{"id":31586,"date":"2026-10-06T04:00:00","date_gmt":"2026-10-06T02:00:00","guid":{"rendered":"https:\/\/www.thebrokernews.ch\/?p=31586"},"modified":"2026-10-05T16:04:53","modified_gmt":"2026-10-05T14:04:53","slug":"how-the-tide-turns-column-by-eric-lefebvre","status":"publish","type":"post","link":"https:\/\/www.thebrokernews.ch\/en\/how-the-tide-turns-column-by-eric-lefebvre\/","title":{"rendered":"As the Barrel Turns"},"content":{"rendered":"
For a change, Eric Lefebvre wanted to write something cheerful today.<\/span><\/div>\n\n\n\n

A confession: your columnist sat down this week fully intending, for once, to write something cheerful. Then he turned on the show. Oil fainting and reviving on every presidential bulletin, while the crude sneaks back and the diesel does not. <\/strong><\/p>\n\n\n\n

A trillion-dollar love triangle in which the same dollar keeps proposing to three different companies; a treasury bailing the Atlantic with a teaspoon; France playing a bankrupt in a borrowed tuxedo, and now borrowing dearer than Italy; and a stock market at record highs beside a public in its second-worst mood on record, pausing only to go to church and pray the Federal Reserve will not raise the collection. If everything must collapse at once, it may at least do so entertainingly.<\/p>\n\n\n\n

It is tiring, and a little too easy, to be the bearer of bad news every week. Any fool can stand at the roadside and tut at the traffic. So I sat down on Friday fully resolved to write you a cheerful column, a sunny thousand words on the resilience of the human enterprise, and I lasted about four minutes, which is roughly the length of the opening titles. Because the trouble with the markets in the autumn of 2026 is not, in the end, that they are grim. It is that they have become a daytime serial. An absurd, overwrought, gloriously watchable soap opera, in which nothing is ever resolved, the same cliffhanger airs every Friday, and the cast delivers each preposterous line with a perfectly straight face. So this week, in the spirit of fun, let us do away with the sermon and simply review the latest episodes. Pour yourself a coffee. Previously, on As the Barrel Turns.<\/p>\n\n\n\n

Previously, on ‘As the Barrel Turns’<\/h6>\n\n\n\n

Our leading lady, as ever, is the price of oil, and she has had a wonderful month, by which I mean a ruinous one for anyone who actually has to buy her. Her entire character arc this season consists of fainting and then reviving, and the thing that makes her faint or revive is not supply, not demand, not a single tanker anywhere on the actual sea, but the latest bulletin from the show’s incorrigible showrunner in Washington. He lets it be known he is open to talking to Iran, and she swoons below a hundred dollars. He announces, a few days later, that on reflection he rejects the truce and is mulling strikes, and she revives, the colour rushing back to her cheeks. He denies that he will ease the sanctions, and she rallies again. He pronounces himself hopeful, and down she goes once more, reaching for the chaise longue. The audience gasps on cue at every turn, though the audience has followed this programme for months and knows perfectly well that she always survives to the next episode.<\/p>\n\n\n\n

This week’s episode was a classic of the form. A third American aircraft carrier, and something like ten thousand more troops, were reported on their way to the Gulf. Three tankers were struck in the strait. The showrunner, asked what came next, offered the sort of line a writer puts in a villain’s mouth and then thinks better of: they will sign a very fair deal, or they will not exist any longer. Brent, which had spent the middle of the week fainting back toward the high nineties, sat up, recovered her colour, and finished the week a little above a hundred and two. The day traders were carried out on stretchers between scenes, as usual. The plot, underneath, had not moved an inch.<\/p>\n\n\n\n

And here is the joke the closing credits never show you. For all the fainting, the barrel finished September sharply dearer than it began it. The swoons are real enough to the men who trade the day. To the actual plot they are nothing. What has changed, and what a correspondent with a shipping note will quite rightly write to tell me, is that the crude is no longer the thing that is missing. By one serious count, oil through the strait is back near thirteen million barrels a day, something like its old flow. The refined product is not. China has halted fuel exports for October, a week after Washington asked Xi for more. Diesel, in Europe and beyond, is the shortage that will not take direction. It is magnificent theatre laid over a duller and more inconvenient fact than a closed strait: the crude is sneaking back, the diesel is not, and the showrunner has started asking other people’s cupboards to make up the difference. That, as it happens, is the house style of the entire production.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n
The love triangle nobody wants explained<\/h6>\n\n\n\n

