London Irvine Report: Special Update 23/08/2025 Fed Chairman Powell Kow Tows.

Baltic Dry Index. 1944 +51 Brent Crude 67.73

Spot Gold 3372 U S 2 Year Yield 3.68 -0.11

US Federal Debt. 37.266 trillion

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When the final result is expected to be a compromise, it is often prudent to start from an extreme position.

John Maynard Keynes

In the weasel words of central bankster speak, it was President Trump 10 Fed Chairman Powell 0.

Prepare for a highly politicised US central bank and weaker US dollar.

Get gold and silver.

Powell indicates conditions ‘may warrant’ interest rate cuts as Fed proceeds ‘carefully’

Published Fri, Aug 22 2025 10:00 AM EDT Updated Fri, Aug 22 2025 3:58 PM EDT

Federal Reserve Chair Jerome Powell on Friday gave a tepid indication of possible interest rate cuts ahead as he noted a high level of uncertainty that is making the job difficult for monetary policymakers.

In his much-anticipated speech at the Fed’s annual conclave in Jackson Hole, Wyoming, the central bank leader in prepared remarks cited “sweeping changes” in tax, trade and immigration policies. The result is that “the balance of risks appear to be shifting” between the Fed’s twin goals of full employment and stable prices.

While he noted that the labor market remains in good shape and the economy has shown “resilience,” he said downside dangers are rising. At the same time, he said tariffs are causing risks that inflation could rise again — a stagflation scenario that the Fed needs to avoid.

With the Fed’s benchmark interest rate a full percentage point below where it was when Powell delivered his keynote a year ago, and the unemployment rate still low, conditions allow “us to proceed carefully as we consider changes to our policy stance,” Powell said.

“Nonetheless, with policy in restrictive territory, the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance,” he added.

That was as close as he came during the speech to endorsing a rate cut that Wall Street widely believes is coming when the Federal Open Market Committee next meets Sept. 16-17.

However, the remarks were enough to send stocks soaring and Treasury yields tumbling. The Dow Jones Industrial Average showed a gain of more than 600 points following the public release of Powell’s speech while the policy-sensitive 2-year Treasury note saw a 0.08 percentage point fall to around 3.71%.

In addition to market expectations, President Donald Trump has demanded aggressive cuts from the Fed in scathing public attacks he has lobbed at Powell and his colleagues.

The Fed has held its benchmark borrowing rate in a range between 4.25%-4.5% since December. Policymakers have continued to cite the uncertain impact that tariffs will have on inflation as a reason for caution and believe that current economic conditions and the slightly restrictive policy stance allow for time to make further decisions.

Importance of Fed independence

While not addressing the White House demands for lower rates specifically, Powell did note the importance of Fed independence.

“FOMC members will make these decisions, based solely on their assessment of the data and its implications for the economic outlook and the balance of risks. We will never deviate from that approach,” he said.

The speech comes amid ongoing negotiations between the White House and its global trading partners, a situation often in flux and without clarity on where it will end. Recent indicators show consumer prices gradually pushing higher but wholesale costs up more rapidly.

From the Trump administration’s view, the tariffs will not cause lasting inflation, thus warranting rate cuts. Powell’s position in the speech was that a range of outcomes is possible, with a “reasonable base case” being that the tariff impacts will be “short lived — a one-time shift in the price level” that likely would not be cause for holding rates higher. However, he said nothing is certain at this point.

“It will continue to take time for tariff increases to work their way through supply chains and distribution networks,” Powell said. “Moreover, tariff rates continue to evolve, potentially prolonging the adjustment process.”

In addition to summarizing the current conditions and potential outcomes, the speech touched on the Fed’s five-year review of its policy framework. The review resulted in several notable changes from when the central bank last performed the task in 2020.

At that time, in the midst of the Covid pandemic, the Fed switched to a “flexible average inflation targeting” regime that effectively would allow inflation to run higher than the central bank’s 2% goal coming after a prolonged period of holding below that level. The upshot is that policymakers could be patient with slightly higher inflation if it meant insuring a more comprehensive labor market recovery.

However, shortly after adopting the strategy, inflation began to climb, ultimately hitting 40-year highs, while policymakers largely dismissed the rise as “transitory” and not needing rate hikes. Powell noted the damaging impacts from the inflation and the lessons learned.

“As it turned out, the idea of an intentional, moderate inflation overshoot had proved irrelevant. There was nothing intentional or moderate about the inflation that arrived a few months after we announced our 2020 changes to the consensus statement, as I acknowledged publicly in 2021,” Powell said. “The past five years have been a painful reminder of the hardship that high inflation imposes, especially on those least able to meet the higher costs of necessities.”

Also during the review, the Fed reaffirmed its commitment to its 2% inflation target. There have been critics on both sides of the issue, with some suggesting the rate is too high and can lead to a weaker dollar, while others seeing a need for the central bank to be flexible.

