Truth or Consequences

Macro Monitor, September 14, 2025

Charlie Kirk

For me, and probably for you, last week was extraordinarily difficult. There were Russian drones over Poland, a bloody revolution in Nepal, and Charlie Kirk’s public and brutal murder.

Kirk’s assassination meant not only the loss of a precious life, but also the loss of precious truth. Many on the Left have denigrated the importance of Kirk to the MAGA movement, which encompasses almost half of the country. Some have twisted the significance of the killing to confirm their own bias and blame President Trump for creating the toxic environment that promotes hatred. Others on social media have relished the violence of his loss.

The Right has been similarly repugnant, in my view, organizing an online campaign to root out, shame, and yes, cancel any internauters who have posted anti-Trump or anti-Kirk content. The Right has usurped what it hates most about the left - “cancel culture.” President Trump himself has blamed “leftists” when political violence is committed by both sides.

Facts have fallen by the wayside. Within minutes of Kirk’s murder, a video clip showing a long-haired young man “celebrating” the killing circulated on Twitter. Three days later, the full video was published; that person wasn’t commemorating death - he was chanting “USA, USA, USA”, the way the crowd chanted after Trump was nearly assassinated last year. He was a Kirk supporter.

Jair Bolsonaro

Here in my adopted land of Brazil, the truth was also slaughtered last week.

Former right-wing President and Trump ally Jair Bolsonaro was convicted on Tuesday of five crimes and sentenced to twenty-seven years in jail. The decision was not a miscarriage of justice; it was an abortion of justice.

Bolsonaro has been the victim of a renegade Judiciary, led by a psychotic, power-hungry Supreme Court Justice who has systematically suppressed freedom of speech. I have written about this topic here and here. Therefore, I will not present the facts again today.

And then there is the complicity of the international press. The New York Times, Le Monde, and the New Yorker have taken Bolsonaro’s “guilty” verdict and unashamedly used it to fit their anti-Trump narratives, publishing editorials and opinion pieces that ironically and pathetically praise the triumph of Brazilian “democracy,” which, in fact, has been the loser.

It seemed to me there was nowhere to hide - social media and the traditional media - spreading fake news from both the left and the right, making truth another victim of the horror.

The Market Narrative

Markets are also composed of narratives, and players, including myself, are often guilty of cherry-picking facts and data to fit into their particular view of the economy or the valuation of a specific asset or asset class. The consequences, though, are not murderous. They are simply unprofitable.

Three weeks ago, I wrote that tariffs were a $400 billion tax levied on the private sector, making the S&P vulnerable to a “5-10%” correction.

The following week, in the post “Why are the Gold Miners Exploding?” I triumphantly announced that I had begun selling my precious gold miners into the rally.

Let’s be honest and see what actually happened:

In other words, my view of the S&P was wrong, I exited the gold miners prematurely, and missed most of the strong Treasury rally.

My sin: Not incorporating into my narrative the latest chapters in the ongoing attack on the Fed by President Trump and his henchmen, who have accused Chairman Powell of political bias and technical incompetence. This part of the narrative has been in front of us, and while I didn’t miss it, I didn’t give it the weight it deserved.

Revising our market narrative, let’s now include a two-part chapter, entitled “Debasement.”

Debasement, Part 1: Fed Governor Lisa Cook.

Trump singled out this Biden Appointee, accused her of mortgage fraud, and fired her, purportedly for “cause.” The evidence he has presented is thin. That has led to a court battle from which the truth will emerge, perhaps even in time for the Fed’s Open Market Committee Meeting that begins on Tuesday. As I write this on Monday morning, it isn’t clear that Cook will participate in the meeting.

Debasement, Part 2: Trump Fed appointee, Stephen Miran:

Fed Governor (and Biden Appointee), Adrian Kugler, mysteriously resigned her post on August 8. Trump’s choice for her replacement is yes-man Stephen Miran, who may be confirmed tomorrow in time for him to participate in the Fed meeting. That would set a speed record for confirmation of a Presidential appointee. Miran will surely advocate a cut of 50 basis points in the overnight Fed Funds rate.

Governor Cook’s probable absence and Mirran’s probable presence will not prevent the majority from voting for a smaller 25 basis point cut, but they will influence the projected trajectory of rates that the Fed will indicate in its Summary of Economic Projections (released only four times a year). The “SEP” will probably indicate an additional 50 basis points of cuts this year. To get our earnings, the overnight rate could drop from 4.375% today to 3.625% by year-end.

So let’s update the narrative:

Economic weakness and political interference are working in tandem to put pressure on short and long-term interest rates. Lower long-term interest rates are supportive of stocks, and gold is going parabolic to protect investors from currency debasement. Note that the Euro didn’t move versus the dollar in these three weeks, indicating that debasement is not limited to the dollar, but is occurring against all fiat currencies.

Can assets from gold to bonds to stocks continue to rally? The momentum is there, and the current narrative is alive. I believe, though, that this narrative is already priced in and that a twist to the story is coming, but, dear reader, I can’t forecast what that might be. Perhaps, for example, the Bank of Japan meeting this week will prove more important than the Fed meeting. Let’s see.

For what it is worth (my view having been recently debased), all asset classes seem expensive, and the truth is that I can’t find any value in the markets to share with you today.

Truth or Consequences

I often include in this newsletter nostalgic referencesto reinforce a point. Although it has been a dark week, let me attempt a little old-fashioned light-heartedness that contrasts the golden age of the boomers with the dark ages today.

“Truth or Consequences” was a TV program that ran from 1956 to 1975. The host, Bob Barker, would randomly choose audience members and ask them an impossible-to-answer question. When they didn’t respond “truthfully,” they would face the “consequences.”

I think it is safe to say that we boomers laughed more back then than we do today. The producers of the program even named a New Mexico town “Truth or Consequences” as a publicity stunt to promote the program.

Social media might facilitate the spread of hatred, but it also connects us to our past. Go back to the fifties and check out this Truth or Consequences clip on YouTube.

Do you have five minutes for a little levity to begin your week? Just click below for the consequences.

Note: The Wall Street Journal published today an opinion piece that spells out exactly how the Brazilian Supreme Court has corrupted democracy. Here it is. Congratulations to the WSJ for a bit of truth.

The Macro Monitor

Again, slight risk-on this week.