Farmer Diaries

 The Numbers for Truth social stock price are pretty bad. Not bad in the sense that the company is now severely undervalued, considering it makes no money, has no prospect of ever making money, it’s shocking that it is still worth $17.55 a share. Yet, it’s only three bucks from the lowest level. It’s ever been since acquired the business that is now true social. Before that, it was just an acquisition company.  so, the reality is that true social it’s not a real company, it’s a vanity project, and the quarterly reinvention,It’s proof, that the company has no real business plan. Last quarter, the business plan was to create some kind of video feed company, now, it’s acquiring bitcoin, apparently or some kind of cryptocurrency. At best, it’s Mildly amusing at  worse. It’s a scam.

In 1984, the total Japanese sovereign debt as a percentage of GDP was below 20%. At the end of 2024, Japan's sovereign debt as a percentage of GDP was 229%. What happened in these 40 years? Quite simply, the Japanese were the first to employ quantitative easing to turbo-charge economic growth. It all started after the crash of 1987. Japan’s growth had been anchored on an unsustainable real estate market. Japan, like many Asian countries, is a country of savers. The truth of the matter is, Japanese have consistently saved between 25% and 45% of their income, that money was put in savings accounts and pension designated savings accounts, to be used when they retire. In addition, the Japanese government never eases the rules for pension funds to invest in other things than domestic sovereign debt, or Japanese equities. The truth is, that over 90% of Japanese savings have been funding Japan’s debt. 95% of Japan's sovereign debt is financed domestically. As of the end of 2024, Ameri...

 this will probably sound incredible, and the whole exercise started almost by mistake. Do United Kingdom, and Japan, both agreed to ratify trade agreements with the United States, both of these nations, did this weeks ago. A rather reasonable question was ask of the Japanese by a French journalist, as to the process for having the trade agreements in place. So far, so reasonable. however, there’s a small problem. And it’s a Japanese who gave away the farm. According to the minister of foreign affairs in Tokyo, there has been no exchange of document between the Japanese and the American government. The enterprising journalist, whose lives in Japan, made inquiries. With the Vietnamese, foreign affairs department, the Indonesian, foreign affairs department, and eventually, with the European union for foreign affairs department in all cases, he found the same answer. Since the initial announcement of trade agreements, absolutely nothing has been done. I think it’s important to underst...

The "war" between Jerome Powell and Donald Trump on interest rates is missing one critical point.   The real world.   America is increasingly facing steep interest rates when it borrows on the international markets.   The last $100 billion 30 Year bond auction was a disaster.  It is unlikely to improve, because of the weak dollars, many investors are "re-thinking. their dollar holdings, and are coming to a similar conclusion; they have either too much or enough.    The American government's total debt burden of 37 trillion dollars has a duration of five years, that means that about 20% of the total amount has to be refinanced every year.  Of this total about 2/3rd is finance in the international markets (or it has for the past few decades).  In addition, under Trump the deficit is rising quickly from 6% of GDP to 9% next year.  Investors are smart, they know that a big refinancing bubble is an opportunity – hence the last 10 auctions hav...

The jump in the PPI from an expected 0.3% rise to an actual 0.9% is about as bad news as the President of the United States could get.   Unfortunately, it's getting a lot worse, the month on month increase in price to consumers of fruits and vegetables is nearly 39% in July... The first figure was long expected, but the scale of the rise surprised, which means that producers are now starting to pass on to their clients the tariff costs.   That was always going to happen and it is now. The price of fruits and vegetables is the natural consequence of two factors, both political; the tariffs on imported fruits and vegetables from Mexico (35%) and Kenya (25%) and Brazil (50%), the hit there is instantaneous (note: Brazil and Kenya are the largest exporters of coffee to the US).   These avocados that used to cost $2.00 are now $2,60.   In addition, the raids by ICE have increased the cost of domestic fruits and vegetables...because many farmers are una...

 To call it a nothing burger would be an insult to nothingburgers!   Trump got nothing no commitments to anything from Putin, who reiterated his initial position, Putin got the red carpet treatment (literally and figuratively).  He started a war of agression and Trump let him off entirely.    This is so embarassing, I cannot wait to see how Newsmax and Fox spin this little "peace conference" even the tame fox journalist was at a loss for words.

At first, the meeting between Putin and Trump was heralded by Trump as being the solution to the Ukraine war.   Over the past three weeks the expectations have been managed.  Now, everyone hopes that Trump doesn't do anything stupid.   Granted the likelihood of that happening is slim to none. At first, Trump screwed up (again) and he said there would be "land swap".  It was President Macron who told Trump publicly that any changes to the territorial integrity of Ukraine woud involve the President.    Trump wants a win, and it's looking increasingly unlike that he will get one.   First, because Trump has nothing to offer, and Putin has no incentive to change the way he deals with Trump, he's been successfully playing the man as a fool for years. At best, expect an outcome identical to Trump's meeting with the leader of North Korea.  Big words no action,  Lets be clear Trump is there to "negotiate" with Putin.  Putin has no ...

Canada has decided to fight fire with fire, and imposed "export restrictions" on strategic material using the exact same rules that Trump used to impose Tariffs on Canadian imports of Steel, Aluminum and Copper.  The impact is large shortfall in the import of these materials in the US aerospace and automotive industry in the US forcing US companies to shut production down. Lets be clear the impact of a trade war between the US and Canada will be felt mostly in Canada were nearly 40% of GDP is export related.   In the US is less than 10%.    In addition, Canada's steel and aluminum production is now exported to Europe duty free, and both metals are considered "Low Carbon" product - since 90% of the prodution process relies on hydro power. Interesting times, 

Most people will not know that Elon is one of the most hated men in America. On the bright side his board still loves him, they just gave him 30 billion in share grants over the next five years, because when you already have 200 billions you need another 30.   On the positive side, Tesla always aimed at abandoning the luxury market.  People don't understand how small it really is. The number of cars sold for more than $100,000 is remarkably small (although it is growing as the cost if US made cars grows by at least 10% per annum...and tariffs will make it worse).  The future of Tesla has to be the 3 and the Y, because they are mass market vehicles.   Tesla's current problem is its founder and CEO, sure, but also its product, which has not evolved much, and now there are many competitors -- granted the vast majority are not American..so the tariffs there may help, maybe!  Don't forget all the aluminum that is in a Tesla. The first X and S disapeare...

Simple, nobody is interested... 

If Donald Trump has a trade policy, and there is a school of thought that trade policy occurs every day between 11 and noon.  It is similar to what Americans did during the cold war, but instead of promissing security pacts, they restrict or open the American goods market. Credible stories emerged that at lunch time on April 2nd the list and size of tariffs had not been created yet.  Which explained why places with zero human population saw tariffs.  On August 1st the "extension" for all countries to negotiate ended" and additional tariffs were announced on the imports of certain goods from Canada and Switzerland 35% and 40% respectively. The "trade ageements" that were struck with Europe and Japan are confusing,  it seems that things were agreed to which were outside the scope of what either party could deliver:  Energy to Europe, and investment onto the US.   Americaès energy export infrastucture is operating at capacity, the new energy purchase from...