London Irvine Report: Special Update 21/02/2026 A GDP Miss. Tariffs Illegal. The PCE Rises.

Baltic Dry Index. 2043 +24 Brent Crude 71.76

Spot Gold 5130 Spot Silver 84.57

U S 2 Year Yield 3.48 +0. 01

US Federal Debt. 38.713 trillion

US GDP 31.173 trillion

“I've heard that hard work never killed anyone, but I say why take the chance?”

Ronald Reagan

A US GDP miss. A rising US inflation number. The US Supremes declaring illegal most of President Trump’s tariffs!

The US stock casinos loved it, but I’m not so sure.

The US tort bar will love it though, filing class action after class action on behalf of US consumers who were charged, in whole or part, the illegal tariffs.

Supreme Court strikes down most of Trump's tariffs in a major blow to the president

The decision does not affect all of Trump's tariffs but invalidates those implemented using an emergency law.

Feb. 20, 2026, 3:03 PM GMT / Updated Feb. 21, 2026, 4:12 AM GMT

WASHINGTON — The Supreme Court delivered a major blow to President Donald Trump, ruling Friday that he exceeded his authority when imposing sweeping tariffs using a law reserved for a national emergency.

The justices, divided 6-3, held that Trump's aggressive approach to tariffs on products entering the United States from across the world was not permitted under a 1977 law called the International Emergency Economic Powers Act (IEEPA).

The ruling invalidates many, but not all, of Trump’s tariffs.

Speaking at the White House, Trump harshly criticized the Supreme Court majority, describing the decision as a "disgrace to our" nation and the justices in the majority as "very unpatriotic and disloyal to the Constitution," while suggesting they were "swayed by foreign interests."

Trump's ability to impose tariffs using other laws is not affected by the ruling, and Trump said he plans to use those authorities to impose new duties on a global basis.

On Friday evening, Trump said on social media that he signed a global 10% tariff, which would be a reduction for nearly all foreign nations. The White House outlined the new temporary tariff as being under Trump's authority in section 122 of the Trade Act of 1974, and will begin Tuesday at 12:01 a.m. ET.

Despite Trump's rhetoric about the tariffs benefiting the economy, stocks rallied on news of the ruling.

The ruling was authored by Chief Justice John Roberts, who was joined by three liberal justices and two fellow conservatives, Justices Neil Gorsuch and Amy Coney Barrett, in the majority.

It is a rare setback for the administration at the Supreme Court, which has a 6-3 conservative majority, since Trump began his second term in January 2025.

Business owners who had to pay the tariffs and challenged them in court expressed relief at the ruling.

"These new tariffs were arbitrary, unpredictable, and bad business," Victor Schwartz, who runs New York-based wine and spirits importer VOS Selections, said in a statement.

"Thankfully, courts at every level recognized these duties for what they were: unconstitutional government overreach," he added.

The decision does not affect all of Trump's tariffs, leaving in place ones he imposed on steel and aluminum using different laws, for example. But it upends his tariffs in two categories. One is country-by-country or “reciprocal” tariffs, which range from 34% for China to a 10% baseline for the rest of the world. The other is a 25% tariff Trump imposed on some goods from Canada, China and Mexico for what the administration said was their failure to curb the flow of fentanyl.

Companies that had to pay the tariffs may be able to seek a refund from the Treasury Department. Hundreds have already sued.

The court did not directly address that issue, but Kavanaugh, in dissent, said the effect on the U.S. Treasury could be significant.

"The Court says nothing today about whether, and if so how, the Government should go about returning the billions of dollars that it has collected from importers," he wrote.

----We Pay the Tariffs, a group of small businesses that oppose Trump's tariffs, immediately called for a "full, fast and automatic" refund process.

"Small businesses cannot afford to wait months or years while bureaucratic delays play out, nor can they afford expensive litigation just to recover money that was unlawfully collected from them in the first place," Dan Anthony, the group's executive director, said in a statement.

The Constitution says the power to set tariffs is assigned to Congress. But Trump used IEEPA, which does not specifically mention tariffs but allows the president to “regulate” imports and exports when he deems there to be an emergency due to an “unusual and extraordinary threat” to the nation.

