Political Migration, Rising Censorship and Powell's Next Move
August 2024 Edition: Issue 08 - Macro Chronicles: Unfiltered Insights
Hey there,
As the summer sun sets, the global chessboard is still buzzing with moves that could make anyone’s head spin—and trust us, it’s only going to get more interesting this fall.
We’re now just 62 days away from the US Election (mark your calendars for November 5th, 2024), and the markets are still throwing surprises left and right. Some asset classes have been riding high all year, and from the looks of it, they’re not planning to come down anytime soon.
If this is your first time tuning into our Macro Chronicles Newsletter, buckle up! You’re about to get a front-row seat to the world’s most thrilling political, cultural, and economic rollercoaster.
Plus, we’ll let you in on how our portfolios evolve—because who doesn’t like to stay ahead of the game?
Lets jump right in - because there’s a lot to cover.
Macro Headliners
written by Nic A. Tartaglia
POLITICAL
Venezuela
This political development is only growing further, destroying the country and regressing it. Let us look at some of what has been going on here since I started talking about the issue back in July’s macro report:
Maduro challenges Elon to a cage fight, calling Elon an “arch enemy”..... Maduro is losing it clearly. He even claimed that Argentina President Javier Milei and Elon Musk are members of a Satanic Cult.
Maduro bans and blocks access to X for 10 days. I could not verify if the ban was still in effect or not.
Maduro urges citizens to report on their fellow neighbors who doubt and question his Re-election.
Massive gatherings occur for Venezuelan opposition leader Maria Corina Machado but obviously met with a lot of Maduro resistance forces.
Maduro sents his forces to arrest political opponents and those who dare to claim Maduro lost.
U.S. Secretary of State Antony Blinken on the issue said "overwhelming evidence" of the victory of Gonzalez and that Washington recognized him as the winner of the election.
Bangladesh
Prime Minister resigns amidst mass violent protests and deaths that started back in July. Before her official resignation, her residence was broken into by rioters as she fled to India as she resigned. Even the Parliament was taken over by protestors. Read the previous July Macro Chronicles report to see how this development started.
The military has taken control and the remaining government has set a new interim government headed by Nobel Peace Prize-winning economist Muhammad Yunus. He has lifted a ban on the Jamaat-e-Islami party that was imposed under an antiterrorism law. Hasina’s government banned the party on August 1, just four days before she was removed from power after weeks of student-led protests, fleeing to India by helicopter. Hundredths of people were killed, according to United Nations estimates, as a consequence of clashes between protestors and military/police forces.
Russia & Ukraine
Strong offensive beginning to the month for Ukraine as they invade Russia’s Kursk region in a surprise offensive move. Moscow reports that its forces halted a significant Ukrainian incursion in the Kursk region, consisting of up to 1,000 soldiers and dozens of armored vehicles, one of the largest since the full scale invasion by Russia. Ukraine has managed to fortify the area and keep a hold of it. But Russia has now surrounded the area with reinforcements and is most likely to see many Ukrainian casualties as a result. Putin in a statement at a press conference restates what he has been saying for many many years. The West is fighting them through Ukraine’s hands.
On the other hand Russia advances on Donetsk showing they are making significant progress in eastern Ukraine. Ukraine orders the evacuation of Pokrovsk, a key city integral defensive stronghold and logistical hub for the Donetsk region. A population of roughly 53,000 was ordered to evacuate by Kyiv. It still appears that Russia is ahead in the war, despite Ukraine’s resilience which is entirely due to the West’s significant support.
Sergey Lavrov, The Minister of Foreign Affairs of the Russian Federation stated: “without instructions from the United States, Ukraine would never dare to violate the Russian border.” He also stated that “Western countries are like children playing with matches.”
"Without instructions from the United States, Ukraine would never dare to violate the Russian border
President Aleksandr Lukashenko stated that “The era of Western Hegemony is becoming a thing of the past. The global development center, economic center and political decision-making center are shifting to the “South and East”. This requires us to actively play a role in international affairs. The “Global South” must do its utmost to speak out and unleash its huge potential.”
Later on into the month of August, Zelensky launched one of the most significant drone assaults on Moscow.
Comment from Former President of the United Nations Security Council
Kishore Mahbubani stated in an interview that “Asia should take action to stop US and Western forces”. Asserting that Asia needs to wake up before they have to deal with the “angry dragon” created by the West.
Kishore Mahbubani: "Asia should take action to stop US and Western forces" #asia #western #usa
Nord Stream Gas Pipeline Mystery
Germany issues arrest warrants for Ukrainian divers who are suspected of being the culprits of the 2022 Nord Stream Pipeline destruction.
It was apparently blown by a small Ukrainian sabotage team, set forth by Zelensky in 2022. Ukrainian officials reject the accusations and point the finger to Russia instead as the culprit of destroying their own gas lines.
What are the actual facts? Unsure for now, so keep an eye on how this continues to develop.
On a side note related to gas supply, as of the time period I write this, the US is the largest exporter of LNG to Europe, which occurred after the Russian-Ukraine war. Prior, the Nord Stream Gas Pipeline fueled 45% of the gas consumed by Europe, of which much was supplied through this pipe.
War will be a driver of economic “growth” or “activity” in America to run and hide from the regressive socio and economic conditions creating down pressure on the US economy.
