What caught my eye this week.
Well he’s achieved what the simultaneous fears of an AI bubble and the fear that AI would take all our jobs couldn’t quite manage.
For a moment yesterday, US President Donald Trump had sent [1] the Nasdaq market into correction territory:
[2]
Of course it’s true that markets – especially US markets – have been cruising for a bruising [3] for ages.
But still, we haven’t seen a decline like this since Trump last took his agenda to the global stage, when he was throwing around (figurative) bombshells back in April 2025 on his ill-fated Liberation Day.
Most of the tariff hullabaloo has since been unwound, either by Trump’s own backpedaling or the intervention of the US courts. And the final bill for his economic illiteracy has largely been paid by the US taxpayer, in the form of [4] US firms and consumers.
It would be nice to think the Iran conflict will end the same way, and soon.
It’s possible. Despite Trump having said hours earlier that he wasn’t interested in a ceasefire [5] with Iran, I woke to news that some tweet or segment from a Fox News pundit now had him pondering winding down [6] his latest campaign.
Top Trump
We’ll have to see how Trump feels tomorrow. Nothing else will matter.
US politicians have been supine while enabling Trump’s second term antics – which is why he so swiftly went from abducting [7] a head of state to at least taking the cellophane off the manual marked World War 3 – and he doesn’t appear bothered about the average US voter, either.
So despite the war cementing Trump’s status as the most unpopular [8] president of all-time, so far he’s not for TACO-ing [9].
And yet the bombing potentially going into a fourth week is already surprising, given that the White House war aims appear to have been met:
- The casual decapitation of another sovereign regime
- Plenty of exciting new downloadable content [10] for fans
- Nobody moaning – or reading – about ICE shooting US citizens [11] anymore
But what about the ‘complete obliteration’ of Iran’s capacity to develop nuclear weapons, you say?
Don’t be silly. Trump assured us [12] he’d already done that last year.
No doubt he’ll completely obliterate it again next year if he needs to.
The sick man of the G7
Falling stock markets are one thing, and arguably not even unwelcome. They come with the territory.
The unmooring of the world’s hegemonic superpower is another, more frightening thing. At the far end of that storyline is a long global conflict just one mistake away from the four-minute warning.
And slap-bang in the middle is good old Blighty, always ready these days to get the worst of it [13]:
[14]
Other consequences [15] that even those who complain that ‘politics’ – if that is what we’re witnessing – has no place on an investing website like Monevator will concede are relevant include a near-50% rise in the oil price to $100, and a direct hit on UK households:
-
- Energy bills could hit almost £2,000 a year… – Guardian [16]
- …as gas prices reach their highest level for three years – This Is Money [17]
There’s little that the UK government can do in response. Not least because Rachel Reeves has bills to pay of her own. Any breathing room from lower borrowing costs has again gone for now:
[18]
If yields stay up here for long they will kibosh any economic recovery. They’ve probably already done for a spring bounce in our beleaguered housing market.
Hence the UK economy will continue to languish – at least £100bn a year smaller [19] than it would have been if we had remained in the EU, and thus £40bn short annually of the tax receipts that might have helped make things better.
But I won’t shoot more fish in the Brexit barrel today.
Indeed one can almost look fondly on our own poundshop populist-in-chief, given that Nigel Farage can apparently satisfy his own urges for crass showmanship and self-interest by charging £100 a pop [20] to meet the whims of white supremacists on the Cameo app, when the alternative is blowing up the Middle East.
Falling down
Unlike our own witless foray into national self-harm though, something good could actually come out of this unnecessary conflagration with Iran.
Were the regime to fall and a version of democracy to take hold, I’d be the first to cheer Iran rejoining modernity. A bigger Dubai with better museums and restaurants, or more seriously a proper grown-up country with a global standing befitting its size, resources, and storied history.
However that end does not justify these means.
Veteran anti-American leftists must look back on President George W. Bush’s laborious efforts to establish a coalition and a cause for the Iraq war as fantastical. Something more akin to the Council of Elrond in The Lord of the Rings compared to this president, who sets the Middle-East ablaze one week then mutters about ‘taking’ Cuba the next [21].
But maybe you’re one of those supposedly tough-minded realists who thinks we’re just seeing how the world was always run, now President Trump has bravely pulled down the curtain?
Firstly, you’re wrong. This isn’t how the Western world was run for the past 80 years. (Granted it’s how it’s sometimes run in banana republics, or under African tyrants).
But secondly, there’s nothing tough about smashing stuff up for no good purpose other than to make a lot of noise to please your base [22] and satisfy your ego.
