Chaos & Order
@chaosorderinsight.bsky.social
Where geopolitics meets market intelligence.
Tracking the seismic shifts in water, energy, metals, and power structures—beyond the headlines.
chaosandorderinsight.substack.com
Tracking the seismic shifts in water, energy, metals, and power structures—beyond the headlines.
chaosandorderinsight.substack.com
The geographic arbitrage thesis has merit. But patience required before deployment.
Pharmaceutical business models are complex. I have stronger conviction in commodities/energy (20+ years operational experience).
Revisiting Q1 2026 after regulatory clarity. (8/8)
Pharmaceutical business models are complex. I have stronger conviction in commodities/energy (20+ years operational experience).
Revisiting Q1 2026 after regulatory clarity. (8/8)
October 31, 2025 at 10:31 AM
The geographic arbitrage thesis has merit. But patience required before deployment.
Pharmaceutical business models are complex. I have stronger conviction in commodities/energy (20+ years operational experience).
Revisiting Q1 2026 after regulatory clarity. (8/8)
Pharmaceutical business models are complex. I have stronger conviction in commodities/energy (20+ years operational experience).
Revisiting Q1 2026 after regulatory clarity. (8/8)
What would change my mind:
- BIOSECURE clarity (Q1 2026)
- AZ announces major M&A
- China revenue proves resilient
- Japanese pharma competitive positioning clarifies (7/8)
Full analysis: open.substack.com/pub/chaosand...
- BIOSECURE clarity (Q1 2026)
- AZ announces major M&A
- China revenue proves resilient
- Japanese pharma competitive positioning clarifies (7/8)
Full analysis: open.substack.com/pub/chaosand...
Chaos & Order Edition 21: The $200 Billion Patent Cliff
When patents die, companies that can buy innovation from anywhere survive. European pharma can. US pharma increasingly can’t.
open.substack.com
October 31, 2025 at 10:31 AM
What would change my mind:
- BIOSECURE clarity (Q1 2026)
- AZ announces major M&A
- China revenue proves resilient
- Japanese pharma competitive positioning clarifies (7/8)
Full analysis: open.substack.com/pub/chaosand...
- BIOSECURE clarity (Q1 2026)
- AZ announces major M&A
- China revenue proves resilient
- Japanese pharma competitive positioning clarifies (7/8)
Full analysis: open.substack.com/pub/chaosand...
So why am I not buying AstraZeneca?
1. BIOSECURE's final form unknown (House reconciliation could strengthen/weaken/kill it)
2. Timeline's longer than attractive (AI drug validation 2029-2032, not 2027-2029)
3. China pricing risk (VBP + IRA) needs deeper analysis (6/8)
1. BIOSECURE's final form unknown (House reconciliation could strengthen/weaken/kill it)
2. Timeline's longer than attractive (AI drug validation 2029-2032, not 2027-2029)
3. China pricing risk (VBP + IRA) needs deeper analysis (6/8)
October 31, 2025 at 10:31 AM
So why am I not buying AstraZeneca?
1. BIOSECURE's final form unknown (House reconciliation could strengthen/weaken/kill it)
2. Timeline's longer than attractive (AI drug validation 2029-2032, not 2027-2029)
3. China pricing risk (VBP + IRA) needs deeper analysis (6/8)
1. BIOSECURE's final form unknown (House reconciliation could strengthen/weaken/kill it)
2. Timeline's longer than attractive (AI drug validation 2029-2032, not 2027-2029)
3. China pricing risk (VBP + IRA) needs deeper analysis (6/8)
The valuation question:
AstraZeneca owns the pharma industry's largest genomic database (1.4M patient profiles, targeting 2M by 2026).
Trades at 19x earnings.
Roche has 100K profiles. Trades at 24x.
Markets value Roche's data 12x higher per profile. Justified? (5/8)
AstraZeneca owns the pharma industry's largest genomic database (1.4M patient profiles, targeting 2M by 2026).
Trades at 19x earnings.
Roche has 100K profiles. Trades at 24x.
Markets value Roche's data 12x higher per profile. Justified? (5/8)
October 31, 2025 at 10:31 AM
The valuation question:
AstraZeneca owns the pharma industry's largest genomic database (1.4M patient profiles, targeting 2M by 2026).
