RealClearMarkets Articles

Treasury Secretary Scott Bessett should select his words more wisely. He promises Operation Economic Outcast will be the "economic D-Day" that delivers final victory over the Islamic Republic of Iran. This is an unwise choice of words considering that nine months after allied forces broke out of the Normandy beachhead established on D-Day, World War II in Europe was over. This conflict with Iran is into its seventh month with no conclusion in sight, despite the Islamic Republic’s military power being a non-existent shadow of Nazi Germany’s. A key element of Bessett’s plan is...

There is an old piece of Wall Street wisdom that nearly everyone repeats and almost no one questions: don't try to catch a falling knife. Wait for the dust to settle. It sounds cautious. It feels like discipline.  In my experience, it is one of the most expensive ideas in investing — and I believe it explains exactly where we are in multifamily today. Few people have thought more carefully about this than Howard Marks, co-founder of Oaktree Capital, whose memos Warren Buffett says are the first thing he reads. Marks put it bluntly: “by the time...

Sen. Elizabeth Warren spent months demanding regulators kill Enova International’s bank deal. On Sept. 14 she got her wish. Enova announced a buyback. As funerals go, it was upbeat. Enova withdrew its applications with the Comptroller of the Currency and the Fed, killing a $369 million deal for Grasshopper Bancorp. The same day it reaffirmed guidance, projected roughly 25% third-quarter revenue growth and said it would accelerate repurchases. Its CEO added, with what reads like a shrug, that growth never required a bank. Shareholders took a beating. Borrowers did not. Same loans, same...

Let’s start with the obvious - Artificial intelligence (‘A.I.’) is no longer a futuristic concept waiting to enter healthcare. It is already changing how diseases are detected, how medical information is analyzed and how clinicians make decisions.  The question before us however is no longer whether AI belongs in healthcare - It is whether we will deploy it responsibly enough to make healthcare more personal, proactive and accessible. The scale of the transformation is difficult to ignore. The U.S. Food and Drug Administration’s (FDA) public database contained...

Since OpenAI released ChatGPT in late 2022, America has kept score in the artificial intelligence race by asking which lab has the best model. Unfortunately, that scoreboard is dangerously incomplete. Frontier capability matters, but temporary benchmark leads do not by themselves create durable technological dominance by any single nation. The true national edge comes when its technology becomes the platform on which the world builds. The distinction came into focus at the White House in August. Administration officials met with leading AI companies to discuss a voluntary framework for...

On the left and right, America's leaders increasingly act as if they're playing a populist version of Monopoly. In this one, the “Get Out of Jail Free” card takes the form of one-trick, simplistic solutions to cover up the government causing complex problems. But real life doesn't have that kind of easy out. Policymakers from the White House to both houses of Congress to the state legislatures need to stop playing a game in which...

Great wars often begin over what seem like small stakes. So began—and so proceeds—the American trade war with Canada. Before the guns of February sounded in 2025, commencing President Donald Trump’s protectionist campaign against American trading partners worldwide and a group of islands inhabited exclusively by penguins, more than 99 percent of cross-border trade between the two (mostly) English-speaking nations of North America went on duty-free. In the aftermath of Trump’s dredging up this summer of a heretofore unused section of the Smoot-Hawley Act and the...

The biggest threat to your livelihood is the indolence of others. Or if they’re dead. About death, economic thinkers including Edward Conard and Yuval Levin have long promoted the fiction that much of the world being on its back (or dead) after World War II occurred to the economic advantage of Americans. No, it deprived Americans of much better. What you’ve read isn’t a speculation, it’s basic Adam Smith, or Henry Ford, or Steve Jobs. As Smith reported, and Ford and Jobs revealed through factories in the U.S. (Ford) and all over the world (Jobs), the only limit to...

Economics often presents redistribution as a trade-off between efficiency and equity. The metaphor is familiar. Markets may produce a large pie but distribute it unevenly. Government can redistribute the pie more equally, although taxes, regulation and other interventions may weaken incentives to work, save, invest or innovate. We accept some loss of efficiency in exchange for greater equity. But this familiar formulation leaves out an important variable: power. Government does not redistribute resources mechanically. Someone must administer the process. And when the government controls...

Progress is not defined by what we know, it’s what we no longer need to know. National Review editor Rich Lowry seemingly disagrees. Writing recently at the New York Post, Lowry observed that “someone should take a sledgehammer to every computer and iPad in our schools…Paper books and Number 2 pencils should be the hottest commodities in K-12 education.” That’s one way of looking at schooling, but Lowry might consider it in another way. He would no doubt agree that every single U.S. industry has undergone not one, but countless disruptions of the...

