War embargoes trigger a recurring cycle: supply shocks drive price spikes, speculation surges, trade routes shift, and liquidity tightens. The Civil War cotton crisis mirrors the 1970s oil shocks and today’s energy markets—featuring demand destruction, falling real incomes, and cost-push inflation. These booms end in crashes, as capital misallocation and banking stress unwind the speculative excess.
Solid-state batteries may disrupt lithium-ion more than markets price in. They use lithium-metal anodes and solid electrolytes, boosting energy density, safety, range, and charging speed. But success depends less on chemistry than new manufacturing: continuous ceramic or roll-press processes, not legacy liquid-electrolyte lines. The thesis argues incumbents like CATL face retrofit and scale hurdles, while Honda and QuantumScape may hold undervalued final-size production advantages.
The text challenges three beliefs: rising gas prices, renewables increasing costs, and higher renewable penetration raising German prices. Data from Spain and Germany shows renewables lower prices via the merit-order effect. Germany is moving toward similar outcomes, aided by rapid storage expansion (batteries, sand, molten salt). Seasonal storage and low marginal costs reduce gas dependence, stabilize prices, and improve energy sovereignty, with full decoupling expected by 2027–2030.
In the 1820s, post-Napoleonic UK cut gilt coupons. Investors, denied real yield, chased returns in speculative ventures, funding dubious projects. Gilt demand collapsed, causing banking instability; the Bank of England injected liquidity. Today's parallel: US yield repression fuels risk-taking, lower-quality credit, Fed monetization. Gundlach warns a Treasury coupon cut could repeat this: yield-seeking bubble, credit deterioration, contraction. Lesson: cheat on debt, get a bubble, then a bust.
The Minsky clean-up is not unique to today or the US. A similar dynamic occurred in the UK in 1825 after post-war debt led to changes in gilt coupons. Today’s SPAC boom echoes past speculative excesses. As always, the cycle turns when credit tightens. Cutting gilt coupons has two key effects: it shifts relative yields and disrupts credit markets.
AST SpaceMobile aims to deliver space-based cellular broadband directly to standard smartphones via large BlueBird satellites and proprietary software. It partners with major telecoms, using their spectrum in a B2B model. However, high CapEx, short satellite lifespan, and strong buyer power pressure margins. Competition from SpaceX, Amazon, and Apple threatens its moat. Despite a compelling vision, its valuation appears overly optimistic given risks and capital intensity.
Private credit and banking rules increasingly distort risk signals. Mark-to-model (ASC 820) enables wide valuation discretion. New delinquency rules erase long-term stress after 12 months, improving NPLs mechanically while weakening analysis and delaying warning signals (NIM impact). CDS lacks coverage in private credit. LIBOR’s narrative is contested, yet SOFR replaces a forward-looking rate with a backward-looking one, removing embedded market expectations and degrading visibility of risk.
Molten salt systems retrofit coal plants into thermal batteries: excess wind/solar heats salt, stored energy later drives turbines. Fuel is eliminated, costs shift to capex, and long-duration storage (days–weeks) becomes cheap. This “Carnot battery” model undercuts gas by absorbing surplus and serving peaks, turning coal assets into dispatchable, fuel-free power hubs.
ECB critics misread inflation: echoing Henry Thornton, supply shocks (like energy or bad harvests) create temporary imbalances, not monetary excess. Raising rates won’t fix supply and can worsen it by choking credit and slowing adjustment (e.g. renewables). The right response is real-side adjustment, not tightening, especially with cartelized energy prices.