Random Thoughts #60

Random Thoughts #60

Is it just me but don’t you think that Linda McMahon looks a bit like the Joker?

Kristi Noem was hospitalized for an allergic reaction. She couldn’t possibly be allergic to false eyelashes or hair extenders could she?

The Fed’s Open Market Committee met and as I expected shot Donald Trump the bird. I thought that all the name calling and bellicosity by the president would force the Fed to tell him to go pound sand. Believe me, if the Fed had lowered rates the market would have lost faith in this Fed labeling it Trump’s puppet. Just goes to show you that if you can’t be fired by this president you can assert your independence and still keep your job.

The next Open Market Committee meets July 29-30. I bet they will lower rates (the Fed Funds target rate) then.

Trump said it again. He wants the Fed to lower interest rates to reduce the cost of the national debt. So its not about stimulating growth, is it? Here is his rant: “‘Too Late’ Jerome Powell is costing our Country Hundreds of Billions of Dollars,” Trump wrote on Truth Social. “He is truly one of the dumbest, and most destructive, people in Government, and the Fed Board is complicit. Europe has had 10 cuts, we have had none. We should be 2.5 Points lower, and save $BILLIONS on all of Biden’s Short Term Debt. We have LOW inflation! TOO LATE’s an American Disgrace!” Again, Europe is cutting rates to cope with Trump’s higher tariffs and the slowing down in their export economies. Just the opposite of the situation created by Trump here. The rise in the cost of refinancing the debt was caused by Trump’s actions which have driven up Treasury bond rates. If Trump wants the cost of the debt, which will soon be over $1 trillion, to fall then he needs to eliminate his tariffs and more importantly cut federal spending. The Fed funds rate is not the reason why $11 trillion in debt is going to have to be refinancing this year at very high rates.

Tucker Carlson certainly beclowned himself for berating Ted Cruz for not knowing the population of Iran. Why is this a relevant question? Would Cruz’ position change if they had less (or more) people? What does this have to do with Khomenei getting the bomb? I am reminded of one time when I was an expert witness that the other side tried to discredit me. The attorney asked me “What is Regulation M?” Mind you the Fed has regulations from Reg A to ZZ. When I replied that I did not know, he said “Then how can you be an expert on the Fed?” That would be similar to questioning his legal expertise if he could not cite every line of Tennessee code.

The Fed reported a loss of $224 billion for 2024. The Fed pays interest on bank reserves and on its massive holdings of government securities. Prior to the runup in its balance sheet, the Fed made a profit and returned it to the Treasury. Its losses bring up an interesting question. Since the Consumer Financial Protection Board is funded out of the Fed’s earnings, shouldn’t it be shut down if the Fed makes losses? Trump ordered the agency shut down but the courts have temporarily sustained that action.

The Supreme Court just ruled that Tennessee’s ban on gender mutilation surgery for minors is constitutional. I guess “gender affirming care” sounds more sanguine but the reality is different. The left wing press called the ruling “divisive”. CNN called the ruling “a significant blow to transgender Americans” and said that ”Transgender advocates framed the ruling as a “devastating loss,” Mind you, we are talking about minors. If an adult wants to have transgender surgery, then nothing prohibits that. My guess is that the Tennessee law was the result of disclosures that Vanderbilt Hospital was performing such surgeries on children. Recall the study in the UK showed most children with gender confusion grew out of it. The study also indicated that many children with autistic spectrum disorder had gender dysphoria. Inflicting nonreversible surgery on these children is inhumane. Of course, all the court’s liberals voted against it with Justice Sotomayor saying “The court “abandons transgender children and their families to political whims. In sadness, I dissent.” Political whims? However, the question is whether the ruling is constitutional not whimsical.

Speaking of whimsical, the president just told ICE to chill on raiding agriculture, meatpacking, hotels and restaurants. Is construction next? Regardless, look for a flood of illegals to line up for jobs in agriculture, meatpacking, hotels and restaurants. The news reports that republican representatives from Trump’s farming states pressured the White House to ease off. Trump himself tweeted “FOCUS on our crime ridden and deadly Inner Cities, and those places where Sanctuary Cities play such a big role. You don’t hear about Sanctuary Cities in our Heartland!”  He also said “Biden allowed 21 million people to come into our country. Of that, vast numbers of those people were murderers, killers, people from gangs, people from jails — they emptied their jails out into the U.S. Most of those people are in the cities, all blue cities.” Somewhat surprisingly there has not hardly been a peep of criticism from the Trump haters who are caught in a quandary. They can’t applaud Trump for easing up on his deportation of illegals when they would really love to say that he is only doing this to help the dastardly Big Agriculture continue to exploit the “migrants.”

Exports, perhaps the only source of growth in the Japanese economy, fell last month. Japan’s Prime Minister Ishiba said “The series of tariff measures taken by the U.S., which accounts for approximately a quarter of global GDP and about 20% of Japan’s exports, are damaging profits of many Japanese companies, including the auto industry.”  However, Japan’s negotiators say that they cannot reach a deal because Trump’s negotiators can’t agree among themselves. It has been reported that open disagreements and confusion among Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick and U.S. Trade Representative Jamieson Greer have made negotiations difficult – to be kind. It is said that often the three argue and debate amongst themselves while at the negotiating table with the Japanese. Trump needs them to get their act together. I still say the Japanese should threaten to dump their $1 trillion in Treasury holdings if Trump doesn’t roll their tariffs back to zero.

Would it be racist to call Trump’s insistence on Chinese tariffs “gung-ho?”