Thursday Night Links

• The prospect of a sustained reversion in investment yields likely extends beyond the horizon of bargain-hunters’ binoculars. We may look back at historical returns and wonder why investors ever got to have it so good. We will look back and think how inefficient it once was. Can you believe people earned 8-10% in stocks and thought it should last? We may look at equity returns for the past century the way people now look at home prices. Remember when a house only cost 3x annual income? [Moontower]
• Israel & the GCC are absorbing the kinetic cost of a conflict whose primary beneficiary, counter to the mainstream narrative, is actually America (First). Qatar offline for 5 years reprices the entire global gas market in favor of US exporters for the remainder of the decade. The Gulf states face years of rebuilding. Europe faces its 2nd energy crisis in four years. Sure, the average American might face temporary moderate inflation & higher gas prices. But if you are the architect of the US empire & you view the rise of China & Chinese ASI as an existential winner takes all scenario, the collateral damage is acceptable cost. Whoever controls the energy corridors controls the monetary system. Whoever controls the monetary system & the energy supply simultaneously controls the compute infrastructure that determines which civilization builds ASI first. [_10delta_]
• Positioning Marines on islands off Iran’s coast, rather than inside Iran itself, could be a loophole that would allow Trump to claim he has kept his promise not to put American boots on the ground in Iran. “I don’t see them in Iran proper,” Miller said. “I think if you’re going to put them anywhere, the place where it would be on some of the islands that are around Iran, in the Gulf, that might give you some advantage from a tactical sense for a period of time.” [WSJ]
• EPD’s Q4 ’25 financial results were excellent (one of its best quarters in the last five years), with a positive read on both growth trajectory and return of capital potential. Given the company’s strong balance sheet, it can direct incremental free cash flow to equity holders as capital spending tapers in 2026 and 2027. At the same time, its business is expected to generate mid-single digit cash flow growth over the next two years. EPD is one of KYN’s largest holdings and is a good example of the attributes we seek for the Company’s exposure to liquids-focused midstream companies. [Kayne Anderson Energy Infrastructure Fund, Inc.]
• Contrary to popular perception, recessions are not the inevitable bust that follows an unsustainable boom, and they do not operate like wildfires that clear out economic deadwood. Recessions are caused by adverse shocks like war and energy price spikes; and far from unleashing gales of creative destruction, post-recession economic growth typically resumes the same trend as before—all pain, no gain. [Tyler Beck Goodspeed]
• For all leftists’ talk about the unaccountable power of the Tech Oligarchs, they’re being routed without a fight from their home: a city whose wealth and power they can credibly claim to have built (at least as a class), and which is among the most beautiful places on earth. This is, of course, a death-spiral move for the state of California — but the real puzzle is this: For what they’ll spend on relocation costs alone, the tech exiles could have bought the entire California political system in perpetuity. [EXIT Newsletter]
• Son of a diddly! When we last spoke a smidge over 60 days ago it was looking like REITs might have their day in the sun. Sure enough, by late February the REIT market was up nicely. However, if the REIT rally was Punxsutawney Phil, then it saw the shadow of inflation and the clouds of war and hurried back into its burrow for a continued REIT market winter – giving back all the gains garnered the last two months. [Modiv Industrial, Inc.] 
• The card economic model powers shared investment, backed by active governance, standards and fault-tolerant operations (blog). To compete against Visa, you have to build a better payment system with better economics that overcomes the shared investment of all stakeholders. Open standards are a great technology model but a terrible business one, as commercial exchange requires risk management and a clear definition of terms. Blanket law and mandated payment schemes may create compliance requirements, but they do not provide the incentives to assume risk and invest. [Tom Noyes]