The Epstein circus aside, Trump is still wrestling with basic arithmetic: tariffs raise consumer prices. His campaign insists affordability is improving, even as grocery bills creep up another 2.7%.
Bear with us a minute today. We’ve decided we’re going to be annoyed with mainstream pundits talking about “affordability.”
If you’ve been listening to the professional explainers of the inexplicable, you might believe voters suddenly became obsessed with “affordability” on a whim. As if the American electorate were a flock of ornamental pigeons changing direction because someone rattled a bag of seed.
Since the pandemic era, the free stimmies being handed out because the knuckleheads shut down the economy, and the “sticky” Biden admin penchant for government spending… and the aggregate increase of government spending by 50%… resulted in increased prices, at least, a classical economist would argue.
More money sloshing around in the system means daily life has gotten more expensive. Not rocket science.
We’ve all observed certain goods — TVs, laptops, the gadgets we don’t need but buy anyway — keep getting cheaper, often while getting better.
But the Big Four killers of household budgets: healthcare, housing, childcare, and education, are marching upward like a military parade.
Add Biden-era price-level stickiness and Trump-era tariffs whose full effects haven’t even landed yet, and you get the stew voters have been choking down.
Democrats finally discovered a narrative outside gender and race identity politics that voters actually care about. “Affordability” led to victories this month in New York, New Jersey, and Virginia.
Does it matter that their solution for government spending and higher taxes is even more government spending and even higher taxes?
Apparently, no. Not to financially stressed voters.
Trump, rereading the same tea leaves, has begun floating targeted tariff cuts on Latin American imports to lower grocery bills. He’s also seems to be borrowing a page from the Biden/Harris playbook and trying to convince reporters that there is no affordability issue.
On more than one occasion, the president has cited Walmart’s announcement that this year’s Thanksgiving meal is 25% percent cheaper than last year’s. That’s his way of proving tariffs aren’t hurting consumers.
Reporters have too gobstopped to ask a simple follow-up question, like “oh, really?”
The Walmart Thanksgiving meal is cheaper this year because Walmart quietly swapped out several items — those that had become too tariff-bloated to include.
The economists at the Bureau of Labor Statistics (BLS) would call this “market substitution.” Mencken would call it “bunk.”
The New York Times is having some fun with another new angle in which they can position the president more than an aristocrat… a king.
The Swiss, according to the NYT story, arrived in Washington with gifts fit for a pharaoh: a personalized 1-kilogram gold bar, a Rolex desk clock, and more flattery than a Davos cocktail hour.
Their Helvetic ruse worked.
Tariffs on Swiss goods dropped from 39% to 15%, in exchange for friendlier trade access and new Swiss investment on US soil.
When it comes to their own money, voters aren’t crazy. They’re not necessarily stupid, either. Affordability is not a new challenge they suddenly started caring about on November 4th, 2025 the day after Momdani became the mayor-elect of New York City.
Bitcoin’s Bad Weekend
Bitcoin’s bear market is starting to look like a proper sulk.
Down 25% from its October peak, the token has erased all its 2025 gains.
More importantly, Bitcoin has been trading like the Nasdaq’s caffeinated younger cousin — correlation near 0.80, the highest since the 2022 selloff.
The high correlation between Nasdaq and Bitcoin suggests the Nasdaq is also due for a correction. (Source: Top Down Charts)
If the pattern holds, tech stocks may be next in line for a 10% correction. Bitcoin rarely swims alone.
Indeed.
Yet — because markets enjoy irony — this is also when institutions quietly accumulate.
Harvard just boosted its position in the iShares Bitcoin Trust (IBIT) by 257%, now holding $442.8 million, making Bitcoin its single largest ETF allocation.
This is from the same university whose own Kenneth Rogoff once predicted bitcoin was more likely to hit $100 than $100,000.
Academia may take decades to change its mind, but endowments move at the speed of money.
We cover this shift — and how Trump’s own debanking ordeal pushed him (and the political class) toward digital assets — in the Grey Swan Bulletin this month, under the title “The Second American Revolution Will Be Digitized.”
Russell Kirk reminded us that the American Revolution was a preserving revolution — fought to keep inherited rights, not overturn them. Trump’s journey from banking pariah to champion of digital alternatives is, somehow, perfectly American.
And now we’re watching the dollar undergo its own upgrade and rebrand.
The Dollar’s Digital Empire, Rising
Picture Rome, 1971.
Finance ministers chain-smoking in a conference room, furious that Nixon closed the gold window.
