After a solid 2Y auction and a subpar 5Y auction earlier this week, moments ago we got the week’s final Treasury issuance when the US auctioned off $44BN in 7Y paper in a perfectly average sale.

Starting at the top, the bond priced at a high yield  of 4.260%, down modestly from 4.290% last month and in the middle of a range established in late-2023 after which the 7Y has traded between 3.50% and 5%. The auction also priced on the screws with the When Issued which was also at 4.260. 

The bid to cover was 2.498, just under last month’s 2.516 and on top of the 6-auction average of 2.488%.

The internals were a bit weaker: after Indirect bidders took down a record 78.4% in May, today their demand crashed to earth and foreign buyers ended up taking down just 57.55%, the lowest since Sept 26. And with Directs taking down 29.7%, a big jump from 11.2% in May but in line with the recent average, Dealers were left holding 12.75%, up from 10.42% a month ago and the highest since November.

Overall, this was a average-to-weak auction, with sufficiently good metrics even if the internals were a bit on the weak side. Not that the market cared (about this, or anything else); with 10Y yields extending their drop all day today, the meh auction barely registered. 

Via American Greatness,

A federal judge on Wednesday permanently blocked key portions of President Donald Trump’s executive order overhauling federal election procedures, ruling that the president exceeded his constitutional authority by attempting to impose new voting requirements without congressional approval.

U.S. District Judge Denise Casper, an appointee of former President Barack Obama, concluded that the Constitution gives primary authority over elections to the states and Congress, not the executive branch.

The ruling makes permanent a preliminary injunction Casper issued last year in a lawsuit filed by Democratic attorneys general from 19 states.

“While the Constitution vests the President with ‘executive Power’ and commands him to ‘take Care that the Laws be faithfully executed,’ it does not grant the President any specific powers over elections,” Casper wrote.

“As a result, the President ‘plays no direct role in the process of appointing electors,’ nor does he have authority to control the state officials who do,” she added.

Trump’s executive order sought to require documentary proof of U.S. citizenship to register to vote, prohibit states from counting mail ballots received after Election Day even if postmarked on time, and withhold certain federal funds from states that declined to comply.

Casper ruled that the administration lacked the authority to impose those changes through executive action.

In her 59-page opinion, the judge also rejected the administration’s justification for the order, writing that the Justice Department failed to establish the widespread election problems it cited in defending the policy.

“There is no evidence in this record of widespread ‘illegal voting, discrimination, fraud, and other forms of malfeasance and error’ within American elections, which the Executive Order purports to safeguard against,” Casper wrote.

The judge also concluded that the order would have disenfranchised thousands of voters.

The decision is another legal setback for the administration’s efforts to repair federal election procedures. Courts have repeatedly blocked or limited several election-related initiatives advanced during Trump’s second term.

Additional lawsuits are challenging a separate executive order aimed at creating a nationwide voter database and tightening mail voting requirements. Earlier this week, another federal judge blocked the administration’s attempt to use an immigration database to verify voter rolls, while courts have also rejected Justice Department efforts to obtain state voter registration records.

Despite the court rulings, Trump has continued urging Congress to enact proof-of-citizenship requirements through legislation.

The Republican-backed SAVE America Act passed the House but remains stalled in the Senate.

Trump renewed that effort Wednesday, saying he would withhold his signature from a bipartisan housing bill until Congress approves voter citizenship verification requirements.

By Molly Schwartz, cross-asset strategist at Rabobank

A river in Egypt

Scott Bessent took to CNBC’s Squawk Box yesterday to opine on the situation with Iran. Bessent echoed Trump’s comments that any released Iranian assets are to remain under US Treasury oversight and are restricted to use for food and medicine. However, money is fungible, and any released cash that is used to help civilians may mean more cash from other places that can be used to support the IRGC’s interests

Bessent’s comments also called attention to another philosophical outlook on the war and the Administration’s initially stated— though seemingly not truly intended—goal of regime change. This is where the waters gets murky, and where we can climb into our Felucca and begin our journey along a river in Egypt, drifting, perhaps, into a bit of strategic “denial” about what regime change actually means. If, hypothetically of course, Operation Epic Fury succeeded in asserting regime change in Iran, where does the US go from here? If the new Ayatollah says he is willing to table plans of further enriching uranium and wants to align itself with US interests, should the US just keep firing missiles? Do you keep Iranian assets under lock and key, even if the regime has shown you that it has changed?

