Huge thanks to Kimpton Bradford for being my monthly sponsor again. His words:
“During this early autumn month, let’s thank the intellectual giants who came before us and helped illuminate the path towards recognising the dramatic changes taking place in our environment. Henry David Thoreau, John Muir and Aldo Leopold form part of a remarkable intellectual throughline, laying the foundations for so many of the thinkers we listen to and lean on today.”
“What Would Turn Oil Shock, AI Bubble, El Niño Into A Financial Crisis?
“The shocks are not the danger. The danger is that the same lender ends up carrying all three. A financial crisis does not start when losses appear. It starts when losses reach the system that supplies credit: lenders weaken, funding dries up, and businesses that were managing their own costs cannot refinance.”
“The big one is rumbling in the bond market.
“Government borrowing costs are their highest since the eve of the global financial crisis 19 years ago, and rising at a pace not seen since long before then. The tectonic plates of the global economy have shifted… A trend that had been clear ever since the brief post-pandemic boom turned into resurgent inflation and higher rates has suddenly accelerated.”
https://www.afr.com/markets/debt-markets/the-big-one-is-rumbling-in-the-bond-market-20260930-p611ox
“Japan bond yields hold near multi-decade highs after 40-year auction amid inflation concerns.
“Global bond markets remained under pressure as US Treasury yields climbed to multi-year highs, driven by inflation fears linked to surging oil prices and expectations of further Federal Reserve rate hikes. Bets are rising that the Bank of Japan will raise rates again by the end of the year.”
“RBA lifts rates to highest level in 15 years – risking a sharper slowdown of the economy.
“The Reserve Bank of Australia has raised the cash rate to 4.6% from 4.35%, taking the key rate to its highest level since late 2011 as it battles persistent inflation. The fourth rate hike this year will add about A$120 a month to the average mortgage of $730,000.”
“Bond Massacre: 30-Year Treasuries Crash 60% Since 2020, Wiping Out Two Decades of Gains.
“U.S. debt surpassing $40 trillion, foreign central banks retreating, and corporate bond issuance up 30% have created a supply glut crushing long bonds. The Treasury’s next refunding announcement is the decisive signal. Continued long-dated issuance into a 5.6% market would deepen losses and push mortgage rates higher.”
“How a Global Debt Crisis Starts.
“Over the past year, the global bond sell-off has been a shape-shifter, hitting first here and then there. But in recent months it’s zeroed in on these two places as the most vulnerable. They’re now on the cusp of full-blown crisis.”
https://robinjbrooks.substack.com/p/how-a-global-debt-crisis-starts-2e0
“Brent Crude Near $103 As Strait Of Hormuz Uncertainty Offsets Saudi Supply Recovery…
“Iran offered last week to reopen the Strait of Hormuz in seven days if the US commits to the conditions of the failed June memorandum of understanding. However, President Donald Trump rejected Tehran’s proposal on Saturday as oil exports through Hormuz recover.”
“Global economic impact of Iran war ‘unbearable,’ Qatar warns as talks continue.
““How long can the international economy withstand the results of what is happening in our region?” Foreign ministry spokesperson Dr Majed Al Ansari said at a press briefing in Doha… Dr Al Ansari said the Gulf exported far more than oil and gas to the world, including urea and ammonia, important to agriculture and fertiliser production, as well as helium, petrochemicals and aluminium.”
“Anthropic reveals biggest pre-IPO loss in history.
“Anthropic holds the world record for having the biggest annual net loss preceding an IPO in history at $42 billion… If reports are correct that Anthropic is looking for a $2 trillion valuation at the IPO then, if achieved, it would be the biggest valuation at an IPO in history.”
“Michael Burry believes the AI bubble ‘may burst’ sooner than he first believed…
“The investor, famous for his big short on the U.S. housing market prior to the global financial crisis of 2007 – 2009, is switching to put options from short positions on key AI stocks, giving him more cost-effective leverage over a shorter time horizon, he said.”
“Trump renames AI to ‘super intelligence’ and tells Americans they have no choice but to trust ‘these folks’.
“Donald Trump continued his inexplicable embrace of artificial intelligence on Tuesday as he gave it the ultimate honor — a Trump-style rebrand with the flick of an executive pen.”
