Authored by Ted Dabrowski and John Klingner via Wirepoints.org,

Presidential candidate and former President Donald Trump is in Chicago Tuesday for his latest campaign stop. While neither Chicago nor Illinois is in play this election, count on him to hit Chicago’s leadership hard for their many self-inflicted crises when he addresses the Economic Club of Chicago. 

Trump has been highly critical of Chicago in the past, calling crime in the city “embarrassing to us as a nation”  and “worse than some of the places…in the Middle East where you have wars going on.” He’s also decried its migrant policies: “New York City and Chicago play the Sanctuary City card, where criminals are protected…” 

His rhetoric on Chicago can often be nasty and over the top, but it’s not wrong. Too many Chicagoans experience the high-crime, low-literacy, high-tax, low-opportunity version of Chicago – which we detail below – and which Trump is likely to point at. But because it’s Trump talking, expect the media and connected class to deflect or even deny that the city’s problems exist. 

Their denials should anger many of the ordinary Chicagoans who live with the impact of these problems every day. There are the residents who feel threatened living in the nation’s long-running homicide capital – polls show nearly two-thirds of Chicagoans don’t feel safe from crime. There are the black residents who’ve made their voices heard in multiple hearings, frustrated by the attention and billions in financial and healthcare resources directed towards the city’s illegal immigrants. And there are parents who feel their children’s education is secondary to the extreme demands of the Chicago Teachers Union – one reason why 110,000 black children have fled the public school system since 2000.

Most of these problems have been inflicted by the city’s political class. They’ve stopped prosecuting many criminals. Most students aren’t taught to read or do math proficiently. Fiscal failures have the city, CPS and the regional transit authority all stuck with near one-billion-dollar deficits. And all of that mess is wrapped up in endemic political corruption, of which former Ald. Ed Burke and former House Speaker Mike Madigan are just the latest examples. 

Chicagoans’ concerns have merit, and the failures of the city’s politicians deserve to be discussed. If the Economic Club of Chicago was to have an open, honest conversation about the city with Trump, here are five key goals that should get deeper attention:

1. Start arresting, prosecuting and sentencing again. Protect victims, make crime criminal.

If not, Chicago will likely continue to lead the nation in total homicides as it has for the last 12 years. If this year’s murder trend stays on track, it will be 13 years in a row. Overall violent crime will also continue to threaten Chicagoans. Through August of this year, violent crimes were running at a six-year high, over and above the jump in violent crimes last year.

2. Bring back literacy and numeracy. Set ambitious proficiency targets, make those targets public, and then aggressively track and report progress to all Chicago parents. And begin the nation’s most ambitious school choice program. 

If not, Chicago Public Schools will continue to fail the city’s children. Just 20% of minority children at CPS are proficient in reading and they all get moved along the system, grade after grade, until they’re pushed out via graduation. It’s been happening for decades. 

The most recent years show that 70% to 80% of black students graduated from CPS, though just 10% to 15% were proficient on the SAT. It’s similar for the city’s Hispanics.

3. Obsess about economic growth and job creation. Reduce spending. Cut taxes. Tackle corruption with ethics reforms. Make Chicago attractive, affordable to job creators.

If not, Chicago will continue to suffer a poor jobs climate. Chicagoland, as recently as June, had the highest unemployment rate – 6.2% – out of all big metro areas nationwide.

For the city’s black community it’s far worse. Chicago’s black unemployment rate, at 12.3%, was the worst among the country’s biggest cities in 2023. And the poverty rate for Chicago’s black residents – 26.4% – was also the highest among big cities as well. 

4. Support and prioritize Chicago’s citizens. End the city’s sanctuary status.

If not, Chicago will continue to spend hundreds of millions on the city’s illegal migrants each year, stretching the city’s finances and making it worse for citizens most in need. It’s simply not sustainable for a city that’s one notch away from a junk credit rating, and a school district that’s already junk.

Illinois has already spent more than $2 billion dollars on “welcoming” programs, including healthcare for recent arrivals. The costs are far larger when what’s spent on all illegal immigrants is included.

5. Obsess about attracting people to Chicago again. Fixing the problems of crime, education and jobs is just the start. Combined with reforms, Chicago can grow its way out of its many problems.

If not, the city will continue to lose people. Chicago and Detroit are the only major cities, among the 15 largest cities in 2000, to lose population since then.

