Obama Says Aliens Exist But Are Not Kept In Area 51

Authored by Rachel Roberts via The Epoch Times,

Former U.S. President Barack Obama said in a Feb. 14 podcast interview that aliens are real but that none are kept at the secretive Area 51 military base in the Nevada desert, later adding that he didn’t see any evidence indicating that extraterrestrials have contacted Earth during his presidency.

In the interview, when asked, “Are aliens real?” Obama replied, “They’re real, but I haven’t seen them—and they’re not being kept in [Area 51]. There’s no underground facility, unless there’s this enormous conspiracy and they hid it from the president of the United States.”

Obama became the first leader of the United States to affirm the existence of extraterrestrial life when questioned by progressive podcaster Brian Tyler Cohen in a video posted on YouTube.

After the interview went viral, Obama said on Instagram that he wanted to “clarify” his comments to Cohen, writing that he was “trying to stick with the spirit of the speed round” while speaking on the podcast.

“Statistically, the universe is so vast that the odds are good there’s life out there,” he wrote. “But the distances between solar systems are so great that the chances we’ve been visited by aliens is low, and I saw no evidence during my presidency that extraterrestrials have made contact with us. Really!”

In 2013, Obama was possibly the first U.S. leader to acknowledge the existence of Area 51, an Air Force base built during the Cold War, which has long been rumored to house extraterrestrials and unidentified flying objects (UFOs).

Cohen did not ask Obama a follow-up question on the issue. Instead, he asked the former president what his first question had been upon entering the White House. “Where are the aliens?” Obama joked in response.

Some critics, including British political commentator Calvin Robinson, said Cohen should have asked Obama for more information about aliens.

“When a former President of the United States says on the record there are aliens, YOU FOLLOW UP WITH RELEVANT QUESTIONS. You do not continue reading from your script,” he wrote on X.

The U.S. government first acknowledged Area 51’s existence in 2013 through a Freedom of Information request and has declassified documents detailing its history and purpose. The base has been a testing ground for a host of top-secret aircraft, including the U-2 in the 1950s and later the F-117 stealth fighter.

Trump Admin on Aliens

President Donald Trump has expressed skepticism about the existence of aliens, while acknowledging that “anything is possible.”

Trump addressed the subject in several media appearances during the 2024 presidential campaign. On a podcast with Lex Fridman, Trump said he would consider pushing the Pentagon to release additional UFO footage that many believe is classified.

“Oh yeah, sure, I’ll do that. I would do that. I’d love to do that,” Trump said, noting that public pressure to disclose records relating to UFOs is similar to that surrounding the John F. Kennedy assassination.

On Logan Paul’s “Impaulsive” podcast in June 2025, Trump said, “Am I a believer? No, I can’t say I am."

“But I have met with people, serious people, that say there’s some really strange things flying around out there.”

Trump added that given the size of the universe, “Why wouldn’t there be something, somebody?”

Vice President JD Vance has expressed his personal enthusiasm, telling the “Ruthless” podcast in August 2025 that he is “obsessed with the whole UFO thing.”

“What’s actually going on? What were those videos all about? What’s actually happening?” Vance probed.

Director of National Intelligence Tulsi Gabbard said last August that she believes aliens may exist and that the U.S. government holds classified information on the subject.

Director of National Intelligence Tulsi Gabbard in Washington on Dec. 2, 2025. Andrew Caballero-Reynolds/AFP via Getty Images

Gabbard pledged to share disclosures from ongoing investigations into UFOs amid growing discussion of the phenomena at the highest levels of government.

Pentagon Cases Unresolved

The Pentagon’s All-domain Anomaly Resolution Office (AARO) continues to investigate more than 1,600 reports of “unidentified aerial phenomena,” an official term that has largely replaced “UFOs.”

At a Senate Armed Services Committee hearing in November 2024, AARO’s director, Jon T. Kosloski, detailed cases the military believes it has solved—such as the widely circulated 2016 “GOFAST” video, now thought to show an object flying at 13,000 feet rather than right above the water—as well as other incidents which have so far defied explanation.

Previous presidents, including Bill Clinton and Jimmy Carter, have discussed their curiosity about alien life without confirming a belief in it.

Carter reported that he saw an unidentified bright object in the sky when he was governor of Georgia in 1969, although he later said it was likely a natural phenomenon.

A view of Area 51. Google Maps/Screenshot via The Epoch Times

Clinton said that he was curious about the possibility of extraterrestrial life and that he had asked aides to look into both Area 51 and the Roswell incident of 1947, which gave rise to much speculation about a government cover-up. After Air Force personnel recovered metallic and rubber debris near Roswell, New Mexico, the U.S. Army Air Forces announced that they were in possession of a “flying disc” before retracting the statement within a day.

Clinton said he was told there was no evidence of alien life in connection with the incident. In 1995, he joked about the Roswell incident, saying, “If the U.S. Air Force did recover any alien bodies, they didn’t tell me about it.”

The American public is increasingly convinced that aliens exist and have visited Earth, according to recent polls. More than half (56 percent) of Americans believe extraterrestrials definitely or probably exist, according to a 2025 YouGov poll.

Democrat (61 percent) and Independent (59 percent) voters are more likely than Republicans (46 percent) to believe aliens exist, with 73 percent of Americans believing the government would hide evidence of UFOs if it had any, and just 13 percent thinking it would be transparent, according to the same survey.

Tyler Durden Tue, 02/17/2026 - 17:00

Escalation: Iran, Russia, China To Hold Naval Drill In Flashpoint Strait Of Hormuz

Are Russia and China finally standing up to America's addiction to regime change wars in the Middle East? They appear to at least be flashing some muscle in this incredibly tense moment, as the US deploys no less than two nuclear-powered aircraft carriers to the region.

Russia, China, and Iran have deployed naval vessels to the Strait of Hormuz for joint exercises this week, Russian presidential aide Nikolay Patrushev announced Tuesday, according to Anadolu and Iran state media. This comes as Iran's elite IRGC Navy is already in day two of military drills in the vital oil transit point, having closed some sectors of the chokepoint.

Mehr News

In a fresh interview with Turkish media, Patrushev said Moscow is advancing a "multipolar world order on the oceans" to counter what he blasted as Western hegemony.

"We will tap into the potential of BRICS, which should now be given a full-fledged strategic maritime dimension," he said. These fresh mid-February drills are being called Maritime Security Belt 2026.

It turns out Russian and Chinese warships have already been in the region as part of prior Iran-hosted drills, and without doubt they've lingered to keep a very close eye on developments after President Trump started threatening Tehran over its nuclear as well as ballistic missiles programs.

Also coming off last month's BRICS naval drills in South Africa which were dubbed "Will for Peace 2026" - Chinese, Russian, and Iranian ships have in recent years showed deepened coordination and cooperation, in an increased number of joint drills.

"The Maritime Security Belt 2026 exercises in the Strait of Hormuz, where Russia, China, and Iran sent their ships, proved to be relevant," he added.

If the US were to launch a 'surprise' attack on Iran, it remains unlikely that either Russia or China would come to Tehran's direct aid and engage militarily with Washington.

However, it's possible more Chinese and Russian ships would be sent to patrol flashpoint waters, making things more delicate and difficult in terms of US Navy maneuvering and firing.

Likely Moscow and Beijing would team up to issue a UN Security Council condemnation, and would seek to rally the globe against another Iraq-style war in the Middle East, with likely disastrous consequences for the whole region.

The second round of Iran-US talks wrapped up Tuesday in Geneva with mixed results. The Iranians have said the sides could be headed toward a new deal, and yet diplomats have admitted it was a heavy, and not very positive or amicable atmosphere. So things remain ultra-tense and charged, to say the least.

Tyler Durden Tue, 02/17/2026 - 16:40

Bayer Soars After $10.5 Billion Settlement On Current And Future Roundup Cancer Lawsuits

Bayer stock jumped the most in three months after the company announced a $10.5 billion settlement push to settle current and future cancer lawsuits over its Roundup weedkiller. The news was first reported by Bloomberg. 

The German chemical giant proposed a $7.5 billion class-action settlement through cases filed in state court in Missouri designed to resolve Roundup suits that already have been filed and potential claims that could be filed over a 20-year period.

Bayer also announced $3 billion in settlements of existing U.S. cases in which former Roundup users blame the herbicide for causing their non-Hodgkins lymphoma, it reported.

The company has paid about $10 billion to settle most of the Roundup lawsuits that were pending as of 2020, but failed to get a settlement covering future cases. New lawsuits have continued to pour in since then. Plaintiffs have said they developed non-Hodgkin's lymphoma and other forms of cancer due to using Roundup, either at home or on the job.

Roundup, which was acquired by Bayer, is among the most widely used weedkillers in the United States

The class settlement aimed at resolving current and future claims that Roundup weedkiller caused non‑Hodgkin lymphoma is an important addition to its Supreme Court case, Bayer CEO Bill Anderson said on Tuesday.

"We are entering into the settlement because it is an important addition to the case before the Supreme Court, thereby minimising the legal risks as comprehensively as possible," he said. "Both elements are necessary independently of each other and reinforce each other," he added.

Bayer stock surged on news of the settlement.

 

Tyler Durden Tue, 02/17/2026 - 12:20

Investors Overreacting To Starlink's Threat To Traditional Telcos; Goldman Says

Talk of space-based data centers has suddenly become a major conversation on Wall Street. One key driver is Elon Musk's merger of SpaceX with his AI venture, xAI, aiming to eventually build "orbital data centers" at scale.

With a potential IPO later this year, the space industry - first in low-Earth orbit, then on the moon - will be center stage for years to come.

Goldman analysts, led by Andrew Lee, hosted a webcast titled "Space - Datacentres Opportunity and Telecom Risk," featuring Justin Hotchkiss (Associate Partner), Gregor Eichler (Principal), and Federico Torri (Partner) from TMT consultancy Altman Solon.

The webcast conversation looked ahead to a future in which space-based data centers could become a reality.

Goldman's telecom analysts and tech consultants discussed two major ideas:

1. Space data centers: Not yet deployed, but could become a reality in the near term. The advantages are low-cost solar power in space, easier cooling, no property costs, and no permitting issues. One big hurdle is the need for cheaper rocket launch costs and a lightweight cooling system. If launches drop below $200/kg and cooling hardware is very light, the cost could start to look similar to building on Earth.

2. Satellite connectivity for telecoms: It already exists, but investors are overreacting to the idea that satellites will "replace" traditional telcos. Satellites (especially LEO networks like Starlink) have limited capacity, variable service quality, and challenging economics for serving many everyday urban customers. They're most useful where building cell towers or fiber is expensive: rural, sparsely populated, higher-income areas. Think of Starlink and other LEO networks as complementary to telecoms.

A major technological leap is underway in space-based communications. Data centers in space are likely to become a reality within this decade, thanks to SpaceX's Starship rocket. Goldman's webcast suggests that Starlink and other LEO constellations should be more complementary than competitive to telcos for the foreseeable future.

Lee noted:

In the longer term, space data centres appear an increasingly likely reality. More relevant today, our conversation suggests the extent of investor concerns on satellite competition to telecoms and towercos are overstated - as we wrote in our 2025 satellite/telco report.

Satellite technology is more likely to be complementary rather than competitive to telcos due to satellite capacity constraints, service quality restrictions, and inferior economics for the majority of geographies. Telcos can leverage satellites to extend their own network coverage into rural areas where terrestrial build-out is costly.

Investing world impacts:

This would imply modest downside risk to towerco growth if rural connectivity is partially rerouted via satellites.

For towercos including Cellnex and INWIT, some of this satellite risk is already priced into their shares, but we do not see a catalyst for a re-rating in the near term.

For telcos including TMUS (majority owned by DT), where satellite risk to its broadband growth has pressured the share price, we see scope for a rerating as investor concerns over satellite risk abate over time and ongoing consensus upgrades continue.

We retain our bullish view on European telcos as laid out in our recent report - select Buy ideas include BT, Nordics, DT, KPN. We outline our key takeaways from the satellite webcast below.

The big question is: At what point does Starlink start to challenge them directly?

Professional subscribers can read the full note on our new Marketdesk.ai portal​​​​.

Tyler Durden Tue, 02/17/2026 - 11:40

What Price Will You Pay For What You Need?

By Michael Every of Rabobank

A Material Shift

It was that 2026 rarity of a genuinely ‘quiet day’ on Monday with the US out for Presidents’ Day and much of Asia already on holiday for Lunar New Year. However, despite China staying out for the rest of the week, things are likely to shift to a higher gear from today onwards.

