Primary Trends

The value of US capital is in decline. Dear Readers are cautioned to stay in Maximum Safety mode a bit longer. There is at least a fair chance of a major sell-off in the stock market, coming soon.

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Thursday, May 14^th, 2026

Bill Bonner, from Buenos Aires, Argentina

The US-Israel war on Iran has acted not as a mere diversion but as a brutal accelerator of history, fundamentally rupturing the Middle East’s security architecture and accelerating the very realignment it sought to prevent.

--Bob Savic

News flash: the yield on long-term US treasury bonds is now over 5% — the highest in 19 years.

This is the Primary Trend in motion. Yields are going up; the real value of dollar denominated debt is going down.

It means broadly that the value of US capital is in decline. Dear Readers are cautioned to stay in Maximum Safety mode a bit longer. There is at least a fair chance of a major sell-off in the stock market, coming soon.

This is in line, too, with the political and historical picture. We believe, like Mr. Savic above, that the role of Trump’s war against Iran is not to reverse America’s decline...but to speed it up, further undermining US dollar asset values.

The Iranian adventure looks more and more like a real Operation Epic Fubar. While it is too early to pronounce either victory or defeat, none of Trump’s strategic goals has been accomplished. And if he is allowed to continue for another two and a half years, the ‘brutal accelerator’ of history will presumably continue dragging the US economy, its assets, and its global power -- like a grandmother in the teeth of an alligator -- into the swamp.

But can POTUS last for another two and a half years? Our question for today: Which will give out first: asset prices...or Trump himself?

Republicans must be asking themselves the same question...and wondering if they want to wait to find out. At some point, the Big Man may turn into more of a liability than an asset....especially if stocks are going down and interest rates are going up.

POTUS faced reporters this week....and went amok. The reporters asked their usual softball questions. But instead of giving them the mushy blah blah they asked for, Trump seemed to open his soul. It was not a pretty sight. Rather than defend his policies, POTUS attacked reporters for asking questions:

‘Let these lunatics have a nuclear weapon. If you want to do that, then you’re a stupid person, and you happen to be.’

The ‘lunatics’ in question may have just humbled the world’s leading military power. And the ‘stupid person’ was just asking a very un-stupid question: How could Trump square his war with Iran with his promise to bring down the cost of living?

The appearance of a loose wire in the presidential noggin was further suggested this week by Trump’s declaration that he was ‘seriously considering’ making Venezuela the 51st state. Most listeners simply tuned out; it sounded like just another one of the president’s throwaway fantasies, like making Canada the 51st state.

At least, they speak English in Canada...and share similar institutions. But Venezuela?

And then...a more stable genius would close his laptop at the end of the business day. Not Trump.

The Wall Street Journal set up a database to keep track of more than 33,000 posts on Truth Social by DJT. This must be why the president is so ignorant of so many things and makes so many ‘mistakes’ — he has no time to think.

On Monday night, for example, when he might have been reading up on Persian history or making a serious inquiry into immigration policies...POTUS posted more than 55 times in three hours.

About what? The usual gripes, lies, and confusions. At 10:15 PM, he said Obama was a ‘traitor’ and should be arrested. At 10:24 he posted a fake account that claimed Obama had wiretapped Trump Tower. By 10:29 he was attacking the vote counting in Georgia. A minute later he wanted to arrest Jack Smith. And then by 10:47, he called Obama the ‘most Demonic Force’ in American politics.

On and on it went until after 1 AM, when he took aim at the New York Times for reporting on the 600% cost over-runs on the Capitol reflecting pool.

A sizzling pace for a 79-year-old. His body may be able to keep it up. Can his brain?

We don’t know. But between Primary Trends — Trump’s lifecycle on one hand, and the down-cycle in asset prices on the other — we’ll see which one bottoms out first.

Regards,

Bill Bonner