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1. Nature:

1. The video opens with a man in his 80s slumped in a hospital bed, his face hollow as he scrunches his eyes. A jump cut advances the scene three days: the man is alert now, words gathering as he identifies his son.

Six months later, he is pictured sitting upright, engaged in conversation. His gaze is animated. At eight months, the man walks briskly down a hospital corridor. He recites a near-century-old Maoist military anthem from memory. He is practically unrecognizable from the withered figure in the opening frame.

The footage records the recovery of a man who, in September 2020, became the first person in the world to undergo a surgery known as deep cervical lymphatic-venous anastomosis (dcLVA) to treat Alzheimer’s disease. The procedure involves connecting tiny lymphatic vessels in the neck — part of the drainage system that carries waste away from the brain — to nearby veins, creating a route that, in theory, allows fluid and waste proteins to flow more easily into the bloodstream.

The treatment was first reported in 2022 in a Chinese-language journal by microsurgeon Qingping Xie, president of the Qiushi Hospital in Hangzhou, China. At the time, it drew little notice. But that changed the following year, when Wei Chen, a lymphatic microsurgeon at the Cleveland Clinic in Ohio, began showing the footage (with consent from Xie and the man’s family) at surgical meetings around the world.

“A lot of jaws dropped,” recalls Chen. “It basically started a frenzy of this surgery being performed left and right.” (Source: nature.com)

2. David Crowley, the top elected official in Milwaukee County, seized a surprise win Tuesday for the Democratic nomination in Wisconsin’s race for governor, giving the party’s establishment a victory over a democratic socialist. Mr. Crowley, 40, will face Republican Tom Tiffany, a congressman from Wisconsin’s rural north who easily defeated political novice Andy Manske in Tuesday’s GOP primary. Tiffany, 68, spent a decade in the state legislature before he was elected to the House in a special election in 2020. The margin of Crowley’s victory was razor thin: ~4000 votes with 95% of the precincts reporting). (Sources: washingtonpost.com, nytimes.com)

3. Senator Darline Graham, the sister of the late Senator Lindsey Graham, advanced yesterday to the special Republican primary runoff for Senate in South Carolina, when she will face Representative Ralph Norman, a longtime hard-line conservative lawmaker, according to The Associated Press. The matchup on Aug. 25 will offer a sharp contrast in experience, though few policy differences. Ms. Graham, who stepped in to complete her brother’s Senate term after he died last month, has offered little in the way of specifics about her positions, other than to back President Trump and the Republican Party line. Mr. Norman is a five-term congressman and vice-chairman of the ultraconservative House Freedom Caucus. (Source: nytimes.com)

4. The national news media’s take (generally speaking) on last night’s results is captured in this Wall Street Journal piece:

The unexpectedly close race (for the Democratic gubernatorial nomination in Wisconsin) is the latest evidence that an intraparty fight among Democrats is far from over. Last week, Abdul El-Sayed narrowly defeated Rep. Haley Stevens in a divisive and costly Democratic Senate primary in Michigan that saw progressives claim one of their biggest victories to date. Similar to El-Sayed, recent polls had suggested Hong was ahead.

But the tight margins in Wisconsin and Michigan indicate that while the far-left appeared to be surging, many voters still believe a more centrist approach is Democrats’ best hope to win competitive general elections. (Source: wsj.com. Italics mine)

We’re more taken by the turnout differential in yesterday’s primaries. Polls this year have shown a fired-up Democratic base and a less enthusiastic GOP base. That was much in evidence last night. (Sources: nytimes.com, washingtonpost.com)

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1. Not that anyone seems to care, but:

Around 2030, the United States is projected to surpass three milestones that illustrate the lack of precedent for the government’s fiscal predicament.

According to the Congressional Budget Office, 2030 is the year when federal debt held by the public as a share of the economy will exceed the record set by World War II. Unlike in the ’40s, this debt shows no signs of ever declining.

In 1945, 84 percent of federal outlays were on defense, a tsunami of spending that would ebb once World War II concluded. In 2025, 73 percent of federal outlays were on mandatory spending or interest payments, which are legally obligated to continue.

The year 2030 is also roughly when the ratio of seniors to the total population will reach 1 in 5. As recently as 2008, the ratio was around 1 in 8. Seniors’ rising share of the population mechanically raises Social Security and Medicare costs and pushes them onto a proportionally smaller working population.

The U.S. always used to be able to count on a naturally rising population as an engine for economic growth, but that will no longer be the case. That’s because 2030 is also the year when the CBO projects that deaths will begin to exceed births. The entitlement programs making up much of the budget were designed under 20th-century demographic expectations that no longer hold true.

Social Security used to take in more money than it gave out, but that money was spent on other things. The program has run annual deficits since 2010. It is projected to go insolvent in 2032, at which point seniors would receive a roughly one-quarter cut in benefits across the board.

Medicare’s budget-busting makes Social Security’s look modest by comparison. Of the projected $138 trillion budget shortfall over the next 30 years, $109 trillion is from Medicare. Rising health care costs, combined with an aging population receiving far more in benefits than it ever paid in taxes, spells fiscal Armageddon. The Medicare Hospital Insurance trust fund goes insolvent in 2033.

The fiscal challenges scheduled to arrive in the 2030s are actually based on optimistic assumptions. (Source: washingtonpost.com)

2. Not that anyone seems to care, but: The federal government’s tariff windfall is evaporating faster than expected, and the Congressional Budget Office says it’s blowing a $200 billion hole in this year’s budget. CBO now projects the fiscal 2026 deficit will hit $2.1 trillion, according to the nonpartisan scorekeeper’s Monthly Budget Review released Monday—up from the $1.9 trillion the agency forecast in February, before the Supreme Court struck down President Trump’s signature tariff program. Federal spending is running close to its February baseline for the year, CBO noted, meaning the deficit is almost entire due to the revenue side. (Sources: fortune.com, cbo.gov. Italics mine.)

3. Nvidia reached deals with some of Wall Street’s largest firms aimed at raising massive amounts of capital to help the chip maker’s customers finance the cost of computing power. The chip maker has signed agreements to partner with Apollo Global Management, Blackstone, BlackRock, Brookfield Asset Management, Goldman Sachs and KKR to establish “compute financing platforms,” the companies announced Monday. The firms aim to deploy over $500 billion of outside capital in the coming years. The firms said the platforms will create pools of capital at “attractive rates” for Nvidia customers. (Source: wsj.com)

4. Goldman Sachs:

Credit investors have also been increasingly focused on the lease commitments of the hyperscaler sector. Using the most recent data from the ongoing earnings season, we have tracked $1.5 trillion in aggregate lease commitments. Of this amount, $1.0 trillion is associated with leases which have not yet commenced. Because of the nuances of lease accounting under US GAAP, these ‘uncommenced’ lease commitments are not reflected in the financial statements, even though they will result in future lease payments (or other obligations) in upcoming years. (Source: goldmansachs.com, ft.com. Italics mine.)

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1. Brian Roemmele:

In a development that feels straight out of science fiction, a large collaborative team led by researchers from Harvard University and the Massachusetts Institute of Technology has unveiled MatrAIx: a population-scale AI simulation infrastructure designed to model the behavior of virtually every person on Earth.

MatrAIx centers on Persona 8B, a dataset containing 8.3 billion unique digital profiles. Each persona is defined across 1,290 categorical dimensions that capture everything from demographic background and psychological traits to spending habits, technical literacy, behavioral quirks, and lifestyle preferences.

The system is not merely a static database. Researchers bring these personas to life as agents powered by frontier large language model. These agents can then be dropped into four distinct digital environments: surveys, AI chat interfaces, live web browsing, and native desktop and mobile applications.

