Power Plays, and the Great Mortgage Mood Swing

In a display of political theatre that would make Shakespeare rise from the grave for a front-row seat, President Trump took to the Federal Reserve with the subtlety of a wrecking ball on espresso. First, he turned up the heat on Fed Chair Jerome Powell, strongly encouraging (read: thunderously demanding) a generous interest rate cut. Then, like a magician pulling governors out of hats, he attempted to give Governor Lisa Cook the boot while sliding Stephen Miran into what appeared to be a now-vacant seat — except it wasn’t.

You see, Lisa Cook, apparently not one to be evicted without a legal battle and a flair for courtroom drama, sprinted to the Supreme Court and got herself a temporary stay. She’ll continue sitting on the Fed’s board while allegations of mortgage fraud swirl like gossip at a country club. These accusations, if true, would have given Trump the green light to send her packing. But for now, she’s still in the chair — with a very tense cushion.

As for Mr. Miran, he’s technically filling the tail end of former Governor Adriana Kugler’s term — she’s off to the calm pastures of academia where no one asks you to explain basis points on national television.

Meanwhile, despite all the shouting from the peanut gallery (read: the Oval Office), the Fed — ever the cautious, spreadsheet-loving institution — offered a mere 0.25% interest rate cut. President Trump, of course, wanted a larger slash. He probably would’ve preferred negative rates and a complimentary foot massage, but alas, inflation still exists.

Now to the mortgage market, which, like a moody teenager, refuses to behave as expected. The 30-year fixed mortgage rate — a darling of dinner table discussions everywhere — had already dropped to nearly 6% before the Fed even opened its mouth. Then, after the announcement? It climbed to 6.5%, which, to put it lightly, was not the market’s idea of a good time.

Why the mismatch? Well, contrary to popular myth, mortgage rates don’t obediently follow the Fed’s lead like ducklings behind Mama Powell. Instead, they take cues from mortgage-backed securities (MBS), particularly the spread between MBS yields and the 10-year Treasury, which is considered a “risk-free” benchmark — unless you’re counting emotional risk, in which case, all bets are off.

Investors demand a premium on MBS to compensate for the terrifying prospect that people might refinance, move, or stop paying altogether — shocking, I know. That premium fluctuates based on market volatility, credit risk, and whether investors had a good breakfast that morning.

As for home sales, the National Association of Realtors’ Pending Home Sales Index inched up in August — a hopeful little twitch that may signal the market’s sensitivity to interest rates. But let’s not pop the champagne just yet. With sales still dwelling in the proverbial basement, this uptick could very well be a “dead cat bounce” — a lovely financial term meaning: it jumped, but only because it hit the floor hard enough.

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The Housing Market: Still Bonkers, Just in a Different Way

Once upon a pandemic, Americans lost their minds—and their square footage. In 2021, over 6.5 million existing homes were flying off the shelves like toilet paper in March 2020. Home prices soared. Inventory plummeted. By February 2022, the number of homes for sale nationwide had collapsed to a pitiful 346,514—roughly the number of snacks in your pantry during lockdown.

Fast-forward to August 2025, and inventory has done a spectacular Houdini reversal, rising to just over 1 million listings (1,098,068, to be precise—because economists enjoy false precision). Existing home sales in that same month came in at a modest 4 million annually. That’s a big shift from the pandemic boom and eerily like the 2008–2012 period, a time when housing prices dropped over 30%, and everyone suddenly remembered what “foreclosure” meant.

And yet—cue the dramatic organ music—home prices keep inching higher. Yes, still. Slowly, grudgingly, like your uncle admitting he might’ve been wrong about Bitcoin.

But don’t rush to the bomb shelter just yet. While comparisons to 2008 are inevitable, they’re also lazy. Back then, the whole party was brought down by a Jenga tower of toxic mortgage-backed securities. In 2025? No obvious financial apocalypse looms. In fact, the broader economy is… annoyingly stable. Unemployment is low, GDP is fine, and no one’s baking mortgages into derivatives like it’s 2006.

So, what’s clogging the market this time? Let’s call it a cocktail of complications:

• Sky-high home prices
• Mortgage rates that could qualify as medieval torture devices
• A nation of homeowners locked into impossibly low rates and refusing to move
• Stagnant wages
• And a dash of good old-fashioned credit card debt

The result? Transactions are down. Way down. But don’t confuse stagnation with death. Homes are still selling, just more like a British queue than a Black Friday stampede.

Take “Days on Market”—a sort of real estate speedometer. Nationally, homes are sitting around for 60 days before finding a buyer. That’s longer than in the frothy COVID days, but still faster than the 80-day average pre-pandemic. Buyers, it seems, still want to buy. They’re just pickier now—and understandably so, given the monthly mortgage payment now rivals the GDP of a small island nation.

