Meritocracy Vs. Credentialocracy

Authored by Steven Kritz via the Brownstone Institute,

It is generally acknowledged that the Baby Boom generation (of which I am a member) has been the most successful, socioeconomically speaking, in the history of this planet, and the prospects for the generations following to match or surpass us are not looking good. As a confirmation of the disparity, I recently read that while Baby Boomers make up approximately 20% of the current US population, they possess more than 50% of the wealth.    

In speaking with others of my generation, I have come to realize that very few Baby Boomers have even a modicum of insight as to how that success happened. The typical pabulum that I get from my peers is that they got their education and worked hard, implying that it should be no different for the younger generations. 

To be fair, I can see several historical and sociological factors that would lead Boomers to think this way. First of all, many of our parents pounded into our heads from an early age that going to college was the key to success. Some things just don’t change from generation to generation! In fact, when Boomers entered the work force en masse during the 1970s, we were the largest new worker cohort in the history of the country, and approximately 30% of us had a college degree, up from, at most, 10% for previous generations. 

However, despite our educational advantages, the 1970s was a disastrous time economically for everyone, but especially for those entering the workforce, and those permanently leaving the workforce, due to retirement or disability. We were plagued by two recessions, two huge oil shocks, and stagflation. Engineering as a career was absolutely dead. Add the extremely challenging geopolitical environment both at home and abroad, and we experienced an era when it was virtually impossible to get ahead solely through one’s education and hard work. 

I was able to sidestep much of this, at least socioeconomically speaking, even though my dad had suddenly and unexpectedly died at the age of 42 in mid-December 1969. That’s because I spent the first three years of the 1970s finishing college, the next four years in medical school, and the final three years of the decade as an Internal Medicine resident. In those days, the cost of living, including college and medical school could be handled without too much difficulty, and the pay as a medical resident was sufficient for me to have a very nice apartment in Brooklyn, while also being able to save some money. As such, I didn’t enter the “real” workforce until the middle of 1980. 

The timing for me was near perfect! Beginning in the middle of 1982, the greatest economic boom in history launched, and due to significant gains in the areas of racial equality and women’s rights, all groups participated. In fact, every quintile of household income set a record in all but two or three years of this boom, peaking in 1999. 

Given that the 1980s and 1990s were in the wheelhouse of every Baby Boomer’s working career, I could see where the attitude would be that getting an education and working hard would lead to success. Extrapolating this thinking to the younger generations, it would make sense for Boomers to believe that the younger generations, having an even higher percentage with a college degree, just need to keep working hard and they will also achieve the same level of success. However, there are several major flaws in this thought process. 

Some of it stems from the fact that the Boomers were the first “me” generation. It resulted in an inability to see the world from other than a personal bubble that was easily filled with nonsense. One of the things that has been completely missed by the Boomers is that Gen X, which is currently in its peak earnings years, has not, and never will catch up to the Boomers in terms of wealth accumulation. 

Carrying this train of thought further, one might ask the following questions: (1) Are Boomers smarter than the generations that followed? I’d say no, except for people born between 2005 and 2020, who were permanently damaged by the Covid response. The extent of the damage won’t be known for another decade or two, since that cohort has not entered the workforce as yet. (2) Did the Boomers work harder than the generations that followed? 

While every generation believes that the younger generations are overrun by lazy bastards, it’s not true. The reason for this misconception is that the tools available to each successive generation to help them work more effectively (and generate more wealth) evolve from generation to generation. 

In order to explain the success of the Boomers, one has to look at the economic environment within which each generation lived during its working lives. The wealth creation of the 1980s and 1990s was not because Boomers were so great; it was because we operated in an economic environment that was conducive to success at a level that had never been seen before. That economic environment can be described in one word: Reaganomics. 

Very recently, the word meritocracy has come back in vogue. What I can state with near certainty is that the era when meritocracy reached its zenith in this country was during the 1980s and 1990s, and it was largely due to an economic environment that promoted it. Since the end of the 20th century, those favorable conditions haven’t existed, other than during the years 2018 and 2019.

From the foregoing, it should be clear that most Boomers put the cart before the horse when it comes to explaining our generation’s success…and our children are paying a heavy price for this lack of insight. What has been particularly difficult for Millennials is that their childhood occurred during the greatest economic boom ever, only to enter the workforce beginning in 2000, when everything changed, and not for the better. 

Having not been taught the real reason why the Boomers succeeded, the younger generations do not understand (and actively resist) the efforts by the Trump administration to reestablish the economic environment of the 1980s and 1990s. The only taste of it occurred in 2018 and 2019, when household incomes in every quintile finally broke through the records previously set in 1999, but it was overshadowed by the Covid disaster, which distorted everything. 

As mentioned earlier, the term meritocracy has been resurrected, but what is really being put forward is credentialocracy. They are not the same. If they were, the younger generations would be doing just fine, socioeconomically speaking. We live in a country where having more initials after one’s name imputes greater intelligence, superior level of achievement, and higher ethical standing. More than anything, the disaster known as the Covid response taught us otherwise, in that the best and the brightest made everything much worse than it would have been had we done absolutely nothing. Unfortunately, this lesson has not penetrated most peoples’ personal bubble; at least not yet.

To make matters worse, our so-called educational system has cheapened the value of a credential, while charging higher and higher tuition to obtain it. In fact, our educational system rewards teachers, not for how well the students they teach perform, but by how many post-graduate credits and degrees the teacher obtains. 

To me, this credentialing madness reached the height of perversity and insanity when it became clear that the CDC’s recommendations for protecting children’s health with regard to school closings, social distancing, masking, and “vaccine” mandates were dictated to the head of the CDC, Rochelle Walensky (who has MD and MPH credentials) by Randi Weingarten, head of the largest teachers’ union (who has a JD credential). This is backwards, and tremendous damage has been done. Want more? Despite the fact that uptake of the Covid shots has dropped to around 5%, it is my observation that among the highly educated, uptake is several times higher. Are the best and the brightest in the process of self-immolation? 

Clearly, we need to decouple meritocracy from credentialocracy, and we must return to a state in which meritocracy can flourish. This will require unlearning the progressive garbage that’s replaced critical thinking over the past 55+ years, and an economic environment that fosters individual initiative. Otherwise, we’re done, and you might as well stick a fork in us now.

Steven Kritz, MD is a retired physician, who has been in the healthcare field for 50 years. He graduated from SUNY Downstate Medical School and completed IM Residency at Kings County Hospital. This was followed by almost 40 years of healthcare experience, including 19 years of direct patient care in a rural setting as a Board Certified Internist; 17 years of clinical research at a private-not-for-profit healthcare agency; and over 35 years of involvement in public health, and health systems infrastructure and administration activities. He retired 5 years ago, and became a member of the Institutional Review Board (IRB) at the agency where he had done clinical research, where he has been IRB Chair for the past 3 years.

Tyler Durden Fri, 01/09/2026 - 21:00

Venezuela's Methane Problem Looms Over Trump's Oil Revival Plan

President Trump’s push to revive Venezuela’s oil sector is colliding with a major technical obstacle: vast methane leaks from crumbling infrastructure that could scare off large international investors, according to Bloomberg.

