Here’s An Obvious Example Of A Critical Resource Shortage

Here’s An Obvious Example Of A Critical Resource Shortage

Notes From the Field By James Hickman (Simon Black / Sovereign Man) September 10, 2026

In July, the Canadian uranium miner Cameco stopped producing at its mine in northern Saskatchewan (known as ‘Cigar Lake’) for two weeks. Cigar Lake itself was fine, nothing was wrong with the mine. The problem was their sulfuric acid plant— a crucial ingredient in processing uranium ore— broke down.

Normally they would have just bought sulfuric acid from somewhere else while they fixed their company-owned acid plant. But this year that's not so easy.

About half the world's seaborne sulfur moves through the Strait of Hormuz, and since the war with Iran began, those shipments have almost completely stopped. China, the world's largest exporter of sulfuric acid, restricted its own exports in May to make sure they had enough.

So a simple mechanical problem at an acid plant caused a two-week shutdown of the world’s largest uranium mine.

Two weeks is a really long time for a huge mine like Cigar Lake to have an unscheduled shutdown; that’s because uranium is already in critical supply— there simply isn’t enough uranium being produced right now to keep up with demand.

The math is easy: miners produced roughly 155 million pounds of uranium in a year. Reactors burn about 185 million pounds. So there’s already a significant deficit.

For the past several years, the deficit between uranium production versus reactor demand was covered by stockpiles that had been building up over decades. So the nuclear industry effectively burned through its uranium ‘savings’.

But those stockpiles of uranium are now basically depleted... which means that nuclear power companies will need to rely on uranium production in order to meet their needs.

This is a problem... and one that we can quantify.

Because uranium is literally THE most important resource for a nuclear reactor, the reactor companies tend to line up their uranium supply needs years and years in advance through forward contracts and term agreements.

There’s no black magic here— it’s a pretty predictable quantity. A 2GW nuclear plant, for example, already knows exactly how much electrical capacity they have, so they know how much fuel they need to serve their customers... hence they can forecast their future uranium needs.

For this year at least, US nuclear power companies have more or less the amount of uranium that they anticipate needing. But next year they’ll be in a deficit... and one that grows each year.

By 2030, US nuclear power companies will be short 40% of their anticipated uranium needs. By 2033, they’ll be short 91%. Basically all of it.

Big deal, right? Existing uranium producers can simply mine more.

But that’s not really happening... at least, not at current prices.

Kazatomprom (based in Kazakhstan) is the largest uranium miner in the world. And their management is deliberately pulling back on production right now.

The company believes that it's simply not worth mining and selling uranium at the current price. Why bother producing at your full potential now when they KNOW the price is going to rise in the future, hence they make a LOT more money in the future if they mine less now.

OK well, the big shortage in the 2030s is still a few years away. So the industry has time to start more mines and bring new uranium production online.

Well, that’s easier said than done.

A company called NexGen Energy discovered a major uranium deposit in Saskatchewan back in 2014. They finally got their construction license this March, started building in August, and expect their first ore in 2030.

In other words, SIXTEEN years from discovery to production— and that's about average for the industry.

You can’t just turn on uranium production like a light switch; it takes years and years to make most things happen in business, and uranium mining is no different.

This is common across many real assets— there has been years of underinvestment. Very few new uranium mines. Very little oil & gas exploration. Not enough new shipyards, refineries, smelters, etc.

It takes several years... plus a lot of risk capital... to discover a new resource deposit and bring a mine to life. Years.

Demand can grow much more quickly. Just look at the increase in electricity demand (thanks in large part to data centers). When electricity demand surges, but the supply of the fuel required to generate electricity is stagnant, the end result is higher prices.

And not just higher electricity prices— higher prices for the fuel as well, i.e. higher natural gas prices, higher uranium prices, and even higher coal prices.

(Coal is especially interesting— it was basically chased out of town. NO ONE wanted to invest in a new coal mine thanks to Greta Thunberg. Yet the International Energy Agency now expects coal-fired power generation to rise this year to make up for energy imbalances. Stagnant supply meets rising demand.)

That's tough news for anyone with an electricity bill. But you can also be on the other side of it and make money from this trend.

When supply and demand is so fundamentally unbalanced, the companies that produce these scarce resources tend to perform extremely well.

This is the primary investment ethos for our investment research newsletter, Strategic Assets.

We look for the most critical resources that the economy runs on; we find sectors where there has been chronic under -investment and focus on undervalued yet successful companies with great management and balance sheets.

Energy has been good to us. Two oil tanker owners we featured when nobody wanted them are up more than 150% and 110%.

A small South American oil producer we featured last month has no debt and sells every barrel at the wellhead to one of the largest oil companies on earth— so shipping is someone else's problem. A typical new well takes years to pay for itself. This company's fastest did it in 37 days.

To your freedom,  James Hickman    Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/investing/heres-an-obvious-example-of-a-critical-resource-shortage-155827/?inf_contact_key=d95979746ed8559f5d70416a14a4de6e75ed3b9f1880b1bad6530b4fabbb2716

The Candlestick Makers Are Back, and This Time They're Not Joking

The Candlestick Makers Are Back, and This Time They're Not Joking

Notes From the Field By James Hickman (Simon Black / Sovereign man)  September 3, 2026

In 1845, the French economist Frédéric Bastiat petitioned parliament on behalf of the nation's candlestick makers. They were being ruined, he wrote, by an unscrupulous rival that was flooding the market with light at a price no honest candlestick maker could match.

This light-producing rival, of course, was the sun.

And Bastiat satirically demanded "a law requiring the closing of all windows, dormers, skylights, inside and outside shutters, curtains… in short, all openings, holes, chinks and fissures" to ensure that no sunlight could enter French homes.

Think of the jobs this would create. "If more tallow [curtains] be consumed, there will arise a necessity for an increase of cattle and sheep," the petition argued. "Thousands of vessels would soon be employed in the whale fisheries [for oil]."

Bastiat, one of history's most famous proponents of free markets, was obviously joking. He wrote the petition to mock the tariff wall that sheltered France's industries from cheap foreign goods— block the cheaper competitor, protect the domestic producer, count the jobs saved.

No one counted the cost of protectionism: everyone else paying more for everything, and the whole country became poorer.

Yet decade after decade since, every new innovation has been met with exactly this kind of uproar. And nobody is joking.

It wasn't so long ago that taxi drivers were up in arms over Uber undercutting their prices. In June 2015, nearly 3,000 of them shut down parts of Paris, burning tires and blocking airport roads, because Uber's cheap service didn't require the professional taxi license that could cost $270,000.

The French government caved within a day, ordering police to seize the unlicensed Uber drivers' cars.

Now the wheel has turned. Waymo's robotaxis launched in Atlanta in June 2025, bookable through the Uber app of all places. And Uber drivers say the competition is cutting their pay.

Naturally the Atlanta Rideshare Drivers Union wants the city to slap a $0.50 to $1.00 fee on every robotaxi ride, paid into a "driver transition fund," plus a ban on robo pickups at the Atlanta airport.

If only they could tax the sun for the candlestick makers.

The federal government runs the same play, just bigger.

In January 2025, the Commerce Department finalized its ‘Connected Vehicle Rule’, which bans cars with Chinese-linked software from the US market, starting with the 2027 model year.

The stated reason is national security: keeping foreign adversaries out of the cameras, microphones, and GPS units on American streets.

That's a real concern, to be fair. But then came the carve-outs.

Volvo, majority-owned by China's Geely, got authorization in May to keep selling. Ford, after talks with the department, decided its China-built Lincoln Nautilus doesn't need an exemption at all.

But Polestar— owned by the same Chinese parent as Volvo— was shut out and is leaving the US market.

The Commerce Department doesn't publish these decisions or its reasoning, so nobody outside the building knows why one Geely brand got a green light and the other got kicked out of America.

Let’s be honest: if these Chinese cars were really a security threat, there would be no carve-outs to negotiate. There would be a flat ban. No exceptions.

The real threat of cheap Chinese cars is to the profits of American automakers; Chinese cars are very inexpensive— like a decent quality mid-size SUV for around $20k. So many US buyers would start driving Chinese that the American automakers would either have to adapt and compete... or suffer catastrophic losses.

The end result of these bans is less competition, meaning Americans end up paying more for their vehicles.

