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Weather: Showers and thunderstorms, mainly after 2pm. High near 87. Light and variable wind becoming east 5 to 10 mph in the morning. Winds could gust as high as 16 mph. Chance of precipitation is 80%. New rainfall amounts between a tenth and quarter of an inch, except higher amounts possible in thunderstorms. Tuesday Night: Showers and thunderstorms likely before 11pm, then a slight chance of showers between 11pm and 2am. Partly cloudy, with a low around 74. South wind around 7 mph. Chance of precipitation is 60%.
- Daily weather briefing from the National Weather Service in Jacksonville here.
- Drought conditions here. (What is the Keetch-Byram drought index?).
- Check today’s tides in Daytona Beach (a few minutes off from Flagler Beach) here.
- Tropical cyclone activity here, and even more details here.
Today at a Glance:
In Court: It’s trial week, with Circuit Judge Dawn Nichols presiding over the trial of Quinntavus Kwame Jordan, who faces a charge armed robbery and the possibility of a 30-year prison sentence if convicted, while Senior Judge Terence Perkins has returned to preside over the trial of Joao Paulo Fernandes, who turned down a plea deal of serving one year in prison for a hit-and-run charge, and would face up to 15 if he is convicted. Both trials begin at 8:30 a.m., in Courtroom 401 for Jordan, 301 for Fernandes.
The Palm Coast City Council meets at 9 a.m. at City Hall. For agendas, minutes, and audio access to the meetings, go here. For meeting agendas, audio and video, go here.
Food Truck Tuesdays is presented by the City of Palm Coast on the third Tuesday of every month from March to October. Held at Central Park in Town Center, visitors can enjoy gourmet food served out of trucks from 5 to 8 p.m.–mobile kitchens, canteens and catering trucks that offer up appetizers, main dishes, side dishes and desserts. Foods to be featured change monthly but have included lobster rolls, Portuguese cuisine, fish and chips, regional American, Latin food, ice cream, barbecue and much more. Many menus are kid-friendly. Proceeds from each Food Truck Tuesday event benefits a local charity.
The Flagler Beach Library Writers’ Club meets at 5 p.m. at the library, 315 South Seventh Street, Flagler Beach.
Random Acts of Insanity Standup Comedy, 8 p.m. at Cinematique Theater, 242 South Beach Street, Daytona Beach. General admission is $8.50. Every Tuesday and on the first Saturday of every month the Random Acts of Insanity Comedy Improv Troupe specializes in performing fast-paced improvised comedy.
Notably: This explains why golf and tennis clubs and golf clubs are struggling. It’s a boomer thing. From Statista: “After a period of slow but steady growth, pickleball saw a 21-percent jump in participation in 2020, when the Covid-19 pandemic forced Americans to find ways to stay active outdoors. That was only the beginning though. According to the Sports & Fitness Industry Association (SFIA), 4.2 million Americans played pickleball at least once in 2020. Since then, participation has more than tripled, reaching 13.6 million in 2023. The sport’s sudden growth has led to some tensions, however, particularly with the tennis community. As pickleball gained popularity, some tennis players and clubs began to view it as a threat rather than an opportunity. The popular practice of repurposing tennis courts for pickleball to meet growing demand has sparked concerns among tennis enthusiasts, who argue that the noise from pickleball, different playing styles and the reduction in available tennis courts could negatively impact their sport. Some tennis clubs have so far resisted the inclusion of pickleball, fearing it might lead to a decline in tennis participation. Despite these tensions, pickleball continues to thrive, appealing to a wide demographic from retirees to younger players looking for a social, less physically demanding alternative to tennis. The sport’s inclusive nature – you can pick up a paddle and have fun from day 1 – has only fueled its growth, even as it faces opposition from the more established tennis world. Interestingly, the same dynamic can be observed with the game of padel, which has taken large parts of Europe by storm in recent years and has faced the same skepticism from the tennis community.”
