Lightnews — Scholar-powered news

Matt Peterson @mattpeterson.bsky.social · 4h

WSJ is leading with *three* stories about how gold prices are exploding as investors look for way to hedge against exposure to cracks in the political system. That and old-fashioned speculation.

Screenshot of the WSJ app, showing three stories about gold’s sharp rise. Text:

=
WSJ
A New Wall Street Trade Is Powering Gold and Hitting
Currencies
Investors are pouring money into dollar alternatives like bitcoin and precious metals.
• 137 October 7 • 5 min read
CAPITAL ACCOUNT | GREG IP
Gold Rally Points to Eroding Faith in Central Banks Worldwide
In Japan, as in the U.S., a new leader wants the central bank to make government debt more bearable, which could feed inflation.
门13 October 8
• 6 min read
• LIVE
Gold Pushes Further Past $4,000
22 min ago
31 min ago
Silver Prices Eye
1980 All-Time High;
Gold Hits Another
Record
How Healthy Is the Labor Market?
Hora's What the
wsj.com
cial Data Says.
1h.
BI
Ta

1

Matt Peterson @mattpeterson.bsky.social · 19h

Trump Fed appointee Steve Miran today said a shrinking deficit is one of his reasons to support lower interest rates. If the Trump administration is pulling tariff revenue for WIC, farm aid, etc., then it isn't going to deficit reduction. He's going to have a tough time winning that argument.

1 8

Matt Peterson @mattpeterson.bsky.social · 21h

A large beneficiary of of DAC subsidies is Occidental Petroleum, which hopes to use the carbon it captures to help pump more oil.

heatmap.news/politics/doe...

Trump to Cancel Direct Air Capture Hubs in Texas, Louisiana

A new list of grant cancellations obtained by Heatmap includes Climeworks and Heirloom projects funded by 2021 infrastructure law.

heatmap.news

1 2

Reposted by Matt Peterson

Bobby Kogan @bbkogan.bsky.social · 1d

Are furloughed federal employees entitled to backpay?

The short answer is yes furloughed federal employees are entitled to backpay, but the mechanism a little complicated.

And, importantly, it means the House GOP CR is insufficient for reopening the govt & needs to be amended.

Thread explaining:

Scoop: White House memo says furloughed federal workers aren't entitled to backpay

A move to deny backpay to up to 750,000 furloughed workers would dramatically escalate Trump's pressure on Democrats to end the shutdown.

www.axios.com

8 100 250

Matt Peterson @mattpeterson.bsky.social · 23h

Yes, another version of the same threat.

1

Matt Peterson @mattpeterson.bsky.social · 23h

Sadly, you still have to pay taxes during a shutdown, so it won't make a default any more likely.

1

Matt Peterson @mattpeterson.bsky.social · 23h

Q: Should furloughed workers be repaid?

DJT: “I would say it depends on who we’re talking about...For the most part we’re going to take care of our people. There are some people that really don’t deserve to be taken care of, and we’ll take care of them in a different way.”

1 2 6

Matt Peterson @mattpeterson.bsky.social · 23h

The stock market is ignoring the shutdown, and I don't think that's likely to change quickly. But not repaying furloughed employees—as Trump just suggested—is the sort of thing that would chip away at it. It's easy to ignore easily reversed damage. Once it starts looking permanent, that's different.

2 1 15

Reposted by Matt Peterson

Robin Brooks @robin-j-brooks.bsky.social · 1d

Every day gold prices are making a new high. And every day Switzerland's convenience yield - the ability to issue debt more cheaply than others when hedging foreign yields back into Swiss Francs - makes new lows. The world is running out of safe havens. Switzerland kept its debt low and now wins...

1 6 18

Matt Peterson @mattpeterson.bsky.social · 1d

Miran says the Fed may have difficulty judging tariff inflation during the shutdown. "That's hard to do without inflation data from the government. There are some private sources for prices, but I don't know that they're really reflective of the consumption bundles that people actually consume."

2

Matt Peterson @mattpeterson.bsky.social · 1d

Steve Miran says at an industry event there can be a "penalty from the bond market" if the Fed makes the wrong rate decision. Hence long rates rose after the jumbo 2024 cuts Miran says.

This is a key argument for Trump Fed folks: You can reduce long rates by swapping Powell for a "credible" chair

1 1 3

Matt Peterson @mattpeterson.bsky.social · 1d

SEC Chair Paul Atkins the shutdown has delayed plans for a proposal to shift public companies from quarterly to semiannual reporting. "We'll see, maybe next year,"

2 3 6

Matt Peterson @mattpeterson.bsky.social · 2d

I know these details are tiresome, but Japan did not, in fact, just elect its first female prime minister. Sanae Takaichi was elected leader of the Liberal Democratic Party and is *expected to become* prime minister. But someone else is in that job right now.

DJT post on Truth Social: "Japan has just elected its first female Prime Minister, a highly respected person of great wisdom and strength. This is tremendous news for the incredible people of Japan. Congratulations to all! President Donald J. Trump"

1 8 33

Matt Peterson @mattpeterson.bsky.social · 3d

Call me, Kevin.

