Morning everyone.
Some crazy shit to cover today. I think it is worth noting that this is the exact type of global environment I decided to start Arb Letter in.
Wars, potential pandemics, government scandals, asset inflation, crypto turning mega bullish, new psy ops, etc.
It’s all ramping up again and my goal has always been to be the last newsletter you ever need to subscribe to if you actually want to stay up to date on markets, crypto, geopolitics, society, and how the world is changing.
We have a whole range of major updates to cover this morning:
The Russian Plague case(s) in Siberia that are still in the news cycle
The State Department is urging visitors to leave Russia
The S&P hitting an all time high, stocks we are watching
Crypto continuing to look like the next leg higher is soon, what is likely to pump
Migrant riots and unrest in the UK and France (France looks like a literal warzone)
Foiled terror plots and threats developing globally
The end of the year is shaping up to be quite the party. We’ve got a good schedule of posts to drop in October on everything from crypto sleeper picks to foreign equity highlights and emerging political threats across the West.
If you missed September’s top post make sure to take some time to check it out this week.
Markets & Crypto
It’s funny, despite the onslaught of negative headlines and press globally markets have proven to be incredibly resilient in 2026.
The S&P 500 and Nasdaq both just hit new all time highs as equities continue to climb higher and higher. Barchart has reported that tech stocks are now outperforming the rest of the S&P 500 by the largest margin in history.
The AI wave still has some juice left in it and technology continues to make it easier than ever before for retail to gamble and participate in markets.
Unfortunately yields are still going buck wild, US 30-year Treasury yield have risen to 5.75% and the market is in the red so far today with some outlets reporting over $350B has been wiped so far. Even precious metals like Gold and Silver sold off to the tune of about $900B. As far as yields are concerned, for readers, that just means more expensive mortgages, tougher financing conditions for businesses, and a larger interest bill for Washington as debt keeps getting refinanced.
Ahead of midterms though, we have to ask ourselves if this will be allowed to continue. I doubt it, Trump cannot risk heading in with market in absolute free fall. Granted there is only so much he can do about it, but still.
My bias remains bullish until proven otherwise with consecutive weeks of pain this Fall.
But to play devil’s advocate there is a camp of believers who firmly think we are closing in on the bubble burst.
Michael Burry is convinced that we are closing in on the mega top of markets, posting the tweet above to X. Now it’s worth pointing out this dude has been expecting another market apocalypse for like 10 years now but the strongest bear case to me is likely that political incentives cannot indefinitely outrun the math. If borrowing costs stay elevated, refinancing gets harder, earnings this season disappoint, and we see investors start questioning how much they are paying for future growth….. then things get dicier.
The White House can change their policy and messaging, but they cannot dictate Treasury yields, corporate profits or the Warsh’s Feds next move. I would be careful about building an entire investment thesis around the assumption that someone will step in and save your portfolio.
SpaceX SPCX 0.00%↑ has surged to $175+
Paramount has officially closed its deal to acquire Warner Bros. Discovery (Unusual Whales - NYT)
Saudi Arabia announces its East-West oil pipeline is back up to 5.8 million barrels per day, allowing crude to bypass the largely closed Strait of Hormuz (Polymarket)
Google and Constellation Energy strike a sweeping deal centered on nuclear power (CoinTelegraph)
There are two main themes I am watching closely in equity land right now.
The first is defense. We’ve been bullish on defense for awhile, but the results have been a bit stalled.
My read is that investor mindshare is shifting toward companies like Palantir and privately held Anduril, with more excitement around AI, autonomous systems and software than the traditional defense giants. The spending thesis still makes some sense to me, but being right about rising military budgets doesn’t automatically mean we’ve picked the biggest winners.
Regardless of the lagging performance I think the situations in Eastern Europe and the Middle East are reason enough to remain long. On top of that you have Trump’s announcement with Anduril on this new mega ship building center which is absolutely a nod towards the long term China threat.
I am still long ONDS 0.00%↑ LMT 0.00%↑ LHX 0.00%↑ and PLTR 0.00%↑ but at this point may be looking to shift some of my attention to the domestic plays ahead of midterms (my second theme I am watching).
I have spoken about AXON 0.00%↑ which is now down 18% on the month, a range where I am comfortable to start adding more of it.
Additionally, Motorola Solutions (MSI) could be solid with police communications, video security and command-center systems. This gives you direct exposure to public safety spending which would bump in the event demonstrations or unrest grows in the midterm season and leading into the next presidential election down the line.
Latin America
Many of you have likely heard me post about the stark observation in Latin America we have observed since the ending of USAID.
No left wing government or candidate has been successful since (no doubt because all of the funding got pulled). But amid the chaos I think there is an opportunity to be had. Polymarket is providing some great insight into where the political winds are shifting in Latin America. Right now their odds of Bolsonaro winning the Brazilian presidential election sit at 85%.