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The Live Calendar is a compendium of local and regional political, civic and cultural events. You can input your own calendar events directly onto the site as you wish them to appear (pending approval of course). To include your event in the Live Calendar, please fill out this form.
August 2025
Flagler Beach Library Writers’ Club
Flagler Beach Planning and Architectural Review Board
Palm Coast City Council Meeting
Bunnell Planning, Zoning and Appeals Board
Random Acts of Insanity Standup Comedy
Palm Coast Code Enforcement Board Meeting
Separation Chat: Open Discussion
Flagler Beach Library Book Club
The Circle of Light A Course in Miracles Study Group
Weekly Chess Club for Teens, Ages 9-18, at the Flagler County Public Library
Flagler County Republican Club Meeting
Palm Coast Council and County Commission Joint Workshop on Animal Control
Flagler Beach Parks Ad Hoc Committee
For the full calendar, go here.
One day, sitting in Western Biological, Joseph and Mary saw a chess board and, finding that it was a game and being good at games, he asked Doc to teach him. J and M easily absorbed the characters and qualities of castles and bishops and knights and royalty and pawns. During the first game Doc was called to the telephone, and when he returned he said, “You’ve moved a pawn of mine and your queen and knight.”
“How’d you know?” the Patrón asked.
“I know the game,” said Doc. “Look, Joseph and Mary, chess is possibly the only game in the world in which it is impossible to cheat.”
Joseph and Mary inspected this statement with amazement.
“Why not?” he demanded.
“If it were possible to cheat there would be no game,” said Doc.
J and M carried this away with him. It bothered him at night. He looked at it from all angles. And he went back to ask more about it. He was charmed with the idea, but he couldn’t understand it.
Doc explained patiently, “Both players know exactly the same things. The game is played in the mind.”
“I don’t get it.”
“Well, look! You can’t cheat in mathematics or poetry or music because they’re based on truth. Untruth or cheating is just foreign, it has no place. You can’t cheat in arithmetic.” Joseph and Mary shook his head. “I don’t get it,” he said.
It was a shocking conception, and he was drawn to it because, in a way, its outrageousness seemed to him like a new, strange way of cheating. In the back of his mind an idea stirred. Suppose you took honesty and made a racket of it-it might be the toughest of all to break. It was so new to him that his mind recoiled from it, but still it wouldn’t let him alone. His eyes narrowed. “Maybe he’s worked out a system,” he said to himself.
–From Steinbeck’s Sweet Thursday (1954).
Skibum says
The orange buffoon in the WH still cannot get Rosie O’Donnell or Hillary Clinton out of his head. The thought of both of these strong women have disturbed him so much that it is no wonder he is still up at 3 am tweeting extremists nonsense in all caps on his phone, unable to sleep. Poor drumph, who lets them live with free rent in his little mind after all these years.
Rosie and Hillary have flummoxed him to the point that I now wonder if drumph too has grown a worm in his little brain, having the audacity to even create a fantasy that he could, by an unconstitutional presidential decree, strip U.S. citizenship from Rosie or any other U.S. born American just because he hates her. Well I’m sure feelings are mutual, LOL!
The larger issue, of course, is that no U.S. president has the unilateral authority to singularly, with a stroke of his pen, take anyone’s citizenship away. And especially for an individual like Rosie O’Donnell, who has committed no crime whatsoever. She made the personal choice to move her family to Ireland like so many other American citizens who live overseas for various personal or professional reasons – all of whom retain their U.S. citizenship unless they make an informed choice to give it up.
Get over it, baby donnie. Go off into some corner and suck that fat thumb of yours… but don’t you dare stay there too long because you will soil your diaper.
Ray W, says
Raw Story reports that shortly after the Labor Department’s release of June’s consumer price data, President Trump took to Truth Social to proclaim that “Consumer Prices LOW. Bring down the Fed Rate, NOW!” He then demanded that Fed Chair Powell immediately cut the federal lending rate to American banks and other lending institutions by three points.