Satellite monitoring shows huge plumes of methane rising from abandoned rigs, corroded pipelines and aging facilities across the country. Those emissions signal both lost revenue and deep operational problems — conditions that tend to deter major oil companies. As Clayton Nash of Tegre Corp. put it, “That’s one way that you’re going to know that you’ve got facilities that are not operated well.”

Each year Venezuela wastes about 13 billion cubic meters of natural gas through flaring, venting and leaks, roughly $1.4 billion in potential revenue. About a quarter of its total gas output escapes into the atmosphere — the highest rate globally and nearly ten times the world average. The scale of those leaks reflects decades of neglect, theft and underinvestment, leaving what remains of the system fragile and costly to repair.

Bloomberg writes that those realities complicate Trump’s effort to draw fresh capital. The White House is bringing U.S. oil executives to Washington on Friday to advance that plan, with the core message expected to be: “Do it for our country.” Yet analysts warn that political instability and Venezuela’s history of seizing foreign assets may keep major companies on the sidelines.

“We anticipate that large, publicly traded US and European majors will remain hesitant given their checkered history in the region,” said Quentin Peyle of Kayrros SA. “Instead, investment will likely come from smaller operators with a higher risk appetite.”

That shift carries its own risks. Smaller firms often lack the capital and incentives needed to modernize operations and control emissions at scale. Even if leaks are reduced, Deborah Gordon of RMI cautioned that “Venezuela’s fields will not only need an overhaul but also require careful operational management and oversight long into the future,” adding that the country’s extra-heavy crude would remain a major source of CO₂.

Restoring production near Venezuela’s former peak of almost 4 million barrels per day could require about $100 billion over the next decade. And the true condition of the infrastructure may remain hidden until output increases. As Nash warned, “You’re not going to find out how bad things are until you ramp up production.”

Tyler Durden Fri, 01/09/2026 - 20:30

Rian Howlett , Karen Friar and Ines Ferré of Yahoo Finance report Dow, S&P 500 jump to records, Nasdaq surges as stocks end 2026's first week with big gains: 

US stocks rose to all-time highs on Friday as investors assessed the December jobs report to end a jam-packed first full trading week of 2026.

The S&P 500 (^GSPC) gained 0.6%, notching a new record. The Dow Jones Industrial Average (^DJI) rose around 0.5% to also post an all-time high close. The Nasdaq Composite (^IXIC) jumped 0.8%, marking a winning week for all three major averages.

Markets on Friday were focused on two potential catalysts: the December jobs report and the chance of a decision from the Supreme Court on the legality of Trump's sweeping tariffs.

The nonfarm payrolls report, which returned to its normal cadence following disruptions from the government shutdown, showed the US added 50,000 jobs in December. Payroll growth fell short of economists' expectations of about 70,000 positions added, sealing bets that the Federal Reserve will stand pat on interest rates in less than three weeks.

The unemployment rate declined to 4.4%, from 4.6% in November, carrying 2025's labor market theme of a “no-hire, no-fire” economy through the end of the year.

Wall Street was also on alert for a tariffs ruling from the Supreme Court, which could carry huge implications for US economic strategy if the levies are found to be unlawful. Friday came and went without a decision. The court indicated its next opinion day would come Wednesday, Jan. 14.

Meanwhile, investors are weighing the latest developments in the US moves on Venezuela. Trump said he has canceled a second wave of attacks in the country, citing cooperation over US plans to rebuild its crumbling energy infrastructure. The White House has called a meeting with global oil majors on Friday to discuss the fate of Venezuela's huge reserves.

On the home front, Trump said he has directed Freddie Mac and Fannie Mae to buy $200 billion in mortgage-backed securities, in a bid to lower mortgage rates and address growing affordability concerns. Markets are assessing the potential fallout, given details around that plan remain unclear. 

Sean Conlon and Pia Singh of CNBC also report the S&P 500 ends Friday with another record close, scores a winning week: 

The S&P 500 rose to new highs on Friday, notching a weekly gain, following the release of the latest jobs report.

The broad market index closed up 0.65% to 6,966.28, a fresh record close. It also notched a new all-time intraday high in the session. The Nasdaq Composite gained 0.81% to 23,671.35. The Dow Jones Industrial Average added 237.96 points, or 0.48%, to end at 49,504.07, scoring a new closing record as well.

The three major averages posted a winning week. The S&P 500 is up more than 1% week to date, while the Dow and Nasdaq have each jumped roughly 2%.

The December jobs report showed nonfarm payrolls increasing by 50,000 last month, less than the 73,000 that economists polled by Dow Jones had estimated. That data, though slightly weaker than expected, showed a U.S. economy that’s still trudging along, with investors anticipating that growth will ramp up.

The unemployment rate inched down to 4.4%, while economists had forecast 4.5%. Traders took that as a sign that improvement in the economy would happen soon.

Considering the latest payrolls data alongside the JOLTS and ADP reports released this week, Anthony Saglimbene of Ameriprise Financial believes the consensus around the U.S. employment backdrop is that it has “softened” but is also “remaining firm.” This reflects a “low-hire, low-fire” environment, he added.

“What could have been a risk is that you could have seen employment fall off a little bit more than expected, and I think that would have maybe kind of concerned investors,” the chief market strategist said. “We get through the week on the employment side with mostly as-expected numbers, which I think is a positive.”

The December report was the first month of jobs figures unaffected by the record-setting U.S. government shutdown. That stoppage posed data collection challenges for the Bureau of Labor Statistics with regards to October and November: The agency said that a full October jobs report wouldn’t be released, and the November report was delayed.

“This nonfarm payrolls report is the first report in a couple months that the data is clean,” Saglimbene said. “Looking at these numbers, it suggests that the Fed probably doesn’t need to cut in January, and maybe they don’t need to cut in March as well.”

Shares of homebuilders supported the broader market Friday after President Donald Trump directed “representatives” to buy mortgage bonds as a way to drive rates down for homebuyers. D.R. Horton jumped more than 6%, as did PulteGroup. Lennar advanced more than 7%. Home improvement stocks such as Home Depot also gained.

Stan Choe of the Associated Press also reports Wall Street rises to more records after unemployment rate improves:

U.S. stocks hit records Friday following a mixed report on the U.S. job market, one that may delay another cut to interest rates by the Federal Reserve but does not slam the door on it.

The S&P 500 climbed 0.6% and topped its prior all-time high set earlier in the week. The Dow Jones Industrial Average added 237 points, or 0.5%, and likewise set a record, while the Nasdaq composite led the market with a 0.8% gain.

The moves came after the U.S. Labor Department said employers hired fewer workers during December than economists expected, though the unemployment rate improved and was better than expected. It reinforced how the U.S. job market may be in a “ low-hire, low-fire” state and may hopefully avoid a recession.

On Wall Street, power company Vistra soared 10.5% to help lead the market after signing a 20-year deal to provide electricity from three of its nuclear plants to Meta Platforms. Big Tech companies have been signing a string of such deals to electrify the data centers powering their moves into artificial-intelligence technology.

Oklo jumped 7.9% after saying it also signed a deal with Meta Platforms that will help it secure nuclear fuel and advance its project to build a facility in Pike County, Ohio. 

Homebuilders and other companies involved in the housing market were strong in their first trading after President Donald Trump announced a plan to lower mortgage rates. Trump on late Thursday called for the purchase of $200 billion in mortgage bonds, similar to how the Fed in the past has bought bonds backed by mortgages to bring down mortgage rates.