Fewer residents means higher debts and taxes on the people who remain. Those higher costs – along with the city’s many other problems – in turn drive even more people out of the city in an ever-worsening downward spiral.

Read more from Wirepoints:

• No ShotSpotter and no cash bail in Chicago is a big mistake. 8 reasons why.

• Suddenly the school board cares about Chicago Public School debts?

• City of Chicago budget revenues have ballooned by $6 billion since 2019. Why the $1 billion deficit?

• Chicago Public Schools is in dire financial straits, yet Chicago Teachers Union blocks closing of near-empty, failing schools.

• Chicago’s worst-in-nation pension crisis strikes again

• An Open Letter to Mayor Brandon Johnson on the forthcoming recommendations of his Pension Working Group

By Charles Kennedy of OilPrice.com,

India plans a massive upgrade and expansion of its power transmission system, expecting investment opportunities of $109 billion to support the integration of renewable energy sources and storage solutions, the power ministry has said.

India’s new National Electricity Plan (Transmission) envisages the addition of hundreds of thousands of kilometers of transmission lines, transformation capacity, and inter-regional transmission capacity by 2032.

India aims to have 500 gigawatts (GW) of renewable energy capacity installed by 2030 and more than 600 GW by 2032, according to the National Electricity Plan.

The country expects its power demand to surge to 708 GW by 2047, India’s Power Minister Manohar Lal said in a statement. To meet this demand, India needs to quadruple its power capacity, the minister added.

“This is not just about increasing capacity; it’s about reimagining our entire energy landscape,” Lal said.

“We have set an ambitious target of 500 GW of non-fossil energy capacity by 2030, effectively doubling our current capacity,” he added.

This push towards green energy aligns with India’s commitment to reducing carbon emissions by one billion tons by 2030 and achieving net-zero emissions by 2070, the power ministry said.

Last month, Renewables Energy Minister Pralhad Joshi said that financial institutions had pledged $386 billion in investment commitments to help India boost its renewable energy industry.

The country will need to install at least 44 GW of clean energy capacity every year by the end of the decade to meet the 500-GW goal, according to Bloomberg’s estimates based on data from the Indian Ministry of Power.

“We received overwhelming commitments from states and Union Territories as well as from the developers, manufacturers, and financial institutes to support our goal of 500 GW by 2030,” Joshi said at the annual Renewable Energy Investor’s Meet and Expo in India.

India-based conglomerates Reliance Industries and Adani are among the companies that have pledged additional renewable energy capacity. Reliance committed 100 GW of additional renewable capacity, and Adani Green Energy pledged to develop 38.8 GW of capacity.

The head of the Iranian Revolutionary Guard’s (IRGC) Quds Force, Esmail Qaani, has been spotted at a military funeral in Tehran after not being seen for two weeks. US media reports earlier this month described that the general “has not been seen in public since Israel killed Hezbollah leader Hassan Nasrallah in a massive air strike on Beirut on Sept. 27.”

On Tuesday he was shown on state TV attending the the funeral ceremony for General Abbas Nilforoushan, who had been killed in the same Israeli airstrike on Beirut which took out Hezbollah leader Hassan Nasrallah.  Nilforoushan’s body was only days ago recovered from deep under the rubble in the south Beirut district of Dahieh.

Qaani’s public appearance is significant given that rumors and rampant speculation had led to regional and international media issuing reports saying he either died in an Israeli strike or was under arrest by the government of Iran.

For example, nearly a week ago Middle East Eye issued a report saying that Qaani was being detained by Iran in order to question him about the circumstances of the series of major security breaches exploited by Israel.

MEE had also said at the time that “Speculation has mounted online and in the media that Qaani was wounded or killed in Israel’s continuous bombardment of Beirut’s southern suburbs.”

AFP now reports of his new appearance in downtown Tehran:

Qaani – who heads the Quds Force, the IRGC’s foreign operations arm – had disappeared from public view and was rumored in some media to have been targeted in an Israeli strike on Lebanon.

He appeared Tuesday at the funeral, clad in the IRGC’s green military uniform.

Nilforoushan’s casket was paraded through the packed streets of Tehran after a funeral ceremony at Imam Hossein Square in the city center.