As for interest rates, don’t bet the house on them coming down dramatically anytime soon. The Fed, like a stern Victorian nanny, is still frowning at inflation. Which means it may be time for sellers to blink first. Lower prices or keep staring at that “For Sale” sign for the next few months (or years).

Of course, these are national figures. Real estate, like barbecue sauce preferences, is regional. What holds true in Boise may be nonsense in Brooklyn. Every state, city, and zip code has its own quirks.

So: the market’s not crashing. It’s just… clogged. And until we find the economic equivalent of Drano, don’t expect a dramatic plot twist.

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The Economic Stormfront: Eight Months of Hurricane Donald

Back in mid-2024, national polls showed that a clear majority of Americans believed the country was headed in the wrong direction. Nothing new there. Over the past few decades, presidents from both parties—Clinton, Bush, Obama, and Biden—have acknowledged key issues like illegal immigration and unbalanced international trade. They even agreed on many of the potential fixes. But once in office, that consensus seemed to evaporate into hand-wringing and gridlock.

Then came November 2024.

Donald J. Trump was elected—again—this time as the 47th President of the United States. By January 2025, the doors of the White House swung open, and with them came Hurricane Donald. Washington hasn’t been the same since.

In just eight months—light speed by D.C. standards—the Trump administration has unleashed a whirlwind of policy decisions that have reshaped America’s domestic and foreign landscape:

• Illegal immigration? Shut down hard. Over 2 million undocumented immigrants have left including more than100,000 undocumented immigrants deported.
• Global trade? Reciprocal tariffs now blanket nearly every U.S. trading partner.
• 1Foreign Aid? Cancelled programs where 10% of aid reached the intended recipients.
• Bureaucracy? Dismantled. More than 100,000 federal employees let go.
• Crime? The military has been deployed in cities long plagued by crime and violence.
• Foreign policy? The U.S. is now actively involved in conflicts from Ukraine to Gaza, from Armenia to Kashmir, and even tensions in Southeast Asia.
• NATO? Pressured into ramping up defense budgets—beyond their own commitments.
• Drug smuggling? U.S. military interdiction now spans Mexico to Venezuela.
• Pharmaceuticals? Americans are finally seeing lower drug prices, after decades of subsidizing cheaper meds abroad.
• Foreign investment? Trillions are flowing into U.S.-based manufacturing.

It’s been loud, messy, and divisive—but undeniably fast.

Naturally, this approach has set off alarms around the world. Trump’s brash, erratic style hasn’t exactly built bridges. But even his critics admit: Washington has never moved like this.

An honest economist—who, let’s face it, does their best work in hindsight—might have predicted disaster. Mass deportations? Labor shortages. Tariffs? Rising prices and inflation. Bureaucracy cuts? Job losses, fewer contracts, and maybe a recession. Alienating allies? Damaged exports and shrinking global markets. The stock market should’ve tanked by now, right?

And yet, here we are.

Despite those gloomy projections, a different story may be unfolding beneath the surface. Onshoring of production could revitalize American industry. A leaner federal government might reduce waste. A more self-reliant Europe, coupled with a more assertive U.S. trade policy, could rebalance the economic playing field.

Whether you see it as reckless or revolutionary, one thing is clear: we’ve only made it through 8 months. There are 40 more to go.

Buckle up.

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Europe’s Shadow War Is No Longer in the Shadows

When The Telegraph likened Europe’s current peril to “its Pearl Harbor moment,” it wasn’t hyperbole. The warning came alongside an urgent call from former Lithuanian Foreign Minister Gabrielius Landsbergis, who declared that Vladimir Putin’s hybrid war is dragging the West toward a direct confrontation. That alarm is not without cause. Russian MiG-31 fighter jets have breached Estonian airspace. Swarms of unidentified drones have disrupted Polish airports and surveyed sensitive infrastructure. A shadow war is unfolding across Europe, and the shadows are getting darker.

The frontlines of this conflict are no longer limited to the battlefields of Ukraine. The Kremlin’s campaign now extends into the airspace and cyber systems of NATO countries. Each drone strike, each violation of sovereign skies, is part of a broader strategy: test the West’s tolerance, exploit its divisions, and probe its readiness.

These provocations are not new, but they are escalating. And they demand a sober understanding of both history and intent.

Russia’s military record offers a mixed—and often sobering—lesson in overreach. The war in Ukraine, now entering its third year, was supposed to be a swift “special military operation.” It has become a grinding conflict, with estimates suggesting over a million Russian casualties. The Kremlin has found itself locked in a war of attrition it cannot easily escape.

This is not the first time Moscow has underestimated its opponents or overestimated its own reach. Russia’s disastrous war in Afghanistan (1979–1989), its bloody but inconclusive interventions in Hungary (1956) and Czechoslovakia (1968), its humiliation in the Russo-Japanese War (1905), and its costly struggle against Finland in 1940 all point to a historical pattern: initial aggression, followed by strategic miscalculation.

