Having spent July celebrating a consumer sentiment "recovery" that consisted entirely of Americans feeling as good as they did before the war started, the University of Michigan has now delivered the inevitable August sequel: sentiment tumbled from 55.2 to 51.0 — missing the 55.0 expected — as the Middle East re-escalated, gasoline prices climbed, and consumers rediscovered that the ceasefire they were briefly cheerful about had been cancelled, re-bombed, and reduced to one vessel transiting Hormuz on a Wednesday. Both Current Conditions and Expectations tumbled, with Republicans posting the steepest monthly decline and sentiment among them now sitting 19% below pre-Iran-conflict readings — the lowest since the 2024 election — a delightful reversal for the demographic that spent the past year insisting the economy was fine.
The US consumer sentiment "recovery" evaporated the moment the war restarted — because it was never a recovery in the first place. It was a ceasefire dividend with a 30-day expiry.
In a development that will have Warren Buffett quietly muttering into his cherry Coke, the post-Oracle-of-Omaha era at Berkshire has officially arrived: new CEO Greg Abel spent a net $20 billion on equities in Q2, including — brace yourself — a $10 billion cheque to Alphabet to fund its AI ambitions, marking the exact moment Berkshire, the conglomerate that spent decades religiously avoiding tech and lecturing everyone about circle-of-competence, finally bought the AI hype right as the Magnificent 7 became the year's biggest laggard. Abel also handed $6.8 billion to homebuilder Taylor Morrison, added to Delta, Lennar, and — in a truly poetic touch — Macy's and the New York Times, while trimming Bank of America, Kroger, and Capital One, and exiting Constellation Brands entirely. The genuinely instructive detail, however, is buried beneath the shopping spree: even after spending $20 billion, Berkshire still sits on $365.5 billion in cash — down from a record $397 billion but still a mountain of dry powder.
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🤵 The Macro Butler Weekly Digest 🤵
🌐 The world can pump crude almost anywhere — but only a few fiendishly complex refineries turn it into what moves civilization. 🌐
Read more here: https://themacrobutler.substack.com/p/the-alchemy-of-crude
🌐 The world can pump crude almost anywhere — but only a few fiendishly complex refineries turn it into what moves civilization. 🌐
Read more here: https://themacrobutler.substack.com/p/the-alchemy-of-crude
Substack
The Alchemy of Crude
The world can pump crude almost anywhere — but only a few fiendishly complex refineries turn it into what moves civilization.
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