Russia & US Prisoner Trade
Wall Street Journal reporter Evan Gershkovich and former US Marine Paul Whelan were among those released in a 6 nation prisoner exchange. Russia secured the release of the so called “hitman” Vadim Krasikov, some hackers and other civilians and children.
USA
Military Development
US Defense Secretary Lloyd Austin has deployed additional US Troops with combat aircrafts and warships to the Middle East to bolster Israel’s defenses as a result of the growing tension with the militant groups in the middle east.
Especially with Iran after the assassination of Ismael Haniyeh, a Hamas leader and key Hezbollah Commander Fuad Shukr. Read last month's macro report for a deeper insight into that development.
Simultaneously the US approves $20 billion in weapons sales to Israel as wider war looms.
The U.S. officially withdrew from their last base in Niger, well ahead of their September 15 deadline.
Several US personnel members were injured from a rocket attack on U.S. forces at an airbase at Al Asad, Iraq
The Biden Administration has decided to lift a ban on US sales of offensive weapons to Saudi Arabia
The US Navy will sideline 17 vessels due to a “manpower shortage” that makes it difficult to properly operate ships across the fleet. This has been an issue I have discussed in my report about the lack of recruitment in the US military, from a lack of confidence in the military’s respect for its soldiers and the fact that it has become very politicized.
The US and India have signed a Securities of Supplies Arrangement Agreement (SOSA). A key defense deal that allows both countries to quickly provide each other with vital defense supplies in times of crisis. Clearly they are thinking of China making aggressive moves. This has been signed with only 18 countries, among them are Australia, Canada, Japan, and several other NATO members such as Italy, Denmark and the Blastic Nations.
US admiral says American ships could sail into a South China Sea standoff to shield allies amid tensions with China.
New Developments on Trump Assassination Investigation
Video evidence surfaces of local police officers saying they told the Secret Service to post people at the spot where the shooter had climbed up, there is no digital trace of Thomas Crook anywhere online as though his digital fingerprint was erased and his body was released for cremation without approval from the head coroner who was overlooking the body. Multiple Secret Service agents have also been placed on leave.
All these were mentioned in the House Republicans forum they hosted on the attempted assassination of former President Donald Trump. Watch video below.
https://www.youtube.com/live/t825B7CE3WU?si=N9h7OXA6PrJfI979
On the side of news coverage, what has been fascinating to observe is that the media attention on this issue died as fast as it came out and did not last many days. The Biden administration and media partners clearly do not want the negative attention on this. If you would follow the hearings and testimonies on this issue, you would understand why. So do watch the videos I have integrated into the report on this issue, including in last month’s report. It reveals a lot.
Another Trump Assassination Plot ...
Asif Merchant, a Pakistani National was arrested for attempting to hire a hitman for planned assassination against President Trump.
Trump Begins To Fight
Trump to sue the DOJ for $100 million over their raid at his Mar-a-Lago home claiming political prosecution.
Goes on a handful of podcasts really putting himself out there to connect with more voters across the entire country.
The Left Goes Right
California Democrat State Senator Marie Alvarado-Gil has announced that she is switching to the Republican Party, criticizing the leadership and policies of the Democrat party.
Texas State Rep. Shawn Thierry announced she is switching to the Republican party and blasts democrats as radicals who want to mutilate children’s genitals, stifle free speech and put men in women’s sports.
Tusli Gabbard, a former democrat who left the party back in 2022 is now endorsing Trump
RFK jr. makes a historical move and drops out of the race, endorsing Trump. RFK Jr. stated about the democratic party:
“It Became the party of war, censorship, corruption, big pharma, big tech and big money.”
During a Trump Rally in Arizona on August 17 - RFK Jr. mentioned the importance of “protecting our children and the food they eat” - indirectly hinting that there needs to be a full restructuring of the FDA.
JFK Jr’s speech dropping out and making the endorsement.
Is Trump Pushing Socialist Policies?
Trump has promised in one of his speeches that he would require the Government and or mandate insurance companies to pay for IVF treatments. This is literally a welfarism program using other people’s money to win popularity and fuel special interests, and in this case those who want to have children and are having a hard time. Ignore the sentimental and emotional aspect of this, and focus on the behavior. This is what socialists do.
Kamala Harris Presidential Run
A list of things she said would do once in office
Copying some of Trump’s promises if Elected - no tax on tips
Raise minimum wages
Proposes $25,000 down-payment assistance for first time homebuyers.
Stop price gouging (aka price controls)...... how will she do it? Well all we know is that it requires more laws, regulations, government and subsidies to even attempt at accomplishing this. And always with great consequences. This is a bunch of big government promises like countless other tyrants and cowards in human history. She acts like she is a God. As do all politicians with their endless claims.
She also backed Joe Biden’s 44.6% capital gains tax proposal as well as a 25% tax on unrealized gains for high-networth individuals.
The media has totally created a hysteria yet again and this time around the Kamala Presidential race. What a joke the seat of the so called most powerful nation in the world and in human history has become. To have given the opportunity to such a frail intellectual coward who knows nothing of honor and responsibility is a joke. Someone who was never voted to that position and merely placed there with no effort, is now perceived like some hero by a fraction of the democrat party, which is clearly subdividing into smaller fractions as their ideologies continue to clash internally. But these are the same people who lied about Biden’s cognitive capabilities, who have stolen all the attention in order to push Biden into a corner and keep him hidden after his complete failure at the debate with Trump. The new Kamala wagon has gone full blown sheep showing just how truly swayed they are by media and political narratives. She had one of the worst VP popularities in American history, and is now front runner for President against Trump without doing any interviews solo or having debated any of the competition yet. How shameful. Yet people are jumping on board and riding this fairy tail wave.
