Baltic
Dry Index. 1776 -54 Brent Crude 60.25
Spot Gold 4426 Spot Silver 75.54
US 2 Year Yield 3.47 unch.
US Federal Debt. 38.580 trillion US GDP 31.044 trillion.
Depressions and mass unemployment are not caused by the free market but by government interference in the economy.
Ludwig von Mises
Is/has President Trump dropped capitalism? If he has, what exactly will replace it?
More importantly, how would it be better than capitalism?
How will a politicised, Trump controlled US central bank, support the already declining dollar reserve standard?
What will stop gold rising to $5,000, silver to $100 probably more?
Asia-Pacific markets trade mixed as Trump rattles
defense firms and oil prices slide
Published Wed, Jan 7 2026 7:00 PM EST
Asia-Pacific markets traded mixed Thursday
after Wall Street closed lower amid rising geopolitical tensions and comments
from U.S. President Donald Trump.
U.S. defense stocks fell after Trump said
he “will
not permit” defense companies to issue dividends or stock buybacks until
they address his complaints about the industry, including executive pay
packages and production issues.
Oil prices also dropped overnight
after Trump said that Venezuela’s interim authorities would turn over as
much as 50 million barrels of crude to the U.S., raising concerns
about an increase in global supply.
Brent crude futures fell
0.51% to $60.39 a barrel, while the U.S. West Texas Intermediate crude added
0.61% to $56.33 per barrel, as of 7.30 a.m. Singapore time (Wednesday 6.30 p.m.
EST).
Japan’s benchmark Nikkei 225 index fell 0.69%,
weighed down by the basic materials and technology stocks. Among the biggest
decliners were SoftBank, which
lost 4%, and Tokyo
Electron, which provides essential chipmaking equipment to foundries that
manufacture Nvidia’s chips,
was 2.9% lower. The broader Topix index retreated 0.17%.
South Korea’s Kospi added 1.27%, while the
small-cap Kosdaq climbed 0.1%.
Australia’s S&P/ASX 200 ticked
slightly higher in volatile trading. Shares of BlueScope Steel fell 1.87%
early Thursday, after the company rejected a $9 billion takeover bid from
Australian conglomerate SGH and
U.S.-based Steel Dynamics.
Hong Kong’s Hang Seng Index declined
0.97%, led lower by losses in basic materials and technology stocks. Lenovo Group fell
3.44%, Kuaishou Technology lost
2.85%, and Baidu traded
2.76% lower. The mainland’s CSI 300 was flat.
India’s Nifty 50 fell 0.21%, while the BSE
Sensex index was 0.22% lower.
U.S. equity futures were little changed in
early Asian hours, after the S&P
500 and the Dow Jones
Industrial Average snapped a three-day winning streak.
Overnight, the broad market index shed
about 0.3% while the Dow fell 466 points, or roughly 0.9%.
The tech-heavy Nasdaq Composite gained
nearly 0.2%, aided by a 2.4% jump in Google parent Alphabet that led the
company’s market cap to surpass
Apple’s for the first time since 2019.
Asia-Pacific
markets: Nikkei 225, Hang Seng Index
Trump says he will not permit dividends and stock
buybacks for defense companies
Published Wed, Jan 7 2026 2:21 PM EST Updated
Wed, Jan 7 2026 6:36 PM EST
President Donald Trump on Wednesday
said he “will not permit” defense companies to issue dividends or stock
buybacks until those firms speed up their production of military equipment and
address his other complaints about the industry.
Trump, in a lengthy Truth Social post, also took aim at defense contractors’
executive pay packages, calling them “exorbitant and unjustifiable.”
“Defense Companies are not producing our
Great Military Equipment rapidly enough and, once produced, not maintaining it
properly or quickly,” he wrote.
Until those companies build new production
plants, “no Executive should be allowed to make in excess of $5 Million
Dollars,” Trump declared.
Shares of General Dynamics, Lockheed Martin and Northrop Grumman each fell
about 3% following Trump’s comments.
Trump later singled out Raytheon as “the least
responsive to the needs of the Department of War, the slowest in increasing
their volume, and the most aggressive spending on their Shareholders rather
than the needs and demands of the United States Military.”
