UBS Says Soaring Memory Chip Prices To "Turbo-Charge" Samsung Earnings

For several months, we have tracked a sharp increase in DDR5 DRAM pricing, as evidenced by DRAMeXchange data, driven primarily by surging AI-related cloud computing demand and hyperscalers accelerating data center buildouts.

On day one of the new year, Samsung co-CEO Jun Young Hyun told employees in an internal memo that customers have praised the differentiated competitiveness of its next-generation high-bandwidth memory (HBM) chips, or HBM4, saying, "It's even earning an assessment from customers that 'Samsung is back'." He noted that Samsung will also benefit from favorable memory market conditions this year, as demand for artificial intelligence chips has materialized much quicker than initially anticipated.

The other week, Goldman analyst Maho Kamiya told clients that mounting concerns about soaring memory prices posed new risks for Nintendo, which manufactures consumer electronics such as the popular Switch 2.

"Some investors think that Nintendo will be selling Switch 2 at a loss and gross profit falling into the red. While rising memory prices are a risk factor that could depress hardware margins, we think concerns are somewhat excessive," Kamiya told clients last week.

While end-use consumer electronics companies such as Nintendo may be pressured by higher memory costs, the same pricing surge is expected to "turbo-charge earnings" for Samsung's memory business, according to UBS analyst Nicolas Gaudois.

Gaudois explains why:

DDR and NAND contract pricing coming out higher than expected

With 4Q25 memory contract pricing negotiations now completed, we lift our forecast for DDR contract pricing to +35% QoQ (was +21%), and for NAND +20% (was +15%). We believe customers are trying to secure 1Q26 contract pricing in earnest, with further potential for upside. We now forecast blended DDR contract pricing to increase 29% QoQ (was +15%) and NAND +20% (was +10%) in 1Q26. From there on, we continue to forecast DRAM to remain undersupplied until 1Q27, and NAND 3Q26. We see the ongoing upside in conventional memory pricing as the main stock driver for Samsung. At 1.43x NTM book, we believe the stock is not yet discounting the strength and length of the upcycle ahead.

HBM shipments to catch up in 2026E

While we maintain our 2026 DRAM bit growth forecast of 15% YoY, we could see up to 2 pct pts upside depending on production yields / efficiency / mix. We continue to forecast HBM shipments to reach 7.5bn Gb in 2026, up 77% YoY. We continue to expect Samsung to provide HBM4 samples to Nvidia by February, which could lead to qualification by 2Q26 (with production starting earlier in 1Q). We believe Samsung remains first source for HBM for AMD and Open AI. Regarding Google, we believe Samsung is second source for TPU 7p, while Micron may be second source for TPU 7e (first source in both cases being SK Hynix).

Increasing forecasts well ahead of consensus on DDR/NAND ASP estimates

We increase our 4Q25 OP forecast to Won18.1tn from Won15.0tn (VA consensus: Won15.3tn) on the back of increased DRAM and NAND ASPs. We raise 2026E/27E OP to Won135.3tn/Won143.6tn (from Won101.2tn/Won109.5tn respectively), well ahead of consensus Won86.9tn/Won109.6tn respectively, and lift our 2026/27 EPS forecasts by 31%/29%. These changes are due to raised DDR/NAND ASPs as well as DRAM bit growth forecasts, which more than offset us lowering smartphone margins due to rising memory prices.

Valuation: lift price target to Won154,000 from Won128,000 – Buy

We value Samsung ordinary shares at 1.97x NTM book (was 1.79x) considering our 2026-30 average ROE estimate of 16.3% (was 14.6%) and CoE of 8.3% (was 8.2%). We also raise our Samsung GDR PT to US$2,610, from US$2,230, with the latest FX.

We've shown readers DDR5 DRAM pricing via DRAMeXchange...

Update: two months later https://t.co/Q4TPIrpzxV pic.twitter.com/O3KTKxZOVE

— zerohedge (@zerohedge) December 22, 2025

But now, take a look at DDR5 DRAM pricing on Amazon!

As a reminder, AI workloads are built around memory.

ZeroHedge Pro Subs can view the full note in the usual place, which includes a thesis map of the memory cycle.

Tyler Durden Fri, 01/02/2026 - 12:40

10 Very Important Trends To Watch As We Enter 2026

Authored by Michael Snyder via TheMostImportantNews.com,

Are we on the brink of a worldwide nightmare? Many have described what we are currently experiencing as a “perfect storm”. We have been getting hit with one crisis after another as global events have greatly accelerated in recent months. But now it feels like the next chapter that we are entering is going to take things to an entirely different level.

On New Year’s Eve, something very unexpected happened at our most important landmark in the middle of the country.  You will want to read all the way to the end of this article to see what I am talking about.  This year is already off to a very unusual start, and I fully expect a lot more craziness in the months ahead.  

The following are 10 very important trends to watch as we enter 2026…

#1 The Price Of Silver

The price of silver is telling us that there is big trouble under the surface of the global financial system.  Even though there was a dramatic attempt to suppress the price of silver this week, it was still up about 140 percent in 2025.

And the difference between the price of paper silver and the prices that physical silver is going for around the world has become extremely alarming…

Silver at $130 in Japan, $106 in Kuwait, $97 in Korea, and “$71” on Western screens is not a market; it is a confession. The numbers read like a crime scene diagram: in the real world where bars change hands and coins disappear into safes, silver has quietly migrated into triple‑digit pricing, while the supposed “global benchmark” in New York and London is still stuck in a fantasyland of leveraged promises.​

In Tokyo shops and Japanese bullion counters, you are not buying silver in the 70s; you are paying the equivalent of $120–130 an ounce because that is what it costs to replace inventory once you factor in tight wholesale supply, shipping, insurance, currency chaos, and the growing sense that the next shipment might not show up on time, or at all. Kuwait tells the same story in a different language: retail bars priced around $100+ an ounce are not a fat merchant’s greed; they are the market’s answer to a simple question—what will it really take to pry physical metal out of the pipeline in a world where everyone suddenly wants the same scarce asset at the same time.​

#2 The Affordability Crisis

In 2025, I wrote about the affordability crisis in the United States a lot.

Sadly, at this stage approximately two-thirds of the entire U.S. population is struggling to even pay for the basics…

About 7 in 10 Americans polled by CBS News in December said they were struggling to pay for food, housing and health care, underscoring the affordability issues affecting millions of households.

#3 Israel And Iran

This is a big one.

Once Israel and Iran start fighting again, global events will go into overdrive.

Apparently a new round of airstrikes on Iran was discussed during Israeli Prime Minister Benjamin Netanyahu’s meeting with President Trump on Monday, and I am convinced that it won’t be too long before those airstrikes actually begin…

On Monday, Prime Minister Benjamin Netanyahu met with President Donald Trump at Mar-a-Lago, during which the two leaders discussed efforts by Iran to reconstitute its nuclear program following the Israeli and American airstrikes in June, and to expand its ballistic missile arsenal.

During the meeting, Netanyahu shared with Trump details regarding Israel’s planning for a possible follow-up air campaign against Iran, should Tehran continue to refuse to halt its efforts to enrich uranium.

According to a US official and two other American sources, Israel is considering airstrikes in 2026.

#4 The War In Ukraine

Russian forces are steadily moving forward on the eastern and southern fronts in Ukraine, and so the Russians will not be inclined to give the Ukrainians and our European allies what they are demanding…

• Russian President Vladimir Putin inspected a command post of the Russian Armed Forces
• Putin received reports from Chief of the General Staff Valery Gerasimov and the commanders of Russia’s Center and East groupings of forces.
• Russian commanders told Putin that their army has captured the cities of Mirnohrad, Rodynske, and Artemivka in Ukraine’s Donetsk region, as well as Huliaipole and Steponohirsk in the Zaporizhzhia region.

#5 Europe Preparing For War

Russia has made it very clear that it does not intend to attack any other European countries.

But for some reason, the Europeans are feverishly preparing for war anyway.

In fact, Germany is now requiring all 18-year-old males to complete a compulsory survey about military service…

Germany is stepping up preparations for war – starting with its teenage boys.

From this week, every German male will be legally required to answer questions from the army the moment he turns 18, as part of a sweeping new military service scheme approved amid mounting fears of a major conflict in Europe.

Tens of thousands of teenagers will be sent a compulsory 14-question survey by the Bundeswehr, asking not only how interested they are in joining the military, but how fit they are to fight and how quickly they could be ready for service.

Ignoring the form is not an option. Young men who refuse to complete the questionnaire – or repeatedly ignore follow-up demands from the army – face fines of up to €1,000 (£800), even though ministers insist the scheme falls short of full conscription.

#6 Venezuela

The Trump administration has been bombing drug boats, seizing oil tankers and threatening the regime of Venezuelan President Nicolas Maduro.

This could put the U.S. on a collision course with China.

China does not intend to stop buying oil from Venezuela.  If the U.S. starts seizing Chinese oil tankers that approach Venezuela, that could cause a major international incident.  According to Newsweek, there are two Chinese oil tankers that are expected to arrive in Venezuela very soon…

Chinese oil tankers are pressing ahead with Venezuela-linked voyages despite a U.S. blockade and an escalating campaign of tanker seizures.

Two Chinese-flagged VLCCs are operating near Venezuelan waters, with the Thousand Sunny due to arrive in mid-January and the Xing Ye waiting off French Guiana, according to a new report by Lloyd’s List.

Newsweek has reached out to the U.S. State Department for comment.

#7 Taiwan

The Chinese just concluded military exercises that practiced what a full-blown blockade of Taiwan would look like.

At this stage, tensions between China and Taiwan are higher “than at any point in recent years”…

As 2025 ends, tensions between China and Taiwan are higher — and more overt — than at any point in recent years, fueled by expanded U.S. military support for Taipei, increasingly bold warnings from regional allies, and Chinese military drills that look less like symbolism and more like rehearsal.

Beijing has spent the year steadily increasing pressure on Taiwan through large-scale military exercises, air and naval incursions, and pointed political messaging, while Washington and its allies have responded with sharper deterrence signals that China now openly labels as interference.

#8 Pestilences

The bird flu continues to kill millions of birds all over the globe, various strains of mpox continue to circulate, and the pestilence that erupted in 2020 is still making people sick throughout the world.  Meanwhile, some U.S. states are seeing a historic spike in flu cases…

The ‘super flu’ is exploding across the US, with some states seeing more cases than ever before.

The latest CDC data for the week ending December 20 shows positive flu tests are up 53 percent compared to the week prior. Positive tests are up nearly 75 percent from this time last year.

During the week ending December 20, the number of people hospitalized surged 51 percent, and the number already in hospital has nearly doubled compared to the same period last year.

It is just a matter of time before the next great global pandemic arrives, and scientists are warning us that it could come from a multitude of potential directions…

Scientists continue to discover viruses with worrisome characteristics (Chen et al. 2025). Some experts worry about the potential for a leak from pathogen research labs (Palacios, Garcia-Sastre, and Relman 2025), or AI’s ability, in the wrong hands, to help with the creation of a bioweapon (Tjandra 2025). Out in the open, H5N1 avian influenza continues to spread and infect a wide range of animal species—the virus perhaps just a mutation away from becoming a human threat (Lin et al. 2024). Another pathogen, most likely an influenza or another coronavirus is waiting to break out.

#9 Seismic Activity Along The Pacific Ring Of Fire

Seismic activity along the Pacific Ring of Fire increased dramatically in 2025.

And as we enter 2026, the state of California is being shaken by significant earthquakes on an almost daily basis.