“We believe that our commitment to this target is a key factor helping keep longer-term inflation expectations well anchored,” Powell said.

Powell indicates conditions 'may warrant' interest rate cuts as Fed proceeds 'carefully'

Trump says he’ll fire Fed Governor Lisa Cook ‘if she doesn’t resign’

Published Fri, Aug 22 2025 10:23 AM EDT Updated Fri, Aug 22 2025 12:15 PM EDT

President Donald Trump said Friday he will fire Federal Reserve Governor Lisa Cook if she does not resign from her position.

“What she did was bad,” the president told reporters who asked about Cook, an appointee of former President Joe Biden who has come under fire from the Trump administration over allegations about her mortgages.

“So I’ll fire her if she doesn’t resign,” he said during a surprise visit to The People’s House, a museum of the White House.

If Trump were to successfully remove Cook “for cause,” he would get the chance to reshape the central bank’s governing board, potentially for years to come.

Two of the seven current governors, Christopher Waller and Michelle Bowman, are Trump appointees. Both dissented from the Fed’s most recent decision to hold interest rates steady.

Another seat opened up earlier this summer, when Adriana Kugler announced she would step down.

If Trump is able to remove Cook, he would appoint her successor — potentially ensuring that a majority of the board shares his view on monetary policy. Board members serve 14-year terms.

Federal Housing Finance Agency Director Bill Pulte this week publicly accused Cook of mortgage fraud related to claims that she took two different properties as her primary residence at the same time.

He sent a criminal referral to the Department of Justice, which revealed Thursday that it will investigate Cook.

Pulte, a vocal critic of Fed Chairman Jerome Powell who has aggressively backed Trump’s calls for the central bank to lower interest rates, has continuously attacked Cook on social media since revealing his allegations.

Trump previously called for Cook to resign immediately in light of the allegations. Ed Martin, a Justice Department lawyer who is widely seen as a loyalist to the president, urged Powell to promptly remove Cook — even though the central bank chief cannot do so under the law.

Sen. Elizabeth Warren, the top Democrat on the Senate Banking Committee, wrote in an X post Friday that Trump is targeting Cook because he is “trying to find a scapegoat for his failure to lower costs for Americans.”

Cook has consistently voted in line with Powell. She sided with the majority to keep rates unchanged following the Federal Open Market Committee’s most recent meeting last month.

Cook said Wednesday that she has “no intention of being bullied to step down from my position because of some questions raised in a tweet.”

Trump says he'll fire Fed Governor Lisa Cook 'if she doesn't resign'

In other news.

Canada's travel boycott of the United States is getting worse

August 21, 2025

Recent data published by Statistics Canada revealed that there has been another significant decline in the number of Canadian visits to the United States. The new figures showed that the Canadian travel boycott against its southern neighbor is still in full swing. But just how bad are things?

According to the latest data from Statistics Canada, Canadian visits to the United States dropped substantially in July, marking an intensification of the nation’s travel boycott against the US, and more worryingly, locking in more losses that American businesses will experience this year.

On August 11th, Statistics Canada published data on Canadian returns from the United States. The new data revealed that the boycott of travel to the United States was only getting worse. Travel to the US from Canada dropped by a whopping year-over-year percentage in July.

The number of Canadian residents returning to Canada by automobile in July was just a measly 1.7 million. Statistics Canada noted that this was a steep 36.9% decline from the same month last year and the seventh consecutive month of automobile return declines.

Forbes pointed out that the July automobile return numbers followed a 33% drop in June. The American business news outlet also added that air travel returns also declined by a considerable amount in July, based on Statistics Canada’s report.

In July 2025, Canadian return trips by air from the US fell by 25.8% to just 383,700. This was also the seventh consecutive month of declines in air travel returns from the United States. However, that wasn’t the worst part about what the data showed.

Forbes reported that July also marked the seventh consecutive month that automobile and air travel returns from the United States saw double-digit year-over-year declines, which in turn is having a major impact on the American economy.

According to data from Tourism Economics, which is a branch of Oxford Economics, the first six months of 2025 have seen a 24% drop in Canadian travel to the US, something that Forbes noted has resulted in a major loss for the US tourism industry.

In February 2025, the US Travel Association warned that even a 10% reduction in Canadian visitors to the United States could result in 2 million fewer visitors to the US, the loss of $2.1 billion in spending, and roughly 14,000 job losses.

Canada's travel boycott of the United States is getting worse

Global Inflation/Stagflation/Recession Watch.

Given our Magic Money Tree central banksters and our spendthrift politicians, inflation/recession now needs an entire section of its own.

Tariff Inflation Is Just Starting

By Aaron Back August 21, 2025

In May, Home Depot executives told investors that they plan to hold the line on prices despite tariffs. They even boasted that their ability to do so represented “a great opportunity for us to take share.”

Fast forward three months to their latest quarterly report, and the retailer now says “there will be some modest price movement in some categories.”

