RealClearMarkets Articles

There will be no Social Security benefit cuts in 2032. For former congressman and longtime budget scold Tim Penny to say otherwise is not only unoriginal, but also dishonest. And that’s not a defense of Social Security. Social Security has always been an unnecessary retirement plan wrapped into a tax increase. The tax increase worked brilliantly for Congress when workers paying the higher tax well outnumbered retirees, but now they don’t. Lost on Penny is that Social Security’s impending “insolvency” explains precisely why Congress should do nothing about it. But...

On October 28, the Federal Reserve held its benchmark rate at 3.75 to 4 percent, and two of its voting members wanted another increase. President Trump wants rates cut to 1 percent or lower. The two sides disagree about nearly everything except one assumption: that a committee in Washington sets the price of money for the country. A retiree's bank statement says otherwise. With that benchmark near 4 percent, the average savings account paid 0.38 percent in August and the average 12-month CD 1.71 percent. The best 12-month CDs paid around 4.35 percent in September. The 30-year mortgage has run...

Over the past decade, freight shipments have steadily shifted towards highway trucks over railroads. The reason is straightforward, although not entirely beneficial: trucks, generally, have been faster. That’s not to say trucks are more efficient, however. In fact, railroads are by far the most fuel-efficient way to move cargo over land, and they produce about 75 percent less emissions than trucking. They also cause significantly fewer injuries and fatalities than trucks. And trucking is about to get faster still. Driverless trucks are already hauling paid freight across Texas and the...

Headline Index Rises to 48.5 as All Three Components Advance and 17 of 21 Groups Improve; the Investor–Non-Investor Gap Sets a Second Straight Record at 25.3 Points Consumer sentiment improved for a third straight month in November as the RealClearMarkets/TIPP Economic Optimism Index, the first monthly reading of U.S. consumer confidence, rose to 48.5 from 46.8 in October, a 1.7-point (3.6%) gain. In its final reading before today's midterm elections, the index reached its highest level since February, and all three of its components advanced. Unlike October, the gains were broad: 17 of...

If you’re selling your goods into the marketplace, you’re trading with the whole world. The previous truth requires mention as the economically challenged at the New York Times and CNBC claim Nvidia was diverting or smuggling restricted Nvidia AI chips to China in violation of export controls. The analysis indicts the economic knowledge of reporters today, not Nvidia. But we’re getting ahead of ourselves. Traveling back in time, it’s easily forgotten that "Arab oil" continued to flow into the United States after the 1973 embargo of the U.S. by Arab members of OPEC....

The Trump administration is cutting government red tape for flying—and the online outrage machine would have observers believe the sky is falling. But relaxing Uncle Sam’s micromanagement of the travel economy is not the end of the world. In fact, history suggests returning greater autonomy to airlines functioning in a free market is a good thing for passengers.  Rewind the clock five decades, and boarding an airplane in the U.S. was a luxury that only the wealthy could afford. Federal bureaucrats controlled where airlines could fly and how much they could charge, leaving...

In February, Haveli Investments completed a majority investment in Sirion, a contract-management software maker, buying out earlier backers including Sequoia and Tiger Global. The deal is a clean template for a pattern we are seeing across private markets: a company grows into a durable, profitable business at a growth rate that no longer clears the bar its original investors need, and a buyout firm steps in to own the next chapter. The middle of a venture fund's portfolio is where these companies live — profitable or nearly profitable, growing too slowly for venture math to pencil out,...

In his Commonplace newsletter, Oren Cass announced that if 2024’s rate of job losses in manufacturing had continued, there would be 272,000 fewer manufacturing jobs today than there are now. He presents this improvement as a vindication of the Trump trade agenda and tells tariff skeptics to find a new talking point. But extending a line on a graph doesn’t establish what caused any departure from the line. Cass needs to explain why manufacturing would have continued losing jobs at 2024’s pace without the president’s tariffs. Instead, he treats that assumption as...

In August, I wrote in RealClearMarkets that the artificial-intelligence boom was beginning to look like a high-tech version of the classic agricultural hog cycle. The argument wasn't that AI was a fad or that the technology would fail. It was simpler: when everybody sees the same opportunity and expands at the same time, individually rational decisions can collectively produce too much capacity. The question eventually stops being how exciting the breakthrough is and becomes whether the cash returns can justify the concrete. Apparently, “eventually” arrived faster than...

