David Houchen

Day job is banking; interests include energy, investing and geopolitics

[Art Berman @aeberman12]

Hormuz Is Not About the Tolls

It is about who grants permission to pass.

If Iran emerges as the recognized manager of the world’s most important oil chokepoint, the U.S. has lost part of the maritime power that underwrote its global hegemony.

The emerging dispute over tolls and fees in the Strait of Hormuz risks obscuring the larger geopolitical reality.

The money is not the main issue. Whether Iran ultimately collects 3%, 5%, 7%, or almost nothing may matter far less than whether Tehran is formally recognized as the manager of the world’s most important energy chokepoint.

That appears to be the real prize.

For decades, freedom of navigation through Hormuz was treated as part of the maritime order guaranteed by the United States. That role was central to the post-World War II “Grand Bargain”: Washington protected global trade routes and, in return, the world accepted a system organized around American power, American financial institutions, and the U.S. dollar as the principal reserve currency.

The Iran war may have fundamentally altered that arrangement.

The United States entered the conflict insisting that Hormuz would remain open and beyond Iranian control. Five months later, military pressure has not broken Iran’s grip on the strait. Washington appears unwilling—or perhaps unable—to restore the old status quo by force. The emerging agreement instead contemplates Iranian authority over inbound traffic, monitoring rights, and possibly fees.

That is not a technical compromise. It is a strategic concession.

Rory Johnston is probably right that Tehran may ultimately care more about recognition than revenue. The geopolitical value lies in establishing that ships pass through Hormuz with Iranian permission. Once that principle is accepted, the question of how much Iran charges becomes secondary.

Iran will not concede Hormuz because it does not have to. It has demonstrated that it can impose intolerable costs on Gulf energy infrastructure, commercial shipping, and U.S. regional allies while absorbing months of American and Israeli attacks. Washington, meanwhile, has discovered that controlling a chokepoint is easier to declare than to enforce.

The implications extend well beyond the Gulf.

Henry Kissinger is often credited with saying, “Control oil and you control nations.” The United States does not directly control the world’s largest concentration of oil supply, of course, but for decades it controlled the security architecture that allowed those barrels to reach world markets. That distinction is now narrowing.

Iran may not control every barrel produced in the Gulf, but it has shown that it can determine whether much of that oil moves—and on what terms.

That marks a major change in the regional balance of power and a serious geopolitical defeat for the United States. It also suggests that the slow transformation of the liberal international order has taken a sudden leap forward.

The dollar will not lose its reserve-currency status tomorrow because Iran manages traffic through Hormuz. Reserve currencies rest on deep capital markets, legal institutions, liquidity, and network effects. But the maritime order and the monetary order have always been linked by American power.

If the United States can no longer guarantee freedom of passage through the world’s most important oil chokepoint, then one of the foundations of that power has weakened.

The tolls are merely the detail.

The real issue is that the guardian of maritime trade has been forced to negotiate with the gatekeeper.

#Hormuz #Iran #UnitedStates #Oil #Dollar #Geopolitics #MaritimeTrade
https://t.co/t7fpVAttJJ

[Darius Dale @DariusDale42]

CORRECTION: Dale 2048 🇺🇸. I have young children whom I would like to see grow up before I get assassinated.

FWIW, throughout history, people who “red pill” the system tend to get assassinated: the Gracchi brothers, Abraham Lincoln, Mahatma Gandhi, Huey Long, JFK, MLK, etc.

THEY—the billionaires and trillionaires who have purchased controlling stakes in Congress, the White House, the Supreme (and lower) Court(s), AND THE MEDIA—have a deeply vested interest in preventing the following:

1. Campaign finance reform so that every citizen’s vote actually counts as one vote, rather than preserving the current system whereby the top 1% pay top dollar to rig election outcomes, legislation, and regulation on their behalf AT OUR CHILDREN’S EXPENSE.

