MisbehavingEconomist

Behavioural Economics (Herb Simon school)
Complex choices in education under Shacklian uncertainty
+ backyard sustainability & produce

[MisbehavingEconomist @MisbehavingE]

@onechancefreedm US is being suckered by a long con. Iran will use this to take out the Gulf States which will then be absorbed by Saudi Arabia. US gets ejected from Iraq which gets split between Iran & Turkey. Creating a Saudi/Turkish/Irainian troika controlling all Middle East oil & gas.

[Mohamed A. El-Erian @elerianm]

From John Plender's FT column:
"At the same time, Treasury funding is increasingly reliant on shorter-term securities, which means constant rollover risk. With US public debt approaching its highest ever level, this combination sounds like the very definition of a non-geopolitical financial chokepoint, with vulnerability to shocks. It also suggests there are now systemic risks in the Treasury market."
#economy #markets #bonds

[Hedgie @HedgieMarkets]

🦔Blackstone just capped withdrawals from its $79 billion flagship private credit fund BCRED at 5% of shares after redemption requests hit 10% in Q2. That's up from a then-record 7.9% in Q1. Switzerland's Partners Group is also restricting redemptions in a European private equity fund and warned the withdrawals are now spreading from private credit into private equity.
Pimco's CIO Daniel Ivascyn said last week that higher losses are coming and the industry is in "the first sustained default or loss cycle in many, many years." Blackstone's COO called the withdrawal caps "a feature, not a bug."

My Take
Redemption requests went from 7.9% to 10% in one quarter. Blackstone covered Q1 by raising their cap and tapping employee capital, and still had a net outflow. That's not sustainable. Partners Group is seeing the same pressure in Europe and used the word nobody in private markets wants to hear. The withdrawals are spreading. Credit into equity. A $150 billion firm warned its own investors that this isn't isolated.

Private credit has quietly financed a lot of the AI buildout. SoftBank's $40 billion bridge facility, leveraged data center deals, the infrastructure bets behind every hyperscaler's capex forecast. If the funds behind those bets start gating withdrawals because investors want out faster than the assets can cover, the capital pipeline that supports AI spending tightens fast. SpaceX just launched the largest IPO in history. Anthropic filed its S-1. Both need public markets to pick up where private capital is pulling back. The private side of this market is showing stress at the exact moment the public side is being asked to absorb trillions in new AI valuations. That's a bad combination in my eyes.

Hedgie🤗

[MenchOsint @MenchOsint]

As suggested yesterday, the US unsuccessfully tried to escort Oil Tankers through the Strait of Hormuz, risking the lives of the mariners for media victories.

Overnight, 4 oil tankers guided by the US Air Force, without coordination with the IRGC Navy, attempted to exit the Strait of Hormuz.

One of the tankers was hit and stopped, and the other vessels turned back.

Then at 2h30, US drones hit a telecommunications mast in Qeshm and a radar in Sirik with two projectiles.

In response, IRGC targeted Ali al-Salem air base in Kuwait and the the US Navy's Fifth Fleet in Bahrain with Ballistic Missiles.

[James Melville 🚜 @JamesMelville]

While we get threatened with hosepipe bans whenever there’s a week of sunshine, it is estimated that Al data centres will consume water equal to the needs of 1.3 billion people by 2030.

[zerohedge @zerohedge]

There's more: "Meta’s Big Tech rivals such as Microsoft and Amazon are also likely to be considering their own stock sales" - FT

[First Squawk @FirstSquawk]

IRAN THREATENS FULL STRAIT OF HORMUZ SHUTDOWN AFTER MISSILE ATTACKS ON U.S. BASES

#BREAKING

[zerohedge @zerohedge]

IRAN GUARDS SAY TARGETED US BASES IN GULF: AFP

IRANIAN STATE TV CLAIMS MISSILE STRIKES ON U.S. BASES IN KUWAIT AND BAHRAIN

IRGC CLAIMS IT FIRED ON FOUR TANKERS IN STRAIT OF HORMUZ

[Meriwether Farms @MeriwetherFarms]

BREAKING: USDA confirms a SECOND New World Screwworm case in Texas, 5.6 miles from the first case

[MisbehavingEconomist @MisbehavingE]

@SincDavidson Australian universities are inefficient because 'executive' level (VCs, DVCs etc) has no 'skin in the game'.

[International Cyber Digest @IntCyberDigest]

❗️🚨 An Israeli company has backdoored hundreds of millions of households through countless Smart TV apps, and they're quietly turning Samsung and LG TVs into exit nodes for AI web-scraping. Your TV is relaying strangers' web traffic from your home IP, your bandwidth, your address attached to whatever those scraping jobs touch.

