The takeaway: Trump flexes his strongman muscle and boxing skills …
Yesterday’s dressing down of Volodymyr Zelensky, president of Ukraine, by U.S. President Donald Trump, I am sure, caught many a viewer off guard. The sitting room where the President has a photo-op chit chat with other world leaders tends to look staged with phony grins and handshakes.
There were no phony grins and handshakes here as both President Trump and his constitutional sidekick, Vice-President J.D. Vance, laid into Mr. Zelensky for his lack of gratitude regarding the help that the United States has been providing to Ukraine in its attempt to repel Russia’s invasion of the eastern European country a little over three years ago.
Mr. Trump also pointed out to Mr. Zelensky two inconvenient truths. First, Ukraine is getting its ass kicked. While the Russian war machine has been slogging it out (by some accounts it has already achieved its territorial goals), Ukraine has lost hundreds of thousands if not over a million people due to the fighting.
Second, Mr. Trump vehemently pointed out that Mr. Zelensky and Ukraine has no leverage. Not only is he losing, but he needs US coin to keep the war going.
I won’t litigate who is right or wrong in this conflict. I will say it is time for it to end.
Mr. Zelensky got in a quick jab on Mr. Vance when the Ukraine president asked the VP whether he has visited Ukraine leaving Mr. Vance to admit that he had not. Mr. Zelensky has the advantage of the ground-eye view so you would think that he has some intel that backs up his confidence that he can prevail. Messrs. Trump and Vance beg to differ.
My instincts tell me that this meet-and-greet blow up was manifestation of underlying tension between the two leaders. Mr. Zelensky has to validate his leadership by not giving any more ground to Russia. This conflicts with Mr. Trump’s professed aversion to all-out war. But as Mr. Trump points out, he has the leverage.
I expect Mr. Trump to tell Mr. Zelensky that he is willing to call off the Russian Bear if Zelensky commits to some concessions, i.e., access to rare earth materials in Ukraine. Mr. Zelensky will counter-punch that NATO has his back and that Mr. Trump should not broker an agreement that goes against NATO’s interests. Mr. Trump will duck that punch and hit Mr. Zelensky with a combination uppercut and right hook. He will tell Mr. Zelensky that the United States is NATO and has no problem leaving an economically declining Europe holding the bag to finance a war against Russia.
Mr. Zelensky has no leverage and Americans wishing for the US to encourage a protracted war should reconsider their delusion.
Alton Drew
1 March 2025
The data …
U.S. Treasury rates
On 28 February 2025, the two-year, ten-year, and thirty-year Treasury rates continued their downward trend. According to Treasury data, the two-year rate fell from 4.07% to 3.99%. The ten-year rate fell from 4.29% to 4.24%, while the 30-year rate fell from 4.56% to 4.51%.
Federal Reserve Bank of New York reference rates
On 28 February 2025, the Federal Reserve Bank of New York reported that the Effective Federal Funds Rate for domestic unsecured borrowings between commercial depository institutions is at 4.33%. The Overnight Bank Funding Rate, a measure of wholesale, unsecured overnight bank funding costs, also held at 4.33%.
The Secured Overnight Financing Rate, which measures the cost of borrowing cash overnight secured by Treasury securities, came in at 4.36%, while the Broad General Collateral Rate, a measure of rates on overnight Treasury general collateral repurchase agreement transactions, came in at 4.34%.
The Tri-Party General Collateral Rate, a measure of rates on overnight, specific counterparty, tri-party general collateral repurchase agreement transactions, came in at 4.34%.
U.S. Congress
HR 146, a bill that prohibits the payment of interest on reserve balances held at a federal reserve bank, is currently with the US House Committee on Financial Services.
On 4 March 2025, the U.S. House Task Force on Monetary Policy, Treasury Market Resilience, and Economic Prosperity will hold a hearing will that focuses on the Federal Reserve’s monetary policy tool kit and its influence on economic well-being in the United States.
DISCLAIMER: I am not a financial adviser. These blog posts are for educational purposes only. Trading of any kind involves risk. Your trading decisions are solely your responsibility. It is imperative that you conduct your own research and seek professional advice as necessary.
AFFILIATE DISCLOSURE: Some of the links on this channel are affiliate links, meaning at no cost to you I earn a commission if you click through and make a purchase.