Builders FirstSource, a supplier of building products, jumped 12% for one of the biggest gains in the S&P 500 along with Vistra. Among homebuilders, Lennar rallied 8.9%, D.R. Horton climbed 7.8% and PulteGroup rose 7.3%.

They helped offset a 2.7% drop for General Motors. The auto giant said it will take a $6 billion hit to its results for the last three months of 2025 related to its pullback from electric vehicles. That’s on top of the $1.6 billion in charges GM took in the prior quarter. Fewer tax incentives and easier fuel-emission regulations have been eating into demand for EVs. 

WD-40 tumbled 6.6% after reporting a weaker profit for the latest quarter than analysts expected. Chief Financial Officer Sara Hyzer said the soft numbers were primarily because of timing issues, not weaker demand from end customers, and the company stood by its financial forecasts for the upcoming year.

All told, the S&P 500 rose 44.82 points to 6,966.28. The Dow Jones Industrial Average added 237.96 to 49,504.07, and the Nasdaq composite climbed 191.33 to 23,671.35.

In the bond market, Treasury yields were mixed.

Friday’s improvement in the unemployment rate was enough to get traders to ratchet back expectations for a cut to interest rates at the Fed’s next meeting, which is scheduled for later this month. Traders are now forecasting just a 5% chance of that, down from 11% a day before, according to data from CME Group. 

But traders nevertheless still largely expect the Fed to cut rates at least twice this upcoming year.

Whether they’re correct carries high stakes for financial markets. Lower interest rates can goose the economy and push up prices for investments, though they can also worsen inflation at the same time. And inflation has stubbornly remained above the Fed’s 2% target.

“Until the data provide a clearer direction, a divided Fed is likely to stay that way,” according to Ellen Zentner, chief economic strategist for Morgan Stanley Wealth Management. “Lower rates are likely coming this year, but the markets may have to be patient.”

The yield on the 10-year Treasury eased to 4.16% from 4.19% late Thursday. It tends to track expectations for longer-term economic growth and inflation.

The two-year Treasury yield, which more closely tracks forecasts for what the Fed will do with short-term interest rates in the near term, rose to 3.53% from 3.49%.

A separate report released Friday morning suggested sentiment among U.S. consumers is strengthening, particularly among lower-income households. Perhaps more importantly for the Fed, the preliminary report from the University of Michigan also said expectations for inflation in the coming 12 months may be at their lowest level in a year. That could give it more freedom to cut interest rates. 

Hopes for both lower interest rates and a solid economy have helped other areas of the stock market climb recently, wresting leadership away from the Big Tech and AI stocks that dominated the market for years. The smaller stocks in the Russell 2000, for example, climbed 4.6% this week, much more than the 1.6% rise of the S&P 500.

In stock markets abroad, indexes rose across much of Europe and Asia.

The French CAC 40 climbed 1.4%, and Japan’s Nikkei 225 jumped 1.6% for two of the world’s bigger gains. 

Alright, busy first week of trading so let me get right to it.

First,  as shown below, the Consumer Discretionary sector led the S&P sectors this week, surging 5.8%, followed by Materials (+4.8%) and Industrials (+2.5%):

Amazon (AMZN) makes up 23% of the Consumer Discretrionary sector (Tesla makes up 21%) and it surged 9% this week, inching closer to its 52-week high:

Remember, Amazon was a laggard last year among the Mag-7 and almost everyone on Wall Street expects it to come back strong this year.

While Amazon's performance this week was impressive, there were other more impressive top performing US large cap stocks over the past 5 sessions:

Once again, Chinese biotech Regencell Biotech Holdings led the pack higher after gaining a jaw-dropping 17,500% last year, but many other stocks caught my attention this week.

Like what? Like Kratos Defense (KTOS), Oklo (OKLO), Bloom Energy (BE), Sandisk (SNDK), Applied Digital Corp (APLD), Nuscal Power Corp (SMR), Victoria's Secret (VSCO), Lam Research Corp (LCRX), Microchip Technology (MCHP) and Intel (INTC) (see full list here).

Interestingly, despite the whole Venezuela attack, energy stocks were not among the very top gainers but some did very well like SLB (SLB), Valero (VLO) and Haliburton (HAL).

Basically, oil service stocks and refiners that will benefit as Venezuela fixes its decrepit oil infrastructure.

If anything, this week was a strong week for a number of industries as performance was spread out among a number of them: defense, homebuilders, mining, tech, etc.

I truly believe 2026 will be a stock picker's year but it will not be easy and I expect a lot of volatility.

Once again, this year will reward nimble traders who know how to navigate the noise.

And you can't just look at US large caps this year, check out this week's top performing mid and small cap stocks (full list here and here):

 

A lot of biotechs I track closely took off this week, powering the small cap Russell 2000 index up almost 5%.

In fact, the 5-year weekly charts of the S&P Biotech ETF (XBI) and Russell 2000 ETF (IWM) are making new highs and looking great here (buy every dip as long as it remains above 10-week exp moving avg):

 

There are a lot of biotechs that don't figure into the indices and doing spectacular already and I foresee others taking off as news comes in, so be mindful that it's an industry where experts perform best.

I'll give you one example that took off this week, MoonLake Immunotherapeutics (MLTX) after the FDA cleared existing SLK data For HS BLA Path. Stock was trading at cash levels after the huge dump back in October:

Didn't take a genius to take risk at those levels (welcome to the wacky world of biotech). 

Alright, let me end this comment by stating I didn't feel like writing a long Outlook 2026 this year mostly because I've been spectacularly wrong in previous years and so have many others.

We know this year will be a continuation of last year, AI will remain a dominant theme, expect a fever pitch when OpenAI goes public.

We also know SpaceX will file for an IPO and that too is positive for Risk On markets. 

But as the first week of the year taught us, there are many unknowns including the Supreme Court's decision on tariffs due out next week and a lot more in geopolitics and markets.

Remember my advice, stay nimble and sweep the table when up big (trim positions).

Also, as far a the broadening trade, keep an eye on the S&P Equal Weight ETF (RSP) as it keeps making a new high (extremely bullish): 

 Below, former Federal Reserve Vice Chairman Roger Ferguson joins 'Squawk Box' to discuss the December jobs report, impact on the Fed's interest rate outlook, and more.

Also, CNBC's "Closing Bell" team discusses markets, investment strategy and more with Rich Saperstein, founding principal and chief investment officer of Treasury Partners.

Third, CNBC’s “Power Lunch” team discusses markets and the AI trade with Julian Emanuel of Evercore ISI.

Fourth, CNBC’s “Power Lunch” team discusses health care and pharma stocks as momentum in the sector builds with Jared Holz of Mizuho.

Lastly, CNBC's "Closing Bell" team discusses whether the market technicals indicate that stocks can go higher and more with Jeff deGraaf, chairman and head of technical research at Renaissance Macro Research.

Three Takeaways From Trump's Seizure Of A Russian-Flagged Tanker In The Atlantic

Authored by Andrew Korybko,

The overarching trend is that the US is militarily reasserting its historical “sphere of influence” over the Americas, and enforcing the maritime component of “Fortress America” is so important for Trump 2.0 that it’s willing to rubbish the “rules-based order” over it and even risk an accidental war with Russia.