After weeks of speculation and false reports, IRGC Quds Force Commander Brigadier General Esmail Qaani was seen in an IRIB live broadcasting along with other officials receiving the body of Brigadier General Abbas Nilforoushan at Mehrabad Airport. pic.twitter.com/AmDfWqK8pY

— PressTV Extra (@PresstvExtra) October 15, 2024

Interestingly, some other Western reports had speculated that Qaani had suffered a heart attack or that his health was deteriorating. But he looks healthy in the newly released footage.

As Jerusalem Post highlights, “Last week, the IRGC-affiliated Tasnim news channel claimed that the IRGC General Ebrahim Jabbari had told state media that Qaani was in full health and would be receiving the Medal of Conquest from Ayatollah Ali Khamenei in the near future.”

Iran has remained defiant in the face of an expected Israeli retaliation for the Oct.1st Iranian ballistic missile attack on Israel. Yoav Gallant has said Israel’s response will be “deadly, precise, and surprising.”

Commander of the Islamic Revolution Guard Corps (IRGC) Quds Force Brigadier General Esmail Qaani attended the funeral procession of Martyr Major General Abbas Nilforoushan in Tehran on Tuesday. pic.twitter.com/r2PoRTLYmK

— IRNA News Agency (@IrnaEnglish) October 15, 2024

Tehran has in response said that it desires de-escalation and peace, but stands ready to respond against any aggression. “The Islamic Republic of Iran does not want to escalate tensions or war, but we are ready for any situation. We are prepared for war, but also for peace. This is Iran’s firm position,” foreign minister Abbas Aragchi said Sunday.

Authored by Samantha Flom via The Epoch Times (emphasis ours),

A Georgia judge has ruled that county election officials must certify election results by the statutory deadline regardless of irregularities or suspected fraud.

Georgia law requires county election superintendents to certify election results by 5 p.m. on the Monday following the election—or the Tuesday, if the date falls on a federal holiday, as it does this year.

Fulton County Superior Court Judge Robert McBurney ruled on Oct. 14 that election officials must stick to that deadline.

“No election superintendent (or member of a board of elections and registration) may refuse to certify or abstain from certifying election results under any circumstance,” the judge wrote in his opinion.

McBurney added that if a superintendent should determine a need for additional information from the elections board or other election officials, that information should be provided “promptly,” where unprotected by law.

“However, any delay in receiving such information is not a basis for refusing to certify the election results or abstaining from doing so,” he wrote.

Julie Adams, a Republican member of the Fulton County Board of Elections and Registrations, brought the lawsuit after the county’s appointed election director allegedly denied her repeated requests for access to election results and processes.

“Plaintiff swore an oath to ‘prevent fraud, deceit, and abuse’ in Fulton County elections and to ‘make a true and perfect return,’” Adams’s attorneys wrote in the initial complaint. “These obligations are frustrated by the repeated and continuing refusal to allow Plaintiff access to, and direct knowledge of, the information Plaintiff reasonably believes she needs to execute her duties faithfully and thoroughly.”

Unable to observe the county’s election results and processes herself, Adams voted against certifying the results of the presidential preference primary in March. Her lawsuit sought clarification of the extent of the election director’s role and her own rights as a member of the election board.

In his ruling, McBurney held that election certification is “a purely ministerial task that gives its performer no discretion to exclude some votes while counting others.”

He reasoned that allowing election superintendents to “play investigator, prosecutor, jury, and judge” and refuse to certify results “because of a unilateral determination of error or fraud” would effectively silence Georgia voters.

“Our Constitution and our Election Code do not allow for that to happen,” he concluded.

McBurney’s latest ruling coincided with the start of early voting in the Peach State. Voters will have the option to vote early in person through Nov. 1.

Israel has been at war on several fronts for more than a year at this point, and is rapidly expending ammo and missiles, especially as it tries to shoot down what are now dozens of projectiles daily sent from Hezbollah positions in Lebanon.

Hezbollah is estimated to have an arsenal of hundreds of thousands of rockets and drones of various sizes. Israel’s formidable anti-air defense systems have been regularly engaging inbound threats, sometimes expending hundreds of interceptors a day – and this was particularly true during the Oct.1st Iranian ballistic missile attack.

Israel has long heavily relied on the United States to supply it with heavy artillery, bombs, and missiles – but now appears to be running low on interceptors amid the daily firefights. 

A new Financial Times report warns that Israel’s missile defense shield is being stretched thin, and that the country is more heavily relying on Washington to fill the gaps.