The RBA minutes this morning, which explained why rates were hiked 25bps, stated “the latest forecasts produced by the staff were materially stronger than those produced in August and November.” One would hope so, but why were those forecasts stronger? Far more useful is the repeated mention of “material shift” – higher. That’s the case in Australia and world-wide; but not in the way the RBA meant it. We are no longer in a world in which RBA references to (and models of) “aggregate demand” and “aggregate supply” have much relevance. Yes, demand exists. Yes, supply does too. But neither are “aggregate”. Both are now very starkly variate.

The IMF just warned Australia that it’s 5% deposit scheme for first-time home buyers will push up housing inflation and should be scrapped – as others warn it’s already too late to do so. The RBA had warned of the same thing months ago too yet now seems surprised it might have shifted their forecasts and Overnight Cash Rate. That’s as the Fed is also set to loosen bank capital requirements to try to encourage more mortgage lending, and at lower rates – though it has to be said that the US bank share of such lending has declined from 60% to 35% since 2003, arguing some reversal could be warranted in the market.

Beyond such traditional macro stories, raw materials are again of supreme importance and, as in the past, linked to national security. Demand is vast; yet supply is limited in terms of natural availability and the ‘unnatural’ outcome of China dominating their processing. There is nothing aggregate about this. You have something or you don’t. A machine minus one key widget won’t work, so is worthless. Equally, a gun minus a bullet renders you defenceless. So, what price will you pay for what you need?

This is linked to AI, which ‘Anthropic in Venezuela’ shows is about national security. Indeed, the EU Parliament just blocked its MEPs from using AI tools over cyber and privacy fears – though these are perhaps not the high priority targets for foreign intelligence services that they think they are. While politics is hardly a synonym for productivity, should the EU military drop AI, it will be left even further behind the US. Should the EU private sector drop AI too, it would only widen a productivity gap between it and the US and China. If Europe still wants in on any front, that only increases the global urgency to get raw materials and electricity flowing at as cheap a price as possible. What’s the correct interest rate for that?

Yet things are not all inflationary: quite the opposite. As China rolls out its latest agentic AI, Qwen 3.5, and Wall Street smashes firms that suddenly may not have a viable business model, a recent summit in India saw experts warn that the country needs to take immediate action to manage the AI threat to the vast number of services sector jobs it’s created. They offer that “more training” can help the country avoid being left with “obsolete skills” – but is that true? The possibilities opened up by AI could arguably see white collar jobs destroyed at a scale and pace that no political economy is prepared for, let alone a stock market. What’s the correct interest rate for that?

These are, in both the literal and the metaphorical sense of the term, material shifts. Central bank thinking is, as usual, struggling to keep up. The Fed’s Barr speaks on AI and the labor market today, and Daly on AI and the economy: they both wrote those speeches themselves, right?

Meanwhile, US talks with Iran continue today against a backdrop of the IRGC carrying out naval exercises in the Strait of Hormuz. It needs to be repeated that the US continues to surge military power into the region daily: it remains to be seen if that will see Tehran bend or not. Oil prices are up around 1.3% this morning as the market starts to get twitchy.

Russia-Ukraine peace talks continue in Geneva, as Lithuania warned against a ‘hollow” Article 5-like guarantee being offered to Ukraine, Finland warned that Russia is reinforcing its nuclear and Arctic assets near its border, the UK press speaks of Europe creating a deterrent with tactical nukes as if this is a cost-free and risk-free exercise, and Ukraine, in the background, reportedly made its fastest battlefield gains in 2.5 years.

Also note an unconfirmed report Russia allowed limited dollar trading for the first time in years. That follows the Bloomberg story last week that Moscow is prepared to offer the US a major economic deal. As noted here many times before, the geopolitical and geoeconomic landscapes are one and the same, and our financial architecture merely sits on top of it. Likewise:

• Trump said he’ll make a decision soon on whether to sell the planned $20bn package of arms to Taiwan or not – there will be regional, if not global, consequences either way.

• The EU floated that 70% of EVs must be made in there to qualify for state aid, with similar rules for aluminium: that’s a material shift towards either Gaullism or Trumpism. Yet as the Economist claims that ‘Russia’s economy has entered the death zone’, the Ukrainian press reports EU companies are keeping Moscow’s war machine running via their exports to its auto sector.

• The Eurogroup president said a new Franco-German-led ‘E6’ format to push ahead with deeper structural reforms will only be “temporary”, as Ireland, which was left out, is pushing back. Does that imply that a vanguard group form new structures and then other EU members can then join at their leisure, or will they have to go through some form of a new ‘accession’ process to qualify for this inner sanctum? That’s another material shift.

• Canada’s natural resources minister is going to Poland to promote Canada’s nuclear energy expertise. That’s as the Financial Post notes, 'We need to wake up': Atlantic Canada a microcosm of the problems facing the rest of the country’, and shares ‘David Rosenberg: Memo to Mark Carney: Don’t bring a butter knife to an economic gun fight.’

The same can be said about central bank models.

Tyler Durden Tue, 02/17/2026 - 11:20

SpaceX Enters Secretive Pentagon Contest To Build Voice-Controlled Drone Swarm Tech: Report

Last week, we asked whether Anthropic's AI tool, Claude, played a role in the kill chain during the U.S. Delta Force raid targeting Maduro last month. We've also reported on the Department of War's search for "war unicorn" startups, and what appears to us to be the early innings of the rise of dual-use technologies - from humanoid robots to drones - reshaping the modern battlefield.

A new Bloomberg report states that Elon Musk's SpaceX and its wholly owned subsidiary, xAI, are competing in a classified DoW contest to develop voice-controlled, autonomous drone-swarming technology. This report is based solely on "people familiar with the effort."

The people describe the DoW content as lasting for 6 months with an end price of $100 million. The aim is to use chatbots to direct commands to drones across multiple domains, air and sea, to complete a set of missions.

The contest is jointly run by the Defense Innovation Unit and a new Defense Autonomous Warfare Group element within U.S. Special Operations Command, and remains associated with the Biden-era "Replicator" push to deploy drones on the modern battlefield.

The report highlights a potential shift for Musk: While SpaceX is already a major defense contractor in the space domain, he has supported limiting offensive capabilities for autonomous weapons and previously signed a 2015 open letter warning about AI weapon risks.

Why Musk has changed his mind on autonomous weapons remains unclear. But as we've shown readers, the war in Ukraine has supercharged the development of drones, ground robots, and AI kill chains, pulling 2030s-era war technology forward and leaving the world dangerously unprepared for the rise of this new war tech.

However, the DoW has recently recognized this new, challenging future, as we note that the rise of "war unicorns" is underway, with major defense primes facing an "adapt or die" moment.

xAI has been recruiting engineers with active "secret" or "top secret" clearances and has already secured DoW-related work to integrate its Grok chatbot into government systems, including a previously reported $200 million contract.

Bloomberg noted, "xAI isn't the only advanced AI company working on the new Pentagon effort. OpenAI is supporting a successful submission from Applied."

Related:

• Humanoid Robots Get "Brains" As Dual-Use Fears Mount

The writing is on the wall: 2030s war tech is here.

Tyler Durden Tue, 02/17/2026 - 11:00

Trump Calls In FEMA To Respond To Sewage Disaster In Potomac River

Authored by Jill McLaughlin via The Epoch Times,

President Donald Trump is directing federal emergency teams to respond to a sewage spill on the Potomac River, calling it a “massive ecological disaster” and blaming local leaders for not handling the crisis, which began nearly a month ago.

“There is a massive Ecological Disaster unfolding in the Potomac River as a result of the Gross Mismanagement of Local Democrat Leaders, particularly, Governor Wes Moore, of Maryland,” Trump posted on Truth Social on Feb. 16.

Moore’s office didn’t immediately return a request for comment on Trump’s statement.

On Jan. 19, a section of the Potomac Interceptor sewer line collapsed, causing the failure of a 60-year-old, 72-inch concrete pipeline along the Clara Barton Parkway in Montgomery County, Maryland.

Over 250 million gallons of sewage poured into the Potomac River in one of the largest spills in U.S. history, according to University of Maryland researchers. Water samples collected at the site show high levels of E. coli and Staphylococcus aureus, the bacteria that causes staph infections, researchers reported.

“People coming into contact with the impacted water or land are at risk of becoming infected with these bacteria, which can lead to serious health conditions,” said Dr. Rachel Rosenberg Goldstein, a microbiologist and assistant professor at the university.

Trump said the spill was the “result of incompetent local and state management of essential waste management systems.”

“It is clear local authorities cannot adequately handle this calamity,” Trump stated.

“Therefore, I am directing federal authorities to immediately provide all necessary management, direction, and coordination to protect the Potomac, the water supply in the Capital region, and our treasured National Resources in our Nation’s Capital City.”

Despite state and local leaders not asking for federal assistance, Trump said he “cannot allow incompetent local ‘leadership’ to turn the river in the heart of Washington into a disaster zone.”

The Federal Emergency Management Agency (FEMA), part of the Department of Homeland Security (DHS), will play a key role in coordinating the response, the president stated.

FEMA and DHS are facing a partial funding lapse as Democrats in the U.S. Senate demand changes to immigration enforcement.

Crews work to keep raw sewage from flowing into the Potomac River after a pipeline rupture, in Glen Echo, Md., on Jan. 23, 2026. Cliff Owen/AP Photo

According to Virginia’s health department, the utility DC Water is handling repairs to the pipe, while Maryland has regulatory authority over the Potomac River for recreational advisories, water quality monitoring, and issuing bans on shellfish harvesting.

The Virginia Health Department was working with the Maryland departments of Health and the Environment during the crisis.

DC Water has stated that drinking water is not affected by the incident.

The nearest Virginia location using the Potomac River as a primary source of water is the city of Fairfax, with an intake located several miles upstream of where the sewage spill entered the river, according to Virginia.

Tyler Durden Tue, 02/17/2026 - 10:40

Hyatt Executive Chairman Thomas Pritzker Resigns Over Epstein Ties

Authored by Tom Ozimek via The Epoch Times,

Thomas J. Pritzker, the longtime executive chairman of Hyatt Hotels Corporation, announced his retirement effective immediately on Feb. 16, acknowledging what he described as “terrible judgment” in maintaining contact with convicted sex offender Jeffrey Epstein and his associate Ghislaine Maxwell.

Pritzker, 75, said in a statement released by the company on Monday that he will also not stand for reelection to Hyatt’s board of directors at the company’s 2026 annual shareholder meeting.

In a letter shared by the company, Pritzker said that “good stewardship also means protecting Hyatt, particularly in the context of my association with Jeffrey Epstein and Ghislaine Maxwell, which I deeply regret.”

"I exercised terrible judgment in maintaining contact with them, and there is no excuse for failing to distance myself sooner,” he said.

“I condemn the actions and the harm caused by Epstein and Maxwell, and I feel deep sorrow for the pain they inflicted on their victims.”

Hyatt’s board said in a separate statement it had appointed president and CEO Mark S. Hoplamazian to succeed Pritzker as chairman, combining the roles of chairman and CEO effective immediately.

“Tom’s leadership has been instrumental in shaping Hyatt’s strategy and long-term growth, and we thank him for his service and dedication to Hyatt,” Richard Tuttle, chair of the board’s Nominating and Corporate Governance Committee, said in a statement.

“The Board has engaged in thoughtful succession planning, and we are confident that Mark’s deep knowledge of Hyatt’s business, strong relationships with owners and colleagues, and proven track record as CEO of nearly two decades positions him well to serve as Chairman and continue driving Hyatt’s long-term success.”

Pritzker had served as executive chairman since 2004 and had been involved with Hyatt and its predecessor entities for more than four decades. During his tenure, the Chicago-based hotel operator went public, expanded its global footprint, and shifted toward an asset-light business model.

In his Feb. 16 letter to fellow directors, Pritzker described the company as being in a “strong and sustainable position” with a “world-class management team” and said he would turn his attention to his family foundation and other activities.

Neither Hyatt nor Pritzker detailed the extent of Pritzker’s contacts with Epstein or Maxwell, and there have been no allegations of criminal wrongdoing against Pritzker.

His resignation comes amid a wave of high-profile departures following the Department of Justice’s recent release of millions of documents related to Epstein, who was arrested in 2019 on federal sex trafficking charges and later found dead in a Manhattan jail cell. New York City’s medical examiner ruled the death a suicide.

Maxwell, a longtime associate of Epstein, was convicted in 2021 of helping recruit and groom underage girls for sexual abuse and was sentenced to 20 years in prison.

The released files show that Pritzker and Epstein exchanged friendly emails after Epstein was convicted in 2008 of soliciting a prostitute and procuring a child for prostitution.

In recent weeks, several prominent figures have stepped down from leadership roles after their names appeared in emails and other documents linked to Epstein.

