By Charlie Zhu and Helen Sun, Bloomberg markets live reporters and strategists
Three things we learned last week:
1. China’s top leadership is finally making a concerted effort to get the economy and external relations back on track. A rare move to raise the budget deficit mid-year, along with President Xi Jinping’s unprecedented visit to the central bank, underscored a sense of urgency among policymakers to support growth.
For starters, a plan to sell 1 trillion yuan ($137 billion) of sovereign debt over the last nine weeks of the year may finally be the bazooka many investors have been asking for earlier.
Beijing’s diplomatic moves also provided cause for some optimism. Xi sat down with California’s Gavin Newsom, the first time he met a US state governor in more than six years. Foreign Minister Wang Yi’s US trip has also paved the way for a leaders’ meeting next month.
The world’s two largest economies rebuilt communication lines on the economic and financial front. Two working groups which involve officials from the central banks, treasury departments, securities regulators held their first meetings last week respectively.
China also invited US officials to a defense forum to be held this week. While thorny issues remain for the two, these developments help Beijing create a more stable geopolitical environment that serves as a precondition to woo back foreign investors.
The benchmark CSI 300 Index posted the biggest weekly gain in two months. Foreign investors showed up via the northbound stock connect, buying for two consecutive days, the first time since early August.
2. Those are of course not silver bullets for China’s challenges. Among them, an ongoing property crisis comes on top of the list. With former top developer Country Garden Holdings Co. deemed to be in default on a dollar bond, recent weakness in China Vanke Co. and Gemdale Corp.’s notes spurs concerns that the sector is still deep in the doldrums.
Economic growth may drop below 3% in 2024 if the real-estate slowdown deepens, according to S&P Global Rating. Its base-case scenario is for growth rate to slow to 4.4%, down from Beijing’s targeted 5% this year.
A series of arrests across industries, an investigation into Taiwan’s Foxconn Technology Group — the biggest private employer — along with the removal of Li Shangfu as defense minister without explanation, again shook the confidence of foreign companies.
The recent reaction from market participants to earlier stimulus measures bear resemblance to the Tacitus Trap, Ken Cheung, Mizuho Bank Ltd.’s chief Asia FX strategist, wrote in a note, referring to a political theory where a government fails to win approval even for the right policies.
While building confidence in the economy will require time, adopting more timely and targeted policies to address socio-economic issues can help mitigate the risk of falling into the trap, and enhance the effectiveness of the economic stimulus, Cheung said.
3. China’s slowdown and financial risks are rippling through other markets and global businesses. Falling Chinese stocks are placing as much as $71 billion of structured products in South Korea at risk when they mature next year.
Meanwhile, Standard Chartered Plc’s profit missed estimates in the third quarter, as the lender took a $186 million charge on Chinese real estate and an impairment of $700 million on China Bohai Bank. Nomura Holdings Inc. is overhauling its local business after losses there snowballed.
Hiking 401k Contributions Can Now Boost College Aid, Thanks To FAFSA Change
Thanks to new federal rules, boosting your pre-tax contributions to 401(k) and similar retirement plans may now increase your child’s access to federal financial aid. Another change makes grandparent-owned 529 plans more beneficial.
Pre-tax contributions are ones that aren’t exposed to current-year federal income taxation, but instead are taxed when withdrawn. They differ from Roth contributions, which are taxed in the current year but can be withdrawn tax-free in your retirement.
Until now, the Free Application for Federal Student Aid (FAFSA) asked parents to input their pre-tax retirement-plan contributions. The calculations then added that money back to arrive at the parents’ total income, which in turn increased the amount those parents were assumed to have available to pay for college, and thus reduced the child’s eligibility for aid.
The revised FAFSA form, which is geared toward simpler calculations driven by data on income tax returns, won’t ask you about those retirement contributions, which means the more pre-tax money you add to your 401(k) or similar account, the higher your child’s chance of qualifying for federal handouts.
For 2023, the 401(k) maximum is annual contribution $22,500, or $30,000 if you’re 50 or older at the end of the calendar year. Note the FAFSA uses data from two years before the academic year you’re seeking aid for. Thus, 401(k) contributions you make in 2023 will effect the FAFSA math for the 2025-26 school year.
Because there are other numbers at play in the aid calculation, jacking up your contributions doesn’t guarantee you’ll get a FAFSA benefit. “This change will have the biggest impact on middle-income households that make around $100,000 a year,” reports the Wall Street Journal’s Oyin Adedoyin, citing financial advisors.
In another wrinkle, 529 plans owned by someone other than a student or the student’s parent won’t be included in the asset calculations, even if the student is the beneficiary. That puts generous grandparents and other relatives in a better position to help out.
You can even add your own money to that 529 — but you better have high confidence in the account owner’s intentions. You should also ponder a scenario where that third-party 529 owner predeceases your college student. If no successor owner is named, the account might go through probate and end up in the hands of someone who’d prefer using the money to buy a new car.
Not all the FAFSA changes will make receiving aid easier:
The “sibling discount” — which previously cut applicants a break in situations where two kids are in college simultaneously — is vanishing.
Parents will have to start reporting the value of small businesses they own.
David Hogg Now Blames “White Woman In Suburbs” For Gun Violence
Anti-gunner and now ‘Harvard-educated’ David Hogg believes just because he went to an elite university (a university that is sympathetic to Hamas), he is the voice of reason when it comes to the Second Amendment.
The confused Gen-Zer’s latest post on X now shifts the blame of gun violence from ‘it’s the gun’ to ‘it’s white women in the suburbs’:
“We will never end gun violence until white woman in the suburbs stop voting for the republicans who are endangering our schools and communities by flooding them with guns.”