“Israel faces a looming shortage of interceptor missiles as it shores up air defenses to protect the country from attacks by Iran and its proxies, according to industry executives, former military officials and analysts,” FT writes.

“The US is racing to help close gaps in Israel’s protective shield, announcing on Sunday the deployment of a Terminal High-Altitude Area Defense (Thaad) antimissile battery, ahead of an expected retaliatory strike from Israel on Iran that risks further regional escalation.”

One analyst and former US senior defense official, Dana Stroul, stated that “Israel’s munitions issue is serious. Stroul, a pro-Israel and anti-Iran hawk, has described that “If Iran responds to an Israel attack [with a massive air strike campaign], and Hizbollah joins in too, Israel air defenses will be stretched.”

She underscored the limitations in such a scenario for the Pentagon’s stockpiles: “The US can’t continue supplying Ukraine and Israel at the same pace. We are reaching a tipping point.”

We’ve highlighted before that Israel likely cannot sustain wars on multiple fronts without steady support and weapons shipments from the US. As conflict – and Washington involvement – from Eastern Europe to the Middle East escalates, it remains that the only ‘winners’ are the major US defense firms:

Boaz Levy, CEO of Israel Aerospace Industries which produces missile interceptors, adds: “Some of our lines are working 24 hours, seven days a week. Our goal is to meet all our obligations.”

Palestinian media has meanwhile taken note…

“Supply constraints” and the demands of war have left the Israeli military “relying on the US to fill the gaps in protective shields”.

In recent days, the US announced it is deploying the anti-missile system THAAD to Israel as it continues to provide “ironclad” support for its… pic.twitter.com/Ngt2iGXKPG

— Quds News Network (@QudsNen) October 15, 2024

During two separate rounds of Iranian missile attacks on Israel of the past year, the US has deployed warships and fighter jets to assist Israel in shooting down inbound projectiles. But systems like the Iron Dome, Arrow, and David’s Sling remain vital to Israel’s daily defense, especially given Hezbollah’s ramped-up attacks on the north of late. The US has now sent the Army’s THAAD missile defense system.

Will the US ever cut off Israel? It is unlikely, given that both sides of the aisle tend to be led by “Israel firsters” – and sadly the presidential race is no different.

Authored by James Rickards via DailyReckoning.com,

Janet Yellen gave a speech on Sept. 26 at the 2024 U.S. Treasury Market Conference in New York. The speech was largely about risks in the banking system and the market for U.S. Treasury debt.

In a pre-speech interview with Politico, Yellen was asked about risks related to a smooth presidential transition in this election cycle. While that may seem like a straightforward question, it contained a particular bias that somehow Donald Trump, win or lose, might make the presidential transition difficult.

Difficulties could arise if Trump loses and claims the election was “rigged” or if Trump wins and radical groups like antifa commence violent protests. My estimate is that the former is unlikely, and the latter is far more likely but Trump haters in the media will take the opposite view.

Yellen replied, “It really is essential to our having a democratic system and a democratic government, and one of the tremendous strengths of our financial system is that it is based on strong institutions and the rule of law.”

While this statement may seem reasonable on its face, it was Yellen’s thinly disguised way of saying that Donald Trump’s actions on Jan. 6, 2021, and possible similar acts on Jan. 6, 2025, are a threat to the “rule of law” and therefore a danger to the stability of the financial system.

There are many forces at work in this statement by Yellen. In the first instance, this is an example of the Biden-Harris administration “all of government” approach.

What this means is that when the White House has a top priority (open borders, climate change, defeat Trump), every department and agency is expected to advance that goal even if the role of that agency has nothing to do with the issue at hand.

The White House says, in effect, “Find a way.”

So here is Yellen dragging the Treasury Department into the effort to discredit Trump by suggesting he is a threat to the financial system and the Treasury market. This political twist has almost nothing to do with the Treasury’s role in the executive branch except at a stretch.

The irony is that Yellen herself is the greatest threat to the Treasury market through her persistent and illegal efforts to steal $300 billion in U.S. Treasury securities owned by the Central Bank of Russia and held in custody in U.S. and European banks and the Euroclear clearinghouse in Brussels.

That particular threat to steal the Russian securities to be used as backing for a loan to Ukraine has accelerated efforts of the BRICS and the Global South to move toward a new currency linked to gold that would initially compete with the dollar in global payments and eventually rival the dollar as a major global reserve currency.

