Everything Just Got More Dangerous

If you missed anything this week, things were all over the map: inflation, AI, Blackstone, Japanese life insurers, the national debt, defense spending and, finally, a trade I think could get very interesting if this market decides to shit the bed.

This week I pointed out one “dark horse” way to potentially get short exposure to the market in an area most people wouldn’t look first.

A Dark Horse Way To Short The Market

And hundreds of billions are being invested assuming frontier AI development continues unabated. Meaningful restrictions could suddenly force the market to reconsider the gigantic assumptions embedded throughout the AI complex, which I wrote about:

Congress Could Kill AI Stocks Before AI Kills Us

🔥 90% OFF EXTENDED FOR TODAY: I am again offering an 90% discount to anyone that wants to become an annual subscriber today. It’s a discount you can keep and stays applied for as long as you wish to remain a subscriber: Get 90% off forever

Meanwhile, Blackstone’s real-estate chief is leaving just as the business is supposedly heading toward greener pastures. Maybe it means nothing. But executives generally don’t walk away from enormous compensation when they think the next few years will be spectacular. I looked at why the timing caught my attention with BREIT, commercial real estate, higher rates, illiquidity and private credit still lurking beneath the surface:

The Incentive To Stay, The Psychology Of Leaving

And a departing Anthropic researcher warned about increasingly capable AI eventually becoming capable of improving itself faster than humans can meaningfully supervise it. My point wasn’t that Skynet arrives Tuesday afternoon. It’s that there may be a point after which our ability to put the genie back in the bottle disappears, and waiting until everybody agrees AI is dangerous could mean waiting too long. I wrote my thoughts here:

We May Only Get One Chance To Stop AI

Japanese life insurers are sitting on nearly $200 billion in unrealized bond losses. That isn’t necessarily fatal until somebody needs liquidity and paper losses become real ones…the basic mechanism that helped destroy Silicon Valley Bank. I explained why Japan’s enormous footprint in global fixed income could make this much more than a Japanese problem:

Japan’s Life Insurers Look Like Silicon Valley Bank And 2008 AIG Combined

Finally, I’ve been bullish on defense and aerospace for years because I think the world is entering a prolonged period of higher military spending, inventory replenishment and strategic competition. New Pentagon developments offered another piece of evidence for that thesis…but in a different sector than most would expect:

The Pentagon Just Confirmed One Of My Biggest Investment Theses

Here’s some more of my latest idea-driven content:

And here’s what else is new on the blog:

If you missed a few, the weekend is as good a time as any to catch up. Thanks, as always, for reading, sharing and supporting my work.

—QTR

QTR’s Disclaimer: Please read my full legal disclaimer on my About page here. This post represents my opinions only. In addition, please understand I am an idiot and very often get things wrong and lose money. I may own or transact in any names mentioned in this piece at any time without warning, meaning if I’m long I could sell or if I’m short I could cover at any time.

Contributor posts, guest posts and curated posts have been hand selected by me, but have not been fact checked and are the opinions of their authors. They are either submitted to QTR by their author or reprinted under a Creative Commons license with my best effort to uphold what the license asks, or with the permission of the author.

I cannot guarantee the accuracy of any or all facts and figures included in this article though I made an effort to get them right. I have been wrong before and will be wrong again, and encourage you to always double check, do your own research and speak to a licensed financial professional, which I am not.

This is not a recommendation to buy or sell any stocks or securities, just my opinions. I often lose money on positions I trade/invest in. I may add any name mentioned in this article and sell any name mentioned in this piece at any time, without further warning. None of this is a solicitation to buy or sell securities. I may or may not own names I write about and are watching. Sometimes I’m bullish without owning things, sometimes I’m bearish and do own things I’m bearish on. Just assume my positions could be exactly the opposite of what you think they are just in case. If I’m long I could quickly be short and vice versa. I won’t update my positions.

Starting in 2026, I have been attempting to no longer actively trade as much as I once did (read my story here). My goal is for my investing/saving to be done by recurring contributions mostly to sector ETFs and a few select equities, trusted third parties who oversee my accounts, and advisors. Such advisors or funds, through individual equities, options, index funds, mutual funds, ETFs, or other securities, may have positions in, exposure to, or holdings of names mentioned herein that I know nothing about. It is possible I could own, have exposure to, or not own anything, at any point. In an attempt to lead a healthier lifestyle, I’ve also excluded myself from fantasy sports, sports betting, online and in-person casinos and prediction markets.

Any of my positions can change immediately as soon as I publish, with or without notice and at any point I can be long, short or neutral on any position. You are on your own. Do not make decisions based on my blog. I exist on the fringe. If you see numbers and calculations of any sort, assume they are wrong and double check them. I failed Algebra in 8th grade and topped off my high school math accolades by getting a D- in remedial Calculus my senior year, before becoming an English major in college so I could bullshit my way through things easier. Hence, why I am a writer.

The publisher does not guarantee the accuracy or completeness of the information provided in this page. These are not the opinions of any of my employers, partners, or associates. I did my best to be honest about my disclosures but can’t guarantee I am right; I write these posts after a couple beers sometimes. Many times I edit after my posts are published because I’m impatient and lazy, so if you see a typo, check back in a half hour.

Also, again I just straight up get shit wrong a lot. I mention it multiple times because it’s that important you understand.

Contributor posts published on Zero Hedge do not necessarily represent the views and opinions of Zero Hedge, and are not selected, edited or screened by Zero Hedge editors.