Brazilian equities ripped after Flávio Bolsonaro’s first round lead (still going to a run off October 25th). If you want to trade or dabble in the market that 25th date could add fuel to some of the runners that have already broken out on hopes he wins.
Exchange operator B3 surged 22.6% this week
Investment bank BTG Pactual gained 22.5%
XP’s Brazilian listed depositary receipts jumped 24.4%
Petrobras’ U.S.-listed shares also rallied 11.5% Monday
The TLDR here in Brazil at least is investors are betting on betting on fiscal tightening, lower interest rates and more capital market activity.
Could be some solid plays to be had down south but the region is not without curveballs right now.
Venezuela’s Cardón refinery, the country’s second largest with about 310,000 barrels per day of installed capacity halted operations after a fire on October 6.
PDVSA attributed the incident to a ruptured natural gas line feeding its boilers and said the blaze was controlled without injuries or major damage
Valero (VLO), Marathon Petroleum (MPC) and Phillips 66 (PSX) are names to watch.
Crypto
Crypto was looking super solid last night until long liquidations started coming in. In the past 24 hours $500+ longs have been wiped from the market. Bitcoin sits around the $83,600 range while Ethereum has dumped down to $2,575 area.
Alts are holding up okay all things considered but I am curious what this dump might be signaling to us (and equities might help confirm it when they open today).
In my mind right now there are two options: market manipulation and/or fuckery OR crypto is front running a larger global dump in response to this plague story.
If it’s manipulation of markets (some folks on X were talking about some odd timing in relation to US government transfers to Coinbase - see the Arkham news bullet below) than I would expect this to be one of our last pullback before we go higher.
In the latter scenario you would expect equities and other assets to follow suit later this week, some good ole fashioned Covid panic selling into the weekend.
Regardless it will be a dip I buy if it continues past Thursday EOD.
Crypto exchange OKX has raised new funding at a $25 billion (The Block)
Tom Lee says BitMine will stop buying more ETH when it accumulates 5% of the total Ethereum supply (WatcherGuru)
Russia has approved its largest bank, Sberbank, to offer crypto custody services
Robinhood this week announced it added $25,000,000 worth of Bitcoin to its balance sheet (WatcherGuru)
US government wallets just moved over $103M in crypto in nine hours, shipping 833 BTC and 40,285 BNB to unlabeled addresses, per Arkham (CoinTelegraph)
NEAR looks particularly solid on this pullback as does AAVE which is still up 7%+ on the week. If we were to get any larger dump for alt coins I would likely look to add these two plus some more Solana and Chainlink.
Bottom line here is we got a nice pullback in crypto with a nice mix of macro FUD and fear as well. If you are bullish in Q4 and 2027 now is the time to strike and get your positions squared away.
Don’t be a little softo and wait for the all clear — by then it will be far too late.
Dips are for buying right now in my humble opinion.
Global News Intel & Updates
Riots in France that authorities tried to attribute to “students” days ago have escalated into full blown unrest and rioting.
Reuters and other outlets are reporting that more than 500 schools have closed, while Prime Minister Sébastien Lecornu has acknowledged students’ grievances and condemned the ongoing violence. The government has now suspended the use of stun grenades at protests after a 15-year-old lost his hand during clashes in Lens.
Former German Bundesnachrichtendienst (BND) chief, August Hanning, who served as the head of Germany’s foreign intelligence service from 1998-2005, was arrested this morning on suspicion of treason
Anduril and the U.S. Navy announced a $6,600,000,000.00 investment to dramatically expand submarine parts production (Polymarket)
Counter Terror Police arrested a 22-year-old British man on suspicion of preparing terrorist acts over the RAF Fairford plot (PoliticsUK)
The New York Post has reported that the US military has lost 81 planes, drones and helicopters worth over $3,000,000,000 in the Iran war
Iran regime has rejected the U.S. nuclear proposal, vows continued uranium enrichment (InsiderWire)
Tropical Storm Isaias is forming in the Gulf and is expected to make landfall as a hurricane along the southern U.S. coast (BNO News)
The US is having its worst year for measles in 35 years per the CDC (Unusual Whales)
Russian Plague Situation Update
Since our guide I put out on Monday on Soviet and Russian Bio Weapon programs the plague lab leak and scare has surprisingly remained in headlines.
I noted on Sunday night that if this was still being discussed by Wednesday (today) than I thought there was a good chance this wasn’t simply going to fall out of discussion like Monkeypox and past scares.