“White House Weighs Red-Dyed Diesel Relief as Fuel Prices Soar.
“The White House is considering allowing broader sales of red-dyed diesel, which is largely exempt from federal diesel taxes… U.S. diesel prices reached a record EIA weekly national average of $6.529 per gallon for the week of September 21.”
“‘Is it really worth it to keep going on?’ Economic pain hits America’s farm belt…
“Yeley is the seventh generation to run his farm in Illinois, just over the state line from Indiana. Although he plans to keep doing so, he’s not sure he wants his 16-year-old son and 12-year-old daughter to take over because the current economics are so rough.”
https://edition.cnn.com/2026/09/28/business/american-farmers-economic-pain-diesel
“US ban on Canadian imports likely to weaken already fragile relationship.
“US-Canada relations, already tense, are likely to deteriorate further after the United States went ahead early on Tuesday with a decision to ban nearly $1bn worth of Canadian imports, including alcoholic beverages, dairy products and motorcycles.”
https://www.theguardian.com/us-news/2026/sep/29/ban-canada-imports
“‘Greenland’s ability to choose its industrial and financial partners is now subject to Washington’s approval’…
“This resolution appears to close one of the most serious episodes of transatlantic tension since the end of the Cold War. From the threats of using “the hard way” voiced in January, to the demand for “immediate negotiations” at the World Economic Forum in Davos [late January]…”
“Greenland Energy CEO says ‘The world needs oil’.
“Greenland Energy CEO Robert Price joined CNN to discuss oil markets, Greenlandic sovereignty and concerns of US influence.”
[Interview]
https://edition.cnn.com/2026/09/29/business/video/greenland-energy-ceo-robert-price
“How Britain’s economy collapses, step by terrifying step.
“With huge national debt, the UK is dangerously exposed to our international lenders – which could bring about a nightmare scenario… When the bond markets take fright, that can lead to full-on economic crisis for a nation as precariously poised as the UK.”
https://www.telegraph.co.uk/news/2026/09/28/how-britains-economy-could-collapse-step-by-step/
“France’s public debt soars to a record 119% of GDP.
“French public debt rose again in the second quarter, reaching the unprecedented level of 3,595.5 billion euros at the end of June, the National Institute of Statistics and Economic Studies (Insee) announced on Tuesday 29 September.”
https://www.euronews.com/2026/09/29/frances-public-debt-soars-to-a-record-119-of-gdp
“Public workers in France strike over pay as student protests turn violent.
“Tens of thousands of civil servants, including teachers, firefighters and healthcare workers, have marched in cities across France to demand higher pay, as students clashed with the police in separate protests over conditions at their schools.”
“Spain Approves Emergency Housing Measures to Curb Unrest.
“Spain’s government is overhauling housing rules to head off mounting unrest over soaring costs, after protests swept the country the past week and demonstrators set up camp in central Madrid. The measures include barring companies from buying homes for speculative purposes…”
“Europe’s Gas Crisis Deepens as Hormuz LNG Crunch Drives Prices Higher…
“Since early March, European gas prices have reflected the tight global gas market, with most of Qatar’s LNG supply still offline and no clarity on when some semblance of normal shipping of LNG cargoes would return at the Strait of Hormuz.”
“EU nations seek energy alternatives after spending over $113 billion extra since Iran war began…
““Times are serious,” said EU energy commissioner Dan Jørgensen during a gathering in Dublin of energy ministers from across the 27-nation bloc. Despite the additional money spent, the members haven’t received “one extra molecule of gas or oil.””
“Ukraine Expects No Black Sea Ceasefire in Coming Months…
““Unfortunately, it’s hard to imagine any possible solutions in the nearest months on this issue,” Ukraine Agriculture Minister Taras Vysotskyi said in an interview in Brussels. “We have to really prepare that the situation remains as critical as it is now.””
“Russia warns of nuclear response to any Kaliningrad blockade.
“Russia warned Tuesday that any British or NATO attempt to blockade or strike the Kaliningrad region would be met with a response using all available means, including nuclear weapons… “Those advocating plans to blockade or strike Kaliningrad should have no illusions about the consequences,” the embassy said.”