Among them, Kathryn Ruemmler announced she would resign as Goldman Sachs’s general counsel after emails she exchanged with Epstein were made public. Ruemmler has said she regrets ever knowing Epstein and described her contact with him as professional.

Others who have left posts include talent executive Casey Wasserman, law firm chairman Brad Karp, and senior corporate and diplomatic figures whose communications with Epstein or Maxwell drew public scrutiny.

Tyler Durden Tue, 02/17/2026 - 10:00

Nuclear Reactor Transported By Air For First Time In 60 Years

In coordination with the Department of War and the Department of Energy, Valar Atomics has transported their high-temperature gas-cooled reactor from California to Utah via C-17. 

The event marks a major turning point for the nuclear industry, as reactor developers had been seen until this point as just another group of boring construction teams and quiet operators. But the more glamorous side of venture capital funded efforts is starting to make its way into the world of fission.

Today, the Department of War will execute Operation Windlord, the first C-17 airlift of a nuclear reactor, in partnership with the Department of Energy and Valar Atomics.

Three C-17s Globemasters carrying the 8 modules of the Ward250 reactor will fly from March ARB to Hill AFB. pic.twitter.com/uIL7LMxACQ

— Isaiah Taylor - making nuclear reactors (@isaiah_p_taylor) February 15, 2026

Nuclear energy has suffered from decades of neglect and atrophy, and it appears the newest generation of venture capitalists and entrepreneurs are finally taking interest in the nuclear industry again. 

Coverage of the event has been provided by all the major outlets including Reuters and Wall Street Journal, but there is a lack of understanding for what's actually going on. None of the news agencies reporting on the event have provided any added context to the history of reactors up in the air, what Valar Atomics is trying to do, and frankly what was even inside the plane.

Valar constructed their Ward250 gas reactor in their facility in California. There is no fuel added to the reactor core yet, as shipping that through the air would be a regulatory nightmare in today's environment. To put out the fires of some of the fear-mongering that has been going around about the event, which will come off as underplaying the advanced engineering and fabrication that went into the production of the components, all Valar did was ship a complicated piece of metal in a cargo plane. 

To be sure, the company has made significant progress toward meeting the July 4th criticality timeline set by last year's nuclear executive orders. Taking a reactor critical means the reactor goes from a dormant, shutdown state to the point where the uranium inside the core is undergoing a sustained, controlled rate of fission (atoms splitting apart and releasing energy) on its own. 

And this latest milestone with government agencies was a phenomenal exercise in complicated logistical coordination, private-public partnerships, and capability demonstrations. 

One of the biggest errors in most of the reporting is that this is the first time a reactor has been put up into the sky. This can unfortunately not be further from the truth, even though Secretary Wright tries to make the same claim.

President Trump promised to unleash American energy dominance.

Today, this administration advanced that mission by moving a nuclear reactor by air for the very first time. pic.twitter.com/l3kNFHUapa

— Secretary Chris Wright (@SecretaryWright) February 16, 2026

Scrolling all the way back to the 1950s, as the world was proving nuclear energy could be used for other than weaponry and destruction, President Eisenhower's Atoms for Peace initiative sent a nuclear reactor across the Atlantic to Geneva, Switzerland. It was a pool-type research reactor built and tested in Tennessee. The reactor was dismantled and flown to Geneva where it was rebuilt and taken critical again.

Also in the 1950s, the U.S. pursued nuclear-powered long-range bombers before cruise missiles were developed. The Aircraft Nuclear Propulsion Program developed the Aircraft Shield Test Reactor and flew it in the air with fuel while operating under a multi-year test program. The reactor was never used to directly power an aircraft and the program was eventually shut down. 

The third major “reactor in the air” was the PM-1 reactor developed under the Army's nuclear program in the 1960s. After initial construction in Maryland, the TM-1 was disassembled and shipped through the air to South Dakota and then to its final destination in Wyoming where it was assembled and operated. 

All things considered, the event is a huge win for the nuclear industry. Nuclear energy is finally getting some of the attention it needs to make further strides in public approval and federal support.

Tyler Durden Tue, 02/17/2026 - 08:40

Futures Fall As AI Selloff Resumes

US equity futures woke up after President's Day and chose to resume their selloff (after a modest bounce on Monday's holiday failed to hold) dragged by Tech, as the risk-off moves on AI disruption fears continue. As of 8:15am ET, S&P 500 futures were down 0.5% with Nasdaq 100 contracts falling 1.0%. In premarket trading, all Mag 7 stocks are lower and Semis are being pressured with AVGO / NVDA lower by more than 1%. Pockets of outperformance (and higher absolute returns) can be found in Energy, Fins, Indu, and Defensives. Overseas markets mixed with UK up 70bps, Hong Kong, mainland China, Taiwan, Korea all closed. Lunar New Year Kicks off. Bond yields are low by 1-3bp as the yield curve bull flattens; the USD is bid higher. Commodities are weaker with WTI rising modestly on geopolitics and Ags / Metals for sale. Spot gold dropped toward $4,900 an ounce. Bitcoin, as usual, dumps. This morning we will receive the weekly ADP, Empire State manufacturing survey and NAHB housing market index for February. We will also hear from Fed Governor Barr and San Francisco Fed President Daly; key macro prints come on Friday with PCE and Flash PMIs. 

In premarket trading, MAg 7 stocks are all lower (Amazon -0.3%, Apple -0.2%, Microsoft -0.5%, Nvidia -0.9%, Meta -0.6%, Alphabet -1.5%, Tesla -1%)

• AeroVironment (AVAV) gains 3% as JPMorgan initiates coverage with a recommendation of overweight following a selloff in the the drone maker’s stock.
• Fiserv (FISV) rises 4% after the Wall Street Journal reported that activist investor Jana Partners has built a stake in the fintech company, citing people familiar with the matter.
• General Mills (GIS) falls 3% after the packaged foods company cut some forecasts for the full year.
• ImmunityBio shares (IBRX) gains 6% after the drugmaker said the Saudi Food and Drug Authority encouraged the company to submit a regulatory package for its bladder cancer therapy to expand access in Saudi Arabia.
• Masimo (MASI) jumps 34% after the Financial Times said Danaher is closing in on a nearly $10 billion deal to buy medical technology company, citing unidentified people familiar with the matter. Shares of Danaher (DHR) fall 6%.
• Norwegian Cruise (NCLH) rises over 7% after the Wall Street Journal reported that activist investor Elliott Investment Management has built a more than 10% stake in the cruise-ship company.
• TripAdvisor (TRIP) inches less than 1% higher after Starboard Value LP announced plans to nominate a majority slate of director candidates for the 2026 annual meeting.
• Veeva Systems (VEEV) rises over 1% as Morgan Stanley upgrades the the application software company to equal-weight, saying competitive risks are “better understood.”
• Warner Bros Discovery Inc. (WBD) rises over 2% after agreeing to temporarily reopen sale negotiations with rival Hollywood studio Paramount Skydance Corp., setting the stage for a potential second bidding war with Netflix Inc. Shares of Paramount Skydance (PSKY) gain 3%.
• Zim Integrated Shipping (ZIM) surges 35% after Hapag-Lloyd AG said it’s buying the Israeli shipping company.

In other corporate news, WSJ reports that activist Elliott is said to have built a large stake in Norwegian Cruise Line. Apple will hold a product launch on March 4. Anthropic’s talks to extend a contract with the Pentagon are said to have stalled on surveillance concerns. The Pentagon is also said to be seeking voice-controlled, autonomous drone swarming technology, with SpaceX among companies competing. 

US traders are returning to their desks eying firms’ swelling AI budgets, while also wary of the technology’s potential to hurt industries outside the tech sector. Meanwhile, Brent crude erased losses as Iran talked up military drills near the Strait of Hormuz — at the same time that the country is undertaking a fresh round of indirect nuclear negotiations with the US.

There’s “lingering anxiety about whether AI spending will be profitable enough, concerns about competition, and a broader de-risking from the most crowded trades after a very strong run,” said Aneeka Gupta, macroeconomic research director at WisdomTree.

The search for stocks on the right side of the artificial intelligence trade is front and center for investors at the start of a shortened week — with a backdrop that may benefit selective buyers. The “perception of AI seems to have changed completely from the angel of mercy to the kiss of death,” said Stephan Kemper, chief investment strategist at BNP Paribas Wealth Management. Concerns as to whether hyperscalers can monetize ever-growing investments in AI are back while “the fact that AI can often be a tool to enhance profitability is completely ignored,” Kemper added. Two opposing fears are evident - one that AI is poised to disrupt entire industries, the other that investors are skeptical of whether the huge capex outlays will deliver Alibaba unveiled a major update of its flagship AI model, ahead of a much anticipated release from DeepSeek. AI even gets into the Fed’s narrative with Barr due to speak on AI and the labor market, and Daly on AI and the economy later today.  returns. And AI is dominating conference calls.  

A record number of investors say companies are spending far too much, according to Bank of America Corp.’s latest fund manager survey. A quarter of participants saw an “AI bubble” as the top tail risk to markets, while 30% said capital expenditure on AI by the big tech companies was the most likely source of a credit crisis.

Meanwhile, two-year forward earnings estimates for software stocks have risen over the last three months, undeterred by the selloff over AI disruption worries, according to Goldman analysts, while RBC strategists say equity market is witnessing a type of “sentiment unwind” on AI jitters that likely has more to go. 

Over the weekend, Rubio spoke at the Munich Security Conference and emphasized the important of the deep ties between the US and EU, but also echoed the Trump administration’s talking points about the threat of Western decline (WSJ). RTRS reported the Pentagon preparing for the potential for a weeks-long campaign against Iran should Trump decide to launch another round of strikes which comes as the IRGC was conducting "smart drills" near the Strait of Hormuz. Also over the weekend, Trump said Rubio is in talks with Cuba as the island nation faces worsening economic conditions. Trump also said he’s speaking to China’s XI Jinping about weapons sales to Taiwan. Iran’s foreign minister met the UN nuclear chief before the next round of negotiations with the US. 

Brent traded 0.1% higher to $68.75 a barrel in London after Iranian state TV in the Islamic Republic reported that parts of the Strait of Hormuz, one of the world’s most important oil-shipping lanes, will be closed for “several hours” on Tuesday as part of Iran’s military exercises. The drills, announced previously, come as Iran and the US start a second round of negotiations in Geneva.  Trump has threatened to strike Iran unless it agrees to a deal curbing Tehran’s nuclear program in exchange for sanctions relief. He’s mobilized warships and fighter jets near Iran in response to a recent deadly crackdown by the regime there following mass protests.

Looking at earnings, out of the 371 S&P 500 companies that have reported so far in the earnings season, 76% have managed to beat analyst forecasts, while 20% have missed. Medtronic, Genuine Parts and Vulcan Materials are among companies expected to report results before the market opens. Medtronic’s organic revenue growth for fiscal 3Q is likely to exceed the consensus estimate of 5.5%, driven by strong sales of pulsed field ablation products used to treat atrial fibrillation, reflecting robust demand seen at peers like Boston Scientific and Abbott, Bloomberg Intelligence said. Earnings from Palo Alto Networks and Toll Brothers follow later in the day.

European stocks holding firm with Stoxx 600 up by 0.1%. The utilities sector outperforms as artificial intelligence worries linger and tensions in the Middle East drive a risk-off mood among investors. Miners lag as precious and industrial metals prices drop. On the data front, UK employment data surprised to the downside where the unemployment rate rose to 5.2%, above consensus and the BOE's forecast of 5.1%. Following the print, odds for a BOE cut in March cut rose to ~80% (vs ~70% Friday). Here are some of the biggest movers on Tuesday:

• Avolta shares rise as much as 5.7% to the highest level since 2021 after UBS upgraded the travel retailer to buy, citing an improving business model focus and favorable industry trends.
• Genmab shares climb as much as 2.7% after Jefferies resumed coverage on the stock with a buy rating, highlighting the Danish biotech company’s attractive valuation and “catalyst rich” 2026.
• SSP shares surge as much as 11%, touching the highest level since December. UBS raised its recommendation to buy from neutral as analysts expect the catering firm’s focus on cash flow generation to ease concerns.
• Mol shares drop as much as 4.1%, down for the third day. The company said it is seeking a release of Hungarian strategic oil reserves to keep refineries operating.
• BFF Bank shares fall as much as 12% to a record low after confirming a report that Italian prosecutors opened an investigation into the specialist lender.
• Qiagen shares slide as much as 4.8% following a Financial Times report that Danaher could announce a roughly $10 billion deal to acquire US medical technology firm Masimo.
• Antofagasta shares sink as much as 5.2% in London. The copper miner’s earnings and dividend payout underwhelmed some analysts, while it kept its guidance unchanged.
• Hensoldt shares slip as much as 4.7%. Mediobanca initiated the stock with an underperform rating on valuation concerns. It leads a drop in European defense stocks ahead of new rounds of Russia-Ukraine peace talks and US-Iran nuclear talks in Geneva on Tuesday.
• Truecaller shares plunge as much as 26% to a record low after the Swedish developer of a caller ID and spam-blocking app gave what JPMorgan analysts called “disappointing” commentary on advertising and the firm’s Truecaller for Business segment.

