A User's Guide to Political Theater
The 'Mar-a-Lago Accord' meets the Federal Reserve... Hypocrisy on all sides... Political theater, televised... Lower rates are coming regardless... Red flags from the labor market... On it goes...
The coiner of the 'Mar-a-Lago Accord' is up for a Fed job...
That's Stephen Miran, the current chairman of the White House's Council of Economic Advisors. And here's what his "interview" looked like today...
Miran spent much of the day in front of the Senate Banking Committee on Capitol Hill regarding his nomination to the Federal Reserve's voting board. He'd serve the remaining four and a half months of Adriana Kugler's term after she resigned unexpectedly one month ago.
During today's testimony before a bipartisan group of senators, Miran maintained he's serious about the importance of "Fed independence" from political influences. He said in an opening statement...
In my view, the most important job of the central bank is to prevent depressions and hyperinflations. Independence of monetary policy is a critical element for its success.
Democratic senators expressed their doubts.
Miran, after all, is the person who coined the term "Mar-a-Lago Accord" in a November 2024 paper titled "A User's Guide to Restructuring the Global Trading System," which detailed Donald Trump's tariff and macroeconomic agenda.
The phrase "Mar-a-Lago Accord" (introduced on page 28 here) became popular in Wall Street circles to describe Trump's economic plans that also called for a weakening of the U.S. dollar. Lower interest rates are central to that. So Miran's preference is clear.
And in the "you-can't-make-this-up department," senators also used his following words against him in today's hearing – about the inherent conflicts of interest that come up between the White House and Fed...
Short-circuiting the revolving door between the Fed and the executive branch is critical to reducing the incentives for officials to act in the short-term political interests of the president.
Miran wrote the above in a separate research paper in March 2024. That's the same Miran who currently works for the executive branch and plans to return there in a few months after this Fed term expires.
He was asked today: Do you still agree with that statement?
Well, not right now, he said. That idea should be "taken in context of an overall package of reforms and not looked at in isolation," Miran said.
But out of the other side of the mouth, he said that "political interference in monetary policy... can erode [economic] outcomes, and it's important for the Federal Reserve to be insulated from the political cycle."
So, another question: Has anyone in the administration asked you to commit, formally or informally, to vote for lower interest rates?
"Uh, no," he said.
It was hard to believe him.
That's not to say the 'other side' is a paragon of consistency, either...
Take Sen. Elizabeth Warren, part of the Banking Committee, who conveniently often speaks out on monetary policy when it suits her interests and has no self-awareness of her hypocrisy.
As the folks at ZeroHedge pointed out today in a post on social media platform X...
Elizabeth Warren, Sept 16, 2024: "Fed must cut by 75 [basis points] on Sept 18" (the Fed cut by 50 [basis points] two days later)
Elizabeth Warren, Sept 4, 2025 to Stephen Miran: "What you are doing (by pushing for lower rates) will take an axe to Fed independence"
I (Corey McLaughlin) listened to all of 15 minutes of today's Senate questioning of Miran. And even from that little time, I could share countless more examples of Washington ridiculousness. It was political theater, televised.
But here's the important thing from all this...
Whether Miran is on the voting board or not, Fed-influenced interest rates are probably heading lower anyway.
As of today, federal-funds futures traders have put 97% odds on the Fed cutting its benchmark bank-lending rate range by 25 basis points at its next meeting on September 16 and 17. That's up slightly from just yesterday, after a few more concerning signals from the jobs market today, plus a recent speech from Fed Chair Jerome Powell that policy could change soon.
This market reaction tells us that traders believe the Fed has room to cut interest rates in the weeks and possibly months ahead. Based on its dual mandate of balancing "stable prices" with "maximum employment," falling employment calls for lower rates.
Whether this is because the central bank is really "independent" or not, or because Powell just wants to stop being called "stupid," is another matter. But with the labor market looking more concerning than inflation right now, the Fed can justify lowering rates to juice the economy.
Whether this ends up being the "right" or "wrong" move, we shall see. Maybe inflation will take off again, or perhaps it won't... But either way, a cheaper cost of dollars does appear to be imminent.
Diving deeper into yesterday's jobs report...
As we wrote yesterday...
The Labor Department's latest Job Openings and Labor Turnover Survey ("JOLTS") showed that available positions fell to 7.18 million in July.
That might sound like a lot, but it's the second-lowest number since the end of 2020... slightly edging out September 2024.
What's more, that was only the second month below 7.2 million job openings since December 2020. And it was below the Wall Street consensus estimate for 7.38 million openings.
What's more, in the context of the labor market, this month's JOLTS report brought another worrying sign...
For the first time since the post-COVID recovery in 2021, there are now more unemployed people in the U.S. than there are job openings.
Take a look...
Since late 2000, when the JOLTS survey began, the number of unemployed has only jumped above total job openings twice – in 2000 and 2020. Both of those times marked recessions.
It's not a surefire sign that a recession is on the way this time around. But there's a red flag here. For the first time in four years, more folks are looking for work than there are jobs available.
And leading up to this point, folks have spent longer and longer between jobs... hitting a three-year high of 24 weeks in July.
With this new shift, that wait time is only going to get longer. That's more evidence that the job market is weakening and is about to force the Fed's hand.
The market has plenty of jobs data to digest...