.@SecScottBessent: “Dollar dominance is essential, and everything @POTUS is doing here — if you look, the new Venezuela… the dollar is going to be the centerpiece of their trade… We’re seeing in the Iranian negotiations, the Iranians will be invoicing in dollars. Everything… pic.twitter.com/5IsPYo8aSh

— Rapid Response 47 (@RapidResponse47) June 24, 2026

Bessent said himself, “we didn’t have a regime change, but we have changed the regime.” If that is the genuine perspective of the Trump Administration, then the deal may not be as bad for the US as many perceive it to be. As our Global Strategist, Michael Every, has noted on multiple occasions, show of strength means everything in the arena of Middle Eastern geopolitics. There is a possibility that the current hardliners in the IRGC aren’t actually so hardline anymore, but are only presenting as such. Note that this is not a new base case for our outlook by any means (you can read more about our Hormuz outlook here), but food for thought.

If the regime truly has changed, this also could have big implications for USD dominance. Bessent noted that a born-again Venezuela is shifting back towards USD invoicing, and that post-deal Iran is likely to do so as well.

Brent crude oil fell below $75/bbl for the first time since the war in Iran began, sending US Treasury markets into a tailspin. US 2-year yields dropped almost 6bp to 4.21, while the 10-year sunk almost 10bp—the largest one-day downward move since October 2025. With “peace in the Middle East,” the case for hikes is losing water by the day, with the market now pricing in 27bp worth of hikes by October, and only 40bp worth of hikes at the peak—a significant downgrade from Monday, when two full hikes had been priced in by the April 2027 FOMC decision.

Such a dramatic move in rates would normally suggest a weaker dollar, but USD was actually the best-performing G10 currency on a one-day view and the best month-to-date. The DXY index continued its climb from last week’s FOMC meeting to 101.6—the highest level since May 2025. Meanwhile, EUR/USD broke below crucial support at 1.14, fueling additional EUR selling, with the pair trading at 1.1356 at the time of writing. While the following appears to be more of an instance of correlation rather than causation, it is also important to note that yesterday’s move coincided with comments from Bessent—perhaps another slow turn of the Felucca—that USD can remain strong even when interest rates are being cut.

While USD is soaring, JPY is plummeting. USD/JPY spent the day yesterday approaching the July 3, 2024 high of 162, with the 14D RSI at 71.83 suggesting that USD/JPY is overbought. According to Bloomberg, Bessent and Japanese Finance Minister Katayama spoke over the phone, with Katayama telling reporters that “she and Bessent agreed to take ‘bold’ steps on currencies if needed,” and said the nations are increasingly “aligned” on foreign-exchange policy.

The Bank of Canada released its Summary of Deliberations from the June 10 decision, written on papyrus. Recent Canadian economic data suggest that the Canadian economy has slipped into a technical recession, with two consecutive quarters of negative quarterly growth. The Governing Council piled into a felucca of their own, racing up de Nile, justifying that higher-frequency data suggest a “resumption of growth in the second quarter,” and that while the Canadian economy is weak, it is “not clearly in a recession.”

French President Emmanuel Macron has announced yet another highly provocative naval seizure of a Russian so-called shadow fleet vessel. 

“On Tuesday, the French navy boarded the oil tanker Deliver as it was passing off the coast of Sicily in breach of maritime law,” Macron wrote in a post on X, revealing the prior interdiction that took place earlier in the week.

Reports say it flew a Cameroonian flag and was sailing from Russia’s Baltic port of Primorsk, whereupon it was boarded by French forces over a falsified registration, according to the French maritime prefecture.

France’s navy escorted then the tanker to an anchorage location, where it was subject to deeper inspections my maritime authorities.

It marks no less than the fifth such boarding of a ‘shadow fleet’ vessel suspected of transiting sanctioned Russian goods or energy off a European coastline since September.

“We will not allow the ‘shadow fleet’ to circumvent sanctions and finance Russia’s war effort,” Macron said.

The apparent legal justification France’s navy has relied on for such actions is the practice of “flag-hopping” – which involves a crew repeatedly changing displayed flags, along with often invalid registrations to thwart international tracking monitors.

The last several seized tankers were also flying flags of African nations, and these interdictions have stretched back through last year. 

France’s military released footage of the boarding of the ‘Delivery’…

French President Emmanuel Macron has announced that the French military intercepted the Russian “shadow fleet” tanker ‘Deliver’ on Tuesday as it transited off the coast of Sicily in violation of maritime law. pic.twitter.com/T3sE95BrT1

— OSINTdefender (@sentdefender) June 25, 2026

In some instances, Russia has been sending military escorts – which of course has seen French and European militaries hold off executing any action.

As a result of this latest intercept, it’s likely Russia’s navy will increase its military escorts, which has been more common in northern European waters, given the proximity to Russia.

By Irina Slav for OilPrice.com

President Donald Trump has listed Exxon, Chevron, Shell, and BP as being among companies responsible for excessively high fuel prices, following the announcement of a federal government probe into price-gouging earlier in the week.

“Oil prices have come down so much and we are not seeing anything at the pump by comparison the way they should be,” the U.S. president told media, as quoted by the BBC. “We should be, in my opinion, at $2.25 [a gallon] right now at the pump and we are higher than that.”

The U.S. national average for a gallon of regular gasoline was $3.928 as of Wednesday, down from $4.0250 a week ago, but up from $3.2240 a year ago, according to AAA data. GasBuddy reported a national average of $3.85 per gallon as of Monday. Still, fuel prices have been on a decline for six weeks in a row, with diesel also dipping below $5 per gallon for the first time in weeks, bringing relief to industrial fuel consumers.

“The big Oil Companies are not dropping their price at the pump commensurate with the sharply lower prices they are paying for Oil. Those prices are dropping ‌like a rock! In other words, customers are being “gouged”,” Trump wrote on TruthSocial late on Tuesday. “I have instructed the DOJ to immediately start looking into this. Gasoline prices better start going down a lot faster than what I’m seeing!” the U.S. president also wrote.

In response, the American Petroleum Institute said that retail fuel prices “don’t move in lockstep with crude oil”. “Our industry shares the goal of delivering relief at the pump and restoring stability to global energy markets,” API spokeswoman Bethany Williams also said.

“President Trump was clear all along that there would be short-term, temporary disruptions to energy markets, and that oil and gas prices will quickly fall as soon as the Iran situation is resolved,” a White House spokesperson told media, as quoted by the BBC.

Readers were warned as early as late January to front-run the coming memory shortage by purchasing their favorite electronics, whether PCs, laptops, TVs, smartphones, or anything else dependent on high-end memory chips, as unprecedented data-center demand was already beginning to emerge.

Fast forward nearly five months, and just two weeks after Apple CEO Tim Cook warned that “price increases are unavoidable” for laptops and other devices, a Wall Street Journal report has confirmed that those hikes have now been passed along, potentially delivering sticker shock to customers.

Here’s what happened earlier: The Apple Online Store briefly went down, and when it came back online, prices for Mac computers jumped 15% to 20%, while iPad prices increased 15% to 25%.

The company briefly took down its Apple Online Store early this morning as it typically does when announcing new products. When it came back online, the price tags for Mac computers rose roughly 15% to 20% and iPad prices rose 15% to 25%. Among the price increases, the base MacBook Air rose $200 to $1,299; the base MacBook Pro increased $300 to $1,999; the entry-level MacBook Neo increased $100 to $699. The iPad Air increased $150 to $749 and the iPad Pro increased $200 to $1,199. -WSJ

Vision Pro became even more unaffordable.

*APPLE RAISES VISION PRO HEADSET PRICE TO $3,699 FROM $3,499

*APPLE HOMEPOD NOW $349, HOMEPOD MINI IS $129, APPLE TV TO $199

— zerohedge (@zerohedge) June 25, 2026

However, iPhone prices remained unchanged, but the company told the outlet in a statement that additional price hikes could be on the way.

