More Money, More Power

‘I do not believe in free will.’

—Albert Einstein

First, the news. Benzinga:

On Friday Tesla TSLA CEO Elon Musk issued a stark warning…In a recent podcast appearance, Musk declared, “We are 1,000% going to go bankrupt as a country and fail as a country, without AI and robots. The national debt is piling up like crazy.”

The Daily Mirror reports:

Trump economy tanks as layoffs hit highest January level since 2009

The Wall Street Journal:

US economy shed nearly 1 million job openings last year

Money Talks News:

Grocery prices just saw the largest monthly spike in 3 years

While the price of eggs has plummeted, costs for dairy, bread, and beverages continue to climb for American families.

The logic of bankruptcy is pretty simple. You spend too much for too long and people won’t lend you any more money. Unable to pay your debts on time, you declare ‘bankruptcy.’

The logic of politics, too, is fairly straightforward. People without jobs or spending power tend to be in a sour temper, preferring change to continuity.

POTUS, near the end of his career, is a continuity guy. He’s on top of the world, allowed to lecture the entire world at its most prestigious get togethers. He’s been generous with his criticism of reporters, Liberals, Conservatives, foreign governments and previous administrations…but skimpy with real reforms.

Instead, he’s favored bombastic confrontations — Greenland, tariffs, Iran, ICE, Doge — that usually get reversed, watered down…or like Doge, simply forgotten. And the big trends — the ones that are going to wreck the empire — continue:

• The firepower industry — already fat and sassy — just got the largest raise in its history…thanks to Trump.
• Deficits…rising for the previous 45 years…rise faster than ever.
• And the US hammer, never too careful about whom it whacked, finds more nails than ever. Iran, Syria, Nigeria, Venezuela, Somalia, Yemen and Iraq were bombed by the “Peace President” last year.

In our view, however, Mr. Trump is merely performing the essential work that was given to him. You might even say he’s doing God’s work – helping to bring down the US empire. He has the free will of a fence post, holding up the barbed wire of history.

God couldn’t have chosen a better guy. Trump is a ‘more’ kinda guy. More money. More ‘p***y.’ More power. Majorie Taylor Greene is right; MAGA was a lie. The only thing that could Make America Great Again is the thing that made it great in the first place — less government, fewer deficits, fewer wars, and fewer meddlesome laws and regulations.

Which brings us, in a roundabout kind of way, to Kevin Warsh. Which kinda guy is he? The former and (probably) future Fed governor was known for his “hawkish” views. He opposed increasing the Fed’s balance sheet and aimed to protect the dollar. He wanted less credit, less debt and less inflation.

These views were expressed in reaction to the 2008-2009 Wall Street bailout. Investors must have found them in the archives and dusted them off last week. For when news of Mr. Warsh’s proposed promotion to lead the Fed came out, speculators suddenly feared they were over-exposed to gold.

Gold sold off — down $400 from Wednesday to Thursday. But on Friday it was time for a second look. In order to get the job, Warsh had to shed his ‘hawk’ feathers. Bloomberg:

Donald Trump said he would have passed on Kevin Warsh as his nominee to lead the Federal Reserve if Warsh had expressed a desire to hike interest rates. “If he came in and said, ‘I want to raise it,’ he would not have gotten the job, no,” Trump said Wednesday in an NBC News interview.

The Financial Times:

Warsh says…an AI boom [will be] “the most productivity-enhancing wave of our lifetimes — past, present and future”, leaving the Fed space to cut rates without stoking inflation. The Fed nominee believes he can afford to take a chance on those productivity gains in the same way former chair Alan Greenspan did in the 1990s.

Right!

Don’t worry about inflation because AI will boost output faster than the feds increase the money supply. Right!

Like Greenspan before him, Warsh came to think what he needed to think when he needed to think it. He’s now acceptable to Trump, the Democrats, and the Deep State. He’s a ‘more’ guy, too.

Stay tuned.