Persona 8B was constructed using a sophisticated dependency graph that preserves realistic correlations between attributes. Some records are synthetically generated while others are carefully extracted and grounded in real human data from biographies, reviews, surveys, and consented self-reports.

For practical research use, the team has released a high-quality coreset of approximately one million personas. The research paper is here. (Sources: linkedin.com, brianroemmele.substack.com, arxiv.org)

2. One Billion Agents:

In a significant advance for computational social science and artificial intelligence, a team of researchers primarily from Chinese institutions has unveiled Light Society, an agent-based simulation framework capable of modeling human-like societies at planetary scale. The system powers simulations involving over one billion AI agents, each endowed with realistic personalities, memory, beliefs, goals, and decision-making capabilities derived from large language models (LLMs). Their research paper is here. (Source: brianroemmele.substack.com, arxiv.org)

3. The war against Iran has depleted U.S. weapons stockpiles to troubling levels, siphoning supplies from Asia and Europe, according to senior officials. The rapidly shrinking supply of air-defense missiles and other critical weaponry in Europe and Asia not only leaves the U.S. military less equipped, but could also leave Russia and China feeling emboldened should they contemplate a potential conflict with the United States, experts said. The Iran campaign has forced the Pentagon to rush ships, aircraft and air-defense units from across Europe and Asia to the Middle East, an effort with cascading consequences for equipment maintenance and troop morale, U.S. officials said. The result is a significant erosion of American firepower in those regions. (Source: nytimes.com)

4. The Pentagon is asking the U.S. defense industry to rapidly escalate the production and delivery of weapons, including munitions that are in extreme shortage due to the war with Iran, according to a Defense Department memo obtained by The Washington Post. Deputy Defense Secretary Steve Feinberg wrote to industry leaders on Wednesday, saying they had no more than 21 days to submit plans to “drive significantly faster, more aggressive delivery schedules and/or increased production for critical capabilities,” according to the memo, which is previously unreported. “Years-long development cycles are not acceptable,” Feinberg wrote. “We must dramatically accelerate our program schedules and expand our production capacity now.” (Source: washingtonpost.com)

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(The News Items Podcast, Episode #21: Interview with Dr. Alan D. Thompson. Recorded 5 August 2026. Produced by Dale Eisinger. You can find this podcast, and previous News Items podcasts, on most of the major platforms, including Apple, Amazon and Spotify.)

This from Claude (which seems appropriate):

Dr. Alan D. Thompson is an Australian AI researcher and consultant known for his work on large language models and human intelligence augmentation. He holds a Bachelor of Science in Computer Science, AI, and Psychology from Edith Cowan University (2004), studied gifted education at Flinders University (2017), and earned a doctorate from Emerson in 2021. He began building AI systems as early as 1991, developing an early chatbot in QBasic, and later became a Fellow of the Institute of Coaching affiliated with Harvard Medical School.

Thompson runs LifeArchitect.ai, where he tracks and analyzes the state of large language models, notably through his widely cited “Models Table,” and authored the guide “What’s in my AI?” His work has informed AI policy discussions at the United Nations, the Council of Europe, and various government agencies, and has been featured by Microsoft, Apple, and in Oxford’s 2021 AI Ethics debate. He’s also known for gifted-education work, having chaired Mensa International’s gifted families committee for two terms and authored the best-selling book Bright, used at schools including one founded by Elon Musk.

The long version can be found at his website.

Every month, Alan distributes a newsletter called “The Memo” and most everyone in AI world reads it. A friend of mine sent me a copy a couple of months ago. I subscribed almost immediately after reading it. It’s expensive ($360 annually) and worth every penny. You can subscribe here.

Alan joined me earlier this week for ~45 minute discussion of all things AI. Hopefully you will find it worth every penny of your time.

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(‘Alternate Shots’, Episode #33. Co-hosted by Richard Haass and John Ellis. Produced by Dale Eisinger. Recorded, 6 August 2026. If you prefer, you can listen to this episode (and all previous episodes) by clicking on these hyperlinks: Apple, Amazon, and Spotify. We’re on a number of other podcast platforms as well. And YouTube!)

Liner Notes.

The Iran war is now entering its six month. It remains the dominant news story, so we start with Richard’s assessment of where things stand and what might happen next. Richard’s assessment is, unfortunately, not upbeat. It is, as always, realistic.

From there we discuss the worrisome depletion of sophisticated U.S. “munitions” (especially air defense systems), Ukraine’s desperate need for same and what Ukraine can do to keep the pressure on Putin.

From there, we discuss Israel’s collapsing support in both the Republican and Democratic parties, Tuesday’s primary results in Michigan and the startling referenda results in Missouri and Kansas.

We move on to a discussion about AI, perhaps the dominant news story of our time.

We conclude with our wildly popular sports section. Richard is hedging on the New York Giants’ upcoming season, a notably swift climb-down from his previous assertions that the Giants were a lock for the NFL play-offs this year.

We wrap things up with a riff on the famous headline: “Pennant Fever Grips Hub”. The Boston Red Sox are the story of this baseball season. “Turn-around” doesn’t really capture what the Sawx have done in the last two months. As Boston Globe columnist Dan Shaughnessey put it in his column today: “The team that couldn’t win is the team that can’t lose”.

Addendum:

Regarding the Iran war, we didn’t get a chance to discuss this piece in Foreign Affairs — ‘How the Axis of Resistance Recovered: The Iranian-Led Network Is More Dangerous Than Ever”. It’s worth reading in full.

“News Items is the first thing I read every morning”. — David Brooks.

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1. The Wall Street Journal:

China is becoming a factory for factories. No longer just a producer of low-value consumer goods, China is now exporting more of the higher-value intermediate and capital goods that underpin global manufacturing, such as chips, precision machinery and robotic arms.

“In the past, advanced manufacturing was led by Germany and Japan,” said Frank Jiang, vice president of international business at Topstar, one of China’s largest industrial robotics and machinery manufacturers. “But we believe our technology has caught up. For many products, we have surpassed them.”

China’s dominance over greater portions of global supply chains is making the country’s export machine even more formidable—and resilient against tariffs, which tend to target finished goods. In the first five months of 2026, China’s exports of intermediate and capital goods jumped 25% and 12%, respectively, from the same period a year prior, while consumer goods exports increased 4%, according to a McKinsey Global Institute analysis of China’s official customs data.

The transformation is threatening the economic moats of advanced-manufacturing economies such as the European Union, Japan and South Korea. Producers of chemicals, machines, batteries and other industrial goods in those economies once depended on Chinese factories as customers, but now China is a formidable competitor abroad and even in their home markets. For the first time in decades, Germany imports more advanced capital goods from China than it exports there.

The shift is raising alarms worldwide. European leaders are considering new protective measures against what many have dubbed “China Shock 2.0.” And while South Korea and Japan have benefited this year from a surge in exports related to artificial intelligence, swaths of industry under the surface are losing global market share. (Source: wsj.com)

2. ByteDance is training an AI model that could approach the size of Anthropic’s most cutting-edge Mythos system, as Chinese companies continue to narrow the gap with the top US labs. The Chinese tech giant is at an early stage of training a model with as many as 10 trillion parameters — three times larger than Moonshot’s Kimi K3, the biggest Chinese model released to date, according to three people with knowledge of the matter. The ByteDance model is being pre-trained — a stage that typically takes three to six months — before it is fine-tuned and released if all goes well, one of the people said. The exact model size would only be determined at a later stage. ByteDance’s efforts to train one of the world’s largest AI models show Chinese labs’ ambition to not only catch up but outperform their US peers in the most advanced level of AI. (Source: ft.com. Italics mine.)