“We have now reached a point where we need to begin raising prices,” Apple said in the statement. “We have never seen a component price increase this much, this quickly.”

An Apple spokesperson placed the blame on the “rapid expansion of AI data centers, which has created an extraordinary surge in demand for memory and storage,” and this is why component prices surged.

Earlier this month, Cook told WSJ that price increases had become “unavoidable” because of higher component costs, adding, “There’s less supply at a time when consumers want devices, and the memory guys are passing along huge price increases.”

Apple has historically revealed price hikes with new launches of iPhones, iPads, and other devices, making this overnight price hike extraordinarily rare.  

The high-end chip market is dominated by US-based Micron and South Korea’s SK Hynix and Samsung, which have all seen massive demand for high-bandwidth memory from AI “hyperscalers” such as Google, Meta, and Amazon.

Apple’s price hikes come hours after Micron delivered blowout quarterly earnings, touting gross profit margins that topped 80%. Shares soared nearly 18% in premarket trading.

Micron executives told investors that “tight conditions” will persist beyond 2027 and that only suggests further price hikes are coming not just for Apple but also for other major big tech firms that sell devices.

Micron Chief Business Officer Sumit Sadana said in a WSJ interview last night that “a couple of the customers who were being very aggressive with pricing at that time were not constructive,” without naming Apple…

Sadana noted, “A lot of the industry investments got shut down in 2023 because of really poor pricing and really poor margins.”

A recent Morgan Stanley note found that memory prices have climbed sixfold over the past year, with new manufacturing capacity likely to take years to build and ramp up.

The iPhone price hike may be unavoidable: JPMorgan analysts estimate DRAM and NAND could jump from roughly 10% to 15% of an iPhone’s total component cost today to more than 45% by 2027.

Memory price spikes are already showing up in the Producer Price Index for semiconductor and other electronic component manufacturing.

At what point does Trump start raging at soaring memory prices

PPI Electronic Components is pulling entire core index higher pic.twitter.com/v9ufHmx0gG

— zerohedge (@zerohedge) June 11, 2026

… and at what point does President Trump start raging at memory prices, just as his administration has successfully sent oil prices crashing by entering a diplomatic phase with Tehran to secure a permanent peace deal?

Via Remix News,

A 19-year-old Afghan man, Massoud S., was tried Monday at the Aix-en-Provence court for sexual assault against six goats, one of which died, and a 6-month-old lamb at an educational farm. He has been convicted and sentenced to 30 months in prison and a ban from French territory.

Afghan migrant Massoud S. was initially charged with “serious abuse or act of cruelty against a domestic, tame, or captive animal.” He continued to deny the rapes in this case despite DNA evidence and being caught redhanded raping a goat. He even told a court psychologist that anyone who did rape the animals only did it to “not rape a woman” since “a goat could not identify him afterward.”

The sexual assaults occurred between February and April and on top of the DNA evidence, his phone location also had him pinged to the crime scene.

“I don’t know how to explain it,” he told the magistrates regarding the ample evidence against him.

Massoud S. reportedly repeatedly raped the animals, which all belonged to an animal shelter and educational farm “Un moment” in Les Pennes-Mirabeau, near Marseille.

Cassandra Sortino, the owner of the establishment, remains deeply traumatized by the mass rape of her animals by the Afghan man.

“We set up this association to do good, and the animals were in danger in our own structure. We cannot explain it morally,” she testified. “We feel like we failed.”

According to Swiss outlet 20 Minutes, “Representing herself without a lawyer, she searched in vain for an answer to her central question: why?”

The incident began in February when she noticed that there were ligature marks on some of the animals’ legs. A veterinarian discovered injuries to the animals’ genitals and traces of blood.

This was enough evidence for Sortino to install a surveillance camera, where she saw a man sneaking into her property and raping animals. She remained in contact with police, and in April, the Afghan man was finally arrested. At the moment he was apprehended, police discovered the man in the middle of the act of raping the goat, wearing latex gloves, and with his pants down.

Massoud S. claimed that he was in the barn because he missed his train on the night he was arrested to Marseille, where he lives in an asylum seeker center in the city’s 3rd arrondissement.