We will never end gun violence until white woman in the suburbs stop voting for the republicans who are endangering our schools and communities by flooding them with guns.
Hogg is not ready for this conversation, as his bigotry against white women in the suburbs is uncalled for as a recent poll from NYPost, citing Wallet Hub data, shows murder rates in Democratic areas, including Memphis, Tennesse; New Orleans, Louisana; Richmond, Virginia; Washington, DC; and Detroit, Michigan, with soft-on-crime policies, are surging.
Instead of being sexist, Hogg might want to step foot in an imploding Democrat metro area, and there are many to choose from, such as Detroit and or Baltimore, where failed progressive policies, such as ‘defunding the police’ have descended these metro areas into a collapsing-state.
As for those white women in suburbia (in fact, any woman of any race) – they have a God-given right to use reasonable force, including deadly force, to protect their families and themselves against an intruder in their home – especially since the average police response time in suburbia can be ten minutes or more.
Just remember, Harvard-elite Hogg, as well as anti-gun groups Giffords and Everytown, some of which are funded by billionaires, want to disarm law-abiding citizens – at a time their Democrat friends across major metro areas are implementing disastrous policies that have sparked crime waves nationwide.
Hogg’s idiotic comments aren’t fooling average folks:
let’s look at where the violence is being committed
Researchers recently discovered that they could give young, healthy animals Alzheimer’s disease by transferring the gut microbiome of human subjects with Alzheimer’s into germ-free rats.
Published on Oct. 18 in Brain, the findings solidify that the microbiome—the collection of bacteria, viruses, and fungi that live mostly in the colon—has a role in the development of Alzheimer’s, the most common form of dementia, affecting 6.7 million Americans.
“This study represents an important step forward in our understanding of the disease, confirming that the makeup of our gut microbiota has a causal role in the development of the disease,” King’s College London neuroscience professor Sandrine Thuret, one of the study’s senior authors, said in a statement.
Our intestines are home to trillions of these microscopic bugs, which mostly live in symbiosis with the human body. Many factors, including antibiotics, glyphosate, medications, and stress, have been proven to kill beneficial microorganisms and cause an imbalance often referred to as dysbiosis.
Exactly what causes the microbial shift in people with Alzheimer’s disease is unclear.
“Bigger picture, it is likely that no one factor, food or lifestyle change will, on its own, reduce the risk of developing cognitive decline as we age,” Percy Griffin, Alzheimer’s Association director of scientific engagement, said in a statement to The Epoch Times.
“Although this work is intriguing, it is still very preliminary. Larger studies in animal models, and then in humans, are required to make generalizations on what can be done in this area to reduce the risk of developing Alzheimer’s.”
Transferring Impairments
There were 69 healthy control subjects and 64 Alzheimer’s patients in the study. Patients with Alzheimer’s had a higher abundance of inflammation-promoting bacteria in fecal samples, and these changes were associated with their cognitive status. Those traits were then found through a battery of behavior tests in only the rats that were given transplants from Alzheimer’s patients.
“The memory tests we investigated rely on the growth of new nerve cells in the hippocampus region of the brain. We saw that animals with gut bacteria from people with Alzheimer’s produced fewer new nerve cells and had impaired memory,” lead author professor Yvonne Nolan said.
Alzheimer’s disease’s link to the microbiome has already been explored in recent studies, although it’s been largely unclear whether the disease caused the dysbiosis or if—as this research indicates—alterations in the intestinal community cause symptoms of dementia.
Mr. Griffin, who holds a doctorate in molecular cell biology from Washington University in St. Louis, noted that studies in rats don’t always indicate that similar findings will occur in the human body. To build credibility, the research needs to be replicated, he said.
“This is an interesting study that adds to our growing understanding of how the bacteria in the gut may contribute to risk for Alzheimer’s disease. But this study is in rats, and rats are not people,” he said. “That said, these findings demonstrate a possible role for gut bacteria in affecting the areas of the brain that are (a) associated with memory and (b) involved in Alzheimer’s disease.”
Presymptomatic Identification of Disease
However, dysregulation of the microbiome could give early insights into disease, which has long been associated with systemic inflammation.
“Understanding the role of gut microbes during prodromal–or early stage—dementia, before the potential onset of symptoms may open avenues for new therapy development, or even individualized intervention,” Ms. Nolan said. “People with Alzheimer’s are typically diagnosed at or after the onset of cognitive symptoms, which may be too late, at least for current therapeutic approaches.”
A study in Cell Death and Differentiation in 2019 found that impaired neurogenesis is a biomarker for Alzheimer’s. Neurogenesis is the continued development of neurons that occurs in two parts of the adult brain, including the hippocampus, which is responsible for learning and memory.
“Remarkably, it has been recently described that neurogenesis persists in cognitively healthy people until the end of life, but drops off dramatically as AD [Alzheimer’s disease] pathology takes hold,” the study reads.
New research is showing that neurogenesis impairment begins before amyloid-plaque formation, the clumping of protein pieces found in the brains of Alzheimer’s patients. Taken together, neurogenesis and the microbiome offer evidence that suggests that the disease can be identified in stages in which its development could be halted before symptoms set in.
Alzheimer’s is the most common cause of dementia, which is marked by memory loss and other cognitive disabilities that interfere with daily life. According to the Alzheimer’s Association, 1 in 3 people are likely to develop Alzheimer’s.
“Alzheimer’s is an insidious condition that there is yet no effective treatment for,” Ms. Thuret said. “This collaborative research has laid the groundwork for future research into this area, and my hope is that it will lead to potential advances in therapeutic interventions.”
What’s Influencing the Microbiome?
The microbiome is a key area of Alzheimer’s research worldwide due to its vulnerability to lifestyle and environmental factors.