The problem with Trump’s Truth Social post is that over the last 12 months the average CPI inflation rate was 2.7%, and that June’s monthly inflation rate on its own was 0.3%. Anyone who can multiply 0.3% by 12 will know what the annualized inflation rate would be if inflation did not go up or down for 12 months straight.
NPR reported that May’s annualized CPI data was 2.4%, significantly below June’s 2.7%. And that June’s year-over-year “core” inflation figure (stripped of data from the more volatile energy and food categories) was 2.9%, far above the Fed’s policy target rate of 2.0%.
According to the NPR reporter:
“Economists closely watch core prices because they typically provide a better sense of where inflation is headed.”
The NPR reporter added:
“Powell and other Fed officials have emphasized that they want to see how the economy evolves as the tariffs take effect before cutting their key short-term rate. The Fed chair has said that the duties could push up prices and slow the economy, a tricky combination for the central bank since higher costs would typically lead the Fed to hike rates while a weaker economy often spurs it to reduce them.”
According to the Associated Press, the 0.3% inflation rate for June was the highest since this past February. The AP reporter wrote:
“It comes down to ‘Trump’s sweeping tariffs,’ which ‘are pushing up the cost of a range of goods, including furniture, clothing, and large appliances, …”
The AP also noted that appliance prices rose for the third straight month and that grocery prices were up 0.35% for the month (multiply that by 12, too). Gas prices were up 1% for the month (I remind FlaglerLive readers that the Iran strikes last month rattled the oil marketplace for a time).
Make of this what you will.
Me?
Fed Chair Powell is right, in my estimation, to repeatedly plead caution in the face of on-and-off-again tariff policies. No one knows how it will all turn out. Cutting lending rates in the middle of a chaotic man-made economic environment might be the absolute worst thing to do.
2.9% core inflation is not low. 2.2% core inflation might qualify as low, but 2.9% does not. Nonetheless, the leader of the professional lying class that sits atop one of our two political parties apparently feels comfortable enough with his base to lie to the public about negative inflation data just hours after its, data that shows a rise in the annualized inflation rate.
From my perspective, one month’s data is of little importance, as even a month is considered by economists to be a relatively volatile term of time, though I note that at one time last year the year-over-year inflation rate had dropped to as low as 2.2% before it ticked up slightly for two months, and then settled, before ticking up again.
No doubt Dennis C. Rathsam will soon be laundering Trump’s Truth Social lie, as he has been doing with other lies for years.
He will claim, as he so often claims, that Biden destroyed the economy, when the pandemic was the proximate cause of the economic destruction.
He will claim that we are in the glory years of a Trump economy, as he recently claimed. In time, perhaps, he might be proved right on this last point, but not right now.
Ray W, says
The Telegraph reports that the Trump administration in now deporting immigrants who once possessed legal immigrant status under the Temporary Protective Status (TPS) program, a program that has been used by several presidents, including former President Biden, to permit entry of immigrants from war-torn lands.
Purportedly, over the past few weeks, more than 700,000 TPS program immigrants have lost that status, including 11,700 Afghans. According to the Afghanistan Analysts Network, which tracks the status of Afghans in the U.S., the 11,700 Afghans who are in the TPS program are but a part of the roughly 200,000 Afghans who entered the country under numerous other programs during and after the American exit in 2021.
Make of this what you will.
Me?
I have not forgotten that several gullibly stupid FlaglerLive commenters roasted the Biden administration for getting only 70,000 or so Afghans out of the country during an admittedly botched 2021 exit strategy; they didn’t mention in their comments that for the entire 2020 year, the Trump administration had approved the entry into our country all of 213 Afghans, even after the April date of the signing of the Trump agreement with the Taliban meant that our government knew it had to exit the country 12 months later.
I have not forgotten that several gullibly stupid FlaglerLive commenters roasted the Biden administration for the quick collapse of the Afghan army; they did not mention in their comments that after the Trump administration signed the agreement with the Taliban, it forced the Afghan government to return to the Taliban their leader, who had been in Afghan government custody for years. Alongside the leader’s return to the Taliban, thousands of other Taliban fighters had to be released out of Afghan government custody back to the Taliban under Trump administration pressure.