Just add this to the long list of things which governments, from city councils to federal regulators, make more expensive.

Yesterday we wrote about how federal influence over local building codes adds $132,000 to the average new home.

Today it's how they're making buying a car and taking a quick trip more expensive.

Ask California how it's doing on that nonexistent high-speed rail… $15 billion and 18 years in, without a mile of track. Or ask Europeans, where climate fuel mandates are already tacking surcharges onto every plane ticket.

The receipts are everywhere: everything the government touches becomes more expensive.

College tuition is up about 1,200% since 1980— the surge began as soon as the federal government made itself the nation's student lender.

Since Obamacare passed, the average family health insurance premium has nearly doubled.

Even junk food became more expensive due to government  food subsidies; in fact the moment 18 states pulled soda and snacks off the food stamp list, PepsiCo cut prices on Doritos and Lay's by up to 15%.

Housing, transportation, food, healthcare, education— all swamped by government interference, all quickly became less affordable.

And underneath all of it, bringing the whole pot to a boil, is the inflation that politicians and regulators caused with their own spending.

Yet who do they blame? Greedy corporations.

Inflation has nothing to do with greed. It has everything to do with incompetence and irresponsibility.

Bastiat's joke was that nobody would ever actually file the candlestick makers' petition. Yet 181 years later, what started as satire is taking place every single day.

A political class that treats cheaper goods and services as a threat is deliberately choosing to make the country poorer.

To your freedom,   James Hickman    Co-Founder, Schiff Sovereign LLC

PS: A government that treats cheaper as a threat isn't going to start choosing growth anytime soon. That's exactly why we publish Plan B Confidential— our flagship research on legal, practical ways to diversify your savings, your income, and even your residency beyond any single government's bad decisions.

https://www.schiffsovereign.com/trends/the-candlestick-makers-are-back-and-this-time-theyre-not-joking-155789/?inf_contact_key=b0ef6370a6dded2c719cd076e817921372bed8fb19cd27e28b7566817f14a196

Government Regulations Now Add $132,000 to the Average New Home

Government Regulations Now Add $132,000 to the Average New Home

Notes From the Field By James Hockman (Simon Black / Sovereign Man)  September 2, 2026

Somewhere in America there's a local ordinance that tells you which way your garage has to face.  Another one dictates what your fence can be made of, and a third sets how many square feet of window your house needs. A few spell out the dimensions of particular features down to a quarter of an inch.

The National Association of Home Builders, the trade group for the companies that build American homes, has been adding up what rules like these cost since 2011.

Its reasoning is simple: the country is short about 1.2 million homes, and rising regulatory costs are one of the things keeping builders from closing that gap. So anyone writing new rules ought to know what the existing ones already cost.

Government regulation now adds about $132,000 to the price of a new home.

That's just over a quarter of the roughly $500,000 the average new house sold for in January.

Builders said that ten years of changes to the building code added about $40,000 to the cost of a house. That’s the cost to buy the extra materials and labor each new edition of the code demands… whether or not the buyer wanted them.

Some of those rules are reasonable— hurricane-rated windows on a house within a mile of the shore, or shock-proof breakers on the circuits that run the stove and the dryer.

But those same code changes also decided that a hot-water pipe can't run more than 100 feet, that the outlet on a kitchen island has to pop up out of the countertop, and that an ordinary draft-vented furnace needs its own sealed, insulated room with an outside air vent.

None of those is a matter of life or death; even the furnace is an energy-efficiency rule, and the homeowner doesn't get to decide whether the upfront cost is worth the long term savings.

Codes get adopted locally, but the model codes that cities and counties copy are drafted with help from the Energy Department, FEMA, and the EPA.

The study notes, almost in passing, that "DOE also has a budget to persuade state and local governments to adopt more stringent codes."

In other words, a federal agency spends tax money persuading your county to make your house more expensive.

Just the energy part of the code adds between $9,600 and $21,400 to a home built to the 2021 version, and NAHB estimates it can take the buyer up to 90 years to recoup that money in lower utility bills. So maybe your grandkids will thank you, assuming the house is still standing.

This cost was made a federal requirement— a condition of every FHA and USDA loan on a new house— until a judge ruled in March that it violated the government's own affordable-housing law. But it still stands as the building code in roughly a dozen states.

Then come the fees. Permits, inspections, impact charges, and utility hookups add about $20,000 per house after the builder buys the lot.

Like any medieval lord, the local government also takes its tribute in land. More than 85% of developers have to hand part of their parcel to the town for a park or keep it as open space, at a cost of about $13,600 per home. Of course that cost is passed on to the buyer.

Regulation also costs time, and the study only quantifies about half that cost. More than 90% of developers report delays averaging about seven months, and more than a year passes between the zoning application and the first day of work on the site.

The study puts the delay itself at about $4,000 a house. It doesn't count the opportunity cost, or how delaying new housing supply raises the costs of everything else on the market.

And it's quickly getting worse. Five years ago the same study put the total regulatory cost per home at about $94,000. It's up more than 40% since then— and it has doubled since 2011.

Disposable income in the US rose 18% over the same five years. So the cost of obeying the rules is growing twice as fast as anyone's ability to pay it.

Notice that these costs have nothing to do with greedy builders or Wall Street landlords.

Many builders have been cutting prices every month for well over a year, and new homes still aren't selling. They're sitting unsold— in a country that's short 1.2 million homes— because a builder can only cut so far before he's selling at a loss.

Ironically, on top of the federal government pushing a rule that violated its own affordable-housing law, NAHB suspects some of the rules have less to do with safety or efficiency and more to do with "aesthetics, or possibly even, in some cases, a desire to price less affluent residents out of particular neighborhoods."

Yet the same city councils that pass them will tell you affordable housing is their top priority.

And home building is just the one industry that bothered to add up the cost of insane government regulation.

The same thing happens anywhere the government writes the rule book.

Want to build a power line, a pipeline, or a mine? The White House's own environmental council found that the average federal environmental review takes four and a half years before anyone breaks ground.

The National Association of Manufacturers puts the cost of complying with federal rules at about $3 trillion a year, roughly 11% of GDP.

All of this strangling regulation is a big part of why the economy can't grow faster, and right now the US needs growth badly.

The national debt just crossed $40 trillion, and Congress refuses to cut a cent, even when the spending is obvious fraud.

That leaves two ways out. Either the economy grows faster than the debt, which means the country builds more, makes more, and starts more businesses than it does now… or the government prints the difference.

Without a regulation-destroying bonanza, it's obvious which one happens. If the government can't rein in the rules, it can't rein in the debt. And if it can't rein in the debt, it can't rein in inflation, because printing the money is the only option left.

To your freedom,  James Hickman     Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/trends/government-regulations-now-add-132000-to-the-average-new-home-155783/?inf_contact_key=bbb0815957021ddef146ec39214fc06ae6abc7ef250881a26a820a137a2e774a

Your Mortgage Is Now Competing With Google and the Pentagon

Your Mortgage Is Now Competing With Google and the Pentagon

Notes From the Field by James Hickman (Simon Black / Sovereign Man)  September 1, 2026

Hardly a week goes by without another data center announcement, and the projects have gotten so big that they're now measured in gigawatts.

A gigawatt is a billion watts of electricity. Running around the clock, one gigawatt is enough to supply about 800,000 average American homes— and a single large data center is now built at that scale.

The data center that Meta is building near El Paso is designed for a full gigawatt and comes online in 2028.

Plus Meta just announced plans to grow its campus in Louisiana to 5GW. And OpenAI's Stargate program, spread across sites in several states, is planned for 10GW.

These projects are also spectacularly expensive, and even the richest companies on earth have stopped paying for them out of pocket.

Earlier this month Google borrowed $25 billion from the bond market. It was the company's third major bond sale this year, which brings its 2026 borrowing to more than $70 billion.

Google needs the money because its capital expenditures budget this year is about $200 billion, and in Q2 they spent more cash than they brought in for the first time in more than two decades.

Meta is doing the same thing. In late July, a BlackRock-led group raised $12.5 billion of debt for that El Paso site, where Meta will be the sole tenant for twenty years.

The group had to pay about 7.5% to get the deal done, one of the highest yields on any blue-chip data center bond to date. That comes on top of the $25 billion in bonds that Meta sold in May, and another $30 billion borrowed for the Louisiana campus.