Treasury Secretary John Connally leans back in his chair and reminds the world:
“The dollar is our currency, but it is your problem.”
Half a century later, it’s still their problem.
And in 2025, the problem is evolving. But it’s getting a digital makeover.
Stablecoins — digital dollars backed by cash and T-bills — have blown past $600 billion in circulation. And 99% of all stablecoins are USD-denominated. They settle instantly. Cost fractions of a penny. And can move across borders without needing a SWIFT clerk to wake up from a long lunch.
Like it or not, this is the next extension of American monetary influence. The Eurodollar market of the 1950s, but digitized.
The crisis-era gold rally may give the impression that the dollar is weakening. In truth, the dollar is colonizing the digital frontier faster than any competitor can blink.
We still like gold, mind you. But Dollar 2.0 is likely going to give the currency’s reserve status a life-extending upgrade.
Markets: Walking Into a Choppy Week
U.S. futures opened higher, though investors are tiptoeing around several landmines:
- Nvidia reports next week, and options markets are bracing for big volatility – a 7% move up or down after Wednesday afternoon’s report.
- Traders now assign less than 50% odds to a December Fed rate cut.
- The FAA finally lifted flight caps, bringing air travel back toward sanity.
- Walmart, Target, and Home Depot earnings this week will tell us whether the consumer is merely winded or lying flat on the track.
Meanwhile, half of individual investors in the AAII survey say they’re bearish for the next six months.
This isn’t the kind of sentiment one sees at euphoric tops. It resembles the late-1990s moment when people kept buying bottled water and ammo “just in case” — and then the Nasdaq doubled anyway.
Skeptics often fund the final leg up.
Liquidity Jitters and Repo Rumblings
The New York Fed quietly summoned Wall Street’s primary dealers last week. Not for pastries — though those were probably present — but to discuss the Standing Repo Facility.
A few weeks back, money-market rates drifted upward, the federal funds rate crept above target, and the SRF saw its first meaningful use since its creation in 2021.
Repo markets are the circulatory system of finance. When they twitch, the whole body pays attention. The Fed wants banks to use the SRF without stigma… banks prefer not to look desperate.
Meanwhile, a broader question looms: if liquidity is tightening now, before the next downturn, what will the strain look like when real stress arrives?
Bezos’ Project Prometheus
Jeff Bezos isn’t going to let Musk, Altman, Zuckerberg and Luckey have all the fun. He’s back in the CEO chair at Amazon, co-running Project Prometheus, a $6.2 billion AI venture aimed at next-gen manufacturing and aerospace engineering.
As we would be wise to observe, when the world grows unstable, the big players consolidate power and build competitive moats. Bezos stepping back in is a signal, a strategy.
We’ll be sleuthing around for pick and shovel supporters of Project Prometheus and let you know what we come up with.
The K-Shape Defined
Back in the real world, the labor market’s K-shape extended last week.
The K Shape: White-collar hiring is slowing. Wage growth is softening. And competition is rising for jobs people usually avoid—substitute teachers, traffic flaggers, sanitation roles.
Meanwhile, nearly half of employed Americans say it would take four months or more to find a similar-quality job if they lost theirs today.
Low-hire, low-fire economies feel stable. But with inflation and anxiety increasing, are they, really?
China’s Nuclear Ambition Rekindled
Over the weekend, satellite analysis shows China is rapidly expanding its nuclear testing site in Xinjiang — new tunnels, explosive chambers, and support infrastructure.
On the heels of the Trump announcement to do the same, and after decades of relative quiet, Beijing appears to be preparing for a new era of weapons testing.
If the 21st century had a plot twist left, this would be in the running.
We’ll spend this week watching bitcoin’s mood swings, repo signals, retail earnings, and the next chapter of the affordability saga.
Beneath it all lies a more permanent truth:
Every financial era ends with the same two groups — those who saw the shift, and those who were too busy arguing over who caused it.
Like you, we’re planning to choose wisely which group we’re in.
~ Addison
P.S.: Among the ideas Andrew Zatlin floated last Thursday on Grey Swan Live! Is that the Trump administration has a calendar of stimulus programs, like tariff rebates, designed to be released and make you feel good about the economy and the jobs picture all through and up to the midterm elections in 2026.
Zat then rattled off a list of items he forecasts will be included on a month-by-month basis. Simply, getting behind the scenes and following along with those forecasts is worth a short listen to the replay, which you can do right here:
If you have any questions for us about the market, send them our way now to: feedback@greyswanfraternity.
