Allies, Assets, and Authoritah!

Like a middle-aged guy going up for a layup in basketball, stocks barely got off the ground yesterday — but it was enough for the S&P 500 to notch another record high. The Nasdaq held strong. The Dow, though, remained grumpy in the corner.

The summer lull is enjoyable so far. Smooth sailing. But geopolitics, tariffs, and the occasional meme-stock fever dream are testing the keel. Markets are riding high, but investors with any mileage on them know a headwind when they feel it.

We noticed Financial Times columnist Rana Foroohar is picking up what we’re laying down. “We’re watching the scaffolding of the old global order being quietly dismantled,” she wrote yesterday.

Tariffs with a Side of Sushi

President Trump reached a deal with Japan, slapping a 15% tariff on imports — including cars — but sweetening the pot with a $550 billion joint investment fund to build in America.

Trump had previously threatened a 25% tariff, so this counts as diplomacy by subtraction.

Elsewhere, trade partners are getting mixed results. The Philippines managed a 1% tariff cut. Canada got a pat on the back. Europe is preparing to fight over tariff rates. Goldman Sachs now expects the average U.S. tariff rate to settle at 15%.

First Stellantis, Now GM

GM followed Stellantis with its own grim quarterly results, reporting a 35% drop in Q2 profits. Tariffs on imported parts cost the company $1.1 billion — and executives warned the damage will worsen next quarter.

Tesla reports today after the bell. Watch for more pain or clever accounting.

China’s Quiet Pivot to EU Factories

While the U.S. threatens and haggles, China is adapting. Instead of buying up European ports and power grids, Chinese firms are now building their own factories on EU soil — using generous local subsidies.

As one EU trade official told Politico, “This is no longer a buyout — it’s a build-in.”

It’s a logical extension of the country’s Belt-and-Road initiative, which helped pour billions of dollars of investments around the world – and a way to conquer via economics and complex trade relationships, not by warfare.

Travel Bans and Business Chills in China

The U.S. confirmed that a Patent Office employee is barred from leaving China. A Wells Fargo executive is reportedly also being held over an opaque criminal case.

Wells Fargo has now suspended all business travel to China. BlackRock is telling employees to use burner devices. Japanese firms are backing away. If this is Beijing’s investor welcome mat, it’s laced with thumbtacks.

China is also taking an early lead in the resource development race. More on that in Ripple Effect later today. We’ll also do a deep dive in the rare earth and natural resource markets with Shad Marquitz tomorrow on Grey Swan Live! at 11am EST.

Canada Boycotts American Booze

American spirits took a 66% nosedive in Canada after the government pulled them from shelves in retaliation for U.S. tariffs. It’s not just Jack and Tito’s: total spirit sales dropped 13% in the same period.

Canadian consumers are now actively avoiding American products. More than 60% say they’re spending less on U.S. goods. Soft power just got a little more watered down.

Trump Eyes Real Estate Tax Cuts

Trump is considering ending capital gains taxes on home sales. The move would supercharge the real estate market and likely set off a new round of asset inflation.

Jerome Powell, whom Trump told lawmakers “won’t be around long,” may have thoughts on the impact of such a proposal… if he gets to keep his job long enough to voice them.

SpaceX Investors Warned: Musk May Return to Politics

In tender offer paperwork, SpaceX warned potential investors that Elon Musk could re-enter politics. Given the $400 billion valuation and Musk’s recent Pentagon contract, it’s a relevant concern.

When your CEO is in orbit — literally and politically — risk management gets tricky.

Kohl’s Goes Meme, Wall Street Goes Wild

Shares of department store chain Kohl’s more than doubled in early trading before settling up 38% — the moribund company became the latest darling of meme stock traders on Reddit.

No earnings beat. No turnaround plan. Just nostalgia, volatility, and a lot of shorts to squeeze.

Fourteen stocks in the Russell 3000 have tripled since April — most of them unprofitable. Meme stocks are back.

Like a rash.

South Park, Streaming Rights, and a White House Lawsuit

Trey Parker and Matt Stone inked a $1.5 billion streaming deal with Paramount after a heated rights battle — one that bizarrely entangled the White House. Paramount recently settled a $16 million lawsuit with Trump over merger approval.

With the 27th season of South Park premiering tonight, the show that skewered everything is now Exhibit A in political-media theater. Respect their authoritah!

Farewell, Ozzy

Ozzy Osbourne, the Prince of Darkness, has died at 76.

He leaves behind a legacy as both a rock legend and a chaotic representation of disfigured pop culture. Perhaps a toast to the Brit with something Canadian.

Tariff inflation has not yet appeared. Nor have we been plunged into a deep recession. Yet.

Feels like we’re a Truth Social post away from something sinister in the real economy – jobs, savings, consumer debt – from rearing its canary head. (See what I did there? Ozzy famously bit off a bird’s head during a concert in Des Moines in 1982.)

The new tariff regime is, however, shaping earnings, redirecting global capital, and triggering diplomatic retaliation. “The system isn’t breaking,” one Bloomberg columnist wrote yesterday. “It’s bending itself into a new shape.”

The gentleman investor knows: the scaffolding of a new economic world order is in its early stages.

~ Addison

P.S.: Speaking of the stuff civilization is made of, join us tomorrow on Grey Swan Live! with Shad Marquitz: Rare Earth, Real Opportunities — a deep dive into rare earths, uranium, and the defense department’s quiet scramble in the U.S.–China tech arms race.

Shad regaled us last time with a litany of tickers he likes in the natural resource space. We covered rare earth minerals, uranium and nuclear energy, precious metals and building materials – many of which have now outperformed the S&P 500, but are still in the early stages of a multi-year rally as the global financial system meets MAGA.