And that's just two borrowers. The total borrowings right now related to AI and data centers is truly staggering.

But it’s not just tech spending that’s driving the bond market. Let’s not forget about the US federal government, which is on track for a $2.1 trillion deficit this fiscal year.

That's just the NEW amount of debt they have to borrow this year just to keep the lights on and pay all the Somalis.

The White House is asking Congress for a $1.5 trillion Pentagon budget next year, more than 40% above this year's and the largest defense request (as a percentage of GDP) since World War II.

So between tech spending and the federal deficit, that’s already several trillion dollars in capital that needs to be borrowed from the bond market... THIS YEAR.

************************

Here’s the problem: America’s “net private savings”, i.e. the sum of ALL undistributed corporate profits, plus total household net income, is only about $2.2 trillion.

In short, the federal government already requires nearly ALL of the net private savings from literally every household and every company across America... just to make ends meet.

Meanwhile the biggest foreign lenders are backing away.

Japan, the UK, and China— the three largest foreign lenders to the US government— all cut their Treasury holdings in June. China now has their lowest Treasury holdings since 2008, down more than 13% from last year.

In short, foreigners are not coming to the rescue. So there is very little capital left over to lend for data centers and AI expansion.

And that says nothing about the tens of millions of other borrowers— small businesses, home buyers, etc. who need to borrow money.

This is why interest rates are rising— it’s simple supply and demand: demand for capital is at an all-time high. Yet supply of capital (at the moment) is fixed. And when the supply/demand fundamentals of capital get out of whack, interest rates rise.

Families who need to buy a home now are standing in the same line as Google, Meta, and the Treasury Department, competing for the same money.

That’s why the average 30-year mortgage rate is 6.7%, and will likely go MUCH higher from here...

... unless the Fed starts printing money again.

Technically the Fed doesn’t physically ‘print’ anything, it’s all electronic. And they don’t call it ‘money printing’, because that would be too embarrassing. They refer to it as ‘quantitative easing’. But it has the same effect— increasing the supply of capital to meet the demand, thus causing interest rates to fall.

Mortgage rates fall. Treasury yields fall. Everyone is able to borrow for less.

Which sounds great... except that conjuring money out of thin air invariably triggers more inflation. So if you can borrow more cheaply but have to pay more for everything, are you really any better off?

It’s obvious the White House wants the Fed to cut rates... which means firing up a fresh round of Quantitative Easing. And Congress certainly won’t mind being able to borrow more.

Pretty much all politicians, regardless of party affiliation, want lower interest rates. Given the choice between high mortgage rates and higher inflation, politicians will pick higher inflation every time.

And that's exactly why it makes sense to have a Plan B.

To your freedom,   James Hickman    Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/trends/your-mortgage-is-now-competing-with-google-and-the-pentagon-155777/?inf_contact_key=f6a8067b0948e6ee63b3e9b16095e046509ac0dcb420ec3d789d53e3f8627507

Breaking Down $15 billion Spent on California's Train to Nowhere

Breaking Down $15 billion Spent on California's Train to Nowhere

Notes From the Field By James Hickman (Simon Black / Sovereign Man)  August 28, 2026

In November 2008, California voters approved a ballot measure to build a bullet train from San Francisco to Los Angeles.  It was supposed to be fast enough to make the journey in under three hours. And passengers could hop on by 2020, for a total cost of $33 billion.

Eighteen years later, there is nothing to ride.

Emblematic of the progress so far is a field outside Fresno, where lonely viaducts poke into the sky with no rail connecting them. The locals call it their own Stonehenge.

And the state’s 2026 revised business plan now says it will cost $126 billion to complete... by 2040. Eighteen years into a 12-year project, they’re now saying they need another $93 billion and 14 more years.

Why is the price nearly four times higher than the original estimate?

Well, let’s try to answer that by tracking where the $15 billion already spent has gone.

The California High-Speed Rail Authority's own business plan shows that about $9.1 billion went to three construction contracts covering 119 miles of the project. Those contracts are for the civil work only, meaning dirt, pipes, power lines, and concrete.

For that, California got about 80 miles of finished roadbed, i.e. the raised, graded earth that the track will eventually sit on, plus various bridges and overpasses.

In case you’re not keeping score, that works out to $77 million per mile... but that doesn’t include the actual train tracks.

No, California plans on building the rail, the electric wire, and the signals with an additional $3.5 billion contract— which was just awarded in June (i.e. 18 years in to a 14-year project).

And $3.5 billion of rail only encompasses a very small portion of the total distance they need to build.

For a rough comparison, Brightline— a private company in Florida— finished a Miami to Orlando line in 2023, with 235 miles of track, stations, and trains, for about $6 billion, or $25 million a mile.

So California’s is three times what Florida’s cost WITHOUT including the cost of the rail, the trains, and the stations.

Extraordinary. Where did all this money go?

They claim that $1.57 billion went to buying property— the narrow strip of land under the 119 miles (i.e. less than a third of the project).

But if you look at real estate prices in the area (Central Valley farmland went for about $12,000 an acre when the buying started), the actual land value was worth maybe $35 million at the time.

In other words, the state OVERPAID what the land was worth by 30x. I’m sure absolutely zero politicians or their families profited from that overpayment.

The next $3.6 billion went to studies, i.e. environmental reviews, and something the state calls “program-wide support”. That's the second-biggest item on the bill.

The Authority started in 2008 with ten employees and hired a consulting firm to run the project. By 2018 the state had grown its own staff to about 190, with the consulting firm employing 485 people on the job.

This outside firm is generating hundreds of millions of dollars per year to do nothing.

When the state auditor went looking for what all those people had produced, 145 of the 184 deliverables were missing.

Not deliverables like rails and bridges. We’re talking about reports. The consultants couldn’t even manage that.

Governor Gavin Newsom's reaction was to promise a purge. Yet the same firm still runs the project. And every slip in the schedule means the firm gets paid more. In fact this year's plan added another $145 million for consultants.

In July the project's own Inspector General wrote that the Authority "has obscured basic facts about the project" and made oversight harder for the legislature.

For example, in January, the Authority agreed to pay one of its contractors $537 million to settle nearly 600 claims for extra costs.

What claims? Were the claims real? Nobody knows, because nobody has audited it. The Inspector General, whose job that is, says his office is half-staffed. Maybe he should hire an outside consulting firm.

How could anyone look at all this and not see the same kind of fraud the Somalis are running in Minneapolis?

You take tax dollars and funnel them through layers of government employees, consultants, contractors, and unions, all of them tied to the political establishment. In return, those people spend a slice of their ill-gotten gains keeping the politicians who make it possible in office.

California's version may be ‘legal’ graft. But that hardly makes it different. It might be worse, since at least in Minneapolis the people on the take can be prosecuted.

Who's to say the contractor didn't earn an extra $537 million? Who's to say the consultants' reports weren't worth every dollar of the $3.6 billion?

And when someone tries to get to the bottom of it, they make asking questions illegal.

Nick Shirley, the YouTuber whose video of empty tax-funded Minneapolis day cares went viral last Christmas, walked into a Los Angeles immigrant-services nonprofit this summer and asked where the $80 million in government money it has taken over the last four years went.

But they were ready to silence him, because two months after the Minneapolis video, that same nonprofit had co-sponsored a bill letting its staff sue anyone who posts videos of them online. Newsom signed it into law on Saturday.

Starting in October 2027, anyone who works at, volunteers at, or gets help from an immigration nonprofit can sue whoever posts their picture online, for at least $4,000 plus attorney's fees.

And these are the same people who mock anyone who suggests an election might not be secure.

Why wouldn't you trust them to count the mail-in ballots at 3 a.m.?

Nobody should bet a family's future on these people getting better. The tax-funded gravy train isn't slowing down if they have anything to do with it.

And that's exactly why it makes sense to have a Plan B.

To your freedom,  James Hickman   Co-Founder, Schiff Sovereign LLC 

PS: Schiff Sovereign Premium is our guide to building that Plan B: legally cutting your tax bill, gold and precious metals strategies, research on undervalued real asset businesses, and diversification moves that keep your money and your freedom of movement out of any one government's reach.

