Blain's Morning Porridge

Blain’s Morning Porridge November 12th, 2026 “Fish rot from the head down….”Jensen Huang is toast. His fall will trigger doubts and weakness but also demands to know more. Huang has been caught. Who has not? How much more rank corruption is waiting to be exposed among the entitled denizens of the court of King Donald? What sordid skeletons from the past may be reawakened? Key Takeaways: Nvidia’s dependence on Jensen Huang is now exposed as a major market risk. The dominant firm within the AI industry lacks clear succession planning and Huang was seen as the acceptable face of AI by the public.Confidence in the AI sector has been wobbling for months. Huang’s departure could lead to instability and trigger another collapse.The risks could be exacerbated by rising US interest rates.The AI Circularity trade – whereby Nvidia Chips have been financed by Nvidia funding customers through a complex series of trades – could break down.The broader concern is how widely the Tech Bro Billionaires who have basked in the adulation of the president since his inauguration may be undermined by Huang’s departure. Who might be next to be exposed as the Trump era ends?The risk to the Tech sector could rise as an angry public demand corruption is investigated, leading to a resurgence of questions about Epstein.Michael Power, my tech and AI go-to-guy, called late last night from South Africa with the appropriate Warren Buffet quote: “There’s never just one cockroach in the kitchen.”An hour or so earlier, I’d been a guest on The BBC’s World Business Report , on air when the news broke.Continued/ go to www.morningporridge.com for access to the full story.If you subscribe to the full Morning Porridge you get the email every morning and links to videos and podcasts…

Blain’s Morning Porridge November 11th, 2026“The Flowers of the Forest are a’ wede away.”To avoid war we must be prepared to fight – that a basic dictum from history. While the conflict pressures mount, and political systems are increasingly strained, the defence of Western Economies in a post-Nato era will require massive private capital investment. But many investors are not prepared to step up and finance defence. It’s an attitude that has to change.Key Takeaways: The West needs to rearm to avoid having to fight a future war. The establishment of strategic deterrence to force Russia to stand down is critical. Russia is milking Trump’s appeasement.Europe’s readiness depends on the resilience of its people and its capacity to sustain a fight. Not only do we require deeper reserves of trained warfighters, but secure supply lines for ammunition, equipment and parts and the ability to protect them.Europe needs strategic control of its defence infrastructure. Elon Musk’s abuse of Ukraine when he shut down Starlink and the suspicion a corrupt US president may use kill switches in US kit to favour Russia, means domestic sourcing and control is paramount.US investors are moving fast to garner control of the new emergent defence technologies, understanding how the defence market is changing. European investors are proving slow to embrace defence investment.If Europe is to control its destiny, and maintain control over strategic defence assets, then domestic investors need to step up and finance them.The guns fell silent this day in 1918. The War to end all Wars. Who were we kidding?This morning’s photo is Private William Patterson of the 1st Battalion, The Cameronians / Scottish Rifles, shortly before he departed for the Western Front in 1915. He is my maternal grandfather.Continued/ go to www.morningporridge.com for access to the full story.If you subscribe to the full Morning Porridge you get the email every morning and links to videos and podcasts…

Blain’s Morning Porridge November 10th, 2026“Europe… an imagined notion separated from reality by the Channel and the fog.”The Brexit Debate is never going to end. But the UK and Europe need to look to the future. The World in 2026 is very different to what short-term populist politicians thought they were selling us in 2016. A new relationship around trade, cooperation, and security, is possible and positive. Moreover, there is an easy win that could accelerate European growth – strengthening and unifying European Capital Markets!Key Takeaways: Brexit has proved a fundamental mistake. It was a gamble on a World that no longer exists. New trading relationships were missed, and now the War in Ukraine and the breakdown of the US security umbrella make closer UK-Europe security cooperation a necessity.There is an easy win to be had for re-engaging with Europe. The long-delayed integration of European capital markets to funnel the wealth of Europe into regional growth could give it similar heft as the USA in developing and growing new tech business of the future.London, in particular, could reap a second Big Bang through leadership of new pan-European Capital Markets, while reinvigorating other European capitals as leading financial centres.The alternative is for US firms to continue using the depth of US capital markets to harvest and exploit European innovation and invention, while arbitraging European Assets.Defence is one aspect – European defence desperately needs private capital to grow the new innovative new weaponry required on the battle space, but the bulk of funding is coming from US firms. Peter Thiel’s latest LOTR themed ploy is a defence fund scooping up European capabilities on the cheap!Brexit was a particularly British mistake. Badly done and badly executed. Political opportunism ran into bureaucracy and a legalistic approach to the negotiations.A new European-UK relationship does not require the UK to rejoin Europe, but a coming together on trade, security and capital markets.In 2016 I surprised many of my chums by voting for Brexit.I have never claimed to be particularly intelligent – and I guess that’s the proof. It cost me much of my limited credibility. Many clients and media contacts sidelined me - how I could be a market-literate, soft-left-capitalist, a free-marketeer and a Brexiteer?Easy. I voted for Brexit because I am essentially chaotic.Continued/ go to www.morningporridge.com for access to the full story.If you subscribe to the full Morning Porridge you get the email every morning and links to videos and podcasts…

