Alts & VC / Connect with me: linkedin.com/in/robtopping The “Nu40” -Tweet of #life, #art, #finance and #newassetclasses. 28 yrs - hedge fund = survivor
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Rob Topping retweeted
US Treasuries are experiencing one of the worst bear markets in history:
The 30Y US Treasury price return index has dropped -60% since 2020, to ~107, matching its lowest level in 2000.
In other words, in just 6 years, the index has erased nearly 20 years of gains.
By comparison, US nominal GDP has grown +63% over the same period.
This comes as the 30Y Treasury yield has surged +478 basis points from its intraday low of 0.71% set in March 2020.
To put this into perspective, its previous largest drawdown over the past 40 years was -35% during the 2008 Financial Crisis.
We are witnessing a historic bond market decline.
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🙏✌️
Haines Warns of a Third World War
Avril Haines, who ran America's eighteen intelligence agencies under Joe Biden, now calls a third world war a plausible scenario, and she lays much of the blame on Donald Trump's handling of diplomacy and security.
Speaking to the Financial Times, she said the president trusts his gut more than the expertise around him, and that Washington has entered an era of post-diplomacy from which even a change of president may not bring a return.
With institutions weakening, conflicts multiplying and Xi Jinping sensing room to extract concessions on Taiwan, she argues the guardrails against catastrophe are being dismantled precisely when they matter most.
Stay connected,
follow Gandalv @Microinteracti1
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Well put.
I was walking through the halls of Congress with U.S. Senator Ron Wyden. We were talking about corruption when he pointed down the hallway toward a room and said, if you’re looking for the heart of government corruption, it’s right in there. He was pointing to the room where, as he described it to me, the tax favors were sold.
The tax code is the moral code, and every day it’s for sale to the highest bidder.
The legal expression of what a society wants more of and what it wants less of is for sale.
The law that determines what work gets done, where investment goes, and how people spend the finite hours of their lives is not decided by debate or morals, but by who can pay to get favorable rules.
A clean tax code would start by deciding what kinds of human activity a society wants more of – not who can pay the most to rig it.
Doctors, nurses, teachers, EMTs and other people whose work directly strengthens human life would pay almost nothing.
Creative work, athletics, hospitality, travel, food, art, scientific research and productive technology would be taxed lightly because they increase human health, knowledge, experience, creativity and connection.
Then taxes would rise as social value falls and social cost rises. Businesses built around phone, drug or gambling addiction and extraction would be at the top of the scale.
The rates and categories are what politicians would argue about as part of a continuing debate over what our society values.
Public tax debates begin with the wrong question: who has the money?
That is the wrong frame.
The first question is: What do we want to encourage or discourage for work and investment in our society?
The second is: What state is the money in?
Right now, we favor asset owners over active-income earners. We tax human effort heavily while allowing accumulated capital far greater freedom to compound. Ironically, that principle is antithetical to the premise of America itself: that anyone can change the circumstances of their life through creativity, intelligence and effort.
The second principle is simple: money generated by human work should be taxed last, while capital that has become large enough to compound on itself should be taxed first unless it is put back into productive use.
That is the key distinction.
Invest accumulated capital in hospitals, medicine, education, science, food, housing, infrastructure, art, sport, hospitality, travel or useful technology and the tax falls dramatically.
Let it sit in a self-compounding pool whose primary function is generating more capital, as it finances monopoly, extraction and social harm, and the tax rises.
The point is not redistribution.
The point is circulation.
Every tax is a moral choice.
The only serious question is whether the code reflects the kind of society we actually want to build.
Subscribe: dylanratigan.substack.com
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Brilliant
Justin Verlander skipped a month of rehab to pitch one more game.
He hadn't started since March. He's 43, and a hip injury plus a torn-up hamstring had eaten nearly his entire season. A normal rehab timeline ends with the season over and the career finished on a training table. So he compressed it, got through one bullpen session Tuesday, and the Tigers gave him the ball Saturday.
The ending was engineered a year in advance. Verlander re-signed with Detroit last winter for exactly this. The Tigers drafted him #2 overall in 2004, he wore their uniform for 12 seasons before Houston and the two rings, and he came back at 43 so the last pitch of his career would come in the same uniform as the first one.
The Pirates shortstop he faced in the first inning is 20. He wasn't alive when Verlander made his debut in July 2005.
Five-plus innings, six strikeouts, career total 3,560, eighth in the history of the sport. Detroit walked it off 4-3 so he wouldn't take a loss.
And the exit was the one part nobody planned. When the manager came out to take the ball, Verlander's 7-year-old daughter sprinted onto the field to the mound. He said it blindsided him, that she'd never seen him cry like that. He walked off holding her hand while the whole park stood.
Most pitchers never get an ending. An elbow or a shoulder picks one for them, and the last start only becomes the last start in hindsight. Verlander spent 21 seasons watching that happen to everyone around him. He built his own ending, and the only moment he couldn't script is the one nobody will forget.
