We Begin The Runup To The Midterms

The news is about what you'd expect, and likely to become even more so. First the Good News—according to Trump/Bessent: Uh-huh! I'm sure you've seen the catch to that. It's what the generals apparently told Trump in their dissent from Hegseth's views:Iran gets a vote. And Iran's vote will ensure that none of the above is gonna happen—certainly not before November. Here's Iran's vote, as manifested over the past 24 hours—which comes after Iran announced the expansion of their area of control well out from Hormuz into the Gulf of Oman: The Hormuz Letter @HormuzLetter 18h BREAKING:Iran launches multiple waves of anti-ship cruise missiles and Shahed-136 drones from Sirik, southern Iran, toward vessels under US Navy escortin the US-backed southern Omani corridor of the Strait of Hormuz, per initial reports. The target is a large convoy of US-escorted oil tankers currently transiting the Omani route. Multiple explosions heard minutes ago. 17h BREAKING:The Trump administration has sent a new peace proposal to Iran through mediators,per a senior source in Tehran to RT. US stock market futures open in less than an hour. Good luck with that, if it was even intended seriously—because Iran definitely didn't take it that way. 17h BREAKING:Iran rejects the proposal, saying Iran sets the conditionsof any proposal and the US 'repeated violations' and shifting positions make talks currently impossible, per a senior source in Tehran to RT. Iran says all conditions must be met first, which remain unchanged: $300 billion in US compensation, complete lifting of all US sanctions, release of $100 billion in frozen Iranian assets, end of the US naval blockade, US troop withdrawal from the entire region, and a comprehensive regional ceasefire including in Lebanon and Gaza. DD Geopolitics @DD_Geopolitics 2h Iranian air defenses have shot down an American MQ-1C Gray Eagle reconnaissance and strike drone operating near the Strait of Hormuz. Iranian sources say the aircraft was destroyed before they could pose a threat to Iranian territory. The MQ-1C is one of the U.S. Army's most sophisticated armed surveillance drones, capable of carrying Hellfire missiles and advanced ISR equipment. Recent Army procurement figures work out to roughly $35 million per system. That's the second one in the last 24 hours, I believe. And this next is sure to fascinate Russian and Chinese engineers. According to Brave AI re the Pentagon's Replicator Initiative, all this was originally dreamed up for use against China: DD Geopolitics @DD_Geopolitics 23m IRGC seizes advanced U.S. underwater drone Iranian sources report that the IRGC Navy has seized anAnduril Dive-LDautonomous underwater vehicle in the Strait of Hormuz. The 5.8-meter U.S.-made underwater drone can operate autonomously for up to 10 days and dive to depths of 6,000 meters.Its modular payload system allows it to perform ISR, undersea reconnaissance, mine warfare and seabed-mapping missions. The Dive-LD was selected for thePentagon's Replicator initiative, and the first system was delivered to the U.S. Navy's Unmanned Undersea Vehicle Squadron One (UUVRON-1) in 2025. And that's what happens when you think you can get away with the art of the double-cross on the world stage—nobody cuts you any slack. In line with what we've been insisting—escalation is what Iran wants—Iran has Trump where they want him. If Trump tries to escalate, Iran trumps his escalation with their own. If Trump tries to back off, Iran trumps him by forcing him back onto that escalation ladder. Add to that Iran's/Yemen's closure of the Bab el Mandeb strait, and now the disastrous war between KSA and Yemen—with Yemen continuing to hit Saudi/American oil infrastructure—and it's clear to anyone with eyes to see that Trump is simply not in control. He and his minders were stiffed in Moscow and now Xi will be visiting the Imperial City in Decline on the Potomac on September 24th. I can't imagine what their conversations will be like, but Trump better not be expecting any concessions. China is back to buying up vast amounts of whatever oil is available. Luke Gromen offers this caution to fantasists who think the USN is somehow going to cut China's oil supplies: Luke Gromen @LukeGromen 15h In keeping w/trying to speak more plainly on X: US cannot cut off China's oil while the world is sending China $1.2T a yr in trade surplus, because China can use it to outbid others for oil…& when China does, the resultant rise in oil sends UST yields to problematic levels Yeah. Oil is rising sharply and Japan dumped $88T in treasuries in August. That's not what Bessent wanted. There's also this: Kathleen Tyson @Kathleen_Tyson_ Sep 6 Hedge funds are forced buyers of USTs as a result of mandatory margin on OTC derivatives. A margin call due to UST mark downs forces them to buy more, not divest.This is the pattern of the past 3 years. Mandatory margin was designed after GFC to create more trapped forced buyers.It's working as planned. Luke Gromen @LukeGromen 1h Implication of this headline for investors, in plain speak: Inflation is going WAY higher over time if this continues; sell LT bonds on all days ending in '-y'. And now for a large dose of reality. Trump thinks the winning campaign strategy for the GOP, heading into the midterms, is to make the election a referendum on his surpassing greatness: The Kobeissi Letter @KobeissiLetter 1h BREAKING:US diesel is now closing in on a $6/gallon national average, for the first time in history, with wholesale prices surging 13 cents/gallon tonight. California could surge past $8/gallon statewide in the coming days, with San Francisco's average hitting an all-time high of $8.23 already.The state average is more than $2.60 higher than a year ago today.Some California pumpsare not even built to display what could come next, as theytop out at $9.99. This comes as Iran has rejects the latest US peace proposal and the US and Iran exchange strikes in the Strait of Hormuz. This is especially problematic as the US has officially entered its peak diesel demand period. Inflation expectations continue to mount as a result. 2h BREAKING:Brent crude oil prices rise above $99/barrelfor the first time since July 24th as the US and Iran exchange strikes. Inflation expectations are rising sharply. 10h BREAKING:Canada has officially imposed new tariffs of up to 50%on hundreds of products from the US in response to President Trump's tariffs. New tariffs include US steel, at 50%, and a range of consumer goods, motorcycles, cosmetics, cheese, and more. Are you tired of winning, yet? Thanks for reading Meaning In History! Subscribe for free to receive new posts and support my work.