He said that the Pentagon will cut its
business ties with Raytheon unless it “steps up” on investment in plants and
equipment, adding that “under no circumstances” can the company do any more
stock buybacks in the meantime.
Shares of RTX, the parent of Raytheon,
slid an additional 2% in after-hours trading after closing down 2.5%. A major
defense contractor, RTX manufactures advanced air-to-air missiles and many of
the components in the F-35 fighter jet.
It was not initially clear what impact or
binding force, if any, Trump’s announcement would have on major defense
companies’ financial activities. The White House did not immediately respond to
CNBC’s request for additional information.
Trump griped in the post that “massive”
shareholder dividends and buybacks were taking place “at the expense and
detriment of investing in Plants and Equipment.”
“This situation will no longer be allowed
or tolerated!” Trump wrote in the post, which warned the defense industry to
“BEWARE.”
“Therefore, I will not permit Dividends or
Stock Buybacks for Defense Companies until such time as these problems are
rectified — Likewise, for Salaries and Executive Compensation,” he wrote.
More
Trump: No dividends, stock buybacks for defense companies
Is This the End of American Capitalism?
If interest rates stop being market
signals and become policy decisions, what survives may look less like
capitalism—and more like permanent crisis management.
Jared
Dillian | 1.6.2026 11:46 AM
America's budget deficit is
approximately $1.8
trillion—about 6 percent of gross domestic product (GDP). This is a very
high level of indebtedness, especially given that we are running these large
deficits during an economic expansion.
Deficits usually grow during bad times, as
the government engages in countercyclical spending, such as stimulus checks,
extended unemployment benefits, and direct industry subsidies. If the deficit
is already 6 percent of GDP in good times, where will it be when the next
downturn arrives? Probably about 12 percent of GDP (or higher), which would be
the highest since World War II.
There was a sharp but brief recession
during the pandemic, and a near-recession in 2015, but the last full economic
cycle occurred in 2008, during the financial crisis. That means roughly 18
years without a full recessionary cycle.
Recessions are notoriously difficult to
predict, but we're probably closer to the next one than to the last one.
President Donald Trump appears determined to keep the economy running hot to
prevent a recession prior to the 2026 midterms, which helps explain ideas like
his tariff
rebate checks. If we do get a recession in 2026 or 2027, we may get
Keynesian stimulus spending at a level we have never seen before, adding
trillions of dollars to the debt.
Interest rates usually fall during
recessions. After 2008, for example, investors fled equities for the safety of
Treasury bonds. Even amid the engorged spending of Barack Obama's early
presidency, interest rates went down and stayed down, surprising professional
investors who expected the increased supply of bonds to drive rates higher.
Notably, the Federal Reserve began quantitative easing in November 2008 and
continued it for years—long after the initial crisis—effectively capping
interest rates. The enormous expansion of the money supply paved the way for
the great inflation of 2021–2022.
If the U.S. enters a recession and deficit
spending pushes rates higher, the Federal Reserve will likely be pressured to
implement Yield Curve Control (YCC)—buying unlimited government bonds with
newly created money to suppress interest rates. The U.S. cannot tolerate
higher interest rates: The housing market is the most unaffordable in history,
with mortgage rates at only 7 percent. If interest rates were to rise
significantly, the economy would be in checkmate. But YCC is effectively debt
monetization—the same thing that led to hyperinflationary episodes in Weimar
Germany and elsewhere. Eventually, YCC would lead to very high inflation, even
hyperinflation. But that could take several years.
This is why the next recession could mark
the beginning of the end of capitalism in the United States. High inflation or
hyperinflation has historically been associated with war, revolution, and
massive political upheaval.
More
Is
this the end of American capitalism?
In other news, Britain will continue to steal
Venezuela’s gold, raising the question, why would any country want to store
their gold in London?
Britain to keep Venezuelan gold
6 January 2026
Britain is to keep more than $3bn (£2.2bn)
in Venezuelan gold held at the Bank of England despite the ousting
of Nicolás Maduro over
the weekend.
Yvette Cooper, the Foreign Secretary, told
MPs that the UK still refused to grant formal recognition of the government in
Venezuela, meaning the country’s precious metal will remain in storage at the
Bank of England.
The Bank’s underground vaults hold the
second largest haul of gold in the world and the central banks of a number of
countries use it to store their reserves, including Venezuela.