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Ode to the #givers. Amazing
This is Howard Buffett, Warren Buffett’s middle son. He is 71 years old. He dropped out of college three times. He drinks Dr Pepper and like his father, looks for a McDonald’s wherever he travels.
Since the beginning of the war, his foundation has become the largest private donor to Ukraine: $1.4 billion. Over four years, he has personally visited Ukraine 27 times.
In April 2022, he saw burned-out agricultural machinery all over Ukraine and called the president of John Deere:
“How many combines are available in Europe?”
“Fifteen. All of them were supposed to go to Russia.”
“I’ll take them all. Ship them to Ukraine.”
Then came all the available New Holland equipment in Europe. Altogether, more than 100 tractors and combines have been provided to Ukrainian farmers. Free.
He tested de-mining equipment on his farm in Illinois, detonating explosives beneath rollers. When someone asked if blowing up his own tractors to find a solution was worth it, Buffett replied:
“Stop counting my tractors. If necessary, I’ll blow up a thousand of them.”
When he heard about the "Superhumans" project, the medical program to provide arms and legs for soldiers who have lost theirs, they asked if he'd be willing to kickstart the program with $1 million. Buffett asked how much was needed to build the entire center.
“$14 million" was the answer.
He replied: “Okay. Build it.”
Today, his support for Superhumans has reached $77 million, and the center has treated almost 2,000 wounded soldiers and civilians who have lost limbs due to the war.
But his largest area of spending is neither agricultural machinery nor prosthetics.
It is food: 642 million meals.
He has built, stocked and staffed mobile kitchens that go into areas where civilians, often very elderly, whose homes have been destroyed by Russian bombing.
Real help from a person who has no personal motivation to profit from Ukraine. He simply chooses to help.
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Or maybe the powers at be are manipulating the indices into we get to the midterms. That would explain the 3.5x sub stock : index volatility and lack of participation by so many stocks (60% in a bear market).
We've never seen this before:
The junk bond yield spread is diverging massively from stocks, particularly the mega cap AI stocks. Note how tightly correlated they were before the war.
This war has led to massive unresolved market divergences, because stock investors are convinced it will be over "soon". While other markets are imploding in real time.
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Rob Topping retweeted
The US Dollar has lost -23% of its purchasing power since 2020.
In other words, if your assets are up +30% since 2020, you have effectively just broken even in real terms.
Inflation has now been above the Fed's 2% target for 60-straight months, and the bond market knows this.
Own assets or be left behind.
It's official.
As the bond market "meltdown" accelerates, the average interest rate on a 30Y mortgage in the US is up to 7.45%.
That's up +150 basis points in 6 months and the highest since 2023, when inflation was at 6.4%+.
What is happening? Let us explain.
(a thread)
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Can’t stop thinking about this. Somebody should put this guy up for a Nobel Peace Prize.
instagram.com/reel/DcLsim3RF…
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I’m in high alert mode BUT if I were to argue the contrary to the data it would be in a world of a proliferation of died income ETFs and a reversal of 40 year decking rates what % of the 12 are fixed income.?
Still not to be dismissed but ….?
Today was only the second time in the history of SPY where
▪ "NYSE New Lows" was 12% or higher
▪ SPY was within 1.5% of all time highs
And would you like to see how SPX did over the next 55 days last time? I fucking thought so.
[h/t to @BenKizemchuk for the concept&data]
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Rob Topping retweeted
For most of my life, a rising market was understood as evidence of broad economic strength. Businesses grew. Companies competed. Capital flowed toward businesses that created value for people.
Competition was the engine. Charge too much and somebody undercuts you. Make a bad product and somebody makes a better one. Competition doesn’t require corporations to be generous. It forces them to be useful.
Now look at the market.
The ten largest companies represent roughly 38 percent of the S&P 500, and 33 companies account for 100 percent of all of the gains.
Those companies control the gates through which the rest of the economy must pass: AI infrastructure, search, cloud computing, operating systems, app stores, digital advertising, and commerce.
These technology monopolies provide enormous value……so does electricity. That is precisely why we regulate electric utilities.
America understood that something could be indispensable and thus require limits on the company controlling it to prevent brutal exploitation.
The electric company could make money, but we didn’t allow it to use control of the wires to financially choke out every factory, restaurant and family connected to them.
The pipes became digital and we forgot the lesson, or more accurately our government was sold to the very people it is intended to control.
Monopoly doesn’t eliminate competition, it reverses its pressure. Under competition, a company must give you more, better, faster for less or lose you.
Under monopoly, there is almost no price you won’t pay, accept the terms and pass through the gate because there is nowhere else to go.
Wall Street loves that.
The stronger the gate, the more dependable the profits. The more dependable the profits, the more valuable the company.