Trades at 19x earnings.
Roche has 100K profiles. Trades at 24x.
Markets value Roche's data 12x higher per profile. Justified? (5/8)
AstraZeneca owns the pharma industry's largest genomic database (1.4M patient profiles, targeting 2M by 2026).
Trades at 19x earnings.
Roche has 100K profiles. Trades at 24x.
Markets value Roche's data 12x higher per profile. Justified? (5/8)
European pharma (AstraZeneca, Roche, Novartis) face zero such constraints:
- No BIOSECURE restrictions
- No mRNA funding cuts ($1.3B cancelled in US)
- No embryonic research pressure
- Can partner with Chinese CROs freely
Geographic access = competitive advantage. (4/8)
- No BIOSECURE restrictions
- No mRNA funding cuts ($1.3B cancelled in US)
- No embryonic research pressure
- Can partner with Chinese CROs freely
Geographic access = competitive advantage. (4/8)
October 31, 2025 at 10:31 AM
European pharma (AstraZeneca, Roche, Novartis) face zero such constraints:
- No BIOSECURE restrictions
- No mRNA funding cuts ($1.3B cancelled in US)
- No embryonic research pressure
- Can partner with Chinese CROs freely
Geographic access = competitive advantage. (4/8)
- No BIOSECURE restrictions
- No mRNA funding cuts ($1.3B cancelled in US)
- No embryonic research pressure
- Can partner with Chinese CROs freely
Geographic access = competitive advantage. (4/8)
What makes this interesting: Novartis can source innovation globally. US competitors increasingly can't.
BIOSECURE Act (Senate passed Oct 2025) is creating a two-tier pharmaceutical system.
79% of US biopharma depends on Chinese manufacturing/discovery services that could get restricted. (3/8)
BIOSECURE Act (Senate passed Oct 2025) is creating a two-tier pharmaceutical system.
79% of US biopharma depends on Chinese manufacturing/discovery services that could get restricted. (3/8)
October 31, 2025 at 10:31 AM
What makes this interesting: Novartis can source innovation globally. US competitors increasingly can't.
BIOSECURE Act (Senate passed Oct 2025) is creating a two-tier pharmaceutical system.
79% of US biopharma depends on Chinese manufacturing/discovery services that could get restricted. (3/8)
BIOSECURE Act (Senate passed Oct 2025) is creating a two-tier pharmaceutical system.
79% of US biopharma depends on Chinese manufacturing/discovery services that could get restricted. (3/8)
Novartis just dropped $12B on Avidity Biosciences (46% premium). The deal is all about survival.
Entresto + Cosentyx = $11B annual revenue disappearing within 2 years.
"Buy biology when patents die" is now the survival rule. (2/8)
Entresto + Cosentyx = $11B annual revenue disappearing within 2 years.
"Buy biology when patents die" is now the survival rule. (2/8)
October 31, 2025 at 10:31 AM
Novartis just dropped $12B on Avidity Biosciences (46% premium). The deal is all about survival.
Entresto + Cosentyx = $11B annual revenue disappearing within 2 years.
"Buy biology when patents die" is now the survival rule. (2/8)
Entresto + Cosentyx = $11B annual revenue disappearing within 2 years.
"Buy biology when patents die" is now the survival rule. (2/8)
10/10 Full analysis of The Triple Lock, regulatory timeline (2021-2025), why competition can't fix this, and what to watch in 2026:
chaosandorderinsight.substack.com/p/why-sony-b...
US chose private franchisees. Europe chose bureaucracy.
The market has spoken.
chaosandorderinsight.substack.com/p/why-sony-b...
US chose private franchisees. Europe chose bureaucracy.
The market has spoken.
Why Sony Bank Wants to Be a Bank That Doesn’t Pay Interest
How stablecoin issuers earn 4.5% risk-free while paying customers 0%—and why competition can’t fix it
chaosandorderinsight.substack.com
October 21, 2025 at 8:42 AM
10/10 Full analysis of The Triple Lock, regulatory timeline (2021-2025), why competition can't fix this, and what to watch in 2026:
chaosandorderinsight.substack.com/p/why-sony-b...
