1) Is He Gone Yet?

We've generally defended Fed Chief Jerome Powell when Trump has wanted to fire him.

So now it's time for us at the HOTLINE to do something we hate doing: admit we were wrong.

Sure, the Fed must be politically independent. But it should also be competent and apolitical. Right now, the Fed checks neither of these boxes.  

Could a high school economics student have been more wrong than the Fed on the direction of the economy this year?

Powell and his gaggle of 300 PhD economists predicted 1.6% growth for the second half of this year. Instead, the last two quarters have yielded results twice that high with 3.8% growth in Q2 and 4.3% announced last week for Q3.  The latest Q4 estimate by the Atlanta Fed, as of December 23, is 3% growth. Without the government shutdown, we would have stayed on the 4% growth path.

Powell consistently attacked Trump's tariffs as inflationary, and in some cases deservedly so. But he completely downplayed all of the pro-growth Trump policies: trade deals that have attracted hundreds of billions more capital to these shores, the Big Beautiful Tax Bill, the hundreds of deregulatory actions, and the pro-America energy policies. These supply side policies have helped stabilize prices.

The Fed has been wrong on inflation, growth, and interest rates.

Three strikes and you're out, Jerome.

2) Welcome to Hollywood Squares

There's a bidding war going on to purchase Warner Bros. Discovery in what could be Hollywood's biggest blockbuster deal ever.

So far, there are two main contestants. Netflix has agreed to buy the film and streaming businesses of Warner Bros. Discovery for $72 billion in potentially the biggest Hollywood deal ever.

Meanwhile, Tech billionaire Larry Ellison has offered a sweet $40 billion cash offer. Paramount Skydance can acquire Warner Bros. Discovery. This isn't Monopoly Money we're talking about.

There are lots of moving parts here that we won't get into, but you can read the latest here.  

Acquisitions like this almost always benefit the shareholders of the acquired company. Thousands of new millionaires will be hatched either way, and small shareholders will benefit hugely as well as both deals will jack up the share price.  Isn’t free market capitalism a grand thing?

So here’s the question of the day: who should decide which offer to accept and the terms of the deal?

A) The Justice Department
B) The FTC
C) The courts
D) The White House
E) The shareholders

If you didn’t pick E, you don’t believe in private property rights and free market capitalism.

The busybodies in Washington want anyone BUT the shareholders to decide. They worry about antitrust hobgoblins. In reality, there are few if any industries LESS likely to seize market power than entertainment/movie making/video streaming, which has thousands of players and is all going to change overnight with the coming AI revolution.  

3) Federal Spending on Obamacare Has DOUBLED Since 2020

We noted this in the HOTLINE several weeks ago with our back of the envelope math. Now, we have validation from Johns Hopkins Professor Ge Bai and TCU Professor Elizabeth Plummer in the WSJ:

Using health insurers' mandatory filings, our study, published Friday in JAMA Health Forum, shows that the ObamaCare individual market has become a money pit for taxpayers. In 2024 they paid nearly 80% of the premiums for subsidized plans--compared with only 30% in 2014.

Taxpayers paid more than $114 billion directly to insurers in 2024--one-third more after inflation than in 2023, more than double the amount in 2020 (before the enhanced subsidies), and more than six times as much as in 2014. According to the Congressional Budget Office, this acceleration continued in 2025.

The chart below from the JAMA study shows that premiums have exploded in plans that receive subsidies and the increase was entirely at taxpayer expense.  That is the red portion of the chart. But premiums have been flat in unsubsidized plans.

There’s an economic lesson here: if you subsidize something, you get more of it.

4) Our New UPN Ad: Stop Subsidizing Big Insurance Conglomerates

Guess who’s most in favor of expanded Obamacare subsidies?

If you didn’t shout out “the insurance companies,” - you’re not paying attention. They’ve gotten fat and happy off the “Affordable Care Act.” One person who gets this is DJT.

Over the Christmas holiday, Unleash Prosperity Now launched a new six-figure TV and social media ad highlighting President Trump's commitment to lowering health care costs by putting patients, not large health insurance corporations, first. Put the health dollars in the hands of patients and get rid of the insurance middle man.

Let us know what you think!

Voiceover: What's driving skyrocketing health care costs?

Trump: Gigantic health insurance companies that have gotten rich on billions of dollars of money that should go directly to the people.

Trump: They've been ripping off the public for years. Billions and billions of dollars is paid directly to insurance companies.

Voiceover: President Trump's plan is simple.

Trump: You, the people, are finally going to be getting great health care at a lower cost.

Voiceover: Thank you, President Trump, for taking the fight to corporate health insurers, and finally, putting American patients first.

5) US Dominates Post-Lockdown Recovery

We made grievous policy errors during the first two years of COVID, when the economy and schools were shut down. But thankfully, red states with great governors like Ron DeSantis kept their economies mostly open for business, and Trump opened up most activities far faster than most other nations.

Now, we see the results five years later. The chart below shows the USA has grown much faster than all our major competitors.

Germany STILL hasn't reached its pre-lockdown GDP!

The lesson: lockdowns were a disaster and we must NEVER, NEVER allow this to happen again.

6) We’ve Got a Big One on the Line - Can We Reel it In?

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