Every good serial needs a romance, and ours is a scandal. The three glamorous leads are Nvidia, OpenAI and Oracle, and they are passionately, recursively, almost unnervingly in love with one another. Nvidia takes an equity stake in OpenAI. OpenAI, thus funded, promises a fortune to Oracle for computing power. Oracle, thus enriched, spends it buying Nvidia’s chips. Round and round the same dollar goes, declaring its undying love at three separate front doors, and the market applauds each fresh engagement as though it were new money arriving to the party, rather than the old money simply running laps of the garden.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

It is a beautiful arrangement, provided nobody in the audience asks the vulgar question of where the money actually lives, and so, out of good manners, nobody does. Were one to ask, one might open Nvidia’s own accounts and find, tucked in the footnotes, that seventy per cent of what it is owed comes from just five customers. One might notice that roughly half of Oracle’s enormous backlog of promised future revenue rests on a single company, OpenAI, which contrived to lose something like twelve billion dollars in a quarter against six and a half billion of sales, and whose credit, at Oracle, now sits a single notch above junk. One might even recall a certain famous short-seller’s cheerful observation that if this one unprofitable, unlisted darling were ever to stumble, the whole United States would be in recession by the following morning, because the entire chain, from the chipmaker to the clouds, is leaning its full weight upon her. But one does not ask. It is a love story, and love stories do not survive an audit.<\/p>\n\n\n\n

There is a further twist, and it is my favourite, because it is the villain’s monologue delivered as a public service. The suitors, you see, have no moat. Today the world swoons for ChatGPT, tomorrow for Gemini, the day after for Claude; they rotate like beaux at a ball, and now a troupe of handsome, very nearly free Chinese models has arrived uninvited and is dancing with everybody’s partner. So what does a nervous incumbent do, upon realising that his charms are not, after all, unique and eternal? He rises, grave and statesmanlike, and announces that his product has become so terribly dangerous that the industry really ought, for the good of mankind, to be slowed down and, with the deepest reluctance, regulated. It is a magnificent performance, and it would move me to tears were it not for the one small giveaway: the man warning the world that his creation may shortly end civilisation has not, somehow, postponed his initial public offering. A gentleman who genuinely fears the monster in his basement does not, as a rule, schedule a party to sell tickets to the viewing.<\/p>\n\n\n\n

An emerging market in a very good suit<\/h6>\n\n\n\n

Beneath all the glamour runs the show’s real, slow-burning plot, the one the writers rather hope you will not notice, because it has no explosions in it at all. The richest economy on earth is quietly acquiring the manners of a poor one. Nothing dramatic happens, and that is exactly the point: it does not crash, it sags, which is the least cinematic catastrophe ever devised, and therefore the only one that can run for years without a single viewer reaching for the remote.<\/p>\n\n\n\n

If you want the one frame that gives the whole game away, it is a stock market at its all-time record high, the S&P closing the week near 7,720, and a public in its second-worst mood since the survey began in 1952, at precisely the same moment. September’s reading was 48.1. Only May, in the whole of that history, was darker. In a healthy and confident country those two lines do not cross like that; they travel together, because people feel rich when the market feels rich. When they diverge this violently, the index measuring one thing and the citizen plainly feeling quite another, you are looking at the defining portrait of a two-speed society: splendid if you happen to own the assets, bleak if you merely live in the country that houses them. It is the most emerging-market picture a developed nation can paint, and we now paint it fresh every month.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

The quiet star of this particular plot, the character who keeps winning scenes without being given any lines, is gold, a little above four thousand one hundred and sixty dollars an ounce, which has spent years discreetly beating the celebrated stock market once you measure that market in ounces rather than in the currency being gently debased beneath it. And there is precisely one cheerful subplot, which I include so that you can never say I bring you nothing but bad news. The saver, ignored and insulted for a decade, is at last being paid, with cash and short bonds yielding comfortably over four per cent. After years of being told that thrift was a hobby for the timid, the prudent are quietly getting a raise. Enjoy it. It is the only happy marriage left on the show.<\/p>\n\n\n\n