Those efforts will see major advances made at the BRICS leaders’ summit in Kazan, Russian Federation on Oct. 22–24 hosted by President Putin. The BRICS summit will announce new members. That’s important because expanding the membership is the key predicate to launching a viable payment currency.

Will a new BRICS currency instantly displace the dollar in its role as leading reserve currency? How much of a threat would it be? Read on…

BRICS Currency Won’t Displace Dollar Overnight

The original BRICs membership from 2009 consisted of Brazil, Russia, India and China. South Africa was added in 2010 when the group’s name was changed to BRICS. That group expanded significantly at the 2023 Leaders’ Summit in South Africa when Egypt, Ethiopia, Iran and the United Arab Emirates (UAE) were added.

(Argentina and Saudi Arabia were also permitted to enter but Argentina withdrew its application, and Saudi Arabia deferred its membership saying it was still considering the matter.)

The BRICS has been active over the years in institutionalizing its initiatives.

In 2014, the BRICS created the New Development Bank (NDB), which functions along the lines of the World Bank to promote infrastructure development in emerging economies. The NDB was capitalized with over $100 billion from its members and currently has 53 projects underway with commitments of over $15 billion to those projects.

In 2015, the BRICS established the Contingent Reserve Arrangement (CRA), which acts as a swing lender to members experiencing temporary balance of payments difficulties. In this regard, the CRA functions somewhat like the International Monetary Fund. Between the NDB and the CRA, it is clear that BRICS are intentionally constructing their own version of the Bretton Woods institutions but with their own controls and membership.

Beyond the nine current members, there’s a waiting list of over 20 aspiring members including economic powers such as Nigeria, Venezuela, Indonesia, Malaysia, Turkey, Thailand and Vietnam. Current members Russia, UAE and Iran make BRICS an oil output heavyweight.

Russia, China and South Africa are among the world’s largest gold producers. India and China alone have a combined population of 2.8 billion or 35% of the entire population of the globe.

The BRICS are part of an emerging Global South that is challenging the Collective West for world economic and geopolitical dominance.

The subject of a BRICS currency is confusing to most observers and is a fraught topic even for many experts. We’ll call the potential currency a BRIC for convenience although no formal name has been announced.

The starting point is to distinguish between a payment currency and a reserve currency. A payment currency is used to settle purchases and sales of tradable goods and services. A reserve currency is the denomination of the currency in which national savings are invested, typically in U.S. Treasury securities or gold.

Some currencies perform both functions as reserve and payment currencies especially U.S. dollars and euros. A finance minister or central banker can move from one to the other; currencies earned can be invested as reserves or reserves can be sold to finance purchases.

Still, it’s important to bear the distinction in mind when evaluating the use case for each currency, especially BRICs. Put differently, a flaw or deficiency in one usage does not preclude the other.

The BRICS currency is very far along in establishing itself as a viable payment currency. The prerequisites are: agreed-upon value (which can be fixed to another currency, floating or pegged to a weight of gold), secure payments channels (basically high-speed, encrypted digital pipes for authenticated message traffic), digital ledgers and an agreed issuer (the NDB based in Shanghai may be suitable for this purpose but another institution could be created).

The single most important element is a sufficiently large membership in the BRICS currency union such that a recipient of BRICS payments can use them for purchases in many jurisdictions for many goods and services.

This last point is where most alternative currency payments arrangements fall down. Russia can sell oil to China for yuan (which they are currently doing) but they are constrained in terms of where they can spend the yuan (basically limited to Chinese manufactured goods and semiconductors). The same issue arises when Russia sells oil to India (for rupees) or weapons to Iran (for rials). The seller is limited in terms of what they can buy with the trading partner’s currency.

This constraint goes away in a currency union with 15 or 20 members or more. If Russia earns BRICs from China, they can buy Embraer aircraft from Brazil or semiconductors from Malaysia. For that matter, use of a payment currency in a multimember currency union is not limited to members.

With access to the payment channels, non-members can nevertheless agree to receive the BRICS currency in payment confident in their ability to spend it among the other BRICS members who are trading partners. The proof of this is the eurozone, which is currently a 20-member currency union with a single central bank and worldwide acceptance of the euro.

Moving from a payment currency to a reserve currency is more difficult. The prerequisite here is a large, liquid bond market. That bond market has to be surrounded by extensive transactional and legal infrastructure including: securities at all maturities (30 days to 30 years), an underwriting system (primary dealers in the U.S.), an auction system for sales of new issues, a repo market to finance inventories, futures, options, other derivatives (swaps), settlement channels, custodians (DTCC, others), etc.

