US, Iran Weigh Longer Truce as Pakistan Boosts Mediation Efforts

(…) The US and Iran are considering a two-week ceasefire extension, according to a person familiar with the matter, who asked not to be identified discussing sensitive matters. Neither side desires restarting fighting, said another person familiar with the discussions, with the war having devastated Iran’s infrastructure and sent energy prices soaring, including in the US. (…)

Iran has said it isn’t pursuing a weapons program. The country’s right to peaceful use of nuclear energy “cannot be revoked,” Foreign Ministry Spokesman Esmail Baghaei said Wednesday. However, the level and type of enrichment are “negotiable,” he added. (…)

• U.S. and Iran inch toward framework deal to end war, U.S. officials say

(…) A U.S. official said President Trump’s negotiating team — Vice President Vance, White House envoy Steve Witkoff and senior adviser Jared Kushner — continued making calls and exchanging draft proposals with the Iranians and mediators Tuesday.

• “They were on the phone and backchanneling with all the countries and they are getting closer,” the U.S. official said.
• A second U.S. official confirmed progress was made Tuesday.
• “We want to make a deal. And parts of their government want to make a deal. Now the trick is to get the whole of government over there to make the deal,” a third U.S. official said.
• Vance, who led the initial talks in Pakistan last week, said at a Turning Point USA event in Georgia Tuesday: “I think the people we’re sitting across from wanted to make a deal. … I feel very good about where we are.”
• “The details are complicated — you can’t do that in two days,” one U.S. official said.

Gulf states turn to private deals in $10bn wartime borrowing spree

Gulf monarchies have discreetly raised almost $10bn in private sales of bonds this month in their first international borrowing since the Iran war delivered a major hit to their economies.

Abu Dhabi has sold $4.5bn, Qatar $3bn and Kuwait $2bn in private placements of US dollar bonds since the start of April, sidestepping public markets where they typically issued debt before the war but where borrowing costs can be more uncertain. (…)

The Iran war is delivering a sizeable blow to their economies, with Qatar forced to suspend exports of liquefied natural gas and oil flows from Kuwait and the United Arab Emirates sharply reduced, hitting the bedrock of their economies.

“Even if the war ends soon, we expect all six Gulf states to record negative GDP growth this year of 5-10 per cent,” Capital Economics analysts said. (…)

Gulf state-owned banks have meanwhile raised hundreds of millions of dollars in recent weeks through private placements of bonds and other forms of short-term debt, sometimes through branches in Asia.

Iran’s Shadow Fleet Meets Its Match in U.S. Blockade A network of vessels has helped Iran evade sanctions but naval patrols pose a new challenge

(…) Early signs are that after years of dodging restrictions, the Iranian shadow fleet may have met its match in the U.S. naval blockade—its ships now appear unable to leave the Persian Gulf. (…)

On Wednesday, Centcom, which oversees U.S. forces in the region, said that no ships got through its blockade of Iranian ports in its first 48 hours. Nine vessels obeyed direction from U.S. forces to reverse course and re-enter an Iranian port on the Gulf of Oman, Centcom said.

At least 10 ships transited the strait on Tuesday, according to Lloyd’s, some with the hallmarks of shadow-fleet activity, shipping analysts say. (…)

Ships with ties to Iran have so far had a better time getting into the Persian Gulf than out, possibly pointing to the difficulty the U.S. Navy might have in determining where a vessel is heading before it arrives. (…)

Military and shipping analysts said the movements showed how operators of shadow ships were trying to test the limits of the blockade and probing to see whether the U.S. would take action to enforce the closure.

“I think that they’re trying to push the envelope to see. Is the U.S. going to really go the whole measure here,” said Bryan Clark, a former senior official with the U.S. Navy and now a senior fellow with the Hudson Institute. (…)

“How many ships are going to test the blockade? Does the Navy have enough ships, aircraft, assets, et cetera to keep up with that?” said Wills.