The teaspoon, since the opening titles promised it, can be dealt with in a sentence, because the arithmetic is the joke and the joke does not improve by being explained. On Wednesday the Treasury sold seventy billion dollars of five-year notes. On Thursday it bought back four billion of the long end. A few billion out, seventy billion in, against a market of more than thirty trillion that must swallow trillions of fresh borrowing every year. That is not a bazooka, and it is not even a bucket. It is a teaspoon, and the thing being bailed is the American deficit, which no teaspoon reaches.<\/p>\n\n\n\n

France, the dowager, and the amateurs’ winter<\/h6>\n\n\n\n

No serial of any ambition is complete without the grand old aristocrat who flatly refuses to admit that she is broke, and ours, inevitably, is France. The character is superbly drawn: the impeccable tailoring, the firm opinions on cheese and on taste, the century spent gazing down the long table at the vulgar nouveaux riches. And this season she is in real trouble, and the trouble is no longer a character note. It is this month’s plot. Her government cannot pass a budget; the draft now going to parliament asks for fifty-four billion euros of cuts, and she has no majority with which to pass them; she survives from one vote of no confidence to the next on procedural fumes, or on the constitutional trick that lets a prime minister govern without a vote and dare the chamber to throw him out. A ratings agency has docked her another grade. Her cost of borrowing relative to Germany has climbed through a hundred and twenty basis points, the widest in twelve years, a gap not seen since the euro itself was on the table. And here is the line that should end the argument about whether this is still a developed-market story. France now pays more to borrow than Italy. A founding nation of the developed world, a nuclear power with a permanent seat at the very top table, borrowing dearer than the country it spent a decade lecturing on fiscal manners.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

And this is where an old and familiar face strolls back onto the set, because no European debt drama is ever quite complete without it. The great Wall Street houses, Goldman Sachs prominent among them, alongside Deutsche Bank, are now busily packaging France’s distress into something a client can trade, turning the coming election and the widening spread into a tidy little product with which to bet against the Republic. It is worth pausing on the loveliness of the circle. This is, broadly, the same marque whose name is forever attached to the swaps that once helped a certain Mediterranean government flatter its books in the years before it blew up and took the whole euro to the brink. The house that helps dress the patient for the ball in one decade is, it turns out, delighted to sell you the wager against his recovery in the next. It will cheerfully work both sides of the trade, across the generations, with the same immaculate manners throughout. If you have ever wondered who reliably does well out of a European crisis, the answer has not changed since 2012, and it is not, I am sorry to report, a European government.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Which brings us, at last, to the supporting cast, the broader European leadership, who are managing the whole affair with the unmistakable air of a troupe of comic-strip bunglers on holiday, les Pieds Nickel\u00e9s en vacances, as the French so perfectly have it, forever unveiling a cunning plan whose one dependable victim turns out to be themselves. Their masterstroke of the season was to march into a winter they already cannot heat, with gas in store at a two-decade low, while nobly cutting off yet more of the very energy they will shortly be begging for, and then to profess astonishment, each and every year, that January is cold. This week the farce acquired a director. Washington has told Germany and France to draw something like a hundred and twenty million barrels of diesel out of emergency store over the next six months, or face the possibility of an American ban on diesel exports. The protector, in other words, has ordered the ward to burn the emergency tank, and is prepared to scold her for not having done it already. One can only admire the consistency. It takes a rare and special class of amateur to stage a whole continent’s energy policy as a farce, to hold the sanctions microphone in one hand and the empty fuel gauge in the other, and still contrive to look, from the podium, like a statesman, while the ally who sold them the fuel now asks for it back. The season ahead will be a long one in Europe, and I suspect, for the true connoisseur of the genre, a richly entertaining one.<\/p>\n\n\n\n