Even so, to dismiss current tensions as exaggerated would be a mistake. While Russia may stumble in long-term occupations, it excels in disruption, disinformation, and destabilization—especially when it can avoid the cost of open war. And that is precisely what makes this moment dangerous.

If history teaches anything, it’s that wars are rarely predictable. Europe twice stumbled into world wars not from grand designs, but from missteps, misreads, and the failure to contain early provocations. Today’s drone flights and airspace violations may seem minor—until they aren’t.

Europe is not sleepwalking into war. But it is being tested. Whether it answers with unity and resolve—or confusion and delay—may define this era.

Royal Menus & Rebel Malts

The BBC reported that the pageantry of the recent state dinner hosted by His Majesty for the President of the United States was, as the British say, not short of a spectacle. Think 160 guests, 1,452 pieces of cutlery, and a menu written in French—because nothing says diplomacy like translation.

For President Trump’s visit, the kitchen rolled out the edible red carpet with:

• Hampshire watercress panna cotta with Parmesan shortbread and quail egg salad
• Organic Norfolk chicken ballotine, wrapped in courgettes and draped in a thyme-and-savory jus
• Vanilla ice cream bombe with Kentish raspberry sorbet centre and lightly poached Victoria plums (God save the bombe)

And the wine list? Positively baronial:

• Wiston Estate, Cuvée, 2016
• Domaine Bonneau de Martray, Corton-Charlemagne, Grand Cru, 2018
• Ridge Vineyards, Monte Bello, 2000
• Pol Roger, Extra Cuvée de Réserve, 1998

For the final flourish, drinks soaked in symbolism: a 1945 vintage port to nod at the 45th president (who doesn’t drink), and a 1912 cognac in honor of Trump’s Scottish-born mother’s birth year. Subtle as a bagpipe solo.

On a slightly less extravagant but infinitely more joyful occasion, I hosted a five-course whisky-paired dinner to celebrate a dear friend’s recovery from breast cancer. No palace, no footmen, no golden cutlery—just good people, good food, and five excellent excuses to pour Scotch.

First Course

Smoked duck breast with roasted pears
Paired with: Auchentoshan 12-Year-Old
One of Scotland’s few triple-distilled malts (think Irish finesse meets Glaswegian stubbornness). Born tough—bombed in the Clydebank Blitz, but still standing.

Tasting Notes:

• Nose: lemon zest, toffee, toasted almond
• Palate: vanilla fudge, mandarin, barley sugar
• Finish: dry, gingery, tidy like a Glasgow haircut

Second Course

Sautéed rack of venison with caprese salad & peach chutney
Paired with: Glenfiddich 12-Year-Old
Founded by William Grant and his seven children—yes, an actual family startup before it was cool. The whisky equivalent of a first kiss: fruity, honest, unforgettable.

Tasting Notes:

• Nose: green pear, apple, honey
• Palate: orchard fruit, vanilla crème, light toffee
• Finish: clean, malty, and just a whisper of pear skin

Third Course

Grilled ostrich steak with steamed asparagus & béarnaise sauce
Paired with: Balvenie 14-Year-Old Caribbean Cask
Craft nerds rejoice: floor maltings, in-house coppersmiths, and the wizardry of David C. Stewart MBE. Finished in rum casks, because why not?

Tasting Notes:

• Nose: toffee, ripe banana, vanilla pods
• Palate: honeyed malt, tropical fruit, brown sugar
• Finish: long, warm, with a cheeky rum-toffee whisper

Fourth Course

Braised beef short ribs on yellow sweet potato purée
Paired with: Oban 14-Year-Old
Small distillery, big character. Half Highlander, half seafarer—if whisky had a salt-and-pepper beard, this would be it.

Tasting Notes:

• Nose: orange peel, sea breeze, heather honey
• Palate: dried apricot, gentle smoke, brine
• Finish: citrus oil, peppered oak, clean saline snap

Fifth Course

Melktert (South African custard pie) with marinated berries & cream
Paired with: Laphroaig 10-Year-Old 
This one’s not for fence-sitters. It’s loud, proud, and peaty as hell. Either you’re all in, or you’re coughing politely into your napkin. Royal Warrant approved, for what it’s worth.

Tasting Notes:

• Nose: campfire-on-the-shore, iodine, lemon peel
• Palate: sweet peat, ashy smoke, honeyed oak
• Finish: long, maritime, and medicinal enough to be sold in apothecaries

A grand evening, with five whiskies and even more opinions. Conversation got looser, laughter got louder, and in a moment of exuberance, one of our musical guests pledged to pair music with the next dinner’s food and drink.

Because of course—if you can match duck with Auchentoshan, why not Miles Davis with melktert?

Stay tuned. Next time: notes on the playlist.

Ps. Reminded me of the dinners at the Alpenhorn

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