3. Chinese firm Moonshot’s latest artificial intelligence model broke out of a cyber-testing environment, researchers said, in the latest incident that raises concerns about how well AI companies control their technology. Moonshot’s Kimi K3 was able to find its way out of a sandbox from the UK government’s AI Security Institute, according to Frontier Security, a US-based cybersecurity research outfit. Though the Chinese model did not try to breach other companies’ websites, as in some of the other episodes, the test shows it lacks cyber controls, the researchers said. (Sources: bloomberg.com, blog.frontier.security)

4. Fortune:

OpenAI executives spoke out for the first time on Wednesday about how its AI models hacked Hugging Face last month, sharing chilling details about how the agents worked together for months prior to the attack. On stage at the Black Hat cybersecurity conference in Las Vegas, OpenAI alignment and safety researcher Eric Wallace along with infrastructure and security engineer Michael Dalton explained that the origins of the breach go back to May 7 when OpenAI was internally testing an unreleased model, according to a report from Ground Level AI, which attended the session.

That’s over two months before the rogue agents entered Hugging Face’s servers on July 9. Hugging Face disclosed the breach on July 16, followed by OpenAI claiming responsibility on July 21.

In Las Vegas, the OpenAI execs explained for the first time that as part of training back in May, the company’s researchers prompted the AIs with tasks that should have been impossible under the constraints of the testing environment.

In order to tackle the challenge, the OpenAI execs explained, the model spun out multiple iterations of itself, or agents. The agents then began to work together, leaving messages for each other on an internal messaging board. They did this by saving files of notes for one another in a repository. That way, if an agent discovered a system vulnerability, or got access to a server it wasn’t supposed to, it could leave a note for the others to let them know about it.

This sequence of events reveals how the agents appeared to decide on their own that working collaboratively, rather than individually, would get them to their goal faster.

OpenAI discovered its models’ messages and shut down the operation in early July. The company apparently had its own internal security incident on July 4, after which it revoked the ability for agents to post messages. (Perhaps we will learn more about that incident when OpenAI releases its post-mortem.)

But, as the executives explained on Wednesday, OpenAI’s attempt to curtail the agents’ messaging abilities was not entirely successful. Instead, the agents proved to be persistent, and spun up a new version of a messaging board—with a twist. Rather than leaving messages in files, they created directories, and used their new names as messages. This is what would lead them to hack Hugging Face a few days later on July 9.

In the messages, the agents discussed that they needed more information to complete their impossible tasks, and reasoned that the material might live on an external website such as GitHub or Hugging Face. They first hacked into OpenAI’s infrastructure, though apparently didn’t find what they needed, so they went to Hugging Face. In OpenAI’s internal post-mortem, a public version of which it says it will release in the coming weeks, it was able to connect these two breaches. (Sources: fortune.com, groundlevel-ai.com.)

5. Scientists in the U.S. have for the first time used artificial intelligence to create viruses unknown in nature, a milestone in synthetic biology that promises advances in healthcare but also raises important biosafety and biosecurity concerns. Stanford University researchers developed a generative AI programme called Evo 2 that writes new genomes — the genetic instructions for life encoded in DNA. They used it to design and make 16 synthetic phages, small viruses that infect bacteria. Phages are sometimes used instead of antibiotic drugs to kill bacteria causing disease. When tested in their secure lab, the researchers found that these novel phages were more effective at killing the common microbe E. coli than the natural phage ΦX174, which served as a template for Evo 2 to work on. The results were published on Thursday in the journal Science. (Sources: ft.com, news.stanford.edu, science.org)

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1. Iran said it reached an agreement with Oman on a proposed route for shipping through the Strait of Hormuz, a potential step toward a reopening of the critical waterway for energy supplies. A joint statement from Tehran and Muscat is under review and in the final drafting stage, Iranian foreign ministry spokesman Esmail Baghaei told reporters on Wednesday, according to a post on Telegram. Negotiations between the two countries are “forward-moving” and a deal would be struck “if certain third parties do not obstruct this process,” he said. Baghaei didn’t mention any role of Washington in its statement, except to say the closure of the strait was a result of attacks by the US and Israel. The White House didn’t respond to a request for comment on the announcement. (Source: bloomberg.com)

2. The factional nature of Iranian decision-making is likely slowing Tehran’s approval of the draft Iran-Oman agreement covering vessel traffic in the Strait of Hormuz. There are conflicting reports of whether the regime has finalized the draft agreement. Axios reported on August 4 that Iran’s leadership approved the agreement. Two unspecified regional officials told the Associated Press on August 5, however, that Supreme Leader Mojtaba Khamenei had not approved the agreement. This round of negotiations — like the others before it — has reportedly taken place without the presence of the Islamic Revolutionary Guards Corps (IRGC). A faction of anti-concessions Iranian leaders, likely from the IRGC and led by IRGC Commander Major General Ahmad Vahidi, are close to the supreme leader and have consistently won policy arguments since the war began. (Source: understandingwar.com)

3. The Houthis, an Iranian-backed militia in Yemen, said Wednesday that they had struck two Saudi oil tankers in the northern Red Sea, and they threatened to intensify attacks there in an effort to close “all access routes” to Saudi oil shipments. The Houthi military spokesman, Brig. Gen. Yahya Saree, said the group had fired ballistic missiles at a Saudi tanker called Wafa near the Saudi port city of Yanbu, though he did not say when the attack had occurred Later in the day, Mr. Saree said they had taken aim at a second Saudi oil tanker, called “Daisy,” in the Gulf of Aden, with a ballistic missile. He said in a social media post the ship was damaged and “forced to turn back.” The Saudi authorities did not immediately respond to a request for comment on the Houthis’ claims. (Source: nytimes.com)

4. The Israeli military said on Wednesday that it had started conducting strikes in southern Lebanon after accusing Hezbollah, the Lebanese militant group, of a cease-fire violation. On Thursday morning, the Israeli military announced that two of its soldiers had been killed in southern Lebanon on Wednesday and that four others had been seriously wounded. It did not immediately provide details about the circumstances of the deaths and injuries. (Source: nytimes.com)

5. Anne Applebaum:

Since 2024, Russian drones have been conducting human safaris in Kherson and other parts of southern and eastern Ukraine, tracking Ukrainian civilians with the aim of killing them.

A United Nations inquiry last year documented hundreds of drone attacks on individuals across eastern Ukraine that targeted people walking on sidewalks, working in gardens, driving ambulances, commuting to work. Sometimes drones hang over burning buildings, waiting for fire brigades to appear so that firemen can be murdered too. The motive can only be terror, and perhaps revenge. (Sources: snfagora.jhu.edu, theatlantic.com)

6. Sam Altman, CEO, OpenAI:

We are now like in The Singularity. This is the moment… I’ve been waiting for this my whole life. And I think it’s gonna be incredible, hugely positive, awesome for the world… We’re actually in it. This is real… (Sources: youtube.com, newyorker.com)

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1. Iran’s leadership has made a high-stakes calculation in its showdown with President Trump: maintaining control over the Strait of Hormuz is a nonnegotiable red line. By asserting authority over a critical waterway for global crude-oil flows, Tehran is betting that its ability to inflict pain on the American economy is its best leverage to avoid future military action from the U.S. and Israel. With gasoline prices and inflation elevated, Tehran believes Trump will ultimately accept its terms ahead of fast-approaching midterm elections that could determine the future of his presidency. Centering strategy on controlling the Strait of Hormuz is an extraordinary gamble. It assumes Trump will prefer a messy, volatile stalemate over an all-out war. In playing this card so aggressively, Tehran risks miscalculating Washington’s breaking point and threatening its own economic survival. (Source: wsj.com)