Massoud S. required a translator during his trial but said he felt “full of shame” when describing his strict religious upbringing. He arrived in France in November 2025 and claims he lost his family during a bombing raid in his home country.

A psychiatrist reported the man suffers from no mental disorders, however, he reportedly said while talking about the rapes: “We make a big deal out of it when they’re just animals,”

“I’m a normal person,” he said when confronted with these statements in court.

He has been sentenced to 30 months in prison for charges reclassified as “abuse leading to death.” He is also banned from French territory and must register into a database for sexual offenders.

Sortino is not done with the Afghan and plans to appeal the sentence.

“I would have liked to understand,” Sortino said.

Previous cases

Last year in Germany, a shocking case has emerged from the beautiful town of Oberneufnach in Bavaria, which involved a 52-year-old Turkish asylum seeker allegedly breaking into a stable and sexually abusing ponies.

The man, who is from a refugee shelter in the nearby town of Anhofen, was arrested after he was caught on surveillance video.

The man broke into the horse farm at 6:45 p.m. while the family was having dinner. They heard the dog barking and then looked on surveillance monitors, where they saw the man in the stable with his pants down on top of one of the animals.

The boyfriend then ran to the stables to chase down the man, but he had already fled the scene. He continued his pursuit of the suspect though and eventually caught him. Police arrived and placed the man under arrest.

In 2023, a 27-year-old suspect was arrested after he was caught on a surveillance camera raping a pony at a stable south of Hamburg. The 18-year-old pony, which is named “Carrie,” was abused by the man at 1 a.m., with footage showing the man calmly walking onto the property and starting to attack the defenseless animal.

Steffi B. released the footage to German newspaper Bild, which posted stills of the perpetrator on its web publication.

The attack happened in Birkenmoor, which is in Harburg, just a few kilometers from the Hamburg city center.

Even the petting zoo at the park has not been safe. In 2017, a Syrian migrant raped a pony there in front of children.

“My babysitter was out with our son in Görlitzer Park. They witnessed the man sexually assault the pony,” one woman told Berliner Morgenpost at the time. The babysitter took a photo of the man as he raped the pony and provided it to police. The migrant was banned from the petting zoo in response, but it is unclear if he was ever charged by police.

Read more here…

President Donald Trump formally asked Congress on Wednesday for $87.6 billion in supplemental appropriations – your tax dollars (for our American readers) – to cover urgent needs stemming from the U.S. military campaign against Iran, provide economic relief to American farmers, and respond to the Ebola outbreak in Central Africa.

The request, sent in a letter to House Speaker Mike Johnson, comes as the administration seeks to replenish military stocks and address operational expenses from Operation Epic Fury, the joint U.S.-Israeli military effort launched on February 28, 2026.

Breakdown of the Funding Request

According to the White House letter and reporting from multiple outlets, the package allocates funds across several priorities:

• Department of War (Pentagon): $67.146 billion – the largest share. This includes approximately $21 billion for munitions to rebuild stockpiles, substantial funding for operations and readiness, $2.4 billion for drones, $5.1 billion for cybersecurity and autonomy, fuel costs, and $12.1 billion for classified programs.
• American Farmers (USDA): $11.1 billion – $10 billion in temporary economic assistance for row and specialty crops in 2026, plus $1.1 billion to help Florida agricultural producers recover from winter storm damage.
• Ebola Outbreak Response: $1.4 billion – focused on detection, contact tracing, surveillance, humanitarian assistance in the Democratic Republic of Congo, Uganda, and Kenya, plus medical evacuation and departure support for U.S. citizens.
• Infrastructure and Other: $500 million for restoration and capital projects in Washington, D.C.; $1 billion toward modernizing Penn Station in New York City; plus smaller amounts for the Department of Energy and other items.

The administration described most of the request as addressing “urgent needs related to Operation Epic Fury” while also tackling other critical domestic and international priorities.

Background: Operation Epic Fury

Operation Epic Fury – the Israeli-US (Master-Blaster) war on Iran which has split the Republican party in exchange for no obvious benefit to Americans who are on the hook for tens of billions of dollars – saw four months of intense fighting from late February to early May 2026. The goal was to destroy Iran’s ballistic missile capabilities, missile and drone production facilities, navy, air defenses, and efforts to develop or acquire nuclear weapons and related technology.