Before Trump, no president had ever used that law to tariff imports. Lower courts ruled against the Trump administration in two related cases that were consolidated, with both sides asking the Supreme Court to issue a definitive ruling.

Supreme Court strikes down most of Trump's tariffs in a major blow to the president

S&P 500 rises, Dow gains 200 points after Supreme Court strikes down Trump emergency tariffs: Live updates

Updated Fri, Feb 20 2026 4:18 PM EST

Stocks rose on Friday after the Supreme Court ruled against President Donald Trump’s tariffs, potentially providing relief for companies burdened by higher costs from the duties and easing concern about sticky inflation still plaguing the U.S. economy.

The S&P 500 advanced 0.69% and closed at 6,909.51, while the Nasdaq Composite gained 0.9% and settled at 22,886.07. The Dow Jones Industrial Average added 230.81 points, or 0.47%, and ended at 49,625.97. The 30-stock index recovered from a 200-point loss earlier in the session on disappointing economic data.

The Supreme Court struck down most of Trump’s sweeping tariff policy under the International Emergency Economic Powers Act, with the majority ruling that that law “does not authorize the President to impose tariffs.” In response, Trump announced he will impose a new 10% “global tariff.”

“Now I’m going to go in a different direction, probably the direction that I should have gone the first time,” the president said during a press briefing at the White House after the high court’s decision. “I’ll go the way I could have gone originally, which is even stronger than our original choice.”

Shares of “Magnificent Seven” member Amazon — a company that sources up to 70% of its goods from China, per Wedbush Securities, and that has already begun to see tariffs impact the price of certain items — jumped more than 2% following the ruling. Others believed to benefit from the outcome were higher as well, such as Home Depot and Five Below.

“In the case of Amazon specifically, a lot of their stuff is imported from China, so tariffs are going to make the prices on Amazon go up for customers, and when prices go up, people buy fewer of those things,” said Jed Ellerbroek, portfolio manager at Argent Capital Management. “No longer facing that problem is the source of excitement, I think.”

While the Supreme Court’s rebuke was largely expected by Wall Street, some questions remain, however, including whether tariffs that have been paid under the steeper rates will need to be given back. The Supreme Court ruling was silent on the matter.

“Now lower courts are going to have to figure out what’s going to happen to people who paid the tariffs and the government paying out big refunds,” said FBB Capital Partners senior research analyst and asset allocation strategist Michael Brenner. “If that’s out there, that would be effectively a form of economic stimulus.”

Earlier in the day, traders received a downbeat view on growth of the U.S. economy, as gross domestic product increased 1.4% for the fourth quarter. That was far below the 2.5% gain that economists polled by Dow Jones had anticipated. The 4.4% advance in the third quarter sharply surpassed estimates.

Stock market news for Feb. 20, 2026

Fourth-quarter U.S. GDP up just 1.4%, badly missing estimate

Published Fri, Feb 20 2026 8:31 AM EST

Economic growth cooled near the end of 2025 while inflation held firm, according to data released Friday that could complicate the Federal Reserve’s interest rate path.

Gross domestic produce rose at an annualized rate of just 1.4%, according to Commerce Department numbers released Friday. Economists surveyed by Dow Jones had been looking for a 2.5% gain.

For the full year in 2025, the U.S. economy grew at a 2.2% pace, down from the 2.8% increase in 2024.

At the same time, inflation held firm in December, according to the gauge most closely watched by Fed officials.

The core personal consumption expenditures price index, which excludes food and energy, rose 3% in December, according to a separate release. That matched the consensus forecast but kept the pivotal inflation measure well above the Fed’s 2% target.

On a headline basis, the PCE index accelerated 2.9%, or 0.1 percentage point higher than expected.

Both indexes rose 0.4% for the month, compared to the respective forecasts for 0.3%.

Just prior to the data release, President Donald Trump warned that the GDP number would be soft, blaming it on the government shutdown that ended in November.

“The Democrat Shutdown cost the U.S.A. at least two points in GDP. That’s why they are doing it, in mini form, again. No Shutdowns!” Trump said in a Truth Social post. “Also, LOWER INTEREST RATES. “Two Late” Powell is the WORST!!!”