I have not forgotten that several gullibly stupid FlaglerLive commenters roasted the Biden administration for having left behind billions of dollars of military equipment, including armored personnel carriers, tanks, Humvees, helicopters, etc.; they didn’t mention in their comments that had the American military removed all that materiel, we would have denuded the Afghan army of all of its armaments, an army that we spent 19 years building up.
I have not forgotten the several gullibly stupid FlaglerLive commenters who roasted the Biden administration for not having developed a database listing the names and contact information for those thousands of Afghans who had admirably and bravely assisted American forces over the nearly 20 years that we were in the country; they didn’t mention in their comments that the truth was that Congress had passed an act early in the war, an act enabling the creation of such a database, but no one during the remaining years of the two Bush administrations worked on creating the database, that no one during the years of the two Obama administrations worked on creating the database, and that no one during the years of the first Trump administration worked on creating the database.
Where are the gullibly stupid commenters now, when our government has announced its intent to deport so many vetted Afghans without a hearing? What will happen to those who helped us over the decades that we were fighting in the country now that the Taliban knows they assisted the American military in time of war?
11,700 Afghans are at risk of return to Afghanistan.
The cruelty of it all stuns the imagination.
As an aside, CBS Evening News reported months ago that some 40,000 Afghans who were still living in that war-torn nation had been approved for entry into the U.S. prior to the Trump inauguration. Three days after Trump’s inauguration, the reporter wrote, he signed an executive order blocking their entry. A judge ordered withdrawal of the ban. The Trump administration responded by defunding the program. Now, according to the story, those approved for entry who had helped us during the war can enter if they can pay the airfare themselves. Who knows the impact of the recent removal of TPS status on those immigrants?
Ray W, says
According to a story published by the Telegraph, during the decades that the British army fought alongside Americans as coalition forces, the British government compiled a list of those Afghans, and their family members, who helped during the fight; it numbers some 25,000 people.
In 2022, the Taliban claims that it obtained from the internet a leaked copy of the list after a Royal Marine mistakenly it there; the Taliban is said to have since developed what is called a “kill list” and hired special units tasked with tracking the helpers down.
According to a family member of one of the hunted who had fled to Iran:
“It’s putting everyone in the family at risk — being related to someone on a Taliban kill list is a death sentence. They have all his details – his name, his wife’s name, even his children’s names.
“We were shocked when they listed him. If they can’t find him, they’ve said they’ll kill another family member instead. ‘The blood of a spy is in your veins,’ they told us.”
Make of this what you will.
Ed P says
Two words. DECOY FLARES
Until the Dems also accept Mark Cuban’s revelation of just saying “Trump Sucks” won’t win anything, Dems will remain ineffective.
Trump and his cabinet are moving at warp speed, deploying the Rosie O’ type decoy flares on a daily basis. The outrageous comments and actions are doing exactly what they are designed to do, draw the democratic heat seeking missiles. Prompting the Dems to appear to be chasing fire flies or butterflies without a net. The Dems are is a constant state of chaos and moving too far left. Focusing on Alligator Alcatraz. Really?
Critics, strategists, and fools all underestimated Trump. Mocked that he wasn’t even capable of even playing checkers, too stupid to play chess.
Maybe it’s dumb luck? But just in case it’s not….
Short of railing against your country and praying for a full blow depression ( rather unpatriotic) , Cuban’s suggestion is about the only other option.
Ray W, says
Reuters reports that the most recent San Francisco Fed “Economic Letter”, released yesterday, predicts that, should certain economic assumptions come to pass, the Trump tariff scheme could “boost U.S. manufacturing jobs and real income in a majority of states, but lower employment and income adjusted for inflation in the country as a whole.”
“Assuming a 25% increase in U.S. tariffs on imports from Canada and Mexico, 30% levies on Chinese goods, and 10% on the rest of the world, economists at the regional Fed bank estimated a 0.2% drop in U.S. employment over the next four years, as a reduction in U.S. services and agricultural jobs overwhelms a projected jump in manufacturing employment.”