Hard things require hard work [23], as well as holding your tongue and sometimes your power.
As Canadian PM Mark Carney eloquently put it [24] at Davos in February:
For decades, countries like Canada prospered under what we called the rules-based international order.
We joined its institutions, we praised its principles, we benefited from its predictability. And because of that, we could pursue values-based foreign policies under its protection.
We knew the story of the international rules-based order was partially false, that the strongest would exempt themselves when convenient, that trade rules were enforced asymmetrically. And we knew that international law applied with varying rigour depending on the identity of the accused or the victim.
This fiction was useful, and American hegemony, in particular, helped provide public goods, open sea lanes, a stable financial system, collective security and support for frameworks for resolving disputes.
The rules-based order that some now scorn is exactly why the West enjoyed many decades of relative peace and prosperity.
But it’s also why, for instance, China was able to pull a billion people out of poverty, and why – and always most importantly and easiest forgotten – why the post-nuclear horror film Threads [25] is still a work of fiction, as opposed to what happened last Tuesday.
Won’t anyone think of the despots?!
You might say the rules-based order was a lie that didn’t give Vladimir Putin or Kim Jong Un – let alone Saddam Hussein or any number of Central American dictators – a fair shake.
Fair enough, but at least be clear who you’re advocating for.
Similarly, you might find it refreshing to hear the leader of a nuclear superpower calling [26] his NATO allies cowards for not diving into the latest mid-season plot twist for the Trump White House.
But don’t complain when every other country starts pointing nuclear missiles at their neighbours as a consequence.
As Janan Ganesh points out in the FT [27] [Paywall] this week:
As of last month, there is for the first time in over half a century no binding agreement to limit nuclear arms between America and Russia, which have the world’s two largest arsenals.
What is this?
A wave of recklessness? Perhaps, but also a natural response to events.
If the worst that results from this circus is higher prices at US gas stations and another 20% down on the S&P 500 then we will have gotten off lightly.
But I’m inclined to worry that the unravelling of the post-WWII Western consensus will – eventually – come with a higher and bloodier bill.
Of course the United States is far from the first empire to grow fat, hubristic, and ignorant at the height of its power.
But it is the first to be run by a former TV game show host.
No wonder Wheel of Fortune, Jeopardy, and The Price Is Right seem to be the closest we have to a doctrine in Washington these days.
Housekeeping: email issues
It seems more Monevator emails have been going into spam and junk folders than even my critics’ complaints about my forays into politics would warrant.
The issue may be that I’ve been using URL shorteners to tidy up lengthy link addresses. So I’ll be cutting back on that.
Anyway if you’re reading this article on the website but you’re also an email subscriber who hasn’t seen an email for a while then please do double-check. Mark any Monevator emails you find in spam as ‘not spam’.
We’ve been doing three emails a week for many years now. That’s how many you should get!
Related, several dozen Monevator members [28] are not receiving member posts over email, so they must be reading them on the site. (Via the growing Mavens [29] and Moguls [30] archives perhaps).
If that’s how you want it then fine. But if you’re a member and you’re missing the emails, then please make sure you’re subscribed [31] to get all Monevator emails.
Re-subscribe if need be. (And again, look out for the confirmation email getting lost in spam…)
If that doesn’t work then please do drop me a line [32].
It’s our lovely Monevator members who keep the lights on around here these days, and I want you to read us exactly how best suits you.
Have a great weekend!
From Monevator
Year 3 withdrawal from the No Cat Food portfolio – Monevator [33] [Members [28]]
The wild last year of a linker – Monevator [34]
From the archive-ator: Why commodities belong in your portfolio – Monevator [35]
News
BOE vote 9-0 to hold interest rates steady on Iran war risks – Reuters via MSN [36]
IT failure locked out Hargreaves Lansdown’s customers – BBC [37]
UK housing costs rose 41% in five years, for owners and renters – Guardian [38]
Banks keep £100 contactless payments limit despite new powers – City AM [39]
Stopping gas dictating UK energy price could cut bills by £200, study finds – Guardian [40]
Revolut to IPO above $100bn, says former licence boss – City AM [41]
Comedian Sean Hughes’ £4m estate finally given to Shelter – Independent [42]
Five-Year Annualized Value Premium (Jan. 2021 – Dec. 2025)
[43]
Value is back – Verdad [44]
Products and services
Disclosure: Links to platforms may be affiliate links, where we may earn a commission. This article is not personal financial advice. When investing, your capital is at risk and you may get back less than invested. With commission-free brokers other fees may apply. See terms and fees. Past performance doesn’t guarantee future results.