The Russian-flagged Marinera tanker was just seized by the US in the Atlantic. It was earlier named the Bella 1 and is under US sanctions due to connections to Hezbollah. It sailed under the Guyanese flag from Iran to Venezuela and attempted to break the US’ blockade. It failed, turned around, changed its name to the Marinera, and received a temporary permit to sail under the Russian flag before being seized. Russian then demanded that its citizens on board be treated humanely and returned home.

Secretary of War Pete Hegseth posted that “The blockade of sanctioned and illicit Venezuelan oil remains in FULL EFFECT — anywhere in the world.” This preceded Attorney General Pam Bondi threatening that criminal charges might be pursued against the crew. Her tweet and Hegseth’s other one about how the US will only permit “legitimate and lawful” energy commerce with Venezuela shows that it’s once again assuming so-called “police” functions. Here are three takeaways from this incident:

1. The US Is Surprisingly Nonchalant About An Accidental War With Russia

It was brazen even by the US’ standards to seize a Russian-flagged tanker, especially after Western media reported that Russia had dispatched ships and a submarine to escort it, which Russia didn’t confirm and none were nearby during the seizure. Nevertheless, Trump 2.0 calculated that there’d be no retaliation despite the deputy chairman of Russia’s parliamentary defense committee warning that “any attack on our carriers can be regarded as an attack on our territory, even if the ship is under a foreign flag.”

This incident interestingly occurred in parallel with the US backing European ceasefire guarantees for Ukraine that include British and French commitments to deploy troops there during that time even though Russia has repeatedly warned that they’d be legitimate targets. Quite clearly, the US is now surprisingly nonchalant about an accidental war with Russia, whether over seizing one of its flagged ships at sea or over NATO allies getting killed in Ukraine. This observation won’t be lost on Russia.

2. “Fortress America” Also Includes An Important Maritime Component

The goal of restoring the US’ unipolar hegemony over the Americas, which is described as the highest regional priority in its new National Security Strategy, can be referred to as building “Fortress America”. This isn’t being pursued just for reasons of prestige but also pragmatism in the sense of enabling the US to survive and even thrive if it’s ever expelled from the Eastern Hemisphere or decides to retreat from there since control over the hemisphere’s resources and markets would all but ensure this outcome.

As can be seen by this incident as well as Hegseth’s and Bondi’s posts about it, there’s also an important maritime component related to controlling the export of oil from Venezuela, which has the world’s largest reserves. This can only be achieved by maintaining the unilateral blockade and seizing all ships that violate it, both on law enforcement pretexts that embody the concept of extraterritoriality. Without this maritime component, “Fortress America” could never truly be built, but it’s not without some costs.

3. The US Is Dismantling The “Rules-Based Order” That It Built Over The Decades

The abovementioned point segues into the last one about how the US’ militarily enforced extraterritoriality vis-à-vis Venezuela dismantles the “rules-based order” that it built over the decades for maintaining its unipolar hegemony over the world after the end of the Old Cold War. This violates the international laws that the US used to selectively police across the world according to its arbitrary standards. Instead of international ones, the US is now policing its own, but also in pursuit of hegemony.

International law has increasingly become illusory due to the UN’s innate dysfunction, which is related to the deadlock among the UNSC’s five permanent members, with one usually vetoing significant proposals from the others. Even so, if the Great Powers abided by it in their ties with one another, then there’d be more predictability and less risk of war by miscalculation. The US is no longer interested in even that as proven by this incident, however, since building “Fortress America” now takes precedence over all else.

The trend connecting the three aforementioned takeaways is that the US is militantly reasserting its historical “sphere of influence” over the Americas, and this is so important for Trump 2.0 that it’s willing to rubbish the “rules-based order” over it and even risk an accidental war with Russia. The maritime component off of Venezuela’s Caribbean coast that’s been built before all else is justified by the administration as a law enforcement operation that prioritizes domestic laws over international ones.

Since this is taking place on the other side of the world where neither half of the Sino-Russo Entente has any military bases, they can’t challenge this even through indirect means, unlike how the US challenged Russia’s reassertion of its own historical “sphere of influence” in Ukraine through the ongoing proxy war. This doesn’t mean that the US’ grand strategic goal of restoring its unipolar hegemony over the Americas will succeed, just that if it doesn’t, then it’ll be due to intra-hemispheric reasons and not external forces.

Tyler Durden Fri, 01/09/2026 - 20:00

Watch: Conservative Honduran Lawmaker Narrowly Survives Bomb Hurled At Her In National Congress

A shocking scene played out in a Latin American country Thursday, but this time it's not Venezuela, but nearby Honduras.

A Honduran legislator from the country's conservative National Party of president-elect Nasry Asfura was speaking to the press within the halls of the Honduran national congress, or just outside, when suddenly an explosive device was thrown, detonating just behind her head. The disturbing incident, which she survived, was filmed given the many cameras around at the time of the attack.

Opposition legislator Gladis Aurora Lopez was injured by an explosive device hurled at her in the Congress building.

Deputies had been summoned to meet, and the attack victim - Gladis Aurora López - collapsed to the floor during the explosion, her jacket left torn apart.

Witnesses immediately rushed her to begin giving her medical attention, and authorities in a later update announced that her injuries were thankfully not life-threatening.

Lawmakers had gathered to debate a proposal from LIBRE calling for an election recount, despite electoral officials having already declared a winner in December.

Quickly after, accusations and threats are flying, threatening to unleash severe infighting or instability among rival political factions.

Tomás Zambrano, head of the National Party’s congressional delegation, charged the outgoing governing leftist Liberty and Refoundation Party, known as LIBRE, with being behind the incident.

Zambrano denounced the incident as nothing less than attack on the National Party, and it comes at a sensitive moment, where a fiercely contested presidential election at the end of November led to a vote count that dragged on for weeks and ended in a disputed result.

The National Party’s candidate, Nasry Asfura, was eventually proclaimed the victor nearly a month later.

"Today I speak not as a representative, but as a Honduran," a fellow conservative deputy, Antonio Cesar Rivera, later stated on social media. "I condemn with absolute firmness the cowardly attack against Gladis Aurora Lopez and I stand in solidarity with her."

Honduran National Party lawmaker Gladis Aurora López Calderón was injured after far-left protesters hurled an explosive device at her outside the National Congress. pic.twitter.com/YDGuvfUUzQ

— Polymarket Intel (@PolymarketIntel) January 9, 2026

He linked the political violence to attacks on the Right, accusing LIBRE groups of attacking him, too. "Those who promote hatred and intimidation are attacking democracy," he wrote.

It's as yet unclear what an ongoing police investigation has uncovered, or just who the culprit was. But clearly the country's congressional building needs to quickly beef up its security protocol. 

Tyler Durden Fri, 01/09/2026 - 19:30

Prosecutor Calls Newsom 'King Of Fraud' For Oversight Failures

Authored by Dave Mason via The Center Square,

U.S. First Assistant Attorney Bill Essayli Thursday called California Gov. Gavin Newsom “the king of fraud,” accusing him of a lack of oversight on spending to address homelessness.

FILE - California Gov. Gavin Newsom speaks during a press conference in Los Angeles, Wednesday, Sept. 25, 2024. (AP Photo/Eric Thayer, File)

Essayli made the comments on the “Fox and Friends” telecast, during which he discussed the federal fraud charges that were filed in October against real estate executives Steven Taylor and Cody Holmes for allegedly misusing grant money meant for homeless housing.

