Economy

[Separation Scientist]

1 hour ago, OlDawg said:

The Fed’s target rate is 2%. There will never be 0% inflation.

We don't want 0%. 2%-2.5% is the target inflation.

Trump has reduced Bidens hyperinflation from 9% down to his 2.7%. Still a tiny bit of work to do but it came WAY down from Biden. Gas is very cheap for summer driving too. It normally goes way up but it did not this summer. Yeah, Trump did that!    

[OlDawg]

41 minutes ago, Boyz N Da Hood said:

We heard inflation for 4 years like that was the issue.. obviously it never was, supposedly it's back to where we were pre pandemic yet hardly any changes in prices.. arguably worse in areas

Many things affect prices. Wages, government spending, disease among crops/livestock/poultry, weather, war, energy, tariffs…

Inflation is never caused by a single item problem.

The current tariffs aren’t effecting prices at this time. This is a shell game being played by producers/sellers to squeeze a little more profit, and a general excuse for poor company performance. Good management teams are doing just fine as the markets attest.

Tariff costs will hit. But, mainly Brazil. The others are already incorporated into costs. The effective, all-inclusive tariff rate is about 13-15%. Producers are basically absorbing the 10%. With the passage of the BBB, real wage increases (increases minus inflation) should wind up around $3500-$10k/yr. for the average family making ~$70k/year. Obviously, those not paying income tax now will have minimal benefit. That’s where increased medical costs may hurt them.

Medical costs will need to be addressed, or there will be major sticker shock.

I’d expect produce, coffee, chocolate, and beef all to rise in price. But beef is as much due to the screwworm invasion, drought, and low domestic cattle numbers as it is tariffs on Brazil. We only import 20% of our beef from Brazil. Shelf stable items should remain about the same as what they are currently.

I still expect a 50 basis point cut by the Fed in September. I could be wrong. But, they’re behind the 8 ball as I mentioned earlier.

[OlDawg]

2 minutes ago, Separation Scientist said:

We don't want 0%. 2%-2.5% is the target inflation.

Trump has reduced Bidens hyperinflation from 9% down to his 2.7%. Still a tiny bit of work to do but it came WAY down from Biden. Gas is very cheap for summer driving too. It normally goes way up but it did not this summer. Yeah, Trump did that!    

Correct. You don’t want 0% inflation.

[OlDawg]

All bets are off if the court rules Trump can’t impose tariffs in the manner he has used. I’d expect that decision to come out by mid to late next month.

Also, I’m FIRMLY against the Trump Administration looking to take a 10% stake in Intel. This is no better than Soylndra, or any other ‘too big to fail’ venture. This is a form of socialism/communism, and shouldn’t even be on the table. We’ve (Biden Admin) already given Intel over $10 Billion, and they’ve done nothing. The government has no business using our money to take a stakeholder position in any company.

Very disappointed in him even contemplating this fiasco.

[OlDawg]

A little worried Powell (a lawyer--not an economist for those that didn't know) won't cut rates in September. He seems to be relying way too much on backward looking data & some strange sense of precognition of what he thinks tariffs MIGHT do. Real data actually shows a slowing job market, and businesses beating their earnings estimates by 2x.

As usual, he's gonna' be late to the game, and have to make more adjustments because of either:

• His personal dislike of Trump.
• He's forgotten the dual core mission of the Fed is to maintain the dollar at a constant value, and seek full employment. Nothing more.
• An ingrained belief that he can see the future even though data says otherwise.

He's killing the housing market, and hurting small business' ability to borrow and hire. We'll be lucky if he doesn't run us smack dab into stagflation.

(That said, if you happen to have some spare laying around right now, there are some decent bargains on the pullback of this week. Personally, I wouldn't hesitate. There's no signs of a recession on the horizon. Find a good dividend payer, and buy at a discount. Especially if you're younger, and have time on your side.)

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DISCLAIMER: I'm not an analyst. Simply someone who was a FIRE movement member before anyone even knew what it was, and have been living on investments for over a decade. So, I do keep a pretty close watch.

 

 

[LumRaiderFan]

21 minutes ago, OlDawg said:

A little worried Powell (a lawyer--not an economist for those that didn't know) won't cut rates in September. He seems to be relying way too much on backward looking data & some strange sense of precognition of what he thinks tariffs MIGHT do. Real data actually shows a slowing job market, and businesses beating their earnings estimates by 2x.

