Softly and Uply are the key concepts early today. Because, as we anticipated on the Peoplenomics.com site this weekend, the real action should come late-week.
European bourses were up early. Asia was a different story: The KOSPI was down 3.65% overnight. This South Korean index traded around 9,150-ish not long ago (late June). But as of today, it has lost about a third of that pricing. What’s driving it? Glad you asked – pick one:
- Tech / semiconductor sell-off: Samsung Electronics and SK hynix (the two heaviest weights) both fell roughly 4.4–4.5% overnight. The market reacted to AI profitability worries after reports that OpenAI’s annualized revenue was around $50 billion, below the ~$70 billion figure circulating earlier. There was also chatter about Chinese memory competition (CXMT planning new DDR5 server products) and questions about how durable the semiconductor supercycle is, even though Samsung had just guided record quarterly operating profit.
- Heavy foreign selling: Foreigners were large net sellers (around 2 trillion won on the day). Cumulative foreign selling in KOSPI this year is approaching or exceeding 200 trillion won, with semiconductors accounting for a big share. High U.S. Treasury yields (10-year above 5%) and risk-off sentiment reduced the appeal of Korean equities.
- Middle East / inflation pressures: Renewed Houthi attacks on Saudi Arabia’s main airport over the weekend pushed oil higher and revived energy-supply and inflation concerns. That feeds into worries about further rate pressure.
- Technical / supply factors: ETF rebalancing in semiconductor products, the end of treasury-stock buybacks by the big chip names, derivatives expiries, and the market breaking key technical levels all amplified the move. Profit-taking after the recent run above 7,000 also played a role.
I’m drawing your attention to South Korea for several reasons.
First, this could be a “poster child” for what an AI-driven blow-down could look like. A third off a market index is something your average investor frames as “unthinkable” – until they’ve been through one.
Second is the timing of this week: Bond Market is closed for Columbus and Indigenous Day but the other casinos are open. But I suspect our work – and that of The Economic Fractalist will combine – and potentially in a very “Korean sort of way” if the inflation report Wednesday is fugly.
Third, our 1929 Replay Model is primed for collapse. We update the ChartPack twice weekly for subscribers.
We have been writing about “the Big One” for more than 25-years here. And a few “questioning skeptics” have to be wondering “Where is the Super Blow-Off – the one that would give 1929 a run for the money?
The answer is complicated – so put on the multivariate hat and follow along.
- After the 1929 Collapse, a great deal more financial control was applied with levers. Social Security, FDIC, and the modern analog to the CCC/WPA – the AmeriCorps.
- Housing Bubble Collapse and COVID knocked some of the “liquidity edges” off a bit. Tightening the border reduced syn-growth demand, and a new American militancy cost oodles.
- And then it’s what TEF sharply observed: “How much higher would the SPX have peaked without the concurrent energy prices and inflation secondary to the Ukraine war, Iran war, and ever mutable trade policies?”
So our (modest) advice to all is simple this week. Get your head “off the rails” before Wednesday because the train to the future is coming through. You want to be on it.
Not under.
News Compressor: ON
News flows today at mainly “coloring inside the [statistical] lines.” Even our AI offspring are lining up assessing kick-off today this way:
AMBER — SELECTIVELY HARDENING
The dominant development is the growing difference between what governments are announcing and what physical systems are actually doing.
Military activity continues despite ceasefire language. Energy markets are responding to possible additional supplies before delivery is assured. Financial markets remain resilient even as participation narrows and geopolitical risks accumulate.
That combination deserves attention, but it is not proof that a systemic break has begun.
The immediate watch: Saudi aviation and shipping security, implementation of the proposed Russia–Ukraine energy ceasefire, and Tuesday’s return to fuller U.S. bond-market trading.
The scheduled financial hinge: Wednesday’s CPI release.
As a result, the four front page items right now are:
1. GULF / ENERGY — Another Saudi airport attack; diplomacy has not restored shipping security. Saudi authorities reported another fatal attack on Riyadh’s international airport Sunday, following Saturday’s Houthi-claimed strike, whose reported death toll rose to 13; Sunday’s attack killed one additional person and injured 11. Tanker attacks and continuing disruption around Hormuz and Bab el-Mandeb are keeping pressure on energy transportation, while Iran says it is still reviewing Washington’s response to its proposal for reopening Hormuz. Escalating militarily; diplomacy remains unresolved.
2. RUSSIA / UKRAINE — An announced energy ceasefire encounters immediate contradictions
President Donald Trump announced an energy ceasefire, but Ukraine said Russian attacks on its energy facilities continued, and Moscow had not confirmed the agreement. If the rumor holds through tomorrow’s close, this could be our maraschino.