Windward (my emphasis):

[On April 14] A total of 19 vessels transited the Strait, including 5 inbound and 14 outbound crossings. Outbound traffic included two tankers flagged to Malawi and the Netherlands, one Panama-flagged bulk carrier, and eleven cargo vessels, including five Iran-flagged, four Comoros-flagged, one India-flagged, and one Oman-flagged vessel. (…)

On 15 April 2026, 15 vessels transited the Strait of Hormuz — 8 inbound, 7 outbound.

Five of the 8 inbound vessels are flagged to high-risk or sanctions-associated registries — Angola, Netherlands Caribbean (×2), Malawi, and Comoros — all classified as High smuggling risk.

Taken together, these cases show that the blockade is influencing vessel decisions in real time, but without consistent outcomes. Monitoring vessels that have not yet completed transit will be critical, as their progression, reversal, or disruption will define the next phase of enforcement behavior. (…)

Vessel behavior confirms a fragmented response to the blockade. Turnarounds, drifting, dark activity, and coastal routing all indicate hesitation and real-time adaptation rather than uniform compliance. (…)

The U.S. blockade is beginning to shape vessel behavior without yet fully constraining movement.

Centcom’s releases don’t verify with independent data…

Pentagon Approaches Automakers, Manufacturers to Boost Weapons Production Senior defense officials have talks with GM, Ford and others about shifting some capacity

The Trump administration wants automakers and other American manufacturers to play a larger role in weapons production, reminiscent of a practice used during World War II.

Senior defense officials have held talks about producing weapons and other military supplies with the top executives of several companies, including Mary Barra, chief executive officer of General Motors, and Jim Farley, CEO of Ford Motor, according to people familiar with the discussions. (…)

The Defense Department “is committed to rapidly expanding the defense industrial base by leveraging all available commercial solutions and technologies to ensure our warfighters maintain a decisive advantage,” a Pentagon official said.

The discussions are the latest by the administration to put military manufacturing on what Defense Secretary Pete Hegseth has called a “wartime footing.” (…)

A short pause here to let you absorb this…

***

Has the Era of the Mega-Layoff Arrived? From Snap to Block to Amazon, a new template for ‘right sizing’ the workforce is spreading through C-suites—and other companies are taking note

Snap is laying off 16% of its staff. Block lopped off 40% of its workforce. Oracle, meanwhile, is shedding thousands of employees, after Amazon.com cut about 30,000 in a matter of months.

Welcome to the era of the mega-layoff. In Silicon Valley and beyond, companies that are cutting staff are doing it with a big ax. Instead of laying off people in more incremental—and less disruptive—waves, employers are seizing on the potential financial upsides of severing swaths of their workforces at once. (…)

Behind the scenes at Block, something else happened: Leaders from across the corporate world messaged the payments company’s top executives, asking for the playbook on how they might replicate such sweeping cuts at their own companies, said Amrita Ahuja, Block’s chief financial officer and chief operating officer.

“We had people kind of coming out of the woodwork,” Ahuja said in an interview. Asked if she saw Block’s layoffs of 40% of its workforce as a new template, she said: “It’s an inevitability. As a CFO, I think it’s better to be a little bit early than to be too late here.” (…)

“Most companies, if not all, could cut 30% to 50% of their workforce at any time and see no material difference in performance,” said Mo Koyfman, founder of the venture-capital firm Shine Capital and a former executive at the media company IAC.

Sure, artificial intelligence has made some work processes more efficient, allowing for fewer people in some departments, he said. But “it also has given air cover, more importantly, to execute on the right sizing that you probably needed to do a long time ago.” (…)

Regardless of the why, executives said, companies are finding a way to slash jobs and are being rewarded by investors for it.