2

Matt Peterson @mattpeterson.bsky.social · 3d

Hassett appears to be doing the rounds. It has been rare for him to do anything other live TV hits, which tend to be an admin favorite because they can deliver quick soundbites without much follow-up. Now he's doing podcasts, public speeches...

What has changed? IDK, but Fed decision is imminent.

David Wessel @davidmwessel.bsky.social · 3d

In case you're no longer on X...

1 6

Reposted by Matt Peterson

City Nolan @ndhapple.bsky.social · 5d

For everyone stuck writing about today’s cancellations, here’s the metadata from the “rule” that Vought claims both New York and Chicago are somehow in violation of. The PDF to post it wasn’t even created until 5:47pm, was last modified at 5:55pm. And the government shut down six hours later at 12am

1 26 100

Matt Peterson @mattpeterson.bsky.social · 6d

US farmers are furious that the Treasury is bailing out Argentina, which competes with the US on soybean sales.

The Soybean Farmers of our Country are being hurt because China is, for “negotiating” reasons only, not buying. We’ve made so much money on Tariffs, that we are going to take a small portion of that money, and help our Farmers. I WILL NEVER LET OUR FARMERS DOWN! Sleepy Joe Biden didn’t enforce our Agreement with China, where they were going to purchase Billions of Dollars of our Farm Product, but Soybeans, in particular. It’s all going to work out very well. I LOVE OUR PATRIOTS, AND EVERY FARMER IS EXACTLY THAT! I’ll be meeting with President Xi, of China, in four weeks, and Soybeans will be a major topic of discussion. MAKE SOYBEANS, AND OTHER ROW CROPS, GREAT AGAIN!

11

Matt Peterson @mattpeterson.bsky.social · 7d

The court's decision to allow Lisa Cook to stay on, for now, means the Trump administration can only be sure it will gain one Fed governor seat. Miran doesn't expect to stay. Bessent insists Powell will leave, but he can't be sure. There's now no reason to wait to announce the Fed chair replacement.

2 7

Matt Peterson @mattpeterson.bsky.social · 7d

Argentine peso continues to slide amid the Bessent intervention. The mail bailout mechanism (Exchange Stabilization Fund) is open despite the shutdown.

Line chart of the Argentina peso versus the US dollar, which shows a sharp strengthening of the currency when the bailout was announced, but a weakening in the past few days.

3

Matt Peterson @mattpeterson.bsky.social · 7d

Would be a lot easier to write off the rough ADP number if we had BLS jobs data on Friday
www.barrons.com/articles/adp...

U.S. Sheds 32,000 Private Sector Jobs in September, According to ADP

Economists surveyed by FactSet expect that the U.S. private employers added 50,000 jobs in September.

www.barrons.com

2 8

Matt Peterson @mattpeterson.bsky.social · 7d

Ironically, had they managed to confirm a BLS commissioner, he would be the only person working at the agency during the shutdown.

3

Matt Peterson @mattpeterson.bsky.social · 7d

I think he just dropped the “and” speaking off the cuff. He wasn’t saying BLS is in Commerce.

1

Matt Peterson @mattpeterson.bsky.social · 7d

I don’t think I can explain exactly how Warsh gets from ending QE to lowering, eg, mortgage rates. So I’ll let him explain himself. Here’s the full (long) quote.

Note that when he’s talking about “the world in which we live,” he’s talking to a room full of well-heeled investors.

Financial conditions in the world in which we live, they seem really quite accommodative. Credit spreads are as low as they've been almost in history. Public markets are open for debt and equity issuers. So you would say, I wonder why that is. I'd say part of that is because you're carrying around $7 trillion in the balance sheet the Fed. That's one of your monetary tools. QE works, as Jim [Grant] suggested, first through financial assets, and then will find its way and transmit itself to the real economy. Interest rates are different. We have a lot more experience in interest rates. They hit the real economy first. So I see two economies are out there, each being given a different bit of monetary medicine. Monetary medicine is highly accommodative to the world which so many of us live, but it's not so accommodative on Main Street.

So I am sympathetic to the call from some who say interest rates can be made lower. And I would say that is of piece with the balance sheet can be made smaller. If we can target the real side of the economy where real people work and are still trying to get their head above water, then we can end up with lower rates than we currently have. Indeed, a new organizational framework with new data, a new framework for quantitative easing, a new understanding with the Treasury Department. We can do that so we can achieve a stronger, more robust economy and, get this, lower prices.

7

Matt Peterson @mattpeterson.bsky.social · 7d

"The currency fell more than 6% Tuesday, its biggest intraday drop since Sept. 8, before the government sold dollars in the spot market"

Milei’s Government Sells Dollars as Peso Starts to Sink Again

Argentina’s peso is coming under attack again, forcing the government to intervene to keep it from plunging just days after a show of US support had propped up the country’s financial markets.

www.bloomberg.com

1 5

Matt Peterson @mattpeterson.bsky.social · 7d

Warsh’s comments went over a lot better with the conservative financial crowd than Bessent’s did last year. SB spoke at the same event and ended up in a shouting match with some people in the audience.

7