Tomorrow’s call will give us a chance for another full run down with Shad. He’s very articulate on investing in natural resources. If you’re interested in this overlooked space that’s starting to heat up again, you’ll want to join us Live!

Don’t miss it.

Your thoughts? Please send them here: addison@greyswanfraternity.com

Tariffs with a Side of Sushi

President Trump reached a deal with Japan, slapping a 15% tariff on imports — including cars — but sweetening the pot with a $550 billion joint investment fund to build in America.

Trump had previously threatened a 25% tariff, so this counts as diplomacy by subtraction.

First Stellantis, Now GM

Tesla reports today after the bell. Watch for more pain or clever accounting.

China’s Quiet Pivot to EU Factories

As one EU trade official told Politico, “This is no longer a buyout — it’s a build-in.”

Travel Bans and Business Chills in China

The U.S. confirmed that a Patent Office employee is barred from leaving China. A Wells Fargo executive is reportedly also being held over an opaque criminal case.

Canada Boycotts American Booze

Canadian consumers are now actively avoiding American products. More than 60% say they’re spending less on U.S. goods. Soft power just got a little more watered down.

Trump Eyes Real Estate Tax Cuts

Trump is considering ending capital gains taxes on home sales. The move would supercharge the real estate market and likely set off a new round of asset inflation.

Jerome Powell, whom Trump told lawmakers “won’t be around long,” may have thoughts on the impact of such a proposal… if he gets to keep his job long enough to voice them.

SpaceX Investors Warned: Musk May Return to Politics

In tender offer paperwork, SpaceX warned potential investors that Elon Musk could re-enter politics. Given the $400 billion valuation and Musk’s recent Pentagon contract, it’s a relevant concern.

When your CEO is in orbit — literally and politically — risk management gets tricky.

Kohl’s Goes Meme, Wall Street Goes Wild

Shares of department store chain Kohl’s more than doubled in early trading before settling up 38% — the moribund company became the latest darling of meme stock traders on Reddit.

No earnings beat. No turnaround plan. Just nostalgia, volatility, and a lot of shorts to squeeze.

Fourteen stocks in the Russell 3000 have tripled since April — most of them unprofitable. Meme stocks are back.

Like a rash.

South Park, Streaming Rights, and a White House Lawsuit

With the 27th season of South Park premiering tonight, the show that skewered everything is now Exhibit A in political-media theater. Respect their authoritah!

Farewell, Ozzy

Ozzy Osbourne, the Prince of Darkness, has died at 76.

He leaves behind a legacy as both a rock legend and a chaotic representation of disfigured pop culture. Perhaps a toast to the Brit with something Canadian.

Tariff inflation has not yet appeared. Nor have we been plunged into a deep recession. Yet.

The gentleman investor knows: the scaffolding of a new economic world order is in its early stages.

~ Addison

Don’t miss it.

Your thoughts? Please send them here: addison@greyswanfraternity.com

What we’ve seen since 2008 is nothing short of a theft of the commons. Except it happened in little pieces that seemed unrelated at the time. But if we look at the story holistically, it all comes together.

When we step back and view the entire picture, what emerges is not just a story of market excesses and economic shifts. What we see is the gutting of middle America – be it intentional or otherwise.

Now the question is – are we going to see the restoration of the American middle class in the coming years… or are we going to watch everything devolve into a modern redux of the War Between the States, more commonly but mistakenly known as the American Civil War?

Today’s Washington isn’t governed so much as stage-managed.

Politicians don’t solve problems; they perform them.

The current fixation is affordability — a word that will be repeated ad nauseam from now through the 2026 midterms, until it becomes as meaningless as “bipartisan.”

The script hasn’t changed in decades: promise relief, pass a law that raises costs, blame capitalism, hold hearings, fundraise, repeat.

Yes, Nvidia’s profits are up 500%, and its share price followed suit — a rare case where the story actually matches the math. But that’s the exception, not the rule.

Beneath the headlines, we’re starting to see the kind of financial gymnastics — circular lending, balance-sheet origami, and creative “partnerships” — that usually signal the boom is running out of breath.

If history rhymes, it looks like we’re closing in on the tail end of a mania.

As interest rates fell, investors swarmed into real estate, lured by yields and the illusion that home prices never fell. Wall Street’s private-label securitizers were soon packaging everything from pristine mortgages to what were effectively loans scribbled on napkins, thus turning them into bonds that glowed like gold — until you looked too closely.

For their part, the regulators and ratings agencies conveniently looked away and allowed the bubble to grow. Fannie Mae watched the frenzy from the sidelines at first.

The company’s mandate — written in law — was not to chase profits but to promote affordable housing. That is to say, to make sure that teachers, nurses, and other first-time buyers could own their own homes and unlock the American Dream.

But as Wall Street flooded the market with high-risk mortgage products, political pressure mounted. Congress demanded that Fannie “do its part” for low and moderate-income families.

Today’s Washington isn’t governed so much as stage-managed.

Politicians don’t solve problems; they perform them.

The current fixation is affordability — a word that will be repeated ad nauseam from now through the 2026 midterms, until it becomes as meaningless as “bipartisan.”

The script hasn’t changed in decades: promise relief, pass a law that raises costs, blame capitalism, hold hearings, fundraise, repeat.

Yes, Nvidia’s profits are up 500%, and its share price followed suit — a rare case where the story actually matches the math. But that’s the exception, not the rule.

If history rhymes, it looks like we’re closing in on the tail end of a mania.

For their part, the regulators and ratings agencies conveniently looked away and allowed the bubble to grow. Fannie Mae watched the frenzy from the sidelines at first.

But as Wall Street flooded the market with high-risk mortgage products, political pressure mounted. Congress demanded that Fannie “do its part” for low and moderate-income families.