Mr Maduro, the former Venezuelan leader,
attempted to retake the gold stored at the Bank in 2018 to prop up Venezuela’s
collapsing economy. However, the Bank refused the request because the UK did
not recognise Mr Maduro as the country’s legitimate president.
The Maduro government sued for the return
of the precious metal in 2020 but ultimately lost the case in the Supreme Court
in 2023.
The Venezuelan gold held by the Bank was
valued at around $1.95bn in 2020 but the price of the metal has nearly
doubled since
then, meaning it is now likely worth around $3.6bn.
Asked about the possibility of
repatriating the precious metal in the House of Commons on Monday, Ms Cooper
said: “Successive governments have not recognised the Venezuelan regime, which
is the basis on which the independent Bank of England took its decision.
“We continue not to recognise the
Venezuelan regime because it is important that we have the pressure in place to
have a transition to a democracy, which is also about the will of the
Venezuelan people.”
Britain and other nations including the US
had refused to recognise the legitimacy of Mr Maduro following election fraud
in 2024. Delcy Rodríguez, Mr Maduro’s deputy, was sworn in as Venezuela’s
interim president on Monday.
Ms Cooper said that “maintaining and
pursuing stability” and a “transition to democracy” were guiding the
Government’s approach to recognition.
In 2020, the UK government recognised Juan
Guaidó, the Venezuelan opposition leader at the time, as the country’s
legitimate ruler. Mr Guaidó has since fled to the United States and the UK does
not currently formally recognise any government in Venezuela.
María Corina Machado, the leader of
Venezuela’s opposition, was banned from running in the country’s 2024 election
but claims she would have won it. President Trump has declined to recognise her
authority, saying she does not have sufficient support.
“I think it would be very tough for her to
be the leader,” Trump announced at Mar-a-Lago, claiming Mrs Machado lacked
sufficient “respect” within Venezuela.
Venezuela held approximately 360 tonnes of
gold as of 2014, according to the World Gold Council, worth around $50bn in
today’s prices.
However, its hoard shrunk significantly
after 2014 as Mr Maduro, who came to power in 2013, resorted to selling off
reserves to raise hard cash to prop up the country’s economy. Venezuela stopped
reporting data on its holdings to the World Gold Council in 2018.
More
Britain to keep Venezuelan gold
Global Inflation/Stagflation/Recession
Watch.
Given
our Magic Money Tree central banksters and our spendthrift politicians,
inflation now needs an entire section of its own.
Euro zone inflation hits 2% in December, in line with forecasts
Published Wed, Jan 7 2026 5:03 AM EST
Euro zone inflation stood at 2% in December, flash
data from Eurostat showed on Wednesday.
Economists polled by Reuters had expected the
inflation rate to cool to 2%, in line with the European Central Bank’s (ECB)
target. In November, the inflation rate stood at 2.1%.
Core inflation, which excludes more volatile
energy, food, alcohol and tobacco prices, stood at 2.3% in the year to
December, down from 2.4% in November, while the annual rate of services
inflation cooled to 3.4%, compared with 3.5% in November.
The ECB held its key deposit facility rate at
2% for the fourth consecutive time in December, having last cut rates in June.
The trim, which coincided with euro
zone inflation hitting 2%, was part of a rate-cutting cycle
that has brought rates down from 2024′s record high of 4%.
Top ECB board members told CNBC late last year
that the easing
cycle is close to, or at its end, although
the central bank has repeatedly said it will take a meeting-by-meeting and data
dependent approach to rate setting.
The euro and Stoxx 600 were
unchanged on Wednesday following the data release, although the inflation rate
returning to the ECB’s target could signal further rate cuts ahead.
“The move should please equity markets, as it
gives the ECB yet another reason to cut interest rates further in 2026. That
said, inflation has been hovering either side of the 2% level for most of
last year, so today’s move is minor, but a positive, nonetheless,”
Michael Field, chief equity strategist at Morningstar, said in emailed comments
Wednesday.
“Central bankers walk a
tightrope, attempting to stimulate the economy without igniting
inflation. But with inflation low and steady, they should be able to
take their foot off the brake and lean towards
more stimulus sooner rather than later.”