Thirty-one of our states would see increased inflation under the assumed economic model, but the rest of the states would see declines, with an overall 0.4% drop in U.S. real income.
Fed researchers acknowledged that theirs was not a “precise” forecast, as actual tariffs might be higher or lower than the assumptions used in the study.
Make of this what you will.
Steve says
It all depends on how much money Desatan can get to blow this off.
Good luck
Ray W, says
Business Insider reports that earlier today, Russia’s Labor Minister, Anto Kotyakov, stated during a meeting with President Putin focusing on demographics and healthcare that by 2030, the Russian economy is going to need 10.9 workers that it does not currently have, because 10.1 million Russians will retire in that timespan and 800,000 new jobs will be created.
The problem?
In 2024, Russian women birthed 1.22 million babies, and 1.82 million Russians died. Many Russian men have been killed or wounded in the Ukraine. Many other Russians, including many of the best educated, have left the country.
Last August, a think tank known as Atlantic Council published a study predicting that Russia’s demographic outlook is so dire that its current population of 146 million could halve by the end of the century. Businesses are turning to the elderly and teenage children to find workers. Wages are up, fueling inflation.
According to the reporter, “Putin has made population growth a national priority, calling it a matter of ‘ethnic survival’ and encouraging women to have as many as eight children.” Conference attendees spoke of cash payouts and tax breaks for parents of large families.
Make of this what you will.
Me?
I have read multiple articles about Russia’s labor shortage. When the Soviet Union dissolved, the ensuing economic chaos led to suicides, mass drinking leading to early deaths, and a crash in the number of babies being born. In the years after the dissolution, the lifespan of men dropped from the mid-60s to the high-40s. During harsh economic times, it seems, women stop having babies. The Russian birthrate never rebounded to above replacement rate.
A terrorist act just after Russia invaded the Ukraine that was blamed on Tajiks resulted in a mass expulsion of Tajik immigrants. Russian recruiters raid immigrant locations, impressing them into the army and sending them to the Ukraine. Immigration has largely stopped.
When last I looked, Russia’s unemployment rate was listed as 2.5%, a figure economists say almost guarantees high inflation, though I have read older reports that had unemployment as low as 2.1%. While Russia’s inflation rate is officially somewhere around 10%, knowledgeable economists say it is far higher. The central bank’s lending rate was recently reduced to 20% from 21%. Business lending rates range from 35% to 40%. Russia’s biggest farm equipment factory shut down early because too few farmers can afford the loan interest rates to purchase equipment. The factory usually shuts down after the harvest so that farmers who have money can buy equipment, but not this year.
Ray W, says
A CNBC reporter wrote of the status of EVs in Norway.
After years of government economic policies, ranging from tax exemptions to reduced fees, Norway reached EV automotive market share penetration of 88.9% in 2024, up from 1% in 2010. Thus far in 2025, according to government data, more than 93% of new cars sold in the country are EVs.
Said Cecilie Knibe Kroglund, Norway’s State Secretary in the Ministry of Transport:
“We have a lot of tax incentives and user incentives, which are the most important things, and also infrastructure, of course.”
For the entirety of the transportation base, EV market share has in Oslo reached 40% of all vehicles, including used vehicles, and 30% of all vehicles in a number of other populated areas of the country, though those regions are more concentrated in the south.
As Norway has no automobile manufacturing base, there isn’t any car making lobby, which lack of a lobby, according to the reporter, is thought to have benefitted the country.
Norway’s public bus fleet is expected to fully transition to electric power later this year, and the heavy-duty truck fleet is expected to reach 75% EV share by 2030.
One criticism raised by some of those opposed to Norway’s EV transition plan is that the greater use of EVs is prompting Norwegians to drive their EVS instead of either walking or cycling.
Make of this what you will.
Ray W, says
The Wall Street Journal has a new story about Canada’s Prime Minister, Mark Carney’s, position on the current tariff “row” between Canada and the U.S.