As usual, he's gonna' be late to the game, and have to make more adjustments because of either:

• His personal dislike of Trump.
• He's forgotten the dual core mission of the Fed is to maintain the dollar at a constant value, and seek full employment. Nothing more.
• An ingrained belief that he can see the future even though data says otherwise.

He's killing the housing market, and hurting small business' ability to borrow and hire. We'll be lucky if he doesn't run us smack dab into stagflation.

(That said, if you happen to have some spare laying around right now, there are some decent bargains on the pullback of this week. Personally, I wouldn't hesitate. There's no signs of a recession on the horizon. Find a good dividend payer, and buy at a discount. Especially if you're younger, and have time on your side.)

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DISCLAIMER: I'm not an analyst. Simply someone who was a FIRE movement member before anyone even knew what it was, and have been living on investments for over a decade. So, I do keep a pretty close watch.

 

 

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From the article:

Unless the Fed and Jerome Powell get their act together, our real estate ecosystem will become one large stagnation.

[thetragichippy]

5 minutes ago, LumRaiderFan said:

Unless the Fed and Jerome Powell get their act together, our real estate ecosystem will become one large stagnation.

I'm trying to get back to Hardin county and their is not much "new" showing up. I look twice a day at Realtor.com. People are sitting on their homes waiting for the rates to drop to upgrade or move......

[OlDawg]

Trump Admin doesn’t need to be talking anything about socialism or communism any more after taking a 10% stake in ownership of Intel & having the Pentagon becoming the largest shareholder in a critical mineral mining operation.

I understand the needs. But, this is no different than the CCP.

Spin it how you want. This is communism at its core, and it’s picking winners & losers. Totally against free market principles.

From a practical standpoint, the last time the government made a move like this (GM in 2008), we wound up losing $10 Billion.

[LumRaiderFan]

28 minutes ago, OlDawg said:

Trump Admin doesn’t need to be talking anything about socialism or communism any more after taking a 10% stake in ownership of Intel & having the Pentagon becoming the largest shareholder in a critical mineral mining operation.

I understand the needs. But, this is no different than the CCP.

Spin it how you want. This is communism at its core, and it’s picking winners & losers. Totally against free market principles.

From a practical standpoint, the last time the government made a move like this (GM in 2008), we wound up losing $10 Billion.

Making moves like this for the sake of “national security” is alarming, but we’ve had a portion of socialism mixed in for a while, mainly health related, which if completely controlled by government, which many want, is the best way to gain control over the masses.

[OlDawg]

20 minutes ago, LumRaiderFan said:

Making moves like this for the sake of “national security” is alarming, but we’ve had a portion of socialism mixed in for a while, mainly health related, which if completely controlled by government, which many want, is the best way to gain control over the masses.

This isn’t socialism. This is direct intervention in industrial policy. This is government ownership.

The U.S. is charging Nvidia a 15% cut of revenue for any GPU shipped to China since it’s illegal under the Constitution to charge an export tariff. They’ve negotiated a golden share with veto powers over corporate decisions to allow Nippon to buy U.S. Steel. The Pentagon will be the major stakeholder in the mine discussed previously. Now this with Intel.

THIS is communism.

I guess Qualcomm and TI can just close up shop. Next, they’ll force Nvidia to sell tech to Intel, or they’ll tariff them to death. The mine will receive any permits required before any other competitor, and EPA regs will be lax.

Even the most fervent Trump supporter—if they believe in free market capitalism at all—can’t think this is a good progression of policy.

[LumRaiderFan]

16 minutes ago, OlDawg said:

This isn’t socialism. This is direct intervention in industrial policy. This is government ownership.

The U.S. is charging Nvidia a 15% cut of revenue for any GPU shipped to China since it’s illegal under the Constitution to charge an export tariff. They’ve negotiated a golden share with veto powers over corporate decisions to allow Nippon to buy U.S. Steel. The Pentagon will be the major stakeholder in the mine discussed previously. Now this with Intel.

THIS is communism.

I guess Qualcomm and TI can just close up shop. Next, they’ll force Nvidia to sell tech to Intel, or they’ll tariff them to death. The mine will receive any permits required before any other competitor, and EPA regs will be lax.