Breaking Down $15 billion Spent on California’s Train to Nowhere | Schiff Sovereign

Pot, Meet Kettle: China Is Lecturing America About Debt

Pot, Meet Kettle: China Is Lecturing America About Debt

Notes From the Field By James Hickmasn (Simon Black / Sovereign Man)  August 27, 2026

Several days ago, just as America’s national debt topped $40 trillion for the first time, China's official propaganda outlets took the opportunity to mock the United States over this ominous milestone.

Xinhua is the Chinese government's official news agency, and they published a scathing commentary comparing the US national debt to Frankenstein and his monster. They noted both were "destroyed by the forces they had set in motion," and that America "risks a similar end."

Another Xinhua social media account mocked the US government for borrowing new debt to pay back old debt, joking, "sounds like a perfect plan."

And a different Xinhua piece warned that US Treasuries were transforming from a rock-solid “risk-free” safe haven asset into a source of volatility.

Xinhua’s comments are not wrong. $40 trillion an insane amount of debt, and if you include state and local debt across the United States— New York, California, Chicago, etc., the total gross debt grows to $44 trillion.

The worst part is that few politicians are serious about cutting the debt, or even slowing down the borrowing. Congress can't even cut hundreds of billions of dollars' worth of obvious fraud.

But the criticism is pretty rich coming from the Chinese Communist Party.

America's federal debt is roughly 125% of GDP. Even including state and local debt it’s 135% of GDP.

But China's is 107% of GDP— so it’s not like the CCP is some paragon of spending restraint! And that 107% number is just what they publicly acknowledge.

Here's one example of an accounting trick China uses to keep its full debt off the books.

For decades, Chinese cities weren't allowed to borrow directly. So as an alternative they set up government-owned companies to do the borrowing for them.

These government-owned companies built the subways, the industrial parks, and the apartment towers, but the debt sat on the companies' books instead of the government's.

In November 2024 China's government finally admitted to trillions of dollars worth of this hidden debt. And they announced a five-year plan to move it onto their official balance sheet.

America's debt has been growing steadily: a horribly grotesque, absurdly wasteful $2 trillion per year since 2020. But China's debt takes a quantum leap every time the CCP tells a little more truth.

And by the IMF's count, China's real government debt comes to 135% of GDP this year... dead even with America's.

But Chinese debt pulls way ahead of the US when you factor in actual private debt held by companies and citizens.

Chinese corporate debt, for example, sits at 143% of GDP. US company debt is about HALF of that level. And let’s not forget that the biggest Chinese borrowers are state-owned enterprises where the politicians are ultimately in charge. So I’m suuuuure those company audits are totally above board...

The real question is HOW is this money going to be paid back. And by WHOM?

In January, China's statistics bureau reported that just 7.9 million babies were born in 2025, down from 9.5 million the year before... and the fewest in modern China's history. China’s fertility rate is 0.96, not even half of what it takes to keep a population steady. And China’s population shrank for the fourth year in a row.

America's debt will land on the next generation, which is bad. But at least America HAS a next generation.

Decades of the idiotic one-child policy left China with families with (hopefully) one worker supporting two parents and four grandparents. That same worker will now inherit his share of China’s debt at 135%+ of GDP.

America's fiscal challenges are immense. But they can be solved with common sense solutions— eliminating obvious fraud, making government more efficient, scaling back regulations that hamstring small business growth, reforming the immigration system, reforming Social Security.

China, on the other hand, needs a time machine to solve its problems. And since no such time machine exists, they just cook the books.

Seriously. A shrinking population is deadly for a nation’s economy. China can’t go back in time to reverse its one-child policy. And they can’t fix it with immigration either— because few people want to move to China!

This is why so many Chinese companies are developing robotics— it’s an absolute necessity there. But even this comes with a major social cost, i.e. higher unemployment.

And China cooks the books on those numbers as well.

When youth unemployment hit 21.3% in June 2023, the bureau suddenly decided that its methods of calculating unemployment needed immediate changes.

Plus any criticism or complaining leads to imprisonment... or worse.

In October 2020, Jack Ma, Alibaba's founder and then the richest man in China, gave a speech in Shanghai saying China's banks ran on a "pawnshop mentality" and its regulators were out of date.

Two weeks later the Chinese government killed his payments company's stock listing, which would have been the biggest in history, and Ma disappeared for three months.

This method of control is why no one can really trust anything from the Chinese government.

That includes their attitude that they will some day rule the world.

When President Trump visited Beijing earlier this year, Xi Jinping asked whether China and the United States could "overcome the so-called Thucydides Trap," the theory that a rising power and the one it threatens end up at war.

China's government has spent years telling anyone who'll listen that America is finished and China's time has come.

America does have challenges. And there is still some time left to get its house in order to avoid serious consequences.

But China is not its replacement.

To your freedom,  James Hickman   Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/trends/pot-meet-kettle-china-is-lecturing-america-about-debt-155725/?inf_contact_key=eb1da73d8ce85b2d02f50ae082ab6b5845f52772a67910d275469a1ff0808c0a

Congress Built This Mess They’ve Made Sure They Don’t Live In It

Congress Built This Mess. They’ve Made Sure They Don’t Live In It.

Notes From the Field By James Hickman (Simon Black / Sovereign Man)  August 25, 2026

King Hammurabi of Babylon had a simple rule for home builders: if the house you built collapsed and killed its owner, you were put to death.

That was law #229, carved in stone almost 4,000 years ago. And some version of this rule has existed for most of human history. Even to this day, it’s a tradition among architects to spend the night under a bridge they designed to prove that it’s safe.

Bottom line, people who built things were often expected to eat their own cooking and suffer the successes and consequences of their work.

The United States Congress has spent decades perfecting the opposite arrangement.

Start with the salary. Members of Congress earn $174,000 a year, more than double what the median American household makes. Yet Congress would like you to know how painful that is.

Senator Tommy Tuberville calls the job a "sacrifice." Representative Pramila Jayapal complains that "most of us get paid less than our chiefs [of staff] at this point."

Current and former members are suing the government, demanding retroactive cost-of-living raises, with claims as high as $420,000 apiece.

Bear in mind, again, that Congressmen already make $174,000 per year. Yet the House of Representatives averages just 150 days in session per year. And last year's legislative calendar scheduled just 137 days.

Most Americans work at least 250 days a year. So, adjusting for actual days worked, Congressmen are actually earning nearly $300,000 based on a normal work year. So the pay gap between everyday Americans and their Congressional representatives is even greater than at first glance.

And just how do they fill their 150ish work days? The Democratic Congressional Campaign Committee once handed its incoming freshmen a model schedule:

Four hours of the day went to fundraising calls. Another hour to something called "strategic outreach", i.e. being aligned with the party bosses. The actual job of representing constituents gets, maybe, 3-4 hours per day.

By the party's own math, half of a congressman's day goes to keeping the job rather than doing it.

This is insane. A welder doesn't get to spend half of his day persuading people to let him keep his job; rather, if he doesn’t want to get fired, he simply has to do a good job. Pretty simple.

But members of Congress can't run on their records, because their record is the insane world that we all live in.

So they spend their days telling lies to donors in order to raise enough money to tell more lies in TV commercials and email blasts. Anywhere else, this cascade of lies would be considered criminal fraud. In politics it’s just campaigning.

And in a few weeks, those campaign pitches will even receive a special pass around Gmail's inbox filter: starting September 8, 2026, Google will let verified political committees bypass it entirely, just in time for the midterms. Your inbox has rules; their fundraising has an exemption.

But the exemptions don’t stop there.

Thanks to Congress, Americans are required by law to have some overpriced health insurance plan. But politicians have a special plan, with taxpayers footing the vast majority of the premium... plus coverage for life once a member qualifies for retirement after serving just FIVE years in Congress.

So the same people who built the most unaffordable healthcare system in the world exempted themselves from ever feeling the pain.

Pensions repeat the pattern: members elected before 2013 earn a pension that accrues nearly twice as fast as a regular federal worker's, collectible as early as 50. They let Social Security drift toward insolvency for you. For themselves, they built a backup.

Then there's the stock trading. A corporate executive who trades on confidential information goes to prison. Congress never bothered to apply those rules to itself until the 2012 STOCK Act.

That might explain how former House Speaker Nancy Pelosi went from a roughly $3 million net worth when she entered Congress in 1987 to an estimated $280 million today. It’s all apparently due to her husband's extreme investment prowess.