The Alzheimer’s Association is leading the U.S. POINTER study, which finished recruitment in March and is expected to begin reporting results in 2025. The two-year clinical trial is evaluating whether lifestyle interventions that simultaneously target many risk factors can protect cognitive function in older adults who are at increased risk for cognitive decline.
“All of our body systems are interconnected, and it is important to understand how they work together to impact the risk and resilience against Alzheimer’s,” Mr. Griffin said. “For ongoing and overall good health, people should speak to their doctors about their digestive health and ways to keep it operating healthfully, such as drinking enough water and eating enough dietary fiber.”
He’s hopeful that the POINTER study will help determine a sustainable, community-based lifestyle intervention recipe to reduce the risk of developing cognitive decline as we age.
It’s the kind of work that some organizations have already been doing, even without studies that fill in the blanks of causation with Alzheimer’s disease.
Dr. Dale Bredesen has been reversing symptoms with a research-based protocol. Sharp Again Naturally offers programs that address nutrition and create a healthy gut microbiome to help participants preserve and improve their brain health.
The new study is hopeful, according to the board chair of Sharp Again Naturally, Steve Ledvina, who’s also a certified health and wellness coach and the founder of Knowing Alz.
“This exciting study extends the evidence for the strong connection between the gut microbiome and the brain and suggests poor gut health has a causal role in Alzheimer’s symptoms,” Mr. Ledvina wrote in an email to The Epoch Times. “For individuals, it emphasizes that intentionally maintaining or healing our guts and promoting a healthier gut microbiome is essential to keeping our brains healthy.”
He said potential causes of poor gut health include excessive sugar or alcohol consumption, antibiotics or other gut-disrupting medicines, and stress.
“We can promote our gut health by eating prebiotic fiber in vegetables like asparagus and artichoke hearts and probiotics like sauerkraut, kimchi, and low-sugar kombucha,” Mr. Ledvina said.
The world is experiencing a historic surge in interest rates. Jim Grant, editor of «Grant’s Interest Rate Observer», believes the turmoil could be the beginning of a multi-decade bear market in bonds.
In this in-depth interview, he explains what the risks are – and where opportunities arise.
The spike was unexpected: In the US, the yield on 10-year treasuries is rising rapidly toward 5%, the highest level since 2007. From Europe to Japan to Australia, long-term interest rates are also trending upward almost everywhere in the world. There is much speculation about the causes. What is clear, however, is that this shock will not be without consequences.
«It raises the interesting possibility that we are embarked on a new bond bear market,» says Jim Grant, editor of the iconic investment bulletin «Grant’s Interest Rate Observer». «Bonds are unusual in the world of financial assets as their prices historically tend to trend in generation-length intervals; something we don’t see so much in stocks or commodities», he adds.
In this in-depth interview with The Market NZZ, which has been lightly edited for length and clarity, the seasoned expert on financial history explains what persistently higher interest rates could mean for investors, what risks are associated with this new environment and where long-term opportunities arise.
«I think gold ought not to trade as an inflation hedge, but as an investment in monetary disorder of which we surely have enough in the world»: Jim Grant.
Mr. Grant, «Grant’s Interest Rate Observer» is celebrating its 40th anniversary. What are you currently observing in connection with the massive surge in interest rates that the financial markets are experiencing?
Well, we certainly have something to observe. It’s been a long time, so I would say a couple of things. One is that the movement from interest rates bordering on nothing to interest rates knocking on the door of normal – that speed of rise – is something we have rarely, if ever, seen before. It’s like a car going from 0 to 60 mph in four seconds. So this is a very rapid and, one might conjecture, a very disruptive rise because it has been so fast.
How can this turmoil in the bond market be put into historical perspective?
It raises the interesting possibility that we are embarked on a new bond bear market. Bonds are unusual in the world of financial assets as their prices historically tend to trend in generation-length intervals; something we don’t see so much in stocks or commodities.
How did such generational cycles play out in the past?
In the United States, bond yields fell from around the end of the Civil War for 35 years to the end of the 19th century. Then, they rose very gradually for 20 years, whereupon they fell again from around 1921 to 1946. Next, the great post-war bond bear market began, taking yields all the way up to 15% in 1981. After that, the great bond bull market started that took yields down to 1% in 2021. Of course, in Europe and Japan yields on shorter-dated securities fell even well below zero, to the tune of $16 trillion of securities were priced to yield less than nothing.
What can be derived from this for today’s environment?
Going back about 150 years, there has been a succession of bond bull and bear markets, each one at least 20 years in length. So perhaps since 2021 we have begun a lengthy excursion to the upside in yields – and if that’s the case, the catch phrase ought to be not «yields for longer», but «yields for much, much, much longer». Then again, nothing says this exercise in pattern recognition necessarily guarantees any future outcome. But for what it is worth, this is one way to frame this most violent and dramatic rise in bond yields.
Why do you think a new cycle may have begun in the bond market?
Here’s one way to think about it: In 1981, President Reagan saw that the air traffic controllers’ union was threatening to strike. So he warned them not to strike, arguing it’s against the public and it’s illegal. The air traffic controllers struck anyway, so Reagan fired them all and brought in new ones. That was about the time when interest rates peaked. It was a marker of the times. Back then, we didn’t know that this was the end of a 45-year bond bear market. It was a symbolic end: President Reagan broke this important union. It was a change; it was like commodity prices breaking in 1980.
And what does this have to do with the current situation?
Fast forward to today, another President, Joe Biden, goes out to Detroit. He walks the picket line in solidarity with the strikers of the auto union, encouraging them: «Hang in there, you got it!» To me, that is another sign of the times, another kind of omen. So it might just be that we are embarked on rates much, much, much higher for much, much, much longer. And, it might just be that we are embarked on not just a cycle of inflation but an age of inflation.