What remains notable and unnerving about this event is the purported response it got inside Russia and the new developments emerging:
FSB escorting those that may have been contaminated or exposed
Hospitals in Irkutsk locking down
The WHO and other agencies noticing
The State Department and White House acknowledging it
Russia being vague and denying it
Reports of a second death
There’s conflicting information everywhere. Marco Rubio said earlier this week that the U.S. is “watching and monitoring” the suspected outbreak closely. The US Embassy in Moscow told Americans to leave Russia immediately due to an outbreak of pneumonic plague:
U.S. Embassy: The U.S. Embassy is aware of press reports from the Irkutsk region of suspected pneumonic plague resulting in the death of an individual and of associated quarantine measures in, and closures of, hospitals in Irkutsk. We continue to track the situation closely. The U.S. government has limited ability to help U.S. citizens in Russia, especially outside of Moscow. U.S. government personnel may face additional restrictions for personal and official travel to specific regions due to health and security concerns.
The State Department’s Level 4 Travel Advisory (Do Not Travel) for Russia remains in place and states U.S. citizens currently in Russia should depart immediately. U.S. citizens planning travel to Russia are again strongly advised not to travel to Russia due to risk of wrongful detention and security concerns.
The CDC came out yesterday as well saying:
At this time, there is no indication of a broader threat to the United States, but CDC and our interagency partners are prepared and will continue to monitor the situation closely.
Not that that means much if look back to the lies and bullshit during Covid, but it is certainly interesting agencies are choosing to speak to the Plague this early into the story.
The junior epidemiologist crowd has calmed a bit on X but I think it is worth emphasizing a key point.
If this is the plague or some other virus/agent etc., there is a serious possibility it has been weaponized or altered given the Irkutsk facilities history.
I detailed the Soviet era Bio Weapon Research capability and history Monday, making mention of Ken Alibek, the microbiologist and First Deputy Director of Biopreparat (the Soviet bioweapon program).
He oversaw the industrial-scale production and weaponization of deadly pathogens, including anthrax, smallpox, plague, and tularemia.
Below you can find an excerpt from his book Biohazard (which you can read in full here). You will notice that Irkutsk is labeled as a biological weapon research facility according to him. In his book he says MANY times that altering the Plague and other agents/weapons was a key component of Soviet strategy.
Plague could be prepared on a similar schedule. The plague weapon we had created in our laboratories was more virulent than the bubonic plague, which killed one quarter of the population of Europe in the Middle Ages. Smallpox was stockpiled in underground bunkers at our military plants, and we were developing a weapon prototype based on a rare filovirus called Marburg, a cousin of Ebola.
As of Tuesday there have been reports that Mongolia, Kazakhstan, Uzbekistan and Kyrgyzstan have all enacted measures to lock down their borders.
Now that I have had some time to mull over what we know I would offer up an alternative theory to what is going on and that is some sort of psy op or false flag event in which public perception of Russia is being manipulated. Can’t rule it out.
The war between Ukraine and Russia is accelerating daily, with more and more strikes deep inside Russia with drones by the Ukrainians occurring weekly (some of you may have seen the insane video of a Russian soldier shooting a MANPADS rocket at a Ukrainian drone over a highway in Moscow).
For months now Europe has been crying out that Russia is poised to strike neighboring countries and France, Belgium, and other countries are seeing a massive rise in domestic unrest amid tense political races.
The European establishment is hyper focused on Russia. Could it be possible this is an elaborate operation to further demonize and isolate Russia? In my opinon anything is possible after Nordstream, RussiaGate, Covid 19, and other major events over the last 5 years.
We just went through all of this with Covid 19 which we now know was in all likelihood a gain of function bioweapon released in China and funded by US taxpayers.
Tedros Adhanom Ghebreyesus, Director General of the ever reliable World Health Organization said on X last night that:
In response to WHO’s verification request under the International Health Regulations, the Russian health authorities reported that no case of plague had recently been registered in Irkutsk oblast. They informed WHO that an epidemiological investigation had been conducted, preventive and control measures implemented, and identified contacts placed under medical observation and tested. They reported that no high-threat pathogens had been detected among the contacts and that medical observation of all identified contacts had been completed.
Now I don’t think any of us completely buy that answer from Russia, but who knows.
This situation absolutely merits us paying close attention in the coming days given the proximity to Midterm elections AND the unrest spreading across Europe.
It kind of feels like psy op season and as if something big is on the horizon in my opinion.
Some of you have DMd me asking for a new prepper post, which I am happy to do tomorrow or next week for paid subs if you would like. I can include photos of my kit and what I carry everyday in my car, stashed in my house, etc. Could be good as a general reminder as we enter Fall/Winter.
Let me know in the comments if you would like it, could be a cool departure for markets for one edition.
Anyways, godspeed this week. If you want to follow along with hourly updates hop on our Discord or follow me on X HERE.
Andy
Yes please new prepper post and please reference dates for prior info so we can look back!
+1 pepper post please