But she's far from the only one. Must all be a wild coincidence.

Even after the 2012 STOCK Act which required politicians to disclose their stock trades, nothing changed. Seventy-eight members broke that law in a single term— yet in the fourteen years since the STOCK Act, not a single one has been prosecuted for insider trading.

Even Speaker Mike Johnson says, "Look, at least let them, like, engage in some stock trading, so that they can continue to, you know, take care of their family."

Imagine the private-sector version: if JP Morgan announced a new campus in Texas and its CEO, Jamie Dimon, bought up the surrounding land to sell to his own company, he'd be indicted before the concrete cured.

Congress runs that trade every day, on information you'll never see, and calls it “taking care of their family”.

Then you’ve got their housing perks.

Representatives can bill taxpayers for their living costs in Washington DC— up to $276 a night for lodging, plus a $92 meal allowance.

What’s interesting is that this is a recent adjustment going back to just 2023. Congressmen were ‘suffering’ the worst inflation in four decades. Rather than acknowledge that they themselves were instrumental in creating that inflation, they cooked up a bailout for themselves so that they wouldn’t have to pay sky-high prices.

In short, you pay higher living costs. Congressmen bill you for theirs.

Congressmen also routinely get sweetheart deals from banks and mortgage brokers; during the 2008 financial crisis, for example, America’s largest housing lender at the time ran a VIP program that waived fees and cut prices on home loans for politicians and key staffers.

Everyone else pays the going rate— 6% to 7% today. Politicians get special terms, and I’m sure there are no strings attached.

An organization that never feels its own failures has no reason to fix them. The debt, the inflation, and the fraud keep compounding no matter who wins.

Hammurabi figured out the fix 4,000 years ago: make the builder liable for his own construction. Congress has spent decades making sure the roof always comes down on somebody else.

To your freedom,  James Hickman   Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/trends/congress-built-this-mess-theyve-made-sure-they-dont-live-in-it-155711/?inf_contact_key=94d6a43466f13366ecd5a486a82d8f33b6ab370699ebb21cbbd41069d1f1344d

The Whole World Is Stockpiling Like It's 1939

 The Whole World Is Stockpiling Like It's 1939

Notes From the Field By James Hickman (Simon Black / Sovereign Man) August 24, 2026

On June 7, 1939, US President Franklin Roosevelt signed a new law authorizing $100 million (a lot of money back then) to buy rubber, tin, tungsten, etc., and put it all in storage.

The United States was still at peace at the time. World War II had not yet broken out, and global trade was still relatively seamless.

But anyone reading a newspaper could see what was coming. Hitler had annexed Austria the year before and swallowed the rest of Czechoslovakia that March. Japan had been at war in China for two years.

Every commodity on Roosevelt’s list had one thing in common: America produced next to none of it. Nearly all of the rubber used by US companies, for example, came from British Malaya and the Dutch East Indies. A lot of tin came from Malaya as well.

Congress and Roosevelt were being appropriately cautious. And within a short time they had stockpiled hundreds of thousands of tons of these strategic assets.

Then came the War. Then Pearl Harbor. And then full-blown economic chaos.

By March 1942, for example, Japanese troops had overrun Malaya and the Dutch East Indies... meaning that about 90% of America's rubber supply vanished overnight. Fortunately, their foresight to build stockpiles cushioned the blow.

This critical lesson in self-sufficiency is easily forgotten. As long as global peace and cooperation feel permanent, governments never think about resource scarcity. They assume they will always be able to trade for what they need... so why waste money stockpiling?

But global peace and cooperation can quickly turn to conflict and tension, and that is the environment we are in today.

The last major global conflict was World War II. Before it was over, 730 delegates from 44 nations literally sat down at a conference and hammered out a new framework for economic cooperation that made the US dollar the world’s undisputed reserve currency.

As a result, every country on earth has parked its savings in US government bonds for the past eight decades.

It hasn’t always been easy. The US formally ended the convertibility between the dollar and gold in the 1970s, and there was some thought to creating a new financial system. But the dollar managed to survive as king.

The dollar’s status has also been at risk throughout this century, between the skyrocketing US national debt and heavy-handed legislation (like FATCA) that the US government forced on the rest of the world.

But, still, the dollar survived. And foreign countries kept buying dollars and Treasury bonds.

But everyone has a breaking point, including foreign countries.

The US government’s response to freeze Russian assets in 2022 was the start. Then came last year’s so-called “Liberation Day”, when decades of trade policy were upended, overnight. Then came the Iran war. And now a $40 trillion national debt with no end in sight.

This has all been enough for foreign governments and central banks to finally reverse course; at first they slowed their purchases of US Treasury bonds. Now they’re actually selling... and diversifying away from the dollar.

The immediate beneficiary has been gold. And we’ve written about this— gold is the most logical asset for central bank diversification because it is already a traditional reserve asset... plus the gold market is very large and liquid.

We believe this trend will continue; gold prices will rise as a result, and quality mining companies should prosper.

But there’s a second element to this diversification story.

After Iran closed the Strait of Hormuz— which carried a fifth of the world's oil and a host of other critical resources— every government on the planet re-learned the same lesson of World War II: trade and cooperation can vanish in an instant.

And now the entire globe feels a sense of urgency to prepare for the next conflict.

Will China invade Taiwan? Will the US and China go to war? Will Russia and NATO come to blows? Nobody knows, and no government wants to be caught flat-footed, unable to import the critical resources that their economies need to function.

In Roosevelt’s era it was things like rubber and tin.

Today, these critical resources (what we refer to as ‘real assets’) start with energy— oil, natural gas, even coal... plus uranium for some countries.

Now, not every commodity is a real asset. Sugar is a commodity... but the world would be just fine without it. No government is going to stockpile orange juice, lumber, or wool. Or even rubber anymore.

But cut off a country's oil supply and it reverts to the Dark Ages.

That’s why countries are now stockpiling the strategic assets that are the vital inputs to their economies: copper, rare earths, and even the IP and hardware that power AI.

China is the clearest example. In 2025 alone it added more than a million barrels a day to an oil stockpile and now holds roughly 1.4 billion barrels— the world's largest reserve.

When Hormuz closed and the US and 31 other countries released 400 million barrels from their emergency reserves, China barely touched its pile and by July was adding to it again.

Its nuclear-fuel imports hit a record last year too, far beyond what its reactors burn; the excess went into stockpiles. And this summer Beijing put a new $9 billion state company in charge of buying mines around the world.

Saudi Arabia, on the other hand, produces plenty of oil, so they don’t need to stockpile it. But they are building nearly two gigawatts of data centers at home rather than risk being cut off from computing power.

A government that sells a Treasury still has to put the money somewhere, and the sensible places are the assets that the US government cannot freeze... and that no central bank can print. That is why the long-term direction of gold is still up.

But it’s also why energy, industrial metals, productive technology, and other vital resources— plus the companies which produce them— have a bright future.

This is the thesis behind Schiff Sovereign's investment research newsletter, Strategic Assets. A world that no longer trusts the US government moves into gold, and a world that can no longer count on trade cooperation secures its own stockpiles.

We provide research on companies that mine, pump, and build what governments are stockpiling.

Subscribers who acted on our research locked in more than 10x on a small silver producer and more than 6x on a gold and silver producer, both in under a year.

A tin producer featured last summer is up more than 3x, a zinc producer more than 2.5x, and a tanker company about 2.5x. Across the companies we have closed out, winners and losers together, the average return is 172%.

To your freedom,   James Hickman   Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/investing/the-whole-world-is-stockpiling-like-its-1939-155699/?inf_contact_key=806f566494bd903d1681629c51858af01f4656d5a280bd26233b3d1e6f4a07a6

Shattering the Myth That Higher Taxes Can Fix the $40 Trillion National Debt

Shattering the Myth That Higher Taxes Can Fix the $40 Trillion National Debt

Notes From the Field By James Hickman (Simon Black / Sovereign Man)  August 20, 2026

In June of 1944, American soldiers were storming the beaches of Normandy, single-handedly leading the fight to defeat the Nazis.

Back home, Americans gave everything they had. Some 85 million bought war bonds. The top income tax rate hit 94%, the highest in US history. Even ordinary people paid more and more income tax to support the war effort.

This was the absolute peak of American patriotism and record high tax rates. And yet overall government tax revenue still only came to just 20.5% of GDP.

