Show Notes
In 1914 the Fed ran on 40 people and no computers. Today it takes 23,000. Fire them all and let AI do it... it can't do any worse.
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Kevin Warsh delivered his first congressional testimony as Fed Chair, and Peter Schiff breaks down a hearing where everyone discussed inflation while misdefining the term and ignoring their own role in causing it. June CPI came in at -0.4% versus the expected -0.1%, dropping year-over-year inflation to 3.5% — but the entire decline came from a temporary oil price drop that is already reversing as the Iran war reignites and oil climbs back 20% in July. Bond yields tell the real story: the 30-year is back near 5.1% and the 10-year near 4.6%, erasing nearly the entire post-CPI rally.
Schiff's biggest revelation from the hearing: the Fed employs 23,000 people to do a job that required just 40 when it opened in 1914 — with no computers — and argues the entire institution could be replaced by a single AI or abolished outright. He dismantles Warsh's claim of "regime change" at the Fed as being as fake as regime change in Iran, exposes the redefinition of "price stability" to mean prices that rise just slowly enough that people stop complaining, and shows how the 2% target was always a lie invented to justify inflation. He covers Warsh admitting inflation is a tax while planning to keep levying it, the court throwing out Trump's self-negotiated IRS settlement that granted his family immunity, and the AI CapEx bubble turning tech's biggest cash generators into massive borrowers that will break the bond market.
Chapters: 00:00 AI Spending Arms Race 01:08 Markets Brace for CPI 06:07 CPI Surprise and Gold Whipsaw 07:34 Oil Driven Inflation Mirage 11:40 What Inflation Really Means 14:11 Congress and Fed Share Blame 17:58 Fed Headcount Shock 22:32 Two Percent Target Myth 27:05 Regime Change and Price Stability 33:40 Day One Recap Continues 34:09 Grow My X Account 35:13 Congress Inflation Theater 36:06 Trump Grift Claims 37:30 IRS Settlement Outrage 39:51 Rates Versus Balance Sheet 41:08 Who Wins Low Rates 43:46 Fed And Black Workers 49:09 AI Bubble Warning 51:15 Hyperscalers Debt Spiral 55:38 Bond Market Breaking Point 58:16 Strategy Stock Dilution 01:00:30 Bitcoin Levels And Regrets 01:01:30 Subscribe And Sign Off
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