In fact, we just witnessed a magnitude 4.9 quake that really shook a lot of people up…

A magnitude 4.9 earthquake was recorded near the town of Susanville in Lassen County on Tuesday, according to the U.S. Geological Survey. The quake was centered around nine miles northwest of Susanville at 9:49 p.m. It was downgraded from an initial magnitude of 5.3.

#10 The Greatest Global Food Crisis In Modern History

We are in the midst of the greatest global food crisis in modern history.

But don’t just take my word for it.

The following comes from the official website of the UN’s World Food program…

Yes. Right now, there is a global food crisis – the largest one in modern history. Since the United Nations World Food Program’s (WFP) creation in 1963, never has hunger reached such devastating highs. From the eruption of new conflicts and the escalating impacts of the climate crisis to soaring food and fuel costs, millions of people are being driven closer to starvation each day.

Nearly 350 million people around the world are experiencing the most extreme forms of hunger right now. Of those, nearly 49 million people are on the brink of famine. Behind these massive statistics are individual children, women and men suffering from the dire effects of such severe hunger. Malnourished mothers give birth to malnourished babies, passing hunger from one generation to the next. Children’s physical and cognitive growth is stunted. Farmers are unable to grow enough food to provide for their families and communities. Entire towns are forced to leave their homes in search of food.

We really are living in apocalyptic times.

Sadly, many in the western world don’t seem to understand this since we don’t have war or famine on our own soil.

But for those that are watching carefully, it is exceedingly clear that we have arrived at a truly unique chapter in human history.

So many incredibly strange things are occurring all around us.

On New Year’s Eve, a green meteor dramatically flew past the most important landmark in the center of the United States…

A shimmering meteor was spotted cutting across the sky over the famed Gateway Arch in Missouri hours before revelers rushed to a New Year’s Eve celebration at the monument’s base.

“HEY LOOK, it’s… A meteor saying hi to the Gateway Arch on New Year’s Eve!” The St. Louis Gateway Arch’s X account wrote in a post shared with the breathtaking video.

In the six-second clip, a small white speck appears over one end of the arch. It grows into a green blaze that pulses once before disappearing back into the dark obscurity provided by the predawn sky — right as it reaches the arch’s peak.

The viral video was captured on an Earth Cam situated at Malcolm Martin Memorial Park in east St. Louis. The camera is angled directly towards the city’s skyline all day, every day.

That is something that you don’t see every day.

Of course so many weird things have been happening in the heavens over the last couple of years, and most of the population simply doesn’t care.

Most of us have an unbreakable addiction to entertainment at this point, and getting people to focus on anything other than entertainment is becoming exceedingly difficult.

Most people are just going to continue to stare at their screens as the world falls apart all around them, and that is extremely unfortunate.

Michael’s new book entitled “10 Prophetic Events That Are Coming Next” is available in paperback and for the Kindle on Amazon.com, and you can subscribe to his Substack newsletter at michaeltsnyder.substack.com.

Tyler Durden Fri, 01/02/2026 - 12:20

3 Key Supreme Court Cases To Watch In Early 2026

Authored by Sam Dorman and Stacy Robinson via The Epoch Times,

The Supreme Court will resume oral arguments the week of Jan. 12, taking on cases dealing with girls’ athletics, gun laws, and the president’s attempt to fire a member of the Federal Reserve.

Here are the top cases to watch.

1. Girls’ Sports

The Supreme Court on Jan. 13 will hear arguments in two cases—West Virginia v. B.P.J. and Little v. Hecox—that focus on West Virginia’s and Idaho’s laws barring males from competing in female sports. The eventual ruling is expected to tackle key questions about how federal law and the Constitution treat sex and gender.

Both states faced hurdles in federal appeals courts, which held that their laws classified individuals based on their sex and “transgender status.” They also indicated that those types of classifications violated the equal protection clause of the 14th Amendment, which generally directs states to apply the law equally to everyone regardless of particular characteristics.

While courts have sometimes allowed states to treat certain groups of people differently, legal classifications based on sex and other characteristics have also been rejected. That’s because when courts determine whether to uphold a state law, they weigh certain factors, such as whether the state has an important enough interest in using certain characteristics to classify individuals.

In both West Virginia’s and Idaho’s cases, the states have acknowledged that they classify people based on sex but that doing so is justified—specifically because they further important government interests in protecting equality in sports.

“On average, men are faster, stronger, bigger, more muscular, and have more explosive power than women,” Idaho told the Supreme Court. “For female athletes to compete safely and excel, they deserve sex-specific teams.”

West Virginia’s case has also led the Supreme Court to wrestle with a similar issue: whether athletics laws violate Title IX of the Civil Rights Act. That law, which prohibits sex-based discrimination in federally funded educational institutions, was cited by the U.S. Court of Appeals for the Fourth Circuit when it ruled against West Virginia in 2024.

That decision was wrong, West Virginia told the Supreme Court, because Title IX was focused on unequal treatment between the sexes rather than eliminating all sex-based distinctions.

U.S. House Majority Leader Steve Scalise (R-La.) speaks following the passage of the “The Protection of Women and Girls in Sports Act,” outside the U.S. Capitol on April 20, 2023. The Supreme Court on Jan. 13 will hear arguments in two cases that focus on West Virginia’s and Idaho’s laws barring males from competing in female sports. Saul Loeb/AFP via Getty Images

Heather Jackson, whose male child was barred from participating in girls’ cross country and track teams, argued that West Virginia’s law was unreasonable. Part of Jackson’s argument is that puberty-delaying drugs have prevented her child from developing physiological, athletic advantages over girls.

Meanwhile, the student challenging Idaho’s law has attempted to withdraw from the dispute while pledging not to participate in women’s sports. The Supreme Court has deferred deciding on this attempt until after oral argument.

Beyond sex-based distinctions, the appeals courts raised a separate question about whether Idaho’s and West Virginia’s laws classify individuals based on “transgender status.” In other words, do the states target individuals based on that purported status rather than solely based on their sex?

So far, the Supreme Court hasn’t offered a definitive ruling on this issue, but multiple justices suggested in June that someone’s “transgender status” shouldn’t receive extra protection under the Constitution. Justices Samuel Alito and Amy Coney Barrett both said, among other things, that “transgender status” lacked the type of immutable characteristic held by other protected classes, such as race.

2. Hawaii’s Gun Law

The Supreme Court will hear arguments on Jan. 20 in Wolford v. Lopez, which challenges Hawaii’s restrictions on concealed carry but also invites the court to clarify the role of American history in upholding gun laws.

In a landmark ruling in 2022, Justice Clarence Thomas said that state laws should be consistent with the nation’s historical tradition of firearm regulation.

Since then, lower courts have tried applying the decision in that case, known as New York State Rifle and Pistol Association v. Bruen, to state laws such as Hawaii’s. The Hawaii law prohibited concealed-carry permit holders from carrying weapons in privately owned public spaces unless given “express authorization of the owner, lessee, operator, or manager of the private property.”

When the Ninth Circuit reviewed the law, it said those restrictions fell “well within the historical tradition.” The appeals court pointed to a New Jersey law from 1771 and a Louisiana law from 1865 that it said were “dead ringers” for Hawaii’s restrictions.

A man carries a gun before a hearing where four gun control bills passed the Senate Judiciary Committee at the Virginia state Capitol in Richmond, Va., on Jan. 13, 2020. The Supreme Court will hear arguments on Jan. 20 in a case challenging Hawaii’s concealed-carry restrictions that also asks the justices to clarify how history should factor into gun laws. Samira Bouaou/The Epoch Times

Those two were relevant because one was enacted just before the Second Amendment’s ratification, while the other came just before ratification of the 14th Amendment, which extends the Second Amendment to states.

Jason Wolford, a Hawaii resident who sued with other plaintiffs, is asking the Supreme Court to reverse the Ninth Circuit’s decision on the basis that it erred in analyzing the older laws. More specifically, his attorneys argued that historic laws couldn’t merely be similar to the one passed by Hawaii.

Instead, the Supreme Court’s decision in Bruen required that the laws needed to serve similar purposes, the petition says.

Louisiana’s law was too different from Hawaii’s, Wolford said, because it not only focused on land that was barred to the public but also came as part of the state’s “black codes” intended to deprive former slaves of civil rights. He also argued that the New Jersey law was intended to control poaching on enclosed lands and was therefore different from Hawaii’s law.

Hawaii, meanwhile, described its law as following numerous founding-era and Reconstruction-era laws in vindicating the rights of property owners to exclude certain people from their property.

3. Trump’s Fed Firing

On Jan. 21, the Supreme Court will examine the president’s authority to remove members of the Federal Reserve. The case, Trump v. Cook, follows another case heard in December over the president’s ability to fire a member of the Federal Trade Commission.

Both cases focus on laws Congress passed restricting the president’s ability to fire officials. Trump v. Cook is a bit different, however, in that it focuses more on the purported cause Trump cited in firing Federal Reserve Board of Governors member Lisa Cook.

Lisa Cook, member of the Board of Governors of the U.S. Federal Reserve, departs the Federal Reserve Board headquarters in Washington on Oct. 9, 2025. On Jan. 21, the Supreme Court will examine the president’s authority to remove members of the Federal Reserve. Andrew Caballero-Reynolds/AFP via Getty Images

The issue arose after Trump sent a letter in August accusing Cook of mortgage fraud.

Cook and Trump have differed over whether alleged fraud was the type of “cause” that Congress allowed the president to use as a basis for firing board members. While the Federal Reserve Act allows presidents to fire members “for cause,” it doesn’t offer much indication as to what that means. Trump, meanwhile, has argued that courts shouldn’t be able to second-guess his determination that a sufficient cause existed for firing someone such as Cook.

Many of the arguments surround how much protection Cook deserves under the Fifth Amendment, which says people can’t “be deprived of life, liberty, or property, without due process of law.”

A federal judge in Washington reinstated Cook on the basis that she had a property interest in her position but wasn’t given due process before losing her job. That due process, the judge said, should include some kind of meaningful notice and an opportunity to be heard.

Trump appealed to the Supreme Court, telling the justices that tenure-protected officers didn’t have a property right to their positions and that reinstatement was outside of judges’ authority.

Tyler Durden Fri, 01/02/2026 - 11:40

Fighting Breaks Out On Saudi Border In Oil-Rich Yemen Region

Yemen continues to be a major headache and security risk for the Saudis, and rare fighting has emerged just on the kingdom's border. Looming over the crisis is the deepening rift between Gulf Cooperation Council (GCC) members Saudi Arabia and the United Arab Emirates.

Saudi warplanes carried out fresh airstrikes on sites near the Saudi-Yemeni border in Yemen's Hadramout province on Friday, as clashes erupted between forces loyal to the Saudi-backed provincial governor and fighters affiliated with the separatist Southern Transitional Council (STC).

UAE-backed southern Yemeni separatist forces, via Reuters.

The STC has for years called the secession of a proposed federal "State of South Arabia" from the rest of the country, and is backed in this current conflict by the UAE.

At lease seven air raids along the border occurred Friday, according to local officials. The STC's leader in Wadi Hadramout, Mohammed Abdulmalik, has said that the strikes killed seven people and injured more than 20 others.

Saudi-backed authorities have this week moved to reassert control over military installations in the province. Hadramout borders Saudi Arabia and thus whichever group controls the area gains great influence and strategic importance, also given it is an area rich with crude.