For the first time since Canada entered into tariff negotiations, PM Carney mentioned the possibility that U.S. tariffs on Canadian goods may be permanent:
“‘There is not a lot of evidence right now, with regards to negotiations, of any country or jurisdiction’ escaping U.S. tariffs.”
CIBC Capital Markets’ chief economist, Avery Shenfield, told investors in a client note:
“Canada’s insistence on fully tariff-free trade with the U.S., especially in autos and steel, ‘isn’t going to get [Canada] very far towards a trade deal now, and could even generate a backlash from the president.”
Make of this what you will.
Me?
If it is indeed true that Canada offered during trade negotiations to go fully tariff-free in all of its imports of American goods, and if it is indeed true that Trump repeatedly said that his goal is to eliminate foreign nation tariffs on U.S. exports because foreign tariffs cause unfair trade practices, then what is the hold up to a trade deal? Why is PM Carney intimating that he expects that U.S. tariffs on Canadian goods will be permanent?
Ray W, says
The Washington Post reports on a blog post by Invidia announcing that the Trump administration, after banning the sale of one version of its computer AI chips to China in April, has just approved Invidia’s right to apply for an export license to sell that chip. According to Invidia, the Trump administration has already “assured” the company that the export license would be approved.
The administration change of position comes after last month’s London agreement to “roll back some trade restrictions.”
The reporter tied the April ban on the AI chip sale to China’s restriction on exports of rare earth metals.
Said Paul Triolo, with DGA-Albright Stonebridge Group:
“The leverage Beijing gained from putting in place a licensing system regime around rare earths and magnets caught U.S. official and industry by surprise.”
Likewise, in recent weeks, China not only loosened restrictions on the export of rare earth metals to the U.S. but it also approved an acquisition by the software company Synopsys of another company, Ansys, a deal previously held up by Chinese regulators.
Make of this what you will.
Me?
From prior readings on this subject, the U.S. banned the sale of a particular Invidia AI chip to China due to concerns of their dual-use capability, meaning that the chips could be used for both civilian and military purposes. And maybe they can be put to both purposes.
Back to the story.
Commerce Secretary Howard Lutnick said to CNBC on Tuesday that Invidia’s AI chip has become outdated; it isn’t “one of Nvidia’s cutting edge ones” as the WP reporter described it; Lutnick added that the administration wants China to become “addicted” the American technology ecosystem.”
“We want everyone to use our technology stack, our way of thinking about AI and let the world be balanced on ours. … Now, really, it’s a competition between the American standards and the Chinese standards.”
A former Commerce Department official who wishes to remain anonymous told the WP reporter that “[i]t’s very hard to disentangle China’s AI ambitions for the commercial space from the military space. … [T]here’s plenty of open source and classified intelligence showing that the PLA (People’s Liberation Army” was working quite hard to get its hands on these chips.”
Can it be successfully argued that the importance of Invidia’s AI chip, at least in the short-term, given the sixty-year history of computer chips becoming outdated seemingly overnight, is demonstrated by the fact that China, upon learning of the U.S. ban, restricted the sale of its rare earth metals and magnets to the U.S. to the point of American car assembly plants having to shut down for lack of magnets?
It makes little sense to me for China to shut off exports of critical resources to the U.S., unless it really wanted or still wants those chips.
Ed P says
Ray W,
Any input about the month of June having a budget surplus? 27 billion is barely notable in the federal budgets red ink. A one month aberration, maybe?
Any research exposing that major corporations are using the tariffs to arbitrarily raise prices even on products not affected by tariffs? Aka, price gouging?
Neither of the above comments in themselves revels any significant economic news. Especially since it’s only been 7 months since Trump was inaugurated. However, neither does pointing out every other economic trend on an hourly basis.
Appears to be censorious.
Pogo says
@Trump blows, too
…and Mel dresses him funny, but it does seem fair to say his diaper is at the very least — half full.
