Peace, peace!' When there is No Peace

The week ended on July 3, 2026, interesting news items to look at for the past fortnight are:

1. Peace, peace!' When there is No Peace: There is a Chinese proverb that says “聽其言,觀其行”which means caution dictates that one should “listen to his utterance but observe his actions.” To this I further remind myself of what Jesus says in Matthew 12:34 “For out of the abundance of the heart the mouth speaks.” It was less than two weeks before the US spilled her beans in public about her true intentions for signing an “MOU” with Iran. (Fig. 1).

A strategic pause, an opportunity to replenish her oil reserves, stabilize the markets, and time for military regrouping and preparation.  

(i) US Strategic Oil Reserves at Historic Low - The US Strategic Petroleum Reserve (SPR) has fallen to roughly 325 million barrels, its lowest level since May 1983. (Fig. 2).

So shortly after signing the MOU, US behaved as if Iran had given up control of traffic in the Strait of Hormuz and moved oil tankers without further reference. Iran, however, is not deceived after having been bitten twice before in negotiations with US and Israel under their cloak and daggers. .(Fig. 3).

Skirmishes flared just 10 days after the MOU.

(ii)  Post-MOU skirmishes - There were 4 separate military confrontations after the MOU, namely

(a) Strait of Hormuz Retaliatory Strikes: The US military launched a series of airstrikes on Iranian missile storage, coastal radar, and minelayer capabilities in the Strait of Hormuz. The US Central Command (CENTCOM) described these actions as direct responses to Iranian drone attacks on Panama-flagged and other commercial tankers traversing the strait.

(b) Persian Gulf Skirmishes: Iranian military units retaliated to US strikes by deploying drones and missiles that targeted US-aligned interests in Kuwait and Bahrain.

(c) Escalations in Lebanon: The US-Iran MoU specifically declared an immediate termination of hostilities on all fronts, including Lebanon. However, both sides traded reciprocal strikes after Iran accused the US of permitting Israel to continue occupying Lebanese territory in violation of the treaty. 

(d) Continued Southern Lebanon Engagements: The Israeli military continued its military presence in southern Lebanon and launched airstrikes against Hezbollah targets.

(iii) IRGC declared the Strait of Hormuz closed again - Iran declared the Strait of Hormuz closed again on June 20, 2026. The military stated the move was in retaliation for Israeli strikes in southern Lebanon, which Tehran claimed was a violation of a recently signed ceasefire memorandum of understanding with the United States.

(iv) Trump Declared National Emergency and Food Crisis - President Donald Trump on Monday declared a national emergency aimed at protecting the U.S. food supply and temporarily suspended import duties on certain Moroccan fertilizer products. Under the presidential emergency declaration, phosphate fertilizer imported from Morocco will no longer face tariffs for up to eight months or until the emergency declaration is terminated. (Fig. 4)

The potential fertilizer/fod crisis for US is a self-inflicted wound as we can see through war, embargoes, sanctions, and through transit choke points that US  had painted itself into a corner. (Fig. 5) 

For Phosphorus - Russia, Saudi Arabia, and China combined account for 52% global share in exports. Potassium - Belarus, Russia and Canada combined account for 77%. Nitrogenous fertilizers - Russia, China, Oman, Qatar, Saudi Arabia, and Egypt a combined 46.5% global share.

By extension, through insurmountable supply-chain squeezes in rare earth and critical minerals, oil and gas, and finally fertilizers, the only way for the entire Western economy to go is down. Let us not fool ourselves. The MOU with Iran, the IPO of SPCX, the recent strength of US Treasuries and DXY and the take-down of precious metals is a kabuki theater and a short-lived respite performance of a dying empire. (Fig. 6).  

2. What’s Your Business: “The business of America is war, the business of China is business” is a signature critique coined by geopolitical trend forecaster Gerald Celente regarding the opposing global strategies of the two superpowers. (Fig. 7)

Look at the different solutions used in China and Europe to counter the current heat wave. (Fig. 8).

Look at the Chinese products flying off the shelves to Europe and draw your own conclusion as to who will have the last laugh:Western political elites who are ignoramuses except for lying and electioneering, or down to earth Chinese who provide solutions to anticipated needs. (Fig. 9)  

The advancement of AI certainly impacted our society; readers may have spotted that my writing has shortened, as I too have begun to adopt AI to provide more data in graphical form. That means the images has a much richer information content than before and may require more of your attention. Please let me know if this has become a distraction rather than an enhancement. Thanks again for investing your time in this blog.