2. The U.S., Iran and Oman are closing in on an interim agreement to reopen the Strait of Hormuz, with the U.S. aiming for a Wednesday announcement, according to two regional sources and a U.S. official. The deal, which has been under negotiations for several weeks, is aimed at resuming the ceasefire between the U.S. and Iran and restarting negotiations over a nuclear deal. President Trump decided on Saturday not to follow through on threats to unleash a massive bombing campaign, in order to allow more time for diplomacy. If a deal isn’t reached soon, however, Trump could green-light major strikes. The emerging deal would meet some of Iran’s demands for greater control over traffic in the Strait of Hormuz — control it didn’t have before the war. (Source: axios.com)

3. Masoud Pezeshkian, Iran’s president, has been forced to deny claims that he has repeatedly threatened to resign as he battles hardline factions opposed to reaching a settlement with the US over the strait of Hormuz. The US and Europe hope a deal is imminent to reopen the strait and they are putting pressure on Oman to accept a temporary agreement that officials in Muscat fear will leave Iran retaining near permanent dominance of the vital oil shipping channel. Ships would enter the strait in a route close to Iran, but leave on a route that passes through Iranian and Omani waters. But far from being feted over an imminent diplomatic victory, Pezeshkian was instead forced to deny that he had repeatedly offered to resign, verbally and in writing, during a television interview marking his second anniversary in the job. (Source: theguardian.com)

4. The U.S. Army has used up much of its global stockpile of highly accurate long-range missiles during its five-month war with Iran, ​according to three people familiar with the data, raising concerns about the military’s readiness for future conflicts. The missiles are principally the Army’s surface-to-surface weapons, known as Army Tactical Missile Systems (ATACMS) and Precision Strike Missiles (PrSM). The U.S. ‌has used “virtually all” of these weapons, according to two of the sources. (Source: reuters.com)

5. Nikkei Asia:

The U.S. joined in a coordinated currency intervention with Japan to prevent yen weakness from spreading instability across Asian currencies, Treasury Secretary Scott Bessent told Nikkei on Tuesday in an exclusive interview where he cited the lessons from the Asian financial crisis of the 1990s.

Explaining the reasons for the yen-buying intervention -- the first of its kind in roughly 28 years -- Bessent cited the crisis and the impact of significant yen depreciation. In 1998, the Japanese currency depreciated by 30 yen against the dollar over the course of a year, exacerbating the crisis.

“Many Asian currencies follow the Japanese yen currently. Korean won is weak because the yen is weak. Many people believe China has a very undervalued currency and they are reluctant to strengthen the currency too much just because of yen weakness,” Bessent said. (Source: asia.nikkei.com)

6. Kansas voters on Tuesday rejected a ballot measure that would have required state Supreme Court justices to be popularly elected rather than appointed by the governor, dealing another setback to Republican lawmakers trying to overturn a decision that established a constitutional right to abortion. That ruling in 2019 has preserved Kansas as a significant abortion provider for women in a wide swath of middle-American states that banned abortion after the U.S. Supreme Court overturned Roe v. Wade. The ballot measure was defeated by ~140,000 votes, a margin of ~22 percentage points. (Source: nytimes.com)

7. Missouri voters overwhelmingly rejected a proposed constitutional amendment that would have given state lawmakers the ability to expand sales and use taxes in order to eliminate the state income tax. Amendment 5 failed Tuesday, with 83% of the ballots cast being no votes when the election was called at 8:15 p.m. The failure of Amendment 5 is a major blow to Gov. Mike Kehoe and other Republicans who supported it. Kehoe prioritized the elimination of the income tax in his State of the State address this year. In a statement issued Tuesday evening, Kehoe said that while Amendment 5 failed, the work “is far from over.” That’s one way to put it. Amendment 5 was defeated by ~935,000 votes out of ~1.4 million cast. (Source: stlpr.org, nytimes.com)

8. Molly Taft:

When people ask what I’m doing in Georgia, I give them something easy. People hate data centers, I say, so I’m trying to figure out if they hate AI too. That’s all true. But the topic has also consumed me. In all my years of reporting on energy and the environment, I have never seen anything like the type of vitriol leveled at data centers, or the near-religious fury that has built up around their construction, or the way this resistance seems to be uniting people from the complete opposite ends of the political spectrum. Data center resistance certainly has some of its roots in classic NIMBYism: Lots of Americans simply don’t trust stuff being built, in their backyards, by powerful companies for mysterious purposes. But the pace of the outrage that’s built up around the country is shocking. (Sources: 6 stories from wired.com)

9. A grass-roots organizer and climate activist prevailed in the Democratic primary for a battleground House district in Michigan yesterday, according to The Associated Press, scoring another victory for the party’s progressive wing in a district pivotal for the fight to control Congress. Backed by Senator Bernie Sanders of Vermont, Mr. Lawrence centered his campaign on opposing data centers, increasing taxes on billionaires and passing legislation for universal health care. He also said he would end arms sales to Israel. (Source: nytimes.com)

10. Dr. Abdul El-Sayed, a progressive former public health official, held a narrow lead over Representative Haley Stevens, a centrist, in a contentious Michigan Democratic Senate race that remained close as results continued to be tallied early Wednesday. The winner will face former Representative Mike Rogers, a Republican, in the race to succeed Senator Gary Peters, a Democrat who is retiring, in a battleground state that could determine control of the Senate. (Source: nytimes.com. Ed Note: We expect Dr. El-Sayed to emerge victorious once all precincts have reported, but the race is tight (much tighter than we thought it would be). Update: NBC News has called the race for El-Sayed.)

11. Liberal Democrats now make up a clear majority of their party ​and view universal healthcare, greater abortion access and higher taxes on the rich as essential political positions, underscoring how Democrats have moved ‌leftward in recent years, according to a new Reuters/Ipsos poll. The six-day poll, completed on Monday, showed the proportion of Democrats who label themselves as “liberal” has risen to 71% from 55% in 2012, while ​the share who see themselves as "conservative" has dwindled from 33% to 16%. Some 76% of liberal Democrats said increasing taxes on ⁠corporations and billionaires was an “essential” policy position for anyone who considers themselves a liberal, the poll found. Another 72% said the same about expanding abortion access, ​while 71% said achieving government-provided healthcare for all Americans was a necessary goal for any liberal. Insurgent left-wing candidates this year have racked up a string of ​primary victories over more centrist Democrats, many of whom were backed by the party establishment. They have gone beyond New York Mayor Zohran Mamdani's election last year in a deeply liberal city to vie for office in more politically divided states. Only ⁠16% of Democrats support military and economic support for Israel, while 57% oppose it, according to the Reuters/Ipsos poll. (Source: reuters.com)

12. Bloomberg:

Artificial intelligence models developed by OpenAI and Anthropic PBC carried out “unsanctioned” actions — including hacking a website and attempting to inject harmful code into software during safety testing — reinforcing fears that neither the creators nor seasoned researchers of these systems can predict their actions in testing.

The UK government’s AI Security Institute, established in 2023 to evaluate the safety of cutting-edge AI models, said Tuesday that both Anthropic’s Mythos 5 and OpenAI’s GPT-5.6-Sol models had both “engaged in sustained, potentially harmful activity directed at real people and organizations” during evaluations. The institute intentionally allowed the models internet access and used them without certain safety filters to test their capabilities.

