Just don't call it QE
Ah, the US financial engineering is back in action, perhaps its warranted to call it QE Lite! So, let's discuss just what types of financial engineering the US is currently utilizing as a National Power.
Stimulating the economy thru direct investment in US Firms
Some have speculated this is fueling the rise technofeudalism fears in the USA. The US has a invested $27Billion for investment into 37 deals.
Here are some examples
- Intel for a 9.9% investment
- MP Materials for a 15% investment
- Lithium Americas for a 5% investment
You realize this creates state influence without state control, right?!?
Buying Long end (10/30-year) bonds
US Treasury Sec Bessent on 08/19/26 performed an unexpected doubling (from $2B to $4B per operation) of US purchases of the long end bonds to drive down yield 2031-2034 dated. This is due to start Sept. 9th 2026. The last time this took place was in the Clinton presidency. The difference the US had a budget surplus. Now we are at $40 Trillion (yes I rounded up, but I didn't have that far to go.) I do not see this technique working for very long as nation states can get together and force market direction movement. Think back to the Bank of England (BoE) in the 1980's... Hey wait a minute didn't Bessent work with Soros to take down the BoE using a similar mechanism?
Additionally, today's action put major pressure on the US dollar ($), which is now down almost 3% in recent days.
This does help put pressure on other FIAT currencies. While propping up $ demand globally.
The pressure on the Straight of Hormuz might be about using it as a commodity choke point.
This 'pressure' will directly impact Iran of course, but also directly China. Recall China imports over 12% of their oil from Iran. Detailed out in a more meaningful manner over 80% of Iranian exported oil went to China!
Oil/petroleum is utilized to create all different types of end products for export
Summary
I detailed out three (3) separate and powerful financial engineering tools already in motion. I am almost certain that there are lesser known yet equally powerful tools in use. By reviewing today's equity market impact and the US National debt passing the $40Trillion mark at the time of this writing, I look for more financial engineering to come. Stay frosty my friends.
Credits - BLOG image - https://corporatefinanceinstitute.com/ = ALL RIGHTS REMAIN!
Disclaimer - I don't live in nor do I have a desire to visit any of the sanctioned nation states listed. No need to come knocking on my door, thanks!