“Others are going to follow suit,” said Beth Steinberg, a veteran human-resources executive who has spent much of her career at technology companies. “A few companies will do it, they’ll get praise.” That, she said, will encourage other leadership teams to “come back to their companies and be like, ‘We have to do huge layoffs.’” (…)

He predicts many tech companies will cut teams by 20% to 50% by the end of 2026, if only because he is watching coding tools like Anthropic’s Claude Code and OpenAI’s Codex advance so rapidly. (…)

And while much of the pain has been in the tech sector, job cuts are also happening in warehousing, logistics and other industries that ramped up hiring during the Covid era, said Dana M. Peterson, chief economist at the Conference Board. (…)

• The BLS Layoffs and Discharges data has been creeping up but, through February, is not spiking upwards.
• Indeed Job Postings had stabilized since November but have turned downward in March (through March 27):

• The March 2026 Challenger Report, though titled “March Cuts Rise 25% From February, AI Leads Reasons” is not alarming overall:

In the first quarter, employers announced 217,362 job cuts, down 16% from the 259,948 recorded in the fourth quarter of 2025, and down 56% from the 497,052 cuts announced in the first quarter of 2025.

Technology announced 18,720 job cuts in March for a total of 52,050 in 2026. That is an increase of 40% from the 37,097 cuts in this sector announced in the same period last year. It is the highest year-to-date total for the sector since 2023 when 102,391 Technology cuts were recorded.

More layoffs are likely to come from Technology companies in 2026. Last month’s total was made up primarily on a workforce reduction at Dell Inc., according to their latest annual filing. Oracle reportedly began layoffs late last month, though the company has not released a total figure. Meta, meanwhile, is undergoing layoffs in its Reality Labs division as it focuses on pivoting to artificial intelligence.

“Companies are shifting budgets toward AI investments at the expense of jobs. The actual replacing of roles can be seen in Technology companies, where AI can replace coding functions. Other industries are testing the limits of this new technology, and while it can’t replace jobs completely, it is costing jobs,” said Challenger.

In March, Artificial Intelligence (AI) led all reasons for job cuts, with 15,341 announced during the month, 25% of total cuts.

So far in 2026, AI ranks fifth year-to-date with 27,645 cuts, or roughly 13% of all job cut plans.

In 2025, companies referenced AI for 54,836 announced layoff plans, 5% of total cuts during the year.

So, yes, AI-related job losses are gaining in importance, but mainly because non-AI related losses are declining.

JOB CUT ANNOUNCEMENTS

Hiring plans rose 157% in March to 32,826 from 12,755 in February. They are up 149% from the 13,198 hiring plans in March 2025.

So far this year, employers have announced plans to hire 50,887 workers, down 6% from 53,867 new hires announced during the same period in 2025.

The US labor market is at near-stalled speed which makes AI a nice headline grabber. But stats are no confirming “a new era of mega layoffs” so far.

EMPLOYMENT YoY%

The Fed’s Beige Book: “Labor markets held steady, with employment flat to slightly up in most districts, a marginal improvement from March’s more mixed picture. Wages remained modest to moderate across all districts, with no acceleration or deceleration reported.”

U.S. Import Prices Rise Less Than Expected in March Overall import prices rose 0.8% in March

Overall import prices rose 0.8% in March, slightly lower than the downwardly revised 0.9% increase in February, the data showed.

Year-on-year prices were up 2.1%, the BLS said.

Petroleum import prices increased 9.4% as the war in Iran drove crude oil prices sharply higher. Prices for nonpetroleum imports were up 0.1%, the BLS data showed.

“Less than expected”, but up 2.1% nonetheless, +2.6% ex-petroleum, and rising

Quarterly at annual rates (Import prices exclude duties, such as tariffs imposed on imports by the Trump administration, as well as transportation costs.)

The Fed’s Beige Book: “The most consequential shift from the March Beige Book is the energy price shock now hitting the economy. Higher energy costs are adding to residual tariff pressures, and an acceleration in input costs was universal across all districts. Selling price growth is lagging input cost increases, compressing margins. The short-term inflation picture has clearly worsened.”

German Companies Increasingly Favor Asia Over US Investments

Fewer German companies are investing in the US due to President Donald Trump’s trade tariffs and instead shift their focus to China and other Asian countries, according to a survey by industry lobby group DIHK.

Among around 1,700 manufacturers polled, 44% said they planned to invest in the US, four percentage points less than in the 2025 survey and the first significant decline since the Covid-19 pandemic, the DIHK said Thursday.