Holmes, 31, of Beverly Hills was charged with mail fraud charge that was allegedly linked to millions of dollars in grant money that the state paid Shangri-La Industries to purchase, build and operate homeless housing in Thousand Oaks, just north of Los Angeles. Holmes was Shangri-La’s chief financial officer.

Taylor, 44, of Brentwood, was charged with seven counts of bank fraud, one count of aggravated identity theft and one count of money laundering.

Essayli Thursday said the charges are the “tip of the iceberg” in an investigation he launched with a task force in April. He said more charges would be coming, probably later this month.

The state spent $24 billion in the last five years to address homelessness and can’t account for where the money went, Essayli said on “Fox and Friends.”

President Donald Trump on Tuesday on X said,  “California, under Governor Gavin Newscum, is more corrupt than Minnesota, if that’s possible??? The Fraud investigation of California has begun.”

Newsom’s press office fired back on X. It called Trump a liar and noted Newsom has “BLOCKED $125 billion in fraud, arrested criminal parasites leaching off of taxpayers, and protected taxpayers from the exact kind of scam artists Trump celebrates, excuses, and pardons.”

The Center Square reached out Thursday afternoon to the governor’s office, but did not get a response.

When The Center Square asked the White House Thursday about Newsom, the press office pointed to Press Secretary Karoline Leavitt’s comments during a press briefing on Wednesday. Leavitt told reporters that Trump has directed all agencies to look at federal spending programs “in not just Minnesota, but also in the state of California, to identify fraud and to prosecute to the fullest extent of the law, all those who have committed it.”

The Center Square also reached out to the U.S. Department of Justice, but spokesperson Ciaran McEvoy said the DOJ had no additional comment.

But two Republican legislators in Sacramento Thursday shared their views about Newsom with The Center Square.

“When you talk about the amounts of billions of dollars the governor’s spent in homelessness, he could almost buy a home for every homeless person,” state Sen. Tony Strickland, R-Huntington Beach, told The Center Square at the Capitol after Newsom’s final State of the State address.

“There’s no question there is waste in there, and certainly, we need to look to see if there’s fraud and abuse,” Strickland said. “So I welcome the investigation, because we need to maximize every dollar that comes into the state coffers.”

Strickland stressed he wants to learn the truth.

“Those who abused the power and those who wasted dollars and abused tax dollars should be prosecuted,” he said. “Then we should root out waste, because every dollar that is wasted is a dollar that we take from a hard-working citizen who is just trying to make it.

“In California right now, we have an affordability crisis and these are precious dollars, and by Gov. Newsom’s own admission, revenues are up, so California doesn’t have a revenue problem,” Strickland said. “It has a wasteful spending problem.”

Izzy Swindler, a spokesperson for Assemblymember Tom Lackey, said the Palmdale Republican has always supported oversight on spending.

“It is his belief that we should be accountable to our dollars and be able to track the results that come from the taxpayer funded programs,” Swindler said, answering The Center Square’s questions by email. “Accountability should always be at the forefront of discussions. Especially when we are referring to homelessness programs that have been allocated billions of dollars over the past few years.”

Tyler Durden Fri, 01/09/2026 - 19:00

Residential Electricity Prices Are Surging Even More

We have been warning about this for months...

In one year, this will be the most popular chart on this site pic.twitter.com/h93gWXMoNL

— zerohedge (@zerohedge) August 11, 2025

... and months....

between exploding electricity bills and lack of jobs for grads, a new luddite revolution is coming - they will be burning down data centers within a year

— zerohedge (@zerohedge) August 25, 2025

... and now that even the deep state spies at the WaPo finally catching on...

5 months later https://t.co/reP3n5lhfp pic.twitter.com/5Lg5pPiXl4

— zerohedge (@zerohedge) January 6, 2026

... the future has finally caught up to the present,

As Bloomberg warns, rising retail electricity prices have become a political issue in several US states, especially in PJM, the Mid-Atlantic regional grid, which as we discussed recently, is woefully under-energized.

"eight out of the 13 US regional power markets are already at or below critical spare capacity levels." - Goldman https://t.co/YYAGUukfwR pic.twitter.com/eU4XPFAMrp

— zerohedge (@zerohedge) November 23, 2025

As Bloomberg says, paraphrasing us 5 months ago, "Power prices emerged as a a major campaign theme in off-year elections in New Jersey and Virginia in 2025, and will play a big role in 2026's upcoming national midterms and state elections."

This is just the start: as we discussed over a month ago, data center power demand could reach 106 GW in 2035, For context, the US had about 25 GW of operating data centers in 2024 (according to Bloom Energy). Which means that unless all these data centers somehow find behind the meter sources of collocated power, electric bills will, pardon the pun, go nuclear. 

A July report from the Department of Energy estimated an additional 100 GW of new peak capacity is needed by 2030, of which 50 GW is attributable to data centers. Those facilities could account for as much as 12% of peak demand by 2028, according to Lawrence Berkeley National Laboratory.

Bloomberg's conclusion: "Affordability politics have mixed implications for climate (renewables are cheap, but some programs expensive), and for data centers, which take the blame for rising prices."

Our question: how long before Trump imposes price caps/controls on utilities ahead of the midterms (similar to those at PJM, which were the only thing that prevented a 60% spike in prices) to keep electric bills low, and sends IPP stocks freefalling.

Tyler Durden Fri, 01/09/2026 - 18:30

"The Giant Sucking Sound": Exodus From California Continues For Taxpayers & Businesses

Authored by Jonathan Turley,

During the 1992 Presidential Debate, independent candidate Ross Perot famously warned that “there will be a giant sucking sound going south” due to the cheaper Mexican labor and lower regulatory demands on businesses. That sound is being heard again, but this time it is coming from California, which is virtually chasing taxpayers and companies out of the state with a massive state deficit, rising taxes, crippling regulations, and wasteful programs.

Recently, Gavin Newsom boasted, “California isn’t just keeping pace with the world — we’re setting the pace.”

Recent data shows he is right.

There is a record number of U-Hauls fleeing the state — more than any other state. Indeed, the only thing harder to find than a wealthy taxpayer in California appears to be a U-Haul.

According to U-Haul’s data, the state is again leading blue states in the exodus. The Washington Post noted this week that “California came in last. Massachusetts, New York, Illinois and New Jersey rounded out the bottom five. Of the bottom 10, seven voted blue in the last election.” Conversely, “nine of the top 10 growth states voted red in the last presidential election,” with Texas again leading the growth states.

The Post wrote that the conclusions are inescapable: “People want to live in pro-growth, low-tax states, while the biggest losers tend to be places with big governments and high taxes.”

What is most striking is how Democratic politicians and many voters are simply defying the data and logic. Democratic Rep. Ro Khanna, who represents part of Silicon Valley, recently mocked billionaires moving to escape a planned wealth tax. Some of us have criticized the tax as perfectly moronic for a state with the highest tax burden, soaring deficit, and shrinking tax base.

The “2026 Billionaires Tax Act” would impose a one-time 5% tax on individual wealth exceeding $1 billion. While technically using 2026 wealth figures, it would apply to billionaires who resided in California in 2025. So you cannot hope to flee… at least with your wealth intact. It is a penalty for those who stay too long hoping that rational minds would prevail in California.