Earlier on Friday, Yemen's Saudi-backed government formally announced the launch of a military operation targeting the STC in Hadramout. Speaking in a televised address from Riyadh, the province's governor said the campaign was intended to reassert state authority and secure key institutions in the oil-producing region.

In response, STC forces said they were fully prepared to confront any military escalation following the governor's announcement.

Al Jazeera's Ali Hashem has explained of the geopolitical pressures which led to the new escalation:

The opportunity here for the Southern Transitional Council (STC) is to go towards separation, to have a southern state, which has been its dream for decades.

It’s a different moment and it’s instrumental in recalibrating the region. Israel’s war on Gaza war has changed everything – it changed the perception of national security within major states in the region. It changed also the way small players are regarding the possibilities and potential they can build on.

The UAE-backed STC has long rivaled Yemen’s internationally recognized government for influence in the south. However, both sides have at times coordinated against the Iran-aligned Houthi movement in an "enemy of my enemy is my friend" kind of way.

Map source: American Foreign Service Association

While media cameras have for years focused on the dominant Houthis in Yemen, friction between Saudi-supported and Emirati-aligned forces has increasingly flared into armed confrontations.

Tyler Durden Fri, 01/02/2026 - 11:20

Today, in the Calculated Risk Real Estate Newsletter: Inflation Adjusted House Prices 2.7% Below 2022 Peak

Excerpt:

It has almost 20 years since the housing bubble peak, ancient history for many readers!

In the October Case-Shiller house price index released Tuesday, the seasonally adjusted National Index (SA), was reported as being 78% above the bubble peak. However, in real terms, the National index (SA) is about 9.7% above the bubble peak (and historically there has been an upward slope to real house prices). The composite 20, in real terms, is 1.1% above the bubble peak.
...
People usually graph nominal house prices, but it is also important to look at prices in real terms. As an example, if a house price was $300,000 in January 2010, the price would be $448,000 today adjusted for inflation (49% increase). That is why the second graph below is important - this shows "real" prices.br />
The third graph shows the price-to-rent ratio, and the fourth graph is the affordability index. The last graph shows the 5-year real return based on the Case-Shiller National Index.
...
The second graph shows the same two indexes in real terms (adjusted for inflation using CPI).

In real terms (using CPI), the National index is 2.7% below the recent peak, and the Composite 20 index is 3.0% below the recent peak in 2022.

Both the real National index and the Comp-20 index increased in October. This was the first increase in the real National index has in 10 months.

It has now been 41 months since the real peak in house prices. Typically, after a sharp increase in prices, it takes a number of years for real prices to reach new highs (see House Prices: 7 Years in Purgatory)

There is much more in the article!

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RFK Jr. Stops Requiring Doctors To Report Patient Vaccine Status

Authored by Zachary Stieber via The Epoch Times,

Health Secretary Robert F. Kennedy Jr. has stopped mandating health care providers report the immunization status of patients.

Kennedy decided to stop requiring doctors to list vaccinations children have received, the Centers for Medicare & Medicaid Services (CMS) said in a Dec. 30, 2025, letter to state health officials.

Doctors participating in Medicaid and the Children’s Health Insurance Program were previously required to report how many children received specific vaccines by their second birthday, and other shots by the time they turn 14 years old.

Kennedy also eliminated a requirement that doctors report the immunization status of pregnant women, according to the notice.

“Government bureaucracies should never coerce doctors or families into accepting vaccines or penalize physicians for respecting patient choice. That practice ends now,” Kennedy, head of the Department of Health and Human Services (HHS), of which CMS is a part, said in a post on X. “Under the Trump administration, HHS will protect informed consent, respect religious liberty, and uphold medical freedom.”

Federal law requires that doctors report certain measures while caring for the approximately 78 million people on Medicaid or the Children’s Health Insurance Program, and that states convey that data to CMS. The reporting was voluntary when first implemented. It began being mandated in fiscal year 2024.

CMS did not respond to a request for comment. In the letter, the agency noted that Kennedy has authority under the law to make changes to the required measures “to improve and strengthen” the reporting requirements, and that pursuant to that authority, CMS was removing the immunization reporting requirements.

The agency said that providers can choose to voluntarily provide the information moving forward “to allow CMS to maintain a longitudinal dataset while exploring alternative immunization measures.”

It also said that starting in 2026, officials would be exploring the development of new measures that would “capture information about whether parents and families were informed about vaccine choices, vaccine safety and side effects, and alternative vaccine schedules.”

Officials plan to talk with states, providers, and other stakeholders about those measures.

“CMS will also explore how religious exemptions for vaccinations can be accounted for in the data and the subsequent measures,” the letter states.

“CMS does not tie payment to performance on immunization quality measures in Medicaid and CHIP at the federal level. While states have flexibility and discretion to use quality measures in state developed value-based purchasing and payment incentive fee for service or managed care programs, CMS strongly discourages states from using immunization measures in payment arrangements.”

Tyler Durden Fri, 01/02/2026 - 11:00

The post Trump Says Fraud is a Big Problem When Black People Do It: The MN Daycare Fraud Story appeared first on CEPR.

 

 

Earlier this week, I mentioned how some media outlets completely biffed the end of the Howard Stern Show on Siruis XM radio. For too many reasons, they insisted the show was coming to an end. Instead, Sirius renewed Stern’s contract for another three years.

That post led a buddy who is an industry veteran (Fox, Bloomberg, NBC) to share a widely overlooked aspect of The Stern Show: How innovative the technology it developed was.

Many things we take for granted today were created for various incarnations of his E! show:

“A lack of appreciation — a Moore’s Law byproduct, I suppose — that anyone has for how difficult it once was to film three headphone-wearing idiots sitting around EV microphones.

When MSNBC launched Imus in the Morning on TV, it was a feat of broadcast engineering spearheaded by a team of savvy technicians at NBC. People fail to appreciate just how difficult it was back then to account for all the technical limitations of broadcasting live on two different linear platforms for several hours every day.

Some of those same engineers designed the studio for Imus on Fox Business, and it was ahead of its time (Circa 2008)…it wasn’t Apollo 13, but it was certainly innovative.

When Stern did the deal with E! for the late-night cable TV replay, it was a game-changer and probably one of the first tangible examples of Video on Demand profitability from a daily/live program. It’s so easy these days to set up two iPhones, stream it into the cloud, then pull down the footage to edit and push to YouTube — but find me the one influencer/online content guru who recognizes just how much Stern (and Imus) paved the way for them to not have a real job?

I suppose in music, a guitarist of today’s vintage would recognize the contribution of past eras….Hendrix, Clapton, Beck, etc., but with the proliferation of online content, everyone living high off digital ads and millions of views seems to have forgotten who made it all possible…”

It is very easy to take things for granted and not realize where all the wonderful, enabling technology we use originated. The early days in every field were filled with clever people working with limited budgets and cobbled-together-tools to do and create things that had never been done before…

 

 

 

Previously:
Nobody Knows Anything, Howard Stern Edition (December 30, 2025)

 

 

The post Surprising Innovation: The Technology of Live Radio appeared first on The Big Picture.

NPR's CEO Refused Internal Demands To Resign "For The Good Of Public Media" Before Loss Of Funding

Authored by Jonathan Turley,

The New York Times reports that the Corporation for Public Broadcasting (CPB) called on National Public Radio (NPR) CEO Katherine Maher to resign before all federal funding for both the CPB and NPR was cut off. As in the past, Maher and the NPR board chose their own agendas over the interests of their institution and public radio.

I have long been a critic of Maher since her inexplicable selection by the NPR board to lead the media organization. Despite years of objections to NPR’s overt bias, many critics genuinely wanted NPR to reverse course and adopt more balanced coverage. That is why, when NPR was searching for a new CEO, I encouraged the board to hire a moderate figure without a history of political advocacy or controversy.

Instead, the board selected Katherine Maher, a former Wikipedia CEO widely criticized for her highly partisan and controversial public statements.

She was the personification of advocacy journalism, even declaring that the First Amendment is the “number one challenge” that makes it “tricky” to censor or “modify” content as she would like.

Maher has supported “deplatforming” anyone she deems to be “fascists” and even suggested that she might support “punching Nazis.”

She also declared that “our reverence for the truth might be a distraction [in] getting things done.”

As expected, the bias at NPR only got worse. The leadership even changed a longstanding rule barring journalists from joining political protests.

One editor had had enough. Uri Berliner had watched NPR become an echo chamber for the far left with a virtual purging of all conservatives and Republicans from the newsroom. Berliner noted that NPR’s Washington headquarters has 87 registered Democrats among its editors and zero Republicans.

Maher and NPR remained dismissive of such complaints. Maher attacked the award-winning Berliner for causing an “affront to the individual journalists who work incredibly hard.”  She called his criticism “profoundly disrespectful, hurtful, and demeaning.”

Berliner resigned, after noting how Maher’s “divisive views confirm the very problems at NPR” that he had been pointing out.

In her disastrous appearance before Congress, Maher sat next to PBS CEO Paula A. Kerger and dismissed criticism. What was not disclosed is that PBS agreed with some of us that, if Maher truly wanted to save federal funding and protect NPR, she would resign.

According to the Times, our calls for her resignation were being repeated internally. Instead, the board that made the foolish choice of hiring Maher chose their ideological and personal agendas over the interests of their institution . . . again.

In the meantime, Maher and others were going public, bewailing the threat to journalism and calling on citizens to do everything that they could to protect NPR. The only thing that they were not willing to do was admit their own failure.

We have seen the same pattern in academia.

The fact is that this academic echo chamber may be killing educational institutions, but the intolerance still works to the advantage of faculty who can control publications, speaking opportunities, and advancement with like-minded ideologues.

We have watched the same perverse incentive in the media where outlets are seeing plummeting readers and revenue. Journalism schools and editors now maintain that reporters should reject objectivity and neutrality as touchstones of journalism.

It does not matter that this advocacy journalism is killing the profession. Reporters and editors continue to saw at the limb upon which they sit due to the same advantage for academics. For reporters, converting newsrooms into echo chambers gives them more security, advancement, and opportunities.

Recently, the new Washington Post publisher and CEO William Lewis was brought into the paper to right the ship. He told the staff “let’s not sugarcoat it…We are losing large amounts of money. Your audience has halved in recent years. People are not reading your stuff. Right. I can’t sugarcoat it anymore.”

The response from reporters was to call for owner Jeff Bezos to fire Lewis and others seeking to change the culture. The Post has been eliminating positions and just implemented another round of layoffs to address the budget shortfalls.

In the meantime, trust in the media is at record lows — paralleling the polling on higher education. The result is the rise of new media as people turn to blogs and other sources for their news.

At NPR, the board and Maher have led the organization into a complete and utter meltdown, resulting in the loss of millions in funding and a shrinking audience. However, it does not matter. CPB called on Maher to resign “for the good of public media.” It was not, however, good for her or her board.

Socially and personally, these individuals are praised and promoted as ideological champions on the left. They were even willing to see the death of CPB to remain faithful to the agenda.

So, CPB died, NPR lost all funding, but Maher kept her job… and her agenda.

Tyler Durden Fri, 01/02/2026 - 10:20

"Then It Is War": Elon Musk Responds After Somali TikToker Threatens His Life

A Somali TikToker (account now defunct), first highlighted by Libs of TikTok, mocked Americans about alleged Somali-linked fraud in Minnesota and pushed dangerous rhetoric suggesting Elon Musk was "about to die." Such statements fit a broader alarming pattern surrounding the Democratic Party's normalization of assassination culture against Musk and President Trump supporters.