Even the most fervent Trump supporter—if they believe in free market capitalism at all—can’t think this is a good progression of policy.

Do you think this is worse the Fannie Mae, Freddie Mac or the Federal Reserve?

[OlDawg]

5 minutes ago, LumRaiderFan said:

Do you think this is worse the Fannie Mae, Freddie Mac or the Federal Reserve?

Yes. It’s directly owning private entities. Entirely different animal. It’s ’Too Big to Fail’ with a controlling purpose—on purpose.

[LumRaiderFan]

11 minutes ago, OlDawg said:

Yes. It’s directly owning private entities. Entirely different animal. It’s ’Too big to fail’ with a controlling purpose—on purpose.

I see your point but government can basically own an industry without being an actual partner.  If you read the real Anthony Fauchi by JFK jr, the government basically owns pharmaceutical companies and definitely picks winners and losers and rewards government employees with payoff  when drugs are approved.  

[baddog]

What I found….

No, the Pentagon becoming a stakeholder in a mine is not a form of communism

. While it is a form of government intervention in the economy, communism is a much broader economic and political ideology that seeks to abolish private property and class systems. The Pentagon's investment is instead a targeted intervention for national security purposes within a capitalist framework. 

Why the Pentagon's investment is not communism

• Not an abolition of private property. In communism, the state or community owns all the "means of production" (factories, mines, etc.). The Pentagon's recent 15% stake in the rare earth mineral miner MP Materials does not change its status as a publicly-traded company. MP Materials remains a private business, with the Pentagon as its largest single shareholder, not its sole owner.
• Driven by national security, not ideology. The investment's purpose is to secure a domestic supply of critical minerals for military and technological applications. This action is a form of industrial policy intended to counter China's dominance in the rare earth market and reduce U.S. dependency on foreign sources.
• Part of a capitalist system. The Pentagon's move can be categorized as a public-private partnership, a tool used in capitalist economies. The CEO of MP Materials explicitly stated the investment is "not a nationalization" and that the company remains "shareholder driven". This is different from the state control of industry seen in historical communist states.
• The US government owns other businesses. The US government already owns and operates a variety of enterprises, known as government corporations or state-owned enterprises, including the U.S. Postal Service and Amtrak. These specific, targeted ownerships for public benefit or strategic interest also do not make the country communist. 

[OlDawg]

1 minute ago, LumRaiderFan said:

I see your point but government can basically own an industry without being an actual partner.  If you read the real Anthony Fauchi by JFK jr, the government basically owns pharmaceutical companies and definitely picks winners and losers and reward government employees with payoff  when drugs are approved.  

I don’t have an issue with incentives, subsidies, or ‘completion bonuses.’ Again, that’s not crossing the line into direct ownership.

The Administration could just as easily have offered incentives to a couple major players, and let them compete. Put some bait out in front of Qualcomm, Intel, and TI. Give them a goal. See who wins.

Intel hasn’t been relevant since the IPhone. To masquerade them as a great company is a joke at best. But, that’s beside the point.

I think you understand where I’m coming from…

[OlDawg]

6 minutes ago, baddog said:

What I found….

 

No, the Pentagon becoming a stakeholder in a mine is not a form of communism

. While it is a form of government intervention in the economy, communism is a much broader economic and political ideology that seeks to abolish private property and class systems. The Pentagon's investment is instead a targeted intervention for national security purposes within a capitalist framework. 

Why the Pentagon's investment is not communism

• Not an abolition of private property. In communism, the state or community owns all the "means of production" (factories, mines, etc.). The Pentagon's recent 15% stake in the rare earth mineral miner MP Materials does not change its status as a publicly-traded company. MP Materials remains a private business, with the Pentagon as its largest single shareholder, not its sole owner.
• Driven by national security, not ideology. The investment's purpose is to secure a domestic supply of critical minerals for military and technological applications. This action is a form of industrial policy intended to counter China's dominance in the rare earth market and reduce U.S. dependency on foreign sources.
• Part of a capitalist system. The Pentagon's move can be categorized as a public-private partnership, a tool used in capitalist economies. The CEO of MP Materials explicitly stated the investment is "not a nationalization" and that the company remains "shareholder driven". This is different from the state control of industry seen in historical communist states.
• The US government owns other businesses. The US government already owns and operates a variety of enterprises, known as government corporations or state-owned enterprises, including the U.S. Postal Service and Amtrak. These specific, targeted ownerships for public benefit or strategic interest also do not make the country communist. 