Earlier in the session, stocks fell in Japan, offsetting gains in India and Thailand, on a day when most of the region’s markets were closed for Lunar New Year. The MSCI Asia Pacific Index was steady, while Japan’s Topix slid 0.7%. SoftBank Group and Hitachi were among the biggest drags, while BHP Group gained. Stocks also retreated in New Zealand, while shares edged higher in Australia, Thailand and India. Volumes were thin, with bourses closed in markets including China, Hong Kong and South Korea. Japanese stock investors extended profit-taking after last week’s post-election gains, as concerns about disruption from artificial intelligence linger.

In FX, the pound weaker but off the low. The Bloomberg Dollar Spot Index little changed with DXY $97, yen and the kiwi outperforming. The yen, historically seen as a haven, strengthened 0.2% against the dollar.

In rates, the risk-off mood and last week’s slower inflation print buoyed Treasuries, lowering the yield on the 10-year note two basis points to 4.03% and sharply lower than beginning of the month and basically at one-year lows; gilts outperformed in Europe after weak jobs data firmed up bets on BOE interest-rate cuts in 2026. In the US, treasuries hold small curve-flattening gains as US trading resumes after Monday’s holiday, with yields having reached new lows for this year, at 4.016% for the 10-year. Most sovereign bond markets also have gains, led by Japan’s, following strong demand for an auction of five-year notes. Yields remain lower by 0.5bp to 2.6bp following the market’s biggest weekly gain since August, driven by softer-than-estimated January CPI data released Friday and volatility in risk assets including US stocks. For IG corporate new-issue calendar, underwriters anticipate weekly supply totaling about $24 billion; about $40 billion was priced last week, with roughly half in the form of Alphabet’s jumbo offering. Treasury coupon auctions this week include $16 billion 20-year new issue Wednesday and $9 billion 30-year TIPS new issue Thursday

In commodities, crude moving higher with WTI $64 up 150bps after Iran said military drills will close part of the Strait of Hormuz for several hours; the rest of the commodities complex lower led by front month gas off 3% to $3.15. Gold weaker, down about $69 to $4,922/oz, and silver sinking to about $74/oz. 

The US economic data calendar ADP weekly employment change (8:15am), February Empire manufacturing (8:30am) and February NAHB housing market index (10am). Fed speakers scheduled include Governor Barr (12:45pm) and San Francisco Fed President Daly (2:30pm)

Market Snapshot

• S&P 500 mini -0.2%
• Nasdaq 100 mini -0.6%
• Russell 2000 mini -0.2%
• Stoxx Europe 600 +0.2%
• DAX +0.3%, CAC 40 +0.2%
• 10-year Treasury yield -2 basis points at 4.02%
• VIX +0.7 points at 21.85
• Bloomberg Dollar Index little changed at 1183.25
• euro little changed at $1.1844
• WTI crude +0.9% at $63.44/barrel

Top Overnight News

• German investor optimism fell in February, with the ZEW institute's expectations index decreasing to 58.3 from 59.6 in January, in blow to recovery: BBG
• Traders cemented bets on two BOE rate cuts in 2026 after UK unemployment approached the highest level in five years and wage growth cooled: BBG
• Iran and the US met for a second round of nuclear talks in Switzerland as they seek to avoid renewed conflict in the Middle East. Iranian officials have expressed willingness to discuss their nuclear-enrichment activities, but have tied any concessions to the potential easing of American sanctions: BBG
• A growing number of Wall Street pros say now might be the time to get greedy as AI fear runs amok in the US equity market. Investors are selling entire industry groups when a new AI tool threatens to upset an industry, presenting a chance to buy, according to money managers and analysts: BBG
• Spanish PM Sanchez said the Council of Ministers will invoke Article 8 to ask the Public Prosecutor to investigate Meta (META), X and TikTok.
• EU privacy watchdog opens probe into X over sexualised AI images: FT.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks traded mixed amid the extremely thinned conditions due to the Lunar New Year holiday and in the absence of a lead from the US, where markets were closed for Washington's Birthday/Presidents' Day. ASX 200 was led higher by outperformance in miners as BHP shares surged after the mining giant reported a 28% jump in H1 net, although gains in the broader market were capped by weakness in tech and real estate. Nikkei 225 retreated shortly after the open with SoftBank and heavy industry stocks leading the declines, as the post-election euphoria petered out following the recent underwhelming GDP data.

Top Asian News

• Japanese PM Takaichi to unveil a sweeping budgeting reform, placing strategic investments under a ringfenced multi-year framework to enhance predictability and attract private capital, Nikkei reports citing a draft
• Japan PM Takaichi considers multi-year budget for growth and crisis management, according to Nikkei citing her draft policy speech for Friday.
• Japanese Finance Ministry estimate indicates annual bond issuance could rise 28% three years from now amid increasing debt financing costs, according to Reuters.
• Indian Government Minister said we are discussing age-based social media ban with firms.

European bourses (STOXX 600 +0.2%) initially started on the backfoot but have reversed earlier losses and are now trading mostly in the green. The SMI (+0.7%) leads, while the AEX (+0.2%) lags, weighted on by losses in ASML (-1.3%). FTSE 100 (+0.5%) sits near the top of the pile, aided by softer-than-expected jobs and wages data, increasing the likelihood of BoE rate cuts. European sectors are mostly firmer. Utilities (+1.3%) and Insurance (+1.2%) reside near the top, with insurance names helped by a broker upgrade for AXA (+1.8%, initiated with outperform at RBC) and a sector perform rating for Allianz. Basic Resources (-1.4%) is the clear underperformer, weighed on by metal prices (XAU -1.3%, XAG -2.4%).

Top European News

• The German Chamber of Industry and Commerce raises its 2026 GDP growth forecast from 0.7% to 1.0%.
• Swedish Finance Minister said they are not expecting to join the Euro in the coming years.
• UK government quietly shelved a programme to build a frictionless post-Brexit trade border, after spending GBP 110mln on a contract with Deloitte and IBM for the project, according to FT.
• EU officials held a constructive meeting to strengthen the international role of the euro on Monday, according to EU's Dombrovskis.

FX

• DXY trades flat intraday but at the lower end of a tight 97.072-97.247 range as US participants gear up to return from the long weekend. Focus has been on geopolitics as US-Iran talks look to continue through to the afternoon, whilst US-Ukraine-Russia trilateral talks have now been moved to tomorrow. On the data front for the day ahead, weekly ADP jobs data are due (prev. showed an average of +6.5k/week over the four-week period). Elsewhere, the Empire State Manufacturing Index for February, and the NAHB housing market index for February are scheduled.
• JPY gained as risk sentiment in Japan deteriorated shortly after the open, while there were some recent comments from former BoJ board member Adachi, who sees a likelihood that the BoJ will hike rates by 25bps in April. During European hours, the JPY remains the outperformer as US yields fall, but overall, the pair remains within the ranges of the last four trading sessions, with today's current parameters between 152.70 and 153.75. Note, JPY could also be seeing some haven flows against the backdrop of the US-Iran talks today.
• GBP fell in the aftermath of a dovish jobs report: unemployment unexpectedly rose to 5.2%, just below the BoE’s 5.3% peak forecast (raised in February), while wage growth slowed across both measures, especially including bonuses. GBP/USD have recovered off its worst levels with the pair currently around the middle of a 1.3552-1.3633 intraday range at the time of writing.
• EUR marginally trickled lower, but with price action kept within tight parameters near the 1.1850 level amid light newsflow from the bloc and the recent mixed EU Industrial Production data. Some risk was taken out for the EUR (for today) as the US-Ukraine-Russia trilateral meeting has been pushed back to tomorrow. A modest four-pip immediate dip was seen as German ZEW disappointed, with EUR/USD currently in a 1.1828-1.1852 range.

Central Banks

• RBA Minutes from February meeting stated that members agreed that prevailing uncertainties meant it was not possible to have a high degree of confidence in any particular path for the cash rate. Board concluded inflation would stay stubbornly high if it had not hiked interest rates as it did this month. Members agreed that the data received since the previous meeting had strengthened their concern that without a policy response, inflation would remain persistently above target for too long.
• NBP Member Dabrowski says April would be safer to cut rates than in March, a policy rate of 3.5% in 2026 is achievable.

FX

• USTs move higher this morning by around 7 ticks, currently trading within a 113-03 to 113-14 range. From a yield perspective, the 10yr is now eyeing the 4% mark (currently 4.025%), and trading at lows not seen since late Nov’25. Much of the upside can seemingly be attributed to the muted risk tone, in an environment clouded by geopolitical uncertainty, with US-Iran and US-Ukraine-Russia talks taking place. The former arguably holds added risk, given there is some chance that the US could strike Iran if talks break down – though analysts believe that the most likely outcome is not a full deal today but a decision to keep talks alive. (Full analysis piece can be found on the Newsquawk feed)
• Bunds follow the global fixed income complex higher. In reaction to the UK’s jobs/wages data, Bunds spiked higher from 129.30 to 129.41. Currently trading higher by around 15 ticks and at the upper end of a 129.13 to 129.36 range – the 10yr yield is trading well outside recent ranges, around 2.733%. Further pressure could see the 10yr test 2.70%, which happens to be the trough from the 1st of December 2025. Following the softer-than-expected ZEW series, Bunds rose from 129.37 to 129.41 - the peak for the day. Demand for German debt remains tepid, with the 2yr Schatz demand sub-2x b/c.
• Gilts gapped higher by 38 ticks before climbing another two to a 92.32 peak, in reaction to the latest unemployment and wage data. If the move continues, resistance comes into view at 92.51, 92.56 and 92.95. Upside spurred in a dovish reaction to a report that showed a further deterioration in the labour market, as the unemployment rate ticked up to 5.2% and is just a tenth shy of the BoE's 5.3% peak forecast (a view that was increased in the February MPR). Furthermore, wage data showed a moderation from the prior for both metrics and markedly so for the measure incl. bonuses. Sparking a dovish reaction in BoE pricing, however, the next cut remains priced for April, but March is now up to -21bps (-20.3bps pre-release) while the timing for a second 2026 cut has been brought forward to November from December.
• JGBs firmer, with upside of just over 50 ticks at best, hitting a 132.60 peak. Upside was a function of the negative risk tone in Japan overnight, where conditions were very limited due to numerous APAC closures. Furthermore, participants continue to digest the policy implications of recent weak GDP data. Note, there was fleeting JGB pressure to a broadly in-line 5yr auction.
• Germany sells EUR 4.59bln vs exp. EUR 6bln 2.10% 2028 Schatz: b/c 1.77x (prev. 2.1x), average yield 2.02% (prev. 2.14%), retention 23.5% (prev. 22.8%).
• UK sells GBP 500mln 0.125% 2028 Gilt via Tender: b/c 4.05x (prev. 3.77x), average yield 3.336% (prev. 3.443%), tail 0.7bps (prev. 0.6bps).
• Japan sold JPY 1.9tln 5yr JGBs; b/c 3.10x (prev. 3.08x), average yield 1.640% (prev. 1.639%).

Commodities

• WTI Mar'26 and Brent Apr'26 are trading around the lower range of USD 62.84-63.87/bbl and USD 67.85-68.62/bbl, respectively. Focus for oil traders is on meetings between the US and Iran and the trilateral talks between Russia, US and Ukraine. At the time of writing, the trilateral talks have concluded, with talks set to resume tomorrow. Much of the action this morning has been spurred by Iran-related commentary; some pressure in the complex on reports that Iran approved IAEA visit to nuclear facilities, but soon reversed after hawkish commentary from Iranian Supreme Leader Khamenei, who suggested that the US army needs to be "slapped" so hard it cannot get up. Most recently, reports suggest that Iran announced its readiness to reduce uranium enrichment, and are now at the stage of discussing technical issues. Ultimately, very choppy action given the mixed newsflow.
• Precious metals have stalled following prior day gains, with the yellow metal slipping below the USD 5,000/oz mark and silver falling by 4.5%, though off worst levels seen during the APAC session. Analysts note that liquidity remains thin, particularly across metals. Focus now turns to US ADP employment figures, which could trigger volatility. Weaker jobs data could trigger a weaker USD, spurring the yellow metal and vice versa.
• Copper prices remain subdued, largely amid the mixed global risk tone and the closure of the Chinese market due to the Chinese holiday. 3M LME Copper currently trades in a narrow range of USD 12,695.08-12,849k/t.