She is making promises of claiming to be able to fix America's problems that are currently facing them as though she isn't currently holding the 2nd most powerful seat of the American Government, as part of the Biden Kamala administration…….. You will promise to fix what you currently could “fix” in your current position with your Democrat President? Makes no damn sense and yet, Kamala is a legitimate contender people have fallen for.
Kamala so far refuses to debate Trump on Fox. There is a supposed debate occurring Sept. 10 on ABC, between them, that she is now trying to change the conditions to the debate.
Crazy Laws & Overreach
Ohio’s 6th U.S Circuit of Appeals just recently ruled that Olentangy Schools District can punish students for intentionally “misgendering” others. The court claimed “that the district did not compel speech in a way that violates students’ 1st amendment rights.”
In a 5-4 decision, SCOTUS struck down the Biden-Harris administration’s rewrite of Title IX which would have allowed men in women’s sports, bathrooms, locker rooms, dorms and compelled speech.
The Supreme Court released a one page order blocking the Kamala-Biden administration from using taxpayer dollars to buy young voters by attempting to cancel their student loan debt.
California lawmakers approve $150k down payment assistance for illegal immigrants. Bill AB 1840 allows for undocumented immigrants to receive this welfare program through the “California Dream For All” loan program.
Oklahoma creates a task force to give illegals visa’s and ‘driving privilege cards’ and releases final report. Gov. Kevin Stitt’s work permit and visa task force has five recommendations for how Oklahoma can encourage non-citizens to join its workforce. They include establishing a new government office and providing certain folks with special privilege cards to drive — which require legislative will to implement. Tricia Everest, who is Stitt’s Secretary of Public Safety and the chair of the task force, said it would be a critical first step in addressing the needs of the state, its employers and its growing immigrant community. “I am launching the Oklahoma State Work Permits and Visas Task Force to find ways to bolster our workforce and create opportunities for those who are here contributing to our communities and economy,” Stitt told reporters during a press conference in April. Same Governor that proposed and passed House Bill 4156 criminalizing anyone in the state without legal immigration status, which Stitt signed the same day he established the task force.
Massachusetts towns set a voluntary curfew over critical levels of EEE which is a disease known as Eastern Equine Encephalitis found in mosquitoes. Let’s see how this develops and if it remains “voluntary”.
Mexico
The President of Mexico stated in a conference “The United States lacks respect for us and interferes with our sovereignty.” He paused relations with the US Embassy amid clash over judicial overhaul he is planning, as they have been criticizing him for his push in the final weeks of his 6 year term to make changes in the Judiciary, potentially forcing thousands of judges out.
AMLO Freezes Ties With US Ambassador Who Criticized Reforms – BNN Bloomberg
Middle East
Israel
Very offensive month for Israel. Let’s get right into some of this month's developments with the Middle East war:
Israel vows to eliminate new Hamas chief Sinwar
Israel strikes and kills senior Hamas figure in South Lebanon
There was a failed assassination attempt by a suicide bomber in Tel Aviv
Israel carries out airstrikes on Hezbollah’s ammunition depot creating a massive fire
A convoy of trucks carrying weapons and arms from Syria to Lebanon for Iranian backed militant forces was struck by Israeli airstrikes in the Beqaa Valley of Eastern Lebanon.
Sidon, Lebanon sees Israel IDF eliminate a supposed Hezbollah terrorist known as Omar Khlalilhal.
In Kiryat Shemona, Israel there was a direct hit by Hezbollah rockets at a house.
IDF targeted a senior level Hezbollah operative with a targeted strike.
The Israel Defense Forces (IDF) said about 100 fighter jets had “struck and destroyed thousands of Hezbollah rocket launcher barrels” in more than 40 areas of southern Lebanon in a pre-emptive strike. The strikes went ahead after "extensive preparation" for a large-scale aerial attack by Hezbollah was detected, IDF spokesman Rear Admiral Daniel Hagari said. Hezbollah said it had still managed to fire 320 rockets and drones at Israel in retaliation for the assassination of a senior commander.
IDF assassinates 4 militants, 3 from the Islamic Jihad Movement and 1 from Hezbollah in Lebanon strike.
RED SEA
Greek Sounion tanker gets striked by Houthi missiles creating a massive explosion. Clearly the West has yet to secure the Red Sea for flow of goods.
Iran
The Vice President Jarad Zarif who was the former Iranian Foreign Minister resigned. Meanwhile the current Iranian Foreign minister stated that they have the right to punish Israel.
Deployed Russia’s most powerful jamming communication systems, Murmansk-BN in strategic locations. They are preparing.
There was a major fire that broke out in fuel drops in Khorasan Razavi, in northern Iran. What is the cause is unknown to me.
Al Qaeda
An Al Qaeda linked group said it has killed nearly 300 people in a devastating attack in north-central Burkina Faso, West Africa targeting militants linked to the army, and not citizens.
Turkey
In Ankara, Turkey, a brawl breaks out in the Turkish Parliament.
