Baltic
Dry Index. 1923 -13
Brent Crude 67.38
Spot Gold 5045 Spot Silver 81.59
US 2 Year Yield 3.50 +0.03
US Federal Debt. 38.663 trillion US GDP 31.138 trillion.
A businessman cannot force you to buy his product; if he makes a mistake, he suffers the consequences; if he fails, he takes the loss. If bureaucrat makes a mistake, you suffer the consequences; if he fails, he passes the loss on to you.
Ayn Rand
Did Japan’s voters just rescue stocks and cryptos although probably with little direct effect on commodities? Precious metals are already rebounding due to demand as a hedge against US weaponised dollar debasement.
Japan’s “Margaret Thatcher” just won a landslide election victory, as our brave 21st century world keeps moving to the right.
AFD in Germany and Reform in GB next?
Japan’s Nikkei 225 crosses 57,000 for the first
time as Takaichi secures historic mandate
Published Sun, Feb 8 2026 6:50 PM EST
Japanese stocks jumped to a record high
Monday, leading gains in the region after Prime Minister Sanae Takaichi won a
landmark election victory.
The ruling Liberal Democratic Party
captured a two-thirds supermajority in the 465-seat lower house, public
broadcaster NHK reported.
Japan’s Nikkei 225 jumped 5.6% to
hit 57,337, while the Topix advanced over 3%, also notching a record high.
A decisive win for Takaichi could be the
“best outcome” for markets over the medium term, as strategic investments and
tax reform bolster equities, said Sree Kochugovindan, senior research economist
at Aberdeen Investments.
Japanese stocks have hit several highs
over the past few months, driven by the so-called “Takaichi trade” as markets
expect the prime minister’s economic policies — seen as growth‑focused
continuation of Abenomics — to boost equities, while weakening the yen as she
pushes for a looser monetary policy and higher government spending.
The real estate sector was leading Nikkei
gains, up over 7%, followed by healthcare and industrials sectors, data from
LSEG showed as of 8.11 p.m. ET Sunday.
Japanese internet company CyberAgent Inc
was the index’s top gainer, up more than 16%. Semiconductor equipment maker
Advantest surged over 12%, followed by Sumitomo Electric Industries which
posted gains of more than 11%.
The Japanese yen strengthened to 156.88
against the dollar. Yields on the 10-year Japanese government bonds rose nearly
4 basis points to 2.274%, while yields on 20-year JGBs added about 3 basis
points to 3.158%.
Takaichi’s administration has gained
stronger momentum to pursue a major shift toward proactive fiscal policy,
backed by a clear public mandate, Crédit Agricole CIB echoed in a note
following her victory.
U.S. President Donald Trump congratulated
Takaichi on her victory in a TruthSocial post.
″She is a highly respected and very popular
Leader. Sanae’s bold and wise decision to call for an Election paid off big
time,” he wrote. “The wonderful people of Japan, who voted with such
enthusiasm, will always have my strong support.”
The election follows political upheaval
last year, when the LDP lost its majority in the Upper House, and a
Lower House defeat in 2024, which prompted then-Prime Minister Shigeru Ishiba
to resign in September.
Other Asian markets also traded higher,
with South Korea’s Kospi jumping 4.15%, while the small-cap Kosdaq added 2.97%.
Australia’s S&P/ASX 200 rose 1.65%
in early trading.
Hong Kong’s Hang Seng Index rose 1.5%,
while the mainland’s CSI 300 climbed 0.9%.
U.S. futures inched higher in early Asia
hours.
Last Friday in the U.S., stocks surged as
tech names recovered following several days of heavy selling in the sector
and bitcoin rebounded
following a rout that took the popular cryptocurrency down more than 50% from
its high in October last year.
The Dow Jones Industrial Average advanced
1,206.95 points, or 2.47%, closing at 50,115.67. Friday marked the first time
the Dow exceeded
the 50,000 level. The S&P
500 jumped 1.97% and ended at 6,932.30, while the Nasdaq Composite advanced
2.18% to 23,031.21. With those moves, the S&P 500 climbed back into the
green for 2026.