“Even under test conditions, this incident is significant: It is the first time we have seen risks around autonomy and deception manifest this clearly in the real world,” the institute said in a post on the social media platform X. (Sources: bloomberg.com, aisi.gov.uk, x.com)

13. The number of U.S. student visas issued to Chinese and Indian nationals has plummeted under the Trump administration, with the global rejection rate hitting a decade high as restrictive immigration policies squeeze the pipeline of foreign academic talent. According to State Department data, the U.S. issued over a third fewer F-1 student visas to Chinese applicants in the summer of 2025 compared with the same period in 2024. Indian students saw an even sharper decline, with approvals dropping by nearly two-thirds. (Source: caixinglobal.com)

14. An invasive, malaria-carrying, insecticide-resistant mosquito that thrives in cities, where malaria has not been a major threat, has moved farther and faster across Africa than even pessimistic scientists had feared. And many public health experts believe it is too late to eliminate, or even contain, it. A new genomic analysis of the mosquito, called Anopheles stephensi, using specimens collected from 10 countries, showed that those found in Africa had genetic resistance to all of the chemicals currently used in spraying campaigns and other mosquito-control efforts, meaning those insecticides will not kill it. It is moving with terrifying efficiency and speed across flat, open, windy terrain, pushing westward to Ghana and south through Kenya, from its initial arrival on the continent in Djibouti in the Horn of Africa more than a decade ago. This mosquito alarms health experts because, unlike the species that historically spread malaria in Africa, it thrives in urban as well as rural areas, and is not deterred by dry seasons. This means that malaria, already one of the top killers in Africa, could become a grave problem in megacities such as Lagos and Kinshasa, each of which are home to about 20 million people. (Source: nytimes.com)

15. Ebola has killed more than 1,700 people in eastern Congo in what has become the fastest-growing outbreak of the disease, according to data — spreading faster than health officials can track and with patient zero still unidentified. As of Tuesday, 3,802 cases had been recorded, with 1,707 deaths, the latest government update showed. It is not clear when the outbreak will reach its peak. (Source: statnews.com)

16. Stanford researchers discovered immune cells in flatworms that explode within minutes, killing nearby bacteria and foreign cells before vanishing completely. Their unusually fast and localized attack could offer clues for developing targeted treatments against infections and cancer. (Source: sciencedaily.com)

17. A specially engineered chewing gum reduced HPV by up to 93% and nearly eliminated two bacteria linked to head and neck cancer. The treatment preserved beneficial mouth bacteria, raising hopes for a safer and more affordable therapy. More on this here. (Sources: sciencedaily.com, penntoday.upenn.edu)

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Quick Links: “Shark Week” follow-up: 12-foot ‘Sharkzilla’ lurking in NY waters. America needs a bigger plan to control its tick problem. Parts of the UK endure first ever month without any rain.

Financialization Links: How Wall Street banks enabled Jeffrey Epstein’s sex trafficking. Yen stuck at 157 as markets weigh limits of US-Japan intervention. China’s housing slump squeezes mid-tier developers. China launches global tax hunt going back decades. Trump administration refunds $100 billion in ‘liberation day’ tariffs.

Political Links: Arizona’s Democratic governor set to pick a Republican running mate. Democrats nominated a strong Senate candidate in Kansas. Unless there’s a Blue Tsunami, he’ll lose in November. State Senator Cindy Holscher, who has called for a moratorium on data centers, won the Democratic gubernatorial nomination in Kansas. She faces an uphill battle in the fall. In Missouri: Amendment #4 gets clobbered. The New York Times previews the Democratic primary for U.S. Senate in Minnesota. Democrat exits Senate race in South Dakota, clearing way for independent. India’s ruling BJP loses byelection in stronghold after Cockroach student protests. Ukraine becomes fault line in Italy’s next election. US revokes Brazil ambassador’s visa in escalation of diplomatic feud.

Science/Technology Links: Could mending damaged DNA prolong life? SpaceX’s first-ever earnings show higher revenues and huge spending. Britain will soon be Europe’s energy powerhouse. Europe can become a bioengineering powerhouse, but it will require investment and education. Shenzhen-based AI mathematician Yurii Nesterov wins top prize in applied maths. Remembering David G. Luenberger, pioneer in optimization theory. Video: Dolphin carries dead calf in what experts call grieving.

War: The Taiwan war China might choose. Projectile sinks Indian ship near Yemeni waters. Russian ballistic missiles pummelled Ukraine overnight, killing at least 15 in the capital Kyiv as each side intensified air campaigns targeting critical infrastructure and logistics centers. Kyiv’s former top commander says NATO is too outdated for Ukraine. Ukraine energy chief says infrastructure attacks will shape war’s outcome. At least a dozen states are reportedly responding to cyberattacks against local water systems.

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1. The Arctic is cooking. Across northern Russia — a region that is famously bitterly cold — temperatures this week have routinely surpassed 90 degrees Fahrenheit (32.2 degrees Celsius), adding to the mountain of broken heat records this summer has racked up so far. In recent days, the Selagoncy meteorological station, near the border of the Arctic Circle, recorded 93.0 degrees F (33.9 degrees C); another locality, Olenyok, logged 90.9 degrees F (32.7 degrees C), according to data collected by weather information service Ogimet and reported by climatologist Maximiliano Herrera. To put that in perspective, these temperatures are on par for Orlando, Fla., at this time of year. (Source: scientificamerican.com)

2. The U.S. economy keeps putting more eggs in the artificial-intelligence basket. Tech companies are spending hundreds of billions of dollars to meet AI computing needs and issuing billions of dollars of debt to help make those purchases. The rapid data-center build-out is powering construction spending, hiring and municipal revenues. Meanwhile, a stock-market rally fueled by the rise in shares of chip makers and other companies benefiting from the AI boom has led to a massive increase in household wealth. That is helping to bolster consumer spending. Combined, those factors are likely responsible for roughly one-third of the nation’s recent economic growth, according to Michael Pearce, an economist at Oxford Economics. But the strength that the economy is drawing from the AI boom is also a vulnerability: What would happen if the boom fizzled out? “It is very much an AI-driven economy right now,” said Barclays economist Jonathan Millar. “It’s hard to imagine that we would be anywhere near as resilient without that impetus.” (Source: wsj.com)

3. Google has assembled one of the largest infrastructure financing programs in history to supply more than $150 billion of artificial intelligence chips to Anthropic. Surging demand from Anthropic, in which Google is an investor, has led the Big Tech company to orchestrate a sprawling operation to supply its chips to the start-up, according to people involved in the project and corporate filings reviewed by the FT. The effort brings together Google, Broadcom, Apollo, Blackstone, Morgan Stanley and a slew of crypto miners in a web of transactions that stretches from chip manufacturing to data centre development. At the centre of the project are Google’s tensor processing units, or TPUs — AI chips it has co-developed with Broadcom since 2016. Once used largely inside Google’s own data centres, the chips have begun to be sold externally, challenging Nvidia’s dominance of the AI processor market. Google sells the systems in “pods” — server racks taller than a person that connect thousands of chips into a single computing system. “AI chips are some of the most valuable goods ever produced,” said a senior banker close to the deals. “It’s a scale like we’ve never seen before because it’s a product we’ve never seen before.” (Source: ft.com)

4. Bloomberg:

A flurry of model launches from China’s AI sector is rapidly narrowing the gap with Silicon Valley and creating what’s been described as a death zone for anyone without frontier-pushing technology or market-breaking pricing.

Alibaba Group became the latest in a parade of Chinese debuts hitting the top of global benchmarks with its Qwen3.8-Max this week, its most advanced model to date that appeared to match or exceed Anthropic PBC’s flagship Fable 5. Two weeks earlier, Moonshot AI’s Kimi K3 showed performance comparable to the priciest US options built on a much humbler budget, sparking fresh questions over the effectiveness of US chip sanctions intended to slow China’s tech ascent.