“Russia Tightens Secrecy On Energy Exports…
“Data on refining volumes at Russian plants is now restricted, along with contract details, including product names, quantities, prices, buyers, sellers, payment terms, shipping routes, and vessel coordinates at export terminals. Customs statistics and planned sales volumes on commodity exchanges fall under the same rule.”
https://oilprice.com/Latest-Energy-News/World-News/Russia-Tightens-Secrecy-On-Energy-Exports.html
“North Korea denies planting mines that injured 3 South Korean soldiers, accuses Seoul of conspiracy.
“The powerful sister of North Korean leader Kim Jong Un on Wednesday rejected South Korean findings that North Korea likely planted the land mines that injured three South Korean soldiers last week. She threatened to retaliate…”
“China rolls out new measures to bolster its property sector and economy.
“China on Tuesday rolled out new measures to help boost its economy and sluggish property sector as pressures ramp up ahead of a year-end target for hitting the government’s economic growth goal.”
“China says Taiwan is ‘desecrating the martyrs’ with its World War Two history criticism…
“Speaking at a weekly news briefing in Beijing, Zhang Han, a spokeswoman for China’s Taiwan Affairs Office, said Taiwan’s ruling Democratic Progressive Party (DPP) was trying to distort World War Two history.”
“The Philippines will reap what it sows [Chinese State perspective].
“From the Middle East to Ukraine, the fallout from regional crises ought to make any sensible person cherish the relative peace and stability in the Asia-Pacific… Their attempts to roil the South China Sea command scant support of peace-loving nations.”
https://www.chinadailyhk.com/hk/article/640279
“Let the Border Be Determined by Law, Not by Claims [Cambodian perspective on Thailand dispute]…
“If Thailand is confident that these areas are unequivocally within Thai territory, why not allow the Cambodia–Thailand Joint Boundary Commission (JBC) to complete its work through the agreed legal and technical mechanisms?”
https://phnompenhpost.com/opinion/let-the-border-be-determined-by-law-not-by-claims/
“Malaysia begins controversial repatriation of asylum seekers to Myanmar…
“Three ships from the Myanmar navy departed from Malaysia on Tuesday carrying the first 1,476 returnees. Human rights groups have condemned the repatriation, saying the returnees could face violence, persecution and forced conscription into the Myanmar army.”
https://www.bbc.co.uk/news/articles/ckj06542e5neo
“Fighting between Pakistan and the Taliban persists into second week.
“The latest round of conflict between Pakistan and the Taliban continued this past week, including airstrikes, cross-border attacks, targeted operations, and a car bombing. The fighting appears likely to continue unless intermediaries can help bring about a ceasefire between the former allies.”
“Iranians stock up on food and medicine as fears of new US fighting grow.
“Tehran’s stores remain stocked, but shoppers are keeping an eye on shop shelves. Their anxiety has deepened since a flurry of social media posts urging people to ensure they have several days of food before a possible new round of fighting with the US.”
“Iraq begins high-stakes security balancing act as US troops withdraw…
“While al-Zaidi has promised continued integration and cooperation with the US and other Western allies, there is likely disquiet behind the rhetoric, Mansour assessed, with some seeing the US’s erstwhile presence in the country as having served as a bulwark against a wider policy pivot.”
“Abu Dhabi’s Crown Prince Is Spending Billions to Bypass Iran’s Grip on Hormuz.
“Weeks before the Iran war began, Abu Dhabi Crown Prince Sheikh Khaled bin Mohamed Al Nahyan took the helm of a $300 billion sovereign wealth fund. Now, months into a conflict that’s reshaped the Middle East, this entity and the people running it have become central to building the infrastructure needed to override Iran’s stranglehold over the Strait of Hormuz.”
“‘Factory of targets’ and ‘collateral damage’: Israeli soldiers describe Gaza methods…
“”The deaths of tens of thousands of Palestinians in aerial strikes across the Gaza Strip cannot be explained by a handful of exceptionally horrific attacks. They are the foreseeable result of the operational standards and policies the [Israeli army] has chosen to implement when fighting in Gaza,” emphasized Breaking the Silence…”
“Yemen’s war disrupts roads and ports, deepening humanitarian crisis…
“After four years of calm, Yemen’s return to violence had arrived at Jabal Habashi, where the Houthi rebels are attempting to advance in government-held areas. The fighting has left civilians, like the 39-year-old Mohammed, afraid of moving around their homes and farms.”