"I wouldn't worry too much about him. He [Musk] about to die," TikToker "dowza.z" stated in a short 30-second clip. The account has since been taken down, and it remains unclear whether the TikToker deleted the account or whether the dangerous rhetoric directed at Musk violated the platform's terms of service.

The somali tiktoker who mocked Americans had a meltdown over Elon Musk and appeared to threaten his life:

“I wouldn’t worry too much about him. He about to die.”

. @FBI should definitely look into this https://t.co/37Ok26xstv pic.twitter.com/Ow8NmwFhut

— Libs of TikTok (@libsoftiktok) January 1, 2026

Musk responded on X to DogeDesigner's reposting of the video, saying, "Then it is war."

Then it is war https://t.co/KdlKDW6f61

— Elon Musk (@elonmusk) January 2, 2026

Musk's comment comes as the current political climate, characterized by increasingly hostile rhetoric from the Democratic Party, has significantly amplified threats and the spillover of inflammatory left-wing propaganda into real-world security risks. Historical precedent supports this assessment, including the role of dark-money-funded NGOs backing anti-American activist networks, what Peter Schweizer has described as the "protest industrial complex," which coordinated protest activity and other pressure campaigns targeting Musk, Tesla, President Trump, and anything 'America First'. These efforts coincided with radical left groups, including firebombing terror incidents at Tesla showrooms. Taken together, this pattern of threats from the left and their supporters has translated into real-world consequences. Just look at what happened to Charlie Kirk, which reinforces the urgency for Musk to ramp up his political activity this year.

"America is toast if the radical left wins. They will open the floodgates to illegal immigration and fraud. Won't be America anymore," Musk wrote on X.

Musk was quoting a report that he is reportedly going all-in on funding Republicans for the midterm election cycle.

America is toast if the radical left wins.

They will open the floodgates to illegal immigration and fraud.

Won’t be America anymore. https://t.co/9lppGuSyAV

— Elon Musk (@elonmusk) January 1, 2026

This is just day two of the new year.

Tyler Durden Fri, 01/02/2026 - 10:00

US Manfacturing Survey Signals "Wile E Coyote" Scenario

With 'hard' data showing resilience into year-end, 'soft' survey data has cratered (not helped by the government shutdown)...

Source: Bloomberg

...and this morning brings more weakness as S&P Global's US Manufacturing PMI (final print for December) dipped to 51.8 - its lowest since July (the only contractionary - sub-50- month of 2025)...

Source: Bloomberg

The latest survey showed a weaker gain in production, amid a renewed contraction in new order books – the first in exactly a year. International sales continued to fall, in part linked to tariffs, which also continued to push up operating expenses at an elevated pace. That said, although remaining historically elevated, both input and output prices rose at their slowest rates for 11 months.

 

“Although manufacturers continued to ramp up production in December, suggesting the goods producing sector will have contributed to further robust economic growth in the fourth quarter, prospects for the start of 2026 are looking less rosy," according to Chris Williamson, Chief Business Economist at S&P Global Market Intelligence.

“Something of a Wiley E Coyote scenario has developed, whereby – just like the cartoon character continues to run despite chasing the roadrunner off a cliff– factories are continuing to produce goods despite suffering a drop in orders."

The gap between growth of production and the drop in orders is in fact the widest seen since the height of the global financial crisis back in 2008-9:

"Unless demand improves, current factory production levels are clearly unsustainable."

Payroll numbers will also be adversely impacted if production capacity has to be scaled back.

“A key factor causing concern over sales is the extent to which producers are having to pass higher costs on to customers in the form of raised prices, with higher costs continuing to be overwhelmingly blamed on tariffs," says Williamson.

There is some good news:

“Some encouragement comes from input cost inflation moderating in December to the lowest recorded since last January.

But...

However, while this cost trend suggests the tariff impact on inflation peaked back in the summer, costs are still rising month-on-month at an elevated rate to suggest that US firms continue to face higher cost growth than competitors in most other major economies.”

So, choose your own adventure: Hard or Soft data?

Tyler Durden Fri, 01/02/2026 - 09:54

Tesla Q4 Deliveries Fall 16% As Investors Pivot Toward Robotaxi, Optimus

Tesla delivered 418,227 vehicles in Q4 2025, below Wall Street’s expectation of roughly 426,000 deliveries, according to CNBC and the company. Production totaled 434,358 vehicles. For the full year, Tesla delivered 1.64 million vehicles in 2025, down 9% from 2024 and marking the second consecutive annual decline in deliveries.

Shares are now down about 10% from recent highs, despite the stock holding relatively firm given the disappointing numbers so far today.

On December 29, the company publicly released its own analyst delivery consensus for the quarter via a press release on its investor relations website — a significant departure from its normal practice. Tesla typically compiles these estimates but only shares them privately with a select group of analysts and major investors.

The decision to publish the consensus suggested the automaker was trying to manage expectations ahead of what it appeared to anticipate would be a disappointing report.

That internal survey of 20 analysts projected 422,850 deliveries for the quarter, far below the broader public consensus at the time, which ranged from roughly 440,000 to 450,000 vehicles. Even Tesla’s lowered benchmark proved too high.

Fourth-quarter deliveries declined 16% from a year earlier, when Tesla delivered 495,570 vehicles. Production fell 5.5% from the 459,445 vehicles the company built in the same period last year.

EV blog electrek wrote in response to the numbers:

"This is pretty much exactly what we expected: a 15% drop year-over-year and a quarter-over-quarter as Tesla loses incentives in the US and its decline in Europe and China continues. Tesla did report of 14.2 GWh of energy storage deployment, a new record. It’s a silverlining, but it won’t be enough to compensate for the significant drop in electric vehicle deliveries.

Tesla will end 2025 with a second consecutive year of decline in revenue and earnings despite being a “leader” in the globally booming EV market. There’s room for concern: unless you 100% believe in Musk’s pivot to AI. Then, you have nothing to worry about."

The company’s deliveries peaked at 1.81 million vehicles in 2023 before its growth began to stall amid intensifying global competition and an aging vehicle lineup.

Tesla’s fourth-quarter breakdown showed 406,585 Model 3 and Model Y vehicles delivered, along with 11,642 deliveries from its other models, for a total of 418,227.

The pressure on Tesla’s core auto business has become especially visible in Europe. While the company does not provide geographic delivery data, figures from the European Automobile Manufacturers’ Association show Tesla’s registrations in the region fell 39% in the first 11 months of 2025, even as overall battery-electric vehicle adoption increased. During the same period, Chinese rival BYD’s European registrations surged 240%.

Tesla now faces fierce competition from a growing list of global automakers, including BYD, Xiaomi and Geely in China, Hyundai and Kia in South Korea, and Volkswagen in Europe. At the same time, political controversies surrounding CEO Elon Musk have contributed to consumer backlash in both Europe and the United States, further weighing on the brand.

The company’s energy business offered a bright spot. Tesla said it deployed 14.2 gigawatt-hours of battery energy storage products in the fourth quarter, up from a record 12.5 GWh in the prior period. The division supplies large-scale systems to utilities and data centers as well as backup batteries for homes.

Some analysts believe Tesla’s newly introduced lower-priced Model Y standard, launched in October, could help stabilize sales in coming quarters, particularly in emerging markets such as Brazil, Thailand and Vietnam. Still, Tesla enters 2026 facing its most uncertain growth outlook in more than a decade, as investors increasingly weigh Elon Musk’s ambitious long-term vision for robotaxis and humanoid robots against the near-term realities of slowing vehicle demand.

Tesla is scheduled to report its full fourth-quarter financial results on Jan. 28.

Tyler Durden Fri, 01/02/2026 - 09:45

Could Electricity Prices Become A Structural Inflation Problem

Via RealInvestmentAdvice.com,

Most Americans are paying higher electricity prices, and the pressure is unlikely to ease anytime soon.

According to the Wall Street Journal, electricity prices have risen meaningfully across much of the country since 2022, and the drivers extend well beyond the frequently cited surge in data-center demand.

While electricity prices had historically tracked inflation, that relationship broke down after Russia’s invasion of Ukraine sent natural gas prices sharply higher.

Since then, utilities have faced rising fuel costs, storm damage from hurricanes and wildfires, and the need to replace aging grid infrastructure.

State-level renewable energy mandates have also driven up costs in regions where wind and solar resources are less efficient, particularly in the Northeast and Mid-Atlantic.

Looking ahead, the pressure is set to intensify.

The Energy Department expects average residential electricity prices to rise another 4% in 2026, following a nearly 5% increase this year. Investor-owned utilities are projected to spend roughly $1.1 trillion between 2025 and 2029 on transmission, distribution, and generation. That’s double what they spent in the prior decade, and those costs are typically passed through to customers over time.

For consumers, electricity is already the second-largest energy expense after gasoline.

For investors, persistently rising power costs risk becoming a more durable source of inflation than policymakers anticipate.

Even if headline inflation cools, higher utility bills could continue to pressure household budgets, complicate the Fed’s disinflation narrative, and weigh on consumer-driven growth.

Tyler Durden Fri, 01/02/2026 - 09:35

Magnitude 6.3 Earthquake Strikes Near Mexico City

A powerful magnitude 6.3 earthquake was just detected 13 miles northwest of Ayutla de los Libres, Mexico, or about 220 miles from Mexico City.

"Not sure what the damage is yet, but a pretty big earthquake just hit Acapulco. My building shook for a good 10 seconds here in Mexico City, about 190 miles away," one X user said.

Not sure what the damage is yet, but a pretty big earthquake just hit Acapulco.

My building shook for a good 10 seconds here in Mexico City, about 190 miles away. pic.twitter.com/l9GQAAOCrx

— BowTiedPassport (@BowTiedPassport) January 2, 2026

Footage:

❗️ 6.5 Earthquake in Guerrero, Mexico causes entire building to SWAY

HUNDREDS evacuated from apartment buildings — ITVNews https://t.co/Ga3J8WVqJ3 pic.twitter.com/Yh3KNpTDXW

— RT (@RT_com) January 2, 2026

VIDEO: Moment earthquake hits Mexico https://t.co/jlK0zh27za pic.twitter.com/rHctOn79Jr

— Breaking911 (@Breaking911) January 2, 2026

Mexico

Earthquake

Mexico city
Temnlor#earthquake #mexicoxity pic.twitter.com/2TSj1Fy9Gi

— Shikha Panchhi (@ShikhaPanchhi) January 2, 2026

Strong earthquake shakes Mexico- 6.5 in San Marcos, Guerrero - video from center of Mexico City pic.twitter.com/fuHIIAWQqK

— Andalalucha (@Andalalucha) January 2, 2026

A happy new year earthquake in Mexico City.

Just got woken up by the earthquake alarm and a short sharp skake… pic.twitter.com/JeKmy5hVwj

— Ioan Grillo (@ioangrillo) January 2, 2026

Mexican President Sheinbaum's presser was disrupted. 

WATCH: Moment earthquake triggers alarm during Mexican President Sheinbaum’s conference, reporters rushed out pic.twitter.com/3CNd8jweTW

— Rapid Report (@RapidReport2025) January 2, 2026

*Developing…

Tyler Durden Fri, 01/02/2026 - 09:21

SBA Suspends 7,000 Minnesota Borrowers Over "Suspected Fraudulent Activity"

Small Business Administration Administrator Kelly Loeffler announced late Thursday that nearly 7,000 Minnesota borrowers have been suspended over suspected fraud. The move follows a bombshell report last week by citizen journalist Nick Shirley, who detailed alleged large-scale fraud tied to daycare centers operated by Somali-linked networks. The revelations sparked national outrage, with many Americans angered that their taxes are funding what appears to be industrial-scale migrant welfare fraud.