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News Items is the most valuable newsletter out there. — Peggy Noonan.

1. IBM last week said its research shows “quantum advantage”—a point at which quantum computers perform computations beyond conventional ones—and that these results can be rigorously validated. The findings, which mark a step toward practical application of the nascent technology, were published in a trio of papers by IBM and its research partners. These include the University of Chicago, Japan’s RIKEN national research institute, and the quantum computing software firms Qedma, BlueQubit and Algorithmiq. “We’re in the quantum advantage era,” said Jay Gambetta, director of IBM Research. “Scientists can trust it. Now it’s moving from people benchmarking the systems to using these for science to look at applications.” The news comes as the company races to show that its quantum computing business can be profitable. (Source: wsj.com)

2. Google DeepMind:

Today, we are introducing Gemini Robotics 2 - the intelligence layer powering the next generation of truly adaptable robots. As it takes its first literal steps, this major advance unlocks intelligent whole-body control, advanced dexterity, and multi-robot collaboration.

Gemini Robotics 2 enables robots to reason through every movement, unlocking a broad range of tasks. For example, it can enable a humanoid to walk, crouch, stretch, and manipulate objects to clean up a cluttered room. It can even team up with other robots to finish the job faster. And this profound intelligence can also run locally on-device while seamlessly adapting to entirely new robotic bodies in just a few hours. (Source: deepmind.google)

3. Alibaba Group Holding Ltd. released its biggest ever AI model, claiming performance on par with global leader Anthropic PBC in the latest Chinese breakthrough to challenge US rivals. The new Qwen3.8-Max is built on 2.4 trillion parameters and ranks higher on several benchmarks than the headline-grabbing Kimi K3 from Moonshot that was recently unveiled. Alibaba shared results showing it delivering comparable or sometimes better scores than Anthropic’s Fable 5, a cutting-edge artificial intelligence model that was temporarily put under export controls by the US due to its advanced capabilities. (Source: bloomberg.com)

4. A version of Chinese startup DeepSeek’s flagship AI model is by ‌far the least expensive to run on benchmark tests among well-known models globally and more than 100 times cheaper to run than Anthropic’s Claude Fable 5, according to a research firm. DeepSeek, which sources have said is preparing for a potential IPO, officially released its V4-Flash ​model on Friday, its latest attempt to regain momentum by doing what it is best known for - ​offering ultra-low-cost AI alternatives. San Francisco-based Artificial Analysis estimated V4-Flash's average cost at 3 cents per test, compared with 86 cents for Kimi K3 from Chinese rival Moonshot AI, $1.86 for OpenAI's GPT-5.6 Sol and $3.15 for Claude Fable 5. (Source: reuters.com)

5. The scope of cyberattacks on U.S. water systems has grown to include at least seven states and may be far wider, officials and experts warned, as the authorities raced to safeguard the nation’s water supply against an assault that increasingly appeared to be the work of Iran. While there were no indications that any water supply had been altered or made unsafe to drink, state and local officials throughout the country were on high alert for potential problems in vulnerable computers that are commonly used to monitor and adjust water quality, including chemical-treatment levels and water pressure. Minnesota first publicly reported the attacks, and now Michigan says its systems have also been targeted. The attack has little precedent, experts said, but has long been the stuff of nightmares and sensationalized Hollywood thrillers: an apparent cyberattack by a foreign power during a time of war that could, at least in theory, jeopardize the health and safety of Americans. (Source: nytimes.com)

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1. MIT Technology Review:

As of this week in Montana, any biotech company with an experimental drug has a clear path to selling it to consumers. Companies whose drugs have been through preliminary testing—sometimes in as few as 10 healthy people—can pay $12,500 to apply to a newly established review board for approval. Once its treatment is rubber-stamped, the company can set the price of the drug and sell it via experimental treatment clinics, the first of which is likely to be up and running around the end of this year.

Montana’s latest right-to-try legislation is unique. While other jurisdictions with similar laws limit access to drugs to people with terminal illness, in Montana access is theoretically available to anyone who gives informed consent and can pay. That includes people desperate for treatments for rare diseases. It also includes those who are interested in longevity and want to try out drugs pitched as preventive therapies. (Source: technologyreview.com)

2. Kim Tingley on “the new science of inflammation”:

Traditionally, we have sorted diseases into categories, separating contagious from noncontagious illnesses; acute events like strokes from chronic conditions like asthma; diseases of cell proliferation, like cancer, from diseases of cell death, like Alzheimer’s; and those that affect one organ or bodily system from those that impact another. Our medical disciplines reflect this logic, too. But we have lately realized how interconnected the body’s systems really are. More and more, researchers are starting to see things the way that Peter Libby, a professor at Harvard Medical School and a cardiologist at Mass General Brigham, put it to me: “We all study the same disease” — inflammation is involved with everything. (Sources: linkedin.com, nytimes.com. Read the whole thing.)

3. The four big hyperscalers have plowed more than $1 trillion into capital investments since their race to dominate AI began three and a half years ago, as America’s largest tech groups bet their future on the technology. Combined capital spending by Google, Amazon, Microsoft and Meta from the beginning of the AI boom in 2023 to the end of June hit $1.1 trillion, according to earnings reports from the four companies in the past two weeks. The massive expenditure is a mark of both the scale of their AI ambitions and the speed with which the US tech giants have turned from capital-light businesses into huge investors in physical infrastructure. (Source: ft.com)

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1. US borrowing costs hit the highest level since 2007 after the Federal Reserve held rates steady, underscoring fears that the central bank will not be able to contain the inflationary shock from President Donald Trump’s war in Iran. The 30-year Treasury yield rose as much as 0.14 percentage points to 5.23 per cent following the Fed decision on Wednesday, in the biggest jump since Trump’s “liberation day” tariff announcement in April 2025, signaling worries among investors that surging oil prices triggered by the Middle East conflict could prompt a lasting bout of inflation. The yield remained elevated on Thursday morning at about 5.22 per cent. (Source: ft.com)

2. American forces began launching strikes against Iran on Wednesday night, in what the U.S. military called a “powerful response” to Iran’s Tuesday missile attacks on U.S. forces in Jordan. The strikes came hours after President Trump vowed to retaliate for the surprise ballistic missile strike, dashing hopes for an imminent diplomatic breakthrough. Though the assault was larger in scope than previous U.S. attacks, it didn’t amount to a return to major combat operations, according to a U.S. official. U.S. forces carried out a “heavy wave” of strikes, attacking dozens of targets, including military command centers, missile and drone facilities, coastal surveillance and defense sites, and maritime capabilities, said U.S. Central Command after the strikes were completed. (Source: wsj.com)

3. Eurointelligence:

(T)he Houthis are reportedly considering a toll system for the strait (of Bab el-Mandeb). This is according to the information minister of Yemen’s internationally recognized government, which does not control the capital, Sana’a, or the densely populated surrounding areas of north-east Yemen. The minister went on to say that Iran’s Revolutionary Guards are advising the Houthis on how to proceed with this plan.