Even with Friday’s pop, the S&P 500
posted a 0.1% decline for the week, while the Nasdaq fell 1.8% on the week. The
30-stock Dow rose 2.5% week to date, benefiting from some rotation into some
economically cyclical stocks even as the overall market was weighed down by
tech selling.
Japan's
Nikkei 225 crosses 57,000 for the first time as Takaichi secures historic
mandate
Global week ahead: Tech rotation puts European
stocks back in play
Published Sun, Feb 8 2026 1:53 AM EST
When the U.S. sneezes, it seems Europe may
not catch its cold in the same way it used to.
The Stoxx 600 is sitting close to record
highs after recording its 7th positive week in eight, despite the tech-led
devastation around it.
It’s been a different story across the
pond. In a recent note, Deutsche Bank has started drawing comparisons to the
dot-com bubble of 2000, and says the recent sell-off in AI and software-exposed
stocks is showing no signs of easing. This week’s declines leave the S&P
500 down almost 30 percent from their October 2025 peaks.
Broader European stocks meanwhile, are
looking more resilient.
The spike in volatility comes at a
sensitive time for the corporate world, with earnings season in full swing. The
big-tech releases from last week did little to calm nerves stateside, while
some of Europe’s biggest names are preparing to report this week.
Banking on M&A
CNBC’s Carolin Roth will breakdown
UniCredit’s results in Milan on Monday, speaking with the Italian bank’s CEO
Andrea Orcel. The lender remains a key M&A player in Europe, with its
minority stakes in Commerzbank and Greece’s Alpha Bank returning around 20
percent returns on investment, according to the bank.
In Frankfurt, we will hear from rival
Commerzbank’s CEO Bettina Orlopp on Wednesday, who told Squawk Box during the
World Economic Forum in Davos in January that a deal with UniCredit is “not
sensible” given the German bank’s high valuation.
Shares in financial stocks across Europe
had a rollercoaster week, ending the week in the red.
More
Global week ahead:
Tech rotation puts European stocks back in play
Private credit worries resurface in $3 trillion
market as AI pressures software firms
Published Sun, Feb 8 2026 11:41 PM EST
Private credit markets are facing fresh
uncertainty as AI-driven tools start to pressure software companies, a major
borrower group for private lenders.
The software industry came under renewed
pressure last week after artificial intelligence firm Anthropic unveiled new AI
tools, sparking a sell-off in software data provider shares.
The AI tools, developed by Anthropic, are
designed to perform complex professional tasks that many software companies
currently charge for, raising fresh concerns that AI could weaken traditional
software business models.
Shares of asset managers with large
private credit franchises tumbled this week as investors fretted about how AI
could upend borrowers’ business models, pressure cash flows and ultimately lift
default risks.
Ares
Management fell over 12% last week, while Blue Owl Capital lost
over 8%. KKR declined
almost 10%. TPG lost
about 7%. Apollo Global and BlackRock fell over 1% and 5%,
respectively. For comparison, the S&P 500 declined by about
0.1%, while the tech-heavy Nasdaq fell
1.8%.
The moves bring to fore a growing unease
around private credit market which now has to brace for the impact from
AI-driven disruption to the software sector that is heavily exposed to buyouts
financed with opaque, illiquid loans, according to market watchers.
“Enterprise software companies have been a
favored sector for private credit lenders since 2020,” PitchBook wrote in a
report last week following the fallout, adding that many of the largest-ever
unitranche (two or more loans combined into one) loans, the favorite structure
of the private credit market, have been to software and tech companies.
Software makes up a significant share of
loans held by U.S. business development companies, accounting for about 17% of
BDC investments by deal count, second only to commercial services, data from
PitchBook showed.
That exposure could prove costly if AI
adoption accelerates faster than borrowers can adapt. UBS Group has warned
that, in an aggressive disruption scenario, default rates in U.S. private
credit could climb to 13%, significantly higher than the stress projected for
leveraged loans and high-yield bonds, which UBS estimates could come to around
8% and 4%, respectively.
More
Private
credit's software blind spot sparks fresh fears for $3 trillion sector
In other news, more red flags.