The latter part of the post was a reference to Fed Chair Jerome Powell, who Trump has consistently hectored to lower interest rates. The Fed cut its benchmark rate by three-quarters of a percentage point in the latter part of 2025, but officials have since expressed a reluctance to lower further as they gauge the progress in bringing down inflation against threats of a labor market slowdown.

PCE inflation December 2025:

‘Canary in the coal mine’: Blue Owl liquidity curbs fuel fears about private credit bubble

Published Fri, Feb 20 2026 12:34 AM EST

The private credit boom is facing a new test after Blue Owl Capital permanently restricted withdrawals from one of its retail-focused debt funds.

Shares in Blue Owl Capital fell nearly 6% on Thursday after the private market and alternative assets manager sold $1.4 billion of loan assets held in three of its private debt funds.

The biggest portion of the sale came from a semi-liquid private credit fund marketed to U.S. retail investors called the Blue Owl Capital Corporation II, which will stop offering quarterly redemption options to investors, reigniting debate over whether stress was beginning to resurface in one of Wall Street’s fastest-growing corners.

“This is a canary in the coal mine,” Dan Rasmussen, founder and adviser at Verdad Capital told CNBC. “The private markets bubble is finally starting to burst.”

The broader concern is that years of ultra-low interest rates and thin yield spreads encouraged lenders to make riskier moves, financing smaller, more leveraged companies at yields that appeared attractive compared with public markets, market watchers said.

“Years of ultra-low rates and ultra-low spreads and very few bankruptcies led investors to go further and further out the risk spectrum in credit,” Rasmussen said. “This is a classic case of ‘fool’s yield,’ high yield that doesn’t translate into high returns because the borrowers were too risky.”

Private credit, which are generally direct loans made by non-bank lenders to companies, have ballooned into a roughly $3 trillion market globally.

Publicly traded business development companies, or BDCs, which are investment vehicles that lend to small and mid-sized private companies and are a major part of the private credit market, are increasingly funded by retail investors rather than institutions, according to Duke University’s Fuqua School of Business.

The Fuqua research, which was published last September, showed that institutional ownership of BDC shares has steadily declined over time, falling to about 25% on average by 2023.

“This trend indicates that retail investors are playing an increasingly large role in supplying equity capital to publicly traded BDC,” the researchers pointed out.

In 2025, the eight largest members of the S&P BDC Index offered dividend yields which can go up to 16%, with Blue Owl’s at over 11%. For comparison, the S&P Global’s U.S. high yield corporate bond index 1-year, 3-year and 5-year returns stand at around 7.7%, 9% and 4%, respectively.

“The majority of loans in private credit funds that individual investors tend to own, they’re high yield loans. They are, by their nature, somewhat risky,” said Guy LeBas, chief fixed income strategist at Janney Montgomery Scott.

“Over the course of the cycle, you can anticipate some material defaults across these funds,” he added.

'Canary in the coal mine': Blue Owl liquidity curbs fuel fears private credit bubble

Global Inflation/Stagflation/Recession Watch.

Given our Magic Money Tree central banksters and our spendthrift politicians, inflation now needs an entire section of its own.

Fed’s Preferred Gauge Shows Accelerating December Inflation Trends

The personal-consumption expenditures price index increased by 0.4% in December

Feb. 20, 2026 9:01 am ET

Key inflation metrics tracked by the Federal Reserve accelerated at the end of last year, underscoring why many Fed officials have turned cautious about supporting further interest-rate cuts.

The personal-consumption expenditures price index increased by 0.4% in December, after rising by 0.2% in November, the Commerce Department said Friday.

That lifted the 12-month PCE inflation rate to 2.9%, up from 2.8% in November. Core PCE inflation—which excludes volatile food and energy prices—ticked up to 3% in the 12 months through December, from 2.8% a month earlier.

The numbers are roughly aligned with forecasts from analysts, who can use other inflation metrics to forecast PCE inflation with great accuracy. The report also is more lagged than usual, because last fall’s government shutdown has caused cascading delays in the Bureau of Economic Analysis’s publication calendar.