China was a declared investment target for 34% of respondents, up from 31%, while the figure for the entire Asia-Pacific region jumped by five percentage points to 26%.

“The trade dispute with the US is fueling uncertainty and leading companies to postpone decisions,” said Volker Treier, DIHK’s head of foreign trade. In Asia, firms are increasingly moving to both produce and sell their products in local markets, particularly in China and India, he said. (…)

Trump and His Federal Reserve Vendetta Firing Jay Powell would delay Kevin Warsh’s confirmation and nominee’s reform agenda.

If Mr. Powell doesn’t leave when his term as Chair ends on May 15, “I’ll have to fire him,” the President said, adding “I’ve wanted to fire him, but I hate to be controversial.” Who knew? His Administration manufactured the criminal probe with no evidence of criminal wrongdoing over the Fed renovation to bully Mr. Powell into stepping down.

Instead, Mr. Powell has dug in and promised not to step down from the Fed board until the probe is concluded. His term as a governor (unlike his four-year term as Chair) doesn’t end until January 2028. That means he can stay on the board for another two years if he wants. Mr. Trump knows this, which may be why he’s threatening to fire Mr. Powell.

There he goes again. President Trump on Wednesday renewed his threat to fire Jerome Powell if the Federal Reserve Chair doesn’t sail into the sunset when his term as Chairman ends next month. His threat may be bluster, but it’s also self-destructive. Readers may have noticed this is becoming a presidential habit. (…)

By the way, Mr. Trump’s new East Wing ballroom is exceeding its initial projections. Is that a sign of Presidential incompetence? (…)

The best way to replace Mr. Powell is to drop the pretextual Justice investigation and get Mr. Warsh confirmed. Why is this so hard for the President to understand?

Why?

Trump’s Blockade Is a Crisis for Iran The economic damage is immediate and threatens the regime if it lasts.

By the WSJ Editorial Board, talking its book…

Iran’s regime has tried to make this war all about economics, and now it is getting its wish. Since Monday the U.S. Navy has quarantined Iranian ports, blocking ships from entering or exiting the Strait of Hormuz for the purpose of commerce with Iran. The economic damage to the regime is immediate, and the pain will grow the longer the blockade is sustained.

The best estimates we have are from the Foundation for Defense of Democracies’ Miad Maleki, who led the U.S. Treasury’s sanctions campaign against Iran until last year. He writes that the blockade is expected to wipe out $435 million in Iranian economic activity a day and force oil-field shut-ins within two weeks. (…)

Economic modeling by Mr. Maleki’s FDD colleagues, Elaine Dezenski and Daniel Swift, finds that the war’s current economic damage to Iran already exceeds 40% of its prewar GDP. This relies on an International Monetary Fund estimate of a 6.1% Iranian economic contraction in 2026, which they call conservative.

Mr. Maleki calculates that, without exports, surplus production would fill Iran’s oil storage capacity in about 13 days. Then Iran would have to shut-in wells, which can cause severe damage and cost it billions of dollars in annual revenue.

His conclusion? “Iran’s economic structure, heavily dependent on the Persian Gulf transit routes and energy exports, makes continued resistance economically impossible under the U.S. naval blockade.” That is, if it lasts. Iran’s regime could think President Trump won’t sustain the blockade beyond a week or two. He may have to prove it wrong with patience.

Iran’s entire economy will feel the collapse of oil exports. This includes the Revolutionary Guard, which siphons about half the revenue. Other export routes appear unable to compensate for the loss. How will Iran’s banks hold up?

The loss of imports is expected to deepen supply shortages and exacerbate Iran’s inflation, which exceeded 50% before the war. Food inflation had reached triple digits. The currency, which has lost more than 97% of its value since 2018, would also likely suffer without the foreign exchange coming in. Iran’s regime knows all this is a threat to its survival.

The regime has tried to protect itself from its own people by cutting off the internet, crushing the digital economy with it. The destruction of Iran’s productive capacity, especially in steel and petrochemicals and industries that rely on them, also portends layoffs and a spike in inflation, even without the blockade.