2. A single flat tax that treats every dollar of realized income the same.

3. No tax loopholes to favor certain activities and interests, or to promote certain behaviors. As far as I’m concerned, the desire for people to procreate with desirable partners and take adequate care of their families—both while alive and posthumously—is genetic. You don’t need to corrupt the tax code to promote these outcomes. Human beings will do these things regardless of whether there are tax “incentives” for them—which we know largely favor the rich.

4. Trust-busting to reduce the power of monopolies, duopolies, and monopsonies over our economy and promote inclusive innovation.

5. Mandating that the Fed target stability in the US dollar vs. a basket of commodities or a neutral reserve asset like gold, OR removing the Fed’s “maximum employment” mandate—the mandate that causes it to consistently justify debasing our currency and perpetuating the historic Cantillon effect that is destroying our society—if returning to a harder currency regime is too painful.

These are the kinds of “radical” (read: common-sense) ideas that can get me killed if I’m not careful—hence waiting until 2048.

“The Lord is my strength and my defense; he has become my salvation.”
—Exodus 15:2

Jesus Christ and I love you and your children. Change your attitude towards our corrupt political system for them before it’s too late.

Reminder: The US has already fought a violent, bloody revolution and a violent, bloody civil war because The People have generally agreed with me and not with The Privileged Few. Unfortunately, history confirms that revolutions and wars are ALWAYS much worse for BOTH sides than everyone realizes at the outset.

I believe God pulled me up from the bottom 0.001% of the K-shaped US society to bring glory to Him by helping prevent this tragic outcome—or by helping our wonderful nation heal after it. I pray every day that I’ll be successful in either mission.

With love,
—Skipper ❤️+🤍+💙=💜

[David Houchen @dhouchen]

Let’s hope this escalation does not come to fruition.

[Patricia Marins @pati_marins64]

Retaliation Targets: Iran Lists Sites That Would Trigger a Major Global Crisis

Rumors indicate that Trump, together with Netanyahu, is preparing to resume intense bombing of Iran, this time focusing heavily on civilian infrastructure.
Iran, for its part, has released a list of targets that could collapse the economies of Israel, Jordan, and the Gulf states if it is attacked.

The United States and Israel appear to calculate that the operation will be so intense that the Iranians will be unable to do much more than they did during the previous 40 days of war.

Netanyahu is confident and is already breathing the possibility of his own political survival.

But what about the Gulf countries? Trump and Netanyahu tried every available means to drag the GCC states into their war, without success. With the proven exception of the Emirates, these countries limited themselves to political pressure.

Trump used the period of relative calm to pull Israel back from the front line and work on bringing the GCC into the conflict, still without success.

Continuous and simultaneous operations by the Gulf states against Iran was the second front Netanyahu and Trump dreamed of. It has not materialized. It has not materialized yet, because the Iranian target list will hit the populations of these countries hard and will once again pressure their governments to reconsider that decision.

The truth is simple: the greater the destruction, the smaller the chance of future reconciliation, and the higher the likelihood that the GCC will pivot toward the Abraham Accords. 

The list of targets Iran has threatened to strike if the coalition attacks its territory includes:

Saudi Arabia
Ras al-Khair complex: one of the largest hybrid power-generation and desalination plants on the planet.
Shuaiba plant: a mega-facility on the Red Sea coast.
Jubail complex: a vital cogeneration facility that supplies the capital, Riyadh.

United Arab Emirates
Jebel Ali complex (Dubai): a massive desalination and power plant located near the port.
Taweelah complex (Abu Dhabi): a large reverse-osmosis desalination plant.
Fujairah F1 / F2: critical installations on the country’s eastern coast.
Barakah Nuclear Power Plant: included on maximum-retaliation lists.

Kuwait
Doha West complex: the massive plant that supplies the majority of Kuwait’s electricity and residential water.

Bahrain
Integrated coastal water co-generation plants that supply the island.