3. UNITED STATES / DISASTERS — Hurricane damage spreads north; another storm affects the Southwest. At least four deaths were attributed to Hurricane Isaias after its Florida landfall, while flooding and landslides affected western North Carolina and approximately 226,000 customers remained without electricity in Florida and Alabama Sunday evening.
Separately, Rachel’s remnants damaged Southern California coastal properties and contributed to flooding around Las Vegas. Wind damage subsiding; flooding and recovery pressures are continuing.
4. INDIA — Voter-list controversy becomes a national political confrontation
Authorities closed six Delhi metro stations and restricted traffic Monday as opposition groups marched toward the Supreme Court over voter-list revisions that removed more than 130 million names, including people recorded as deceased, relocated, or untraceable. Say, you don’t think this is a “prequel proxy” do you?
Speaking of mid-terms: A federal judge temporarily blocked taxpayer funding for television advertisements featuring President Trump after plaintiffs alleged the advertisements were political rather than public-service communications. Odds of more legal mud-wrestling approach 100%.
Monday in the Break Room
People will talk about?
1. At least 139 migrants died and 84 remained missing after an overcrowded boat capsized off Djibouti while traveling toward Yemen, according to the International Organization for Migration.
2. Taiwan said it was monitoring Chinese live-fire exercises scheduled along several coastal areas this week, although none of the announced exercise zones directly surrounds Taiwan.
3.. An Israeli strike killed two people in southern Gaza Monday, according to Palestinian medical officials, as disputes over ceasefire compliance and militant activity persisted.
4. Flooding (replay basis the late August flooding) caused by a landslide-blocked river in Nepal destroyed bridges and hiking trails, leaving more than 100 foreign trekkers stranded.
5. Poland deployed more than 20,000 police officers to schools following several stabbing attacks, including fatal violence at an educational facility.
6. France anti-government wave seems passing:
By late last week the government reported a clear drop in school blockades (down to roughly 140 closed high schools out of ~3,700). Most schools are open again. But what’s this? Fire destroyed much of the historic Marché des Enfants Rouges covered food market in Paris, with investigators still determining the cause. Link? Inquiring minds file…
7. Wildfires spread into residential neighborhoods in Indonesia’s Bangka Belitung province, damaging more than 300 houses and forcing hundreds of residents to evacuate.
8. The International Monetary Fund said AI infrastructure investment was helping sustain global economic growth near 3% despite energy shocks, while warning about consequences for employment and economic inequality. Might want to check with South Korea on that.
Around the Ranch: Perceptual Standing
Yes – another book may be in the works: “Managing Your Animal” and it’s about how resident consciousness gets on while “locked into an animal body” around the time of birth. But I should back up and explain why this matters.
Lost you, did I? The market analyst and the consciousness investigator face essentially the same problem: their conclusions depend on their starting assumptions, observational position, and methods of interpretation. Trading is an odd little corner of larger Reality.
Worthy of mention, turns out, in this study of how broader Reality works, that “where you stand” matters greatly;
In my books, I like to begin from the standpoint of “What would a rational person see/think if they begin inside their own animal/spirit vehicle?
I think of this as the problem any sea captain faces before shoving off: Where is the ship now (here and now in body space-time) and where are we going?
I had previously been firmly locked onto this path. Where “You discoveries will depend on your starting point for these rides around the Sun.”
BUT – getting deeply into it – turns out there is an interesting “off in pure math and physics” way of resolving destinations of lives. And it’s well articulated in a series of 2016 papers by Mohsen Paul Sarfarazi, PhD.
A good starting point is his online collection of papers beginning with “A Higher Dimensional Account of Creation – Part 1 – Light of Consciousness.”
Conceptually interesting materials. But, to this particular animal/spirit package (me) it’s easier to “follow the breadcrumbs of memory back to Source” rather than trying to “build a Source Theory and then see if you can get to “here and now” from there.
Near as I can figure, both approaches are likely workable. Big Source Theory and down to present can make the math-brain hurt, however. But going back “up the trail” the risks are self-delusion and distraction.
Bottom line? Figuring it all out – the universal Big TOE (theory of everything) – still has an uphill climb ahead.
And not made easier by researchers (like Sarfarazi) who are “protecting their work copyright” by only publishing images on the web, not text. Which makes conventional indexing (and AI too) more difficult to find. Trying to “own expression of ideas” (via images and copyright) is a rational stretch, to our thinking, however.
Then again, maybe that’s the point?
Write when you get rich,
George@Ure.net