So should we expect further tremors in the bond market?
We’ve just talked about how fast this bond bear market we’re hypothesizing about has been to date. But we haven’t talked about the tempo. For instance, at the beginning of the previous bond bear market in 1964, it took ten years for the yield on long-dated treasuries to go from 2¼% to 3¼%. So nothing says that the current rate of speed is going to continue. As a matter of fact, it can’t continue because otherwise rates would need three digits to write them down. So based on form, on the historical precedent, the tempo is going to be very measured at times. In other words, it might just be that for a certain time, the bond market won’t be very dramatic at all. Yet, it won’t go back to 2%, which will be good for some people, not good for others, but in any case, very different from what we’ve seen over the last four decades.
What are the consequences of this fundamental change for investments?
During the course of not one investment career, but rather one and a half investment careers, the whole world has become accustomed to interest rates basically only going in one direction. Of course, there was plenty of volatility along the way, but persistent, if not continuous declines in rates have been the norm for the careers and investment minds of most living human beings. Consequently, expectations are deeply embedded in our collective psyche that rates do one thing, which is to decline. Yet here we are, observing them go up. So it’s no wonder that many people don’t exactly want to believe it. It’s highly irregular, and not at all in the way of our collective experience going back many, many years.
So how will this change the environment for investment?
During the great protracted bond bull market beginning in 1981, bonds and stocks could reliably be expected to move inversely from one another: Stocks would go up, bonds down, and vice versa. As a result, bonds provided a nice hedge or cushion to one’s equity exposure. That was the case for a long time, and it was especially attractive when bonds were yielding something. Indeed, long-dated treasuries yielded 14% as recently as 1984, and as much as 10% as recently as 1987. So for many of the past forty years, bonds not only provided a portfolio balance, but also delivered a substantial measure of interest income along the way.
And today?
This advantageous arrangement ended, or at least became much less advantageous, during the long period of zero percent rates and QE: Bonds yielded very little and might have provided some cushion, if stocks decline. But there was no great interest income for a long time from one’s bond position. Today however, there is a possibility that bonds and stocks could decline at the same time, as was the case for many years in the last bond bear market, beginning in the late Sixties and continuing into the early Eighties. So correlations could change. The popular 60/40 portfolio could deliver disappointing returns, rather than persistently attractive ones – and that too would be a big change in the investment weather.
That’s not exactly an uplifting outlook.
This is not to say that in a time of persistently rising yields, there aren’t some distinct advantages from the saver’s, the long-term investor’s point of view. One of the classics of fixed income investing is a book called «Inside the Yield Book» by Martin Leibowitz and Sidney Homer. It came out at a time when yields were printed and bound in books, before the digital era, the Bloomberg era. Chapter one of the 1972 edition of «Inside the Yield Book» is entitled «Interest on Interest». It describes the arithmetic of a bond investor investing semi-annual coupons at rising rates of interest, pointing out that interest on interest for long periods can contribute as much as one half of the total return. It points out further that in times of rising yields, the yield to maturity is going to be higher than the yield at which you purchased the bond because you will be investing not at the coupon rate, but at ever increasing rates.
How exactly does this compounding effect work?
Let’s say, you buy a 6% bond maturing in thirty years. In a bond bull market with continually declining interest rates, you reinvested that 6% coupon in ever lower rates and thereby ever lower returns. So the yield to maturity was not 6%, but something less than that. Now, imagine you purchase that same security today in an environment with persistently, if not continuously rising rates over the next thirty or forty years. The rate you earn on that coupon won’t be 6%. It’s likely to be something higher, and therefore your yield to maturity is going to be better than 6%.
So a bear market in bonds also brings benefits?
Indeed. For investors, it opens up another new vista to come: opportunities for interest on interest. Of course, this does not apply to people who need coupon income to pay their rent and buy their groceries. But for savers, for pension funds, for sovereign wealth funds, for people who are in the business of reinvesting their interest income this is a not-disadvantageous thing, this bond bear market. But again, to re-emphasize: This is all hypothetical, I don’t want to sound like some cocksure dogmatic prophet, which I assure you I am not.
But let’s assume you are correct in your thesis on the future development of interest rates. In principle, do bonds therefore offer an attractive alternative to equities in the portfolio?
Yes, what is old will be new again. Bonds really earn something besides nothing or less than nothing which was the case for a long time. But as mentioned earlier, it’s going to take some time getting used to it. So far, the stock market pretends not to notice. This seems surprising. As we point out in a recent issue of «Grant’s», the volatility of the bond market is very elevated, whereas the volatility of the stock market is very subdued. So you have to ask yourself: How can complacency reign in junior securities, when anxiety is the mood in the market of senior securities? This doesn’t make intuitive sense.
Where could the pressure of rising rates cause major problems?
I suspect that this most sudden and even violent lurch higher in interest rates is going to test financial structures that came into being during the period of very low nominal interest rates. Think of what all came into being, when money was proverbially free from 2010 to 2021: Cryptocurrencies flourished, dito venture capital and private equity. There were no constraints on sovereign debt issuance, so public credit was expanded dramatically. Interest expense seemed to be forever minimal and not worrisome because, after all, rates would never rise. To some degree, the entire world was capitalized on the expectation of extremely low interest rates.
And how do things look now?
All that has changed, but not in the expectations yet. I think people are still trying to deal with the shock of the perception of the possibility of much higher rates for a long time. Not every company has had to refinance so far, not every private equity company has met a hostile reception in the credit markets, and not every country has had to face the consequences of a potentially ruinously high national invoice for interest expense. All this is still in the making. So I’m not so quick to believe that this rise in rates, as dramatic as it has been, is going to be solitary or helpful just to savers. No, I think it’s a much, much deeper phenomenon and we’ll learn more about it in the coming fiscal quarters and years. That’s for sure.