Pakistan
Coordinated attacks by unidentified across the southwest province of Balochistan which saw militants kill 23 people..
Australia
National Terrorist Threat Level was upgraded from possible to probable. The Government warns that is not the result of some specific intel of imminent threat or danger. This comes in the face of advice that more and more Australians have been adopting/embracing a diverse range of extreme ideologies. Same threat level they had in place from 2014- 2022 before lowering it. They mentioned the rise in politically motivated violence and extremism. Many democracies are working to address this including the USA and UK. They claim to worry about youth radicalization
As such on the front of “security” they want to implement social security measures with the government at the center to keep an eye and “ensure” their “safety”. A digital ID system, called TEx. The last phases of the project are in development and launch of the system is expected for 2025. The government claims it will be optional……. (for now).... Google and Telstra are helping develop the technology.
Govt announces new digital ID system: TEx | Information Age | ACS
WHO - World Health Organization
They declared a fast spreading MPOX outbreak in Africa a global health emergency as the agency seeks to contain the spread of the potentially deadly virus.
Then the CDC begins their warnings to American Travelers of risks from fever-causing virus…
At the University of Maryland School of Medicine, they performed the first clinical trials of the Monkey Pox Injection.
On the Political front of Bitcoin
Democrat Senate leader Chuck Schumer stated that he plans to support crypto innovation within a set of rules to be passed through a bipartisan bill in the Senate this year. He made this statement while attending an event for VP Harris supporters within the digital asset industry.
The Battle To Control Social Media Companies
As conflict internally and internally grows, trying to control the narrative and speech of others becomes more and more of the typical behavior seen by central authorities (aka governments and tyrants).
EU letter to Musk in response to his Interview with Donal Trump
Brazil Judge orders the immediate suspension of X in Brazil.
Same behavior is being seen in Australia in trying to censor/limit the reach of X. Was even a matter of discussion in America, seen at a White House press conference.
Telegram CEO Arrested: the CEO of Telegram, Pavel Durov was arrested and released on bail for refusing to follow censorship laws. The Biden administration has been encouraging France and Macron to make this move. Telegram is a publisher platform where free ideas and thoughts can be published. But clearly the government across the West wants platforms that do not work with them controlled and punished. He has even mentioned in an interview on the Tucker Carlson Show that “I personally experienced similar pressure in the US. Whenever I would go to the US, I would have 2 FBI agents greet me at the airport, asking questions.”
Mark Zuckerberg appears to have done a 180 in admitting the role the government played in seeking to direct and censor language and information they did not like, especially with the last election and during the Covid hysteria. Read the following letter sent to Jim Jordan who had previously held a Senate hearing on this issue with Mark giving his testimony.
CULTURAL
Afghanistan
Many Afghani including Taliban fighters went out to the streets of Kabul to celebrate the 3rd anniversary of the Taliban’s return to power. They even demonstrated in their celebration all the armored vehicles lost by the Americans when they quickly withdrew.
Bangladesh’s Religious Conflict
As the political conflict developed, there has been a parallel issue that has become another source of protest and uprising. The issue surround the persecution and lynching of Hindus at the hands of Muslims. Dhaka saw a huge uprising in protests against these attacks. Religious conflict in these regions have always been going on.
The DNC (Democratic National Convention) Event
In Chicago where the event took place, businesses in the surrounding areas took precaution in preparation for the event by boarding up their stores. This was not a behavior witnessed in Milwaukee where the RNC (Republican National Convention) took place.
We saw a lot of protests at the DNC, showing even the divide within the Democratic party.
Nigeria
Kano Nigeria protests. This is a continued nationwide movement being seen in relation to government and economic conditions.
Pakistan
Protests erupt by muslims after supreme court grants religious rights to non-muslims. One of their demands is the call for the resignation of the Chief Justice in Pakistan.
There is also a nationwide strike occurring by traders against the new imposed taxes and inflationary environment.
Illegals Want To Vote
Protest on Capitol Hill demanding that illegal immigrants receive the right to vote.
Chaos of Illegals In USA
In Aurora, Colorado, a Venezuela gang has taken over multiple apartment complexes forcing people out with guns creating a stronghold and extorting residents for rent money after pushing out the property managers. This has been confirmed even by the Mayor of Aurora..
A man in Philadelphia attempted to gundown and kill innocent Americans driving by and then fired shots on Police officers who tried to confront the criminal. This man is an illegal immigrant part of MS-13 from El Savador.
There are too many stories like these happening across America, especially where Democrats have heavy control. We cannot forget what empathy and mercy applied horribly brings about as consequences. You have opened the door to criminals and primal threats
England
This is a significant cultural problem still brewing that can easily ripple into other parts of Europe, and into North America, especially when we see how the government responds as a consequence of fueling this cultural problem.
Across the UK we are seeing continued protests, mobs and gang attacks escalating from this deep divide being observed in that region. We are seeing the rise of violent counter protest groups (muslims, the left, illegals) to fight back against the anti-immigration/anti-muslim/anti-open border protests that has seen growing.
Sunderland in England saw its police station set on fire amid protests over the Southport stabbing. Resulted in 8 arrests with 3 officers injured.
Liverpool sees their city fall under conflict with massive violent clashes between police and citizens.
Violent protests in Rotherham, in Belfast, in central London, in Leeds
In Sheffield and in Croydon. Seeing the ripple effect brewing chaos within the their society?