This is a joke, major spin, and an excuse. Period.

It’s justification for government intervention in any business they desire under the cover of National Security.

Whoever wrote the excuses/examples of USPS and Amtrak should be taken out and horse whipped. How stupid do they think people are?

[LumRaiderFan]

20 minutes ago, OlDawg said:

I don’t have an issue with incentives, subsidies, or ‘completion bonuses.’ Again, that’s not crossing the line into direct ownership.

The Administration could just as easily have offered incentives to a couple major players, and let them compete. Put some bait out in front of Qualcomm, Intel, and TI. Give them a goal. See who wins.

Intel hasn’t been relevant since the IPhone. To masquerade them as a great company is a joke at best. But, that’s beside the point.

I think you understand where I’m coming from…

I do understand where you’re coming from but the incentives that occur in the pharmaceutical industry are borderline criminal bribery in my opinion and government has 100% of the say (without having ownership), and the losers are the American people.

I don’t like this latest move either, anytime this can is kicked a little further down the road is alarming.

[baddog]

8 minutes ago, OlDawg said:

This is a joke, major spin, and an excuse. Period.

It’s justification for government intervention in any business they desire under the cover of National Security.

Whoever wrote the excuses/examples of USPS and Amtrak should be taken out and horse whipped. How stupid do they think people are?

It’s a Google search. The rest of the post made sense.

[OlDawg]

6 minutes ago, baddog said:

It’s a Google search. The rest of the post made sense.

I’m not slamming you. Just ridiculing the twisting to get the spin in the material posted.

USPS and Amtrak were both government entities before they were private/government partnerships.

You know this. That’s why I said it was comical.

[OlDawg]

13 minutes ago, LumRaiderFan said:

I do understand where you’re coming from but the incentives that occur in the pharmaceutical industry are borderline criminal bribery in my opinion and government has 100% of the say, and the losers are the American people.

I don’t like this latest move either, anytime this can is kicked a little further down the road is alarming.

I haven’t read the book. So, I’m not as familiar as you. But, I don’t doubt you one iota.

[baddog]

6 minutes ago, OlDawg said:

I’m not slamming you. Just ridiculing the twisting to get the spin in the material posted.

No offense taken, but I still think the first 3 paragraphs make sense. The USPS and Amtrak comment was lame.

[OlDawg]

4 minutes ago, baddog said:

No offense taken, but I still think the first 3 paragraphs make sense. The USPS and Amtrak comment was lame.

This is one of those situations where a person can agree with many policies, but vehemently disagree with others—for entirely different reasons.

[OlDawg]

2 hours ago, baddog said:

It’s a Google search. The rest of the post made sense.

BTW, here’s the difference in answers on searches pending your personal search history and the engine used.

I thought it would be interesting to see the differences since I’ve noticed quite a few using the AI search/compile features in their posts lately.

This is the summary from my search on DuckDuckGo—which doesn’t keep a record of your personal searches and compiles using Chat GPT. I used the search criteria ' U.S. Government taking a stake in MP Materials'.

(Again, no slam on your post from Google. Just question how the sources Google used warped conservatism/libertarianism and free market principles into an excuse and justification by defining communism into a very broad, abstract idea.)

NOTE: I'm a free market, conservative libertarian as far as fiscal/economic policy regardless of administrations.

Search Assist

The U.S. government's acquisition of a controlling stake in MP Materials, a rare earth mining company, has drawn comparisons to state capitalism and communist practices, particularly due to its significant influence over a critical industry. Critics argue that this move resembles the government control seen in communist states, as it allows for direct intervention in the market.

Government Stake in MP Materials
The U.S. government's acquisition of a controlling stake in MP Materials, a rare earth mining company, has raised significant concerns and comparisons to state capitalism, particularly in relation to communist principles.

Key Aspects of the Acquisition
    •    Nature of the Deal: The Pentagon invested $400 million in preferred stock, convertible to common stock, making it the largest shareholder in MP Materials. This investment is aimed at enhancing domestic production of critical minerals.
    •    Market Influence: By becoming a major stakeholder, the government now has substantial influence over the rare earths market, which is crucial for national security and various industries, including defense and technology.