US chose private franchisees. Europe chose bureaucracy.
The market has spoken.
chaosandorderinsight.substack.com/p/why-sony-b...
US chose private franchisees. Europe chose bureaucracy.
The market has spoken.
9/10 The $7B Treasury arbitrage is just the foundation.
Real prize: credit creation.
Stablecoins generated $670B in lending over 5 years. At 10-15% rates with 0% cost of funds, that's $67-100B potential annual revenue.
Double the Treasury arbitrage, same zero-cost capital base.
Real prize: credit creation.
Stablecoins generated $670B in lending over 5 years. At 10-15% rates with 0% cost of funds, that's $67-100B potential annual revenue.
Double the Treasury arbitrage, same zero-cost capital base.
October 21, 2025 at 8:42 AM
9/10 The $7B Treasury arbitrage is just the foundation.
Real prize: credit creation.
Stablecoins generated $670B in lending over 5 years. At 10-15% rates with 0% cost of funds, that's $67-100B potential annual revenue.
Double the Treasury arbitrage, same zero-cost capital base.
Real prize: credit creation.
Stablecoins generated $670B in lending over 5 years. At 10-15% rates with 0% cost of funds, that's $67-100B potential annual revenue.
Double the Treasury arbitrage, same zero-cost capital base.
8/10 The geopolitical layer:
$155B+ in stablecoin reserves = one of largest sources of Treasury demand outside sovereign nations.
Every international stablecoin transaction strengthens dollar dominance.
Monetary imperialism through private issuers.
$155B+ in stablecoin reserves = one of largest sources of Treasury demand outside sovereign nations.
Every international stablecoin transaction strengthens dollar dominance.
Monetary imperialism through private issuers.
October 21, 2025 at 8:42 AM
8/10 The geopolitical layer:
$155B+ in stablecoin reserves = one of largest sources of Treasury demand outside sovereign nations.
Every international stablecoin transaction strengthens dollar dominance.
Monetary imperialism through private issuers.
$155B+ in stablecoin reserves = one of largest sources of Treasury demand outside sovereign nations.
Every international stablecoin transaction strengthens dollar dominance.
Monetary imperialism through private issuers.
7/10 Usage breakdown shows why most users don't care about foregone interest:
60-70%: Traders holding for hours/days
15-20%: Cross-border payments (speed matters)
10-15%: DeFi users earning
6-10% elsewhere
10-15%: Store of value in currency-unstable countries
60-70%: Traders holding for hours/days
15-20%: Cross-border payments (speed matters)
10-15%: DeFi users earning
6-10% elsewhere
10-15%: Store of value in currency-unstable countries
October 21, 2025 at 8:42 AM
7/10 Usage breakdown shows why most users don't care about foregone interest:
60-70%: Traders holding for hours/days
15-20%: Cross-border payments (speed matters)
10-15%: DeFi users earning
6-10% elsewhere
10-15%: Store of value in currency-unstable countries
60-70%: Traders holding for hours/days
15-20%: Cross-border payments (speed matters)
10-15%: DeFi users earning
6-10% elsewhere
10-15%: Store of value in currency-unstable countries
6/10 PayPal launched PYUSD paying 3.7% to compete.
Result: <1% market share ($500M circulation vs. Tether's $120B)
Why? The Triple Lock:
🔒Regulatory prohibition
🔒 Network effects (USDT dominates 82% of trading)
🔒 Self-selected customers (value speed over yield)
Result: <1% market share ($500M circulation vs. Tether's $120B)
Why? The Triple Lock:
🔒Regulatory prohibition
🔒 Network effects (USDT dominates 82% of trading)
🔒 Self-selected customers (value speed over yield)
October 21, 2025 at 8:42 AM
6/10 PayPal launched PYUSD paying 3.7% to compete.
Result: <1% market share ($500M circulation vs. Tether's $120B)
Why? The Triple Lock:
🔒Regulatory prohibition
🔒 Network effects (USDT dominates 82% of trading)
🔒 Self-selected customers (value speed over yield)
Result: <1% market share ($500M circulation vs. Tether's $120B)
Why? The Triple Lock:
🔒Regulatory prohibition
🔒 Network effects (USDT dominates 82% of trading)
🔒 Self-selected customers (value speed over yield)
5/10 Why regulators care: If stablecoins paid interest, they'd be securities (SEC oversight kills business model)
Competitive interest would drain deposits from banks
Fed needs banks for monetary policy transmission
In this designed system, private issuers CAN'T compete on yield.
