College Football, Donny & Jerry—and Gold

Come autumn, the tailgate parties will commence as my favorite time of year begins: College Football Season.

Now, just to be clear, today’s dispatch has nothing to do with college football. It’s just the venue for the point I need to make. That point being: Credibility, and more particularly, the loss thereof and how that shapes expectations.

See, back in the spring, the National Football League fired three referees involved in a scandal in which they apparently rigged professional games with controversial calls that supposedly helped the KC Chiefs win close games.

But the NFL did more than fire the trio…

It relegated them to the ranks of college football referees—a way for the NFL to attempt to rehabilitate the pigskin scofflaws while at the same time bypassing grievance processes that are baked into the NFL Referees Association.

Right there—dumping these three refs into the college football world—is where we come to our turn into today’s message.

See, these refs are known by name, and the NFL has pawned them off into college football’s so-called Power 5 conferences—the most competitive conferences in college ball… which also means these are the conferences where fans are rabid and have slightly less than zero tolerance for referee shenanigans.

So you already know that going into the season, any game in which any of these three refs are officiating is going to be a game where credibility is shot before the coin toss.

Which ultimately brings me to Donald Trump, Jerome Powell, and the Federal Reserve…

That segue is not as odd as you might be thinking.

Donny is none-to-pleased with Jerry.

Jerry has kept US interest rates untouched since 2024. And since then, the world—particularly Wall Street—has been talking about the rate cut that has not yet arrived.

Heck, I’ve been talking about that rate cut too—saying the Fed was likely to cut this summer, possibly as early as May. Well… May came and went and no rate cut. Same with June. Will July continue the trend? We will find out soon enough…

But Donny has been especially vociferous about his demand that Jerry get off the pot and cut rates. Donny wants those rates down at 1% again, what would mark a very drastic series of cuts. (The current Fed Funds target rate is 4.25% to 4.5%.)

Thing is, I’m no longer sure a rate cut makes sense.

Or maybe the better way to say that is, “I understand why Jerry is disregarding Donny.”

The Trump Tariffs are beginning to ripple through the US economy in the form of inflation. Companies including Walmart, Target, Best Buy, Nike, Procter & Gamble, toymaker Mattel, Ford, food giant Conagra Brands, Stanley Black & Decker, AutoZone… and many, many others have all announced that tariffs are jacking up their costs, so they’re raising prices that US consumers pay.

At the moment, the American economy is no-man’s land. There are hints that more inflation is on the way, confusingly mixed with data that shows inflation is relatively tame (though not yet at the Fed’s preferred 2% rate).

Jerry is standing there in the middle of no-man’s land, looking left and right and (rightly) waiting to see which way inflation runs. If it heats up across the summer, well, it’s likely a clear sign that tariffs are breeding inflation, and he won’t want to cut rates into an inflationary surge.

If, however, inflation runs the other way, then he will have the cover he needs to start trimming rates a bit (though not towards 1%).

But here’s the much bigger theme in all of this…

Donny doesn’t care about the economy. Donny cares about how much money he can spend on his pet projects, namely providing tax cuts to the billionaires and the businesses that supported his campaign.

To do that, though, he needs to find cost savings somewhere.

Cutting interest rates to 1% would go a long way toward that mission.

Per Lael Brainard, a former director of the National Economic Council and once the vice chair of the Federal Reserve:

President Donald Trump has said the quiet part out loud. His threats to terminate Federal Reserve Chair Jerome H. Powell if Powell doesn’t cut interest rates are motivated by one simple desire: to make it cheaper for the administration to add about $4 trillion to the federal debt.

Last week, the president sent Powell a handwritten note: “You should lower the rate — by a lot! Hundreds of billions of dollars being lost!”

In a public event promoting the $4 trillion Republican budget bill, he spelled out his wishes even more clearly: “We have to work hard with cuts on that. And this guy could do it so easily. … But every [interest rate] point … [means we’re losing] $300 billion. So if we got it down to 1 percent we’re talking about almost a trillion dollars in saving just with a stroke of a pen. No work, no missing anything. Just like an accounting situation.”

There you have it: The Fed should just cut rates to 1 percent (a cut of more than 3 percentage points) to reduce the debt-service costs on the trillions added to the national debt by the GOP mega-law.

Now, let’s get to my worry (and also our opportunity): gold prices.

See, because Jerry isn’t playing by Donny’s house rules, there’s talk that Donny wants to  install a “shadow chair” who would carry Donny’s water at the Federal Reserve, even as Jerry tries to run the joint the way he sees fit.

And that brings us back ‘round to those three NFL referees who face credibility issues in college football this fall.

Whoever Donny appoints to run the Fed is going to have immediate credibility problems. Everyone except the most sycophantic propogandist is going to know that “Donny’s Fed chair” is going to make sure the Fed, an extra-government agency designed to be entirely independent of politics, will do what Donny wants.

That’s not a stretch, given the actions this year of just about every cabinet member he has appointed.

Wall Street and global investors—particularly global bond buyers—are going to have none of it. Faith in the US is already plunging, witnessed by the dollar’s worst start to the year in more than half a century—plunging 11% against other currencies—and the fact that global buyers are skipping US Treasury auctions.

With a puppet in the Fed chair’s role, serious investors are going to fold, toss their cards onto the table, and take their money back to Europe, Asia, and elsewhere. That’s my worry for the US economy.

But what that means for gold prices is where our opportunity lies…

Gold is going go see a string of new all-time highs as the metal makes a beeline for $5,000.

And that’s a chance for all kinds of gold-related profits that far outpace the rise in gold’s price—such as with the investments I’ll be covering in my Gold Masterclass tomorrow. (One of the gold recommendations I shared with my Global Intel readers has already seen 65% gains this year—nearly tripling gold’s rise in the same period.)

On the football field, losing credibility as a referee exposes you to a cacophony of boos, especially if you make a controversial call that benefits one team over another at a crucial moment in the game.

In the financial markets, losing credibility is far more costly… particularly if you’re America and you control the world’s reserve currency.

Once the markets determine that the Federal Reserve chair is nothing more than flunky carrying the president’s water—no different than what happens in any dictatorship or authoritarian economy—the dollar dives and gold soars even higher.

Question is: Do you own gold?

Better to start loading up on gold now, while you still can, because Donny has shown that his second term is all about appointing loyal water-carriers to every position of importance in the government and the economy.

As such, investors and the economy face a high likelihood that whoever he appoints to replace Jerry is going to face credibility issues from the get-go, and that will be reflected in an even weaker dollar… and even higher gold prices.