"Over the last week, SBA has reviewed thousands of potentially fraudulent pandemic-era PPP and EIDL loans approved in Minnesota," Loeffler said Thursday on X.

She continued:

Today, our agency took action to suspend 6,900 Minnesota borrowers amid suspected fraudulent activity. In total, these borrowers were approved for 7,900 PPP and EIDL loans worth approximately $400M. These individuals will be banned from all SBA loan programs, including disaster loans, going forward.

We will also refer every case, where appropriate, to federal law enforcement for prosecution and repayment.

After years, the American people will finally begin to see the criminals who stole from law-abiding taxpayers held accountable, and this is just the first state.

Over the last week, SBA has reviewed thousands of potentially fraudulent pandemic-era PPP and EIDL loans approved in Minnesota.

Today, our agency took action to suspend 6,900 Minnesota borrowers amid suspected fraudulent activity. In total, these borrowers were approved for…

— Kelly Loeffler (@SBA_Kelly) January 2, 2026

Early in December, Loeffler announced a full investigation into "the network of Somali organizations and executives" implicated in Covid-era fraud schemes in the corrupt Democratic-run state.

Tim Walz's state has been in the spotlight over allegations of industrial-scale fraud, with US Attorney Joe Thompson recently warning that the total could top $9 billion across 14 Medicaid programs.

The scandal began at nonprofit Feeding Our Future, based in Minnesota, which was accused of stealing from the Federal Child Nutrition Program by falsely claiming to distribute meals during the Covid pandemic.

A Christopher F. Rufo report alleged that some of the welfare fraud was funneled into an overseas terrorist organization...

Shirley's bombshell report of what appeared to be "empty" day care and autism centers run by Somali operators only suggests possible front companies to maximize extraction from taxpayer programs while minimizing detection.

In response, as we coined "The Shirley Effect," citizen journalists have flooded Democratic-run states and cities to search for fraud, and what they have found in just one week is deeply alarming (read here).

The Somali "daycare manager" appears to be wearing $2,500 glasses. https://t.co/MeIx3wDQPu pic.twitter.com/1nFylQJNkL

— Nathan Hansen (@nathanmhansen) December 31, 2025

By late week, the Department of Health and Human Services announced that it had frozen federal child care payments nationwide, citing mounting reports of suspected fraud.

"MN mom" panics after seeing "fraud is bad" in her script pic.twitter.com/EaV2Ptjssh

— End Wokeness (@EndWokeness) December 31, 2025

The nation has been shocked this week, not just because corporate media tried to downplay and discredit Shirley's report, which led to CBS panicking by late week, but also because average folks, swamped by taxes, overregulation, and elevated costs of living, all leftovers from disastrous "Bidenomics," now see their tax dollars funding the lives of migrants milking the welfare system in what could be one of the largest welfare schemes in years.

Americans are reaching a breaking point.

Fraud fatigue is now a very real thing.

People are not only questioning the system, but are completely done with the system and considering not even paying taxes.

Why should we? It only gets sent to Somali Pirates, and fraudsters and… pic.twitter.com/9kAumrr7Cx

— AmericanPapaBear™ (@AmericaPapaBear) December 31, 2025

Americans are reaching a breaking point. Fraud fatigue is real. 

Tyler Durden Fri, 01/02/2026 - 09:15

Ørsted Sues Trump Administration Over Project Suspension

Authored by Tsvetana Paraskova via OilPrice.com,

A joint venture of Ørsted, the world’s largest offshore wind developer, has challenged in court the Trump Administration’s lease suspension order to halt work on the Revolution Wind offshore wind project off the U.S. East Coast. 

Revolution Wind LLC, a 50/50 joint venture between Global Infrastructure Partners’ Skyborn Renewables and Ørsted, filed a supplemental complaint in the U.S. District Court for the District of Columbia, challenging the lease suspension order issued on December 22, 2025 by the U.S. Department of the Interior’s Bureau of Ocean Energy Management (BOEM), to be followed by a motion for a preliminary injunction. 

On December 22, the U.S. Department of the Interior paused leases for five offshore wind projects, due to national security concerns, said Secretary of the Interior, Doug Burgum. 

The projects Vineyard Wind 1, Revolution Wind, CVOW – Commercial, Sunrise Wind, and Empire Wind 1 were paused by the U.S. Administration, which threw another curveball to developers of offshore wind projects, many of which are in advanced stage of development. 

Revolution Wind, which secured all required federal and state permits in 2023, following extensive reviews, is currently about 87% complete and has already installed all offshore foundations and 58 of 65 wind turbines. 

Sunrise Wind LLC, a separate project and wholly-owned subsidiary of Ørsted that also received a lease suspension order on December 22, continues to evaluate all options to resolve the matter, including engagement with relevant agencies and stakeholders and considering legal proceedings, the Denmark-based offshore wind giant said on Friday.

Last week, Norway’s Equinor suspended work on the Empire Wind 1 project following the stop-work order issued by the U.S. Administration. 

The Trump Administration has made no secret of its attitude to wind energy, and especially offshore wind. Since President Trump took office, the federal government has clamped down on wind energy projects through stop-work orders and subsidy removals.      

Tyler Durden Fri, 01/02/2026 - 08:55

Futures Blast Off On First Day Of 2026 With Europe, Asia At Records

Stocks are set to break a four-day losing streak as markets start the new year with a bang across global markets, boosted by the same drivers that dominated much of 2025.As of 8:00am ET, S&P 500 futures were 0.6% higher with Nasdaq 100 contracts rallying 1% outperforming on renewed optimism around artificial intelligence.Nvidia rose 1.6% in premarket trading to lead gains among the Magnificent Seven, which were all green in premarket trading. Trading is likely to remain much lighter than usual, with many market participants not returning to their desks until Monday. As BBG notes, the setup has a familiar feel: Europe is green across the board and on course for a record high, while Asian stocks already hit a record, driven by gains in AI and chipmakers. The Bloomberg Dollar Spot Index is up 0.1% while the Aussie dollar is the best G-10 performer, rising 0.3% against the greenback; the euro underperforms and falls 0.3%. Treasuries inch higher, pushing US 10-year yields down 1bp to 4.15%. European yield curves bear steepen. Silver and gold are resuming their march higher, and copper is extending gains as miners in Chile go on strike. Aluminum touched $3,000 a ton for the first time in more than three years on expectations of tighter supply. And the dollar, following its worst year in eight, remains lackluster. US economic calendar includes December final S&P Global US manufacturing PMI at 9:45am. No Fed speakers are scheduled.

In premarket trading,  Mag 7 stocks are all higher (Nvidia +1.6%, Tesla +1.3%, Alphabet +1.1%, Amazon +0.9%, Meta +0.6%, Apple +0.5%, Microsoft +0.4%)

• Shares in RH (RH) gain 4.4% and Wayfair (W) advances 2.4% after President Donald Trump delayed tariff increases on upholstered furniture, kitchen cabinets and vanities.
• ASML ADRs (ASML) gain 4.8% as Aletheia Capital double upgrades the chip equipment maker’s European shares to buy from sell due to investment expansions and capacity upgrades.
• Baidu ADRs (BIDU) jump 11% after the company submitted a proposal to Hong Kong’s exchange to list its artificial-intelligence chip unit Kunlunxin.
• NIO Inc. US-listed shares (NIO) rise 4.7% after the EV-maker reported deliveries for December that showed 33% growth month-over-month.
• Outlook Therapeutics (OTLK) falls 60% after the FDA issued a complete response letter to the ONS-5010/LYTENAVA (bevacizumab-vikg) biologics license application resubmission, indicating that it cannot approve the application in its present form for the treatment of wet age-related macular degeneration.
• Sable Offshore (SOC) jumps 19% after the company gets a go-ahead to restart a controversial California pipeline.
• Vertiv Holdings (VRT) gains 4.3% as Barclays upgrades the power equipment company to overweight from equal-weight, saying its shares currently offer a good entry point following recent volatility.
• China’s BYD met full-year sales targets and likely surpassed Tesla to become the world’s largest electric-vehicle maker in 2025. Its shares rallied 3.6% in Hong Kong. 

In other corporate news, First Brands founder Patrick James said he’d likely plead his Fifth Amendment right against self-incrimination if compelled to answer questions from Jefferies at an upcoming deposition, citing a federal criminal investigation into the bankrupt auto parts supplier.

Friday’s upbeat mood is defying historic trends after the S&P 500 recorded declines on the first trading days of the previous three years. Since 1953, the S&P 500’s median change to kick off a new year has been a 0.3% drop, with gains less than half the time, according to a note by Bespoke Investment Group.

A strong debut in Hong Kong for chip designer Shanghai Biren Technology helped to set the buoyant tone early in the day. Baidu rallied after its AI chip unit confidentially filed for an IPO. Meanwhile, DeepSeek published a paper outlining a more efficient approach to developing AI. Tech and AI were among the dominant themes for stock investors in 2025, helping power the S&P 500 to a third year of double-digit gains. Forecasts signal more of the same for 2026 despite lingering wariness over already stretched valuations and fears that vast amounts of capital expenditure could fail to pay off.

“What we are seeing today is a continuation of the run higher in equities, with AI and tech again at the forefront,” said Tim Waterer, chief market analyst at KCM Trade. “Traders are still in a buying mood, with many of the bullish themes from 2025 carrying forward into 2026.”

At Barclays, strategists are warning equity markets could get choppy as they enter 2026 at record highs that are “over reliant on AI success.” But the team still expects further gains this year, thanks to resilient corporate earnings and a favorable trade off between growth and monetary policy. 

“The first trading day has been an incredibly poor guide in recent times to how the rest of the year plays out,” wrote Deutsche Bank AG strategists including Henry Allen. In fact, “2022 saw an all-time high on the first day, before the index fell into a bear market and its worst year since 2008. Whatever happens today, we really shouldn’t overegg the day one moves.”

The strategists noted that several key themes apart from AI will shape markets in 2026, including new developments in US trade policies and specifically a Supreme Court case that will rule on the legality of levies. The Fed will be another major focus, with President Donald Trump expected to name a successor to Jerome Powell early in the year.

“The scope for further gains driven purely by valuation expansion in 2026 may be limited,” wrote Linh Tran, an analyst at XS.com. “Shocks related to interest rates, earnings, or policy could therefore trigger faster and more pronounced corrections than in earlier phases of the cycle.”

In Europe, the Stoxx 600 is up 0.4% and on course for a record close. Technology stocks are leading gains as they did in Asia after a fresh burst of optimism around artificial intelligence. Miners also outperform as metals rise across the board. The FTSE 100 earlier crossed 10,000 for the first time.  Here are some of the biggest movers on Friday:

• ASML shares gain as much as 3.9% in Amsterdam, the most since late November, as Aletheia Capital double upgrades the chip equipment maker to buy from sell and boosts its price target to a Street high due to investment expansions and capacity upgrades.
• Vestas gains as much as 4%, reaching the highest since June 2024, as JPMorgan says the firm is set to deliver orders above expectations in the fourth quarter, supporting view that fundamentals for the wind industry are improving.
• Munters shares gains as much as 11% after the Swedish industrial ventilation and cooling company received from the US its largest data center technologies order ever.
• Bumech shares jump as much as 26% after a Polish government pledge offering support and job guarantees helped to end a workers’ strike at the machinery firm’s Silesia mine.
• BE Semiconductor shares climb as much as 9.8%, the most since October, following a rally in Asian chipmakers and artificial intelligence-related stocks.
• BAT shares fall as much as 2.7% after its Indian subsidiary ITC dropped in response to the government’s move to sharply raise excise duty on cigarettes.