But the figures point to one reason many Fed officials have turned hesitant about easing their policy stance further despite January’s decline in the consumer-price index, now at 2.4%. PCE inflation, not the CPI, is the metric against which the Fed gauges progress toward its 2% inflation target, and it has consistently hovered above that target for most of half a decade.

Much of the time, PCE inflation tends to run cooler than CPI inflation, but for now, the pattern has reversed. That is in large part because housing inflation, which has cooled steadily, plays a bigger part in the CPI calculation than in the PCE calculation, UBS economist Alan Detmeister has observed.

Minutes from the Fed’s January meeting published Wednesday showed that a contingent of Fed officials thinks that at 3.5% to 3.75%, the Fed’s current rate target is near a neutral level that is no longer working to restrain economic growth and rising prices. At last month’s Fed meeting, the minutes showed, one set of officials urged the group to consider communicating that going forward, rate increases may be as much a possibility as further cuts.

PCE Inflation Rose in December, Fueling Federal Reserve Rate Caution - WSJ

The Multipolar Delusion

And the Unilateral Temptation

C. Raja Mohan March/April 2026 Published on February 17, 2026

From Washington to Beijing and Moscow to New Delhi, a consensus is emerging that the world has entered a multipolar era. Political leaders, diplomats, and analysts routinely declare that unrivaled American dominance has ended and global power is now dispersed across multiple centers. The assertion has become so commonplace that it is often treated as a self-evident fact rather than a proposition to be examined. Even officials in the United States, long the principal beneficiary of the unipolar post–Cold War order, have adopted this language. At the start of President Donald Trump’s second term, Secretary of State Marco Rubio observed that Washington’s moment as the sole superpower was historically “not normal” and that the international system would inevitably tend toward multipolarity. Rubio’s statement appeared to echo the growing belief in China, Russia, and much of the developing world that the United States’ power is declining and its long-standing global primacy is unsustainable.

This seeming convergence obscures a difference in how the various players define “multipolarity.” For the Trump administration, acknowledging multipolarity doesn’t mean accepting limits on American power. Instead, it serves as a justification for abandoning the traditional U.S. conception of global leadership and the responsibilities that come with it. The idea of multipolarity allows Washington to pursue a narrower, more transactional foreign policy—one focused on extracting advantage rather than underwriting order, unconcerned with the maintenance of institutions or norms that do not serve immediate American interests. For China, Russia, and many developing countries, by contrast, multipolarity is not merely descriptive but aspirational. It is a political project aimed at constraining American dominance, eroding Western-led institutions, and constructing alternative models of governance, development, and security in which the United States is not the only country in charge.

The idea of multipolarity has been popular since the United States emerged as the sole dominant power at the end of the Cold War. After the 1990–91 Gulf War, which revealed the scale of American military superiority, French leaders warned of the dangers posed by the American “hyperpower.” China and Russia later transformed this critique into a strategy, seeking to organize resistance to U.S. primacy. They established what they declared to be a “strategic partnership” in the late 1990s and formed the multilateral BRICS alliance along with Brazil, India, and South Africa to coordinate among non-Western powers. They believed that such efforts could accelerate the transition away from American hegemony.

Trump’s return to office made the arrival of a multipolar moment seem inevitable. The United States was internally divided, economically unsettled, and weary of global commitments. China’s economy had grown to nearly the same size as that of the European Union, and the country had become a formidable technological leader in its own right. Russia’s war in Ukraine had demonstrated Moscow’s willingness to use force to revise borders in Europe. And BRICS had expanded to include new members in Asia, Africa, and the Middle East, reinforcing the impression of a rising alternative system to counter American dominance. Many observers concluded that the multipolar world had arrived and that American unipolarity was living on borrowed time.

A year later, however, this conviction appears misplaced. The Trump administration has embarked on a forceful reassertion of American power by imposing onerous tariffs, intervening in other countries, and brokering peace negotiations and commercial dealmaking across the world. China and Russia have resisted Washington on select issues, but they have been unable to mount a comprehensive challenge to the United States’ effort to restructure global rules. Washington’s European allies have proved even less able to stand up to the United States. Facing Trump’s insults and pressure, they have wilted and caved.