With the crisis facing British pension funds and the collapse of Silicon Valley Bank, we have already seen two situations with major turmoil. Do you expect further stress in the system?
Who knows, but the protracted selloff in US treasuries is properly raising concerns that the March regional banking crisis never ended but only took the summer off. All-time low interest rates beguiled, seduced and even coerced people into doing things they would not have done perhaps except for interest rates that were not the product of the marketplace but rather the product of the models of the central bankers of the world. The problem with 4%, 5% and 6% interest rates today is not 4%, 5% and 6% on their face. The real problem is the preceding regime of zero percent rates, and the debt accumulation that those rates fostered and brought into being.
Then again, interest rates could also fall again. Or to put it another way: What are the specific forces that could foster a long bear market in bonds?
One cause might be an embedded, what they call, structural inflation. If inflation is part of the times, the spirit of the age, that could be one driver. Another cause could be a deterioration of public credit. For a long time, the United States has been in the privileged position of being the one and only superpower and the issuer of the one and only reserve currency of the world. But in its humanity, America is not so very different from other countries.
What do you mean by that?
Essentially, the privilege of consuming much more than you produce is sort of the poisoned chalice gift of a reserve currency. It’s like saying: All right, you can pay your bills in your currency you alone can produce and the world will accept it because of your evident strength and enterprise and power. If Uganda, Britain, Singapore or even Switzerland was given this privilege, I imagine any other country would have done the same. But what we have done in America is that we brought up immense net international debts and very large domestic sovereign debts. So altogether a lot of debts, financed with the dollar which – as we convinced ourselves – is kind of the Coca-Cola or Microsoft of monetary world brands. That’s a very seductive thing to have come to believe.
So the dollar as the world’s reserve currency is proving to be a curse?
When we speak about the troubles in public credit, that’s another way of saying there are more bonds on offer than are demanded at prevailing rates of interest. The United States has been downgraded by Standard & Poors’ and by Fitch, and Moody’s maybe would prefer to do the same. America is a Triple-A country in many respects. The Statue of Liberty, the Declaration of Independence, you can’t downgrade those. It’s part of the whole business model of this country, and it’s a pretty good business model. But financially speaking, we have taken advantage of these things; the things that make America truly what it is – not the financial gimmicks that make us more encumbered than we ought to be.
Nevertheless, the US economy is doing remarkably well by international comparisons. This is despite the fact that virtually everyone had feared that the economy would cool down significantly as a result of rising interest rates.
I thought that combination of an inverted yield curve and the contraction of monetary growth together were pretty strong signals of a pending recession. So again, it turns out there are no surefire indicators. But obviously, a recession will come at some time, and I think it will have its origins in the unhealthy capital structures caused by the suppression of interest rates and the distortion that suppression has brought about over the course of more than a decade. To me, that’s going to be the proximate cause of the next financial difficulties, being part and parcel of the next recession.
What is the best way to navigate this environment as a European investor based in Zurich, for example?
I would think that you would continue to look at companies in a company-by-company way. However, you would not be ignorant of the fact that the spread between the American equity market cap and the market cap of the rest of the world is at a record high. So everyone owns America already, and has been well paid for that. But it’s a big world, and there might be opportunities elsewhere as well as in America.
Where else do you spot attractive opportunities for investments?
Here’s a question: When you’re looking around for a currency, if you want to hold money in some form, are you really sure you want to hold it in dollars, or in competing fiat currencies? In this regard, I might have mentioned gold once or twice before in our previous conversations. So I would say to the gnomes of Zurich: Don’t forget what got you here! Don’t turn your little backs on gold. But seriously, I think that gold is going to have its day. It really has not had its day yet, as I see it.
Gold has experienced a strong surge in recent weeks. What speaks for further gains?
I think gold ought not to trade as an inflation hedge, but as an investment in monetary disorder of which we surely have enough in the world. So it’s a question of getting people interested in the problem, and then in the solution. If you want to go back and look at the long cycles, it might just be that the fifty odd years since the end of Bretton Woods and the end of the dollar’s convertibility to gold, that that cycle is ending. It might be that paper money in the historians’ retro perspective views will seem to have been a failure and that the world is going to charge back on unconstrained central bank credit creation and unconstrained sovereign borrowing. Maybe, that’s one way to look at it. It’s the way I tend to look at these things: longer-term, historical trends – and fifty years in the history of money is about the blink of an eye.
Influencers currently yield the biggest power over people’s purchasing decisions in Brazil, China and India, according to the survey which is representative of the countries’ online populations.
While influencers’ sway has only become larger in Brazil and India, it has recently decreased in China, but stayed on a high level nonetheless.
In most other countries, the trend to follow influencers’ lead when deciding on a purchase gained traction.
Denmark and Japan were among the countries paying influencers little mind, even though their following was growing in these nations also.
Among Europeans, Italians were most “under the influence”, at 24 percent saying in 2023 that they had made a purchase because a celebrity or influencer advertised the product.
Below is my column in The Messenger on the renewed effort of Special Counsel Jack Smith to gag former President Donald Trump.
At the same time, Judge Arthur Engoron has repeatedly fined Trump for his public statements about the New York fraud case. Engoron declared this week “Anybody can run for president. I am going to protect my staff.”
There is widespread support for barring attacks on court staff and Trump did attack the Court’s clerk in a prior posting. However, most of his comments have been directed at Engoron and his alleged hostility toward Trump. Where to draw this line is the subject of this column. In my view, criticism of the case, the court, and the prosecutor should be treated as protected speech.