Asian equities also advanced, led by gains in tech-heavy markets such as Taiwan and South Korea, as most regional markets reopened after a holiday. Hong Kong stocks also moved higher. The MSCI Asia Pacific Index advanced 1.1%, marking its best start to the year since 2012. Tencent, Samsung Electronics and TSMC were among the biggest contributors to the benchmark’s advance. Equities in South Korea and Hong Kong each climbed more than 2%. The Hang Seng China Enterprises Index gained more than 2.8%, posting its best start to a year since 2018. At the start of the year, investors rotated back into familiar leaders in artificial intelligence and technology, pushing the sector’s sub-index to a record high. Markets in Japan, mainland China, New Zealand and Thailand remained closed. Asian markets are edging higher today, but thin liquidity is exaggerating moves as many investors remain on the sidelines, Dilin Wu, a strategist at Pepperstone said. 

“We are seeing a continuation of the run higher in equities, with AI and tech again at the forefront,” said Tim Waterer, chief market analyst at KCM Trade Global. “Asian indices delivered the goods in terms of gains in 2025, and there is reason to believe that this momentum will carry forward into the new year.”

In FX, the Bloomberg Dollar Spot Index is up 0.1% following its worst year in eight, while the Aussie dollar is the best G-10 performer, rising 0.3% against the greenback. The euro underperforms and falls 0.3%.

In rates, treasuries inch higher, pushing US 10-year yields down 1bp to 4.15%. US yields are richer by up to 2bp in intermediate sectors, steepening 5s30s spread by around 1bp on the day. 10-year is near 4.155% after peaking at 4.19% during London morning. European bonds lag Treasuries, with bunds and gilts cheaper by around 3bp and 3.5bp in the 10-year sector

In commodities, spot silver climbs 4% to above $74/oz while gold and most base metals are also green. Aluminum touched $3,000 a ton for the first time in more than three years on expectations of tighter supply. Oil, which suffered its steepest annual loss for five years in 2025, gave back early gains. This weekend, OPEC and its allies are expected to confirm plans to pause supply hikes. Oil traders are also watching developments in Venezuela, Ukraine and Iran. Trump says the US will “rescue” protesters if Iran shoots or kills them, according to a post on Truth Social.

Treasuries hold small gains, leaving yields slightly richer across the curve, after erasing declines that occurred during Asia session, when Australia’s bond market was hit as traders positioned for the possibility the Reserve Bank of Australia will raise rates to quell inflation. Scheduled events during Friday’s US session include only S&P Global US manufacturing PMI revision.

Bitcoin is on a firmer footing and holds just short of the $90k mark, with Ethereum also posting gains above $3k. 

The US economic calendar includes December final S&P Global US manufacturing PMI at 9:45am. No Fed speakers are scheduled. Tesla is expected to report that it delivered about 440,900 vehicles in the fourth quarter, down 11% from a year earlier.

Market Snapshot

• S&P 500 mini +0.6%
• Nasdaq 100 mini +1%
• Russell 2000 mini +0.7%
• Stoxx Europe 600 +0.4%
• DAX little changed
• CAC 40 +0.2%
• 10-year Treasury yield -1 basis point at 4.16%
• VIX -0.1 points at 14.83
• Bloomberg Dollar Index little changed at 1204.54
• euro -0.3% at $1.1716
• WTI crude little changed at $57.37/barrel

Top Overnight News

• Trump threatens Iran over protest crackdown as deadly unrest flares: RTRS
• Threat of California Billionaire Tax Draws Criticism From Ultrawealthy: WSJ
• The Next Class of Senators Won’t Be Able to Dodge the Social Security Crunch: WSJ
• European factory activity ends 2025 in deeper contraction: RTRS
• Tesla Closes Out Brutal Year in Europe With Sales Declines: BBG
• U.S. Slashes Proposed Tariffs on Italian Pasta: WSJ
• Russia says it can prove that Ukraine tried to strike Putin residence: RTRS
• The Condo Market Hasn’t Been This Bad in Over a Decade: WSJ
• Maduro suggests serious talks between Venezuela and US: RTRS
• Venezuelan Exiles Root for U.S. Military Action. Those Left Behind Oppose It: WSJ
• Bezos, Catz, Dell Cashed Out Billions as Top Insider Sellers of 2025: BBG
• Zelenskiy offers chief of staff post to military intelligence boss: RTRS
• Ozempic Users Actually Spend More Dining Out. Smart Restaurants Are Adapting; BBG
• China taxes condoms, contraceptive drugs in bid to spur birth rate: RTRS
• How Kraft Heinz Lost Its Lock on Mac and Cheese—and American Shoppers: WSJ
• China AI chipmaker Biren soars in Hong Kong debut as IPO wave builds: RTRS
• Oil steadies after biggest annual loss since 2020: RTRS

Trade/Tariffs

• US President Trump signed a New Year’s Eve proclamation titled “AMENDMENTS TO ADJUSTING IMPORTS OF TIMBER, LUMBER, AND THEIR DERIVATIVE PRODUCTS INTO THE UNITED STATES”. This included a delay in tariff increases on upholstered furniture, kitchen cabinets and vanities for a year, which keeps the tariff levels for the aforementioned goods at 25%, instead of raising it to 30% for upholstered furniture and 50% for kitchen cabinets and vanities, citing ongoing trade talks, according to Associated Press.
• Italy's Foreign Ministry announced on Thursday that the US sharply lowered the proposed duties on several Italian pasta makers from the additional 92% duty proposed in October, with the tariff for La Molisana set to 2.26% and for Garofalo set to 13.98%, while 11 other producers will face tariffs of 9.09%.
• US granted TSMC (2330 TT) an annual licence to import US chipmaking tools for its facilities in China's Nanjing.
• China’s Ministry of Commerce called the EU’s carbon border tax unfair and discriminatory, while it vowed to take countermeasures to defend the country’s interests, according to a statement on Thursday cited by Bloomberg.
• China set quotas on beef imports as it seeks to protect domestic farmers and producers, in a blow to Brazil and other major shippers, including Australia and Argentina, while shipments exceeding the limits will be subject to a 55% duty, according to the Ministry of Commerce.
• India extended tariffs on steel imports for three years with import levies of 11%-12% proposed for some products, according to Bloomberg. It was also reported that India imposed anti-dumping duties of USD 60.89-130.66/ton on low-ash met coke imports for six months.

A more detailed look at global markets courtesy of Newsquawk

ASX 200 posted mild gains of 0.2% in quiet trade, with hefty losses in gold miners hampering the gains from Energy and Financials. KOSPI jumped about 2% to a fresh record high, helped by a roughly 6% rise in Samsung Electronics, after reports said customers praised its HBM (high memory bandwidth) chips. Hang Seng surged ~2.6%, with gains led by education stocks, while AI chip designer Shanghai Biren gained in excess of 100% following a HKD 5.58bln Hong Kong IPO, which was said to be heavily oversubscribed.

Top Asian News

• Chinese President Xi said in his annual New Year’s Eve speech that the year 2025 marked the completion of China's 14th Five-Year Plan for economic and social development, while he added that they have pressed ahead with enterprise and fortitude, and overcome many difficulties and challenges. Xi added that they met the targets in the Plan and made solid advances on the new journey of Chinese modernisation, as well as noted that economic output has crossed thresholds one after another, and is expected to reach CNY 140tln for the year. Furthermore, he said their economic strength, scientific and technological abilities, defence capabilities, and composite national strength all reached new heights, while he also vowed to reunify China and Taiwan.
• China’s State Council said it studied measures for facilitating cross-border trade, while it will promote green and cross-border e-commerce. Furthermore, it will speed up the review and approval of breakthrough therapeutic drugs, as well as boost investment in water network projects.
• China’s industrial hubs are to lower power prices to support the economic recovery, with the eastern province of Jiangsu, which surrounds Shanghai, to cut rates by 17% vs 2025, while the southern province of Guangdong had recently announced to reduce power prices by 5%.
• Chinese automakers’ market share of Europe’s electric-vehicle market in November reached a record 12.8%, despite the cost of European Union tariffs, according to Bloomberg.
• South Korean President Lee plans to discuss economic ties and peace efforts in the Korean Peninsula during his upcoming summit talks with Chinese President Xi scheduled for early next week.
• Japanese PM Takaichi and US President Trump may hold talks, via telephone on Friday night at earliest, according to Kyodo News citing sources.

European bourses (STOXX 600 +0.6%) began the session around the unchanged mark before rising to session highs soon after the cash open, without a clear driver. Since, indices have dipped off best levels, paring some of the earlier upside. European sectors hold a positive bias, led by Basic Resources (+1.7%), Technology (+1.8%), and Energy (+1.7%). The former is supported by higher metal prices, with gains in gold and copper. On the downside, Food Beverage & Tobacco (-0.3%), Real Estate (-0.3%) and Construction (-0.1%) lag.

Top European News

• UK PM Starmer promised to "defeat the decline and division offered by others" in his new year message and insisted that people would feel a "positive change" in their lives in 2026, according to BBC.
• French President Macron called for unity, strength and hope during his New Year's Eve address, while he pledged to work until the 'last second' of his mandate and guard the 2027 presidential election from foreign interference.

FX

• DXY resides closer to the upper end of a tight 98.14-98.42 in early European hours, following a rather subdued APAC session.
• In terms of today's trade, price action has been relatively muted as volume returns to the market from the holiday period. AUD and NZD outperform amid the broader risk-on sentiment, with the AUD also underpinned by a rebound in gold amid a myriad of geopolitical factors, including US President Trump's warning to Iran this morning that the US is "locked and loaded and ready" to rescue peaceful protesters if Iran opens fire on them. Elsewhere, JPY is flat in a narrow 156.77-157.00 intraday range. Meanwhile, EUR and GBP saw little immediate move from their respective final Manufacturing PMIs.
• 2025 recap: 2025 proved a tough year for the index, which saw its sharpest annual drop in eight years, whilst most majors rallied. The JPY saw gains of under 1% over 2025, in a year rattled by political instability, fiscal woes, BoJ hawkish bias and haven flows. Antipodeans saw the AUD climb nearly 8% over 2025 (best since 2020) and the NZD gained almost 3% to snap a three-year losing streak. The EUR was up 13.5% in 2025 and GBP +7.7% (both their strongest yearly gains since 2017).

Fixed Income

• A softer start for fixed benchmarks.
• Bunds and USTs lower by 20 and a tick, respectively. Specifics are fairly light aside from Final PMIs which, thus far, have not had any real impact. USTs in the red but at the upper-end of a 112-05 to 112-13 band. If a move into the green occurs, resistance factors at 112-25. A similar picture for Bunds, in the red but just off highs in 127.08-49 parameters. Resistance at 127.57 and 127.83.
• For Gilts, a softer open but the benchmark has since climbed off lows and is, as above, towards highs in 90.74-91.33 parameters. 91.37 would take Gilts back to unchanged on the day, thereafter resistance at 91.47.