Blain’s Morning Porridge, Nov 9th, 2026 “Stock prices are the weighted sum of dreams, hopes and prayers. Bond spreads reflect brutal reality and truth.”This is looking a critical week for AI. Some market watchers see last week’s wobbles as a brief bout of indigestion with the market poised for further gravity defying upside. Or have we already seen Peak-AI? The most likely clues on direction are not in stock prices, but in bond spreads, where traders are rightly concerned there is a mismatch between spending and likely revenues!Key takeaways:Anthropic has seen its IPO valuation pretty much draw a bell curve from $1 trillion to $2 trillion and pretty much back again – it’s a good proxy for the market’s view of AI.Can AI revenues grow fast enough to justify the massive build-out costs and sustain valuations? AI is now perceived as a business cost rather than advantage.Although equity prices may bounce higher on the back of renewed optimism and “buy-the-dip” mentality, Credit spreads on the AI spenders will be the critical factor – they are under enormous pressure.CoreWeave 5-year Credit Default Swaps are quoted at +1270!Even if there is a large-scale, bubble-bursting AI shake out, the outcome will be similar to the dot.com bubble – that AI becomes core technology and part of the future economy. There will be enormous value in its component parts – at the right valuations.On Friday I found myself explaining the current AI market wobbles on the BBC. I started by suggesting viewers should step back and look at how expectations for the price of the Anthropic IPO have shifted as a proxy for how sentiment towards the AI sector has been evolving from frothy upside towards cold, hard logic. Draw a bell-curve from $1 trillion to $2 trillion and back to $1 trillion, and that pretty much explains it.I suspect AI will dominate market moves on what promises to be yet another challenging week. There is so much noise out there, the trick is to focus on what matters and what does not. There is so much to pick and choose from:Continued/ go to www.morningporridge.com for access to the full story.If you subscribe to the full Morning Porridge you get the email every morning and links to videos and podcasts…

Blain’s Morning Porridge November 6th, 2026“The needs of the many outweigh the needs of the few…”Elon Musk has been described as the biggest loser from the Blue Tsunami midterms – what will it mean for his firms’ valuations, and his future influence. We need to know what really went on between Musk and Trump. Even more critical is the utility of SpaceX’s technology and Starlink’s satellite constellation as a Strategic Resource. Some tough decisions, but sensible choices lie ahead. Key TakeawaysThe defence and security of any nation is the number one priority. The emergence of new technologies with defence and strategic deterrence implications raises issues about how best to manage and deploy them.Strategically critical infrastructure and resources should be democratically accountable. Launch systems and satellite constellations are critical strategic resources.Should the control of inventions critical to national security remain in the hands of inventors or the state? History is littered with examples of how states can combine entrepreneurship with security, and balance wealth and power with accountability.The number one concern of US voters in the recent Midterms was corruption. Political power and influence create business and valuation risks. The money Musk spent supporting Trump, and the subsequent sacking of inspectors investigating Tesla and Space X after the 2024 Presidential election, needs investigation.There is a strong case for the nationalisation of Space X’s delivery capabilities and the Starlink satellite constellation, but that will raise many issues around rewarding entrepreneurial innovation vs private enterprise overriding national interests.Its Friday… so let’s have a story in three acts…Act IThe cognoscenti of the aerospace industry rank Sir Frank Whittle among the greatest engineers in history. He is certainly very high on the list of those insufficiently recognised for their achievements. Whittle invented the Jet Engine – one of the most valuable and important inventions of the 20th Century.Continued/ go to www.morningporridge.com for access to the full story.If you subscribe to the full Morning Porridge you get the email every morning and links to videos and podcasts…