“US warns Houthi ties with al-Shabaab threaten Red Sea trade.
“Strengthening ties between the Houthis and al-Shabaab militants in Somalia pose an “escalatory” threat to regional stability, US officials have warned, as Yemeni rebels battle to consolidate control over the Red Sea coast following a string of recent victories.”
https://www.ft.com/content/c81d0739-5ff6-45fb-aed5-5c5f67729925?syn-25a6b1a6=1
“Somali pirates killed five crew members on hijacked tanker, officials say…
“They appear to be the first deaths at the hands of Somali pirates in more than a decade and come amid a resurgence of Somali piracy that experts have attributed in part to the effects of the United States and Israel’s war on Iran.”
“Ethiopia blames regional rivals as risk of conflict spillover rises.
“As renewed fighting spreads across northern Ethiopia, the government has accused Eritrea, Sudan and Egypt of backing armed opposition groups, raising fears that the conflict could draw in regional powers.”
“More than 80 reported abducted in Nigeria as police find human remains…
“At least 47 farmers were abducted by armed men while harvesting peanuts in the northern Niger State on Saturday, while 40 women were kidnapped in the neighbouring state of Zamfara on Sunday, the agency reported, citing two security reports and a local source.”
“Falkland Islanders grapple with Argentina’s ‘economic warfare’…
“Argentina has expanded sanctions targeting travel connectivity, including penalising firms like Thales UK for operating unauthorised flights, alongside ongoing restrictions on airspace use and charter flights connecting South America to Stanley.”
https://www.ft.com/content/729662bd-0f6e-42a7-a54a-55c306c1f37e
“Power outages, the economic crisis, and the blockade against María Corina Machado reignite social protests in Venezuela.
“A military contingent blocked the bridge over Lake Maracaibo on Monday in the Venezuelan oil capital to prevent a workers’ protest from closing the road. In Guayana, in front of the state-run basic industries, workers erected a barricade to demand better wages.”
“Colombia seeks IMF aid amid fiscal ‘crisis’.
“Colombia’s new government has opened talks with the International Monetary Fund (IMF) to secure alternative financing at more favourable rates as it grapples with what officials call the most critical fiscal crisis in the nation’s history.”
“Peruvian Armed Forces Force Colombian FARC Dissident Group to Retreat.
“So far, the most porous borders through which criminal organizations infiltrate have been those with Venezuela and Ecuador. In Venezuela, the leaders of the ELN and the FARC dissident group Segunda Marquetalia are presumed to remain.”
“How gold surpassed cocaine as Peru’s most profitable criminal industry.
“As gold prices surge, illegal mining has laid waste to swathes of Tambopata National Reserve’s rainforest… “Dirty” gold has become the country’s most profitable illicit industry, even surpassing drug trafficking in the world’s second-biggest producer of cocaine after Colombia.”
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You can read the previous “Economic” thread here. I’ll be back tomorrow with a “Climate” thread.
https://www.bloomberg.com/news/articles/2026-09-28/fidelity-pushes-germany-to-widen-market-friendly-pension-reform
“We are advocating for the new private pension solution to be opened up as an avenue for occupational pensions,” said Jan Schepanek, head of private client business at Fidelity International in Germany.
“We can play a significant role in this market, given we’re present all along the value chain for this product,” he said in an interview. “The ambition is to be in the top five.”
…It’s unclear when the changes would be implemented, not least because Chancellor Friedrich Merz’s party is still reeling from a string of defeats in regional votes.
The product features an early de-risking period in which exposure to equities is reduced before retirement as well as active exchange-traded funds that can offer better returns than passive ETFs, said Oliver Dreiskaemper, head of proposition, product and change in Germany at Fidelity.
And by “before retirement” they mean the bright young age of 70. Keep in mind, these are the “leftists” who are desperately fighting against the Bad Guys who want to plunge all of Germany back down into the fiery pit of fascism. Needless to add the “Bad Guys” will implement these same reforms under different labels/justifications if/when they sweep federal elections.