Here is the column:
In 2016, the Supreme Court issued a unanimous opinion overturning a conviction that the Department of Justice (DOJ) had seemed willing to secure at whatever cost to the rule of law. The case involved the prosecution of former governor Bob McDonnell (R-Va.), and the lead DOJ prosecutor was now-special counsel Jack Smith. The court dismissed the “tawdry tales” offered by the DOJ and declared that it was far more concerned with the damage that Smith was causing to the legal system with his virtually limitless interpretation of criminality.
The rebuke came to mind this week as Smith continued his unrelenting effort to gag former president Donald Trump before the 2024 election. Some of us have previously denounced the gag order issued by U.S. District Judge Tanya S. Chutkan as unconstitutional, but even that order was more limited than what Smith had demanded.
Even the American Civil Liberties Union (ACLU), a leading critic of Trump, has come out against Smith’s efforts as an attack on the First Amendment.
Undeterred, Smith now wants to reinstate and expand the gag on Trump, citing Trump’s comments about his former chief of staff, Mark Meadows, who reportedly has been given an immunity deal by Smith. (Meadows’ lawyer disputes those reports.)
Smith wants to bar Trump from criticizing any witnesses as well as the prosecution and the court. That would include criticisms of former Vice President Mike Pence, currently one of his opponents for the 2024 Republican presidential nomination, on his allegations linked to the earlier election.[Update: after this column ran, Pence withdrew from the presidential campaign]
Of course, gagging Trump will not materially affect the jury pool in the case. The Smith prosecutions are one of the biggest issues in this election. Moreover, it will not protect potential witnesses from withering criticism in the middle of an election that could turn on the public view of these cases.
Indeed, Smith has insisted on trying Trump before the election but now also wants to prevent him from speaking fully about the case before the election. Trump alone would be gagged, even as other politicians and pundits debate the merits of the cases and the countervailing allegations of the weaponization of the criminal justice system.
The prior order issued by Judge Chutkan is shockingly vague and overbroad. It bars Trump from “targeting” Smith or his staff or potential witnesses or the “substance of their testimony.” It leaves an undefined and uncertain line as Trump campaigns on what he (and millions of citizens) view as the abuse of the criminal justice system to target President Biden’s main political opponent.
Smith would add to the scope and ambiguity of the order in his latest motion. He is arguing that the court should “modify the defendant’s conditions of release … by clarifying that the existing condition barring communication with witnesses about the facts of the case includes indirect messages to witnesses made publicly on social media or in speeches.”
Consider that for a moment: Smith would treat comments about witnesses, such as Meadows or Pence, as an effort to communicate with a witness.
Thus, Smith continues to litigate with a sense of utter abandon, showing his signature lack of concern for the implications of his legal arguments. It is the type of blind purpose that leads — as it did in the McDonnell case — to a unanimous ruling against you on an otherwise divided Supreme Court.
Ironically, it calls for a level of self-restraint that the trial court itself failed to show in the past. In sentencing a rioter in 2022, Judge Chutkan said that January 6 defendants “were there in fealty, in loyalty, to one man — not to the Constitution.” She added that it was “a blind loyalty to one person who, by the way, remains free to this day.”
Despite clearly indicating with her comment that she believed Trump should be jailed (long before he was indicted), Chutkan has refused to recuse herself in this trial.
The lack of restraint shown by Smith only magnifies the lack of leadership from Attorney General Merrick Garland. The attorney general has repeatedly said that he would give the special counsel full authority and independence. However, that would not ordinarily mean that the attorney general would reduce himself to a mere pedestrian in this process.
This is an example of the ever-shrinking profile of Garland at the Justice Department. He has often told Congress that his knowledge of controversies is limited to what he has read in press accounts. Even beyond the special counsel’s investigations, he seems as proactive as a ficus plant.
Yet, this new gag motion presents a far more serious cost to Garland’s passive role at the department. Smith is taking a hatchet to the First Amendment in these motions. In doing so, he is fueling anger over the perception of a weaponized criminal justice system.
Smith’s deafening attacks on free speech are matched equally by Garland’s utter silence. The attorney general seems to believe that removing himself entirely from these investigations is more important than guaranteeing that his department does not become the enemy of core constitutional rights.
As Smith seems intent on inviting another unanimous Supreme Court opinion against his department, Garland may want to consider voicing a modicum of concern over the cost to free speech in Smith’s efforts to gag Donald Trump.
Attacks On US Bases In Syria Continue Unhindered After Pentagon’s Friday Airstrikes
Attacks on US military outposts in Iraq and Syria have continued over the weekend. Al-Mayadeen news and other regional outlets have reported that there have been several attacks by Iran-backed militias on Saturday and Sunday. Russian media has also reported on the fresh attacks, calling recent Pentagon airstrikes on Syria an “unsuccessful bid to deter the militias.”
A statement by a coalition of Shia paramilitary groups said, “The Mujahideen of the Islamic Resistance in Iraq targeted the American occupation base in Al-Tanf, Syria, with two drones, which directly hit their targets.” They carried out the attack from just across the Iraq border into Syria.
Reports say separately that the al-Shaddadi base in eastern Syria was also hit with two drones, and al-Omar base and oil field was struck. The latter was reportedly attacked a mere hours after the US airstrikes.
Al-Mayadeen had says ago cited a statement from the Iraqi Hezbollah Brigades which said the group is willing to fight “a war of attrition against the enemy that will extend for years.”