Qatar
Ras Laffan complex: the main industrial hub for processing, power generation, and LNG exports.

Jordan
Water-supply infrastructure: included because of the country’s logistical cooperation with Western forces.

If these targets are hit, they will trigger an economic, social, and environmental crisis across the region, a scenario I am not even capable of fully imagining.

By a bitter irony for Netanyahu, a successful Iranian strike against the listed targets in Israel, which are few, would also paralyze Israel’s basic functioning, producing an immediate systemic collapse of its electricity, water, and economic networks. 

Continue reading:
https://t.co/WylTLIReb2

[David Houchen @dhouchen]

@DariusDale42 Lots of truth in this post. Both R’s and D’s work against us at the federal level

[Art Berman @aeberman12]

The largest oil supply disruption in modern history—and crude still shows little urgency.

Markets are not pricing today’s lost barrels.

They are pricing the probability, duration, and inventory consequences of tomorrow’s scarcity.
👇
https://t.co/qMywaWHfVU

#Oil #Energy #Markets #Futures #Inventories #Hormuz

[Charlie Bilello @charliebilello]

1. Stocks: all-time high
2. Home Prices: all-time high
3. Bitcoin: all-time high
4. Gold: all-time high
5. Money Supply: all-time high
6. National Debt: all-time high
7. CPI Inflation: 4% per year since Jan 2020, 2x the Fed's "target"
8. Fed: cutting interest rates next month

[David Houchen @dhouchen]

Post of the day . . .

[Darius Dale @DariusDale42]

Happy Juneteenth #Team42!

Today is a day on which we ought to sit and reflect on the country we have been, the country we are, and the country we want to be.

I believe that deep down, America is a godly country based upon godly principles. In an era of kings and feudal lords, it was radical to think that all people are created equal and that we all deserve liberty, the pursuit of happiness, and representation in government. Looking around the world, it still is a radical thought in many places. And in many cases—both present and past—these formerly radical principles have not applied to everyone here.

Looking ahead, the country I love so much is clearly at a crossroads. But we have been here before. And if we conjure the spirit of the great godly men and women of yesterday, we can navigate this Fourth Turning polycrisis relatively well.

There will be some pain involved, but the juice is worth the squeeze. Because I do not want my children to grow up with crippling inequality and widespread poverty, which leads to rampant crime and government overreach, political chaos and inflation, and eventually, a crumbling empire. That is the risk if we allow our increasingly K-shaped society to fester.

Here are my top five institutions that I believe will be up for serious debate and potential regime change as we trudge deeper into this Fourth Turning: 

1. The egregiously unfair treatment of capital income vs. labor income in our ultra-complicated tax code which features tens of thousands of pages of loopholes for rich people and corporations to weaponize and evade taxes at the expense of burdening poor people with more national debt. 10% flat tax anyone? I know God is in favor of it—it’s well documented in the Bible. 

2. The cultural obsession with putting profits over people. AI is bound to take our capitalism experiment to its logical extreme—and no economic system functions well for society at the extremes. Capitalism is not unique in this regard; we just haven’t gotten there yet. But we will in the next 5-10 years. Just watch. 

3. Globalization is another institution that is already being debated in this Fourth Turning. The low-hanging-fruit reason why is because of the adverse distributional impacts it has had on the US labor market and American society broadly—yet another example of putting profits over people. The high-hanging-fruit reason why is that we have lost faith in our own government’s ability to govern and keep us safe. How then can we trust the world beyond our borders? 

4. The size and scope of the money the federal government spends on entitlements (46% of total) and the peculiar ratio between what it spends on poor people (17% of total) and everything else (37% of total). The fight about this will get so intense that it will either destroy one of our two dominant political parties or it will force a third party to emerge as a dominant player. FWIW, I vote purple and am looking forward to the day where the loud voices on @FoxNews, @MSNBC, @Newsmax and @CNN finally realize that it’s counterproductive to keep screaming and pointing fingers at the other side—which is exactly what our oligarchic puppet masters prefer. Better us angry at each other than them. 💜

Thread: 1 of 2

[David Houchen @dhouchen]

Michael Every’s daily summary of geopolitical developments is a must-read.