Roku, Fire TV and Google TV banned the practice. Samsung and LG didn't. The culprit is Bright Data's proxy SDK, which rides inside Tizen and webOS apps, 200+ on webOS alone. Datacenter IPs get blocked, home IPs don't.

Include Security reverse-engineered the SDK and found its relay protocol has no message signing, authentication, or device attestation. Their words: less secure than typical malware command-and-control.

To make things worse, they found that in iOS the relay tunnel binds straight to the physical network interface, so it routes around any VPN the user is running.

Bright Data's config also ships per-country tiers. Devices in Uzbekistan and Oman are cleared to relay down to 1% battery, with data caps up to 60x the worldwide default.

Before the BaCkDoOrEd replies land: technically you agreed. In practice you were enrolled into a global proxy network you were never given the information to refuse. And these exit nodes drag down your IP's reputation, potentially leaving you with blocks from providers.

[Faytuks Network @FaytuksNetwork]

Sirens are now sounding in Bahrain.

[Flightradar24 @flightradar24]

Flights bound for Kuwait are currently holding or diverting amid reports of Iranian strikes. https://t.co/98oT8bjr4Z

[MisbehavingEconomist @MisbehavingE]

Mainstream politicians are leading Australia into a Farage-style earthquake: 'Pauline Hanson’s insurgent populist movement says it now has more signed up, fully paid members than either Labor or the Coalition.'
https://t.co/OOsVWXbI13

[JustDario @DarioCpx]

Told ya this was coming

[MisbehavingEconomist @MisbehavingE]

@DarioCpx When big tech rush to raise equity you know bottom is falling out the credit market.. we're almost there..

[Mario Nawfal @MarioNawfal]

🚨🇮🇷 BREAKING: The picture of tonight's strikes inside Iran is firming up.

Explosions are now reportedly confirmed on Qeshm Island and in the Sirik and Garuk area of the southern coast, while the Kharg Island scare turned out to be false.

Local sources also report at least 4 to 5 blasts near the Sirik naval base, home to IRGC fast boat forces, though that count remains unconfirmed.

Source: CENTCOM / Geopolitics on TG

[Douglas Macgregor @DougAMacgregor]

US takes out Iranian coastal surveillance radar sites in Qeshm and Goruk.

Peace talks have fallen apart.

[Fey @fey_xbt]

A guy calls his broker and asks about egg futures.

Broker says they’re at 25 cents.

Guy says, “Alright, buy me 100 contracts.”

A week later he calls again.

Broker says, “Good call. They’re at 35 cents now.”

Guy gets excited and buys 1,000 more.

Few days later, he calls again. Eggs are at 50 cents.

Now he thinks he’s a genius, so he buys 100,000 contracts.

Next day they’re at 65 cents. He buys a million.

Then they’re at 95 cents. He buys another million.

Then $1.25. He buys another million.

Next day, eggs are trading at $1.75.

He finally thinks, alright, this is probably enough. Time to take profit.

So he tells his broker, “Sell 2 million contracts.”

After a long silence, broker finally says:

“Sell to who? You’re the egg guy.”

[Ayaan 🐧 @twtayaan]

The creator of Linux just publicly called out the AI hype. Word for word.

Linus Torvalds took the stage at Open Source Summit 2026 and said this:

"When I see people saying 99% of our code is written by AI, I literally get angry. Because those same people — I can pretty much guarantee — 100% of their code is written by compilers. But they never say that."

He is not anti AI. The Linux kernel saw a 20% jump in submissions this release because of AI tools. He uses it. He gets it.

His point is something most people are too afraid to say.

AI is a productivity tool exactly like compilers were. Compilers boosted programming by 1000x. AI adds another 10x on top. Enormous. But nobody says "the compiler wrote my code." So why are we saying AI wrote it?

He also flagged something nobody is talking about.

AI is flooding small open source projects with drive-by bug reports. Someone runs a prompt, files a report and disappears when asked for a patch. Maintainers with one or two people are drowning trying to keep up.

"Sometimes AI reports a bug and when you ask for more information the person has done that drive-by and does not even answer your question. That is the real burnout issue."

And his final warning was the sharpest of all.

"People who do not understand the complexity of systems will prompt systems and write processes that will fail."

The AI hype crowd is very loud right now.

Linus has been building real systems for 35 years. When he talks, engineers listen.

Full interview here:
https://t.co/LmXJtvKc4O