The Stock Market Sounds an Alarm as Wall Street
Gets Bad News About President Trump's Tariffs. History Says This Will Happen
Next.
Sat, February 7, 2026 at 8:30 AM GMT·
The S&P 500 (SNPINDEX:
^GSPC) has essentially traded sideways in 2026, but history says the
benchmark index could decline sharply in the coming months.
Several recent studies show President
Trump's tariffs are siphoning money away from U.S. companies and consumers, and
the S&P 500 just flashed a warning last seen during the dot-com crash in
October 2000.
Recent studies suggest President Trump's
tariffs will slow economic growth
President Trump has repeatedly argued that
foreign exporters will pay his tariffs for the
privilege of doing business in America. He went further last month in an
editorial published by The Wall Street Journal, claiming foreign
companies were "paying at least 80% of tariff costs." He even linked
a study from the Harvard Business School to validate his claim.
What's the problem? The study Trump linked
made no such claim. In fact, the researchers arrived at the opposite
conclusion. The report states, "Our results suggest that U.S. consumers
paid up to 43% of the tariff burden, with the rest absorbed by U.S.
firms."
Those results roughly align with research
from other institutions. Goldman Sachs economists report that
U.S. companies and consumers collectively paid 84% of tariffs in October 2025.
And they estimate consumers alone will bear 67% of the burden by July 2026.
Similarly, the Kiel Institute examined
shipments totaling $4 trillion between January 2024 and November 2025, and the
researchers concluded, "Foreign exporters absorb only about 4% of the
tariff burden." The other 96% is passed along to U.S. importers and
consumers.
Trump's tariffs are effectively a tax on
consumption, which means they reduce buying
power for
consumers and raise input costs for businesses. That's a problem because
consumer spending and business investments account for approximately 85%
of GDP. By siphoning
money away from consumers and businesses, tariffs threaten to slow economic
growth.
The stock market sounds an alarm last
witnessed during the dot-com crash
The S&P
500 recorded
an average cyclically
adjusted price-to-earnings (CAPE) ratio of 39.9 in January 2026, marking the
fourth consecutive monthly reading above 39. Prior to that, the S&P 500
last recorded a monthly CAPE ratio over 39 during the dot-com crash in October
2000. The CAPE ratio is used to determine whether entire stock
market indexes are
overvalued, and multiples above 39 have historically correlated with dismal
future returns.
The table shows the S&P 500's best,
worst, and average performance over different time periods following a monthly
CAPE reading above 39.
As shown, after recording a monthly CAPE
ratio above 39, the S&P 500 has returned an average of 0% during the next
six months. But the index has declined by an average of 4% in the next year,
and it has declined by an average of 20% in the next two years.
The big picture
The S&P 500 currently trades at an
expensive valuation that has historically portended steep losses. Such an
outcome is arguably more likely in the current market environment because
President Trump's tariffs threaten to slow economic growth.
Of course, past performance is never a
guarantee of future results. Investors may tolerate higher valuation multiples
because artificial
intelligence (AI)
is likely to drive higher earnings growth in the future. Indeed, S&P 500
companies reported an acceleration in earnings in 2025, and Wall
Street expects
another acceleration in 2026.
So, investors should not sell their
portfolios in anticipation of a market
drawdown.
Instead, now is a good time to sell any stocks in which you lack conviction.
It's also a good time to be more conservative when you put money into the
market. Rather than investing every dollar, consider building a cash
position in
your portfolio.
Above all, focus on creating wealth over
the long term rather than navigating volatility in the short term. The S&P
500 has returned 10.2% annually over the last 30 years, and there is no reason
to believe the next 30 years will be much different.
More
Bankruptcy filings hit 3-year high across U.S.,
with 1 in 15 cases filed in Texas
Filings in Travis and Bexar counties
increased at nearly twice the pace of cases filed across the U.S. as inflation,
high rates and tariffs took a toll.
Fri, February 6, 2026 at 4:47 PM GMT
Bankruptcy filings hit a three-year high
in 2025 — and 1 of every 15 of those was in a Texas
bankruptcy court. Across
the state, more than 38,000 individuals and businesses filed for protection
from creditors in 2025, up more than 20% from 31,520 a year earlier.