This matters. In the eight decades since the end of World War II, tax revenue in the United States has averaged between 17% and 18% of GDP... with very little variation.

The low was 14.2% in 1950, coming out of a recession, and the high was 20.0% in 2000, at the peak of the dot-com boom when capital gains tax rates were through the roof.

Yet throughout those eight decades, the overall average has remained quite steady— 17% to 18%... even though corporate and individual tax rates have been all over the board over the same period.

The reason is simple: as tax rates go up and down, people and businesses adjust their behavior. If marginal tax rates skyrocket, people stuff their earnings into tax shelters. Or they defer revenue. Or they come up with any number of ways to legally reduce what they owe.

It's human nature.

You probably heard that the US national debt just crossed $40 trillion yesterday. And on its current trajectory, there is no end in sight to the growth of that debt.

The federal government now routinely posts ~$2 trillion annual deficits... during periods of relative peace and prosperity.

Plenty of people (especially on the left) believe the answer is to tax the rich: sky-high marginal rates, wealth taxes, etc. But the historical data show that higher tax rates cannot and will not solve the problem.

According to IRS data, imposing a tax rate of 90% on people earning $2MM per year or more would theoretically generate $200 to $300 billion in additional tax revenue.

But remember human nature: people would very quickly change their behavior and restructure their affairs, and so the real additional tax revenue would collapse to less than $50 billion per year.

The same goes for a wealth tax. Charging billionaires and centimillionaires a percentage of their unrealized gains sounds like a nice idea to a socialist. But the consequences would offset most (if not all) of the additional revenue.

If Elon Musk were forced to sell 10% of his stock to pay a wealth tax, the share prices of Tesla and SpaceX would plummet.

Sure, the IRS would collect more money from Musk himself. But, nationwide, overall capital gains tax revenue would fall dramatically. So net tax revenue would barely budge.

The point is there are always consequences to raising taxes: less economic activity, slower growth, and higher unemployment. No country in history has ever taxed its way to prosperity.

What’s crazy is that an economy as large and dynamic as America's doesn't even need to run a balanced budget. Even a $1 trillion annual deficit would be OK— and a huge step in the right direction. The national debt would still grow, but as a percentage of GDP, it would shrink.

And it's not hard to get there. The low-hanging fruit is obvious: the Government Accountability Office, the federal government's own watchdog, estimates that hundreds of billions of dollars are lost to outright fraud and theft every single year.

Yet Congress doesn't seem to want to even try to eliminate obvious fraud.

And that's the easy stuff.

The harder part would be streamlining government operations and cutting waste and inefficiency... which could easily generate hundreds of billions in savings.

Harder still would be reforming entitlements, fixing immigration, and taking a chainsaw to the Code of Federal Regulations... all of which could trim spending and/or grow the economy (and hence increase tax revenue).

Again, the national debt is $40 trillion, yet Congress won't even do the easy stuff to fix it. Even worse, the media and the courts actively block and obstruct the people who do try.

We can hope that common sense will one day prevail, and that AI and nuclear power will supercharge the US economy to the point where America grows its way out of debt.

But in the meantime, there are now 40 trillion reasons to have a Plan B.

To your freedom,  James Hickman   Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/trends/shattering-the-myth-that-higher-taxes-can-fix-the-40-trillion-national-debt-155653/?inf_contact_key=31079512ee07b0eb93edd204d2f7df2b2fff72da363b354f729db1788063859c

Foreign Buying of US Treasuries Just Fell 88% in a Single Month

Foreign Buying of US Treasuries Just Fell 88% in a Single Month

Notes From the Field By James Hickman (Aimon Black / Sovereign Man) August 19, 2026

If you were to head to Bloomberg, CNBC, or Yahoo Finance this morning and see virtually all green across the board in US markets, you wouldn’t think it’s a sad day for America.

And yet, despite stocks being up and investors positively effervescent, it is indeed a sad day, because today marks the first real capitulation by the Treasury Department.

Stocks are up because the Treasury Department announced this morning that it will double repurchases of long-dated government bonds. If that sounds boring and mundane, it’s not.

For the past several weeks, Treasury yields have been skyrocketing. Our readers won’t be surprised by this— we’ve been predicting this and telling the story for quite some time.

In short, the bond market is rapidly losing confidence in America. And that’s especially true for foreign governments and central banks.

For most of the past eighty years, pretty much every foreign government on the planet parked their national savings in US government bonds. It was a no-brainer. US Treasury bonds paid interest. They were extremely liquid and could be sold in seconds. And they are backed by the wealthiest, most powerful, most creditworthy nation on Earth.

So the rest of the world happily lent their financial surpluses to the US government and asked few questions.

At peak (in 2011), foreigners owned nearly half of all marketable US Treasury bonds. Fifteen years later they hold less than a third, and that proportion is sliding quickly.

Earlier this week the Treasury Department reported that foreigners continue to trim their holdings of US government bonds. In fact, so far this year, foreigners have only purchased 7% of net US debt issuance. In June, their purchases of Treasury bonds and notes fell 88% in a single month, and once you add in the Treasury bills they sold, foreigners were net SELLERS of US government debt.

It’s not hard to understand why; between the political theater, rising deficits, and inability to cut even obvious fraud, foreigners are no longer as willing to risk lending money to America... especially when they have to take that risk for three decades (i.e. holding a 30-year Treasury bond).

As a result, foreigners are selling. And as they sell, the natural consequence of the bond market is that Treasury yields have been rising... especially for the least popular securities like the 30-year Treasury bond.

This morning the US government officially staged an intervention. They signaled to the bond market, and to the world, that they’re willing to step in and buy back their own debt in order to prop up the market.

Investors cheered. But, again, this is actually quite sad news. It is tantamount to the Treasury Department capitulating and acknowledging that they have lost the confidence of foreign investors.

We’ve been writing about this trend for quite some time, encouraging our readers to consider investing in gold... as well as gold producers.

In our most recent edition of Schiff Sovereign: Premium, for example, we wrote about three major gold companies that we believed were significantly undervalued. They’re all up 10% just this morning... because gold is on an absolute tear.

Why Gold?

As foreign governments and central banks have been moving out of US dollars, they’ve had to park that money into some other asset. At the moment, gold is realistically the only viable strategic reserve asset that is extremely liquid, widely accepted around the world, and carries zero counter-party risk.

Foreign countries have already been buying up gold over the past few years as their confidence in the US has waned; from 2022 through 2025 they bought a few hundred billion dollars' worth— roughly 2% of their financial reserves. And that modest purchase alone took the gold price from about $1,600 to more than $4,000.

Global central banks are back in the gold market buying again today. And since we can’t exactly hold our breath that the US government is going to get its fiscal house in order anytime soon, we can only conclude that the central bank gold-buying trend will continue... and accelerate.

This trend is bad for America. But it’s good for gold. And it’s even better for gold producers.

To your freedom,  James Hickman     Co-Founder, Schiff Sovereign LLC

PS: One of the other companies we've covered in Premium, a gold producer, is up a bit this week, but we still think it is wildly undervalued. So does its own CEO, who told analysts on this week's earnings call that the company is "significantly undervalued."

It has no debt, just reported the most profitable first half in its history, and trades at roughly two times its annual cash flow.

https://www.schiffsovereign.com/trends/foreign-buying-of-us-treasuries-just-fell-88-in-a-single-month-155645/?inf_contact_key=fe0b3885637db56e3227b9f39acc60d7266def61f88c0e3dcc6731a9f494e737

How Medicare Became a Slush Fund

 How Medicare Became a Slush Fund

Notes From the Field By James Hickman (Simon Black / Sovereign Man)  August 18, 2026

Four years ago this month, Washington passed a law and named it, with a straight face, the Inflation Reduction Act.  Bizarrely, their plan to ‘reduce inflation’, which had been caused by excessive government spending, was for the government to spend even more money. It’s genius!

Among its various provisions, part of the legislation authorized the government to negotiate prescription drug prices. Seems like a nice idea in principle... but in practice it’s been a disaster.

The Congressional Budget Office released the results late last month: the Medicare drug provisions that were supposed to generate $129 billion in savings will now add $700 billion to the deficit.

Sometimes it seems like this is the whole idea; given the rampant Medicare fraud that gets uncovered on a daily basis, it’s clear that politicians have an incentive to steer MORE money into the program.

