“On a day like today, there’s no better way to start than with a word from scripture,” said Pete Hegseth, Secretary of War, Memorial Day weekend, addressing West Point’s 2026 graduating class. “And on a day as special as this for the 998 great Americans of this class, there’s no more fitting verse than from Isaiah 6:8. ‘Then I heard the voice of the Lord saying, Whom shall I send? And who will go for us?’ And I said, ‘Here I am. Send me,’” said Hegseth. “Four years ago, you raised your right hand, swore an oath to preserve and defend the Constitution. And in that moment, you said to your country, ‘Send me.’ And here you are,” continued Hegseth. “Throughout our storied history when soldiers said, ‘Send me.’ It didn’t matter whether they were well-equipped or poorly equipped. It didn’t matter whether they were stepping into a clear mission or a vague one, whether there were clear skies or rain. ‘Send me’ was always the determined reply. Every one of them, just like you, were called to serve something greater than themselves. Rich, poor. Country, city. Black, white. It doesn’t matter. Send me.”
Dusted off a 2023 anecdote from our daughter Liv’s experience at West Point (see below), about the process of tearing people down, building them back up. See you next Sunday. E
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Anecdote (July 2023): “If the fresh skin of an animal, cleaned and divested of all hair, fat, and other extraneous matter, be immersed in a dilute solution of tannic acid, a chemical combination ensues,” said Liv, the two of us walking, her first year done. Cadets are required to commit all sorts of passages to memory. They must be able to recite them at any moment and are inevitably called to do so when standing at attention, heart racing, eyes ahead, with a Cadre screaming commands in their faces. There is hell to pay if a single word is out of place. It is one of the many ways the Military Academies teach. One of the more profound lessons is that for us to successfully lead, we must first learn to follow. And the challenge, of course, is that the people who show real leadership potential tend to arrive at West Point with an overabundance of confidence, cockiness. In fact, such attributes are in part a requirement for admission. The first year of training is about many things, but best I can tell, the principal intention is to tear the Cadets down to the bone. The institution then spends the next three years building them back up, slowly, deliberately, holistically, so that after four years, they each have the tools necessary to lead others. “The gelatinous tissue of the skin is converted into a non-putrescible substance, impervious to and insoluble in water,” said my girl, continuing the memorized passage. This story of transformation is a metaphor; such tools have a powerful effect on us as we internalize their lessons. It had been a hard year, everything worthwhile is. The changes in her were evident, the process begun. But her light had not dimmed. “This, sir, is leather,” she said. “And I am leather Dad.”
Good luck out there,
Eric Peters
Chief Investment Officer
One River Asset Management
Week-in-Review: Mon: China IP 4.1% (6.0%e), ret sales 0.2% (2.0%e). Japan GDP SA QoQ 0.5% (0.4%e). Google and Blackstone to create new AI cloud business to compete with companies like CoreWeave. Trump says he called off planned strike on Iran after an appeal by leaders of Persian Gulf allies who called for more time to pursue a diplomatic resolution. S&P -0.1%. Tue: US pending home sales MoM 1.4% (1.0%e). Canada CPI 2.8% (3.1%e). Trump threatened to resume strikes on Iran in the coming days as a part of the push for a deal to end the war. US 30-year yield hit highest since 2007 as selloff deepened. S&P -0.7%. Wed: UK CPI 2.8% (3.0%e). Eurozone CPI 3.0% as exp. South Africa CPI 4.0% as exp. Australia unemp rate 4.5% (4.3%e). Open AI is preparing to file for an IPO in the coming weeks, targeting a public debut sometime in the fall. US Treasuries rebound on optimism for US-Iran deal progress after Trump said he was in the “final stages” of a deal. S&P +1.1%. Thu: US init jobless claims 209k (210k e), housing starts 1465k (1410k e). Mexico ret sales 2.9% (3.0%e). US to grant $2B to 9 quantum computing firms in deals that include government equity stakes. US and Iran traded threats of escalation, with Iran warning it would retaliate beyond the Middle East if the US or Israel renewed strikes. S&P +0.2%. Fri: US UMich sent 44.8 (48.2e). Mexico bi-weekly CPI -0.16% (-0.18%e), GDP NSA 0.2% (0.1%e). Kevin Warsh sworn in as Fed Reserve Chair. US Director of National Intelligence Tulsi Gabbard resigns, with Aaron Lukas, a former CIA officer to step into the role. S&P +0.4%. Sat: Trump writes that Iran deal is largely negotiated and he’ll announce it soon.