With Texas and the nation facing rising
economic pressures tied to nagging inflation, the impact of tariffs and higher
lending rates, bankruptcy filings across the U.S. jumped 11% last year to
574,315 from 517,308 in 2024, according to new data from the Federal Courts of the United States.
The pace of increase in Texas — and
in Travis and Bexar counties — was roughly twice that. In Travis
County, 905 people and businesses
filed bankruptcy last
year, up 24% from 728 cases in 2024. In Bexar County, courts saw
2,300 filings last year, up about 18% from 1,948 in 2024.
The annual increase was expected, as the
rate of filings was seen rising in quarterly data releases through the year.
But it comes after bankruptcy filings had fallen from a 2010 high of 1.6
million to a June 2022 low of 380,634. The rise has mainly corresponded with
the aggressive increase in interest rates, which is pushing up the cost of
borrowing and eating up cash flow of businesses and people with floating
rates.
Though it was a three-year high, the 2025
total is still far below historical highs, according to courts data.
Through 2025, nearly 25,000 businesses
filed for some form of bankruptcy protection, a 7.1% increase from the year
before.
More
Bankruptcy filings
hit 3-year high across U.S., with 1 in 15 cases filed in Texas
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.
Approx.
3 minutes.
U.S. Layoff Tsunami: 108K Jobs Axed in January,
Worst Since '09 Crash | GRAVITAS
Technology
Update.
With events happening fast in the
development of solar power and graphene, among other things, I’ve added this
section Updates as they get reported.
A clever
quantum trick brings practical quantum computers closer
Date:
February 6, 2026
Source:
ETH Zurich
Summary:
Quantum computers struggle because their
qubits are incredibly easy to disrupt, especially during calculations. A new
experiment shows how to perform quantum operations while continuously fixing
errors, rather than pausing protection to compute. The team used a method
called lattice surgery to split a protected qubit into two entangled ones
without losing control. This breakthrough moves quantum machines closer to
scaling up into something truly powerful.
Quantum computers have the potential to
transform fields ranging from materials science to cryptography, but today they
remain extremely difficult to build and operate. One of the biggest challenges
comes from decoherence, a process that introduces errors into quantum systems.
These errors usually take the form of bit flips or phase flips. A bit flip
occurs when a qubit unexpectedly switches between '0' and '1'. A phase flip
happens when the phase of a quantum superposition suddenly reverses, changing from
positive to negative.
Because these changes can happen at
random, even a single error can disrupt a calculation. Preventing that
disruption is one of the central problems facing quantum engineers.
Protecting Information With Logical Qubits
To reduce these errors, researchers
combine many physical qubits into a single logical qubit and apply continuous
error correction. This strategy helps preserve quantum information over time,
making storage relatively stable. But storing information is only part of the
task. To run a quantum algorithm, qubits must be actively manipulated using
quantum gates, which are the basic operations that power quantum computation.
Applying those operations without
introducing new errors has proven far more difficult than simply keeping qubits
stable at rest.
A New Way to Compute While Fixing Errors
A team led by D-PHYS Professor Andreas
Wallraff has now demonstrated a method that tackles this problem directly.
Working with researchers from the Paul Scherrer Institute (PSI) and theorists
led by Professor Markus Müller at RWTH Aachen University and Forschungszentrum Jülich, the
group showed how to perform quantum operations between superconducting logical
qubits while correcting errors at the same time. Their findings were recently
published in Nature Physics.
The work marks an important advance
toward fault tolerant quantum computing, where calculations can proceed without
being derailed by constant errors.
More
A clever quantum trick brings practical quantum computers closer |
ScienceDaily
Next, the
world global debt clock. Nations debts to GDP compared.
World Debt Clocks
(usdebtclock.org)
There is no difference between communism and socialism, except
in the means of achieving the same ultimate end: communism proposes to enslave
men by force, socialism - by vote. It is merely the difference between murder
and suicide.
Ayn Rand
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