Yet, Rep. Khanna mocked his own constituents planning to flee the state, quoting FDR in saying ‘I will miss them very much.”

Indeed, you will. 

Democrats continue to act as if wealthy citizens are a type of captive audience. They are expected to be voluntary prey in a canned hunt for wealthy taxpayers. Many have chosen to take their money and businesses elsewhere.

As I discuss in my forthcoming book, Rage and the Republic: The Unfinished Story of the American Revolution, there is a common myth that the top five percent of this country do not “pay their fair share.” However, putting that debate aside, the question is whether it will produce more revenue than it costs the state in the long run. As these politicians campaign on clipping the “fat cats” who are not paying their fair share, many are likely to follow the exodus to lower tax states with greater fiscal discipline.

From New York to California, Democrats are pitching new programs from free buses to state-run stores to reparations as their tax bases contract. San Francisco recently approved the reparations plan that could give up to $5 million to qualified residents. The city faces a billion-dollar deficit, yet it continues to assume greater debt obligations.

Once again, denying basic economics will only lead to a rude awakening when these leaders, to quote Margaret Thatcher, “run out of other people’s money.”

Tyler Durden Fri, 01/09/2026 - 18:05

Trump Says US Will Begin Strikes On Cartels In Mexico

Authored by Joseph Lord and Kimberley Hayek via The Epoch Times,

President Donald Trump announced in an interview aired Jan. 8 that the United States would begin launching strikes on cartels in Mexico.

“We knocked out 97 percent of the drugs coming in by water, and we are going to start now hitting land with regard with the cartels,” Trump told Sean Hannity from Fox News.

“The cartels are running Mexico. It’s very sad to watch and see what’s happened to that country.

“They’re killing 250,000, 300,000 in our country every single year.”

The announcement comes just five days after Trump ordered an operation to capture and remove Venezuelan leader Nicolás Maduro to the United States to face criminal charges, including narco-terrorism.

Trump gave a warning to several Latin American countries following the U.S. strike on Venezuela and Maduro’s capture.

The president also warned Mexico on Sunday that it needs to “get its act together,” referring to drug cartels operating in the country.

“You have to do something with Mexico,” Trump told reporters during his trip back to Washington from Florida. “We’re going to have to do something. We’d love Mexico to do it; they’re capable of doing it, but unfortunately, the cartels are very strong in Mexico.”

Trump said that he had spoken to Mexican President Claudia Sheinbaum on a number of occasions, saying that the United States has offered to send troops into her country. However, he described her as “afraid” and that the “cartels are running Mexico,” not her

Mexico has repeatedly opposed U.S. proposals to fight drug cartels in the country.

“We categorically reject intervention in the internal affairs of other countries,” Sheinbaum said during her daily morning press conference on Monday. “The history of Latin America is clear and compelling: Intervention has never brought democracy, never generated well-being, nor lasting stability.”

Trump’s administration has intensified anti-cartel measures, including designating Mexican syndicates as terrorist organizations, a step he announced years ago. Officials say sea-based trafficking has been nearly halted, prompting a pivot to land operations.

Trump has previously said no formal war declaration is necessary.

“I think we’re just going to kill people that are bringing drugs into our country,” Trump said on Oct. 23, 2025.

U.S. officials have linked cartels to tens of thousands of American overdose deaths annually. Trump has criticized Sheinbaum for declining U.S. offers to dismantle the cartels.

Trump did not give a timeline for land strikes against cartels.

Tyler Durden Fri, 01/09/2026 - 17:15

As ordered reported by the House Committee on Foreign Affairs on December 3, 2025

As ordered reported by the House Committee on Foreign Affairs on December 3, 2025

Rio Tinto And Glencore In Talks To Form World's Largest Mining Company With $200 Billion Valuation

Are we on the cusp of an M&A boom in metals and commodities, with prices continuing to soar? Or are deals just easier to get through under a new administration?

Regardless, Rio Tinto and Glencore have reopened merger talks that could create the world’s largest mining company, with a combined valuation exceeding $200 billion — more than a year after earlier negotiations collapsed, according to Yahoo.

The companies confirmed Thursday that they are discussing various deal structures, including an all-share takeover covering part or all of Glencore’s business. The market reacted swiftly: Glencore shares jumped about 10% in London, while Rio slipped more than 2%.

If completed, the transaction would eclipse any previous mining merger and create a giant capable of rivaling BHP. Copper is the central prize. With prices recently surging above $13,000 a ton amid supply disruptions and tariff fears, mining executives increasingly see copper as the industry’s most strategic asset. “It makes a lot of sense,” said Ben Cleary of Tribeca Investment Partners. “It’s the one big deliverable mining deal out there.”

Yahoo writes that for Rio, absorbing Glencore would sharply expand copper output and provide access to prized assets such as Chile’s Collahuasi mine. The move would also help reduce dependence on iron ore as China’s construction boom fades.

Although analysts have questioned whether Rio would accept Glencore’s large coal business, people familiar with the talks say Rio is now open to keeping it — at least initially — and could divest later. No final structure has been agreed.

The renewed talks follow major changes at both firms. Rio has a new chief executive, Simon Trott, who has emphasized cost discipline and simplification, while Glencore has highlighted plans to nearly double copper production over the next decade. In private, Glencore CEO Gary Nagle has described a tie-up with Rio as the most logical deal in the sector.

“This is Simon’s first test as CEO and I would expect his disciplined approach to be carried through to M&A,” said John Ayoub of Wilson Asset Management.

The discussions come amid a broader wave of consolidation after Anglo American’s deal for Teck Resources and earlier takeover interest from BHP. Under UK rules, Rio must decide by Feb. 5 whether to proceed or step back for six months.

Tyler Durden Fri, 01/09/2026 - 14:25

Today, in the Calculated Risk Real Estate Newsletter: The "Home ATM" Mostly Closed in Q3

A brief excerpt:

During the housing bubble, many homeowners borrowed heavily against their perceived home equity - jokingly calling it the “Home ATM” - and this contributed to the subsequent housing bust, since so many homeowners had negative equity in their homes when house prices declined.
...
Here is the quarterly increase in mortgage debt from the Federal Reserve’s Financial Accounts of the United States - Z.1 (sometimes called the Flow of Funds report) released today. In the mid ‘00s, there was a large increase in mortgage debt associated with the housing bubble.

In Q3 2025, mortgage debt increased $108 billion, unchanged from $108 billion in Q2. Note the almost 7 years of declining mortgage debt as distressed sales (foreclosures and short sales) wiped out a significant amount of debt.

However, some of this debt is being used to increase the housing stock (purchase new homes), so this isn’t all Mortgage Equity Withdrawal (MEW).

Micro Greenland Lender Whipsaws As Trump Headlines Ignite Investor Frenzy

Shares of a Nuuk-based commercial bank, founded in 1967 to serve Greenland's private and corporate customers, have surged sharply as investors speculate that President Trump's "Donroe Doctrine" to secure the Western Hemisphere could ultimately involve acquiring Greenland.

The 42% rally in Bank of Greenland shares this year, which has since retraced roughly 20% of those gains, has been entirely headline-driven, linked to the Trump administration's efforts to acquire the mineral-rich, strategically located territory in North America, rather than by fundamentals.