Geopolitics: Ukraine

• Russia's Kremlin said the three-way talk with US and Ukraine in Geneva will continue tomorrow with no news expected today.
• Russian Defence Ministry said Russia carried out a massive strike on military targets in Ukraine, IFX reported.
• Russian President Putin advisor Patrushev said Russia is preparing measures to respond to seizures of its trading vessels, IFX reported.
• Ukrainian long-range drones hit the Ilsky Oil Refinery in the Krasnodar Krai region of Russia and the refinery is on fire, according to Visegrad 24.

Geopolitics: Middle East

• Iran is ready to stay for days and weeks in Geneva in order to reach an agreement, Al Jazeera reports citing the Iranian Foreign Ministry spokesman.
• US-Iran nuclear negotiations in Geneva have entered the stage of discussing technical issues, Al Jazeera reports citing Iranian TV.
• Iran announced its readiness to reduce uranium enrichment, Al Hadath reports citing Iran's ambassador in Cairo; adds "The contradiction of the US statements is proof of its lack of seriousness in the negotiations."
• Iran's IRGC are holding military exercises in the Strait of Hormuz and the Sea of Oman at the same time as US-Iran nuclear talks, Iran International reports.
• Iranian Supreme Leader Khamenei says, in relation to the US, "The strongest army in the world may sometimes be slapped so hard that it cannot get up."
• Indirect talks between the US and Iran have begun with a message exchange process, according to reported.
• Senior Iranian Official said Iran's approach to US talks are positive and serious, but holds no preconception about the outcome.
• "Iran approves IAEA visit to nuclear facilities", Al Arabiya reported.
• Russian President's Aide said Russia, Iran and China sent ships to the Strait of Hormuz to participate in the "Security Belt 2026" exercise, Al Jazeera reported (as expected).
• US officials say they expect Iran to come to Geneva talks today with concrete concessions regarding its nuclear program, according to Axios.
• US President Trump said he will be involved in the Iran talks indirectly and that Iran wants to make a deal. Iran are bad negotiators and he hopes they will be more reasonable in talks.
• US delegation led by Special Envoy Witkoff leaves for Geneva for talks with Iran.
• Palestinian media reported Israeli army conducts bombing operations in deployment areas within Beit Lahiyah and the Northern Gaza Strip, according to Al Qahera.

Geopolitics: Others

• US President Trump said Secretary of State Rubio is talking to Cuba right now and that they want to make a deal, adds will see how it all turns out with Cuba and the US talking.

US Event Calendar

• 8:30 am: Feb Empire Manufacturing, est. 6.2, prior 7.7
• 10:00 am: Feb NAHB Housing Market Index, est. 38, prior 37
• 12:45 pm: Fed’s Barr Speaks on AI and the Labor Market
• 2:30 pm: Fed’s Daly Speaks on AI and the Economy

DB's Jim Reid concludes the overnight wrap

Without wanting to put you off reading any further, this may be the most boring EMR of the year so far, as yesterday was unusually calm compared with the pace of events so far in 2026. However there were a couple of new big AI disruption stories in the European session to report of below. But it was quiet due to the combination of the US holiday and the Lunar New Year in China, offering markets a chance to pause, and the subdued volumes suggested many participants took the opportunity to have a lie down... or watch the Curling or Ski Jumping. Chinese markets remain closed until next Tuesday, with Hong Kong set to reopen on Friday and Korea on Thursday. US markets reopen today, and S&P (-0.58%) and Nasdaq (-0.96%) futures are both trading lower after having edged higher for most of yesterday's session. 10yr Treasury yields (-2.5bps) are also creeping lower again, trading at 4.025% this morning. After last week’s sizeable rally in US yields, attention is firmly on the bond market as investors look ahead to Friday’s core PCE and Q4 GDP releases. Today starts the US data week quietly, with the February NY Fed Empire State Survey (+0.5 expected) and the NAHB Housing Market Index (37 expected) due.
The rates rally is spreading across Asia with 10-30yr JGBs -6 to -10bps lower as I type after a slightly better than expected 5 year auction. The Nikkei is down -0.92%, continuing its decline from the previous session helped by disappointing GDP figures for the fourth quarter.

Meanwhile, the S&P/ASX 200 is experiencing a slight increase of +0.26%, primarily supported by gains from the mining giant BHP Group (+4.75%), which reported robust earnings for the first half of the fiscal year. That's one company AI will struggle to disrupt, although as an aside I just asked our AI tool if it could be disrupted and the one way is if AI allows exploration and discovery to get faster and cheaper for challengers! Is nothing safe! However this is probably also a case where the company could also use such analysis.

Regarding central bank developments, the minutes from the Reserve Bank of Australia’s most recent monetary policy meeting indicated that the rate increase was prompted by stronger-than-anticipated data, ongoing widespread inflation, and relaxed financial conditions. Nevertheless, the central bank expressed uncertainty about the future trajectory of inflation and the economy, resulting in a lack of a “high degree of confidence in any particular path for the cash rate.”

With the US out yesterday, European markets were similarly subdued. Equities saw only modest moves, with the STOXX 600 (+0.13%) and FTSE 100 (+0.26%) finishing slightly higher even with a dip into the close. But beneath the surface, AI related concerns continued to simmer. In Germany, Siemens fell sharply (-6.41%) amid growing worries that industrial software could be another area exposed to AI disruption. That decline weighed on the DAX, which closed -0.46%. Likewise, France’s Dassault Systèmes slumped (-10.44%) on similar concerns, although the CAC 40 (+0.06%) still managed a marginal gain. It’s clear that the market hasn’t yet shaken off this theme.

Across Europe, the news flow remained light as EU leaders returned from the Munich Security Conference. Reports from the FT and Bloomberg suggested the UK is considering increasing defence spending to 3% of GDP by 2029—something that was largely expected, given the concessions needed to secure improved access to SAFE (Security Action for Europe) and more favourable EU trade terms. With no formal announcements likely before the Autumn Budget, investors appeared unbothered by any perceived fiscal implications. Gilt yields edged lower, with the 2yr down -0.7bps and the 10yr down -1.6bps. Elsewhere in fixed income, front-end European yields drifted slightly higher as renewed concerns over oil-driven inflation returned. The 2yr bund was up +0.2bps, while moves along the curve were more uneven, leaving the 10yr bund marginally lower at -0.1bps.

Oil prices rose as geopolitical tensions in the Middle East resurfaced, including reports that Iran’s Revolutionary Guard had begun military exercises in the Strait of Hormuz. Brent crude moved higher on the headlines, adding +1.33% yesterday. However it's down around -0.6% this morning. Markets will keep a close eye on developments as US–Iran talks are scheduled to resume today. Despite the renewed tensions, gold prices slipped yesterday, falling -0.74%. It is another -2% lower this morning with silver over -3% down, now trading $7 below its real adjusted price in 1790!

Looking to the day ahead, data releases include the US February Empire Manufacturing Index, the NAHB Housing Market Index, UK December average weekly earnings and unemployment, Germany’s February ZEW survey, the Eurozone ZEW survey, and Canada’s January CPI. Fed speakers include Barr and Daly, while today’s notable earnings releases feature Medtronic and Cadence Design Systems.

Tyler Durden Tue, 02/17/2026 - 08:39

When Cash Disappears, So Does Something Else

Authored by Mollie Engelhart via The Epoch Times,

Last Sunday, I held a book signing at Pearl in San Antonio, the kind of place magazines love to feature. Old brick buildings have been transformed into beautiful restaurants, boutiques, apartments, and bookstores. It feels curated yet charming, historic yet modern, a vision of how we’re told that cities should look and feel.

My signing happened during the farmers market, so there was music in the air, families strolling, dogs on leashes, linen dresses, and heirloom tomatoes. It was lovely. Before I sat down, I stopped into the trendy grocery store nearby. Everything inside looked like how food should look: thoughtfully sourced, artfully displayed, and priced closer to what real food actually costs when someone grows it with care. I ordered a coffee and a pastry and pulled a $20 bill from my wallet.

“We don’t take cash,” the cashier said politely.

I nodded. I’ve worked in restaurants, and I understand the argument. With employees, cash can be seen as a liability, with risks of theft, accounting errors, and end-of-day discrepancies. Cards feel cleaner, easier, and more trackable. Still, something in me tightened. Every time we stop accepting cash, we normalize a world where every transaction is recorded, categorized, stored, and potentially scrutinized. Every purchase becomes a data point. Every cup of coffee leaves a digital trail.

I took my coffee, found my seat at the bookstore, and started signing books. Between conversations, I could hear the sizzle and chatter from a nearby empanada booth at the farmers market. The smell of warm pastry finally got me. I walked over, cash already in hand.

“Can I get a potato empanada?” I asked.

The woman at the booth said, with an apologetic smile, “We don’t take cash.”

Not a brick-and-mortar store with layers of management, a pop-up tent at a farmers market. That’s when it really hit me. This isn’t just about convenience or speed at checkout. Cash itself is becoming strange, inconvenient, outdated, and almost suspicious. We’re being trained to accept that every exchange must be mediated, approved, and recorded by a third party, and that third party isn’t free.

Most of the vendors there were using Square to process payments. The typical fee is about 3 percent to 4 percent per transaction. That might not sound like much, but that percentage is shaved off every single time money changes hands digitally.

If I hand $20 in cash to the empanada vendor, and he hands that same $20 to the barber who cuts his hair, and the barber gives it to a babysitter, and the babysitter uses it to buy a pizza, that same $20 bill keeps moving through the community at full value. No one skims anything off the top.

But in the digital system, that cut happens again and again, and the effect compounds. At a 3.5 percent fee, after one transaction, that $20 becomes $19.30. After two, $18.62. After three, $17.97. After four, $17.34. After five digital transactions, only about $16.74 remains in circulation. More than $3 of the original $20 has quietly disappeared in just a handful of everyday exchanges. That money didn’t go to the farmer, the barber, the babysitter, or the pizza shop. It left the community entirely.

It’s a quiet drain on small communities, a friction we barely see because it’s spread out, invisible, and normalized. There’s also a common belief that businesses are required to accept cash because it’s legal tender. The truth is more complicated. In most places, private businesses can choose what forms of payment they accept unless a local or state law says otherwise. So no, they aren’t necessarily breaking the law. But legality and wisdom are not the same thing.

Every digital transaction comes with processing fees and interchange costs. Small businesses quietly lose a percentage of every sale, and customers pay more over time as those costs are baked into prices. In return, we give up privacy, independence, and the simple resilience of being able to transact even when systems go down. Cash works during power outages. Cash works when the internet is down. Cash works without a corporate intermediary. Cash is anonymous, direct, and final.

When everything becomes digital, spending can be tracked, restricted, frozen, or flagged. We may not feel that pressure today when we’re buying coffee and pastries in beautiful spaces, but systems built for convenience can easily become systems of control.

What struck me most that morning was the irony. I was at a farmers market, a place that represents local food, small producers, and community resilience, and yet even there, we’ve accepted the idea that every transaction must flow through the same centralized financial rails. We tell ourselves that it’s about ease, but what we’re really trading is privacy, resilience, and a small but meaningful piece of our sovereignty over how we spend the fruits of our labor.

It happened so gradually that most of us didn’t even notice. Until one day you’re standing at a farmers market, cash in hand, and realize that the future has arrived quietly, and that it doesn’t include the simplest form of freedom we used to carry in our pockets.

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

Tyler Durden Tue, 02/17/2026 - 08:05

BHP's Copper Pivot Pays Off With Surprise Dividend Bump, Record-High Stock Price

Shares of BHP Group, the world's largest miner, jumped to a record high in Australia after it posted earnings at the top end of Wall Street expectations. The miner's pivot into copper, aided by a surging rally in industrial metals, offset softer conditions in its iron ore unit.

BHP chief executive Mike Henry reaffirmed to investors earlier on a call that the miner is pivoting toward "future-facing" metals. In other words, he explained that the world's largest miner's shift away from operations focused on serving China's steel mills has paid off, as copper has soared.

Henry said that acquisitions began to bear fruit, as did the improvements at Escondida, the world's largest mine, all of which were helped by a record surge in the price of the industrial metal used heavily for power grids and AI-related applications. 

"This is the result of our deliberate actions to grow our copper business," Henry told analysts, adding, "Now, BHP is, by design, a diversified miner rather than focused on a single commodity."

At the time of writing, iron ore futures on the Dalian Commodity Exchange were trading at depressed levels below $100 per ton, while copper on the London Metal Exchange was trading around $12,850 per ton.

BHP earnings highlights:

• Underlying attributable profit rose 22% to $6.2 billion for the six months to end December. Shares in Australia jumped as much as 7.6% to a record.