Blain’s Morning Porridge November 5th, 2026 “A liquidity crash is not the bottom – it’s a sign the bottom is still to come!”All is not smooth in the credit markets. There are signs of change upon the waters and in the sky. Spreads are widening, liquidity has got tight, and now we have a fund in serious trouble even as corporates try to raise as much as possible before rates rise or markets stall. The hyperscalers are having to pay up for debt – and that’s likely to drag spreads higher. I see trouble ahead…Key TakeawaysThe imminent death-spiral at London Credit Fund Arini demonstrates a new liquidity freeze. It’s been caught by distressed positions, covenant lite deals, and margin calls – and is now at the mercy of potential distressed buyers.There are parallels with the 1998 LTCM crisis – and 2008, posing questions about what happens when clever assumptions about markets break down and result in a wave of contagion.Patient capital – and distressed debt players – will seek to buy as the market tumbles, but history suggests the current crisis at Arini probably isn’t the bottom – just the opening salvo of a deeper credit crisis across other firms.Hyperscalers have funded nearly $350 bln from bond markets in the last 2 years – causing their borrowing costs to rise and crowding out other issuers. There are significant risks there current high and rising leverage morphs into danger levels as AI costs rise.Credit ratings today are no guarantee of credit ratings tomorrow. Even industrial giants like the US auto firms went from investment grade to bust in just a few short years – briefly!Today is November 5th when we celebrate Guy Fawkes and the Gunpowder Plot of 1605! If you are looking for a Boom today… look no further than the Credit Markets.Arini Capital Management, the upstart new credit fund on the block, has seen its $7 bln credit strategy fund hammered over the last few weeks. It has AUM of $22 bln. Just 2 months ago it was proudly announcing a new lending business. Today it looks to be spinning into an illiquidity death spiral.Continued/ go to www.morningporridge.com for access to the full story.If you subscribe to the full Morning Porridge you get the email every morning and links to videos and podcasts…

Blain’s Morning Porridge November 4th, 2026“It’s worse than I imagined. I never thought we would lose South Carolina.”Democracy wins. Trump was rejected by American voters, but his legacy will remain. The damage to done to the economy, the institutions of state, the constitution, and global power will shape America and geopolitics for decades. It’s unclear how the rest of Trump’s lame duck presidency will play out, but Corruption and the nexus of Wealth and Power will come under massively heightened scrutiny. Should the next US administration nationalise SpaceX?Key TakeawaysGridlock may reassure markets – the Democrats will seek to contain Trump in Congress, while Trump will veto their proposals. Little can happen – unless Republicans (keen to show “clean hands”) cross the floor.Corruption will be the defining political battleground. Republican contenders will dance between critical MAGA support and showing they aren’t Trump puppies. The Democrats will want to investigate everything – rather than setting a new plan for a reinvigorated America.Billionaire political donations demand investigation and democratic accountability.Elon Musk is an example of wealth, power and a lack of accountability. When such individuals control strategic resources, the state may be forced to act.US Voters delivered their verdict on Trump yesterday with both barrels – the greatest electoral defeat ever inflicted on a sitting president.Commentators and the media had focused on how Trump’s electoral base of Republican and MAGA voters, and minorities like Hispanics, Blacks and Young Men might be thinking in terms of switching. But the commentariat largely ignored the Never-Again-Trump voters who turned out their millions to express their revulsion at what Trump has done to their nation. There was little written about how the bulk of American’s are horrified by Trump and everything he represents.Many Americans will have welcomed last night as a cathartic reset moment.But the world does not stand still. What’s done is done. Politics and geopolitics are a continuum – Trump’s actions (and those of the people he surrounded himself with) have already set the likely pathways for our futures. Their actions have triggered consequences which will resonate round politics, wealth, prosperity and conflict for decades.Continued/ go to www.morningporridge.com for access to the full story.If you subscribe to the full Morning Porridge you get the email every morning and links to videos and podcasts…