Jeremiah 6:8  Be instructed, O Jerusalem, Lest My soul depart from you; Lest I make you desolate, A land not inhabited." 9  Thus says the LORD of hosts: "They shall thoroughly glean as a vine the remnant of Israel; As a grape-gatherer, put your hand back into the branches." 10  To whom shall I speak and give warning, That they may hear? Indeed their ear is uncircumcised, And they cannot give heed. Behold, the word of the LORD is a reproach to them; They have no delight in it.  11  Therefore I am full of the fury of the LORD. I am weary of holding it in. "I will pour it out on the children outside, And on the assembly of young men together; For even the husband shall be taken with the wife, The aged with him who is full of days. 12  And their houses shall be turned over to others, Fields and wives together; For I will stretch out My hand Against the inhabitants of the land," says the LORD. 13  "Because from the least of them even to the greatest of them, Everyone is given to covetousness; And from the prophet even to the priest, Everyone deals falsely. 14  They have also healed the hurt of My people slightly, Saying, 'Peace, peace!' When there is no peace.15  Were they ashamed when they had committed abomination? No! They were not at all ashamed; Nor did they know how to blush. Therefore they shall fall among those who fall; At the time I punish them, They shall be cast down," says the LORD.16  Thus says the LORD: "Stand in the ways and see, And ask for the old paths, where the good way is, And walk in it; Then you will find rest for your souls. But they said, 'We will not walk in it.' 17  Also, I set watchmen over you, saying, 'Listen to the sound of the trumpet!' But they said, 'We will not listen.' 18  Therefore hear, you nations, And know, O congregation, what is among them.:19  Hear, O earth! Behold, I will certainly bring calamity on this people—The fruit of their thoughts, Because they have not heeded My words Nor My law, but rejected it. 

 

Sell in May and Go Away

The week ended on June 19, 2026, interesting news items to look at for the past fortnight are:

Sell in May and Go Away: There is an age-old Wall Street adage that says, “Sell in May and Go Away” meaning that summer will follow and investors should close their books, have a bit of R&R then come back in November when action starts again. This adage certainly does not apply in 2026. (Fig. 1)

The fragile US/Iran Ceasefire MOU was finally electronically signed on Friday but not without Israeli sabotage of the deal through bombing in Lebanon. (Fig. 2).

 Washington was reluctant to officially disclose the details of the MOU but a senior U.S. Official read out loud on a conference call with reporters of what was purported to be the full text of the MOU. The official spoke on condition of anonymity under ground rules set by the White House. Details can be found in the link below: https://arabcenterdc.org/resource/memorandum-of-understanding-between-the-united-states-of-america-and-the-islamic-republic-of-iran/  .

In summary, the MOU contains:

(a) Military & Security - Full permanent ceasefire – Iran, the US, and allies halt all military operations on all fronts (including Lebanon).Respect for sovereignty – Both sides pledge non-interference in each other's internal affairs. Lifting blockade & troop withdrawal – US to lift naval blockade within 30 days; troops to withdraw from the region within 30 days after the final agreement is signed.

(b) Economy & Sanctions -  $300 billion reconstruction fund – Led by the US and allies (but the US will not contribute funds). Sanctions removal – Commitment to eventually terminate all sanctions; oil export waivers to be issued immediately after signing. Unfreezing assets – US to release roughly $24 billion in frozen Iranian assets after Iran fulfills its commitments.

(c) Nuclear & Implementation - Iran commits to “never build nuclear weapons" – Agrees to dilute existing high-enriched uranium, but key details are deferred to the 60-day talks. Status quo maintained – During negotiations, both sides keep the nuclear status quo; the US will not add new sanctions or troops. UN endorsement – Final agreement to be approved by a UN Security Council resolution.