• Copper contributed more than half of the profit for the first time, motly because of higher copper prices and steady output. Copper division underlying EBITDA climbed 59% to $8 billion.

• Iron ore earnings edged 4% higher and still make up close to half of the total, though BHP is dealing with "tough" negotiations with China's state buyer, China Mineral Resources Group.

• The Jansen potash project in Canada remains on track for first production in the middle of next year, though first-phase capex has risen to $8.4 billion.

• On M&A: Recent gains include the 2023 purchase of OZ Minerals and the Vicuna joint venture with Lundin Mining. Attempts to buy Anglo American (and efforts around its tie-up with Teck Resources) were unsuccessful, so BHP is emphasizing organic growth and being more disciplined in deal-making.

• Reiterated its plan to unlock up to $10 billion through asset sales and other transactions. It announced a $4.3 billion long-term silver streaming agreement with Wheaton Precious Metals tied to byproduct silver from the Antamina mine in Peru (BHP owns 33.75%). It also recently sold a $2 billion stake in the power network supporting Pilbara operations.

• Declared an interim dividend set at 73 cents, equal to a 60% payout ratio

UBS analyst Dominic Ellis commented on BHP's earnings, indicating "BHP Surprises With Dividend Bump."

Ellis told clients:

BHP's EBITDA beat by 3% in the first half of its financial year while EPS beat by 4%, but the surprise was the 16% increase in the dividend, on a 60% payout versus the baseline of 50%. Net debt stood at $14.7 bn, at the midpoint of the guided range, capex in line and guidance unchanged. Group EBITDA from copper was 51%, more than half of EBITDA for the first time. The stock has been a funding short for specialists, and while shares are performing well on these resutls, feedback from clients recently has been on the disconnect between iron ore (down sharply, now below $100/t) and iron ore equity resilience. BHP's spot free cash flow yield is 3.5% this year versus Rio Tinto on 6.4%.

Reminder about the copper market:

• Copper's Breakout Is Built On Much More Than Fundamentals

• Copper Hits Record High; Goldman Warns A "Circular Melt-Up" Is Now Driving Global Market

Strong earnings and a copper-led pivot that's cushioning a softer iron ore business have rewarded shareholders with record-high share prices in Australia.

"In the last five years, the BHP CEO has set the business up with options," said Glyn Lawcock, head of metals and mining research at Barrenjoey Markets Pty in Sydney. "Clearly, growth to 2030 is really potash and iron ore, but you hit the start of the new decade, it's pretty much all copper."

Tyler Durden Tue, 02/17/2026 - 07:45

Asians More Optimistic Than Most For Their Countries' Future

A recent Ipsos survey of 25,000 people across 30 countries shows Asians are on average more optimistic for the future of their countries than people from the rest of the world.

When asked whether they believe things in their country are headed in the right direction or off on the wrong track, 82 percent of respondents in Singapore said they think the city-state is on the right path, the highest percentage of all the countries included in the survey.

In second position came Indonesia, where three quarter of respondents felt their country was headed in the right direction, followed by Malaysia (69 percent), India (62 percent) and South Korea (58 percent).

The first non-Asian country, Argentina, came in sixth position with 57 percent.

As Statista's Valentine Fourreau shows in the infographic below, all the Asian countries included in the survey scored higher than the 30-country average, which stood at 41 percent.

You will find more infographics at Statista

Amongst the least optimistic countries were France (10 percent), Peru (21 percent), Hungary (24 percent) and Great Britain (24 percent).

The survey, which focused on what worries people around the world, found that the most common worries across all 30 countries were crime and violence (mentioned by 32 percent of respondents), inflation (30 percent) and poverty and social inequalities/unemployment (both 28 percent).

Ipsos notes that severe flooding caused by Cyclone Ditwah in parts of Southeast Asia led to increased level of worry about climate change in the region.

Thailand's level of concern about climate change now stands at 26 percent, 11 percentage points higher than the year before.

Tyler Durden Tue, 02/17/2026 - 05:45

Asians More Optimistic Than Most For Their Countries' Future

A recent Ipsos survey of 25,000 people across 30 countries shows Asians are on average more optimistic for the future of their countries than people from the rest of the world.

When asked whether they believe things in their country are headed in the right direction or off on the wrong track, 82 percent of respondents in Singapore said they think the city-state is on the right path, the highest percentage of all the countries included in the survey.

In second position came Indonesia, where three quarter of respondents felt their country was headed in the right direction, followed by Malaysia (69 percent), India (62 percent) and South Korea (58 percent).

The first non-Asian country, Argentina, came in sixth position with 57 percent.

As Statista's Valentine Fourreau shows in the infographic below, all the Asian countries included in the survey scored higher than the 30-country average, which stood at 41 percent.

You will find more infographics at Statista

Amongst the least optimistic countries were France (10 percent), Peru (21 percent), Hungary (24 percent) and Great Britain (24 percent).

The survey, which focused on what worries people around the world, found that the most common worries across all 30 countries were crime and violence (mentioned by 32 percent of respondents), inflation (30 percent) and poverty and social inequalities/unemployment (both 28 percent).

Ipsos notes that severe flooding caused by Cyclone Ditwah in parts of Southeast Asia led to increased level of worry about climate change in the region.

Thailand's level of concern about climate change now stands at 26 percent, 11 percentage points higher than the year before.

Tyler Durden Tue, 02/17/2026 - 05:45

Germany's Climate Policy Has Moved From Politics To The Courts... And The Economy Is Paying The Price

Submitted by Thomas Kolbe

Germany is the political engine of the Green Deal, yet it continues to fall short of its own CO₂ reduction targets. Now Germany’s Federal Administrative Court in Leipzig has ordered the federal government to tighten its climate targets by the end of March. The ruling follows a lawsuit filed by the German Environmental Aid (Deutsche Umwelthilfe), aimed explicitly at increasing political pressure. Germany is tightening the screws on its own catastrophe.

Germany in 2026: the economy has entered its eighth consecutive year of industrial decline. Companies are shutting down, and hundreds of thousands of jobs have already been lost in the core sectors of the country’s former prosperity—chemicals, mechanical engineering, and above all the automotive industry.

Climate change has struck—or rather, the ideologically skewed and socially unprecedented self-destructive frenzy of German politics has begun to shred any remaining hope of a return to normal economic conditions.

The attempt to free the country from conventional energy sources such as oil, gas, and coal through a rapid transition to CO₂-free energy—politically and psychologically inflated into a moral crusade to “save the planet”—has failed.

Given the devastating competitive position of the German economy, which now pays energy prices roughly three times higher than competitors in reference locations such as France or the United States, any rational observer would urgently recommend consigning the entire transformation agenda to the dustbin of failed political hubris and collective delusion.

What remains is damage control: a rapid return to a market-based energy system, an end to destructive environmental and social experiments, and an unavoidable restructuring of the welfare state to reflect new economic realities. Germany is getting poorer, productivity is falling, and GDP per capita is declining—realities that even the federal government’s massive debt-financed spending programs can no longer conceal.

Yet Germany in 2026 is no ordinary country. Its political elite, supported by an affirming media ecosystem, has entrenched itself in a self-referential system of emissions-centered economic control—a system now reinforced by judicial authority.

In its ruling, the court mandated that the government sharpen its environmental targets. Under current conditions, a gap of at least 200 million tons of CO₂ would remain by 2045, which must now be eliminated across Germany’s entire economic structure.

Judges who effectively substitute political objectives for democratic deliberation are now setting the framework for Germany’s continued decline.

The lawsuit was brought by the German Environmental Aid—an organization already known for launching the first serious legal assault on Germany’s automotive industry during earlier battles over particulate emissions in city centers. The pressure on Germany is now coming from within: from a taxpayer-funded NGO complex that appears determined to politically delegitimize key industries, with the state apparatus firmly on its side.

According to Deutschlandfunk, a leaked draft from the SPD-led Environment Ministry outlines a new climate program aimed at achieving climate neutrality by 2045. Spanning more than 330 pages, it appears the government anticipated judicial escalation and preemptively prepared the groundwork for a revised climate law. Political conflict has been outsourced to the courts, to the relief of Berlin’s climate hardliners amid worsening economic conditions.

Among the core measures is the intensified “heat transition” in the building sector. The ministry proposes increasing subsidies for low-income households—up to 40 percent of costs—for heating replacements and heat pump installations. A generous solution for the climate-policy establishment, conveniently rolled out during an election season.

The leaked strategy signals a general increase in transformation pressure. No fundamentally new instruments are introduced; instead, property owners are placed under tighter time constraints to replace heating systems.

Climate policy and financial affordability are colliding ever more sharply. Amid a prolonged recession, the government is deliberately provoking social conflict while attempting to pacify it through ever-expanding subsidies.

Germany’s public debt, at roughly 65 percent of GDP, still appears moderate by European standards. In Berlin, this is interpreted as ample room to finance the transformation through rising debt while simultaneously increasing pressure on the private sector.

Environment Minister Carsten Schneider speaks optimistically of new “climate jobs.” The overall picture, however, increasingly resembles political farce. A state that secures public consent for its transformation agenda through debt, subsidies, and higher taxes acts obscenely and invites long-term economic damage.

Plans even include methane measurement programs for livestock, modeled after New Zealand—yet another blow to farmers. German emissions policy is entering a manic phase, blurring the line between real policy and political satire.

The subsidy machine continues to spin. The government plans to support 800,000 electric vehicles in the coming years. Credit resources remain abundant after Chancellor Friedrich Merz effectively neutralized the constitutional debt brake with the previous parliament. By 2040, electric vehicles are supposed to account for 70 percent of Germany’s car fleet—despite the absence of any credible plan for supplying the required electricity.

Artificial, technocratic necessity has replaced political debate. From the outset, it was clear that the supposed softening of the combustion-engine ban was mere political theater—a sedative for citizens gradually awakening to the scale of the green ideological disaster.

The energy sector faces further tightening. Dozens of reserve gas power plants are to be added, while existing plants are to be converted to hydrogen capability. Offshore wind projects abroad are being accelerated. These measures amount to desperate rescue attempts for a failed energy transition—an assessment implicitly acknowledged even by the Environment Ministry itself. Model-driven hope has replaced rational judgment.

Germany’s climate policy, entangled in a feedback loop with Brussels, has ossified into an auto-referential system marked by a narrow temporal vision and growing argumentative poverty. Looming over it all is the threat of further litigation by the German Environmental Aid should the final legislation fail to meet its standards.

Germany now finds itself in the grip of green ideologues who have subordinated all parties behind an ideological firewall. The environmental lobby’s greatest success came when it elevated the Net Zero target to constitutional status.

How much greater must the economic pressure become before a majority forms—even in front of this firewall—to dismantle this manifest political folly?

* * * 

About the author: Thomas Kolbe, a German graduate economist, has worked for over 25 years 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 Tue, 02/17/2026 - 05:00

Germany's Climate Policy Has Moved From Politics To The Courts... And The Economy Is Paying The Price

Submitted by Thomas Kolbe

Germany is the political engine of the Green Deal, yet it continues to fall short of its own CO₂ reduction targets. Now Germany’s Federal Administrative Court in Leipzig has ordered the federal government to tighten its climate targets by the end of March. The ruling follows a lawsuit filed by the German Environmental Aid (Deutsche Umwelthilfe), aimed explicitly at increasing political pressure. Germany is tightening the screws on its own catastrophe.

Germany in 2026: the economy has entered its eighth consecutive year of industrial decline. Companies are shutting down, and hundreds of thousands of jobs have already been lost in the core sectors of the country’s former prosperity—chemicals, mechanical engineering, and above all the automotive industry.

Climate change has struck—or rather, the ideologically skewed and socially unprecedented self-destructive frenzy of German politics has begun to shred any remaining hope of a return to normal economic conditions.

The attempt to free the country from conventional energy sources such as oil, gas, and coal through a rapid transition to CO₂-free energy—politically and psychologically inflated into a moral crusade to “save the planet”—has failed.

Given the devastating competitive position of the German economy, which now pays energy prices roughly three times higher than competitors in reference locations such as France or the United States, any rational observer would urgently recommend consigning the entire transformation agenda to the dustbin of failed political hubris and collective delusion.

What remains is damage control: a rapid return to a market-based energy system, an end to destructive environmental and social experiments, and an unavoidable restructuring of the welfare state to reflect new economic realities. Germany is getting poorer, productivity is falling, and GDP per capita is declining—realities that even the federal government’s massive debt-financed spending programs can no longer conceal.

Yet Germany in 2026 is no ordinary country. Its political elite, supported by an affirming media ecosystem, has entrenched itself in a self-referential system of emissions-centered economic control—a system now reinforced by judicial authority.