Per Hansen, an investment economist at Nordnet Bank AB, said investors were piling into Bank of Greenland shares on the OMX Copenhagen Mid Cap Index, whose market capitalization stands at around 1.91 billion kroner ($298 million).

"Greenland could see massive investment," Hansen said. "I do not know, and investors do not know, what will happen, but it might happen. More investment means more business buzz."

In other words, investors are buying Bank of Greenland shares first and asking questions later.

Nuuk, Greenland

Overnight, Reuters reported that the Trump administration has considered sending lump-sum payments of up to $100,000 to Greenlanders in exchange for a vote to secede from Denmark and join the United States.

Trump has cited several reasons for acquiring Greenland, including its mineral wealth for military applications and the need for the Western Hemisphere to fall under Washington's geopolitical influence.

Hmm. 

The simple diplomatic solution is Barron Trump marries Princess Isabella of Denmark and Greenland is given to America as dowry payment pic.twitter.com/fhs3b6IDZG

— miss white (@cinecitta2030) January 7, 2026

The Bank of Greenland stock frenzy also follows recent U.S. regime-change operations in Venezuela that removed socialist leader Nicolás Maduro roughly a week ago, reinforcing perceptions of a more interventionist U.S. posture in the Western Hemisphere aimed at pushing China and Russia out of the region and dismantling socialist and Marxist regimes seen as plundering the wealth of nations. 

Tyler Durden Fri, 01/09/2026 - 14:05

The federal budget deficit totaled $601 billion in the first quarter of fiscal year 2026, the CBO estimates.

Seattle Judge Blocks Health Department From Rejecting Head Start Grants With DEI Terms

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

The Department of Health and Human Services (HHS) must stop requiring that grant applications not include terms related to diversity, equity, and inclusion (DEI), including the term “pregnant people,” under a new order from a federal judge.

Health Secretary Robert F. Kennedy Jr. delivers remarks during an event in the Oval Office of the White House on Oct. 16, 2025. Kevin Dietsch/Getty Images

They are also enjoined from firing any more Office of Head Start employees and closing regional offices.

HHS has said it does not comment on litigation.

The decision “ensures that Head Start providers can provide early education to children from diverse communities and backgrounds without the constant threat of being punished simply for following the requirements of the law,” Jennie Mauer, executive director of the Wisconsin Head Start Association, said in a statement.

Head Start is a federally funded program that provides care across some 17,711 centers to about 750,000 children from low-income families.

The lawsuit was filed by the American Civil Liberties Union over several actions taken by HHS in response to President Donald Trump’s Jan. 20, 2025, executive order banning “diversity, equity, inclusion, and accessibility“ and the “indoctrination of gender ideology.”

HHS, in an updated policy on grants, required applicants to certify they would not operate programs that advance DEI or discriminatory ideology.

According to court filings, HHS later returned applications with instructions to remove certain terms, including the terms “pregnant people,” “chestfeeding,” and “diversity.”

HHS also said that a Head Start center on an American Indian reservation in Washington state should remove eligibility criteria, which prioritized children from Indian families.

“Based on these instructions from the Office of Head Start, the program does not know what criteria it is supposed to use to determine enrollment for the program going forward,” Joel Ryan, executive director of the Washington State Association of Head Start and Early Childhood Assistance and Education Program, said in a filing.

The defendants told Martinez that they withdrew the certification requirement, making that challenge moot, and that plaintiffs had not shown the requirement, the mandated removal of DEI terms, and layoffs at the Office of Head Start caused the plaintiffs harm.

Tyler Durden Fri, 01/09/2026 - 13:25

The Federal Reserve released the Q3 2025 Flow of Funds report today: Financial Accounts of the United States.

The net worth of households and nonprofits rose to $181.6 trillion during the third quarter of 2025. The value of directly and indirectly held corporate equities increased $5.5 trillion and the value of real estate decreased $0.3 trillion.
...
Household debt increased 4.1 percent at an annual rate in the third quarter of 2025. Consumer credit grew at an annual rate of 2.3 percent, while mortgage debt (excluding charge-offs) grew at an annual rate of 3.2 percent.

Click on graph for larger image.

The first graph shows Households and Nonprofit net worth as a percent of GDP.  
Net worth increased $6.1 trillion in Q3.  As a percent of GDP, net worth increased in Q3 but is still below the peak in 2021.
This includes real estate and financial assets (stocks, bonds, pension reserves, deposits, etc.) net of liabilities (mostly mortgages). Note that this does NOT include public debt obligations.

The second graph shows homeowner percent equity since 1952.

Household percent equity (as measured by the Fed) collapsed when house prices fell sharply in 2007 and 2008.

In Q3 2025, household percent equity (of household real estate) was at 71.6% - down from 72.0% in Q2, 2025

Note: This includes households with no mortgage debt.

The third graph shows household real estate assets and mortgage debt as a percent of GDP.  

Mortgage debt increased by $108 billion in Q3.

Mortgage debt is up $2.99 trillion from the peak during the housing bubble, but, as a percent of GDP is at 43.9% - down from Q2 - and down from a peak of 73.1% of GDP during the housing bust.

The value of real estate, as a percent of GDP, decreased in Q3 and is below the recent peak in Q2 2022, but is well above the median of the last 30 years.

"Screwing Us Over... Again": Shale Producers Furious Over Trump's Venezuela Plan To Lower Crude Prices

President Trump is meeting with oil bosses on Friday, but shale producers aren't necessarily happy about the development of driving crude prices down via expanding into Venezuela. 

In fact, independent U.S. drillers are warning President Donald Trump that his push to revive Venezuela’s oil industry — and drive prices lower — could cripple American production, according to FT.

Many shale leaders, excluded from that meeting, say the White House is abandoning domestic producers by opening the door to a flood of Venezuelan crude. “We’re talking about this administration screwing us over again,” one senior executive said, calling the strategy “against American producers.” Another warned: “If the US government starts providing guarantees to oil companies to produce or grow oil production in Venezuela I’m going to be . . . pissed.”

The anger is deep in Texas, where many executives backed Trump’s return and now describe the shift as a “betrayal.”

Kirk Edwards, chief executive of Latigo Petroleum, said:

“To me, the signal from the administration is: we’d rather spend our American money on propping up a Venezuelan oil business than supporting our current independent businesses.”

FT writes that pressure is already building. The number of active U.S. rigs has fallen to 412, down 15% in a year, and the Energy Information Administration expects U.S. output to drop in 2026 — the first annual decline since the pandemic. With West Texas Intermediate below $56 a barrel and many shale producers needing prices above $60 to break even, the industry is under strain.

Meanwhile, new supply risks loom. OPEC producers are adding output, and Trump has made clear he wants cheaper oil and gasoline as the midterms approach. U.S. Energy Secretary Chris Wright said Venezuela’s production could jump 50% within a year. “I think you’ll see more downward pressure on the price of gasoline,” he told Fox News.

Executives say Wright is now “just toeing the party line,” and the frustration ultimately lands on Trump. “He’s definitely not pro oil as far as independent oil companies’ survival and vibrancy,” one Midland executive said. “The message will have to come in US production declining.”

Markets are reacting. Shares of Diamondback Energy, APA Corp and Devon Energy each fell as much as 9% this week. “Somebody’s looking at these stocks today going, why would I own this if in a few years, they’re going to be competing against Venezuela for oil, for our refineries in the United States?” Edwards said.