[Michael Every @TheMichaelEvery]

2025, day 83

Good morning from Asia.

Trump family members plan a trip to Greenland, and some Danes call for them to be barred, as VP Vance says, “Denmark, which controls Greenland, is not doing its job, it’s not being a good ally. If that means that we need to take more territorial interests in Greenland, that is what President Trump is going to do. Because he doesn’t care about what the European scream at us.”;

Underlining how talk is cheap and fast rearmament isn’t, Sweden —one of Europe’s more credible military forces— sees its planned timeline for two new submarines, which had already incurred a five year delay, now sees 2028 delivery slip to “later than 2031”;

China is floating itself as a Ukraine peacekeeper, which could force Europe into some uncomfortable choices;

The U.S. insists on a full Iranian dismantlement of its nuclear program, not just scaling back of uranium enrichment; as reports have Iran militarising the Strait of Hormuz - a gun-to-own-head threat that could disrupt global energy markets hugely, via higher insurance premiums even before any firing starts; as Iran and Russia cooperate on producing electronics;

Turkey, in political turmoil after the arrest of an opposition presidential candidate, has banned short selling of stocks;

Israeli PM Netanyahu, also facing a constitutional crisis and street protests, huddles with defence ministry officials over Turkey’s expanding military footprint in Syria and aid to the new Islamist government. Local media reports a source saying direct Israeli-Turkish “friction” in Syria is unavoidable;

The FT notices “ships are the new chips”, as Bloomberg warns of a “trade apocalypse”, given the USTR holds public sessions today over proposed port fees for Chinese-built and operated ships in fleets of those who make calls in the U.S., and on export quotas for U.S. exports on U.S.-flagged, crewed, and —soon— built ships. (See this for more: https://t.co/lGNWdn1lwY);

The FT worries the U.S. is losing its “exceptionalism”, as stocks and the dollar fall in tandem. Have they seen what some big EM are doing?; and

Some European central bank officials reportedly worry they can no longer rely on Fed swap lines in a crisis. Or rather, they can probably no longer rely on *apolitical* swap lines. There will be a quid pro quo for the dollars pro quids & euros; as

“Don’t fight the Treasury” is the new mantra for some. You mean there might be a correlation between a U.S. admin embracing radical economic statecraft and the key market pivot point they openly say they are now focused on? 😱

[David Houchen @dhouchen]

@AjHildreth AJ, way to GOOOOOOOO!

[David Houchen @dhouchen]

In the latest twist in the ongoing CTA small business reporting saga, reporting is back to “not required” after being required as of Dec 23

[NFIB @NFIB]

NEW: The U.S. Court of Appeals has reinstated the nationwide injunction that blocks the beneficial ownership information reporting requirement. #Smallbusinesses are not currently required to adhere to this burdensome regulation.

Continue the fight: https://t.co/Nne5V1piEI

[Rany Jazayerli @jazayerli]

The Chiefs went on the road against a 1st-place team and won by 19. Missing the best DT in football, they got 5 sacks and 2 turnovers. Since Hollywood Brown returned the offense has been a machine.

I'm actually kind of sad they won't play a meaningful game for at least 24 days.

[The Money Cruncher, CPA @money_cruncher]

If you have an LLC or Corporation, you must register it with the Financial Crimes Enforcement Network (FinCEN) before January 13, 2025.

Penalties for not filing are $500 PER DAY.

Here's everything you need to know (and how to file):

[Seth Keysor @RealMNchiefsfan]

Patrick Mahomes should be in the MVP conversation.

To say otherwise is to ignore that he's the best 3rd/4th down QB in the league by a mile on a team that has had chaos around him at WR (injuries) and LT (poor play and then injuries).