Violent mobs attack locals in Middlesbrough England.
A Lot of knives and machetes are being seen in the streets as a consequence of these developing events and tension. Especially as gang activity thrives when chaos erupts.
The people of England have turned against themselves as a result of the government, giving power to the state to keep growing in power as the people are distracted fighting among themselves.
Flood the country with immigrants through Welfarism. Under Welferism, where we pay and support those who come here, free immigration will never work in a sustainable way.
Instigate conflict between citizens and immigrants/open border supporters.
Go after citizens who voice concern online.
Implement police state “Big Brother” to watch your every move and every word and punish you if you go against their wishes.
What has happened recently in the UK in consequence to these very chaotic developments? The UK Prime Minister promised that strict actions will be taken against ‘criminals’ rioting in the streets. They will use facial recognition to track down their citizens.
Government Arrests
Intense crackdown in Sunderlands as police conduct door to door raids forcing entry to arrest protestors.
Even people posting any support of protests and or are being accused of their posts “inciting violence” are being arrested.
Over 1000 people have been arrested following the mass riots/protests across the UK
It is called “The Offensement Incitement to Racial Hatred law”
The Director of Public Prosecutions of England and Wales, Stephen Parkinson stated:
“Publishing or distributing material which is insulting or abusive, which is intended to or likely to start racial hatred. So if you retweet that, then you will be publishing that and then potentially committing that offense. ANd we do have dedicated police officers who are scouring social media. Their job is to look for this material. And then follow up with identification, arrests and so on.”
Australia
Australia in consequence advises citizens not to travel to the UK, with Malaysia and Nigeria advising the same warning. Nigeria, Australia and several other countries warn about travel to UK amid riots | CNN
Australians will be required to submit ID to access the internet and police must have access to their social media. Australia to implement landmark national digital id system - Lexology
Nigeria
Nigerian protestors raise the Russian flag and it bothers Tinubu. The Nigerian Government says it will not tolerate protestors waving the Russian flag.
Cyber Attacks
Massive hack reported where social security numbers of every American from the National Public Data - 2.9 billion people’s data stolen
ECONOMIC
Central Banks
BOE - Bank of England
Cut rates
FED - Federal Reserve
Waiting to see the September decision.
Fed Powell Speech reveals that the “Time has come”, indicating rate cuts are about to occur in the near time. September appears to be a suspected timeline for this to occur. All the pieces are falling in place for it to happen.
Some FED Rate Cut Expectations:
JP Morgan forecasts half a point FED rate cuts in both Sept and Nov.
Mohammed El-Erian believes the FED has waited too long to cut rates and is now playing catch up as they have underestimated the slow down of the economy, while including the unwinding of leveraged positions out of Japan. “An economic slowdown, and a FED that is behind.”
“A rate cut in September is now a virtual lock, but we do not think the economy needs aggressive, recession-sized cuts.” - Michael Gapen, Bank of America U.S. economist
“Across the board, there is just not much evidence of the economy either being in a recession or being on its road to entering a recession.” - Torsten Slok, Apollo Global Management Chief Economist
“The composition of the rise in unemployment is sort of different from what you normally see at the beginning of a recession.” - Brett Ryan, Deutsche Bank Senior U.S. Economist
“We think risk assets can recover as recession fears ease and the rapid unwinding of carry trades stabilizes.” - Jean Boivin, Blackrock, Investment Institute Global Head of Research.
“We are expecting the U.S. Economy to slow, but we’re not expecting a recession.” - Seema Shah, Principal Asset Management Chief Global Strategist
Credit: Tavi Costa from Crescat
BOC - Bank of Canada
Waiting for September to see what they decide.
I don’t see why they wouldn’t continue to cut by at least 25 basis points.
US Economy
Let’s first look at some credit and consumption graphs which speak volume alone.
Remember when the government says “the economy is strong and resilient”, ask yourself this question; to what degree is this all being driven by debt. The household debt and national debt just keeps growing, which is fueling these metrics of “strength”. Meanwhile by most socioeconomic metrics…. wealth disparity, depression, anxiety, obesity, drug abuse, suicide, anger, division, conflict, education and so on keep getting worse. We are merely running from the truth.
Eventually we will learn the consequences. It is always a matter of when, not if. History proves this. No other evidence is needed.
Downward revision of Jobs Data
The Bureau of Labor Statistics has revised their jobs data for April 2023 - March 2024 downward by nearly 1 million. Meaning all the “beats” recorded in the last year have to be adjusted as misses but the media won’t talk about it and the Government won’t admit the reality, while using the lies and misleading data to project strength and confidence.
California Gas Reserves
So basically, the government will spend more money while operating under a deficit to buy up reserves to flood the market to lower prices to create the illusion of cheaper goods. But they owe more in taxes on the back end of that illusion. Great economic magic tricks performance.
Businesses Migrating
Chevron plans to move its headquarters from California to Texas. The second biggest US oil company also announced plans to leave the state where it had been located for nearly 150 years as a result of excess bureaucracy with penalties, and climate policies.
“We believe California has a number of policies that raise costs, that hurt consumers, that discourage investment and ultimately we think that’s not good for the economy in California and for consumers,” Chevron CEO Mike Wirth told The Wall Street Journal.
Berkshire Makes Moves
Berkshire Hathaway sells off nearly $1 billion worth of Bank of America stock
Warren Buffet’s Berkshire Hathaway halves apple stake, boosting cash position to $300 billion.