Above all, holders need a good rule of law regime on which to rely in the case of disputes or defaults. All of these elements exist in the reserve currency bond market nonpareil — the U.S. Treasury securities market. None of it exists in the form of a putative BRICS bond market. It would likely take 10 years or longer to create reserve currency infrastructure with the biggest single impediment being the rule of law.

That said, there are several interesting developments taking place.

The first is that the U.S. is squandering its rule of law advantage with sanctions on Russia, the freezing of the assets of the Central Bank of Russia and efforts to actually steal those assets and convert them into a $50 billion loan to Ukraine using structured finance.

Given this rogue behavior by the U.S., countries are becoming more cautious about large U.S. Treasury note reserves. This may account in part for the recent rally in the price of gold.

The second is the upcoming BRICS summit in Kazan.

Russia will announce significant progress in building out secure payments channels and will admit new members, which will drive the group closer to the critical mass needed to launch a currency union.

Finally, the impact of Yellen’s efforts to steal U.S. Treasury securities from Russia goes beyond the BRICS meeting and the rise of a new payment currency. Yellen’s blatant theft from the Central Bank of Russia is a driving force behind the price of gold reaching new all-time highs recently.

Central banks have been net buyers of gold since 2010, but the tempo of gold buying has increased as the U.S. rule of law under policymakers like Yellen begins to crumble.

Gold is a physical non-digital asset that cannot be stolen, frozen or seized provided it is in safe storage. Until the BRICS currency is ready, gold will be the asset of choice for foreign reserve managers faced with a rogue Treasury Secretary.

What began as a political hack (to beat Trump) has turned into another driver in the downfall of the dollar and the U.S. Treasury market. This is one more example of short-term, self-defeating thinking by the White House and the U.S. Treasury.

A cold front swept across the north-central US through the eastern half of the US late weekend into the early part of the new week. For readers based in the east and central US, Brrr! It’s a chilly morning as fall-like weather roars in, and it could get even chillier into Wednesday. 

“Below average temperatures forecast across the central and eastern United States, while summer-like warmth remains over portions of Texas today and the northern Plain by Wednesday,” NWS’ Weather Prediction Center wrote on X. 

Below average temperatures forecast across the central and eastern United States, while summer-like warmth remains over portions of Texas today and the northern Plain by Wednesday https://t.co/A3RX3bxaUJ

— NWS Weather Prediction Center (@NWSWPC) October 15, 2024

X user MyRadar Weather shows the cold blob of Canadian air descending into parts of the central and eastern US.

See that big bowling ball of cold over the Great Lakes? That’s helping milder air over the Great Lakes to rise, priming the atmosphere for waterspouts.

Don’t be surprised to see a few spouts, especially on Lake Michigan! pic.twitter.com/c2SW8X1yol

— MyRadar Weather (@MyRadarWX) October 14, 2024

As of Tuesday morning, tens of millions of people from the Plains to the Appalachians and Northeast were under frost or other winter alerts as temperatures were below freezing in many parts. 

Snow showers have been reported in the mountains of Western Virginia, with accumulation already taking place at the Canaan Valley ski resort.

A chilly start to Tuesday as most areas dropped into the 30s. Snow is falling in the WV mountains & accumulating at Cannan Valley as seen on the webcam. Highs stay in the 50s today with isolated showers possible this afternoon. Some graupel could be possible. #MdWx pic.twitter.com/KoPHboEt5A

— Ryan Kane (@ryankanerWX) October 15, 2024

Accumulating snow was reported in the Northeast. 

I don’t always make a forecast from over a month away for #snow in a specific area, but when I do…☃️#WinterIsComing #wxtwitter #wxX #PAwx #NYwx #VTwx pic.twitter.com/duqyGfHL4f

— Mark Margavage (@MeteoMark) October 15, 2024

Wednesday will also be the chilliest day of the week. 

More broadly, across the Lower 48, global warming seems to have disappeared after MSM reporters warned this summer the Earth was doomed – yet – here we are now – and it’s chilly out. Temperatures in the US are tracking a 30-year seasonal trend lower.

This latest cold front has ushered in a proper autumn chill for tens of millions. It’s about the time for households who can build those firewood stockpiles to do so ahead of what could be a cold and snowy winter. Terrible ‘green’ energy climate policies have sent power bills through the roof – one way to offset this is to burn cheap wood or coal.