Oh, and the regime’s latest budget calls for tax increases. This is not a pretty picture. The shame is that this pressure didn’t begin weeks ago.

Via The Guardian:

The US military appears to be seeking to establish secure passage for non-Iranian ships in order to restart the flow of oil through the strait – and White House officials have briefed some US media that more than 20 vessels not linked to Iran have transited through the waterway since the blockade began.

But experts and analysts who track shipping movements have questioned the accuracy of those claims.

Maritime data company Kpler said “traffic through the Strait of Hormuz remains well below typical levels” and noted just six vessels crossed through the strait on Monday, when the blockade began.

Salvatore Mercogliano, a maritime historian and an associate professor at Campbell University in North Carolina, said “the Trump Administration talks a lot about ships coming through the Strait but there is no indication yet.”

Kpler has said confidence among shipowners remains weak, with uncertainty weighing on “transit decisions.”

For now, the operating environment remains high risk, limiting any meaningful recovery in flows.”

Experts have said that despite the presence of the US navy, many shipping companies will be wary of entering or leaving the strait out of fear of attacks from Iran. German shipping giant Hapag-Lloyd has said it will not resume transiting the strait for now as the situation remains tense.

From Windward:

Maritime activity in the Strait of Hormuz has entered its first full day under active U.S. enforcement, with vessel behavior indicating a fragmented and uneven response to the blockade.

Initial movements show a combination of continued transit, route deviation, and potential evasion. Sanctioned and falsely flagged vessels remain active, with some proceeding through the Strait while others delay, reverse course, or adjust routing patterns.

At the same time, Iranian oil flows continue through indirect distribution networks, with significant volumes accumulating offshore rather than transiting directly through Hormuz.

The operating environment is shifting from uncertainty to active enforcement dynamics, where compliance, evasion, and selective movement are occurring simultaneously.

Yesterday, Trump et al were talking and talking and talking:

In an interview with Fox News, which is scheduled to air later this morning, the US president said the Iran war was “close to over, yeah, I mean I view it as very close to over”. In a short preview of the interview posted on social media last night, Trump said: “If I pulled up stakes right now, it would take them [Iran] 20 years to rebuild that country. And we’re not finished.

“We’ll see what happens. I think they want to make a deal very badly.”

The clip came hours after he told the New York Post that another round of peace talks “could be happening over the next two days” in Pakistan.

Trump has previously suggested that the war was ending. In his address to the nation on 1 April, Trump said the war was “nearing completion” and could end in “two or three weeks”.

Also:

JD Vance has said Iran will “thrive” if it commits to not having a nuclear weapon. Speaking at a Turning Point USA event in Georgia, the US vice-president said Donald Trump “doesn’t want to make, like, a small deal. He wants to make the grand bargain.”

We’re going to make it economically prosperous, and we’re going to invite the Iranian people into the world economy in a way they haven’t been in my entire life.”

On the same day:

Trump told ABC News that, while an official peace agreement may not be necessary, “I think a deal is preferable because then they can rebuild.”

“They really do have a different regime now. No matter what, we took out the radicals,” he said.

Sounds like they’re preparing something…

Meanwhile:

The US is reportedly sending thousands of additional soldiers to the Middle East in an attempt to pressure Iran into a deal to end the war, according to the Washington Post.

Citing US officials, the newspaper reported that about 6,000 troops aboard the aircraft carrier USS George HW Bush and several other warships could move into the region, while 4,200 others could join them towards the end of the month. The move would coincide with the two-week ceasefire ending on 22 April.

And:

The Iranian president, Masoud Pezeshkian, said his country is not seeking war but dialogue, as he warned any attempt by the US to impose its will or force Tehran to surrender “is doomed to failure”.

In comments carried by the official Islamic Republic News Agency (IRNA), he said:

Iran is not seeking war or instability and has always emphasised dialogue and constructive engagement with various countries. However, any attempt to impose one’s will or force the country to surrender is doomed to failure, and the Iranian nation will never accept such an approach.