On the surface, Iran had prevailed with its 14 points demand, the U.S. TACO and Israel put on its backfoot. The risks is whether the MOU would be implemented in full. The sudden and abrupt retreat by Trump begs the question of why. We have in the April 12 blog titled “Stone Age and Cease Fire” opined that a logical conclusion to the hostility should come in June and subsequently offered 4 areas of depletion that will lead to a US TACO. Another important milestone is that China restriction on exports of rare earths and critical minerals has begun to bite hard on the MIA in both the US and Japan. In the case of tungsten, which China controls over 80% of global supplies, not only are exports for military use restricted, but Chinese buyers have also moved to buy up scraps in US recycle yards to complete a chokehold against US weapons and munition manufacturing. (Fig. 3).

Without the ability to replenish its depleted armory, US may find it hard even to defend her own shores, much less to be a global bully with impugnity. One telltale sign of a more permanent peace in the ME is when the US aircraft carriers are pulled out; it would be difficult to send them back into the fray.  

(ii) Japan Re-militarization - China has moved against Japan in her military use of rare earths and critical minerals of Chinese origin. (Fig. 4)

Shin-Etsu Chemical has stopped accepting new orders for dysprosium-containing magnets, affecting high-end applications such as radar systems and electric vehicles. Kanto Denka & Central Glass: Have notified clients like Samsung of an indefinite suspension of production of tungsten hexafluoride (a critical chip material) starting July. Toyota & Panasonic: Rely on China for nearly 100% of the dysprosium (Dy) and terbium (Tb) used in their motors. If the supply cutoff persists, production lines could halt within weeks. A top executive at a major Japanese manufacturer has publicly warned that "factories may be forced to shut down." At the G7 meeting in France on June 16, Prime Minister Sanae Takaichi warned that China’s measures against Japan risked disrupting partner nations’ supply chains and called on G7 members and multilateral development banks to build more resilient mineral supply chains. G7 leaders agreed to coordinate stockpiling of critical minerals and reduce dependence on any single dominant supplier outside the G7. They also agreed to launch a new coordination platform with an expanded role for the International Energy Agency (IEA) to monitor markets and flag supply risks. Yes, all well and good for photo ops, but Takaichi truly left reeling.

(iii) Space X - Space X IPO was initially oversubscribed by only 2 times, but late institutional demand, on news of an end to the Iranian war, pushed demand to 3.5 times. There were every sign of Wall Street skimming the top at a very late hour of the tech bull run. Retail investors were allocated 30% (instead of the usual 5%-10%). The stock was fast-tracked into CRSP Index, MSCI-Global Standard, Basdaq-100, FTSE-Russell and S&P 500 without a waiting period, thereby ensuring that retail retirement funds heavily invest in passive investment vehicles like Index Funds and ETF were duly stuffed.  With the usual trick of over-allotment and early trading stabilization purchases, I am sure SPCX share price won’t disappoint for the first two weeks; thereafter, who knows.

(iv) Fed Chair Warsh first FOMC Meeting - Key Takeaways from the June 17, 2026 Meeting: (a) Rate Decision: The Fed maintained the status quo by holding rates steady. (b) No Dot Plot Projection: In a break from tradition, Warsh refrained from offering his own personal dot plot projections for interest-rate trajectories. (c) Hawkish Shift: Despite the pause, updated projections from other committee members indicated an increased belief that rate hikes could be on the horizon for 2026 to combat inflation, and (d) Market Reaction: The hawkish tone and emphasis on price stability caused a spike in Treasury yields, with the 2-year note experiencing its biggest jump on a Fed meeting day since March 2008.

Despite the rhetoric, after Warsh appointment, the Fed continued to expand its balance sheet and money supply. (Fig. 5).

My prognosis is US has a more pressing need to stabilize the dollar first; the bond market becomes secondary. US probably hopes that when oil prices come down as the ME ceasefire sets in, a lowering of interest rates may be opportune.

We have persistently presented our thesis that US Treasuries issuance has already passed a market saturation point and that a precipitation is a certainty. (Fig. 6).

Immediately after the FOMC meeting, gold and silver were heavily hammered in the derivatives market (Fig. 7).

This is despite foreign Central Banks contiued their buying spree to diversify away from dollar risks. (Fig. 8).

The Bullion Banks are in a panic as a fresh call by Trump to once again audit US Gold Reserves at Fort Knox. (Fig. 9).

It is understood that for every physical ounce of gold held by banks, there were customer claims of 147 ounces, and for every ounce of silver, 392 ounces of customer claims. (Fig. 10).