Diplomatic efforts continue, including a June 2026 memorandum of understanding signed in Islamabad aimed at formally ending the conflict within a 60-day window, though disputes remain over issues such as IAEA access to damaged nuclear sites.

The Trump administration has characterized the campaign as a decisive success achieved through “peace through strength,” while critics have raised questions about costs, civilian casualties in some strikes, and broader strategic outcomes.

Political Reactions and Congressional Outlook

The supplemental faces a challenging path in Congress. It requires bipartisan support to advance in the Senate, where 60 votes are typically needed to overcome procedural hurdles.

• Democrats have largely opposed funding what many describe as an unnecessary or illegal war and are expected to resist the package.
• Republicans show divisions: Many support replenishing military capabilities and providing farm aid, but some express skepticism about the war’s handling and costs. Farm-state lawmakers are already signaling they may seek to increase the agricultural assistance beyond the proposed $11.1 billion.

House Republican leaders have indicated they will review the details carefully, citing Congress’s constitutional role in funding national defense. The request arrives amid broader debates over the administration’s push for a significantly larger Pentagon budget.

The package also includes regulatory updates favored by some farm-state Republicans, such as measures related to hemp-derived products and year-round sales of E15 ethanol-blended fuel. These provisions aim to support agricultural interests but have drawn opposition from other sectors.

Bundling military, humanitarian, agricultural, and infrastructure spending in one supplemental is a common legislative tactic but often draws criticism for obscuring priorities or adding unrelated items.

What Happens Next?

Congressional appropriators will now examine the request. Passage is far from guaranteed given partisan divides over the Iran conflict and competing budget priorities. The administration has urged swift action, emphasizing the need to restore military readiness and address other urgent matters.

This supplemental represents one of the largest emergency funding requests in recent years, reflecting both the scale of the military operation against Iran and the administration’s efforts to address domestic economic pressures on farmers and global health risks.

The number of Americans filing for unemployment benefits for the first time fell last week to 215k (after hitting four month highs last week), well below the 225k expectations and back to the same levels it was at in 2021…

New Jersey and Oregon saw the biggest WoW rise in initial jobless claims while Minnesota and Pennsylvania saw the biggest decline…

At the same time, continuing jobless claims picked up to 1.821 million Americans – the highest in 3 months…

The bottom line is that initial claims remain low by historical standards and continue to run below year-ago levels, reinforcing the more hawkish ‘labor market is resilient’ framework introduced last week.

After accelerating in March and April, The Fed’s favorite inflation indicator – Core PCE (a measure of price changes in consumer goods and services that excludes volatile food and energy costs) – was expected to rise once again in May.

And it did with the crucial inflation signal up 0.3% MoM (as expected) and up 3.4% YoY (as expected) and at the highest level since Nov 2023…

Services costs picked up again with Durable goods flat and non-durable goods inflation decelerating…

The headline PCE jumped 0.4% MoM (slightly less than the 0.5% exp) and up 4.1% YoY (as expected) – highest since April 2023…

The impact of the war is evident in crude prices and the PCE’s energy index, but arguably, this is as bad as it gets in terms of inflation…

But PCE signals that the soaring cost of semiconductors (the software and accessories component receives about 30 times the weight in PCE as it does in CPI) – has stalled…

Higher prices were met with higher spending (+0.7% MoM notional) and higher income growth (+0.7% MoM)…

While Spending has been accelerating, income growth HAD been slowing but accelerated markedly last month…

…with both private sector and government workers seeing wage growth acceleration…

Spending continues to run well ahead of inflation (real personal spending up 2.1% YoY)…

Despite an upward revision to the personal savings rate every month of 2026, May was 3.0%, still lowest since 2022

With the savings rate barely above record lows, it seems that Americans are digging into their savings to keep up with inflation. No wonder sentiment is so low…

Howver, as Goldman’s Rich Privorotsky notes, the challenge is that most inflation data now feels inherently backward looking, predating the collapse in oil back toward pre-conflict levels.

Given Warsh’s new mantra of no forward guidance we probably should have more volatility around these releases than we have seen historically.