IMF Warns of Deep Global Downturn if War Is Prolonged International lender sees modest downgrade if war ends soon, but much weaker growth and higher inflation in worse scenarios

(…) Already, the war has been more disruptive to global energy markets than the 1973 oil crisis, the IMF’s chief economist, Pierre-Olivier Gourinchas, said in an interview. He warned that if the disruptions persist beyond this year, even after the U.S. and Iran reached a tenuous cease-fire last week, world economic growth could fall to about 2% in 2026, a sluggish rate seen only during the deepest recent downturns. (…)

In the reference scenario, the conflict resolves promptly yet still places a drag on the global economy. In that outcome, oil would average about $80 a barrel this year, and global output might grow 3.1% on a year-over-year basis, the IMF projected. That is down from the 3.4% growth recorded last year, and lower than the 3.3% the IMF projected in January.

In their adverse scenario, which assumes that the war persists but ends later this year, oil prices spend much of the year around $100 a barrel, global growth might fall farther yet, to around 2.6%. Global inflation would rise to 5.4%.

And in a severe scenario, in which the war continues into next year and keeps oil prices high, the global economy could slide into an even deeper downturn, the IMF projected. (…)

The pain from an extended war would fall unevenly across the globe. Based on the disruptions felt to date, the IMF lowered projected 2026 growth in the Middle East by 2 percentage points, to 1.9%. It also dropped projected growth in Europe by 0.2 percentage point, to 1.1%, and by 0.1 percentage point in China, to 4.4%.

Emerging-market economies that rely on fuel imports could face some of the biggest challenges, the IMF said.

The U.S., buoyed by its large energy industry and its dominant role in the artificial intelligence build-out, will likely fare better, in the IMF’s view. It cut American growth in the reference scenario by just a 10th of a percentage point, to 2.3%, compared with the January outlook. But if the war goes on, central banks such as the Federal Reserve could quickly face a no-win trade off between keeping inflation in check and cushioning a fragile economy, Gourinchas said. (…)

The longer the war continues, the more likely it will contribute to global food shortages, political instability and pain in financial markets, IMF forecasters wrote. (…)

• Treasury secretary Scott Bessent told Semafor Monday that the Federal Reserve should “wait and see” before undertaking further rate cuts.  That compares to a January speech in Minneapolis in which Bessent deemed monetary easing “the only ingredient missing for even stronger economic growth, which is why the Fed should not delay.” (ADG)
• South Korea has secured supplies of more than 270m barrels of crude oil via routes unaffected by the US blockade of the strait of Hormuz, a senior official has said. “I hereby report to the nation that visits to four countries have secured the import of 273m barrels of crude oil by the end of this year,” Kang Hoon-sik, chief of staff to the president, said. The amount is sufficient for more than three months of South Korea’s oil needs, Kang said after he returned from a trip to Kazakhstan, Oman, Saudi Arabia and Qatar.

BTW:

The producer price index (PPI) rose 0.5% in March, well below expectations. Energy prices (+8.5%) increased sharply in March as a result of higher oil prices from the Iran war, but food prices declined (-0.3%) after a sharp increase in February. The core PPI and PPI excluding food, energy, and trade services increased by 0.1% and 0.2%, respectively, both below expectations. The February growth rates for the PPI (-0.2pp to +0.5%) and core PPI (-0.2pp to +0.3%) were both revised down. Retailer and wholesaler margins declined by 0.3% and 0.2%, respectively. The ‘old methodology’ core PPI—finished goods excluding food and energy—increased by 0.2%. Core intermediate producer prices increased by 0.7%, and the prices of crude materials less food and energy increased by 0.2%.

While the topline PPI numbers were softer than expected, the PPI components relevant for PCE were stronger than our previous assumptions. Using CPI, PPI, and interim PPI data (which we seasonally adjust), we estimate a 0.33% month-over-month increase in the PCE medical care services category for the month of March.