Outrage intensified after Trump suggested taxpayers could help reimburse companies investing in Venezuela. “We should not subsidise the big companies in trying to retool Venezuela’s infrastructure and develop their reserves for them,” another shale executive said, adding Trump does not “give a damn if they went bankrupt” and is content to see them “drill their way into oblivion.”

Analysts say the divide favors the largest firms. “All of this points to the advantage of being larger,” said Maynard Holt of Veriten. “Because many of the opportunities that are coming — whether it’s Venezuela or Algeria or some other complicated place — you will be able to consider them more seriously the larger you are.”

Tyler Durden Fri, 01/09/2026 - 12:45

The Price Of Trump's "Greenland New Deal": $100,000 Per Person

By Bas van Geffen, Senior Macro Strategist at Rabobank

President Trump has called for a 50% increase of the US defense budget, to $1.5 trillion by next year. This should suffice to build a “Dream Military.” The president argues this is required to keep the US safe and secure, but will it keep his own political position safe? Trump’s new military focus is creating more friction in Congress, as well as between the US and its allies.

Trump argued that tariff revenues can “easily” pay for a bigger defense budget, but the CBO has estimated that tariff revenues will only generate about half of the president’s planned increase in military expenditures. And that assumes these revenues will keep flowing. Trump could face a setback on that front as early as today (see below).

Even if tariff revenues keep coming in, Trump’s plans could renew concerns about the sustainability of the US’ finances. Cuts in other parts of government might be an option on paper, but Trump does need congressional support for this. And the House of Representatives has just passed legislation on a spending bill that waters down many of Trump’s budget cuts – including restoring Obamacare subsidies for three years – as lawmakers seek to avoid another shutdown by the end of the month.

In international political circles, there is less alarm about the US’ fiscal prudence than there are concerns about what the president may want to use such an expanded military apparatus for. Despite his platform of noninterventionism, Trump has already been more active on the world stage than during his first term.

Yesterday, the US president suggested that military operations in Venezuela – or the wider region? – are not over after the quick capture of President Maduro last weekend: “we’ve knocked out 97% of the drugs coming in by water, and we are going to start now hitting the land.”

Congress is pushing back against further strikes. Five Republican senators joined with the Democrats to advance a bill that would limit Trump’s ability to take further military action in Venezuela without congressional approval.

However, for the war powers resolution to have any effect, it must first pass a final vote in Senate and it must then still pass the House – and with support from more than a handful of Republicans: President Trump could veto the bill unless it gets a two-thirds majority in both houses of Congress. More importantly, the bill focuses on military operations in Venezuela.

That still leaves countries like Mexico, which “is being run by cartels” according to Trump, or Colombia at risk. Several senators have said they plan to introduce similar resolutions for other countries (e.g., Greenland, Colombia, Cuba, Mexico, and Nigeria). However, these have not been included in the current resolution due to Senate rules requiring country-specific legislation.

And then there is the Arctic. At the start of this week, Trump reiterated his plans to acquire Greenland, and he has since not let go of the idea. The US president may prefer to buy the country. According to Reuters’ sources, US officials have discussed lump sum payments of $10,000 to $100,000 per Greenlander in order to convince them to become part of the United States. However, that’s just one plan, and Trump has not ruled out military means to get what he wants.

"with a population of only around 50,000, one might imagine a thought experiment where, for the low, low price of $50 billion, Trump offers every Greenlander $1 million in exchange for their country. That might prove more attractive." - Rabobank

— zerohedge (@zerohedge) January 6, 2026

European deterrence is limited. In fact, the EU must be careful not to alienate the country that they still need to safeguard their own security. Zelenskyy had just claimed an agreement on security guarantees, which was ready for finalization with the US president, but Russia has already rejected a European peacekeeping force in the country –a key part of the proposal– as an immediate threat to Russian security.

So, the EU may still try to change Trump’s mind through diplomacy. Denmark has already agreed to give the US military extensive access to Greenland. Perhaps a buildup of EU military presence in the Arctic could reassure the US that Europe can help to keep the region safe. But that would be another drain on the EU’s limited resources, and it remains to be seen whether this is enough to convince the US president. Canada will probably be watching this space anxiously too.

Tyler Durden Fri, 01/09/2026 - 12:25

Trump Cancels 2nd Wave Of Strikes On 'Cooperative' Venezuela - Political Prisoners Freed

The post-Maduro Venezuelan government has begun releasing political prisoners as a gesture of 'good will' to the United States, signaling that the new Delcy Rodriguez government is ready to play nice with Trump. There are reasons to believe that this former Maduro number two (as his vice president) had cooperated with the CIA to hand the longtime Venezuelan president and socialist strongman over to invading American forces during last Friday night's raid.

President Trump said early Friday that he had cancelled a "previously expected" second wave of attacks on the Latin American country as Caracas is now cooperating with the US. It must be recalled that soon after the attack which ousted Maduro and brought him into US custody, Trump had warned, "We are ready to stage a second and much larger attack if we need to do so. He added: "We actually assumed that a second wave would be necessary, but now it’s probably not." Presumably this meant cartel targets, but this brings up the question: where are all the 'narco-terrorists' and did they magically disappear now that Maduro was taken out?

via AP

In a Friday Truth Social post, the president emphasized the White House and new Caracas authorities are "working well together, especially as it pertains to rebuilding, in a much bigger, better, and more modern form, their oil and gas infrastructure."

"Because of this cooperation, I have cancelled the previously expected second Wave of Attacks, which looks like it will not be needed, however, all ships will stay in place for safety and security purposes," he added.

Trump confirmed that the government is busy "releasing large numbers of political prisoners as a sign of ‘Seeking Peace,'" adding, "This is a very important and smart gesture." Local news footage also appeared to verify this - a longtime demand of Washington and its allies in Europe.

AFP reports: Venezuela begins releasing a "large number" of political prisoners, including several foreigners, in an apparent concession to the United States after its ouster of ruler Nicolas Maduro

Venezuela begins releasing a "large number" of political prisoners, including several foreigners, in an apparent concession to the United States after its ouster of ruler Nicolas Madurohttps://t.co/EWfcPTLkzq pic.twitter.com/LZtPaZRgA1

— AFP News Agency (@AFP) January 9, 2026

The head of the country's National Assembly, Jorge Rodríguez, announced the release of a "significant number" of political prisoners, which is being taken to mean by outside observers that this is most, if not all, political prisoners which the US has demanded the release of.

One prominent name among those reportedly freed is the following:

Rocío San Miguel, a vocal critic of Maduro and a defense expert, was the first prisoner confirmed to be freed. Her family told the New York Times that she was taken to the Spanish embassy in Caracas.

Arrested in 2024, she was accused of being involved in a plot to kill the then-president and faced charges of treason, conspiracy and terrorism. Her arrest shocked human rights activists and, because her whereabouts were unknown, was labelled as potential "enforced disappearance" by the UN Human Rights Office.

As for Trump's claim that he has called off a 'second strike' - there's as yet no real evidence that the Pentagon was actually preparing such a new offensive, but heavy US assets are certainly still in the region and in regional waters. Trump could be bluffing on this, and very likely is, in order to keep Caracas on edge and cooperative.

Tyler Durden Fri, 01/09/2026 - 12:05