No doubt, there would not be many more opportunities for Bullion Banks to square off their naked short positions when some Gulf Council State Members are forced to liquidate their bullion holdings to pay for state admin expenses when their revenue are halted.

Philippians 4:4  Rejoice in the Lord always. Again I will say, rejoice! 5  Let your gentleness be known to all men. The Lord is at hand. 6  Be anxious for nothing, but in everything by prayer and supplication, with thanksgiving, let your requests be made known to God; 7  and the peace of God, which surpasses all understanding, will guard your hearts and minds through Christ Jesus. 8  Finally, brethren, whatever things are true, whatever things are noble, whatever things are just, whatever things are pure, whatever things are lovely, whatever things are of good report, if there is any virtue and if there is anything praiseworthy—meditate on these things9  The things which you learned and received and heard and saw in me, these do, and the God of peace will be with you. 

Patience or Inertia

The week ended on June 5, 2026, interesting news items to look at for the past fortnight are:

Patience or Inertia: For the past two weeks, the main political and conflict theaters have seemed to be in a state of suspended animation, with “skirmishes” but stabilized front lines.  My humble assessment is that there now appears a clear delineation between Patience on the Global South and Inertia on the Western Hegemon. (Fig. 1).  

One telltale sign was that immediately after Taiwan KMT leader Cheng Li-wun returned from her visit to Beijing, an inner circle of the Trump administration secretly flew to Taiwan to try to extract details of the conversation between Li and Xi. This was leaked yesterday by Dr Julian Kuo, a respected political commentator who served for 3 terms in the Taiwan Legislative Yuan. Another indicator is the constant illusion by Trump of a deal when all that existed was a monologue to the Pakistani intermediary, without the principals talking to one another. (Fig. 2)  

Now “Patience” is the deliberate, conscious choice to endure waiting while remaining engaged, whereas “Inertia” is a passive, unconscious resistance to change. While both states can involve a pause in forward motion, patience is anchored in purpose and emotional control, whereas inertia is defined by stagnation and the path of least resistance. The “Core Difference” between the leaders’ psyche would almost certainly determine the eventual outcome. (Fig. 3).

Let’s gather a few data points below to see why ?

(i) Depletion of Munitions - A recent report by the Centre for Strategic and International Studies and echoed across the New York Times and the Wall Street Journal, is US faces significant depletion of high-end precision munitions, and it will take one to six years to replenish. (Fig. 4).

Additionally, over 1,000 Tomahawk Cruise Missiles (25% of the total US inventory) have been expended in 39 days against Iran with a Pentagon procurement program of just 57 in the 2025 defense budget.  What is missing from the narrative is the replenishment of these munitions; this is predicated on obtaining critical minerals and rare earth from China, which is a hurdle the US cannot overcome within the next 10 years.

(ii) Depletion of Domestic Political Support -  On Wednesday, the US House of Representatives moved to limit PONTUS powers to war in Iran (Fig. 5).

Trump’s approval rating also fell from an initial 52% TO A LOW 38%. On similar grounds, the Israeli Knesset also passed a bill to dissolve the parliament for an early election. (Fig. 6).

 (iii) Depletion of Ally Support - The worsening economic conditions from the Ukraine and Iranian wars have alienated US ally support from Europe, Asia, and the Middle East. It was said that Bessent was furious as Japan aggressively sold Treasuries to defend the exchange value of a weak Yen. (Fig. 7).

(iv) Depletion of Funds - ECB reported this week that gold accounted for 27% of global central bank reserve assets at the end of 2025. That was up from 20% a year earlier. By contrast, the share of US Treasuries fell to 22% from 25% over the same period. (Fig. 8).

For students who followed global de-dollarization closely, the news is 9 months behind the first report of this phenomenon, which initially appeared on August 27 2025. (Fig. 9).  

Nonetheless, it is still significant for the establishment to formally acknowledge that the established order has lost its grip.

 

Luke 14:31  Or what king, going to make war against another king, does not sit down first and consider whether he is able with ten thousand to meet him who comes against him with twenty thousand? 32  Or else, while the other is still a great way off, he sends a delegation and asks conditions of peace. 33  So likewise, whoever of you does not forsake all that he has cannot be My disciple.