Based on the details in the PPI and CPI reports, we estimate that the core PCE price index rose 0.27% in March (vs. our expectation of 0.22% prior to today’s PPI report), corresponding to a year-over-year rate of +3.15%. Additionally, we expect that the headline PCE price index increased 0.64% in March, or increased 3.45% from a year earlier. We estimate that market-based core PCE rose 0.25% in March. (Goldman Sachs)

Source: Goldman Sachs Global Investment Research, Department of Labor

More PPI charts from WolfStreet:

 

Surcharges Are Suddenly Everywhere—And Grumpy Americans Are Paying Up

(…) New fees or surcharges are popping up everywhere as companies search for ways to recoup their own rising costs while blaming outside pressures.

In recent weeks, package-delivery companies and airlines have announced new or higher fees, citing increasing fuel prices. Economists expect more to follow unless oil prices rapidly fall. (…)

“Consumers tend to pay less attention to surcharges than to base prices,” said Vicki Morwitz, a marketing professor at Columbia University. (…)

Companies sometimes prefer surcharges to straight price increases because they shift blame to an external force. When airlines or shipping companies label a fee a “fuel surcharge” they are pointing at a circumstance outside of their control rather than appearing to pad their margins, said Rebecca Hamilton, a marketing professor at Georgetown University. (…)

In that way, the current wave of fuel surcharges might be easier to swallow because consumers know where the increases are coming from. (…)

• Delta Air Lines CEO Ed Bastian on an earnings call recently: “Lower fuel costs would certainly help us boost our margins this year and clearly into next year as well.”

While economists focus on core inflation data, Americans are dealing with total inflation hits:

Late Payments Rising for Buy Now, Pay Later, Survey Says

Nearly half of Buy Now, Pay Later users say they’ve paid late on at least one of their installment loans in the past year, according to a survey released on Monday. (…)

Not only have 47% of borrowers paid late on a Buy Now, Pay Later loan within the last year — up six percentage points from 2025 and 13 percentage points from two years ago — but 54% also said that they wouldn’t be able to make ends meet without the loans.

Amid rising affordability concerns and expectations for further-inflated prices this year, US consumers are also increasingly using the installment loans for essentials: 29% said they’ve used the loans for groceries, up from 25% a year ago and 14% two years ago. It’s also more common for borrowers to hold multiple loans at a time, according to the survey, up slightly at 24% from 23% last year.

“This is just further proof of how many Americans are struggling with high prices today and looking for ways to make ends meet,” said Matt Schulz, chief consumer finance analyst at LendingTree. “They’re increasingly paying late, taking out multiple loans at a time and using these BNPL loans for essentials like groceries. None of that is a sign of a confident, thriving consumer.” (…)

John Authers adds:

Beyond the US, usage rose by more than 30% last month, while Klarna’s app download climbed by more than 48% year-on-year. But the challenge is to turn this popularity into profit without being dragged down by increasingly fragile consumers. Businesses are slowly tweaking their business models to stay competitive, as Jason Mikula points out in this Substack. Perhaps they’re coming to realize that their services may fulfill a need for people, but there may simply not be enough margin to go around.

‘Power in the hands of people’: union leaders push to revive ailing US labor movement

Leaders of some of the largest unions in the US have unveiled a drive to jumpstart the country’s ailing labor movement and combat growing wealth inequality under Donald Trump.

To make it easier for workers to join a union, and strengthen the hand of new unions negotiating with powerful businesses, a string of prominent organizers joined together to launch Union Now, a non-profit designed to increase labor union density. (…)

Union density in the US was more than 30% in the 1950s, but declined precipitously over the ensuing decades. It stood at just 10% in 2025, despite opinion polls indicating vast public approval and support for labor unions.

The number of union members in the US peaked in 1979 at 21 million members, compared with 14.7 million today. Over the same period, the US population has grown by more than 100 million. (…)

FYI:

The Canadian travel boycott of the U.S. shows no signs of letting up, with visitation from the country down 35% since President Donald Trump returned to office, data released Monday from Statistics Canada show. The boycott has dealt a massive blow to the U.S. economy:

• 35% The decline in Canadians taking road trips into the U.S. compared to March 2024
• 5% The increase in Canadian visitation overseas year-over-year, a sign Canadians are swapping the U.S. for other international destinations (Forbes)

EU Agrees to Double Steel Tariffs

The European Union approved a plan to double tariffs on steel imports above a certain quota in a bid to shield the bloc’s struggling sector from a glut of foreign imports.

