US Banks Are Growing Loans Into Deteriorating Credit and Changing the Rules to Hide It

Q4 2025 call report data is in, and the headline numbers look healthy: US bank assets grew $144.7B to $25.26 trillion, deposits surged $327.3B (largest quarterly gain since Q4 2021), and 17 of 19 loan portfolios expanded, the broadest growth since 2024.

But dig into the data from BankRegData.com and the picture gets uncomfortable fast.

Credit card balances jumped $53.3B in a single quarter (4.63% growth). Mortgage delinquencies climbed from 1.84% to 2.03%. C&I loan delinquencies hit their highest level since 2017. Wells Fargo's non-owner-occupied CRE delinquency rate is now 5.45%. Multifamily, construction, and owner-occupied CRE are all deteriorating simultaneously.

Nine loan portfolios hit all-time highs. Several of those same portfolios are seeing delinquencies rise in lockstep.

The most telling detail: banks are gaming the loan modification reporting rules. New permanent guidelines only require reporting modifications from the "last 12 months," which lets banks quietly de-designate previously modified loans. Sallie Mae's performing modifications dropped from $1.3 billion to $369 million in one quarter. Not because borrowers started paying, but because the reporting window shrank. Their Texas Ratio improved overnight on paper.

Meanwhile, 51% of big bank loan growth came from NDFIs (Nondepository Financial Institutions) and Purchase/Carry Securities, not Main Street lending. JPMorgan shed $114.65B in trading assets in a single quarter. Their trading book alone is larger than all but the Top 10 banks' total assets.

Nine of 19 portfolios at all-time highs. Delinquencies rising across residential, commercial, construction, and multifamily. And the rules just changed to make it all look cleaner than it is.

Alpha School: 2 Hours of AI Tutoring Beats 8 Hours of Traditional School

Why it matters: When AI personalizes education, students complete academics in 2 hours and score top 1%.

Joe Liemandt's Alpha School is quietly producing results that should embarrass every school district in the country. Using AI-powered, mastery-based tutoring, students complete their academics in just two hours per day and score in the top 1% on standardized tests.

The model exposes a brutal truth about traditional education: transcript grades mask massive gaps. Alpha's intake diagnostics show "A" students can be one to three grade levels behind. "B" students? Three to seven years behind. The system isn't teaching kids. It's passing them along.

Alpha fixes this by targeting instruction to actual knowledge level, not age. A full grade level typically takes just 20-30 hours to master. A student three years behind can catch up in about two months with an extra hour of daily focused work.

After two hours of academics, afternoons are spent on life skills: leadership, entrepreneurship, public speaking, financial literacy. 96% of Alpha students say they love school more than vacation. Meanwhile, the median American high school student gains approximately 1 point on a 300-point scale over four years. One point. In four years.

Simplicity Is Live on Liquid, and It Changes What's Possible on Bitcoin

Why it matters: Smart contracting language with formal verification is now live on Bitcoin infrastructure.

Blockstream's Simplicity language launched on the Liquid Network last year, and it's worth understanding why it matters. Bitcoin Script is intentionally limited. It can lock and unlock coins, but it can't do much else. That's a feature, not a bug. Simplicity means fewer attack surfaces. But it also means every new capability requires a soft fork and years of debate.

Simplicity changes the equation. It's a low-level smart contracting language built on just nine primitive operators, with formal verification baked in. You can mathematically prove your contract does what you think it does before deploying it.

On Liquid today, developers can write contracts using SimplicityHL (a Rust-like high-level language that compiles down to Simplicity), test them in a browser-based IDE, and deploy them on mainnet. The language supports features like vaults, covenants, and complex spending conditions that Bitcoin mainnet can't do yet, all without needing consensus changes on Liquid.

The longer play: if Simplicity were ever soft forked into Bitcoin itself, new features like ANYPREVOUT could be implemented without separate consensus changes. Liquid is the proving ground. It's not flashy. It won't pump anyone's bags. But it's real engineering happening on Bitcoin infrastructure -- and it's live right now.

The Epstein Files Reveal an Elite Obsession with Chemical Mind Control

Why it matters: Evidence suggests research into chemically manipulating human emotion and free will.

The DOJ's release of 3 million+ pages from the Epstein files has dominated headlines for weeks. Most of the coverage has focused on the names: who flew where, who knew what. But buried in the documents is something arguably more disturbing than the blackmail operation itself: evidence that Epstein and his network were actively researching how to chemically manipulate human emotion, attachment, and free will.

Emails between Epstein and his MIT-affiliated biohacking team reveal discussions about creating a "love cure." In the exchange, Epstein tells his team that love is essentially "turning off critical thinking." The team responds that SSRI medication, the same class of drugs prescribed to tens of millions of Americans for depression and OCD -- could be repackaged as a "love cure."

This wasn't theoretical. The files also reveal that Epstein exchanged emails with photographer Antoine Verglas about scopolamine, a drug derived from Angel's Trumpet plants that eliminates free will and wipes memory within minutes.

Phillip Frost, named in the Epstein files, served as Chairman of Teva Pharmaceuticals -- one of the world's largest producers of generic SSRIs. Over 13% of American adults are currently on antidepressants. Birth rates in the US hit record lows and continue to fall. The Epstein files don't prove a grand conspiracy. But they show that the people at the very top of the power structure were actively interested in using these exact chemical mechanisms as tools of control.

Bitcoin's Long-Term Holders Flash Capitulation Signal

Why it matters: Strongest hands are selling at a loss for first time since May 2022.

Glassnode flagged a rare event this week: the 7-day EMA of the Long-Term Holder Spent Output Profit Ratio (SOPR) dropped below 1 for the first time since May 2022. That means Bitcoin's strongest hands, holders who've sat through every dip for 155+ days, are now selling at a loss.

February 6's dip to $62,800 imposed overhead pressure on long-term holders comparable to the LUNA crash. Glassnode called it a "rare shift in conviction typically seen in deeper stages of bear markets." LTH net position dropped by 245,000 BTC in recent weeks.

Historically, LTH capitulation has marked cycle bottoms as forced wealth transfers create buying opportunities. Glassnode points to $54,000 as the next critical support if selling pressure continues. But FalconX's Sean McNulty argues $60,000 will hold, citing "a massive wall of buyers who recently absorbed the capitulation of short-term holders." The signal isn't that the sky is falling. It's that even the most patient holders are feeling real pain for the first time this cycle -- and that's typically when the best buying opportunities emerge.

Strategy Adds Another 2,486 BTC

Why it matters: Saylor continues accumulating as BTC trades below estimated production cost.

Michael Saylor's Strategy announced another purchase of 2,486 BTC (~$169M), bringing total holdings near 720,000 BTC. The buy comes as BTC trades below JPMorgan's estimated $77K production cost.