Blain’s Morning Porridge November 3rd 2026 “Are you better off than you were two years ago?”Today’s US Midterms are a Referendum on the Presidency – and will be consequential for global markets. The result will depend entirely how many Republicans are still minded to Vote for MAGA. They might want to think back to an earlier age, the Republican President Ronald Reagan, and ask what the current incumbent and Reagan have in common, if anything.Key TakewaysRonald Reagan is a benchmark of Presidential Leadership. He was the great communicator who represented optimism, competency, bipartisanship, respect for the Office, Constitution and Institutions of the State.Reagan understood that America’s strength lay in its economic credibility and its alliances.In 2029 the next American President will inherit the massive task of repairing confidence in Government, repairing the divisions, restoring trust in the institutions of The State and rebuilding America’s frayed global standing.The immediate market risk is how the President will respond to defeat in the polls, but longer term how global markets weigh the likelihood the USA, the dollar and the Treasury market can recover from the current aberration.The Democrats are weak and ill-organised. The Republicans have been captured by the Populist and self-serving MAGA party. Maybe something new has to emerge?America votes for its Legislature today. The Election of Congress and 1/3 of the Senate comes 2 years into the President’s term in Executive Office. The Midterms are effectively a referendum on how the President is doing.Many of my US friends believe MAGA candidates will do much better than the polls and prediction markets indicate. They point to how Polls tend to underestimate Republican support.Why?Continued/ go to www.morningporridge.com for access to the full story.If you subscribe to the full Morning Porridge you get the email every morning and links to videos and podcasts…

Blain’s Morning Porridge November 2nd, 2026“Fascism is a counter-revolution against a revolution that never took place.”Rising market instability looks inevitable as the AI meltdown, the US Midterms and European political riots, and the geopolitical risks from the US vs China hegemonic challenge reach crisis points concurrently. It’s a classic Three Body Problem – making it almost impossible to logically predict what happens next. Sit back and watch for the opportunities – they will emerge, but not where you expect them.Key Takeaways:There is rising market contagion risk as the AI bubble implodes, hitting credit spreads, circularity financing, stocks and liquidity.A sharp correction will create potential buying opportunities at attractive valuations.The US Midterms are unlikely to change much. There will be deeper polarisation and gridlock as Trump will try to push through despite his TACO reputation. The distraction will focus global investment elsewhere.European populism is another source of rising instability reducing the prospect of unified action in policy, growth and defence.Fermented Geopolitical distractions will keep the West guessing and force investors to look wider for returns.The consequential risks of the current instability include rising political unrest, dysfunctional government, an inability of authorities and regulators to address crisis, and rising inflation and recession risks alongside a more fundamental market selloff.And so, it begins…An interesting week ahead for markets might be the understatement of all time… Sit back, relax, and let the world as we know it ferment, and wait to see what coalesces around the outcomes…World events and market cycles come and go. Some are short cycles, some are long, and all cycles follow familiar tracks of rise, peak, crisis, decline and recovery, with consequent impacts on sentiment. Every cycle generates walls of worry for markets, and opportunities for politicians to fret and panic around. Having seen a good number of market meltdowns and crashes… meh! what’s another?Continued/ go to www.morningporridge.com for access to the full story.If you subscribe to the full Morning Porridge you get the email every morning and links to videos and podcasts…

Blain’s Morning Porridge 30th, October 2026“But it’s the thin red line of heroes when the drums begin to roll…”Nobody wants to pay taxes or spend money on defence. But both are inevitable. Investment in security has the potential for significant returns for investors and can drive considerable economic gains for nations that spend wisely. History is written by the victors, but the costs of underfunded defence are very clear – ask the losers how well scrimping on Defence worked for them.Key Takeaways:Defence will be a long-term investment theme. Geopolitical challenge and technological rivalry mean conflict risks are rising at a time when the West’s military capabilities are weak and industrial resilience is low.High spending is not the answer – investing in effective defence capabilities is!  Layered Air Defence and Autonomous systems are the most urgent defence requirement – both require massive investment.Private capital will be needed, and defence funds need to demonstrate how they can make above market returns.Earlier this week I read a research note from a noted equity firm. “Given the current uncertainties and geopolitical challenges…” the author wrote, “Defence Investment should be an Absolute Priority for every asset manager.” He went on to recommend “Buys” on Boeing and Rheinmetall.Nope. Wrong. I’ve written defence already this week, but following Monday’s comment on how the next war has already begun, a number of Porridge readers called or emailed to ask about investing in defence. So, this morning:WHAT TO THINK ABOUT WHEN INVESTING IN DEFENCE.It isn’t as obvious as you might think.I’ve split this Morning’s Porridge into Five Sections:The need for Defence Investment,The back story of Defence Procurement,The immediate needs: crisis in the Air and Autonomous Warfare,The Prescriptive Defence Primes versus The Adaptive new Battlespace,Investment Considerations and Returns,And finally, a brief conclusion.Continued/ go to www.morningporridge.com for access to the full story.If you subscribe to the full Morning Porridge you get the email every morning and links to videos and podcasts…