Via SchiffGold.com,

In this week’s episode, Peter offers an important reminder: the government has a strong incentive to bend the truth with their data, especially when we’re less than a month out from an election. Beyond this, Peter spends time discussing the proliferation of free market ideas on X, declares Grover Cleveland to be the last good Democratic president, and explains the broken window fallacy in light of Hurricane Milton. 

With last week’s jobs numbers still in the news cycle, Peter reiterates why they’re unreliable. Bidenomics shills like Paul Krugman are sorely mistaken:

“The numbers don’t matter anyway. They are subject to massive revisions in the following month, even in the following year. … The government grades its own report card. It doesn’t want to give itself an F, especially when you’re a month away from an election. So there is a lot of political pressure to make these numbers look good, especially the inflation number and the unemployment number.”

The data does not align with Americans’ feelings toward the economy, and knowing that thousands of new government jobs have been created doesn’t help the working class:

“It defies logic that people would be working two or three jobs and have maxed out their credit cards, be mired in more debt that they’ve ever been, despite working more jobs than they ever had, and say, ‘Oh, we’ve got a great economy.’”

This numerical deception is augmented by the fact that one key metric– inflation – has had its meaning corrupted by state statisticians:

“[Inflation] is an Orwellian double speak to pretend inflation is rising prices, but they’ve already pulled that off. But now that they’ve got the public to accept the false definition, they keep changing the index that measures those prices.”

Peter comments on Elon Musk’s recent pro-market posts featuring economist Milton Friedman, in which Friedman explains that government creates inflation:

“It’s not greedy companies. He [Friedman] says, ‘Businessmen are greedy. That’s just the way people are. They’re no different than anybody else. We’re all greedy.’ And greed doesn’t cause inflation. I’ve pointed out that greed actually brings prices down.”

Another recent source of economic fallacies is the havoc caused by hurricanes Milton and Helene. Many politicians wrongly assume both that the federal government is responsible for hurricane relief and that natural disasters are a boon for the economy. This is nothing more than a revival of the long-debunked “broken window fallacy:”

“You’re never better off because you have to rebuild something that was destroyed or because you waste your money. Like the Keynesians say, “Look, as long as we spend the money, it’s good for the economy.” … It’s like digging a hole, paying people to dig it, and then paying someone else to fill it back up. At the end of the day, you’re right back where you started. You’ve spent a lot of money, a lot of people have worked, but there’s nothing to show for it.”

Even worse is the fact that federal intervention has made natural disasters more destructive. By subsidizing insurance in disaster-prone regions and crowding out local aid, organizations like FEMA ultimately make people more vulnerable to disasters: 

“In fact, because now everybody expects the federal government to take care of every emergency, nobody is prepared. It would be much more efficient if we allowed local governments to pay for their own disasters and prepare for them. But we’ve created this huge moral hazard—that’s the real disaster. It’s the moral hazard created by FEMA. Now, natural disasters collectively cost a lot more because we’ve outsourced everything to the federal government, which even subsidizes people to build in flood zones.”

In times of disaster, federal policy should mirror the actions of the last admirable Democratic president:

“Grover Cleveland was the last great Democratic president. When there was a drought in Texas and Congress appropriated around $10,000 to help the drought-stricken farmers, he vetoed the bill. … He said, ‘I could lay my finger on no section of the Constitution that authorizes this spending.’ So he vetoed it. He said, ‘Look, I feel badly for the farmers, and I want to help them, but as president, I can’t use taxpayer money to help them.’”

If you missed it, check out Peter’s Commodity Culture interview from this week, where he dives deep into the economics of current global events.

Walgreens shares in New York surged the most in 16 years on Tuesday after the struggling pharmacy chain delivered an unexpectedly optimistic forecast for 2025. Simultaneously, Walgreens announced plans to shutter over a thousand stores nationwide as its turnaround plan gains steam. 

Fourth-quarter earnings were 39 cents, beating the Bloomberg consensus of 36 cents. This indicates that the struggling drugstore chain is executing on its aggressive cost-cutting measures in an ambitious turnaround plan after years of pain.