Euro zone
inflation hits 2% in December, in line with forecasts
Bankers eyeing warning signs for credit cycle downturn, says JP Morgan
chief
Wednesday 07 January 2026 7:59 am
Bankers are paying close attention to early warning
signs of a downturn in the credit market, a top JP Morgan executive has
told City AM, as economic uncertainty and a spate of
corporate collapses spark lender caution.
Filippo Gori, co-head of Global Banking at JP
Morgan, cited a rise in rates of fraud as well as the possibility of higher
inflation as among top concerns for banks in the year ahead.
Gori said: “Ultimately, the credit cycle needs to
come to an end at some point. It has been benign for a prolonged period of
time. What will cause the credit cycle to normalise? We don’t know, but spreads
are now very tight considering everything else that is going on.
“We have seen and observed that there is more
fraud, especially in asset-based lending. Some people think that fraud is a
canary in the coal mine, meaning if borrowers become fraudulent it means they
have exhausted all the other options.
“Could it be an early warning that the cycle is
turning? That’s the question we’re asking ourselves. Everything seems to be
going fine but we need to be cautious because things will come to an end.”
Gori warned of the possibility that inflation
“might come back later in a way that is not fully understood”.
“There will be an adjustment at some point [but]
calling it is very difficult,” he added.
Banks were rocked by the collapse of US car parts firm First Brands in
September, with the business revealed to have been in billions of dollars of
debt due to “opaque” off-balance sheet financing structures. It was followed
shortly afterwards by the bankruptcy of subprime US auto lender Tricolor.
More
Bankers
eyeing warnings for credit downturn, says JP Morgan chief
Technology
Update.
With events happening fast in the
development of solar power and graphene, among other things, I’ve added this
section. Updates as they get reported.
Battery storage facility condemned after fire in Orange County,
ordered to shut down (update)
January 6, 2026
An Orange County village has condemned a
battery energy storage facility that caught fire last month, ordering it shut
down and citing what officials say were safety failures and unauthorized
operation.
The action follows a lithium-ion battery fire that broke out at the
Convergent Energy facility at 28
Church St. Extension in Warwick around 10:30 p.m. on Friday, Dec. 19, according
to a detailed update released by the Mayor’s Office.
Warwick officials said the Building
Department has issued a Notice of Violation and a Condemnation Order, and that
the facility does not hold a valid Certificate of Compliance and should not
have been operating at the time of the fire.
Village officials said air monitoring
conducted during the incident detected hydrogen cyanide at 0.5 parts per
million at a monitor placed adjacent to the facility while the fire was
actively burning — about half of the federal maximum allowable level. Downwind
monitoring locations, including Memorial Park, showed zero readings, officials
said. Continuous air monitoring continued through Dec. 22 as battery
temperatures declined.
The blaze was limited to a single
battery cell, though exterior paint on adjacent cells ignited, according to
fire officials. Lithium-ion battery fires cannot be extinguished with
water and are typically allowed to burn out, making air-quality monitoring a
key concern throughout the incident.
The system has since been disconnected
from the power grid, internally disengaged, and tarped, with damaged batteries
expected to be removed.
Village officials said the site has a
history of safety issues. In 2023, a similar battery storage unit at the
Warwick School Bus Garage caught fire, and the Church Street facility
experienced an overheating event. Both incidents were attributed to moisture
infiltration, officials said. Following those events, the Village Board and
Village Engineer requested enhanced safety monitoring, which village leaders
say was dismissed by both the battery manufacturer and Convergent Energy.
Village legal counsel has formally
notified Convergent that the company will be responsible for all costs related
to cleanup, testing, engineering, and police services. The village has also
requested additional surface, soil, and water testing and is in the process of
retaining an independent consulting engineer.
As previously reported by Daily Voice, the fire reignited community concerns about
battery energy storage systems in residential areas. Town of Warwick officials
enacted a moratorium on new battery storage facilities following the 2023
incident, a restriction that remains in place.
Battery storage facility condemned after fire in Orange County, ordered
to shut down (update)
Next, the
world global debt clock. Nations debts to GDP compared.
World Debt Clocks
(usdebtclock.org)
The gold standard did not collapse. Governments abolished it in
order to pave the way for inflation. The whole grim apparatus of oppression and
coercion, policemen, customs guards, penal courts, prisons, in some countries
even executioners, had to be put into action in order to destroy the gold
standard.
Ludwig von Mises
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