Last week’s annual gathering of central bankers and other big shots at Jackson Hole WY produced further declarations that the U.S. banking system is strong and that current policies need to be left in place. The latter message was intended for President Trump, who has ordered a review of 2010 Wall Street reforms.
As far as the big banks are concerned, why should anyone cheer their ability to pay big bonuses, when 58% of Americans are living paycheck-to-paycheck? If one assumes that central bankers are not as stupid as they appear, the only other logical conclusion is that the Federal Reserve is continuing to follow the playbook provided by globalists in their attempt to dismantle the U.S. economy.
Another Fed “twist” is speculation that Trump has Goldman-Sachs’ Gary Cohn in the on-deck circle to replace Yellen – IF he can convince Congress to restore Glass-Steagall walls that separated Relationship Banking from Transactional Banking from 1933 to 1999. G-S would like that, because they have never done Relationship Banking. It would put Citibank, Bank of America, etc. back into a Relationship-only box.
On the issue of Fed credibility: following in the footsteps of Alan Greenspan, who confirmed after leaving office his full support for a gold standard, Ben Bernanke (who criticized cryptocurrencies while in office) was just confirmed as keynote speaker at an October blockchain and banking conference.
No need for an ACA penalty! According to the Washington Free Beacon, 4 million Americans paid $2.8 billion in penalties for the 2016 tax year, for their refusal to signup for an Obamacare policy. There is no need to pay penalties! On his first day in office, the President signed an executive order allowing individuals to opt out of coverage without overtly declaring it.
Another option was identified in 2015 by a Forbes writer: all a non-participant has to do is under-withhold on tax payments. The ONLY way the IRS has under ACA rules to collect a penalty is from a taxpayer’s refund. No jail time, no liens on property, no levies on wages or accounts. Case closed.
Transgender individuals will no longer be allowed to enlist in U.S. military forces, and those currently serving could be removed at the discretion of the Secretary of Defense. The principal reason for this decision is to “focus on decisive and overwhelming victory” and “not be burdened with the tremendous medical costs and disruption that transgender in the military entails.”
Arizona sheriff Joe Arpaio won a Presidential pardon—from a July 2017 conviction for violating a federal judge’s order to NOT detain suspected illegal immigrants. What the 85-year old legendary fighter of illegal immigration and early Trump supporter actually received was a “commutation” of his sentence (pardons are much more complicated). That it was the right move was quickly demonstrated by nasty remarks from John McCain. Is there now perhaps a glimmer of hope for pardons for Edward Snowden and Julian Assange?
Ratings are booming for the feel-good Hallmark TV channel, where one does not find sex or gore. Starting October 27, it will start running a Countdown to Christmas, with 21 original movies that all have a holiday theme.
MARKETS – for the week ending August 25
Real money: 21-thousand gold contracts were dumped on the market after gold punched through $1300. But gold and silver finished the week up anyway, $6 and 5-cents to $1297.20/oz and $17.05/oz.
US stocks bounced: the Dow 0.6% to 21814 and the S&P 0.7% to 2443.
Mining stocks (the XAU Index) climbed 2.3% to 88.52.
Crude oil (the WTIC Index) slid 80 cents to $47.87/barrel, as U.S. shale production hit 15-month highs—despite stabilization of the number of deployed drilling rigs.
Commodities (GCC Index) were unchanged at 18.59.
Currencies. The Federal Reserve Note (= dollar, via USD Index) fell 0.7% to 92.68.
Cryptocurrencies. Bitcoin (BTC) crept $70 higher last week to close Friday at $4335. The NY Times reported that identity thieves are going after virtual currency held on cellphones—hijacking from those foolish enough to keep accounts on the most easily hacked device.
US Treasury bonds kept climbing, as 10-year and 30-year yields fell 2 and 3 more basis points to 2.17% and 2.75%.
Our next weekly blog will be on September 11, with the September Transformation Watch newsletter going out to subscribers the week of September 4.
About the Author
Wayne Peterson has been publisher of the Transformation Watch newsletter since 2005. For free weekly receipt of these financial blogs, subscribe here.
Peterson’s book, “But What If I’m Right?”, outlines the factors contributing to the impending global financial transformation and provides readers with recommendations to safeguard their families and their assets.