Early August Market Chaos
$2.9 Trillion wiped out from stocks in a day due to recession fears, worst day since Covid 2020 covid crash.
Korean Stock Exchange suspends trade after KOSPI 200 futures fall more than 5%
The NASDAQ, S&P and DOW were down roughly 3% - thanks to the carry trade from the USDJPY - after BOJ hiked rates by 25bps.
Bitcoin moved to the downside like the risk on assets with its worst week since 2022
Canada
Private sector lost 42,000 jobs while government jobs (public sector) increased 41,000 for the month of July. Private sector loses 42K jobs in July, public sector gains 41K: StatCan (victorianow.com)
Real Estate insolvencies in Canada set to surpass levels of global financial crises.
Google to charge DST fee on Canadian ads starting Oct.1 2024
Canadian National Railway Co. and Canadian Pacific Kansas City Ltd. issued lockout notices to a union representing more than 9,000 employees at both companies, essentially starting a countdown for a nationwide work stoppage unless parties reach a last-minute deal.
“The economic harm will extend well beyond the C$1 billion ($732 million) of goods that are transported by rail each day. It will lead to billions more in lost revenue from goods that won’t be sold, lost wages of workers who won’t be able to do their jobs and the potential for lost contracts from international shippers and consumers.” - Goldy Hyder, chief executive officer of the Business Council of Canada, said in an email.
Canada implements a 100% tariff on Chinese EVs. As well as a 25% tariff on steel and aluminum in order to “protect” domestic manufacturers (this is called protectionism seen in centralized economies moving away from free markets). To ensure any outcome such as this requires more government and intervention distorting the market place.
Infrastructure & Electrification
South Africa’s State-owned rail company need $669 million and five years to upgrade the equipment to revive performance of its main export coal line
Nigeria and Equatorial Guinea sign a gas pipeline project.
China coal production hits a new all time high for July.
Ford cancels upcoming large 3-row electric SUV in favor of leveraging hybrid technology and delays new EV plant construction. Ford Vice-Chairman and CFO stated in a call that this is about being adaptive and listening to customer demands and responses. Hybrid appears to be what customers seek the most.
Canada announces a $300 million to support clean hydrogen trade with Germany.
“Canada is a reliable supplier of clean energy for our global allies. To keep building on our strong friendship and partnership, today’s announcement will ensure Germany has access to Canadian clean hydrogen to power their economy, in turn creating jobs and driving economic growth here in Atlantic Canada.” - stated Minister Jonathan Wilkinson
"Germany is one of the strongest economies in the world. In order to diversify its increasing demand of green hydrogen and speed-up the energy transition to reach global climate goals, Germany needs stable and reliable partners like our close friend and ally Canada. We welcome Canada’s commitment to match our offer of 200 million € (approx. 300 million CAD) in order to co-fund a bilateral instrument for hydrogen trade." - Karina Häuslmeier, Deputy Head of Mission, German Embassy Ottawa
Gold
Sees highest daily closer in history $2550. A gold bar of 400oz is now worth $1 million USD for the first time in human history.
Zimbabwe’s cabinet has approved a roadmap to replace the US dollar with its GOLD backed currency for transactions.
Ghana is the top producer of gold in Africa, and they have just opened their first commercial gold refinery “The Royal Ghana Gold Refinery” in which the government owns a 20% stake.
Gold has stood the test of time. It has transcended monetary systems, cultures, wars, depressions, great crises and so on. Trust it to serve the role it has always served. A safe haven.
Mining
Gold Fields acquired Osisko Mining for $2.6 billion. GOLD FIELDS TO ACQUIRE OSISKO MINING FOR C$2.16 BILLION – Osisko
The proposal to ban open-pit mining advances in Mexican congress. The biggest silver producer in the world is Mexico. This has significant real world consequences on the supply of silver.
BRICS
Indian and Russian central banks have renewed discussions to set a mechanism to expand local currency trade. Russia has emerged as the second biggest exporter to India, after China, with exports growing to $23.78 billion in the first four months of the current fiscal year starting in April, up 20.3 per cent from a year ago.
What can possibly be this “mechanism” they speak off? Hmmm
Brics New Development Bank authorizes Algeria to join the Bank stated the Bank President, Dilma Rousseff. A multilateral development bank, the NDB was established by the BRICS group of developing countries - Brazil, Russia, India, China and South Africa - in 2015. Bangladesh, Egypt, the United Arab Emirates and Uruguay were admitted as new members of the bank in 2021 as part of an expansion drive.
Dollars and Sense - What We’re Buying
Written by Dan Kozel
Gold Trade - Its On like Donkey Kong
The shiny rock continues to make new all-time highs - and with everything occurring globally, and stated earlier in this newsletter - the Gold rotation has yet to begin, and we’re seeing higher prices, as a result of increased fear in the world, and the hoarding from BRICs nations central banks to back their currencies.
Holding on to GLD and physical gold has been a winning trade all year. Gold is up 23% YTD - this is likely going to continue. In fact, so much so, we continue to add small amounts bi-weekly to continue to hedge our risk.
The recent M&A activity has just triggered a momentum wave of increased acquisitions in the space. Just ask Osisko, as they were recently acquired by Gold Fields for $2.6B in cash.