Healthcare is the easiest spending in Washington to justify. Every dollar comes with the same argument: if we don't spend on healthcare, people will die!

It ends up being so much money— a giant, dark pool of corruption— and a lot of it gets funneled straight back into the political process as campaign contributions. And it’s been going on for ages.

Back in 2002, for example, America’s biggest health-care workers union spent about $800,000 electing Rod Blagojevich governor of Illinois. He later thanked them "for electing me governor."

Weeks after he took office, Blagojevich signed multiple executive orders that fattened the union’s pockets, like forcing more healthcare workers to join... and automatically deducting union dues from their paychecks. Bad for the unionized workers, but great for the union bosses.

In New York, the Greater New York Hospital Association wrote two checks totaling more than $1 million to the state Democratic Party in August 2018, at then-Governor Andrew Cuomo's campaign's request.

Three months later the state ordered its first across-the-board Medicaid rate increase since 2008, worth about $140 million a year. Great news for the hospital association.

The cycle never ends— the unions and associations scratch the politicians’ backs, and in turn get their backs scratched. No one can rationally expect those parties to walk away from their mutual benefit.

And this is just the ‘honest’ graft and corruption... it doesn’t take into account the outright fraud.

During COVID, Medicare paid for eight test kits per month, per person, in America. Yet an inspector general later found it paid up to $454 million for nearly 39 million kits over that limit.

In June, the Justice Department found over $6.5 billion in fake health-care claims. Yet agents recovered only $182 million in cash and assets, less than three cents per dollar of fraud.

In one instance, a pair of adult day care operators fraudulently billed Medicare and Medicaid $120 million over a decade. One of their centers claimed 1,041 attendees in a single day while the building's occupancy limit was 81.

Then Nick Shirley walked into the neighborhood's facilities with a camera this summer and turned up $190 million more in suspicious billing.

And yet very little of the fraud gets stopped... in large part because a portion of what they steal from the government is funneled back to the politicians (mostly on the Left) who vote for more Medicare spending.

These same politicians install activist judges at the state and federal level, ensuring that anyone who tries to stop the fraud will be sued... and blocked by the courts.

As an example, last year Congress voted to cut off Planned Parenthood from Medicaid for one year.

Planned Parenthood sued. Judge Indira Talwani, an Obama appointee in Boston, dutifully blocked the cut within weeks, and the appeals court had to overrule her twice before the law could take effect.

Feeding Our Future, the Minnesota child-meal Somali fraud network, had the audacity to sue the state for racial discrimination when the fraudulent money train slowed down.

It’s extraordinary; there are so many checks-and-balances in place to keep the graft  going.

The politicians vote to keep the money moving. The judges defend it to the last Somali. And the activists and the media scream that anyone asking questions is racist; Governor Tim Walz called the fraud talk "vile, racist lies."

The teachers' unions march the kids out of school for union causes and No Kings rallies, as if the kids had any idea what they were marching for. And the universities continue the socialist indoctrination.

Media, education, courts: the whole institutional layer exists to keep the money flowing.

So of course they want more of it.

Senator Bernie Sanders reintroduced Medicare for All last year, and the movement that just made Zohran Mamdani mayor of New York wants to make this slush fund the entire health-care system.

Even the most conservative estimate puts the price at $32.6 trillion over the first decade; that’s an astonishing amount of potential fraud.

The US could get its fiscal house in order if it shut this slush fund down. But the graft is deeply entrenched... so it’s likely that US deficit spending will continue in order to pay for it all.

Foreign governments have reached the same conclusion: The US has to go deeper into debt in order to finance hundreds of billions of dollars in fraud.

That's a major reason why foreign governments and central banks are diversifying away from the dollar. And with no obvious global currency to park their financial reserves into, they buy gold.

We have been making this argument for the past few years, since gold was below $1800. This sort of news makes the case even more strongly: the story hasn’t changed... and gold remains a great hedge for the fiscal uncertainty to come.

To your freedom,   James Hickman    Co-Founder, Schiff Sovereign LLC

PS: In this month’s Schiff Sovereign Premium, we made the case for a gold producer built for exactly this outlook: a debt-free, dividend-paying, highly successful gold company which just had the most profitable first-half in its company history. But it only trades at 2x cash flow.

If the fraud and deficits continue, gold should do very well... and successful producers can do even better.

https://www.schiffsovereign.com/trends/how-medicare-became-a-slush-fund-155635/?inf_contact_key=45b23aa345ce3789b19a50db4e04df60121216c3a82d754a88f6751e8a28a7b5

Breaking Down Comrade Mamdani’s 30% Discount

Breaking Down Comrade Mamdani’s 30% Discount

Notes From the Field By James Hickman (Simon Black / Sovereign Man) August 14, 2026

When Walmart founder Sam Walton passed away in 1992, his family fortune made him the wealthiest person on the planet... by far. His Walton Family Enterprises was worth $23.8 billion— nearly four times as much as Bill Gates at the time. And if he were still alive today, Walton would be the second-richest man in the world, just behind Elon Musk... and ahead of Zuckerberg, Ellison, the Google guys, etc.

That’s a pretty impressive feat for a guy whose core business is basically being a gigantic grocery store.

Selling food is an extremely low margin business. And Walton’s success was built on a fanatical adherence to cost control and efficiency— being able to squeeze every penny of savings possible from the entire supply chain, and passing those savings on to the customer.

In short, he made a fraction of a cent on every sale... but generated more sales than any company in the history of the world.

It’s fascinating that Sam Walton dedicated his life to perfecting this business model. Yet Comrade-Mayor Zohran Mamdani— who has never operated a business in his entire life— thinks he can do a better job than Walton.

A few weeks ago, Mamdani’s team published their formal RFP (request for proposal) for contractors to build five city-owned grocery stores in New York City— one per borough.

Mamdani’s objective is to sell staple foods like milk, eggs, bread, etc. at a 30% discount to the supermarkets down the street.

So apparently these socialists believe that 30% is the amount that "Big Grocery" is gouging them... which shows just how little they understand about business.

Again, groceries are notoriously low margin businesses. If they sell you something for $1, their gross profit is about a penny. Cutting prices by 30% guarantees they will lose money.

Staple consumer items like milk, eggs, chicken, and bread— exactly the products that Mamdani intends to sell at a discount— are some of the LOWEST margin products in the grocery store. Grocers already sell those at rock bottom prices just to get shoppers in the door.

For example, the Giant Eagle supermarket chain sold eggs at or below cost in all of its stores during last year’s bird flu outbreak. Costco sells over 150 million rotisserie chickens a year at $4.99 and loses tens of millions of dollars on them.

Grocers treat these staples as loss-leaders; they make up for it by generating small profits from the rest of the shopping cart, i.e. items like soda, snacks, prepared foods, and specialty items.

There is simply no fat to cut on staple items... and certainly nowhere near 30%. In fact, let’s take a quick look at how the supply chain works— starting from the grocery store and working backwards.

We already showed how grocers will barely break even, i.e. they sell a staple food for $1, and they make no money.

Before them are the major food distributors who supply the grocery stores.

Sysco, the country's biggest food distributor, keeps about two cents out of of every dollar it charges. The transportation companies hauling the food keep around three cents.

One step further back is the food processor. Tyson Foods, the largest meat company in America lost a billion dollars selling beef last year. Its core chicken business is generally profitable, but highly cyclical, and they have swung to nine-figure losses when feed costs spike.

Yet even the farmers themselves who supply the processors or grow the grain typically lose money; over 1,000 American dairy farms closed last year alone, and Illinois farmers growing the feed corn are on track to lose $70 to $110 an acre on this year's crop, their fourth losing year in a row. And that’s after their government subsidy checks.

Nobody in the food chain for staple goods is making real money. Farming, feed, processing, trucking, distribution, retail: every link runs on pennies. A 30% price cut cannot come out of anyone's profit, because the profit does not exist.

Comrade-Mayor Mamdani and his merry band of socialists either don't understand that, or have decided it doesn't matter because the taxpayer will absorb it.

Now, the city won't run the stores itself. Mamdani will pay a contractor to run them... But since the stores are designed to lose money, the city will send the operator a check every year to cover the losses.

How big will the check be? Nobody knows.