In its ruling, the court mandated that the government sharpen its environmental targets. Under current conditions, a gap of at least 200 million tons of CO₂ would remain by 2045, which must now be eliminated across Germany’s entire economic structure.

Judges who effectively substitute political objectives for democratic deliberation are now setting the framework for Germany’s continued decline.

The lawsuit was brought by the German Environmental Aid—an organization already known for launching the first serious legal assault on Germany’s automotive industry during earlier battles over particulate emissions in city centers. The pressure on Germany is now coming from within: from a taxpayer-funded NGO complex that appears determined to politically delegitimize key industries, with the state apparatus firmly on its side.

According to Deutschlandfunk, a leaked draft from the SPD-led Environment Ministry outlines a new climate program aimed at achieving climate neutrality by 2045. Spanning more than 330 pages, it appears the government anticipated judicial escalation and preemptively prepared the groundwork for a revised climate law. Political conflict has been outsourced to the courts, to the relief of Berlin’s climate hardliners amid worsening economic conditions.

Among the core measures is the intensified “heat transition” in the building sector. The ministry proposes increasing subsidies for low-income households—up to 40 percent of costs—for heating replacements and heat pump installations. A generous solution for the climate-policy establishment, conveniently rolled out during an election season.

The leaked strategy signals a general increase in transformation pressure. No fundamentally new instruments are introduced; instead, property owners are placed under tighter time constraints to replace heating systems.

Climate policy and financial affordability are colliding ever more sharply. Amid a prolonged recession, the government is deliberately provoking social conflict while attempting to pacify it through ever-expanding subsidies.

Germany’s public debt, at roughly 65 percent of GDP, still appears moderate by European standards. In Berlin, this is interpreted as ample room to finance the transformation through rising debt while simultaneously increasing pressure on the private sector.

Environment Minister Carsten Schneider speaks optimistically of new “climate jobs.” The overall picture, however, increasingly resembles political farce. A state that secures public consent for its transformation agenda through debt, subsidies, and higher taxes acts obscenely and invites long-term economic damage.

Plans even include methane measurement programs for livestock, modeled after New Zealand—yet another blow to farmers. German emissions policy is entering a manic phase, blurring the line between real policy and political satire.

The subsidy machine continues to spin. The government plans to support 800,000 electric vehicles in the coming years. Credit resources remain abundant after Chancellor Friedrich Merz effectively neutralized the constitutional debt brake with the previous parliament. By 2040, electric vehicles are supposed to account for 70 percent of Germany’s car fleet—despite the absence of any credible plan for supplying the required electricity.

Artificial, technocratic necessity has replaced political debate. From the outset, it was clear that the supposed softening of the combustion-engine ban was mere political theater—a sedative for citizens gradually awakening to the scale of the green ideological disaster.

The energy sector faces further tightening. Dozens of reserve gas power plants are to be added, while existing plants are to be converted to hydrogen capability. Offshore wind projects abroad are being accelerated. These measures amount to desperate rescue attempts for a failed energy transition—an assessment implicitly acknowledged even by the Environment Ministry itself. Model-driven hope has replaced rational judgment.

Germany’s climate policy, entangled in a feedback loop with Brussels, has ossified into an auto-referential system marked by a narrow temporal vision and growing argumentative poverty. Looming over it all is the threat of further litigation by the German Environmental Aid should the final legislation fail to meet its standards.

Germany now finds itself in the grip of green ideologues who have subordinated all parties behind an ideological firewall. The environmental lobby’s greatest success came when it elevated the Net Zero target to constitutional status.

How much greater must the economic pressure become before a majority forms—even in front of this firewall—to dismantle this manifest political folly?

* * * 

About the author: Thomas Kolbe, a German graduate economist, has worked for over 25 years 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 Tue, 02/17/2026 - 05:00

EU Prepares €4 Trillion Eurobond Push As Russia Eyes Dollar Comeback

Submitted by Thomas Kolbe

The European Union is steering purposefully toward the introduction of Eurobonds. At the preparatory EU summit at Alden Biesen Castle in Belgium, numerous signs suggest that the multi-billion-euro Draghi plan could soon be set in motion. At the same time, geopolitically, a possible Russian comeback is emerging as fresh trouble for Brussels.

The ability to analyze mistakes and rationally weigh realistic courses of action belongs, in evolutionary terms, to our conditio humana. Experience teaches us: those who repeatedly slam their heads against the same wall may not qualify as evolution’s preferred leadership model. Headaches should be understood as a warning sign — not as motivation for the next assault. This preliminary remark serves to highlight a fundamental problem in present-day Europe.

Our political elites are conducting a socialist field experiment: they repeatedly hurl themselves against the same wall — that of the European economy, its businesses, and some 450 million citizens — without allowing persistent failure or pounding headaches to deter them.

One might assume this is a highly complex structure. From the perspective of European policymakers, however, it appears primarily as a challenge to be met with the fatal toolkit of central planning and stubborn ignorance.

We were able to assess the condition of this collective “head” on Thursday in Belgium at the EU summit. Brussels’ inner leadership circle around Commission President Ursula von der Leyen, along with its two political standard-bearers Emmanuel Macron and Friedrich Merz, had correctly diagnosed the issue in advance: the EU economy lacks competitiveness. China and the United States have surged ahead technologically — and they have the audacity to position themselves diametrically opposed to Europe’s ideology of centralized control and transformation logic. The two superpowers flatly refuse to smash their heads against the wall of European delusions — CO₂ elsewhere helps plants grow and herds graze, while here “flutter power” is generated alongside deliberate landscape devastation.

Instead, they have moved to radically deregulate their markets. The Chinese did so earlier; the Americans are now following at full speed, embracing what appears evolutionarily sound: entrusting the social fabric of their societies once again to markets, individuals, and the principle of personal responsibility.

Meritocratic values, a revival of bourgeois culture, perhaps even religion — Europe wants none of it. Everything here remains woke, carefully curated by the supreme censor in Brussels. On the very day of the summit, the European Parliament declared that a trans woman is a woman — full stop.

So much for the “rules-based order” and European values. An order that could be grounded in many things — but apparently not in reason and biological reality. Europe postures as post-Enlightenment, beyond the bounds of common sense.

Back to the summit and the question of how to solve the Eurozone’s economic dilemma. An old acquaintance, former Italian prime minister and ex-ECB chief Mario Draghi, delivered the blueprint for a supposed European comeback two years ago — and may now define the EU’s framework for action.

To deflate the suspense: Europe’s debt club will likely choose the same old wall for its next act, once again demonstrating its skeptical stance toward cognitive progress. If Brussels resorts to the Draghi plan in its economic distress, a trillion-euro debt package would be activated — public credit designed to catapult the continent in green tech, artificial intelligence, digital infrastructure, and even military technology to the level of its geopolitical rivals by 2030. Hubris executed on the bond market.

The financial framework outlined by Draghi is enormous: over five years, €800 billion annually would flow into Eurobonds — unless a few reasonable politicians manage to halt this risky undertaking. €800 billion corresponds to roughly five percent of the EU’s GDP. This additional borrowing alone would, under current conditions, raise member states’ total debt by around 25 percent.

A fiscal gamble whose test phase already occurred during the issuance of NextGenerationEU bonds in the Covid era — at nearly identical volume. €750 billion was raised, and in the end the European Central Bank had to absorb much of it. Demand for European debt appears lukewarm; the money has since flowed into Southern European welfare budgets and selected green prestige projects.

Brussels must literally plant its political beacons across the landscape so that even the last EU citizen remembers who transformed cultural scenery into a kind of Hollywood dystopia filled with wind parks.

You will recall Mario Draghi: once Italy’s technocratic — that is, unelected — prime minister, and earlier the architect of the OMT program (Outright Monetary Transactions), the instrument that empowered the ECB during the 2012 debt crisis to purchase unlimited sovereign bonds of distressed euro states to regulate yields. “Whatever it takes,” declared Mr. Bombastic Draghi at the time — and now his heavy fiscal artillery may once again fire at problems whose causes lie less in the monetary sphere than in the microeconomic fabric and cultural climate of our societies.

These difficulties will not be solved through debt-financed state macro-management. What is missing is entrepreneurial spirit. The continent is overregulated, capital markets are impaired, and Europe’s ever-growing state apparatus consumes vast sums. The private sector struggles to develop viable business models while administrative burdens and fiscal appetites continue to expand.

The self-inflicted energy crisis born of the green transformation frenzy is only one of several nooses tightening around EU citizens’ necks. An even more bloated state apparatus would not loosen these nooses — it would tighten them. Of that there can be no doubt.

For Germany, the simultaneous introduction of Eurobonds alongside the Draghi maneuver would mark the end of any remaining hope for fiscal stability. The current government’s chosen path would drive public debt up by at least five percent annually. Adding Germany’s proportional share of newly issued euro debt, one can already foresee that by 2030 Germany could easily breach 110 percent debt-to-GDP.

In other words: the welfare state would henceforth be financed directly from the printing press.

Chancellor Friedrich Merz demonstratively enjoyed summit unity with French President Emmanuel Macron. As so often, they agreed on the decisive questions, Merz explained, sharing a sense of urgency: Europe must act now and become competitive again — especially in industry.

Precisely the sector most heavily damaged by the very policies now overseen by the chancellor: higher CO₂ levies, supply-chain legislation, and an energy policy that levels industrial ambition.

In the end, it was the usual summit folklore — nothing more.

A “Buy European” rule is meant to guide the way, with supply chains to be more firmly centered in Europe. One may wonder how this resource-poor continent intends to achieve such ambitions. Especially in international trade and in Russia policy — precisely where abundant and affordable resources would be available — Europe has largely abandoned sober assessment. Toward its declared arch-enemy Russia, one of the most resource-rich nations on earth, Europe remains locked in maximal defiance.

The pre-summit ahead of the March gathering offers initial hints that joint debt financing may indeed become serious. Italy’s Prime Minister Giorgia Meloni — facing debt around 130 percent of GDP in the homeland of joint borrowing — may find the idea of shared liability, particularly by the German taxpayer, not entirely unappealing.

While Brussels dances around the golden calf of the transformation agenda and attempts to buy time with massive debt programs and well-sounding pseudo-reforms, decisive developments may unfold behind the scenes.

According to an internal Kremlin memo seen by Bloomberg, Russia is reportedly considering a return to the US dollar payment system. After years of European sanctions, American embargoes, and exclusion from SWIFT, such a move would be a geopolitical shock of the first order — further isolating the European Union while potentially fueling secessionist tendencies, particularly in Eastern Europe.

The memo outlines several areas of overlapping Russian-American interests: energy and raw materials cooperation, as well as possible integration of dollar-based financial instruments into Russia’s banking system. Reuters has confirmed a corresponding contact channel between Washington and Moscow.

Against the backdrop of increasingly coordinated activity among the three major actors — the United States, China, and Russia — Brussels’ strategy appears in a different light. Perhaps this explains its efforts to seek strategic partnerships with classic geopolitical swing states such as India or the MERCOSUR bloc.

For one thing unites the three great powers: all stand in increasingly strained relations with Brussels and the leading capitals of the European Union.

* * * 

About the author: Thomas Kolbe, a German graduate economist, has worked for over 25 years 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 Tue, 02/17/2026 - 02:00

Voyages To The End Of The World: The Moral Costs Of Techno-Utopianism

In their highly read First Things essay “Voyages to the End of the World,” Peter Thiel and Sam Wolfe use Francis Bacon’s utopian “New Atlantis” to argue that modern faith in unlimited technological progress has subtly redefined salvation as a human-controlled achievement rather than a divine gift, displacing religious understandings of human destiny with promises of security, abundance, and mastery over nature.

They warn that this Baconian project - disguised in Christian imagery - risks creating a seductive but spiritually impoverished civilization where technological power outpaces moral wisdom, potentially leading to an end-times trajectory of false salvation unless reintegrated into a framework that respects natural and spiritual limits.

Authored by William Brooks via The Epoch Times,

Founded in 1990 by the late Fr. Richard John Neuhaus, First Things magazine strives to promote a well-informed public philosophy in the Christian and Jewish traditions.

Last year, one of the most read essays in First Things was titled: “Voyages to the End of the World” by Peter Thiel and Sam Wolfe. Thiel is a tech entrepreneur, investor, and author. Wolfe is a writer and researcher at Thiel Capital.

These thinkers offer a probing examination of our modern technological ambitions. Using Francis Bacon’s unfinished 17th-century work “New Atlantis” as a point of departure, Thiel and Wolfe suggest that modern faith in scientific progress is corroding the religious understanding of human destiny. They contend that Bacon’s utopian tale about knowledge and prosperity contains a warning about the moral costs of unlimited technological mastery.