Commodities

• WTI and Brent trades slightly lower, with prices towards the lower ends of USD 57.08-57.93/bbl and USD 60.51-61.38/bbl, respectively. Focus for the complex lies more on oversupply risks as opposed to any geopolitical risks from the above, with traders also setting sights on this weekend's OPEC+ confab. OPEC+ is expected to reaffirm its production pause through Q1, maintaining the halt to further supply increases, according to Bloomberg sources. The stance reflects concerns over a looming global oversupply backdrop, with crude prices sharply lower over 2025 and forecasters warning of a potential glut in 2026. Delegates indicate little appetite to resume hikes at this stage, according to reports. Recent Saudi–UAE geopolitical tensions have generated headlines, but are widely viewed as noise rather than a threat to OPEC unity, with no expectation that they will spill over into production policy.
• Spot Gold kicked off 2026 on the front foot, with spot prices currently +1.5% intraday towards the upper end of a 4,326.28-4,397.84/oz range at the time of writing. The yellow metal printed a record high at ~USD 4,550/oz on Dec 26th before declining in the subsequent three sessions to a USD 4,274.03/oz trough on 31st Dec, with a near-USD 250/oz drop seen on Dec 29th.
• Geopolitical updates have kept the precious metals complex underpinned, with US President Trump's warning to Iran this morning that the US is "locked and loaded and ready" to rescue peaceful protesters if Iran opens fire on them. Further, tensions flared between OPEC members Saudi Arabia and the UAE, primarily due to an open military and diplomatic confrontation in Yemen, with the two nations now actively backing rival factions and engaging in direct hostilities. In terms of Russia-Ukraine, Ukrainian President Zelensky said they are 10% away from a deal to end the war with Russia, but not at any cost, according to The Independent. That being said, Ukrainian authorities in Zaporizhzhia on the morning of January 2nd noted over 700 Russian attacks on the territory of the province.
• North Sea Buzzard oil field recommenced production on 1st January 2026, according to CNOOC.
• Rail line in Australia used by Glencore (GLEN LN) requires a significant repair job.

Geopolitics: Ukraine

• Ukrainian President Zelensky said they are 10% away from a deal to end the war with Russia but not ‘at any cost’, according to The Independent. Zelensky also announced that a meeting with national security advisors “focused on peace” will be held on January 3rd, and there will be meeting with the military chiefs of general staff on January 5th where the main issue is security guarantees for Ukraine, while he said there will be a meeting with European leaders and the leaders of the Coalition of the Willing on January 6th.
• Ukrainian President Zelensky denied allegations made by Russia that Ukraine launched a drone attack on one of Russian President Putin's residences last Sunday, and accused Moscow of trying to derail peace talks. Furthermore, Russia recently handed over to the US what it claimed was proof of the attempted strike on Putin’s residence, although it was separately reported that US officials determined that the Russian allegation that Ukraine targeted Putin in a drone strike is false, according to WSJ.
• Ukraine's military said on Thursday that it struck Russia's Ilsky oil refinery and the Almetevskaya oil preparation facility, while Ukraine also announced that a Russian drone attack damaged power infrastructure, according to Reuters.
• Russian-installed governor of Ukraine’s Kherson region said at least 24 were killed and over 50 were injured from a Ukrainian drone strike on a hotel and cafe during New Year celebrations, according to Reuters.
• US envoy Witkoff said on Wednesday that he held a “productive call” with European allies on the next steps in the peace process, while he said they “also spent time on the prosperity package for Ukraine – how to continue defining, refining and advancing these concepts, so Ukraine can be successful, resilient and truly thrive once the war is over”.
• Ukrainian authorities in Zaporizhzhia on January 2nd noted of over 700 Russian attacks on the territory of the province "in the past hours", according to Al Jazeera.

Geopolitics: Middle East

• US President Trump posted "If Iran shots and violently kills peaceful protesters, which is their custom, the United States of America will come to their rescue. We are locked and loaded and ready to go. Thank you for your attention to this matter!".
• Israeli Defence Minister Katz urged the IDF to be ready for a potential ‘Oct.7-style’ mass attack on West Bank settlements and called for the reestablishment of northern West Bank military bases which were evacuated as part of a US-backed deal, according to Times of Israel.
• Iran’s defence export agency offered to sell ballistic missiles, drones and other advanced weapons systems to foreign governments in exchange for cryptocurrency and barter, according to FT.
• UAE announced on Tuesday that it was pulling out its remaining forces in Yemen, after Saudi Arabia bombed the Yemeni port city of Mukalla following accusations that two ships from the UAE had delivered weapons and combat vehicles to separatist forces. It was separately reported that Yemen’s government imposed restrictions on flights between Yemen and the UAE to mitigate the ongoing escalation in the country, according to a Saudi source cited by Reuters.

Geopolitics: Others

• US Treasury Department announced new sanctions related to Venezuela, targeting crude oil tankers.
• Russia requested that the US stop pursuing an oil tanker identified as Bella 1, which was headed to Venezuela and was fleeing the US Coast Guard in the Atlantic Ocean, according to The New York Times on Thursday.
• Taiwanese President Lai vowed to defend the nation’s sovereignty in his New Year’s speech days after China fired dozens rockets towards the island and deployed warships and aircraft near Taiwan as part of military drills and a show of force, while he stated that 2026 is a very critical year for Taiwan and that they must stand shoulder to shoulder with democratic countries.
• China's Taiwan Affairs Office said Lai’s New Year's address was riddled with 'falsehoods and reckless assertions, hostility and malice', while it was also reported that China's Defence Ministry said the PLA's drills are completely justified and necessary.

US Event calendar

• 9:45 am: Dec F S&P Global U.S. Manufacturing PMI, est. 51.8, prior 51.8

DB's Jim Reid concludes the overnight wrap

Happy new year and hope you all had a relaxing break. We’ll shortly look at what’s coming up in 2026, but as we usually do at the new year, we’ve just released our review looking at how markets fared in 2025. It was a strong year overall thanks to continued economic growth, optimism around AI, and more central bank rate cuts. So that meant global equities, bonds, credit and EM assets all advanced for the most part. However, those headline gains masked huge volatility, particularly in April when the Liberation Day tariff announcements sparked the 5th biggest two-day slump for the S&P 500 since WWII. Meanwhile, Germany’s fiscal stimulus announcement in March saw the biggest daily jump for the 10yr bund yield since German reunification in 1990. See the full review here for more details on the year just gone.

In terms of the last week-and-a-half whilst we’ve been away, it’s been a story of two halves for markets. Just before Christmas, the S&P 500 moved up to record highs on both Dec 23 and Dec 24, aided by some very strong US data. That included the Q3 GDP print, which was delayed because of the government shutdown, and showed the US economy grew at an annualised pace of +4.3% (vs. +3.3% expected). That was the fastest quarterly growth in two years, and the so-called “core GDP” measure of real final sales to private domestic purchasers was up by a robust +3.0% as well. So that led to a lot of optimism about the economy’s momentum into next year, and the Atlanta Fed’s GDPNow measure for Q4 currently stands at +3.0%.

However, after Christmas the tone became more negative, with the S&P 500 posting four consecutive declines that’s left the index -1.25% beneath its Christmas Eve record. So that took a bit of the shine off the full-year performance, with the index ending the year up +16.4% (and +17.9% in total return terms), falling short of the gains above +20% seen in 2023 and 2024. Meanwhile, there’s been some huge volatility in precious metals, with silver prices up +10.30% on Dec 26, marking their biggest daily jump since September 2008 in the week of Lehman Brothers’ collapse. And after the weekend, they then slumped by -9.00% on Dec 29, the biggest loss since 2020, before there were further swings of more than 5% each way on Dec 30 and Dec 31. That caps off a huge surge in precious metals prices over 2025, with both gold and silver experiencing their strongest annual gains since 1979, up +65% and +148% respectively.

This morning in Asia, markets have got 2026 off to a decent start in the places they've reopened. For instance, the KOSPI (+1.87%) is currently on track for a record high, whilst the Hang Seng (+2.18%) has also surged. Moreover, US equity futures are pointing to a strong start as well, with those on the S&P 500 (+0.43%) and the NADAQ 100 (+0.65%) both higher this morning. However, we shouldn’t extrapolate too far, as the first trading day has been an incredibly poor guide in recent times to how the rest of the year plays out. Indeed, 2023-25 each started with a negative session for the S&P 500, before the index then saw a double-digit annual gain. By contrast, 2022 saw an all-time high on the first day, before the index fell into a bear market and its worst year since 2008. So whatever happens today, we really shouldn’t overegg the day one moves.

When it comes to the year ahead, several themes will be high up the agenda for markets in 2026. First, there are still lots of tariff developments yet to come, most notably with the US Supreme Court case, who are set to rule on the legality of the tariffs imposed under the International Emergency Economic Powers Act (IEEPA). As a reminder, roughly half of the tariff increases under Trump have used IEEPA authority, and the legal challenges so far have been successful in the lower courts, but were appealed by the Trump administration. So we’re now awaiting the ruling from the Supreme Court. Our US economists think there’s a reasonable possibility the IEEPA powers are struck down, but they also expect that if they are, then the administration would pursue other legal avenues to impose its tariff policies. For instance, the sectoral tariffs under section 232 (e.g. to steel and aluminium) aren’t covered by this court challenge. Or another option could be Section 122 of the 1974 Trade Act, which permits temporary 15% tariffs for 150 days. So there are several options the Trump administration still have.

Aside from the court case, there are also a couple of other 2026 trade deadlines. One is the scheduled review of the USMCA agreement, six years after it first came into force in July 2020. The other is the US-China trade truce, which was extended by a year after the meeting between Presidents Trump and Xi back in October. So as it stands, the current US tariff reduction on China only runs until November 10, 2026. Nevertheless, there have been a few tariff reductions in recent weeks, particularly as concerns about affordability have risen up the agenda. So we’ve already seen exemptions for products like coffee and beef, and it was also announced on New Years’ Eve that higher tariffs planned on Jan 1 for upholstered furniture and kitchen cabinets were being delayed by a year until Jan 1 2027. Remember as well that the midterm elections are happening in November, so the political incentive to keep inflation down will rise as they approach.

Second, another key theme for 2026 will be the Federal Reserve, and Trump said on Monday that there’d be an announcement on Chair Powell’s replacement in “January sometime”. For reference, Powell’s term as Chair concludes in May, so the new Chair would be in place by the June FOMC decision, and futures are pricing in another 57bps of rate cuts by the December meeting. In terms of who the new Chair will be, the Polymarket odds continue to have NEC Director Kevin Hassett as the frontrunner (42%), followed by former Fed Governor Kevin Warsh (33%) and current Governor Christoper Waller (15%). Otherwise, the Supreme Court are also set to hear arguments on January 21 about President Trump’s attempt to remove Governor Lisa Cook from the Fed’s Board of Governors. So it’s a big year ahead for the Fed.

Third, we’ve got lots happening on the fiscal side in 2026, as we’ll see the fiscal impulse from the German stimulus, as well as from the One Big Beautiful Bill Act in the United States. All this comes at an interesting time, as 2025 saw periodic market flareups over loose fiscal policy, with sovereign bonds repeatedly seeing large losses before recovering again. That happened in May around the time of the US credit rating downgrade by Moody’s, which pushed the 30yr Treasury yield above 5%. And it was a similar story in Europe too, with a sharp selloff for UK gilts last summer when the government U-turned on welfare cuts, alongside losses for French OATs after PM Bayrou left office and new PM Lecornu resigned after 26 days, before he was reappointed again. So bond markets have been jittery across the board, and last year even saw the biggest jump for Japan’s 10yr yield since 1994 as the BoJ kept hiking rates and the new government under PM Sanae Takaichi announced a further stimulus package.