Laurel says
Daily observation: At Publix, one can of Lindsay Black Olives is $ 3.59. But, as luck would have it, the Publix brand is a mere $2.59. For one can. Black olives.
Aldi’s Roth chocolate bar was $1.79. Yesterday, it was $2.99. Well, that’s at least better than $4-$5 you know where.
So, do you figure prices will drop considerably when the tariff bullshit is over? Will it be over?
Do y’all remember why the tariffs began? Because other nations weren’t paying their fair share, 2% of their GDP to NATO. Now, Trump is threatening 50% tariffs on Brazil because he doesn’t like the way Brazil is treating his buddy Bolsonaro, an authoritarian leader.
This is not 3D chess, this is the dumbest, most self centered checkers ever.
Ray W, says
Much is being made these days of a political movement to remove Fed Chair Powell early from his second appointment to a four-year-term as chair. Many argue that a replacement chairman would or should bend to the President’s wishes and immediately reduce the Fed’s lending rates to commercial lending institutions by as much as 300 basis points, or 3%.
But could a new Fed Chair act on his or her own?
I found some interesting language in a Fortune article focusing on that subject:
“… [T]he Federal Open Markets Committee is composed of 12 people, plus a rotation from the 11 regional Fed banks, and those people in turn are supported by 500 or so researchers and economists who – unlike the president – are simply trying to accurately record what is going on in the economy. They aren’t all going to roll over and lower the interest rate if they know that inflation is destroying the value of American money.”
Make of this what you will.
Me?
The Federal Open Markets Committee meets a number of times each year. Not monthly, but more often than every other month.
Twelve voting members, including the Fed Chair, attend every FOMC meeting, but five more voting members rotate in and out, chosen from the 11 branch Feds. The purpose is to better ensure the widest possible range of economic viewpoints.
At the conclusion of each FOMC meeting, the seventeen member economists vote on what to do that month, what to adjust, what to allow to remain the same.
At the last FOMC meeting two of the seventeen participating economists voted to lower the lending rate.
After the conclusion of each meeting, Fed Chair Powell announces the collegial decision of the 17 members. He doesn’t tell the public that he decided a path; he says we decided a path.
Weeks later, minutes of the meeting are published, but no actual transcript.
So, here is the question: What if President Trump decides to remove Fed Chair Powell and replace him with a more pliable economist? What if, at the next FOMC meeting, 16 of the 17 members disagree with the new and more pliable Fed Chair by recommending that the lending rates remain the same?
What if the new and more pliable Chair decides to act on his or her own to lower lending rates, in defiance of the measured recommendations of 16 other members of the FOMC, who base their decisions on the efforts of 500 economists and researchers?
Think this through.
We know that the minutes of the meeting would be published. We know that we would find out the vote. What would the actions of a rogue chairman do to the markets, if investors realized that the Fed was no longer independent from the political whims of the moment? What if the Fed came to be perceived all over the world as a no longer credible institution? What if investors realized that the Fed had become subservient to the political whims of the party in power.
We cannot forget that from the beginning over 100 years ago Congress mandated that an independent Fed would focus on only two things: Managing, not manipulating, the economy and creating jobs. Any Fed decision that strays from those two mandates violates the Fed’s mission.
The Fed has a number of tools at its disposal to accomplish its two mandates. Quantitative easing and quantitative tightening come to mind, as does raising or lowering or leaving alone the Fed’s lending rate, not to individuals, but to lending institutions. The amount of credit that is available to lending institutions can be raised or lowered. Each of these options can be used to either stimulate or tamp down the economy.
History records that, after the end of the brief recession in 2020 brought on by the economic shock of the pandemic, the Fed responded by lowering several times the lending rate to financial institutions, eventually to as low as zero percent, and by increasing by some $3 trillion the amount of credit available to those same institutions to lend to consumers.
A boon in refinancing of existing mortgages ensued, as well as a frenzy of new home purchases followed, as 30-year fixed-rate mortgages offered by lenders to buyers dropped to as low as 2.7%.