[David Houchen @dhouchen]

Some facts for the Chiefs haters

[#MrAccountability @GandalfStaff]

Since Mahomes became starter in 2018, the Chiefs have been penalized for 911 more yards than their opponents. Only the Saints have a worse penalty yard differential (- 1,092 yards).

They also have 2nd worst penalty yard differential in the 4th quarter of games that were decided by 7 points or less since 2018.

I am once again begging NFL Twitter to stop telling themselves what they want to hear and actually know the facts.

[Mike Sylvester, CPA @FortWayneCPA]

I just watched two hours of the annual Intuit investor meeting and the Q&A at the end was very interesting.

Poll question at the end.

Please repost this thread so we can gather a lot of opinions about Intuit.

What a change... I actually remember back when Intuit was a partner of my firm. Those days are long gone. In fact, they no longer claim that.

I wanted to talk to our Lacerte Rep about these changes and they would not talk to me about it; they said they had nothing to do with the other side of Intuit.

They talked about accountants, tax pros, payroll experts and bookkeepers a lot and they said over and over:

They say we are too expensive and they will disrupt us by being cheaper than us. In fact, they claim to be the cheapest option for assisted tax. Note looking at what many other firms charge this is simply not a true statement by Intuit in many cases.

They say our pricing is opaque.

They say we are slow and it can take weeks to prepare income tax returns.

They say the market is large and disaggregated due to a large number of tax pro firms.

They say we use manual processes.

They say they are going to take bookkeeping clients from us with QuickBooks Live.

They are going to take tax clients away from us with TurboTax live.

Note they are bragging about this and very proud of what they plan on doing. They had nothing nice to say about their former partners; not one thing.

They are going to launch a massive marketing campaign online, within QBO, and everywhere they can to market their new services.

All of us need to know what is coming. Intuit is a big and powerful player. It is worth your time to go and watch Intuit's 2024 Investor Day presentation from September 26th, 2024.

It is pretty much a declaration of war against their former partners and Pro Advisors.

I am all about competition and Intuit can bring it on. I have found their tech support to be relatively poor recently, their customer support poor recently, their prices increases are constant and large, and I spend a ton of time each year fixing returns self prepared in TurboTax.

I actually appreciate that Intuit is being honest that their goal is to take clients from their former partners!

Their football ad saying they will beat the price of your current Tax Pro is interesting and they are spending a ton of money on that marketing.

Be honest, what do you consider Intuit today?

#intuit #cpa #ea #Bookkeeping #bookkeeper #payroll #accountant #accounting #aicpa

[📽️ Red Tribe Cinema @ClayWendler]

Look at that beautiful dynasty.

[Military History Now @MilHistNow]

On this day in 1781, American and French troops under the command of George Washington surround the British at Yorktown. The redcoats will hold out for 21 days before surrendering after which the Crown will open negotiations to finally end the War of Independence.

[David Houchen @dhouchen]

Abaxx will be an interesting company to watch; first of its kind in 12+ years; outstanding preparation and execution

[Tommy Humphreys @tommyhump]

Startup commodity futures exchange Abaxx has launched, marking its first trades in LNG and carbon. Battery metals are next.

Witnessing Josh and his team over these challenging 6.5 years has been inspiring.

Today's go-live is just the beginning of something great.

Congratulations to the Abaxx team on this Big achievement!

[Rany Jazayerli @jazayerli]

It's been a long time since I stayed up until 3 am on a weeknight to write a column. It's been a long time (over 4 years!) since I wrote a column about baseball, period.

But for Willie Mays, it was worth it. https://t.co/jOpblZzDjL

[KWCH 12 News @KWCH12]

LIGHTNING STRIKES LIGHT POLE: Thanks to Nathanael Day for sharing this shocking video from southeast Wichita. Remember, lightning and thunder mean you should take cover!