Here’s a snapshot of the quarterly results (courtesy of Bloomberg):

• Adjusted EPS 39c vs. 67c y/y, estimate 36c
• International sales $5.97 billion, +3.2% y/y, estimate $5.84 billion
• Sales $37.55 billion, +6% y/y, estimate $35.56 billion
• Adjusted gross margin 16.9% vs. 18.6% y/y, estimate 17.6%
• US Retail Pharmacy Sales $29.47 billion, +6.5% y/y, estimate $27.48 billion
• US Healthcare Sales $2.11 billion, +7.2% y/y, estimate $2.15 billion
• Adjusted gross profit $6.33 billion, -4% y/y, estimate $6.24 billion
• Adjusted operating income $424 million, -38% y/y, estimate $396 million

With the fourth quarter print not so bad, Walgreens issued profit guidance for 2025 that was in line with the average analysts tracked by Bloomberg:  

• Sees adjusted EPS $1.40 to $1.80, estimate $1.73 (Bloomberg Consensus)
• Sees sales $147 billion to $151 billion, estimate $146.9 billion
• Sees adjusted operating income $1.6 billion to $2.0 billion, estimate $1.89 billion

CEO Tim Wentworth wrote that the “turnaround will take time, but we are confident it will yield significant financial and consumer benefits over the long term.”

Walgreens also announced that 14% of its US stores, or around 1,200 locations, will close over the next three years. About 500 of those stores will close in 2025.

In June, the drugstore chain announced that 300 underperforming locations would close as part of the turnaround plan. It also noted about a quarter of all stores were unprofitable and would usher in “imminent” changes.

Here’s analyst commentary about Walgreens’s ER and turnaround plan:

Leerink Partners, Michael Cherny (market perform, PT $9)

• Says WBA’s FY25 guidance “needs more details from the upcoming deck on the full breakdown from revenue guidance to EPS guidance”
• The updated commentary on the store closure plan is a start, although further visibility into the makeup of the closures is going to be another focus
• “All-in, the FY4Q’24 print and FY25 guidance was not as bad as it could have been, which is somewhat of a positive relative to recent trends”

Evercore ISI, Elizabeth Anderson (in line, PT $7.50)

• Says WBA finished its FY24 on a relative high note, with strong pharmacy comp sales
• “US Healthcare adj op margin was also positive (first time!) as the company continued to make progress on both GMs and OpEx”

Barclays, Stephanie Davis (underweight, PT $7)

• Calls the 2025 guidance “better than feared”

Jonathan Palmer, an analyst with Bloomberg Intelligence

• “The decisive decision to shutter a large cohort of underperforming stores is a positive in a narrative where the expectations are exceedingly low.” 

WBA shares jumped as much as 15% in markets—the most in 16 years. Shares peaked at the $96 handle in August 2015 and have since tumbled 91%. The latest downward pressure comes from budget-conscious consumers. 

We wonder how many of the Walgreens stores slated to close next are in lawless progressive cities. 

Brazen theft at @Walgreens. Yet @Flo4Sacramento is against @YesOn36Now and said cut @TheCityofSac police by -20%. pic.twitter.com/sa5bZW96Oi

— BetterSacNow (@SunnySacParks) October 13, 2024

In San Francisco, we went to the Walgreens that is the #1 spot for theft in all the 9000 US stores, per Walgreens. This is where chains once shut the freezer section. And we saw 3 thefts right in front of us. But across SF, coffee, mustard, nail polish– are all locked up: pic.twitter.com/IfYBVgpeI2

— Kyung Lah (@KyungLahCNN) July 25, 2023

Unchecked theft in Portland

Guy with sleeping bag was stealing through Walgreens, walked behind the counter and stole from the cigarette section, and left while the poor beaten down checker asked him to stop. Thief knows there’s no consequences

Checker didn’t even notice the… pic.twitter.com/wOCqT6H9EN

— garbage ghost Tara Faul⚡️ (@tarafaul503) January 15, 2024

Here’s what ⁦@annamajaCNN⁩ & I saw at San Francisco’s Richmond area Walgreens, the worst spot of all 9000 US Walgreens for theft, per the co. We watched 3– and grabbed video of this shoplifter walk out right in front of us. pic.twitter.com/XJJxNcJ8Yj

— Kyung Lah (@KyungLahCNN) July 25, 2023

Group of thieves steal cash registers from Walgreens in Oakland, California pic.twitter.com/s70gUKdMLN

— BAY AREA STATE OF MIND (@YayAreaNews) November 3, 2023

Sigh.