The European parliament struck a deal late Monday to cut the amount of tariff-free steel imports by almost half to 18.3 million metric tons a year and raise tariffs on imports above that quota to 50%.

“The shape and global standing of Europe’s steel sector are fundamental to our strategic autonomy and industrial strength,” Maros Sefcovic, the EU’s top trade negotiator, said. “We therefore cannot afford to turn a blind eye to global overcapacity reaching critical levels.” The deal brings much-needed stability for European steel producers, he added. (…)

Global excess capacity increased to 640 million tons in 2025, according to research by the Organization for Economic Cooperation and Development. (…)

Governments worldwide are increasingly turning to tariffs to protect their domestic industries. The U.S. imposed a 50% tariff on almost all imports and products made with steel last year, though it is now adjusting that tariff system.

Grand Bargain?

David and I see this possible scenario:

• On the critical civilian nuclear issue, the US and Iran find a way to close the gap between 20 years (US) and 5 years (Iran) and agree on other stuff nuclear-related. Sounds easier said than done but this is the main issue and both sides know it must be agreed upon before anything else. The nuclear issue is solvable in the sense that questions of levels of enrichment, sunset clauses and what to do with the existing stash of highly enriched uranium can and have been successfully negotiated before. Otherwise, an indefinite war, potentially expanding, and a world recession. Everybody loses with the US and Trump bigger losers, tagged as responsible for the mess. China is surely intervening to avoid the worst.
• The US declares that Hormuz is not its problem. Iran and the GCCs find a mutually acceptable modus operandi including a toll system that can be used to pay for reparations. Iran demonstrated the leverage potential such strategically significant straits carry and the world will need to find ways and means to deal with such potential threats around the world.
• Israel, isolated, concentrates on Lebanon with its own challenges. Maybe this will help diffuse this other developing problem:

Turkish Foreign Minister Hakan Fidan fired a direct warning at Athens and Nicosia on Monday [last week], saying their military cooperation with Israel “does not bring more trust, it brings more mistrust. It brings more problems and war.” He made the remarks in an interview with the state-run Anadolu Agency.

Greece and Cyprus have deepened defense ties with Israel in recent years, including joint military exercises and basing agreements, moves Turkey has consistently opposed.

Fidan claimed Greece is pursuing “extremely dangerous policies” that no other European country follows on its own, and questioned the strategic logic behind Athens seeking military ties with Israel given that Greece is already a NATO member. He said neither Greece nor what he called the “Greek Cypriot Administration” have any need for Israeli military cooperation, adding that neither side could justify the arrangement to him.

The Turkish minister also warned that Israel may attempt to frame Turkey as its next adversary after Iran, saying Israel “cannot survive without an enemy.” He described Israeli operations in Lebanon as similar to Gaza and called Israeli strikes in Syria a “serious threat” to Turkey.

• Other, more secondary, issues are compromised by all parties (guarantee of nonaggression, sanctions, etc.)

Not completely unrelated:

Donald Trump said he had given the UK “a good trade deal, better than I had to, which can always be changed.”

The Art of The Deal…

BTW:

The Defense Department’s Drone Dominance push is designed to arm American troops with expendable drones on a massive scale in a few short years.

A Pentagon competition to build out a killer drone fleet ended with a small British company crushing American contractors on their own turf

Skycutter — the British company with frontline Ukraine experience — entered the Shrike 10-F, a 10-inch drone that can be operated via fiber optic cable to counter electronic jamming and spoofing.

• The drone is the result of collaboration with SkyFall, a Ukrainian outfit.
• “They make one every 23 seconds, 123,000 units per month,” Vincent Gardner, Skycutter’s operations director, told Axios. “We redesigned it with them to exclude any Chinese parts or components.”

Skycutter scored an overall 99.3 at an attack drone fly-off at Fort Benning in Georgia. In second was Neros, a Southern California startup, at 87.5. (Axios)