The majors are hunting for strong juniors right now - and for obvious reason. Our core exploration positions are still below and we are adding to them - passively. We believe the time will come when some of these names could produce multi-bagger returns.
But wait - Dan, you’re insane - these haven’t moved in over 8 months. And you’d be correct - and thats simply because of two reasons. The first, nobody really knows these companies exist and the second is, mining exploration, has historically been a net loss operating business. Just ask our friend Rick Rule if you’d like to run a business at a $2B annual loss per year for over 10 years.
Over the next few weeks, we’ll be having multiple discussions with many mining companies to dive deeper into an update on their projects.
We continue to hold on to our core junior positions, which are listed below.
Lavras Gold - congrats to all of those who bought at our November Investor Event last year. This name has been on absolute tear and so much so, Eric Sprott has began trimming his position. The team continues to execute on their drilling campaigns in Brazil and is run by an incredible management team, led my by Mike Durose. If you would open to connecting with management on this name - please send us a note at dan@newgenmindset.com, and we will connect you with Mike.
Silver Tiger - the company continues to publish great drilling results, but is currently dealing with a bit of political uncertainty in Mexico as the incoming President, Claudia Sheinbaum seems to be taking a hard stance against open pit mining. Mexico, globally is one of the largest silver producers in the world. Additionally, Eight Capital came out with a report with a price target of $0.90/share
Delta Resources - the company has continued to expand their entire land package right now, which continues to be a strong indication management feels the entire area at the Delta-1 project could be a much bigger gold mine than anticipated - again, this is a gamble we are taking here after having multiple discussions with the management team. Read their press release from August 26 here, where they discuss the acceleration of adding two new properties.
Emperor Metals - recall, Rob McEwen participated in the private placement back in the spring, and the fact the stock has come down so much only tells me that this name will likely not remain this cheap for much longer. The company will be commencing their drilling program in the fall, with assay results in Q4, possibly beginning of Q1 2025.
In addition to our picks from above - it’s important to talk about the complete underinvestment of and development in mines over the last decade.
But who can blame the industry ?
When operating at billions of dollars in loses to keep the lights on, its no wonder many of the small companies fail while the cash-flowing producers are reeling in the hard cash and prepping to acquire these names for pennies.
The difference now - as we’ve mentioned numerous times, is the upside of gold coming up, cannot be ignored. Technically speaking, this should change over the next several quarters. Pay attention to this trend going forward. It will be an important one, and another reason for gold prices to see higher highs.
This final chart explaining why we believe gold prices will rise is fairly self-explanatory.
With the Fed likely to announce a rate cut in September, historical price action suggests that gold usually trends higher during such periods. Economists predict we will see at least seven rate cuts over the next few quarters, continuing into mid-2025.
Every time a rate cut cycle has occurred, gold has reached new highs.
Long Gold - physical coins, GLD for those who want to keep it simple.
For a bigger producer - Newmont has certainly been paying off.
Dig deeper into the names above - we believe there’s some strong push which has not even started yet - if we’re wrong, we’ll admit. So this type of investing is quite literally a bit of gamble.
Silver should follow suit - at a later time - stay tuned for an update on this one next month. We remain very bullish on silver - with a time lag to gold.
Bitcoin collapses and rebounds - We Added
At the beginning of the month, when the entire market plunged into panic mode due to the unwinding of the Japan carry trade, the only investors who held onto their Bitcoin were the so-called "smart money (and of course, the true HODLer’s). In fact, heavyweights like BlackRock and others continued to buy. Michael Saylor’s MicroStrategy also kept purchasing—this is what institutional capital does, when dumb money panics.
Retail investors panic-sell in a frenzy, playing right into the hands of the big boys. The drop to around $49,900 USD in BTC was a unique buying opportunity for those who could ignore the noise and avoid losing their composure. Fortunately, we had cash ready to deploy in our crypto wallets, and we put it to work - nothing too significant, but enough to prepare for another accumulation period here shortly.
I've mentioned this multiple times in previous notes: the current price of Bitcoin is irrelevant, but when an opportunity like this arises, it's time to take action.
In addition to adding BTC, we also added SOL and XRP along with some of the Altcoins like PEPE, DOGE and SHIBA INU (more for the fun-side of things!). It's likely that the upcoming rate cut on September 17th will trigger a temporary market rally, before we see another reset.
Currently, BTC’s correlation with the market remains positive—almost 3x Beta. This implies that if the market moves 1%, BTC will move 3%, confirming that Bitcoin is still a risk-on asset. We will continue to monitor BTC's price action, especially next month, to see if it has an opportunity to decouple from this correlation.
The chart that stood out to us the most is the one below, which is straightforward to understand. The recent halving in April has made it more challenging to mine BTC—the cost to mine a single Bitcoin has risen to just over ~$72,200 USD.
If this is any indication of anything, the price of BTC needs to go higher. This is especially true for Bitcoin miners, who are proving their importance daily by creating and storing energy.
The upcoming U.S. election will also have an impact on this industry. Trump’s platform has fully embraced crypto, while Kamala Harris and her establishment allies are determined to limit its use - there’s an energy narrative hear, which the media will likely ignore - but if you’re really bullish on BTC and crypto, Trump is your guy (whether you agree with him or not).
Ultimately, the market will decide where the price of BTC should be, and at this point, any dip below the current level is literally, quite a discount - just see the chart above.