In the early hours of Friday, the US had sent fighter jets to attack multiple locations of Iran-linked paramilitaries in Syria. The Associated Press summarized the action based on US official statements as follows:
Air Force Brig. Gen. Pat Ryder said Friday that the strikes near Boukamal by F-16 and F-15 fighter aircraft targeted a weapons storage facility and ammunition storage facility used by the IRGC and affiliated groups. “Both facilities were destroyed,” he said. “We currently assess there were no casualties in the strikes.”
“These precision self-defense strikes are a response to a series of ongoing and mostly unsuccessful attacks against US personnel in Iraq and Syria by Iranian-backed militia groups,” US Defense Secretary Lloyd Austin said in the aftermath.
“Iran wants to hide its hand and deny its role in these attacks against our forces. We will not let them. If attacks by Iran’s proxies against US forces continue, we will not hesitate to take further necessary measures to protect our people,” he added.
Iraqi Shia militias have released a video of them launching a suicide drone toward a U.S. military base.
A Palestinian flag is showed on the drone before it is launched.
More than 20 U.S. soldiers have been wounded in recent attacks on military bases in Syria and Iraq. pic.twitter.com/OB7VHDGsyb
But given the rocket and drone attacks have continued into the weekend, it’s become clear that these US strikes didn’t have the desired deterrent effect.
US spy plane fights along the eastern Mediterranean, including stepped up drone activity, have increased in relation to Israel’s ongoing ground assault on Gaza.
That’s because Teanne Ewings has to run against a boy who identifies as a girl.
“When I was in high school, even the thought of a transgender athlete being in my race was not even on my radar,” 21-year-old Teagan Ewings told The Epoch Times.
But much has changed in school sports.
Even just a year ago, a 16-year-old cross-country runner from Maine Coast Waldorf School (MCWS), ran as a boy.
He placed 172nd in the state men’s cross country during his freshman year.
But then he grew his short hair out and transitioned to women’s cross country. Now, his running times allow him to be considered one of the state’s top girl runners.
In a meet on Oct. 5, he won the 5K (3.1 mile) race with a time of 18:09, beating the second-place girl, Emma Young, by 66 seconds.
As of Sept. 26, he ranked fifth in the state among all women and third among the state’s small-school athletes, according to online rankings by Maine track and cross country time website MileSplit.
Teanne Ewings ranks second overall and second in the state’s division for small-school athletes.
The Epoch Times attempted to contact the male runner, but his Instagram is private. His profile picture shows a crying child, along with the Pride flag and transgender pride flag.
The Epoch Times contacted MCWS but received no comment by publication time.
The Maine Principals Association (MPA) emailed The Epoch Times a statement that state law requires them to include him in women’s sports.
“The Maine Principals’ Association is committed to working with schools across the entire state to ensure that Maine State Law is followed,” the MPA’s statement reads.
“The state of Maine recently enacted laws that explicitly prohibit ‘Unlawful educational discrimination in schools based on sex, sexual orientation, gender identity, a physical or mental disability, ancestry, national origin, race, color, or religion.'”
Teagan Ewings said her sister’s peers are divided about whether a boy who identifies as a girl should participate in women’s cross country.
Some girls told her sister to “run faster” and said sports are all about having fun, she said.
“They just want everyone to have fun, and everybody can do what they want.”
End of Women’s Sports?
Other women see the inclusion of boys as the end of women’s sports.
“There’s just not going to be female sports anymore,” Teagan Ewings said. “It’ll just be male sports and then males pretending to be females.”
Local parent Cathy Ross has concerns about this, too.
High school boys have far better running times than women, she said.
“There’s a handful of us moms who have seen our daughters work like crazy,” she said. “These are kids who run over 40 miles a week. Sometimes, at the height of their season, they give up their Saturdays, so that they can travel two-and-a-half hours to a meet far away.”
After all of the effort and sacrifice, losing to a man is “crushing” for the girls, Ms. Ross said.
Currently, the young male beats the girls he runs against by two minutes. He’s several inches taller than the girls he competes with.
Scientific studies show male hips give men a more efficient running stride than women. Testosterone also allows men to build more muscle than women.
Basically, biology means that he has a larger heart, more leg muscle, larger lungs, and stronger bones than the girls he competes with, Ms. Ross said.
Allowing him into women’s sports amounts to Maine giving a special privilege to a man over every girl in the state, she said.
“I don’t understand why the gender identity of one individual, and trying to validate that, is seen as far more important than the hard work and the efforts and the need to compete fairly and honestly and to achieve success for girls,” Ms. Ross said.
More Male Physical Advantages
Katherine Collins has a son and daughter in cross country, she said.
The female-identifying runner “is going to get faster because he’s getting older,” she said. “All he did was grow his hair out and put braids in his hair. I mean, that’s all he did. He didn’t have to prove anything” to be allowed to compete as a girl.
No matter how much training they endure and dedication girls bring, it’s not enough to beat the testosterone advantage, Ms. Collins said.
“The fastest boys’ 5K time in Maine is more than two minutes faster than the fastest girls,” she said. “There’s just no comparison.”
Friends have confessed to her that their daughters don’t want to compete anymore because they know they’ll lose, she said.
And she’s frustrated hearing “people say, ‘Oh, well, they should just work harder,'” she said. “It’s impossible. It’s physiologically impossible.”
Letting men enter women’s sports likely will cost a generation of children their shot at competitive athletics, said Marshi Smith, a former NCAA women’s swimming champion,
“How many girls are going to be sacrificed in the meantime?” she asked rhetorically during an interview with The Epoch Times.
“My daughter is 7 right now. In 10 years, that will be her entire childhood athletic career.”
For some female students in Maine, the male runner’s victories will rob them of accolades that could affect their college applications, Ms. Collins said.
“If you’re applying to college and you say that you’re nationally ranked or a state champion, that is a big deal,” said Ms. Collins.