Sub-4% mortgage rates vanish as banks pull deals – Yahoo Finance [45]
Typical new mortgage costs up £788 a year in a fortnight – BBC [46]
What next for mortgages and how long should you fix for? – This Is Money [47]
Average ‘shelf life’ of a mortgage is now just two weeks – Guardian [48]
Get up to £1,500 cashback when you transfer your cash and/or investments to Charles Stanley Direct through this affiliate link [49]. Terms apply – Charles Stanley [49]
Eight expensive mistakes to avoid when buying life insurance – Which [50]
Santander switch offer: £200 + Amazon gift card – Be Clever With Your Cash [51]
HMRC has a new ‘Tax Confident’ educational portal – GOV.UK [52]
Get up to £3,000 cashback when you open or switch to an Interactive Investor [53] SIPP. Terms and fees apply, affiliate link – Interactive Investor [53]
How does shared ownership work? – Be Clever With Your Cash [54]
Shrinkflation takes a bite out of Easter eggs – Guardian [55]
Making Tax Digital myths debunked – Which [56]
Homes for sale with uplifting views, in pictures – Guardian [57]
Comment and opinion
Side hustles and the UK tax system – Guardian [58]
Five ways to avoid triggering tax traps – Which [59]
Why private school isn’t worth the cost – Of Dollars and Data [60]
How to ‘peakspan’ your retirement – A Teachable Moment [61]
When the benchmark becomes a bet – Capital Allocators [62]
Private credit: for most, an asset-liability mismatch – A.W.O.C.S. [63]
Here’s why you are constantly fighting off scammers [Podcast] – Freakonomics [64]
Emotional yields of collectibles [Research] – Elroy Dimson et al via SSRN [65]
Naughty corner: Active antics
An unsustainable bubble is growing inside fintech – Forbes [66]
Waiting for the IPO wave – Arcadian [67]
Saba forces the wind-up of Edinburgh Worldwide – AIC [68]
Ten growth stocks to buy for the long-term – Morningstar [69]
Hyperscalers and hard hats – Sherwood [70]
The biggest active funds picked the right stocks, then fussed – Flyover Stocks [71]
AI is disruptive, but it isn’t a moat killer – Morningstar [72]
Venture capital doesn’t exist – Investing 101 [73]
Kindle book bargains
The End of Reality by Jonathan Taplin – £0.99 on Kindle [74]
Boomerang by Michael Lewis – £0.99 on Kindle [75]
Money Men by Dan McCrum – £0.99 on Kindle [76]
Economica by Victoria Bateman – £0.99 on Kindle [77]
Or pick up one of the all-time great investing classics – Monevator shop [78]
Environmental factors
Researchers turn waste plastic into vinegar – The Conversation [79]
The plastic detox – Guardian [80]
Trawling ban off Sussex coast sparks marine recovery – BBC [81]
England must allot 7% of land to nature and renewables to hit targets – Guardian [82]
The moment one polar bear took on a walrus herd – BBC [83]
Robot overlord roundup
The 12x bet on AI – Tom Tunguz [84]
A petri dish of human brain cells is playing Doom – Independent [85]
Judge issues AI warning as after landlord uses fake law defence – BBC [86]
How much computing power is in a data centre? – Construction Physics [87]
Parents think they know how kids use AI. They don’t – BBC [88]
Will AI replace financial advisors? – A Wealth of Common Sense [89]
Agents over bubbles – Stratechery [90]
Not at the dinner table
Why Labour’s Brexit focus has shifted from Leavers to Remainers – BBC [91]
Sadiq Khan cites £30bn GDP Brexit hit to London – Standard [92]
Inside the White House plan to sell the Iran war online – Politico [93]
Green leader Polanksi wants to back the ‘caring majority’ – Green Party [94]
US judge orders Trump administration to reopen Voice of America – BBC [95]
A whiff of stagflation – Paul Krugman [96]
You can just do things – N+1 [97]
Off our beat
Why has this meningitis outbreak spread so fast? – BBC [98]
RIP my profession (and probably yours too) – Hello, Mortal [99]
Ukraine is hanging anti-drone nets over cities – NPR [100]
Why Nigeria is burying its history under a mountain in Svalbard – Guardian [101]
From Hormuz to Malacca, global trade relies on five waterways – The Conversation [102]
One situation after another – The Atlantic [103] [h/t Abnormal Returns [104]]
The Cassandra and The Machine [105] – New Atlantis [106]
In favour of enjoying things on purpose – Raptitude [107]
And finally…
“It is easier to stimulate asset prices then it is to stimulate the economy.”
– Terry Smith, Investing for Growth [108]
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