Competitive interest would drain deposits from banks
Fed needs banks for monetary policy transmission
In this designed system, private issuers CAN'T compete on yield.
October 21, 2025 at 8:42 AM
5/10 Why regulators care: If stablecoins paid interest, they'd be securities (SEC oversight kills business model)
Competitive interest would drain deposits from banks
Fed needs banks for monetary policy transmission
In this designed system, private issuers CAN'T compete on yield.
Competitive interest would drain deposits from banks
Fed needs banks for monetary policy transmission
In this designed system, private issuers CAN'T compete on yield.
4/10Here's what nobody's talking about: US law EXPLICITLY prohibits stablecoin interest payments.
The GENIUS Act (passed March 2025) defines "payment stablecoins" as instruments that "do not offer payment of yield or interest."
It's written directly into the regulatory framework.
The GENIUS Act (passed March 2025) defines "payment stablecoins" as instruments that "do not offer payment of yield or interest."
It's written directly into the regulatory framework.
October 21, 2025 at 8:42 AM
4/10Here's what nobody's talking about: US law EXPLICITLY prohibits stablecoin interest payments.
The GENIUS Act (passed March 2025) defines "payment stablecoins" as instruments that "do not offer payment of yield or interest."
It's written directly into the regulatory framework.
The GENIUS Act (passed March 2025) defines "payment stablecoins" as instruments that "do not offer payment of yield or interest."
It's written directly into the regulatory framework.
3/10 Tether and Circle already do this at scale:
- Tether: ~$120B circulation = ~$5B annual profit
- Circle: ~$35B circulation = ~$1.3B annual profit
That's more than Goldman Sachs earns from trading or JPMorgan from investment banking fees.
- Tether: ~$120B circulation = ~$5B annual profit
- Circle: ~$35B circulation = ~$1.3B annual profit
That's more than Goldman Sachs earns from trading or JPMorgan from investment banking fees.
October 21, 2025 at 8:42 AM
3/10 Tether and Circle already do this at scale:
- Tether: ~$120B circulation = ~$5B annual profit
- Circle: ~$35B circulation = ~$1.3B annual profit
That's more than Goldman Sachs earns from trading or JPMorgan from investment banking fees.
- Tether: ~$120B circulation = ~$5B annual profit
- Circle: ~$35B circulation = ~$1.3B annual profit
That's more than Goldman Sachs earns from trading or JPMorgan from investment banking fees.
2/10 Sony Bank, Stripe, and Visa are all racing to enter stablecoin issuance.
The model: Earn 4.5% on Treasury reserves, pay customers 0%, keep the spread.
At $10B scale, that's $450M annual profit for essentially accepting deposits and buying Treasuries.
The model: Earn 4.5% on Treasury reserves, pay customers 0%, keep the spread.
At $10B scale, that's $450M annual profit for essentially accepting deposits and buying Treasuries.
October 21, 2025 at 8:42 AM
2/10 Sony Bank, Stripe, and Visa are all racing to enter stablecoin issuance.
The model: Earn 4.5% on Treasury reserves, pay customers 0%, keep the spread.
At $10B scale, that's $450M annual profit for essentially accepting deposits and buying Treasuries.
The model: Earn 4.5% on Treasury reserves, pay customers 0%, keep the spread.
At $10B scale, that's $450M annual profit for essentially accepting deposits and buying Treasuries.
Position for parallel systems, not replacement: • Apollo wins (insurance solution) • Infrastructure providers win (loan admin, analytics) • BDCs get destroyed during stress • Traditional banks valuable when opacity becomes liability
Full analysis: open.substack.com/pub/chaosand... (8/8)
Full analysis: open.substack.com/pub/chaosand... (8/8)
Chaos & Order 20: Private Credit's Infrastructure Takeover
Fourth in “The New Money Architecture” series
open.substack.com
October 16, 2025 at 12:21 PM
Position for parallel systems, not replacement: • Apollo wins (insurance solution) • Infrastructure providers win (loan admin, analytics) • BDCs get destroyed during stress • Traditional banks valuable when opacity becomes liability
Full analysis: open.substack.com/pub/chaosand... (8/8)
Full analysis: open.substack.com/pub/chaosand... (8/8)
In 2020, private credit marked down 12% while liquid credit fell 35%.