What changed? William Bastek, Home Depot executive vice president of merchandising, told analysts: “Now some of the imported goods, obviously, tariff rates are significantly higher today than they were when we spoke in May.”

That actually isn’t obvious. With all the back and forth, threats and last-minute deals, investors could be forgiven for not having a clear picture of what Home Depot’s import bills look like now compared with three months ago.

But this highlights a broader point: With all the uncertainty over tariffs, it has broadly made sense for companies to hold the line on pricing. After all, why upset customers with a price hike over a tariff that could go away in an instant?

Yet companies can’t sit on their hands forever. On Thursday, investors will be looking for more clarity from the big boy of retail, Walmart. Unlike Home Depot, it admitted last quarter that some price hikes were inevitable, but told investors to wait for their second-quarter update for fuller guidance.

Economists at Goldman Sachs, in a widely discussed note this month, shed further light on what’s happening. Looking at the first wave of tariffs against China back in February, they found that U.S. companies initially absorbed the costs, but now are passing on more to consumers. Specifically, they found that “around 36% of tariff costs were passed onto consumer prices after three months of implementation and around 67% were passed on after four months.”

This makes sense. Besides waiting for clarity on tariffs, it also takes time to negotiate new prices with suppliers and customers. And there have often been opportunities to stock up on goods before Trump’s declared deadlines. But the longer that tariffs stay in place, the more they will bleed into consumer prices.

The implications are concerning. This means the “Liberation Day” tariffs declared in April and negotiated over the past several months, as well as sector-level tariffs on things like autos, steel and so on, aren’t being fully felt yet. Goldman’s economists figure that consumers had absorbed just 22% of total tariff costs through June, but this will rise to 67% by October.

In short, don’t take too much comfort from the relatively subdued inflation seen so far. The real tariff bill is yet to arrive.

marketsam.cmail19.com/t/d-e-glhckl-ykyklyltw-r/

Technology Update.

With events happening fast in the development of solar power and graphene, I’ve added this section.

Today, the battery powered electric train. But given the fire risk, who needs a bet on a battery electric train journey?

New world record set for furthest distance travelled by battery train

Posted 20th August 2025 By Alex Bestwick

Great Western Railway today registered 200 miles on a return journey from Reading Train Care Depot which took in London Paddington (twice) and Oxford.

The previous record of 139 miles was achieved by Stadler Deutschland in Berlin in 2021.

Officials from the Rail Performance Society, an organisation dedicated to recording and studying the performance of railways and railway traction in the UK, were on board to witness and verify the new world record.

The 200-mile record was achieved operating in ‘SuperMode’ – travelling at speeds of between 30mph and 40mph and without heating. It is estimated that around 120 miles could have been achieved travelling at full speed (60mph).

Rail Performance Society Vice Chair, Nigel Smedley, said: “We can confirm that, subject to final checks, the Great Western Railway Class 230 train travelled 200 miles on a return journey from Reading Train Care Depot without charging its batteries from any external energy source.”

The Class 230 train, number 230001, is the one used for GWR’s successful trial of fast-charge technology on the Greenford branch line over the past year.

The new world record follows the release of a White Paper, published by GWR last month, outlining the findings of the trial, which proved battery trains could provide a viable and cost-effective alternative to diesel trains.

It comes as the operator prepares plans to renew its ageing regional fleet trains, which are expected to go out of serviceable use in the next 7-10 years.

GWR Engineering Director, Dr Simon Green, said: “We’re delighted to set a new world record – and to reach 200 miles in such a landmark year for the rail industry is the icing on the cake. It’s a real tribute to colleagues at GWR and Network Rail who have worked so hard on developing fast-charge technology.

“Today’s record attempt has been a bit of fun, but it also underlines a serious point: investment in battery technology is essential as we look to replace our ageing diesel fleet.

“Overhead lines will remain the first choice to power electric trains, but where that isn’t possible or desirable, battery technology like this offers a reliable and efficient alternative to bridge the gap.

“As part of our future rolling stock plans we’ll need battery trains to routinely cover over 60 miles between charges – and today’s achievement provides clear evidence that this is a viable and exciting solution for the future of our railway.”

New world record set for furthest distance travelled by battery train | The Railway Hub

Next, the world global debt clock. Nations debts to GDP compared.

World Debt Clocks (usdebtclock.org)

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This weekend’s music diversion. Mr. Handel goes highbrow setting music to Shakespeare. Approx. 7 minutes.

Handel: As steals the morn (L'Allegro, HWV 55) Amanda Forsythe & Thomas Cooley, Voices of Music 4K

Handel: As steals the morn (L'Allegro, HWV 55) Amanda Forsythe & Thomas Cooley, Voices of Music 4K

Next, more of Trump’s tariffs mischief. Approx. 5 minutes.

Trump Stunned as 50% Aluminum Tariff Backfires — 100,000 US Workers Laid Off!

Trump Stunned as 50% Aluminum Tariff Backfires — 100,000 US Workers Laid Off! - YouTube