I want to thank Sarah Wilson for her recent piece in the Harvard Law School Forum on Corporate Governance (Rule 14a-8: Perhaps There’s Another Way). In her October 7 post she went looking for what The Heritage Foundation has actually said about Rule 14a-8, and she found it. She cites a December 2024 Heritage report on ESG and DEI, which worked through the bills then circulating to tighten the rule and rejected the one that would have stripped out the federal requirement to include proposals at all. The Businesses Over Activists Act went “a step too far,” Heritage wrote. Its...

Americans face a high-stakes choice between two competing economic visions. One makes it easier to build, invest, and grow. The other puts government control ahead of free enterprise. New York City has already gone down the latter path, where a self-described socialist is in charge of the world’s financial capital. The riots in France show what happens when socialist ideas, like those pushed in New York City and other progressive redoubts, become national policy. Across the country, Americans are expressing clear policy preferences by flocking to states that embrace economic freedom....

Today, the White House Office of Trade and Manufacturing Policy, which I direct, released a comprehensive new report and companion video documenting an emerging American manufacturing renaissance.  Almost on cue, the Institute for Supply Management supplied the exclamation point.  The ISM Manufacturing Index jumped a full point in October to 55.5, beating Wall Street expectations of 54.7 and marking the tenth consecutive month American manufacturing has been in expansion territory.  This is not statistical noise. It is Trumpnomics at work.  The internals are even stronger...

In a profits and loss sense, a mutual insurance company is a fiction. That’s because the policyholders are the company. Which is a crucial distinction, one that recalls a famous motto. “We put people before profits.” Readers are familiar with it, and it’s one that reasonable people can make wise arguments for and against. It’s no doubt true that corporations exist at the pleasure of shareholders, which is why a sound case can be made that the best corporations reverse the order of the quoted motto. Conversely, those who embrace it can easily make a case that...

The Federal Reserve does not set interest rates. If it did, the U.S. economy would be desperately depressed and the Fed’s actions not worth talking or writing about. More realistically, there’s production. Interest rates spring from the latter. No one borrows money, rather people borrow market goods, services, and labor. And since the economics of every borrower are different, so is the interest rate charged every borrower. College tuition is a market good, and it’s no different. George Will has made the crucial point that if colleges and universities were able to charge...

In an October 18 New York Times guest essay, "I Teach at a Business School. It's Time to Shut Them Down," Cambridge professor Christopher Marquis argues that business schools train students to put profit ahead of the public good. Most of the responses since have been gentle. They concede that he raises valid concerns and dispute only the remedy. Marquis has the problem backward. Business schools are not failing because they teach profit maximization. They are failing because they stopped. In my own business programs, ethics and social responsibility were not confined to a single course. They...

After officially ceasing operations this past July, the Department of Government Efficiency is now the subject of two competing books. Michael Lewis’s Blockersintroduces us to six righteous deep state rebels, featuring in breathless tones “one story of the high-stakes D.C. standoff where security chief Colin O’Brien fought off DOGE operatives.”  Tyler Hassen’s Inside DOGE is a look at the U.S. Department of Interior, is less prosaic but more illuminating “18 different chief Inside DOGE information officers and more than...

In 2000, Best Buy wanted to build its corporate headquarters in Richfield, Minnesota. There was one obstacle: the Walser automobile dealerships owned land the company wanted, and negotiations failed to produce a voluntary sale. Rather than find another location or offer terms the owners would accept, Best Buy sought government assistance. Richfield exercised eminent domain, compelling the transfer of the property for private development. The Minnesota Court of Appeals upheld the taking, and an evenly divided state Supreme Court left that ruling standing. The transaction was legal. But was it...

“Genesis Digital was ‘one of Bankman-Fried’s most reckless investments.’” That's from the Wall Street Journal, in an article citing the views of the bankruptcy team that sold it off. FTX invested $1.15 billion in Genesis Digital, only for the bankruptcy administrators to sell it for $500 million in June of 2026. The Journal reports it’s presently worth over $6 billion. And so it goes. With it continues the fiction that FTX account holders were storing savings with the crypto brokerage, and that FTX founder Sam Bankman-Fried "stole" $8 billion of their...

President Donald Trump recently named his new AI czar, tapping Director of National Intelligence Jay Clayton to help lead America in the global race over a technology that will define the coming century. In a change from previous AI advisors, it is crucial that Clayton build AI policy that serves the American people, rather than investors.  Clayton, a former federal prosecutor and SEC chairman, isn’t a Silicon Valley investor, but the role he is stepping into received heavy scrutiny under his predecessor, David Sacks, because of Sacks’ long ties to Silicon Valley. Sacks, a...