But on opening day, if the city really is selling the cheapest chicken in the borough, people will come buy all of it. Restaurant managers will stock up on cheap chicken to resell to their customers. Consumers will fill their freezers with it.

All that chicken will vanish in an instant, just like a deep-discount TV during a Black Friday sale.

Naturally the Comrade-Mayor will take steps to prevent this. But how?

Initially they said you would need to show ID at the grocery store. But they quickly backtracked because, obviously, ID is racist. So now they’re pitching the idea of something like a library card.

You need to show ID to get the card, and the card to buy the chicken. But apparently that’s not racist?

Naturally the card would need to track how much chicken a single consumer purchases in order to prevent people from going to multiple stores and buying out the whole inventory.

But if that’s the case, it’s not a library card. It’s a ration card. And that’s been a staple of every socialist disaster for over a century.

Running a grocery on a tiny margin is one of the hardest operating problems in retail. Order too much fresh food and it rots in the back room; order too little and the shelves sit empty.

Walmart survives on that knife's edge with some of the most advanced logistics technology on earth.

For example, they discovered decades ago that that strawberry Pop-Tarts sell at seven times their normal pace ahead of a hurricane— which is why trucks full of them roll toward the Florida coast before a storm hits.

Capitalism works through specialization— specialists spend their entire careers perfecting one tiny sliver of that machine to claw back a fraction of a point of margin.

The farmer, the trucker, and the supply-chain engineer each spend a lifetime becoming ruthlessly good at one narrow thing, and the penny of margin is the reward for doing it almost perfectly.

Mamdani quotes Karl Marx and thinks he can do a better job... even though his government cannot even reliably pick up the garbage.

These are the same people who want to run health care, housing, and energy.

Frankly I couldn’t be happier. The socialists finally got what they wanted: they’re in power, in the spotlight. And they’re about to prove once and for all that their entire ideology is a complete and total disaster.

To your freedom,  James Hickman    Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/trends/breaking-down-comrade-mamdanis-30-discount-155600/?inf_contact_key=820d92c1ab1d1c50109c1b376181a78c6bcc35822fbfda6fe6081764d04a6051

Even America's Enemies Trusted It With Their Money. That's Over

Even America's Enemies Trusted It With Their Money. That's Over

Notes From the Field By James Hickman (Simon Black / Sovereign Man) August 12, 2026

At 4:15 in the morning on November 4, 1956, Soviet artillery opened fire on the city of  Budapest. And the subsequent firestorm was nothing short of devastating.

Two weeks earlier, students and factory workers had risen up against the Soviet-installed puppet government in Hungary. They pulled down Stalin's statue, rampaged across the city, and even managed to push Soviet forces out of Budapest.

Moscow initially signaled that it was ready to negotiate and consider a full withdrawal. The bells of freedom started ringing. But it turned out to be a ruse— and Soviet leader Nikita Khrushchev swiftly sent in the tanks.

The Soviets brutally crushed the uprising in days, killing around 2,500 Hungarians and displacing 200,000 who fled the country.

In the reprisals that followed, tens of thousands more were arrested, and hundreds were hanged— including Hungary's prime minister, who was tricked into surrendering with a promise of safe passage.

President Dwight Eisenhower condemned the invasion and opened America’s doors to roughly 30,000 Hungarian refugees. He then made his case to the United Nations, where the UN General Assembly demanded a full Soviet withdrawal from Hungary. Kruschev ignored them.

Eisenhower was clearly opposed to Soviet aggression. But America did exercise restraint— the President did not touch Soviet money that was held in the US.

It’s crazy to think that, even during the height of the Cold War, the Soviets held a stockpile of US dollars within the US financial system. They had no choice. Global commerce (including oil sales) took place in dollars, so even America’s mortal enemy needed to hold US currency.

Eisenhower could have easily confiscated Soviet assets. Yet not one Soviet account was frozen. Not one asset blocked… even as Soviet tanks shelled a defenseless European capital.

Similarly, twenty-three years later when the Soviets invaded Afghanistan, President Jimmy Carter reacted harshly. He cut off certain trade with the USSR, including grain and technology. And most famously he led a 65-country boycott of the 1980 Moscow Olympics.

But even Jimmy Carter did not freeze Soviet assets.

Decades later, in August 2008, Russia invaded the Republic of Georgia. President George W. Bush condemned the invasion, sent humanitarian aid to Georgia, and ended support for Russia's World Trade Organization bid.

Yet he did not touch any Russian money held in the US.

Three presidents from both parties, across five decades, watched America's biggest adversary invade other countries... but they still chose to keep the money out of it.

America had become Switzerland: a neutral custodian that fiercely protected anyone's savings, regardless of politics. The trust ran so deep that through every proxy war and nuclear standoff, even the Soviet Union held their enemy’s currency inside their enemy’s financial system. That’s how confident the Soviets were in America’s financial neutrality.

That wasn’t about keeping Moscow happy. It showed the world that assets in America were safe... and that was traditionally a huge reason why foreign governments parked trillions of dollars in US government bonds... and why the Treasury Dpeartment could borrow endlessly to fund its deficits.

But this policy of financial neutrality changed in February 2022, after Russia invaded Ukraine. The US pushed its allies to freeze roughly $300 billion of Russian assets.

To be clear, this is not a moral discussion. I’m not arguing whether it was right or wrong; rather, this is about setting precedent. Russia did not attack or invade the United States; they attacked Ukraine— a country with which the US did not have a mutual defense treaty.

For years leading up to the Ukraine invasion, the US government had started politicizing its financial system, weaponizing the dollar, and levying occasional sanctions when foreign countries or banks stepped out of line.

But freezing the reserves of a major power was a massive acceleration.

Consequently, America’s reputation as a financial safe haven vanished on the spot.

Foreign governments were already worried about the gigantic US national debt, political dysfunction in Washington, and deep social divisions. The Russian asset freeze was the proverbial straw that broke the camel’s back.

The first lesson that foreign nations concluded was the importance of holding gold as a strategic financial reserve.

Rather than deposit US dollars in a big Wall Street bank, or hold US government bonds, foreign governments concluded that it was much safer to have physical gold sitting in their own country— no one could confiscate it, freeze it, or inflate it away.

That’s why central banks around the world began diversifying out the US dollar and into gold: roughly 2% of strategic reserves (above normalized annual net purchases) between 2022 and 2025 was invested in gold.

And that modest shift— just 2%— caused the gold price to more than double. As we covered earlier this week, central banks plan on investing a whole lot more into gold.

Gold was the key lesson of Ukraine. Then came the lesson of Iran.

Until this year, few governments worried much about the availability of critical assets like energy, food, fertilizer, microprocessors, etc.

But then US and Israeli forces struck Iran in late February, and Iran responded by closing the Strait of Hormuz. More than five months later, the strait is still too dangerous for most commercial traffic, and many countries are running short on those same critical resources that transit the Gulf.

The lesson of Iran is that the world runs on strategic assets, and access to them can vanish overnight.

Their conclusion is that, again, rather than stockpile US dollars via government bonds and bank deposits, it makes a lot more sense to stockpile strategic assets— like fertilizer, energy, etc.

At a minimum, whenever the situation in Iran comes to its conclusion, countries will have to buy oceans of oil just to top off their strategic petroleum reserves. Our guess is they'll go far beyond that and build the capacity to store even more.

And not just oil. Anything critical and strategic is now a candidate for the stockpile, because the old days of global cooperation and easy trade are gone, replaced by mistrust, conflict, and resource nationalism.

That means base metals, rare earths, and technology itself, from memory chips to sovereign compute capacity.

This trend is still in its early stages, and the companies that own and produce these critical assets stand to do very well.

We've featured many of them, from energy to metals, in Schiff Sovereign's investment research newsletter, Strategic Assets. 

And this environment has been very good to them: several are trading at all-time highs right now; the crude tanker company we covered just reported the best quarter in its history, and a zinc producer is up almost 3x in under nine months.

In the most recent issue, we told readers about a small oil producer which is becoming a wildly successful profit machine; it has no debt, excellent management, yet trades at just three times its current free cash flow.

To your freedom,  James Hickman    Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/investing/even-americas-enemies-trusted-it-with-their-money-thats-over-155592/?inf_contact_key=b39c23af66c094617dcf76f7ba78b937b51161ba063939a3213f94f46454e7e9