Weekly Close: S&P 500 +0.9% and VIX -1.73 at +16.70. Nikkei +3.1%, Shanghai -0.5%, Euro Stoxx +3.0%, Bovespa -0.6%, MSCI World +1.3%, MSCI Emerging +1.1%, Bitcoin -3.9%, and Ethereum -6.6%. USD rose +1.4% vs Indonesia, +0.5% vs Canada, +0.4% vs Turkey, +0.3% vs Australia, +0.3% vs Yen, and +0.2% vs Euro. USD fell -2.2% vs Russia, -1.4% vs South Africa, -0.9% vs Chile, -0.8% vs Sterling, -0.8% vs Sweden, -0.4% vs Brazil, -0.3% vs India, -0.2% vs China, and flat vs Mexico. Gold -0.9%, Silver -1.7%, Oil (WTI) -4.4%, Oil (Brent) -5.2%, NatGas (US) -1.8%, NatGas (EU) -3.0%, Power (EU) -1.7%, Copper +1.3%, Iron Ore -3.2%, Corn +1.6%. 10yr Inflation Breakevens (EU -11bps at 2.17%, US -11bps at 2.41%, JP +7bps at 2.30%, and UK -10bps at 3.46%). 2yr Notes +5bps at 4.12% and 10yr Notes -4bps at 4.56%.
YTD Equity Index Returns: Korea +76.9% priced in US dollars (+86.2% priced in won), Taiwan +45.3% priced in US dollars (+45.9% priced in Taiwan dollars), Norway +35.3% in dollars (+24.3% in krone), Israel +29.7% in dollars (+18.1% in shekels), Hungary +24.2% (+16.8%), Japan +23.6% (+25.8%), Brazil +19.5% (+9.4%), Thailand +17.5% (+22.1%), Russell +15.6%, Turkey +15.2% (+22.6%), Finland +13.8% (+15.3%), Poland +13.4% (+15.3%), NASDAQ +13.3%, Portugal +12.8% (+14%), Austria +10.9% (+12.3%), Mexico +10.6% (+6.3%), Singapore +9.7% (+9.1%), S&P 500 +9.2%, Belgium +8.9% (+10.1%), Italy +8.8% (+10.2%), Netherlands +8.7% (+9.9%), MSCI World +8.4% in US dollars, Canada +8% (+8.7%), Sweden +7.4% (+9.1%), China +6.6% (+3.6%), Australia +6.2% (-0.7%), Greece +6% (+7.1%), UK +5.3% (+5.4%), Saudi Arabia +5% (+5.1%), Vietnam +4.9% (+5.2%), Malaysia +4.2% (+1.9%), Colombia +3.4% (+0.7%), Euro Stoxx 50 +2.8% (+3.9%), Spain +2.8% (+3.9%), Switzerland +2.7% (+1.8%), Chile +0.7% (+0.8%), Germany +0.4% (+1.6%), HK -0.8% (-0.1%), France -1.5% (-0.4%), South Africa -1.7% (-2.4%), Ireland -1.8% (-0.7%), New Zealand -2.4% (-4.1%), Argentina -3% (-6.7%), UAE -3.4% (-3.3%), Denmark -5.4% (-4.2%), Philippines -5.9% (-1.5%), Czech Republic -6.1% (-4.7%), India -14.6% (-9.2%), Indonesia -32.7% (-28.7%).
Disclaimer: All characters and events contained herein are entirely fictional. Even those things that appear based on real people and actual events are products of the author’s imagination. Any similarity is merely coincidental. The numbers are unreliable. The statistics too. Consequently, this message does not contain any investment recommendation, advice, or solicitation of any sort for any product, fund or service. The views expressed are strictly those of the author, even if often times they are not actually views held by the author, or directly contradict those views genuinely held by the author. And the views may certainly differ from those of any firm or person that the author may advise, converse with, or otherwise be associated with. Lastly, any inappropriate language, innuendo or dark humor contained herein is not specifically intended to offend the reader. And besides, nothing could possibly be more offensive than the real-life actions of the inept policy makers, corrupt elected leaders and short, paranoid dictators who infest our little planet. Yet we suffer their indignities every day. Oh yeah, past performance is not indicative of future returns.