Well, that didn’t take long! Federal Reserve Chairman Jerome Powell came out and admitted that inflation is not going away – but! – he also blamed tariffs for much of the rise. So much for trying to keep his job with Trump! That’s definitely not an approved White House narrative at the moment.
Paul Kiker and I discussed this and how the Fed has been actively and knowingly creating the widest wealth gap in US history, and doing it because of some misguided sense that a wealth gap is preferable to some honest price discovery in the financial ““markets.””
Not only did we both disagree with that approach on generational moral terms, but we feel it’s merely forestalling an eventual correction that will be larger and more painful as a result of all the Fed’s efforts to keep its bubble alive and growing.
We also discussed how the equity markets are now even more severely overvalued than last month. Again.
Meanwhile – don’t look now! – but recession indicators keep piling up with the Cass freight index plunging and long-time trucking professionals saying this:
But taking up some of that private sector economic slack is the federal government deficit spending like drunken sailors.
Even if the government is ‘successful’ in blunting the depth of a recession, we’ll all still have to pay for it in terms of higher inflation down the road. Pay now or pay later, that’s the store policy.
Paul and I both prefer the truth, however painful or unpleasant it may be. Because it’s only within the truth that a successful set of life and investment strategies can be carried out.
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I love the Plutarch quote, so much to talk about but I can’t believe Chris you and Paul Kiker missed the opportunity to discuss Argentina’s eminent financial collapse happening and Trump possibly stepping in to help Melie.
If you look at the separation of the two, my incomplete understanding is that Javier Milei had announced a decision to peg the Peso to the USD, but that was done by trying to hold the two together. Short term, that’s being done within bands, but as seen by the charts hasn’t been working so well. I think the gap down at the end of the chart was after President Trump’s administration said they’d help Milei and Argentina.
This is the cause for raging views? I can think dozens of examples where weak currency like this doesnt matter for booming economy where they do right things and reforms to boost business. Weak currency is a bit of advantage for export heavy industries.
Peso has been weakening vs USD past 100 years due to their mad inflation scheme. That is modest chart for 2024-25.
Something in march happened to make it more volatile.
I wonder are globalist “bankers” not liking Milei and trying to undermine currency? They often do that to governments they hate.
Smart guy like Milei can make things better for people if majority support him. Argentina has lots of advantages in economy. I can only think fraudulent globalists or socialists lie and attempt nostalgia thing to get back to power… “back to” so called good days. Old people love this kind of rhetoric.
US foreign policy benefits from bancrupt socialist policies coz then money is worth less and economy is struggling, making export products cheap and government desperate to get US companies working there. This has been democrat playbook, have some weak liberal leader in coup reinstated so they just stand by while western companies come to loot resources.
The beginning of that chart where it’s smooth is when ARG had an “official exchange rate” for the USD which was wildly different from the street rate.
In other words a fiction. Everybody knew it - it was common knowledge.
Milei decided to let the markets decide and immediately devalued the ARG peso by 50% upon taking office. Next, he allowed it to crawl lower by ~2% per month and then finally, in April 2025 strict capital controls were lifted and it was allowed to ‘find itself’ within a band of 1000 to 1400 per dollar.
I think this still leaves it below the ‘street level’ but it’s a far cry more honest than anything ARG has had in many decades.
So I don’t see the chart as representing anything actually worsening for ARG, but rather an attempt to have the official statistics and exchange rates mirror reality better.
Relatedly, Milei’s economic stabilization plan has done very well at bringing down ARG’s historically out-of-control and punishing inflation rate:
Do you know how accurate that core inflation number is in argentina? Practically every western country manipulates that metric so “real inflation” in real life can be double from official numbers. If Milei can handle such stomach turning reality in metrics, 1.5% is astonishing low rate. It is way easier to build new economy from reality rather than skewed numbers.
(eg housing: show national average rate for renter or buyer which has every nook and cranny remote bad shape house skewing it down. For developers and sellers show only downtown local numbers as those are very high and majority of real estate activity and price development).
So since I’m new and haven’t Upgraded my account (Not because I don’t want to, I just have too many Subscriptions elsewhere), I’m limited to 3 replies per topic.
You said to DM you here but either I don’t know how to work this website, or the Upgrade.
To send you that video, I’d rather email you if that’s ok? uberwad@gmail.com
By the looks of some of your screenshots showing Charlie’s neck, I think you already have it though!
Naomi Klein seems to hits the nail on the head with the Neoliberal economic policies / disaster capitalism that Argentina (et al) have endured. Specifically, “economic shock therapy” (shock doctrine). I.e., transferring wealth and power from the people to global corporations.
Heard an analyst note that Argentina had 200% inflation and sits at a 60% poverty level, when just (3) years prior the level was at 10% - attributed to cutting subsidies and devaluing its currency. It’s really just more of the typical Neoliberal policy-driven crisis manufacturing, right?
BTW what was public sector jobs from total Argentina GDP before Milei?
Everyone wanted to work there for government which is bad for country.
This doesnt directly answer it but it was going up n upd government spending vs total GDP, hoovering above 40% past years… so over decade very big public spending. That’s usually not good. France has 57%. Top in EU. Or was.
