#269 Luke Gromen: The Fiscal Situation Is Completely Cooked - Powell Faces Impossible Choice, Get Out Of Government Bonds Into Hard Assets The Julia La Roche Show podcast

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#269 Luke Gromen: The Fiscal Situation Is Completely Cooked - Powell Faces Impossible Choice, Get Out of Government Bonds Into Hard Assets

20h ago 53:46

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Luke Gromen, founder of FFTT, joins the Julia La Roche Show for episode 269 for his latest macro update. Gromen argues the US government is in fiscal dominance, spending over 100% of tax receipts on entitlements and interest payments alone. He says Fed Chair Powell faces a binary choice between crushing the dollar through inflation or crushing the bond market through higher rates. Gromen notes that funding currency relationships between the yen and dollar have broken down, signaling both central banks are cornered. He advocates getting out of government bonds and into hard assets like gold and Bitcoin, predicting that retail investors holding long-term Treasuries will be the biggest losers. Gromen believes Trump officials are "begging" for rate cuts because they know the fiscal math doesn't work without negative real interest rates.

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website: https://fftt-llc.com/

Twitter/X: https://twitter.com/lukegromen

00:00 Introduction and welcome back Luke Gromen

01:01 Funding currency relationships breaking down

07:58 Meta trade: exit government bonds, buy hard assets

12:27 Gold still early - central banks driving demand

14:47 Trump officials begging for rate cuts - Fed cornered

16:56 Stablecoin plan requires much higher Bitcoin

20:33 Dollar/bond correlations broken - foreigners selling Treasuries

27:11 Powell's binary choice: crush dollar or bonds

34:14 Fiscal dominance: interest expense >95% of receipts

37:08 DOGE failed - needed dollar devaluation first

39:25 Portfolio: overweight gold, Bitcoin

45:18 Two scenarios: Powell cuts vs. doesn't cut rates

48:54 Retail investors stuck holding long-term bonds

52:04 Closing remarks

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