That is why record stock prices and economic distress are not contradictory. The stock market can rise precisely because the economic hammerlock becomes more valuable.
Meanwhile, the ten-year Treasury yield has crossed 5 percent, reaching levels not seen since 2007. The bond market is demanding substantially more compensation to finance the country being extracted by those companies.
The bond market prices the stress. The stock market prices the chokehold.
A Burmese python kills in much the same way. It wraps itself around its prey. Each time the animal exhales, the python tightens. The next breath gets smaller. Another exhale. Another turn of the coil.
The python grows stronger as its prey grows weaker.
Watching the stock market and declaring the economy healthy is like watching the growing python and declare that everything inside its coils must be thriving.
We have it backward.
The stock market isn’t hiding what’s happening to America. It’s pricing the squeeze.
Subscribe: dylanratigan.substack.com
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Thank you @andrewchen
The visual of why we are strategic investors at gixfiber.com and quantumcorrior.com
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Rob Topping retweeted
🚨THIS IS INSANE
US stock market is at all-time highs, but a lot of stocks are struggling.
Right now, nearly 50% of the US stocks are moving in the opposite direction of where the stock index is going.
This is even higher than the 2000-dot com bubble and 2018 stock market crash.
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Rob Topping retweeted
Bloomberg just dropped the most disturbing investigation I have read this year, and every AI builder should read it and take it seriously.
On February 28, two Tomahawk missiles hit an elementary school in Minab, a small town in southern Iran. 156 people died. At least 123 were children. The Pentagon knew within hours that it had bombed a school.
The school had its own website. It was labeled on Google Maps. You could see the soccer pitch from a satellite view. You could see the brightly painted walls. Any 12-year-old with a browser could tell what the building was.
The AI system could not.
Inside US Central Command, personnel were using Palantir's Maven Smart System. It is an AI targeting platform running on a $1.3 billion Pentagon contract, and embedded inside it is Anthropic's Claude.
On day one of the war, more than 1,000 targets went through it in 24 hours. Work that used to take a team hours per target got compressed into minutes.
The satellite imagery Maven was pulling from was seven years old. The site was still tagged in the database as an Islamic Revolutionary Guard facility.
The system spat it out as a recommended day-one target. Humans signed off. The first missile flew. Then a second one landed minutes later to hit the people who came to help.
Investigators later found that some Central Command staff had assumed Maven would flag stale intelligence for them. It did not. Nobody had told it to.
Palantir told Bloomberg the government is responsible for the underlying data. The Pentagon's civilian harm mitigation team, the people whose actual job is to catch a target like this, had been cut back before the war started.
This is not AI going rogue. This is the opposite.
This is AI doing exactly what it was built to do at exactly the speed it was built to do it. And a school full of little girls got vaporized because the humans in the loop trusted the machine more than they trusted their own eyes.
I keep thinking about the version of this story that comes next. What happens when the system is faster. When the target list is not 1,000 in a day but 10,000. When "review" becomes a button the operator has three seconds to hit before the next target loads. When there is no human left slow enough to notice that a soccer pitch is not a helipad.
We are not talking about a spam filter mislabeling an email. We are talking about a system that turned a seven-year-old database entry into two cruise missiles landing on children in the middle of a morning class.
A UN-backed panel has now called it a potential war crime.
In terms of children killed, it is the deadliest American targeting error of the entire 21st century. And according to Bloomberg, some of Defense Secretary Hegseth's own advisors are worried that too much public scrutiny of Maven might slow down its adoption inside the Pentagon.
Read that last line again.
If you build this stuff, you own what it does. You do not get to hide behind "the government owns the data." The whole pitch of your product is that speed and integration save lives. When it takes them instead, that is also on you.
I am not against AI in defense. I am against AI in a hurry. Speed is the entire mechanism that made Minab possible. Every guardrail we already know how to build takes time, and time is exactly what the system was designed to eliminate.
So here is the question I have not been able to stop asking, and I genuinely want to know what you think.
If a piece of software helped kill 123 children in a single morning while behaving exactly as designed, what does "responsible AI" even mean anymore?
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As an angry moderate, and just middle of right, I would say the Democrats still don’t get it if she is the candidate (and JB the VP!)!
They never ask how Trump got elected in the first place. SameO SameO
If Kamala wins the Democratic nod, I could see Pritzker being the VP nominee.
It would help with fundraising. He could easily put $500M into the race.
Other options are a swing state governor or someone with military experience like Shapiro, Beshear, or Duckworth.
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Rob Topping retweeted
Silver adjusted for money supply.
What a great chart that tells the silver story incredibly well.
A breakout with authority earlier this year, followed by a move from euphoria back to neglect as silver corrected toward former resistance, which has now become major support.
The long-term thesis for silver not only remains intact, it is stronger than ever.
tavicosta.substack.com/p/the…
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