Comparisons to State Capitalism
    •    State Control: Critics argue that this move resembles state capitalism, similar to practices in China, where the government exerts control over key industries. The arrangement allows the government to dictate terms and potentially distort market competition.
    •    Concerns from Experts: Industry experts have expressed worries that this level of government involvement could lead to unfair advantages for MP Materials over competitors, echoing concerns about market manipulation typical of state-backed industries.

Conclusion
While the U.S. government’s actions are framed as necessary for national security and economic stability, the implications of such a significant stake in a private company have sparked debates about the nature of capitalism in the U.S. and its alignment with more centralized, state-controlled economic models.

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[baddog]

14 minutes ago, OlDawg said:

BTW, here’s the difference in answers on searches pending your personal search history and the engine used.

I thought it would be interesting to see the differences since I’ve noticed quite a few using the AI search/compile features in their posts lately.

This is the summary from my search on DuckDuckGo—which doesn’t keep a record of your personal searches and compiles using Chat GPT.

(Again, no slam on your post from Google. Just question how the sources Google used warped conservatism/libertarianism and free market principles into an excuse and justification by defining communism into a very broad, abstract idea.)

Search Assist

The U.S. government's acquisition of a controlling stake in MP Materials, a rare earth mining company, has drawn comparisons to state capitalism and communist practices, particularly due to its significant influence over a critical industry. Critics argue that this move resembles the government control seen in communist states, as it allows for direct intervention in the market.


Government Stake in MP Materials
The U.S. government's acquisition of a controlling stake in MP Materials, a rare earth mining company, has raised significant concerns and comparisons to state capitalism, particularly in relation to communist principles.

Key Aspects of the Acquisition
    •    Nature of the Deal: The Pentagon invested $400 million in preferred stock, convertible to common stock, making it the largest shareholder in MP Materials. This investment is aimed at enhancing domestic production of critical minerals.
    •    Market Influence: By becoming a major stakeholder, the government now has substantial influence over the rare earths market, which is crucial for national security and various industries, including defense and technology.
Comparisons to State Capitalism
    •    State Control: Critics argue that this move resembles state capitalism, similar to practices in China, where the government exerts control over key industries. The arrangement allows the government to dictate terms and potentially distort market competition.
    •    Concerns from Experts: Industry experts have expressed worries that this level of government involvement could lead to unfair advantages for MP Materials over competitors, echoing concerns about market manipulation typical of state-backed industries.

Conclusion
While the U.S. government’s actions are framed as necessary for national security and economic stability, the implications of such a significant stake in a private company have sparked debates about the nature of capitalism in the U.S. and its alignment with more centralized, state-controlled economic models.

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I see what you are saying. Possibly I asked a different question. I think MP Materials should review their shareholders. It seems that Shenghe Resources owns stock and is the primary customer. There is so much going on that we don’t jnow about. This is what I found…….

 

Shenghe Resources, a Chinese rare earth company, holds a significant minority stake in MP Materials, the company that owns the Mountain Pass rare earth mine in California. As of July 2025, with the U.S. Department of Defense becoming the largest shareholder, Shenghe's stake will be surpassed. Historically, Shenghe was MP Materials' primary customer, purchasing a large portion of its rare earth concentrate, but MP Materials has ceased shipments to China as of April 2025 and is accelerating its own processing and magnet manufacturing facilities. 

 

 

Shenghe's Shareholding

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  Shenghe Resources holds a significant minority share of MP Materials, which has been reported as approximately 7.7% to 8%. 

   
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   as Largest Shareholder:

  In July 2025, the U.S. Department of Defense (DoD) acquired preferred stock in MP Materials, making it the largest shareholder and surpassing Shenghe's stake. 

   

Relationship Evolution

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  Shenghe was a major customer for MP Materials, purchasing the majority of its rare earth concentrate produced at the Mountain Pass mine for processing in China. 

   
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  MP Materials ceased shipments to China in April 2025 and is actively building its own separation and manufacturing capabilities, reducing its reliance on Shenghe as a customer. 

   

Strategic Context

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  Shenghe's stake has been a point of concern for U.S. policymakers, including Senator Lisa Murkowski, due to its potential influence on a critical rare earth resource. 

   
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  MP Materials is expanding its downstream capabilities, including separating and refining its concentrate and building a magnet manufacturing facility, to reduce dependence on China and its processors