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Hey everyone,

Welcome to The Under Report, your weekly intelligence brief about the stories that move the world without making headlines.

I'm currently in Belgrade Serbia sitting in an international hotel between the Nikola Tesla museum and NATO bombing sites. The facades of the buildings are Austro-Hungarian, the construction is Yugoslavian, there's a Hard Rock Cafe at the historic core, and for some reason, every Serbian I speak to mentions the UFC. (I think Dana White just visited here).

Here's what I am trying to get at: history is never done.

Every interaction that you have throughout your day is handed down to you through a series of small miracles of innovation, catastrophic tragedies, and turns of fate. Sometimes it looks like a crater in the middle of a city, other times it looks like a Hard Rock Cafe.

Let's get to it,

Eric

P.S. Don't forget that Tuareg Blues exists. Remember we study geopolitics to understand how the world works not to watch it fall apart. Humanity makes some cool things.

Bottom Line Up Front (BLUF)

Washington is trying to sanction its way out of the Iran war. Trump declared an Economic D-Day and Bessent promised the toughest sanctions in history, days after we learned the Navy lost its main Gulf logistics hub. The UAE cut Iran off before they even asked.

Israel bombed a Syrian runway to send Turkey a message. Eight bombs hit Abu al-Duhur airbase, which Netanyahu says was about to host Turkish troops. The US envoy found out afterward and called it an unnecessary escalation.

Trump shrank the Korea war games and Kim answered with ten missiles. The barrage came a day after Pyongyang brushed off his outreach. Washington and Seoul disagree on the size of Kim's arsenal.

Somebody keeps sending thousands of people swimming toward Spain. Social media groups with over 400,000 members called a second mass crossing at Ceuta, and Morocco crushed the wave it made no move against in July. Rabat says the calls are of unknown origin.

Brazil's election is now the main event in Washington's South America push. Lula opened his campaign on sovereignty while US troops settle in next door in Paraguay. The polls have the race inside the margin of error.

What happened?

The US is fighting with sanctions because it’s out of bases.

Trump declared an "ECONOMIC D-DAY" on Truth Social Wednesday, promising penalties on any country giving Iran "any type of lifeline." Treasury Secretary Bessent followed Thursday, telling CNBC the US will impose the toughest sanctions in history and "collapse this regime.” The memorandum of understanding expired Monday, Tehran says the Strait of Hormuz stays closed until the blockade lifts.

We need to background this with an important fact.

The New York Times reported August 15 that Iranian missiles and drones destroyed much of the Navy's Bahrain logistics hub in the war's opening days, pushing resupply 2,200 miles out to Diego Garcia. Here's the simple version: the US can't support long term military operations so its trying the economic path.

The UAE fell in line immediately. Abu Dhabi suspended all trade and financial transactions with Iran.The UAE ranks second among Iran's major trading partners just behind China.

Why does it matter?

Trump has said 50 years of economic pressure failed to stop Iran's nuclear program but now the US is trying sanctions again again. Unfortunately the costs fall on civilians first: inflation above 40 percent, and Iran's welfare ministry reports 57 percent of Iranians experiencing malnourishment. But, will it work?

The answer is no. The IRGC was designed to operate like a hedge fund with a logistics wing and highly trained military force. Compartmentalization has been key to Iranian success in all respects and weakening the economy will make it harder for the citizens to rise up while also making the regime more powerful.

What we're watching for:

What happened?

An airfield in Syria got blown up to make a point.

Israel struck the Abu al-Duhur airbase in Syria's Idlib province overnight August 17 to 18. Syrian state television counted eight strikes, with no casualties, and Airbus satellite imagery shows craters on the runway. Netanyahu's office said Syria was on the verge of breaching the security status quo by letting Turkish troops deploy there. Turkey's defense ministry denies any delegation was at the base; Syria's foreign minister acknowledged Turkish officers visited for training.

Why does it matter?

Turkey and Israel cannot fight one another directly. Turkey is a NATO country and Israel has reached a similar mutual protection status with the United States. However, Israel's goals of establishing buffer zones in Syria and projecting power into the greater Middle East run contrary to Turkish regional dominance.

So, since they can't fight directly, they're going to use Syria as a battle ground. This means hitting joint Syrian and Turkish infrastructure. It also means that Israel will operate through its proxies in the Druze and Kurdish communities. Meanwhile, Turkey will continue to embolden the regime in Damascus to reassert full territorial control, including those areas held by Israel.

What we're watching for: