Peter St Onge Podcast Ep 125 Weekly Roundup: Trump "Demands" Fed Rate Cuts
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Jun 16, 2025 This week, the discussion dives into Trump’s push for a 1% Fed rate cut, stirring debates on economic policy. Argentina's impressive 8% growth showcases how reforms can foster revival. California faces funding threats amidst social unrest, highlighting tension between state and federal governments. Meanwhile, Canada grapples with recession and rising costs for the middle class under current policies. Plus, there's a thought-provoking challenge to the narrative around immigration’s impact on labor shortages, advocating for better job creation and education for Americans.
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Fed's Unusual High Rates Impact
- The Fed keeps rates high despite inflation below target and a slowing job market, contrary to normal behavior.
- This unusual stance risks strangling the economy and political fallout at midterms.
Argentina’s Radical Spending Cuts
- Argentina cut government spending by one-third, firing 48,000 workers equivalent to huge U.S. federal layoffs.
- This led to 8% growth, lower inflation, and poverty reduction within 18 months under Javier Malay.
California vs Federal Funding Reality
- California pays more federal taxes than it receives, creating a net subsidy to other states.
- Trump can legally cut federal funding to California, but Newsom cannot withhold federal taxes from the IRS.