So his inclusion is a “slap in the face” to female athletes, Ms. Collins said.
“The MPA doesn’t care about girls,” she said. “They don’t care about women.”
Rules Allowing Men Versus Women
Parents in Maine opposed to allowing a boy to compete as a girl have few options to change the situation, Maine parental rights advocate Shawn McBreairty told The Epoch Times.
But parents can file complaints with their local school district citing Title IX, the landmark U.S. law meant to bring equity between men and women in most facets of education, Mr. McBreairty suggested.
If that doesn’t change things, they can consider filing lawsuits, he said.
Although the boy didn’t crack the top 100 of Maine’s male runners, he’s one of the best “female” runners in the state, Mr. McBreairty said.
The MPA’s handbook includes the word “gender” 39 times and the word “transgender” nine times.
“The MPA supports student-athletes regardless of their gender identity or expression,” the handbook reads. “The MPA also recognizes that high school sports teams have traditionally been binary [single sex] and believes that it is important to continue to offer single-sex interscholastic athletic teams in order to ensure equal athletic opportunities for girls.”
The handbook also states that “most high school-aged boys have a distinct athletic advantage” over girls.
The MPA’s Gender Identity Equity Committee (GIE) can decline a request for cross-sex competition—when a boy who identifies as a girl asks to compete with girls—if members are convinced the student is only pretending to be transgender, the handbook reads.
The GIE committee makes this decision under a long list of criteria.
Some criteria involve physical traits like height, weight, previous athletic performance, and whether a student has passed puberty.
Other criteria include whether the student has consistently identified as transgender, whether a student has already changed their gender identity in school records, and what sports the student plans to do.
However, no test can determine if someone is transgender because “gender identity is an internal identification and experience,” according to guidelines from the World Professional Association for Transgender Health (WPATH).
The MPA handbook also states that the committee can decline a student’s request to play on opposite-sex teams if the student would gain an “unfair athletic advantage or pose an unacceptable risk of physical injury to other student-athletes.”
Parents wonder how the current case, in which one participant jumped more than 100 places up in ranking when switching to compete as a girl, can be within the bounds of fairness by the MPA’s standards.
“They’re acknowledging that boys have an athletic advantage,” Ms. Ross said.
“Basically, they don’t intend to do anything about it.“
Watch: Muslim Rioters Storm Airport, Surround Rumored Flight From Israel, In Southern Russia
There are shocking and surreal scenes coming out of the southern Russian Republic of Dagestan, after word spread that a flight from Tel Aviv was set to land at its international airport.
Rumors that a flight full of Israeli Jews was set to land triggered Muslim mobs to raid the airport, where they broke past barriers and even at one point stormed the airstrip in search of Jews.
“A flight from Israel to the Russian Republic of Dagestan earlier today was forced to divert from its intended destination in the capital of Makhachkala after pro-Palestinians protesters stormed the airport, seeking to attack the Israeli arrivals, according to multiple reports,” Times of Israel(TOI) described of the chaotic scene.
Several videos have emerged showing angry rioters yelling “Allahu Akbar” while seeking to intercept offboarding passengers from the Israeli flight.
A Russian Pilot telling Passengers on a Plane at Makhachkala International Airport in Dagestan to not attempt to Open any of the Doors due to the Rioters on the Tarmac which are trying to enter the Aircraft. pic.twitter.com/lwTW0Zg3V6
It appears police or security personnel were nowhere in sight as the mob, reportedly mainly made up of Palestinians who live in Dagestan, rampaged through the terminal.
“Dagestan’s population is overwhelmingly Muslim,” TOI noted. “According to Channel 12, the crowd was apparently largely made up of Palestinian expats.”
The flight from Tel Aviv either diverted or took off after briefly landing. There are reports that the mob tried to break into a plane on the tarmac. Some reports say that the aircraft which was surrounded was full of Russian citizens.
Regional media said the group went so far as to begin checking the IDs of travelers exiting the airport by car:
Some of the signs held by demonstrators read “Child killers have no place in Dagestan” and “We are against Jewish refugees.”
The independent Medizona news website reported that the demonstration was prompted by calls spread on the Telegram messaging app earlier on Sunday to block a plane scheduled to arrive directly from the Israeli city of Tel Aviv.
According to local media, some of the demonstrators were stopping cars outside Makhachkala’s airport to check the personal identification documents of drivers and passengers as they searched for Israeli citizens among the motorists.
The flight from Tel Aviv landed at 7:17 p.m. local time, according to the airport’s website, after which the protesters stormed into the airport, breaking past security and running onto the tarmac.
One group of people who ran onto the airport’s tarmac surrounded a plane and jumped onto one of its wings, the pro-Kremlin newspaper Izvestia reported.
The FT’s Moscow correspondent Max Seddon wrote of one video, “Remarkable to see security forces in Russia standing by for so long. By now, according to Baza, police in Makhachkala have chased them off the runway and outside the airport, where they are now protesting.”
The Dagestan airport was forced to temporarily close as the military and police belatedly tried to gain control of the situation and restore order. Per regional N12 News:
“Security official: the event in [Dagestan] is not over yet. A relatively small number of Israelis and Jews are isolated and secured at the airport. We are working for them to take off from there for an onward flight to Moscow as soon as the conditions allow.”
When word spread that a plane from Tel Aviv was landing in Dagestan, Russia, a mob stormed the airport in what can only be described as a modern-day pogrom. pic.twitter.com/1G6phfdraz
Some observers are speculating that security forces essentially turned a blind eye and allowed the disturbing scene to happen.
It is indeed remarkable that given the typical high security nature of international airports, the mob so easily breached all security checkpoints and overwhelmed both the terminal and tarmac.