Every stage of history is governed by a big lie. Our lie is that the left and right are opposite forces. In fact they are the same force, forced to exist in a state of perpetual “culture war” with itself because the alternative is to speak plainly and delegitimize itself. Fascism’s defeat was remarkable quick compared to other counter-revolutions in modern history, and normal social democratic service resumed soon thereafter. This, on the other hand, is barely the tip of an astronomical collapse-berg.
“Our lie is that the left and right are opposite forces.”
Jupiviv, my half-baked thought on this is that it is the tension between the political polarities that allows for a “healthy” democracy. When there is insufficient surplus energy, that tension unravels. The polarities push further apart with chaotic splintering in between. Politics turns dysfunctional, as we are seeing now.
Here in the UK, Andy Burnham wept yesterday as he announced the end of the “triple lock” pension, which guaranteed that the state pension goes up each year in line with inflation or wage increases or 2.5% (whichever is the highest).
https://www.theguardian.com/politics/2026/sep/29/andy-burnham-labour-conference-pension-triple-lock-social-care
The Right of Way
The reports from Yemen, Somalia and Ethiopia appear to describe separate conflicts. In Yemen, the war is flaring up again and roads and ports are becoming harder to access. Across the Gulf of Aden, Somali piracy is returning. The United States is warning of contacts between the Houthis and al-Shabaab. Further inland, the violence in Ethiopia threatens to spread to neighbouring countries.
On our world map, all these events are taking place around one of the world’s most important logistical corridors. Bab el-Mandeb and the Red Sea provide the link between the Indian Ocean and the Suez Canal. For Europe and Asia, this is part of the system’s infrastructure. Oil, fuels, containers and raw materials are expected to pass through it as cheaply and predictably as possible.
But why should the parties living and fighting around this corridor use the same map?
For a Yemeni farmer, a blocked local road matters more directly than the additional sailing time of a container ship bound for Rotterdam. For an armed group, control of a stretch of coastline, a port, a border crossing or a mountain pass is an instrument of power. For Somalia, the enormous amount of value passing its coast every day does not automatically translate into a corresponding amount of local economic value.
In short, two different maps lie over the same territory.
For a long time, the global economy has been able to assume that the second map would conform to the first. But maintaining that arrangement required navies, coastguards, military bases, diplomacy, insurance, international aid and sufficient state power to keep local infrastructure usable. As that maintenance becomes less effective, it becomes clear how little about the global logistical order can actually be taken for granted.
A strait does not even have to be physically closed for this to happen. A relatively small local disruption can produce a much larger systemic disruption.
The return of Somali piracy is a good example. Not because pirates can control global trade, but because the efficiency of global trade depends on the assumption that such local risks will be sufficiently suppressed.
The same tension appears in Ethiopia. For the global economy, the connection to Djibouti is a logistical corridor. For the parties in the region, that same road runs through the political landscape of Ethiopia, Afar, Tigray, Eritrea, Sudan and Egypt.
The mistake we make is to regard our logistical map as reality itself. From Rotterdam, Bab el-Mandeb is a vital trade route that must remain open. From within the region, it is a stretch of sea between two coasts where local and regional struggles for power are being fought out.
The map of our global trade runs through other people’s backyards, without a right of way.
Zip, thank you for the interesting essay.
The Red Sea is becoming a graveyard of superpowers, like Afghanistan. The US rolled over and let the Houthis run amok because they lacked the military muscle to do much about it. The humiliation of the Suez Crisis was a death knell for the British Empire. The Ottomans and Portuguese also got their fingers burnt there.
A Few Notes on Fragmentation, Simplification and Unpredictability
We live in a time when fragmentation is acquiring a more precise meaning than simply “the system is falling apart.” No predetermined, simpler order emerges to replace it.
The integrated system had one dominant route map: cheapest producer → efficient refining/processing → cheapest transport corridor → global market → consumer. That map could be enormously complex, but its organising logic was relatively uniform: price, scale, reliability and flow.
With fragmentation, other organising criteria intervene: national security of supply, military control, sanctions, local power, insurability, protection of domestic populations, and the availability of ships, ports and fuel. As a result, every actor begins to draw its own route map.
