In this week’s Money Metals Midweek Memo, host Mike Maharrey opens with blunt news: the federal government shut down at midnight. Lights off. Doors locked. Theater on.
He argues you wouldn’t notice a real shutdown if Washington stayed within its constitutional lane. The $37 trillion debt is the tell that it hasn’t.
He reaches for Federalist No. 45. James Madison promised federal powers would be “few and defined,” centered on war, peace, diplomacy, and foreign commerce. States would handle “the lives, liberties, and properties of the people.” Today’s reality, he says, is flipped—and the Anti-Federalists foresaw consolidation smothering state sovereignty.
Thomas Jefferson warned against concentrating power “into one body.” George Mason called consolidation “totally subversive.” Maharrey’s verdict: prophetic—and visible in everything from toilet-water rules to light-bulb mandates.
Shutdown Theater vs. Real Spending
A “shutdown,” he says, leaves the war machine warring, the surveillance state spying, and the IRS collecting. What stops are the highly visible conveniences that maximize irritation and partisan blame.
He recalls Obama-era antics: Mount Rushmore closed, “website is not available” banners, and an elderly couple told to leave their Lake Mead home. Pain without logic, designed to score political points.
Don’t fixate on sound bites. Watch the deal-making. The final act ends the same way: more spending, more borrowing, more debt.
What’s Actually in Play: CR, Obamacare Subsidies, and the Senate Math
The fiscal year ended yesterday without a blueprint for FY 2026. The House passed a Continuing Resolution to hold funding at FY 2025 levels through November 21st.
But the Senate needs 60 votes. Chuck Schumer and Democrats want the CR to restore Obamacare tax subsidies that expired on October 1st and add other health-care tweaks. Mike Johnson calls it a partisan “laundry list.” Hakeem Jeffries counters: “Cancel the cuts. Lower the cost. Save healthcare.”
Republicans frame it as benefits for illegal immigrants; Maharrey calls that oversimplified. About 90% of exchange enrollees receive tax credits because coverage is extremely expensive. Politics, not prudence, is steering the vehicle.
Even “Clean” Keeps Growing
The House CR still tucked in hikes: security for federal officials, higher rates for the Treasury’s terrorism and financial-intelligence account, and boosts for some SBA guarantees. The CBO flagged these as targeted increases while mandatory programs roll on autopilot.
Flat funding isn’t good news, he adds. With one month left in FY 2025, Washington had already spent $6.73 trillion, up 5.9% from FY 2024 year-to-date.
The pattern is iron-clad: “cuts” usually trim the increase—baseline budgeting in action. The FY 2026 bill will still spend more than this year.
The Engine: Federal Reserve Policy and Perpetual Inflation
Spending at this scale demands money creation. The Federal Reserve props up the Treasury market with suppressed rates and, in crises, direct buying—demand conjured with new money.
He traces the break from gold—FDR’s severing and Nixon’s 1971 final cut—as necessary to let the Fed expand the money supply fast enough to finance Leviathan.
Result: price inflation that quietly taxes savers.
Interest expense now runs around $1 trillion per year, the second-largest line item—bigger than defense and Medicaid, trailing only Social Security. Foreign appetite for Treasuries is fading. You can’t claim inflation is conquered when inflation is the plan.
CPI Isn’t the Whole Story
The CPI is a basket-pricing tool, not a measure of monetary inflation. Its 1990s formula changes roughly halve what 1970s math would report. A 2% target quietly shaves about 10% of purchasing power every five years.
Monetary inflation shows up beyond groceries—asset inflation is the tell.
After 2008, the Fed cut to zero and launched QE. Consumer prices stayed tame, but stocks, real estate, and art ballooned.
In 2018, when markets wobbled, the Fed pivoted dovish—pre-pandemic.
Then the pandemic provided cover for a full binge: nearly $5 trillion in QE alone, keeping the prior bubble aloft.
A Century in Gold Terms: The Dow’s Hidden Decline
Price the market in real money, Maharrey says. In 1929, the Dow was 381.17 and gold $20/oz—roughly 19 ounces to “buy the Dow.”
Yesterday, the Dow was just over 46,300, and gold was around $3,800/oz—about 12 ounces. That’s a 37% decline in the Dow when priced in gold over 96 years.
Gold exposes what fiat hides. A fine suit cost a bit over an ounce of gold a century ago; it’s still about an ounce today.
Silver’s Setup and the Case for Junk Silver
Silver nearly touched $48/oz, slipped, and rebounded above $47—knocking on $47.50. The all-time high is $50. With the gold-silver ratio over 80:1, silver screens are undervalued versus gold.
Supply is tight. Industrial demand is hot. Investment demand is rising. Many technicians think a decisive break above $50 could run quickly.
He highlights junk silver—pre-1965 U.S. quarters, dimes, and half dollars at 90% silver. A 1964 quarter holds melt value of over $8 today, far above face value. Premiums are unusually low—“as low as 49 cents per troy ounce” for dimes and quarters—compared to peaks near $15 over spot in 2023. He likes it for barter resilience and wealth preservation.
What You Can Control
You can’t vote away structural incentives to spend and print, Maharrey argues. Politics is power first, prudence later—if ever. Expect more can-kicking.
Shield yourself instead. Hold real money—gold and silver—that can’t be printed. Buy what you understand, ask questions, and think in purchasing power, not just dollar price.
Housekeeping, Links, and What’s Next
Maharrey plugs his book, Constitution Owner’s Manual, a clause-by-clause tour guided by ratification-era meaning.
He asks listeners to review and share the show on Apple Podcasts, Spotify, and elsewhere. For news and market coverage, he points to MoneyMetals.com/news and the weekly Market Wrap.
This Friday, he teases a conversation with economist Daniel Lacalle.
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