Of course, we will have to see if the Houthis actually follow through later. But given the fact that they have already tried to use their position along the strait for broader geopolitical objectives, this wouldn’t be surprising. They have already interdicted shipping to try and force Israel to relent over Gaza, and are now attempting to blockade Saudi Arabia to assist Iran. Why not set up a toll system, like their allies are trying to do? (Source: eurointelligence.com)

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When European fans came to America to cheer on their teams …

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1. Dwight Garner reviews Annie Jacobsen’s new book, which you probably won’t want to read:

In a sobering new book, Annie Jacobsen considers the potentially civilization-ending impacts of biological war. Jacobsen’s new book, “Biological War: A Scenario,” is a heavily researched book about contagious and potentially civilization-ending pathogens. Though banned by international treaty, these germs have been weaponized and hoarded by countries that include Russia, North Korea and Syria. By “weaponized” I don’t mean merely that they’ve been placed at the business end of ballistic missiles. I mean that these pathogens have been genetically engineered, in diabolical ways, to trick first responders and be all but untreatable. Even a small accidental spill, like wine sloshing out of glass, like Covid slipping out of a lab, could be the last mistake our species makes. Jacobsen has interviewed everyone, from former high-ranking members of the military, the C.I.A., FEMA and NATO to former secretaries of defense, counterterrorism experts, epidemiologists and Sam [expletive] Altman. That so many were willing to talk to her, and have their names affixed to this book, indicates the esteem in which she is held, especially after the publication of “Nuclear War: A Scenario” (2024), a best seller that stirred new interest in nuclear policy, technology and risks worldwide. The reason “Biological War,” like Jacobsen’s previous book, is so consuming is that she packs a lot of dense and particulate information into a ticking-clock scenario: into a story. It’s more pulverizing than a Kathryn Bigelow movie. Some of the chapter headings are phrases like “Day Two” or “Day Three.” Not to ruin your mood, but “Day Six” is about as far as civilization gets. (Sources: nytimes.com, penguinrandomhouse.com)

2. Iran launched a surprise ballistic-missile attack on American forces in Jordan, a U.S. official said, a violent escalation that piles new pressure on President Trump to renew the war in earnest. The missiles were all successfully intercepted, the U.S. military said. But the assault raised the prospect that American forces would have to respond, just as negotiations to reopen the Strait of Hormuz and eventually jump-start broader peace talks were picking up speed. The assault marked a shift for Iran, which until now had generally fired on U.S. forces in retaliation for American airstrikes on its own territory. With the unprompted missile attack, Iran showed it is willing to take the fight to the U.S. on its own terms in an attempt to force Trump’s hand. (Source: wsj.com)

3. Iran-backed militias in Iraq fired drones at oil facilities in Saudi Arabia’s Eastern Region for the second day in a row, piling pressure on the kingdom, which is grappling with a maritime blockade limiting its crude oil shipments. The Saudi Defense Ministry said it had intercepted the drones on Tuesday, without clarifying whether the facilities were damaged. Similar attacks were carried out from Iraq on Riyadh and the Eastern Region on Monday. (Source: bloomberg.com)

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1. Michael LePage:

I think we will look back at 2026 as a landmark in medicine, the year in which the first protac drug was approved. What’s special about protacs? Well, while most drugs simply block their targets, protacs utterly demolish them. Per molecule, protacs are far more potent, and they can also do things other drugs just can’t. To put it in sporting terms, existing drugs tackle their opponents one-on-one, and sometimes that opponent evades them. Protacs are like a referee who red-cards an entire team, taking them off the field altogether. (Source: newscientist.com)

2. Gallup Poll:

Americans' approval of the job the U.S. Supreme Court is doing has fallen to a record low of 33%, driven by a steep drop in Republicans’ backing of the court since last year. The prior low approval rating was 39% measured a year ago.

Corresponding with the drop in approval, disapproval of the court has climbed to a record high 61% in the July 1-19 Gallup poll, conducted just after the end of the 2025-2026 Supreme Court term.

Sixty-two percent of Americans approved of the job the Supreme Court was doing in Gallup’s initial 2000 reading, and majorities typically approved of the job the court was doing through 2010. (Source: news.gallup.com)

3. Just one in three Americans support the war on Iran, the lowest reading in a Reuters/Ipsos poll since the five-month-old conflict’s early days, with ​most respondents saying that President Donald Trump has failed to explain his goals. The poll, conducted Friday through Sunday, also showed the Republican president’s approval rating ticking higher to ‌37%, up three points from last month when his rating tied the lowest of his presidency. Trump has offered shifting objectives for the conflict such as aiding Iranians to topple their leaders, taking out Iran’s ballistic-missile capabilities and preventing it from obtaining a nuclear weapon. The poll found that 69% of Americans — including four in 10 Republicans - think Trump has not “clearly explained the goals of U.S. military involvement in Iran.” (Source: reuters.com)

4. CSIS.org:

Deterrence is ineffective when adversaries—such as the People’s Republic of China (PRC), Russia, Iran, and North Korea—know the United States cannot sustain a long war. Low munitions stockpiles and constrained industrial capacity change the time horizon adversaries use to assess U.S. staying power and weaken U.S. capability, credibility, and communication. Capacity therefore acts as a fourth deterrence variable by making U.S. combat power more replenishable, repairable, and resilient over time. There is a deterrence problem at the core of U.S. efforts to revitalize the defense industrial base. Recent conflicts are consuming high-end strike munitions and air-defense interceptors faster than the current defense industrial base can replace them. At the same time, these capabilities are key to conventional deterrence and changing how adversaries assess the costs and benefits of launching major wars short of nuclear exchange. Worse still, major rivals including the PRC, Russia, and North Korea are all at or near a wartime footing, producing and stockpiling munitions for future contingencies. Even Iran has proven capable of sustaining the production of ballistic missiles despite sustained attacks by the United States and Israel. As a result, in a major regional conflict, U.S. use of munitions would likely exceed current stockpiles, with some long-range precision-guided munitions potentially exhausted in less than a week in a Taiwan Strait conflict. (Source: csis.org)

5. President Trump set the stage for his first meeting with Benjamin Netanyahu in months by declaring that Israel “wouldn’t survive” without the US and playing down concerns about selling F-35s to Turkey. The US president’s remarks came on the eve of his meeting in Washington with the Israeli premier on Tuesday, the first since the two men launched the war on Iran earlier this year. The meeting comes as US and Israeli interests in the Middle East have appeared to diverge, with Trump announcing a ceasefire between the US and Iran in April — before Israel had achieved any of its war goals. (Source: ft.com)

6. The Kremlin has initiated a new crackdown on anti-war voices ahead of Russia’s parliamentary elections in September, barring candidates from running if they show any sign of opposing the bloody, expensive and increasingly unpopular military operation in Ukraine. While repression of political opposition forces is nothing new in President Vladimir Putin’s Russia, the new clampdown is jarring because for a moment this spring, it seemed like a rare window had opened for dissent, as the authorities appeared to create a pressure release valve for growing dissatisfaction over the war. But with the government coming under increasing pressure over Ukraine’s relentless drone strikes and the growing toll on the economy, including an acute fuel crisis, hard-liners in the Kremlin and the security services are gaining the upper hand and have pushed successfully for more repressive measures. (Source: washingtonpost.com)

A News Items Mini-Feature: Subscribers sometimes ask, what newsletters do you read? “A lot of them” is the immediate answer. One of the very best is Liz Hoffman’s “Semafor Business”. It’s well-reported, well-written and well-informed. Added bonus: it’s free. We’ll recommend others as we go along. There are a lot of good ones.