Fourth, on the political side we have a few elections to look out for. The biggest we know about is probably the US midterm elections, although they’re not until November 3. That will see the full House of Representatives up for election, along with a third of the Senate, and currently on Polymarket, the Democrats are the 81% favourites to retake the House. That would be in keeping with the historic pattern (link here), whereby the incumbent President’s party tend to lose House seats in the midterm votes. Meanwhile in the Senate, the Republicans are 66% favourites on Polymarket to keep control. However, the new Congress doesn’t come into office until January 2027, so in policy terms, that’s more of a story for next year.

Here in the UK, we also have a large set of local elections on May 7, which will be one of the most important midterm electoral tests for the political parties. Although that won’t change the government, PM Starmer’s position has been under increasing pressure, so these elections will be a crucial benchmark for whether he might face a challenge from within the Labour Party. Then in France, the presidential election isn’t until April 2027, but we know that 2026 will be the year that campaigning begins in earnest, with candidates announcing, so we’ll get a much better sense of the state of that race. And over in Japan, a general election isn’t due until 2028, but speculation has been rising about a potential snap election given PM Sanae Takaichi’s approval ratings.

Finally of course, it’s not a single event, but ongoing developments around AI will be critical for the path of markets in 2026. After all, as Jim has written previously, the concentration of the Mag 7 group in US equities means that global markets are incredibly sensitive to their performance. And we shouldn’t forget that AI developments have already led to big reactions in 2025, with the NASDAQ down over -3% on the day that markets reacted to DeepSeek’s new AI model last January. So any loss of momentum or signs that a bubble is bursting risk unwinding the positive wealth effects we’ve seen, as well as the wider surge in capital expenditures that’s helped to support growth.

Looking at the day ahead, there’s not much happening, but data releases include the December manufacturing PMIs from the US and Europe, along with the Euro Area M3 money supply for November.

Tyler Durden Fri, 01/02/2026 - 08:41

Earlier I posted some questions on my blog for next year: Ten Economic Questions for 2026. Some of these questions concern real estate (inventory, house prices, housing starts, new home sales), and I posted thoughts on those in the newsletter (others like GDP and employment will be on this blog).

I'm adding some thoughts and predictions for each question.

Here is a review of the Ten Economic Questions for 2025.

1) Economic growth: Economic growth was probably close to 2% Q4-over-Q4 in 2025. The FOMC is expecting growth of 2.1% to 2.5% Q4-over-Q4 in 2026. How much will the economy grow in 2026?  Will there be a recession in 2026?
A year ago, I argued that "Looking at 2025, a recession is mostly off the table."  I did go on recession watch during 2025 due to the tariffs, but I noted I wasn't forecasting a recession. 
Even though job growth will likely be sluggish in 2026, fiscal policy will be supportive of economic growth and there will be some boost from a rebound from the government shutdown.  So,  I think a recession in 2026 is very unlikely.  Of course there are always exogenous events such as another pandemic, super volcanoes, a major meteor strike or even nuclear war.  
It is possible that we will see a pull back in AI and data center investing, and that might negatively impact growth, but that would likely be a 2027 story.   It is very likely that many of the tariffs will be ruled illegal (they clearly are illegal), but the Administration has other tools to enact tariffs (more economic uncertainty). 
I've expressed concern about unregulated or poorly regulated areas of finance leading to another financial crisis, but that takes a few years to happen.
Here is a table of the annual change in real GDP since 2005. Note: This table includes both annual change and Q4 over the previous Q4 (two slightly different measures).     

Real GDP Growth YearAnnual
GDPQ4 / Q4 20053.5%3.0% 20062.8%2.6% 20072.0%2.1% 20080.1%-2.5% 2009-2.6%0.1% 20102.7%2.8% 20111.6%1.5% 20122.3%1.6% 20132.1%3.0% 20142.5%2.7% 20152.9%2.1% 20161.8%2.2% 20172.5%3.0% 20183.0%2.1% 20192.6%3.4% 2020-2.1%-0.9% 20216.2%5.8% 20222.5%1.3% 20232.9%3.4% 20242.8%2.4% 202512.1%2.1% 1 2025 estimate   Real GDP growth is a combination of labor force growth and productivity.  
Productivity varies and is difficult to predict, but the labor force growth will likely be sluggish in 2026.  So, my guess is that real annual GDP growth will be less than the FOMC expects, perhaps close to 2%.
Here are the Ten Economic Questions for 2026 and a few predictions:
• Question #1 for 2026: How much will the economy grow in 2026? Will there be a recession in 2026?

• Question #2 for 2026:  How much will job growth slow in 2026? Or will the economy lose jobs?

• Question #3 for 2026: What will the unemployment rate be in December 2026?

• Question #4 for 2026: What will the participation rate be in December 2026?

• Question #5 for 2026: What will the YoY core inflation rate be in December 2026?

• Question #6 for 2026: What will the Fed Funds rate be in December 2026?

• Question #7 for 2026: How much will wages increase in 2026?

• Question #8 for 2026: How much will Residential investment change in 2026? How about housing starts and new home sales in 2026?

• Question #9 for 2026: What will happen with house prices in 2026?

• Question #10 for 2026: Will inventory increase further in 2026?

Germany's Economic Collapse: 2025 In Review And What Lies Ahead

Submitted by Thomas Kolbe

Germany’s economy has endured a terrible 2025. Chancellor Friedrich Merz’s government has set the course for further decline in the coming year.

If German politicians’ salaries were linked to private sector growth, lawmakers would likely have to take out loans in the deeply recessive year of 2025 and compensate citizens for parliamentary inaction and ideological foolishness.

Although the term diät derives from the Latin dieta, loosely meaning “compensation,” in the context of Germany’s collapsing industry it more accurately reflects the German meaning: deserved frugality and material austerity. Economically, Germany is now facing the end of the illusion of prosperity, which follows the catastrophic policies of the government.

Shrinking Private Sector and Rising State Burden 

After eight months under Chancellor Merz, the record is not just meager—it is pitiful. Assuming a 50% state quota and calculating real GDP growth of 0.2% with net new debt over 4%, the net result for 2025 is a roughly 3.8% contraction of the private sector compared to the previous year.

What is scarcely known in Berlin—likely a form of economic esoterica not taught in party seminars or union courses—is that only the private sector produces the goods and services people actually consume. It is no surprise that heavy regulation and crushing taxes—Germany is surpassed only by Belgium in the OECD in fiscal extraction—strangle private enterprise.

Investment fell roughly 6.5% below long-term averages—a quantum leap in the wrong direction, deeply impacting labor markets, public budgets, and social security. While Finance Minister Lars Klingbeil attempts to mask deficits and exemptions as mere cosmetic fixes, municipalities face a €35 billion shortfall this year.

Crisis Becomes Visible 

At the lowest levels of the state, in cities and towns, the bill for decades of political mismanagement is now arriving first.

The trigger is collapsing business tax revenue, a direct result of a record number of corporate bankruptcies: 24,000 companies will have exited the market in 2025.

The labor market’s seeming stability is misleading. Hundreds of thousands of new public sector jobs and age-related retirements obscure the collapse of the real economy in official statistics. Merz executed the debt brake with the outgoing Bundestag in April, catapulting Germany into a debt spiral with a €500 billion special fund—a clear indication that policymakers knowingly ran the economy into a wall.

Neither the green “art economy” nor the heavily subsidized military sector will adequately fill freed industrial capacity. Core sectors such as chemicals operate at just 70% capacity, 10% below break-even—a stark signal that the creeping productivity erosion and economic depression since 2018 will worsen, regardless of state credit funneled into centrally planned subsidies.

Welfare State and Refusal to Reform 

Berlin has fully submitted to Brussels’ dreadful climate-socialist doctrine and now faces the challenge of hiding its ideological failure. Merz and his team continue the known media-political strategy: as with migration, a continuous camouflage is maintained.

When it comes to deceiving the public, party headquarters show remarkable creativity, leaving no lie too bold. A deportation flight may be staged for optics, while borders remain wide open, family reunification is promoted, and German passports are handed out freely. The aim is to cultivate new voter bases and apply a “divide et impera” strategy to erode cultural and traditional societal cohesion.

Time is bought and the course maintained—just as in climate policy. Pseudo-reforms, such as the ostensible end to the combustion engine phase-out, serve only to give the struggling auto industry an illusion of technological openness while creating a new bureaucratic monster, ultimately fulfilling Brussels’ objective: halting German automotive production.

From the Eurocrats’ perspective, the results are impressive if the goal was deindustrialization. Around 300,000 industrial jobs were cut in the last five years. And when a nation loses its industrial core, much of its value creation disappears with it.

In 2025, German production hovered about 20% below the 2018 peak. An economic and social catastrophe looms, whose consequences seem intellectually incomprehensible to functionaries and eco-centric elites with regard to social cohesion.

Collision with Reality 

If 2025 was already catastrophic, the coming year will likely be a collision with reality for many Germans. Social contributions and taxes must rise sharply to sustain social security amid migration and demographic pressures.

Merz’s government continues the legacy of Angela Merkel and Olaf Scholz: a Brussels-bound green central planner in the guise of the Ludwig-Erhard party, a political scarecrow devoted solely to consolidating power in Brussels.

The German people, particularly the shrinking class of economic achievers in the middle market, will face an accelerated decline after a dreadful 2025—one the government’s media games can no longer conceal.

Merz’s illustrious “Made for Germany” entrepreneur café was a media fake; “Made in Germany” increasingly belongs to the past. The bitter truth: Germany is done

* * * 

About the author: Thomas Kolbe is a German graduate economist. 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.

Tyler Durden Fri, 01/02/2026 - 08:05

As Lithuania Preps For War, Some Fear They Are Intentionally Stoking It

Via Remix News,

Lithuania is preparing for a possible armed conflict by strengthening bridges near the Belarusian border and building a Baltic defense line, while authorities are trying to avoid causing panic among the population, writes Portfolio, citing a report out of LRT.

Construction and reinforcement work has begun almost simultaneously on several bridges in Lithuania near the Belarusian border.

The Lithuanian Armed Forces confirmed that this is part of a package of fortification measures adopted last July and is related to the construction of the Baltic defense line, which will run along the Russian and Belarusian borders.

According to plans, bridges will have structures that can be rigged with explosives if needed.

In the event of an armed conflict, bridges near the border could be blown up more quickly, which would slow or halt the advance of enemy troops.

The army said the bridges and roads to be reinforced are being selected based on the location of natural obstacles and their strategic importance.

Anti-tank weapons and other terrain obstacles are already being stored at dozens of locations near the border.

Trees are also being planted along major roads for defensive purposes and irrigation ditches are being dug that can be used as trenches and anti-tank barriers.

Populists in the country have been vocal, criticizing such preparations and frequent rhetoric as outright warmongering.

Andrus Merilo, the commander of the Estonian Armed Forces, also spoke of “war hysteria” in October, saying it was seriously counterproductive and could easily cause panic in society.

Lithuanian officials say they are seeking a balance that allows for the presentation of defensive measures but does not incite unnecessary fear.

According to Major Gintautas Ciunis, an employee of the Lithuanian Armed Forces’ strategic communications department, “Russia’s threat remains constant.”

Because of this, conflict preparation should be perceived by society as a regular, long-term activity.

The Lithuanian state, he said, has lived with this threat from Russia for centuries and is expected to live with it in the future.

“That is why constant readiness is essential, and the more intensive this preparation, the greater the chance of effective deterrence,” Ciunis said.

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Tyler Durden Fri, 01/02/2026 - 07:20