August 21
BTC at $76,740 on Friday at 2:27
Oil at $86.94
Trump To Flood US With 300,000 Tons Of Tariff-Free Ground Beef Ahead Of Midterms | Zero
Next Week: The Warsh Speech at Jackson Hole
Data: Personal income and spending, PCE prices, durable goods, and the annual revision to NFP
After the Treasury buyback announcement, the Warsh speech could actually be a market-moving event
The outlook on global interest rates and long-term sovereign yields will remain in the market's forefront as investors grapple with elevated energy prices, increasing deficit spending, and soaring corporate credit issuance. Also, earnings by Nvidia will remain a bellwether for global AI demand in a period that sees ambitious outlooks clash against some skepticism of overspending on infrastructure.
Brent oil was little changed around $94 a barrel on Friday, as investors assessed signs that Iran may be seeking an end to the conflict with the US. Iranian President Masoud Pezeshkian said Tehran would prefer to conclude the war while it remains in a position of strength, describing the existing memorandum with Washington as a victory for Iran. The comments provided some relief after Treasury Secretary Scott Bessent said the US would impose its toughest-ever sanctions on Tehran and intensify economic pressure on the Iranian regime.
Relentless Russian Strikes - Kyiv Ballistic Devastation | Danube Interdiction at Reni
Mass Casualties As Russian Drones Slam Into Mall In Zelensky's Hometown | Zero
Ukraine's own deadly long-range attacks deep inside Russian territory have continued, meanwhile.
Iran
Iran crude loadings plunge to one-seventh of pre-war level as blockade bites
Trump reposts message saying Iran was given ‘every possible chance’
Ship crossings through the Strait of Hormuz fell to seven on Thursday
AlJaz
US allies in Asia wary as Trump moves military assets for Iran war
Mkts 2Y 10Y 30Y
News
Services Sector Survey Surge Sparks US Growth Rebound Hopes In August | Zero
Trump approval falls to 42% | Ras
China has firmly rejected call to join in implementing US sanctions to "squash" Iran's economy | Zero
China calls for Iran-US dialogue amid sanctions threat; Israel hits Lebanon | AlJaz
"Economic D-Day" Won’t Work. China and BRICS in the Way. Limits of Secondary Sanctions | RusTruth
Diesel is up again: $5.576 vs $5.142 a month ago
Gasoline is $4.109 vs $4.019 a month ago
Marc
Late yesterday Bessent indicated the administration will announce a new fiscal initiative to address the higher yields. This appears to have fueled dollar losses today. It does not appear to include plans to reduce the deficit, which may be around 6% of GDP this year. The US 2-10-year yield curve is twice as steep as it was before Kevin Warsh chaired his first FOMC meeting in mid-June.
Forex
Rate hike by year end: 23 bps (65% probability of no change at the next meeting).
What’s Really Going on with the Treasury Buybacks
Recently issued on-the-run securities account for less than four percent of Treasury debt outstanding but around 65 percent of average daily trading. The rest of the market consists largely of older bonds that trade much less frequently.
Arm
The Strait of Hormuz Is Repricing the Entire World Economy
The bond market understands what politicians refuse to see. Long-term government yields are rising across Europe, the United States, and Japan because investors are beginning to question whether governments can continue borrowing without limit. The Middle East conflict is accelerating a sovereign-debt problem that already existed.
South Korea’s economy at risk as Trump throws it under bus | Asia
The $350 billion Trump wants from Seoul equals roughly 18% of Korea’s GDP – a sum large enough to push the economy back to the brink of collapse
Remember the Names | Kunstler
Many of the political celebrities mentioned above, and probably many not-so-well-known players, must be freaking out as the waves ominously pound the beach and the summer days tick down toward the ill winds of fall.
Supporting players (potential defendants) include Susan Rice, Sally Yates, Veep Joe Biden (or “Joe Biden”), then White House aide Lisa Monaco, and CIA agent Eric Ciaramella (who wrote the actual Intel Community Assessment that jump-started the op). McCabe, Stzrok, Page, Ohr (and wife, Nellie), Rosenstein, and many FBI agents are potential defendants. Also Gina Haspel, CIA London station chief, who coordinated with the UK’s MI6 agent, Christopher Steele of the Steele Dossier. Throw in DOD-sponsored spook Stefan Halper and FBI liaison in London, Alan Kohler. After May, 2017, Christopher Wray was responsible for all FBI mischief and FISA Court irregularities (along with FISA Judge James Boasberg).
Peak Digest
Trump administration continues to adapt to the changing legal landscape. The State Department paused immigrant visa issuance for nationals of about 80 countries. The National Foundation for American Policy projects a 33%–50% reduction in legal immigration by the end of the term, which it estimates would open 19 million worker-years for Americans by 2028.
Alberta Premier Danielle Smith confirmed that if Option 2 prevails in the October 19 vote, the province will hold a binding independence referendum in spring 2027. Skeptics have described the independence push as potentially lacking majority support for full separation.
26,000 farmers have applied to transition to regenerative agriculture. Proponents state that regenerative practices rebuild soil, improve water retention, increase nutrient density, reduce chemical inputs, and expand access to markets with chemical restrictions
Debt Rattle
For centuries, Europe had to defend itself against Islamic invasions. And now they are simply sweeping in and the stupid liberals are welcoming them.”
Many analysts have pointed out that Axios has not been reliable on oil and Iran related reports, which tend to come out at sensitive moments timeline-wise, perhaps for maximum impact on markets.
Don’t Deport ‘Essential’ Haitians, Salvadorans Who Staff NY Government
Temporary immigrants are “essential” to the operation of New York’s government, Governor Kathy Hochul said.
Map of Butterfield Trail
In the 1950's we would hike into the Ozarks to a swimming hole on Lee's Creek called Skunk Hollow. The path we followed was often visible ruts made by the Butterfield wagons a hundred years earlier.
The Butterfield line was approximately 3,553 miles of trails in Arizona, Arkansas, California, Missouri, New Mexico, Oklahoma, Tennessee and Texas. Fort Smith was the connection point for the Butterfield routes leading to Memphis and St. Louis.
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