Did illiquidity create resilience? Or just delay price discovery?
The test comes when central banks don't rescue the market. (7/8)
Did illiquidity create resilience? Or just delay price discovery?
The test comes when central banks don't rescue the market. (7/8)
October 16, 2025 at 12:21 PM
In 2020, private credit marked down 12% while liquid credit fell 35%.
Did illiquidity create resilience? Or just delay price discovery?
The test comes when central banks don't rescue the market. (7/8)
Did illiquidity create resilience? Or just delay price discovery?
The test comes when central banks don't rescue the market. (7/8)
Default rates tell an interesting story: • Private credit: 1.76% (Q2 2025) • Syndicated loans: 5.2%
Real outperformance? Or mark-to-model masking deterioration? We won't know until a real credit cycle hits. (6/8)
Real outperformance? Or mark-to-model masking deterioration? We won't know until a real credit cycle hits. (6/8)
October 16, 2025 at 12:21 PM
Default rates tell an interesting story: • Private credit: 1.76% (Q2 2025) • Syndicated loans: 5.2%
Real outperformance? Or mark-to-model masking deterioration? We won't know until a real credit cycle hits. (6/8)
Real outperformance? Or mark-to-model masking deterioration? We won't know until a real credit cycle hits. (6/8)
Apollo solved this. The Venerable insurance acquisition gave them $370B+ in permanent capital from insurance float.
Policyholders can't redeem. Apollo can hold through stress without forced selling.
Everyone else still has the mismatch. (5/8)
Policyholders can't redeem. Apollo can hold through stress without forced selling.
Everyone else still has the mismatch. (5/8)
October 16, 2025 at 12:21 PM
Apollo solved this. The Venerable insurance acquisition gave them $370B+ in permanent capital from insurance float.
Policyholders can't redeem. Apollo can hold through stress without forced selling.
Everyone else still has the mismatch. (5/8)
Policyholders can't redeem. Apollo can hold through stress without forced selling.
Everyone else still has the mismatch. (5/8)
But $1.7T in opaque, illiquid loans creates a fundamental problem: • Assets: 7-10 year illiquid loans • Liabilities: Investors who can redeem anytime
During stress, funds can't sell fast enough to meet redemptions. (4/8)
During stress, funds can't sell fast enough to meet redemptions. (4/8)
October 16, 2025 at 12:21 PM
But $1.7T in opaque, illiquid loans creates a fundamental problem: • Assets: 7-10 year illiquid loans • Liabilities: Investors who can redeem anytime
During stress, funds can't sell fast enough to meet redemptions. (4/8)
During stress, funds can't sell fast enough to meet redemptions. (4/8)
Basel III made middle-market lending unprofitable for banks: • Banks: 6-8% ROE after capital requirements • Private credit: 10-15% gross returns, no capital requirements
Regulation didn't just constrain banks. It created a new industry. (3/8)
Regulation didn't just constrain banks. It created a new industry. (3/8)
October 16, 2025 at 12:21 PM
Basel III made middle-market lending unprofitable for banks: • Banks: 6-8% ROE after capital requirements • Private credit: 10-15% gross returns, no capital requirements
Regulation didn't just constrain banks. It created a new industry. (3/8)
Regulation didn't just constrain banks. It created a new industry. (3/8)
Private credit built a $1.7T parallel lending system by solving problems banks couldn't: • 6-8 week decisions vs 6-12 month syndication • Flexible terms vs standardized frameworks • Single decision-maker vs committee approvals (2/8)
October 16, 2025 at 12:21 PM
Private credit built a $1.7T parallel lending system by solving problems banks couldn't: • 6-8 week decisions vs 6-12 month syndication • Flexible terms vs standardized frameworks • Single decision-maker vs committee approvals (2/8)