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Gold
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Real-time News
On August 2nd, Federal Reserve Board Governor Kugler abruptly announced his resignation on Friday, giving US President Trump an opportunity to fill the Fed vacancy earlier than expected and potentially forcing him to finalize his next chairmanship months in advance. Derek Tang, an economist at the monetary policy analysis firm LH Meyer, said, "The ball is now in Trumps court. He has been pressuring the Fed to install his own candidate. Now his opportunity has arrived." While Powells term as chairman ends in May of next year, his term as a governor runs until 2028. If Powell doesnt voluntarily resign as a governor, Trump wont have another chance to fill the vacancy before 2028. In this scenario, Trump might be forced to fill Kuglers vacancy with a candidate he plans to promote as chairman. Tobin Marcus, head of US policy and political strategy at Wolfe Research, noted, "The key is that this is the only vacancy Trump can fill. If he wants to find the next Fed chair from outside, the nomination could be announced earlier."On August 2nd, Canadas retaliatory tariff increase against the United States earlier this year is leading the Trump administration to adopt a differentiated trade strategy with Mexico. Previously, Canada and Mexico enjoyed equal treatment—both were subject to a 25% base tariff and enjoyed extensive duty-free access under the USMCA. However, this situation took a sudden turn on Thursday: Trump announced a 90-day suspension of tariffs on Mexican goods, while simultaneously raising tariffs on Canadian products to 35%. Existing retaliatory measures have not only failed to curb the escalation of the conflict but have instead prompted even more severe retaliation from the United States. Economist and former Bank of Canada Governor Mark Carney has stated that retaliatory measures are limited in effectiveness. In fact, the Canadian government has diluted retaliatory tariffs through numerous exemptions, refrained from retaliating when the US raised steel and aluminum tariffs to 50%, and even eliminated its digital services tax at the request of the US.On August 2, the Palestinian Islamic Resistance Movement (Hamas) issued a statement today (August 2) emphasizing that "unless our national rights are fully restored, the most important of which is the establishment of an independent Palestinian state with Jerusalem as its capital and full sovereignty, we cannot give up armed resistance."On August 2nd, Berkshire Hathaway took a $3.8 billion write-down on its Kraft Heinz investment, signaling that Buffetts iconic 2015 consumer goods deal is facing significant challenges. This marks Berkshires second impairment of the business, following a $3 billion write-down in 2019. As of the end of June, Berkshire lowered the investments carrying value to $8.4 billion. The investment was a rare disappointment for Buffett. While the investment remains profitable, the packaged food giants stock price has fallen 62% since the 2015 merger of Kraft and Heinz. Over the same period, the S&P 500 has risen 202%. Kraft Heinz is currently considering spinning off some of its businesses to address challenges such as inflation suppressing consumer demand and the impact of the healthy eating trend.On August 2nd, Warren Buffetts Berkshire Hathaway (BRK.AN, BRK.BN) announced that its consumer products business has been impacted by US President Trumps trade policies, which have increased tariffs on imported goods. The conglomerates consumer products division (which includes brands such as Fruit of the Loom, Jazwares, and Brooks Sports) reported a 5.1% year-over-year revenue decline to $189 million in the second quarter, primarily due to declining sales, tariff impacts, and business restructuring. Berkshire cited tariffs as delays in order deliveries. However, the company noted that Brooks, the athletic shoe brand, bucked the trend with an 18.4% revenue increase in the quarter, driven by increased sales. Because Berkshires businesses span multiple economic sectors, its performance is seen as a microcosm of the US economy, attracting considerable investor attention. At Berkshires annual meeting in May, Buffett strongly supported free trade, stating that tariffs should not be used as a "weapon" and emphasizing that "balanced trade is good for the world."