Millions of homes were purchased. Millions of existing mortgages were refinanced. Home prices skyrocketed as buyers competed for homes. Median home prices are only now beginning to level off.
Certain FlaglerLive commenters erroneously blamed the Biden administration for the resulting rise in home prices and rents, just as they always do for anything they don’t like. They were wrong, as they so often are.
People had acted in their own perceived selfish best interest, knowing that they could buy a home at an interest rate of 2.7% that might in the long run turn out to be a lower cost than the long-term inflation rate.
I did the same in 1983, when I bought a distressed three/two home with a two-car garage for $32k. I sold it four years later for $52k, right at the time that stagflation was ending. Yes, I painted the house and fixed damaged or broken items, and I restored the lawn to some decency, but I made zero major renovations. Given the stagflation of those so-long-ago days, millions of people were doing the same. If inflation raised home prices faster than the prevailing mortgage rates, money was there to be made.
It was the pandemic, and the Fed’s response to it, that caused in part the inflation of rising home and rent prices.
It was Trump’s signing into law Congress’ command to pump $2.9 trillion into an ailing economy that caused in part the inflation of the time. I have read one economist’s claim that the total stimulus sum signed into law by Trump was $6 trillion, but I haven’t yet found a corroborating claim.
It was Biden’s decision to sign into law Congress’ command to pump another $3 trillion into an ailing economy that caused in part the inflation of the time.
Each of the three are responsible for the inflation that plagued us all, but each of them, too, deserve any credit that flows from their efforts to enable a recovering economy.
Ed P says
Laurel,
Your anecdotal jabs at the tariffs are just that, anecdotal. Proves nothing.
Moser Roth chocolate sold primarily at ALDIs is imported from Germany and is at worse subject to a 10% tariff. If tariffs were driving the increase you posted, about 18 cents would be equal to 100% of any tariff. If one looks beyond misleading assumptions, cocoa prices globally had surged 300% in 2024 and still climbing. Overall impact would lead to maybe another 10% increase. Something else drove the retail price increase beyond normal costs.
Linsey olives are grown in California. What? Specifically the Lindsey brand is associated with Bell-Carter Foods. Look no further than the San-Joaquin Valley and the Sacramento Valley as the source. Tariffs are not a price factor.
In conclusion, in general some prices are going to increase due to tariffs, routine manufacturing price increases, and even price gouging. When all the dust settles on the tariff wars, the average tariff cost passed through onto the consumer will be nominal and expected not to reach double digits, ie less than 10% across the board maximum. If energy prices ( gasoline/diesel/ natural gas) drop, those saving alone will help ameliorate some of the tariff sting and possibly eliminate them. (Shipping/transportation)
Finally, the only time a consumer product price rollback would occur is when a product reaches it inelasticity pivot point. When the cost reaches the point that consumers make alternate choices. A manufacturer can lose profitability or volume short term, but can never lose both and survive. A new competitor may also cause a short term response but remember large public corporations are slaves to share holders who demand profitability.
Laurel says
Ed P: Well, that was exhaustive. I’m not blaming the tariffs for all price raising, I’m blaming corporations, but tariffs are not helping. And yes, as you have called it, tariffs are war.
Why are we at war? Because all countries have “taken advantage of us?” That’s ridiculous. We have very happily gobbled up all the foreign nick knacks for years now. No one made us.
When does Trump ever explain the economics of his tariff war policy? He doesn’t. More “weave”? How do you know it will effect us “nominally” in the end? You don’t. Who should we listen to, economists or Trump, who never explains the details…ever?
Now for shopping. In my opinion, Publix is no longer “Where shopping is a pleasure,” Yesterday, my husband witnessed another couple in shock, staring, and commenting, at the outrageous prices. The wealthy tourists don’t mind, but the locals go over the bridge looking for a break, and finding not very much of one. Trump is certainly not helping us there, either, like he said he would, though Dennis believes every things got cheaper over night.
I am mildly used you checked out the price of Aldi’s chocolate. Trump needs all the help he can get