HODL for the long term—I have a feeling that those who have been accumulating (and continue to do so) on a monthly basis will wake up in about five years grateful that they did.
This has barely begun—and when Bitcoin rises, so will the altcoins. Please read our April newsletter to see the other two names we bought (and traded). They’re fun to play around with, and the swings are strong enough—just manage your risk accordingly.
Copper Rebounds After a Healthy Correction
Earlier in the year, we made a bullish call on copper prior to China cutting smelter production. What ensued was a shock to the entire global copper market, where the price of copper rose from $3.50 - $5, and pulled back to $3.90/lbs. The speculators got whipped out, and the smart investors and traders, took their money out for profits, and seem to have redeployed money, back into the metal.
In our March newsletter - we mentioned the structural supply side of copper is extremely tight. And there will be opportunities to make money on trade, but our main focused continues to be on the long-term trend for copper. We believe that if the supply side of the equation doesn’t get fixed sooner rather than later, we will be looking at a $5lbs copper price going into 2025.
We continue to hold our positions below for the long-term, but will trim if price action moves a little more aggressively than usual. MUX is a prime example of this - and the stock could be a nice vehicle to trade in and out for those who aren’t as patient as we are. The other two are positions we accumulate when we see opportunities - we remain bullish on Chile for copper exploration plays.
See our updated core copper positions below
Warren Buffet is sitting on a BOATLOAD of Cash - Why ?
In last month’s newsletter - I made a bold prediction, that would likely take some time to play out. It's bold enough, I am prepared to back it up with this one fact from one of the greatest investors of our lifetime.
When Warren Buffet is hoarding $300B cash in US treasuries (T-Bills), this should tell you he must know something that a lot of other people don’t.
In addition to that, Buffet sold roughly $982M of BAC of stock - sounds very similar to 2008….
This is why in the next rate cutting cycle - I continue to believe, TLT is where you will want to continue to have some cash put to work. Read last months newsletter to get a better understanding.
Hint: Buffet has most of this cash sitting in US Treasuries, paying him 3-5% to wait - not to mention, he holds more in US Treasuries than the entire FED balance sheet - thats a shitload of liquidity for when Mr. Buffet goes bargain hunting again!
The Recessionary Trade is Rolling
The trade we missed was Utilities, but this is something that is likely to continue. The XLU is up almost ~20% YTD and the TSX peer is up about 5% - there’s a possible catch up trade here in our view, and we think this trend will continue. Utilities will continue to rise in this next rate cutting cycle - and will likely continue into the recessionary period in both Canada and the United State. We’ve allocated about $4,500 into the TSX peer - historically, Utilities tend to do really well in a rate cutting cycle - however this does signal a recession so we would want to balance out some of the liquidity. If there becomes an overextension in the price actions, we will trim and roll it back into a CASH ETF.
🇺🇸 XLU - YTD chart
🇨🇦 XUT chart - YTD
Natural Gas Contango - Are We in for a Cold Winter?
A name we spoke about in our April newsletter was Pine Cliff Energy.
After the stock sold off over the last several months, it has seemed to have found its footing in the short-term. The company has reported a solid Q2 and in a natural gas market that is almost unheard of in terms of pricing - that being a depressed summer and significantly strong outlook on future gas prices - the forward strip is showing a significant demand increase.
This name is not a big short position, meaning anyone who tries to short this thing, will need to endure significant borrowing costs, due to its dividend and payout - and the company has strong shareholder base as well.
CEO, Phil Hodge - writes a quarterly newsletter to all of shareholders providing great context on the current natural gas and LNG market. We’re happy to share the most recent one with you - please send an email to dan@newgenmindset.com and I’ll forward it off to you.
Some weakness in the chart right now is another opportunity to put this name on your watchlist - especially if future natural gas prices will be trending higher (contango - more on this in a bit).
The technical set-up is good as well - the key support at $0.85 will form a double bottom (which is bullish) and getting in and out of the stock right now is pretty straight forward.
A colder than expected winter, will certain by the icing on the cake - we could see a run to $1.39 if it breaks above $1.04/share.
The best part is - Phil will pay you a dividend while you wait. I don’t know many small caps under a dollar, that will pay you 6% to wait.
Below is a chart shows you just how strong PNE’s free cash flow yield is, relative to its pears. Its a pretty compelling opportunity get a dividend from a small-cap, while we wait for winter.
More on the Contago in Natural Gas prices - forward strip is indicating a move higher - how high will be determined by how cold the winter season is, particular in the Northern parts of the US and of course, Canada (duh!).
Not to mention, Natural gas just had its best month in August, returning 12.33% - and right now is the time to look at these names, as winter begins to approach.
Wrapping Up
That’s all for this month! If you found any of this helpful on your investment journey, feel free to share it with your friends—or even your frenemies.
We value your feedback, so don’t hold back—we can handle the blunt truth.
We’ll catch you next month as the world continues its chaotic spiral. Just remember: where there's mayhem, there are always new opportunities waiting to be seized.
Until next month.
*DISCLAIMER* - READ CAREFULLY
None of the information taken within this newsletter should be considered investment advice and should only be viewed for information purposes only. NewGenMindset is not a broker, or a licensed provider of financial services. All claims made in this newsletter to any listener should not be viewed as offering personalized legal or investment counseling. Any investments made in any companies should be consulted with a licensed financial professional from here on.