In April the banking agencies adopted a rule, effective July 1, cutting the capital a community bank needs to use the simplified framework Congress told them to build in 2018, from 9 percent of its assets to 8. A bank that elects that framework and clears that number is deemed well capitalized without ever running the risk-based tests that ask what those assets are. In July the 21st Century ROAD to Housing Act raised from $3 billion to $6 billion the asset ceiling below which a bank can be examined every 18 months instead of every 12. On September 10 the Federal Reserve, the FDIC and the...

The courts have not been tolerant of the Trump administration’s legal arguments in support of global tariffs. In February the Administration lost at the Supreme Court, which rejected its “emergency” powers claim under the IEEPA statute. The administration reimposed the tariffs, pivoting to Section 122 of the 1974 Trade Act, which had never been invoked. Section 122 authorizes a president to impose a temporary tariff of up to 15% for 150 days to address a "large and serious United States balance-of-payments deficit." No such deficit exists, at least not by the definition...

The Federal Reserve today unanimously decided to raise its short-term interest rate target by a quarter percentage point to a range of 3.75 – 4.00%, the first hike since mid-2023.  The Fed made two key changes to the statement announcing its decision, declaring that “domestic spending has been resilient” and the rate hike “will support a timelier return” to the Fed’s 2% inflation target.      In the press conference following the meeting, Chairman Warsh emphasized the strength of the US economy and the potential for an acceleration of...

Fed Chair Kevin Warsh just raised interest rates into the teeth of an oil price shock.  It’s a monumental mistake that has Alan Greenspan rolling over in his grave.  Thirty-six years ago, then Fed Chair Alan Greenspan faced strikingly similar circumstances. A hot war in the Middle East and surging oil prices  Greenspan did not hike interest rates.  Instead, the Maestro held rates steady and, over time, as the energy price shock took its slowing growth toll, Greenspan eventually cut rates.  Greenspan later told Congress that the Persian Gulf crisis had become a...

Which political party is now the party of America’s working class?  The latest income and poverty data from the U.S. Census Bureau suggest a clear answer: the Republican Party as led by Donald Trump under the MAGA banner.  Forget the rhetoric for a moment. Follow the money.  Real median household income jumped 2.6 percent in 2025 to $87,460 — the highest level since the Census Bureau began keeping the series in 1967. After taxes, the story was even better: real median household income rose 3.1 percent, from $73,760 to $76,060.  That is what a working-class...

The Securities and Exchange Commission under Chairman Paul Atkins is right to insist that corporate annual meetings return to their proper purpose: the business of business. Shareholder proposals should not serve as a permanent political soapbox. In a healthy system, management’s duty is to create long-term value for the owners of the company, not to advance the latest ideological fashion. A neutral process that keeps politics out of the proxy is, in principle, a worthy goal.But principles do not erase history. And history shows that the left has already politicized America’s...

This June, the European Commission (EUC) made a preliminary designation of two American cloud computing companies, Amazon Web Services (AWS) and Microsoft Azure, as gatekeepers under the EU’s Digital Market Act (DMA). The DMA forces large technology companies (gatekeepers) to share their intellectual property and even provide access to their operating systems to their smaller competitors. The EUC concedes that AWS and Azure do not meet the DMA’s quantitative thresholds for gatekeeper designation, so the EUC is relying on Article 3(8). Article 3(8) allows the EUC to designate a...

This week, Jack Dorsey’s Block applied to federal regulators to create a national trust bank that would provide custody and fiduciary services for Bitcoin. It is the latest sign that Bitcoin is moving rapidly into the mainstream American banking system. There is just one problem: the international rules governing bank capital still treat Bitcoin as financial kryptonite. Under those rules, a bank must hold ten times as much capital against Bitcoin as against the subprime mortgages that blew up the global economy in 2008. The formula treats Bitcoin, a transparent, verifiable and scarce...

If the Fed caused the inflation, then why is the Fed empowered to fix inflation? It’s a question not asked enough, but with the Fed a combination of mysticism, myth, and gullibility inform an endlessly ridiculous discussion of the central bank. The mysticism includes books like G. Edward Griffin’s The Creature from Jekyll Island that claim the Fed was a creation of the Rockefeller’s, the Council on Foreign Relations, and other high-end notions meant to impoverish the rest of us. Forgetting that the Rockefellers were already starting to disappear when Griffin’s book was...