These maps then begin to affect one another. If US diesel becomes more difficult to export, European buyers look for other suppliers; those suppliers have to divert products from elsewhere; tankers are given different destinations; refining margins change; other types of crude become more attractive; ports and pipelines face different loads. Nobody designed this new world map. It emerges from thousands of local adjustments.
That is what makes prediction so difficult. It is often possible to predict reasonably well what one actor will rationally try to do, but much harder to predict what new order will emerge once all the other actors have responded.
Bab el-Mandeb provides a good example. The simple route map says: Red Sea unsafe → ships reroute around the Cape of Good Hope. But once large numbers of ships do so, sailing times, bunker fuel consumption, available tonnage, freight rates, port congestion and insurance costs all change. Trade flows then begin to change as well, because some goods can economically absorb the longer route more easily than others. The detour ultimately changes what is being transported.
And that brings us back to my objection to simplification. Fragmentation does not produce the same system with fewer connections. It creates new connections, new nodes and new dependencies, while others disappear.
The map does not become simpler. Different maps emerge simultaneously, partially overlapping and constantly changing.
Your thoughts are very closely aligned with mine on the complex way in which global civilization collapses, not by simply reverting to a multitude of actually workable local models but through changes in the relationships between thousands of “local” nodes to the needs of the malfunctioning global system they constitute. That these changes appear to be a process of fragmentation indicates the contradictory nature of capitalist globalism – an un-planned, wasteful, violently competitive system which is paradoxically also dependent on an historically unprecedented degree of globally connected and coordinated activity.
I think I mentioned before that this growth of new connections reminded me of the less efficient but more complex collateral circulation that can form in an organism to compensate for blocked veins.
Actual fragmentation will occur when the organism/civilisation dies/collapses, basically.
Here’s another one for the “we told you so” pile of human insanity: the Saudi’s Neom project. Never was there such a disgusting, insane, humongous example of hubris and ecological lunacy. We saw this as soon as it was announced almost 9 years ago.
https://m.youtube.com/shorts/DIUJ1M_J9wg
Omg…SO ridiculous…How is it that the folks with the most money can never put it to good use?
Because maybe the money is fake? Because it’s essentially a claim on future energy that’ll never materialize? People pay too much attention to bullshit such as above while forgetting the basics.
It is quite Ozymandian. Saudi must be rueing the money they’ve spent on it, now that they are embroiled in expensive wars directly and by proxy.
The video doesn’t mention it but a year-round ski resort(!) was supposed to be constructed there, too.
“Kazakhstan will replace Saudi Arabia as the host the 2029 Asian Winter Games… The 2029 Asian Winter Games had originally been planned to be held in Neom, a planned city and mega-project on the Red Sea in northwestern Saudi Arabia… The postponement was confirmed after Riyadh appeared to try to push back the delivery of the ski resort.”
https://www.dw.com/en/saudis-neom-replaced-by-almaty-as-asian-winter-games-host/a-75851615
People who keep winning at a rigged game get stupid pretty fast.
Or to put it otherwise; easy success degrades critical thinking. When a system is rigged in someone’s favor, they no longer need to adapt, problem-solve, or learn from failure. They begin to mistake environmental bias for personal genius.
KSA elite suffers from illusion of control, skill atrophy, risk blindness and failure to pivot.
When the environment stops challenging you, you must challenge yourself. KSA elite missed that one. That’s why they’re such a bunch of messy bitches; lots more infighting to come in that family.
Pan we finally made it to a real liquor store. Picked up a couple of bottles of Islay Mist. They had Lagavulin but that was way outside our budget. How much does the Lagavulin cost if you buy it on island?
Cheers
Duke, there aren’t actually great savings to be made buying whisky on the island. Most of the distilleries are now owned by big corporations (Diageo in Lagavulin’s case), which are not flexible in their pricing. I think an 8-year-old would set you back something like £60 in the distillery shop.
It’s definitely not a good time to be investing in whisky. There is a glut of the stuff and the industry is struggling:
https://www.theguardian.com/food/2026/sep/29/scotch-distilleries-pause-production-whisky-loch-scotland