Today, we got two more jobs-related releases: ADP's monthly private-payrolls report for August, and another widely followed monthly report on job-cut announcements from the outplacement firm Challenger, Gray & Christmas.
Starting with the ADP data...
U.S. companies added 54,000 jobs in August, according to ADP. That was well below the Wall Street estimate of 75,000, and it's just about half of July's job growth of 106,000.
And four of the 10 industries ADP tracks lost jobs in August.
Next, the Challenger survey showed that U.S.-based companies announced about 86,000 job cuts in August. That was up 39% from July and up 13% from last August. In fact, it was the most August layoffs the survey has found outside of a severe recession. From the release...
August's total was the highest for the month since 2020 when 115,762 job cuts were recorded. After 2020, it is the highest August total since the thick of the Great Recession in 2008, when 88,736 cuts were announced.
Putting it all together, businesses are looking to hire less while announcing recession-level layoffs. That's bad news for the economy.
Setting the stage for tomorrow's payroll report...
The biggest release of the week comes tomorrow morning – with the government's nonfarm payroll report (which also includes the unemployment rate). Remember, it was this report at the start of August that really hiked the market's thirst for rate cuts... and led to Trump firing the Bureau of Labor Statistics commissioner.
As we wrote in the August 4 Digest...
You see, the report showed that the U.S. economy added just 73,000 jobs in July... the unemployment rate ticked higher to 4.2%... and most notably, hiring totals for May and June were revised down dramatically – with a combined 258,000 fewer jobs than initially reported. The new numbers said just 19,000 jobs were added in May and only 14,000 in June, compared to the 125,000 and 147,000 previously stated, respectively.
Not only did the weak jobs report send the S&P 500 Index down 1.6% upon its release, but the odds of a rate cut at the September meeting jumped to 88% from 38%.
It's going to take a huge surprise for stocks to have a big swing on tomorrow's release. Markets have already priced in a jobs market that's softening but not at crisis level. A 25-basis-point rate cut at the Fed's meeting in two weeks is almost guaranteed.
Of course, cutting rates with inflation still above the Fed's "target" of 2% raises the risks of another spike higher and continuing erosion of existing U.S. dollars. But for now, it looks like that's a risk central bankers are willing to take to support the labor market.
As we've written before, lower borrowing costs can add fuel to the economic fire and send asset prices higher in the short term. That also goes for "hard assets" like gold and silver – both of which have soared in recent months.
Gold just hit a new all-time high yesterday while silver has broken out to a 14-year high... all while the major U.S. stock indexes, despite a mild cooldown as of late, are still near records, too. On it goes.
On this week's Stansberry Investor Hour, Old West Investment Management Chairman Joe Boskovich shares a strategy for finding good deep-value companies... explains why you should keep your eyes on precious metals... and warns about selling your stocks too soon.
Click here to watch the full interview now... Subscribe to our YouTube page to watch more episodes, and listen to the entire Stansberry Investor Hour podcast at InvestorHour.com or wherever you get your podcasts...
New 52-week highs (as of 9/3/25): Agnico Eagle Mines (AEM), Alamos Gold (AGI), Altius Minerals (ALS.TO), Atour Lifestyle (ATAT), Barrick Mining (B), Alpha Architect 1-3 Month Box Fund (BOXX), FirstCash (FCFS), VanEck Gold Miners Fund (GDX), VanEck Junior Gold Miners Fund (GDXJ), SPDR Gold Shares (GLD), Alphabet (GOOGL), iRhythm Technologies (IRTC), Kinross Gold (KGC), Grand Canyon Education (LOPE), New Gold (NGD), Novartis (NVS), OR Royalties (OR), Sprott Physical Gold Trust (PHYS), Sprott Physical Silver Trust (PSLV), iShares Silver Trust (SLV), SSR Mining (SSRM), Travelers (TRV), Uranium Energy (UEC), ProShares Ultra Gold (UGL), Valero Energy (VLO), and Wheaton Precious Metals (WPM).
In today's mailbag, feedback on yesterday's Digest and AI's power problem... Do you have a comment or question? As always, e-mail us at feedback@stansberryresearch.com.
"I read your article on data center energy usage and how there isn't enough energy around for them AND the rest of the country. That's really disturbing, but there's another issue. These data centers consume a vast amount of water; a commodity that some places like Texas, Arizona, New Mexico, California can't afford to waste on cooling the centers..." – Subscriber Greg S.
"[The Tennessee Valley Authority] just announced coming price increases to residents in Tennessee, possibly due to Elon Musk's Memphis Supercomputer [at a massive AI 'training' facility called Colossus] greatly increasing energy usage as it has been ramping up electrical usage!" – Subscriber J.P.M.
"The increasing cost of power as an AI problem is likely true. However, the investment in wind and solar over the past decades has been a waste of capital on unreliable generation and driven the cost of power to today's high rates. The green agenda this total fiasco." – Subscriber Dustin S.
"Hi, Corey and Nick, The increase in electricity prices is not simply inflation, but the huge costs to build intermittent power sources and batteries to try and make reliable power sources out of unreliable sources. As some states mandate high levels of unreliable power their costs will explode and are exploding. Thanks." – Subscriber Ken P.
All the best,
Corey McLaughlin and Nick Koziol
Baltimore, Maryland
September 4, 2025