Thiel and Wolfe’s central claim is not that science itself is evil or that technological progress must be rejected. Rather, they argue that Bacon’s scientific project—and the modern world that has adopted it—rests on a redefinition of salvation. Whereas Christianity views redemption as a divine process that transcends history, Bacon relocates it firmly within human control. In doing so, modern technological civilization risks mistaking power for wisdom. This could have grave consequences as we enter an epoch defined by unprecedented technological advancement.

At the heart of their essay is a close look at Bacon’s fictional account of the island society of Bensalem. On its surface, Bensalem appears harmonious, pious, and benevolent. Its inhabitants are devout, orderly, and humane; its institutions promise healing, abundance, and stability. Its governing institution, Salomon’s House, is dedicated to the systematic investigation of nature for the “relief of man’s estate.” Bacon presents scientific inquiry as a quasi-religious vocation, cloaked in Christian imagery and moral restraint.

Thiel and Wolfe warn that this superficial harmony conceals a radical transformation of the human relationship to nature, knowledge, and God. They argue that Bacon’s true ambition was not merely to advance science but to replace the classical-Christian understanding of limits with a project of total technological mastery. Knowledge, in Bacon’s vision, is not ordered toward moral formation but toward domination and control. Nature is no longer something to be understood within an inherited moral order; it is something that can be conquered and redesigned.

This shift has profound implications. Bacon’s scientific method implicitly promises what religion once offered: security, healing, abundance, and even a form of immortality. By embedding these promises within a framework that appears Christian, Bacon disguised the degree to which his vision subtly marginalized the hand of God. In New Atlantis, God remains present, but increasingly as a symbolic guarantor of human progress rather than as the ultimate judge of human action.

Thiel and Wolfe interpret this displacement through an eschatological lens. Drawing on biblical imagery, they suggest that Bacon’s utopia resembles the deceptive peace promised in apocalyptic literature—a peace achieved not through repentance or divine reconciliation, but through human ingenuity and centralised power. The danger is not tyranny in its crudest form, but something more seductive: a world so efficient and secure that it no longer recognizes its spiritual impoverishment.

One of the essay’s most troubling conclusions is that modern technological civilization may be better understood as an end-times trajectory rather than a benign accumulation of new tools. Scientific progress does not merely extend human capacities; it reshapes human expectations about the future. When technology promises to eliminate scarcity, suffering, and even death, it inevitably assumes the role once played by theology. In this sense, modernity reconfigures the religious impulse by substituting technique for grace.

The authors argue that this substitution is inherently unstable. Technological power expands far more rapidly than moral wisdom, and the belief that every problem has a technical solution blinds societies to questions of meaning, responsibility, and restraint. The more humanity relies on systems it only partially understands—artificial intelligence, biotechnology, etc.—the more it risks becoming subject to forces it can neither fully control nor morally justify.

A further conclusion concerns the cultural conditions that allow this dynamic to persist. Thiel and Wolfe suggest that widespread biblical and philosophical illiteracy leaves contemporary society unable to recognize the spiritual dimensions of technological ambition. Apocalyptic language, once central to the Western moral imagination, is now dismissed as superstition.

Yet without such language, we lose a critical framework for discerning the difference between genuine progress and false salvation. The result is not rational clarity, but naivete—a readiness to accept sweeping promises of safety and efficiency without asking what is being sacrificed in return.

The relevance of “Voyages to the End of the World” becomes especially clear as we move deeper into the 21st century. Humanity now possesses technologies capable of reshaping life itself, from genetic engineering to autonomous systems that make decisions once reserved for human judgment. Political and economic leaders increasingly speak in utopian terms, promising that innovation will solve social conflict, environmental degradation, and even moral disagreement. These assurances echo Bacon’s vision of a world governed by knowledge rather than virtue, technique rather than tradition.

Thiel and Wolfe suggest we correct our course. They invite readers to reconsider whether the goals of technological civilization are as harmless as they appear. The question is no longer whether we can build more powerful tools, but whether those tools are shaping a conception of life that is ultimately compatible with human well-being.

The authors do not advocate withdrawal from modern life or a rejection of scientific inquiry. Their argument is one of discernment. Technological progress, they assert, must be reintegrated into a moral framework that acknowledges the natural limits of human power. Without such a framework, progress becomes self-justifying, and power becomes an end in itself. We are reminded that the future we build should not be merely technical. It should also be moral, spiritual, and ultimately related to the destiny of human souls.

As the second quarter of the 21st century unfolds, “Voyages to the End of the World” offers a timely caution.

The greatest danger facing technological civilization may not be catastrophe, but success—the achievement of a techno-managed world that no longer knows why or for what it exists.

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

Tyler Durden Mon, 02/16/2026 - 23:35

US Air Force Moves To Quickly Restock 30,000-Pound Bunker-Busters

With tensions between Washington and Tehran soaring, the US Air Force has moved to restock its GBU-57 Massive Ordnance Penetrator (MOP) bunker-buster bombs, which is the same weapons used in June during Operation Midnight Hammer, when several - some reports say over a dozen - were dropped on three Iranian nuclear facilities.

Along with the ongoing US military build-up in the US Central Command (CENTCOM) region of responsibility, this is another big sign that Trump-ordered military action could be imminent, despite that the Iranians have not attacked the United States or its bases abroad. On that, the below is where things stand in terms of deployments...

After the Gerald R. Ford Carrier Strike Group transits the Atlantic, the U.S. will have 2 aircraft carriers and 15 destroyers (plus a few subs) to work with across combatant commands.

Approx. 33% of the deployed U.S. Navy fleet is represented below, which can carry 600+ TLAMs. pic.twitter.com/1vPf9akqTY

— Ian Ellis (@ianellisjones) February 16, 2026

A partially redacted federal notice posted last week confirms the Air Force awarded Boeing a sole-source contract to replenish the depleted stockpile.

The Air Force stated the move was necessary because "this procurement and sustainment activity is critically needed to replenish the inventory of GBU-57’s, ended during Operation Midnight Hammer (21 June 25)."

The notice further explains the Pentagon bypassed a competitive bidding process because Boeing has "uniquely acquired expertise over a period of 18 years of adapting this specialized weapon to meet evolving mission needs as MOP transitioned from proof-of-concept to Full Operational Capability." Also, any alternate decision might have resulted in delays.

Boeing is the only manufacturer of the 30,000-pound GBU-57 MOP, the deep-penetration bomb designed to destroy hardened underground targets.

"No delay in award is acceptable for this effort. Delaying this requirement would undermine force readiness and efficient acquisitions for this key weapons program. A delay undermines Combatant Commanders’ capabilities, jeopardizes force readiness and strategic deterrence, hinders nuclear proliferation prevention efforts, and could result in loss of life," the notice stated.

That is one big bomb...

 US Air Force photo

One remaining key detail from the June war which has been shrouded in contradiction and ambiguity is whether the initial bunker busters really obliterated Iran's nuclear development capability. President Trump certainly claimed this several times soon after the fact, and yet now warns the Iranians against moving forward with their nuclear program.

Tyler Durden Mon, 02/16/2026 - 23:00

China's Debt Model Creates Danger Of Stagnation

Authored by Daniel Lacalle,

The latest social financing figures from China show an economy that is increasingly relying on government debt while private demand for credit remains weak. The strength of the Chinese technology sector and its exporting companies gives enough room for leverage. However, behind the weak private sector credit demand lies an evident economic slowdown that the Chinese government acknowledges, challenging consumption patterns, a significant overcapacity problem, and the depth of the housing crisis.

The current economic model, focused on delivering 5% real economic growth, requires larger doses of debt to achieve smaller increments of growth, especially productive sector growth. The government has focused on reducing debt and overcapacity imbalances while reorienting its exports and financial system to lessen dependence on the US dollar; however, the main challenge for the Chinese economy remains boosting consumer demand, despite rate cuts and easing financial conditions.

To understand the intensity of debt of the Chinese model, we must go to the year 2000 and see the acceleration in the flow of debt, not just the current stock. At that time, real GDP growth was around 8–9%, so each percentage point of growth came with roughly 13–16 points of debt‑to‑GDP. Government debt was very low, at around 25% of GDP, and most leverage sat in the state-owned corporate sector with modest household debt. China was able to deliver near‑double‑digit growth with a total non‑financial debt ratio barely above 120% of GDP.

By 2023, non‑financial sector debt had risen to about 285% of GDP, more than doubling its level of 2000. Chinese think‑tanks and official commentators put the “macro leverage ratio” closer to 300% of GDP by 2025, according to the Chinese Academy of Social Sciences. The macro leverage ratio rose by 11.8 percentage points to 302.3 percent in 2025, exceeding the 10.1-point increase reported in 2024.

Over the same period, the trend of real GDP growth has slowed to roughly 4–5%, so each percentage point of growth now requires around 60–75 points of debt‑to‑GDP, more than three times the debt per point of growth required in 2000. Furthermore, it comes mostly from government debt.

In January 2026, aggregate social financing jumped by 7.22 trillion yuan, significantly higher than in the same month of 2025 and above market expectations, consistent with 5% annual GDP growth and a larger composition of the public sector in the mix. Outstanding social financing reached 449.11 trillion yuan at the end of January, rising 8.2% year‑on‑year, while money supply (M2) rose by 9%.​

New yuan bank loans were 4.7 trillion yuan, about 420 billion less than a year earlier and significantly below consensus, showing the weak private‑sector credit demand and the prudent approach of Chinese customers and businesses to debt addition. RMB loans outstanding stood at 276.62 trillion yuan, up only 6.1% year‑on‑year, clearly below the pace of overall financing and money growth.

The driver of credit growth in China is no longer households and private firms but the government and state-owned companies.

The real estate problem has impacted Chinese families in numerous ways. Not only did most of them see the value of their homes decline, but many families invested in the attractive yields of real estate developers’ commercial paper, which led to large losses and even the wipe-out of savings for many. Additionally, despite the excess in supply of houses, prices have not fallen enough to warrant enough appetite for new mortgages, as affordability remains an issue and the traditional prudence of Chinese citizens when it comes to consuming and borrowing adds to the challenge.

Beijing plans to issue 4.4 trillion yuan in local government special‑purpose bonds in 2025, 500 billion more than in 2024, looking to boost government investment and a “proactive fiscal policy,” knowing that raising taxes would be exceedingly negative for growth and consumption.

Local governments are expected to issue more than 10 trillion yuan in bonds in 2025, including refinancing, general bonds, and new special bonds.

The Chinese government knows that it can manage more debt but also sees the weak investment and household spending and acknowledges that large tax increases would be counterproductive.  However, to prevent future debt-driven stagnation, a focus on productivity is necessary.

The official budget sets a deficit of 4% for 2025. However, once all budget items are consolidated, including government funds, special bonds, and off‑budget vehicles, this true fiscal deficit in 2025 is closer to 9%, up from 7.7% in 2024, according to Rhodium Group and JP Morgan. China increasingly relies on hidden or almost fiscal borrowing to support growth.

With outstanding social financing now around 449 trillion yuan and real growth around 4–5%, each incremental point of GDP is increasingly linked with a much larger stock of debt than a decade ago. This rising credit intensity of growth may prevent a significant slowdown but may create a significant fiscal challenge in the future. The Chinese model demands high growth and low taxes; any change to the fiscal system will be negative.

For years, local governments relied on the sale of land for property development to collect tax receipts. Thus, the drag from real estate is evident in the economy and in fiscal sustainability. Real estate development investment fell 13.9% year‑on‑year in the first three quarters of 2025, with residential investment down 12.9%, the steepest drop since 2021, according to official figures. Property investment and sales both posted double‑digit declines in 2024, and forecasters expect real estate investment to fall another 11% and sales to drop 7.5% in 2025, according to Reuters, with further declines in 2026 before stabilizing only in 2027… if it happens as fast as consensus estimates.

The property sector, once a key engine for economic growth and tax receipts, absorbs new credit to stabilize its accounts without boosting growth or creating a multiplier effect.

Additionally, China’s industrial capacity utilization remained at 74.9% at the end of 2025, well below the 78.4% peak reached in 2021. Overcapacity is clear in steel, autos, legacy chips, and parts of sectors like green tech, where expansion has surpassed domestic and external demand. Thus, the purchasing managers’ indices show weak new orders and foreign demand, while bankruptcies and insolvencies have risen, although not to levels that would indicate a financial crisis.​

The Chinese economy needs to reopen, improve investor and legal security and allow the housing slump to materialize fully to see the type of productive economic growth it needs to avoid much larger increases in debt. Otherwise, the risk of stagnation will likely be elevated as population growth stalls, overcapacity remains, and the stock of unsold property becomes a larger liability.  

Tyler Durden Mon, 02/16/2026 - 22:25