at Anna Ayala Farms when I lived in California.

Later, when I tried to transition my restaurants toward regenerative meat, dairy, and vegetables, it didn’t succeed financially. But it was always true to me. My conviction didn’t begin with MAHA. It began with lineage, instinct, motherhood, and feeding people well, even when the market resisted it.

So yes, when the Dietary Guidelines for Americans 2025–2030 were released in January 2026, and the food pyramid was finally inverted, many of us saw it as a long-overdue win. And it is a win.

But any hunting culture could have told you long before 1992 that the original pyramid was flawed. Traditional hunting cultures always prioritized the most calorie-dense, nutrient-rich foods—fat, protein, organs, energy that lasts. Ancient wisdom didn’t fear calories—it revered them. Survival depended on them, which means we should have known. And we did know. The guidance was flawed from the beginning, had anyone bothered to cross-check it against nature or history.

But gratitude for the correction doesn’t erase the larger question: Who is accountable for the harm?

Nutrition policy doesn’t stay on posters. It becomes school lunch standards, federal food programs, and medical talking points. For decades, the federal model warned against fat, elevated grains, and left the door open for processed foods to dominate institutional feeding environments.

Critics have long argued that the original USDA pyramid—and later the MyPlate model, which didn’t restrict processed carbohydrates or added sugars—reflected strong food industry lobbying and agricultural commodity interests rather than biological science.

Nutrition historians note that the 1992 pyramid’s recommendation of 6 to 11 daily servings of grains was widely criticized, even at the time, by experts, including researchers at Harvard, for ignoring metabolic science and traditional dietary knowledge.

In the meantime, the country got sicker. Childhood obesity rose sharply after the 1990s. Type 2 diabetes began appearing in adolescents by the 2000s. Metabolic dysfunction was normalized as inevitable aging, rather than the biological debt of policy error and corporate influence.

I watched it happen from the outside, insulated by the way I grew up. But millions of kids learned what food looked like from a cafeteria built on that inverted logic. They were conditioned to crave refined starches and sugar-loaded convenience foods—meals engineered for profit, not nourishment.

And those kids are now adults, carrying inflammation, disease, and addiction to processed carbohydrates into young adulthood and middle age: diabetic charts, cardiac events, cancer diagnoses, and bodies trained to mistrust their own instincts instead of their lunches.

I know marriages that were destroyed by unscientific COVID-19 policies. I lived the collapse of my own businesses under decisions made far from communities and far from human biology. And when those policies tore families, livelihoods, and health trajectories apart, no one had to sign their name publicly or carry responsibility for the fallout.

This is where I stop applauding and start asking for receipts. Because accountability isn’t optional when the consequences span generations. When bureaucrats, agencies, and corporate interests make decisions that shape national feeding environments, who answers for the harm? Who signed the papers that allowed ketchup to count as a vegetable? Who approved school meals that trained children toward metabolic dysfunction? Who carries responsibility when public policy serves corporate profit over public health?

The inverted pyramid is exciting. I hope the ripple effect of the new model becomes equally immeasurable—a turning tide toward real nourishment, local food economies, and restored trust in instinct. But we cannot pretend that late corrections erase the need for accountability.

Because here’s the truth, stated plainly: The ripple effect of the previous food pyramid is immeasurable, and the wake of metabolic dysfunction it left will take at least 50 years to repair. And we all know this isn’t the only place where bureaucrats, three-letter agencies, and corporate interests are harming the people.

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

*  *  * GRAB SOME SEEDS! 

Tyler Durden
Mon, 01/12/2026 – 11:45

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