Crisis of the day

Blue Owl

That’s the name of the New York-listed alternative asset manager that’s now restricted investors from exiting one of its funds, fuelling fears of a private credit bubble. But some analysts are taking comfort that Blue Owl also just sold $1.4B in loan assets at 99.7% of their stated value.

Winds of war

The weekend is rolling around, which in recent times has meant one of two things: a) Sabrina Carpenter is about to unveil her latest brand collab, or b) the US is about to launch its latest daring military operation.

As much as we’re keen to explore Sabrina’s Pringle-scented Redken hair mist and Dunkin’ x Prada fragrance line, the US-Iran temperature has spiked so we really need to focus.

But first to quickly and casually recap, the regime is now looking wobblier than ever after…

• a) Israel degraded decades of Iran’s proxy strategy in ~13 months

• b) the US and Israel hit Iran’s key air defences and nuclear sites in a night, and

• c) a mix of corruption, incompetence, autocracy, drought, and sanctions then triggered an economic collapse and historic street protests, until a desperate crackdown left up to (nobody knows) 30,000 people dead.

And with the world now watching, Trump 2.0 still says he sees Iran as a “continuing unusual and extraordinary threat to the United States”. Why?

Beyond the above and below, consider this: North Korea’s example suggests you can be the weirdest, wackiest, most brutal, corrupt, and incompetent excuse for a regime, but if you can sneak your way to nuclear power status, you’re untouchable.

Enter Trump’s ‘good cop, unpredictable cop’ strategy. 

Trump 2.0 continues to pursue talks, both direct and indirect. But while the latest Geneva round concluded with more vague references to “progress”, some big differences remain.

It depends which leak you want to believe, but basically the US is demanding Iran…

• end its uranium enrichment

• end its support for armed proxies (Hamas, Hezbollah, Houthis etc), and 

• tone down its ballistic missile program (range, quantity, etc).

And yet while the precise message changes from day to day, Iran’s mullahs basically see the above ultimatum as unacceptable. Why?

Consider the inverse of our North Korea example above:

• Gaddafi’s Libya suggests you can be every bit as wacky and brutal and corrupt, but ditch your WMDs and you end up dead in a ditch, while…

• Ukraine shows you can instead pursue the Western dream of freedom and jet skis, but give up those nukes (as Kyiv did in the 1990s) and you still end up fighting for your life because of some dictator next door.

So fundamentally, the mullahs will see this all as regime survival: acquiesce to those demands, and the clock starts ticking via emboldened foes, whether at home or abroad.

See how easy it is to arrive at a stalemate?

So in parallel, President Trump has dialled up the pressure to force a breakthrough via…

• the biggest US military footprint in the region since the 2003 invasion of Iraq

• a demonstrated willingness to pull the trigger (cf Maduro, Iran 2025), plus

• warnings that “really bad things” will happen if there’s no deal within 10-15 days.

So, what’s next? 

Whether it’s calculated info-war or just actual facts, there are more and more signs pointing to some kind of attack being imminent, whether…

• multiple US outlets reporting the Pentagon will be ready by tomorrow (Saturday)

• Poland’s own Donald (Tusk) issuing a chilling warning for his citizens to get out, or

• The Wall Street Journal spelling out that Trump is now picking from a menu of limited strike options to force a deal before going harder if Iran still refuses.

If something does happen, Trump’s recent practice suggests it’d be after markets close for the weekend. Oh, and speaking of markets, Brent crude prices are up ~6% this week alone, now hovering near six-month highs as traders glimpse something coming.

Intrigue’s Take

You might’ve heard the name Gérard Araud. He’s a retired senior French diplomat who’s made more headlines than most, whether via his interesting 2018 exchange with night-show host Trevor Noah, or his comparison of Trump 1.0 to Louis XIV, or his ambassadorial farewell from Washington, lamenting that the US capital was full of awful jeans (lol).

Anyway, all that by way of throat-clearing to highlight a point Araud made about Iran this week: “whatever their religious rhetoric, their final decision is always geopolitical based on a shrewd assessment of the balance of power.”

It reminds us of the kind of ‘strategic empathy’ we were always taught to practice in the foreign service: to be clear, it’s got nothing to do with sympathising with these dictators. Rather, it’s about developing sharper insights by trying to understand how they see the world, why they see it that way, and how it shapes what comes next.

And for the reasons we’ve explored above, this standoff is shaping up as existential for the regime. The one narrow off-ramp we see might resemble a tougher version of the Obama-era JCPOA nuclear deal that Trump 1.0 axed: that deal worked in the sense that Iran’s uranium enrichment plummeted, but it also didn’t work in the sense it unblocked cash that fuelled the regime’s proxy strategy across the region, contributing to everything from the Israel-Hamas war to the strangling of Red Sea maritime traffic.

So for Iran to take that offramp, any deal might need to just mothball (not destroy) its nuclear program. And for Trump to take it, the offramp would need to be tougher than the Obama-era deal he’s spent years dunking on, across enrichment, proxies, and ballistics.

The Venn diagram between those two positions is tiny, but it’s there. But assuming these two foes can’t find it? War.

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Meanwhile, elsewhere…

Extra Intrigue

Weekend reccs from Team Intrigue

• Watch: The Olympic closing ceremony (tragic!) this Sunday at 8PM CET — that’s 11am in LA, 2pm in New York, 7pm in London, or 6am Monday in Sydney.

• Binge: The acclaimed second season of The Artful Dodger on Disney+ and Hulu, created by fellow Intriguer, James McNamara.

• Register: For the online panel that Intrigue co-founder Helen is moderating at the Institute for Global Negotiation’s annual conference next week.

From our friends

Not just another TL;DR news digest. 

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Map of the day

Step into the National Museum of Korea this month and you’ll find a 19th-century flex of sheer cartographic swagger unfurled across the gallery wall.

The Daedongyeojido (above) is a 6.7-metre-tall, 3.8-metre-wide map of the Korean Peninsula, stitched together from 22 sections by geographer Gim Jeong-ho in 1861. It helped the ruling Joseon dynasty grapple with governance issues like taxation, while also offering the kingdom a sense of territorial identity. Huge ass map.

Friday Quiz

Tomorrow (Saturday) is International Mother Language Day.