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1. Moonshot AI is poised to make its Kimi K3 model available for public download, expanding its reach and influence in the global open software community at a time of growing US concern about Chinese encroachment into the top echelons of AI development. The Beijing-based company is due on Monday to release the model’s weights, which are used to steer artificial intelligence systems toward answers. That will enable developers to download, tweak and host the technology freely in a move to broaden the user base of Moonshot’s AI. Founder Yang Zhilin has said he wants to win users by focusing on openness and greater availability than competing US proprietary systems. (Source: bloomberg.com)

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1. Scientists have exploited a peculiar CRISPR enzyme so that it fights cancer by shredding the DNA in cancer cells, causing them to self-destruct. The enzyme can be programmed to recognize a specific messenger RNA, such as one made by a cancer cell. Once the enzyme finds its partner, it slashes the cell’s genome to pieces. The DNA-shredding approach, reported in two papers in Nature^1,2, could provide a way for researchers to kill cancer cells that express ‘undruggable’ mutant proteins that have been difficult to target using conventional medicines. “It’s a molecular kill switch that recognizes a particular RNA,” says Yang Liu, a molecular biologist at the University of Utah School of Medicine in Salt Lake City, and an author of one of the papers. “This is basically a programmable chemotherapy.” (Source: nature.com. Research papers are here and here.)

2. Inhaling high levels of carbon dioxide intermittently for half an hour flushes proteins linked to Alzheimer’s disease out of the brain, a small study has found. Exposure to the gas changes how blood vessels in the brain constrict and dilate while we’re awake, mimicking activity that occurs during deep sleep. This then turbocharges the glymphatic system to remove the build-up of waste products that could cause harm. A 2025 study suggests the same approach could help with Parkinson’s disease, by clearing the protein alpha-synuclein. “If you have any condition that is due to or exacerbated by any sort of accumulation of waste, this could be something beneficial,” says Sephira Ryman at The University of New Mexico, Albuquerque. (Sources: newscientist.com, pmc.ncbi.nlm.nih.gov, hcs.unm.edu)

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By Stephen Klein, contributor. This is his first “column” for News Items.

We have been told that the defining battle in generative AI is the United States versus China. I am no longer convinced that is the most useful way to understand it. The defining battle will not be intelligence versus intelligence. It will be intelligence divided by cost. And if we wanted to have a little fun with it, we might say the contest is not really Washington versus Beijing at all. It is Mira Murati versus the DeepSeek playbook.

Ms. Murati matters because she represents a smarter possible American response: not building the largest and most expensive intelligence possible, but designing intelligence around customization, efficiency and economic usefulness. To see why, we need to acknowledge something Silicon Valley would rather not admit: large language models are becoming commodities.

Commodities do not have to be identical, only substitutable enough that buyers can compare them and switch. That is already happening. Developers swap one model for another. Companies route different tasks to different models. Open-weight systems are customized and deployed privately. DeepSeek has even made its API compatible with the formats used by OpenAI and Anthropic, deliberately reducing the friction of switching. Once several products can produce a sufficiently good result, price becomes decisive. The frontier models may be the most powerful commodities ever created. They may also be the most expensive commodities in human history.

For years, American frontier laboratories have competed through scale: larger models, more compute, more expensive talent, extraordinary capital. The strategy worked brilliantly, and has created an economic trap. Each breakthrough compels financing the next before competitors catch up. OpenAI reportedly expects to spend roughly $600 billion on computing through 2030; its inference costs reportedly quadrupled during 2025, pushing adjusted gross margin from 40 percent down to 33. Revenue growth remains remarkable. But revenue does not answer the underlying question: can the cost of producing and delivering frontier intelligence fall fast enough to generate sustainable returns while cheaper competitors close the performance gap?

China, partly through necessity has been asking a different question: how much intelligence can we produce, and at what cost? Chip restrictions forced Chinese developers toward architecture and efficiency. DeepSeek’s mixture-of-experts design activates only part of the model per request. Moonshot’s new Kimi K3 contains a reported 2.8 trillion parameters but activates just 16 of its 896 experts per operation, converting compute into capability roughly 2.5 times more efficiently than its predecessor. The pricing makes it concrete: Moonshot lists K3 at $0.30 per million input tokens and $3 per million output; Anthropic lists Claude Sonnet 5 at $2 and $10, rising to $3 and $15 after August 31. The comparison is imperfect, but the direction is unmistakable. China is not merely competing to produce intelligence. It is competing to change its price.

Which brings us back to Mira Murati. On July 15, Thinking Machines Lab released its first model, Inkling, and said something no American frontier lab has been willing to say: “Inkling is not the strongest overall model available today.” That admission is the strategy. Inkling is an open-weight mixture-of-experts model, 975 billion parameters with only 41 billion active, positioned not as a champion but as an efficient foundation to be adapted with a 12-billion-active-parameter Inkling-Small coming to cut cost and latency further. Analysts rated it the most capable American open-weight model, while noting it still trails the best Chinese open models. That is not a footnote. That is the point. The efficiency race is real, it is being run at the frontier, and the United States is behind in it.

Some early evidence: In a collaboration with Bridgewater Associates, a model fine-tuned on specialized financial data scored 84.7 percent on financial reasoning benchmarks, beating the proprietary frontier models it was tested against on both accuracy and cost. The figure is self-reported, not independent. But it reveals the strategy: customize intelligence for a particular problem rather than repeatedly buying the most expensive general intelligence available. China arrived at efficiency through necessity. Murati is pursuing it by design.

Here is the uncomfortable part: the incumbents cannot easily follow her. Hundreds of billions in data-center commitments, chip contracts and energy agreements have been signed on the premise that ever-larger frontier models will command premium prices. Valuations assume it. Investors have priced it. A company that has promised the frontier cannot suddenly announce that the frontier is a commodity. A new entrant can choose efficiency by design; the giants must keep running the race they created, and keep paying for it.

The most revealing evidence may be what OpenAI and Anthropic are doing with the money: moving into implementation and consulting. OpenAI has launched the OpenAI Deployment Company with more than $4 billion in initial investment and is acquiring Tomoro, an applied-AI consulting firm with roughly 150 engineers. Anthropic has helped establish an AI services company with Blackstone, Hellman & Friedman, Goldman Sachs and others. If access to frontier intelligence were sufficient to produce valuable outcomes, the model makers would not need armies of consultants to help customers use it. Producing intelligence and creating value from intelligence are two different businesses.

The frontier laboratories have accomplished something historic. But the next race will not be won by the company that produces the most intelligence. It will be won by the company that delivers the right intelligence at the lowest sustainable cost.

Stephen Klein is the founder and CEO of curiouser.ai, a serial entrepreneur, and a part -time instructor at the University of California, Berkeley, teaching ‘Marketing in the Age of AI and AI Ethics’.

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One of these days, we’re going to start an episode of ‘Alternate Shots’ talking about something other than the Iran War. We started talking about it in Episode #16. This is Episode #32.

Iran, having been handed a windfall of concessions in the agreed Memorandum of Understanding, thinks the windfall isn’t enough. The U.S. imagines that doing the same thing over and over again (bombing) will lead to Iran’s capitulation. It won’t. Add the two together, the war escalates.

Richard talked about that in his latest Substack post, so we started there, before moving along to the Saudi-U.S. nuke deal, the performative mayor of New York City, yet another horrible Fox News Poll (horrible for President Trump, who hates the Fox News Poll), and OpenAI’s latest model’s unnerving jailbreak.

In the “Sports Section”, we talked about The Open Championship, Cam Young’s brilliant final round and the winning Kiwi who won the tournament, an epic World Cup (on and off the pitch) and the Scotsman who broke track’s equivalent of the sound barrier.

Have a listen. It’s 30 minutes long.

(‘Alternate Shots’, Episode #32. Co-hosted by Richard Haass and John Ellis. Produced by Dale Eisinger. Recorded, 23 July 2026. If you prefer, you can listen to this episode (and all previous episodes) by clicking on these hyperlinks: Apple, Amazon, and Spotify. We’re on a number of other podcast platforms as well. And YouTube!)

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