The reality is that the world is still unipolar.

The Multipolar Delusion | Foreign Affairs

Technology Update.

With events happening fast in the development of solar power and graphene, I’ve added this section.

This weekend, something different. With all of the UK’s and Europe’s great rains this autumn and winter, it’s nothing new. No man-made global warming, whatever lies the BBC spreads.

The Great Flood and Great Famine of 1314

Published: 24th March 2015

During the winter and spring of 2013/2014, Britain suffered a prolonged period of destructive winter storms, resulting in widespread flooding and damage. However this was not the first time that the country had been devastated by heavy periods of rain and bad weather.

It rained almost constantly throughout the summer and autumn of 1314 and then through most of 1315 and 1316. Crops rotted in the ground, harvests failed and livestock drowned or starved. Food stocks depleted and the price of food soared. The result was the Great Famine, which over the next few years is thought to have claimed over 5% of the British population. It was the same or even worse in mainland Europe.

The shortage of crops pushed up prices of everyday necessities such as vegetables, wheat, barley and oats. Bread was therefore also expensive and because the grain had to be dried before it could be used, of very poor quality. Salt, the only way at that time to cure and preserve meat, was difficult to obtain because it was much harder to extract through evaporation in wet weather; its price rose dramatically.

In the spring of 1315 Edward II decreed that the price of basic foodstuffs be limited. This did not however do much to mitigate the crisis: the traders simply refused to sell their goods at these low prices. In the end the act was abolished at the Lincoln parliament in 1316.

The situation got worse and worse as the rain continued to fall. It was reported that there was even no bread in St Albans for the king and his court when they stopped off there on 10th – 12th August 1315.

Things were particularly bad in the north of England and especially in Northumbria, where the people were already struggling due to looting by Scottish raiders. The population here resorted to eating dogs and horses.

Everyone was affected, from nobles to peasants. Things got so bad in the winter of 1315/1316 that the peasants ate the seed grain they had stored for planting in the spring.

By 1316 there were even rumours of cannibalism. In their misery and starvation, many people begged, stole and murdered for what little food they could find. Even law-abiding people resorted to criminality in order to feed themselves.

Parents who could no longer feed their families abandoned their children to fend for themselves. Indeed, the fairytale of Hansel and Gretel may have originated at this time. In the story, Hansel and Gretel have been abandoned in the woods by their parents during a time of famine. They are taken in by an old woman living in a cottage. The old woman starts to heat the oven, and the children realise she is planning to roast and eat them. Gretel manages to trick the old woman into opening the oven, and then pushes her in.

As the cold, wet weather continued, the famine reached its height in spring 1317. Finally in the summer of that year the weather patterns returned to normal, but it was 1322 before the food supply recovered completely.

So what caused year after year of severe winters and cold, rainy summers? The onset of the Great Famine coincided with the end of the Medieval Warm Period and the beginning of a Little Ice Age. The European climate was changing, with cooler and wetter summers and earlier autumn storms. These were far from ideal conditions for agriculture and with a large population to feed, it only took one failed harvest for things to get very bad very quickly.

Some historians think that this terrible weather may have been caused by a volcanic eruption, perhaps that of Mount Tarawera in New Zealand which is known to have erupted around 1314.

Unfortunately the Great Famine was only the first of a series of severe crises to hit Europe in the 14th century; the Black Death was just around the corner…

The Great Flood and Great Famine of 1314

Next, the world global debt clock. Nations debts to GDP compared.

World Debt Clocks (usdebtclock.org)

Exponent Calculator

Enter values into any two of the input fields to solve for the third.

Exponent Calculator

This weekend’s music diversion. Another long forgotten composer. Approx. 16 minutes.

Jan Křtitel Jiří Neruda (c.1711-1776) - Concerto per il Clarino (1772)

Jan Křtitel Jiří Neruda (c.1711-1776) - Concerto per il Clarino (1772)

Next, when Citibank architecture had a problem. Approx. 33 minutes.

How a student’s question exposed a fatal flaw in a New York skyscraper

How a student’s question exposed a fatal flaw in a New York skyscraper | Watch