The mansion full of businesses nobody can sell<\/h6>\n\n\n\n

And then there is the character who is seldom on screen but whose storyline is about to turn, and that is private equity, the smooth financier who spent the long era of free money on a shopping spree of heroic proportions. He borrowed vast sums at almost nothing and bought up hundreds of perfectly ordinary businesses, the call centres and the back offices, the software resellers and the claims processors, the dull and dependable cash machines of the real economy, and he piled fresh debt onto each of them, because debt was free and surely the music would never stop. Two things have since happened to him, and both are very bad, and both, if you are not him, are quite funny. First, the money is no longer free: all that debt has to be refinanced now at five per cent and more, and a company bought precisely in order to be squeezed does not take kindly to having its own interest bill tripled. Second, and far more poetically, a great many of those dull dependable firms do exactly the sort of routine white-collar work that a cheap artificial-intelligence model now performs in seconds for a fraction of the wage. He bought, in short, at the very top of the market, with other people’s borrowed money, an entire portfolio of precisely the companies the new technology was built to hollow out. The wrecking ball he was so thrilled to invest in is swinging, with a certain poetic justice, straight toward his own mansion. There is a word for the sophisticated gentleman who borrows to the hilt to buy the one asset a disruptive technology is about to render cheap, and the word, I am afraid, is not genius.<\/p>\n\n\n\n

The season finale that never airs<\/h6>\n\n\n\n

The true genius of this show, the reason it can run quite literally forever, is that it is structurally incapable of ending, because an ending would require somebody in the cast to switch off the cheap-money life support, and not one of them is willing to be the character who does it. Consider the proof offered by this very week, which was, in its way, a church service.<\/p>\n\n\n\n

On Wednesday the congregation was handed the Federal Reserve’s own inflation measure, not the consumer price index, which does not arrive until the 14th. Prices had risen three and a half per cent on the year, a little cooler than the three and seven they had braced for, and still a point and a half above the target their bishop keeps naming from the pulpit. They received it as an answered prayer. The odds of another rise in October, something like seventy per cent on Monday, were nearer forty by the close. Then on Friday a genuinely weak jobs report arrived, twenty-nine thousand against ninety thousand expected, the prior months cut, July revised to a loss, and they sang a second hymn, because weakness, in this parish, means the collection might be postponed. By the bell the odds of an October rise were about a quarter. The stock market took communion and made a record. The bond market, the one grown-up left in the nave, dipped toward five and a fifth, thought about it, and went back to selling, finishing the week no kinder than it had started the morning.<\/p>\n\n\n\n

Going to church to pray the cost of money down, while the long end sits at a twenty-year high and inflation has not been at two per cent in half a decade, is funny. It is also sad, and it is how a soap trains you not to notice that the next service is already on the board. Kevin Warsh raised in September, the first rise in three years, to a range of three and three-quarters to four, and told them another was likely this year. The congregation has decided, on one cooler-than-feared print and one soft payroll, that October is off. The consumer price index arrives on the 14th, one decimal place, same pews. The rate decision is on the 27th and 28th, days before a midterm election on the 3rd. France’s budget is on the floor all month. The mood survey prints again on the 9th. Good news is good. Bad news, it turns out, is also good. A number that is merely less bad than feared is, in this parish, a miracle. And nothing, by this arithmetic, is ever permitted to be the end.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

I promised you some fun, and I hope I have managed a little, because the alternative to laughing at all this is not a dignified sobriety. It is simply watching the same anxieties go round on a loop, and that is not analysis, it is a nervous tic. But allow me the single sober line the genre still permits, because this is, when all is said, Planet Finance. The real danger of a long-running soap is not the melodrama. It is that the melodrama slowly trains you to stop believing that anything will ever actually happen, so that you are still there, half-watching, faintly amused, mildly bored, on the particular afternoon it quietly stops being a soap opera and turns out to have been, all along, a documentary. So keep your wits about you, and keep a little of your money in the things the show cannot fake: the metal that needs no suitor, the cash that has at last begun to pay you, the honest small business that does something no model can. And do tune in next week. Same barrel, same time. Your columnist will again sit down meaning to be cheerful, and will again, he rather suspects, last about four minutes.<\/p>\n\n\n\n

Eric Lefebvre<\/p>\n\n\n\n

See also: Where It Breaks First<\/a><\/p>\n\n\n\n

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