Judy Shelton, Gold Standard Chatter and Cracks in Credit: Inside DH Unplugged 821

Frequently Asked Questions

Who is Judy Shelton and what role is she taking at Treasury?

Judy Shelton, a longtime proponent of returning to the gold standard and a former Fed nominee, has been appointed as a counselor advising Treasury Secretary Scott Bessant on currencies and China's financial condition. The role does not carry a vote on Fed interest rate decisions, but the hosts view the appointment as a notable signal given Shelton's hard-money views.

Why are Horowitz and Dvorak so critical of Scott Bessant's bond-market moves?

Bessant initially planned $2–$4 billion monthly in long-dated Treasury buying, pushed one month to roughly $6 billion, and is reportedly now considering cutting long-term auction sizes and possibly eliminating 20-year bond sales. Horowitz argues these interventions amount to strong-arming the market, akin to an Operation Twist, and warns Bessant is 'messing around with gasoline with a match.'

What's happening with high-yield credit and why does it matter?

High-yield bond yields jumped from 7.22% to 8.1% in a month, and CCC-and-below spreads widened to roughly 1,250 basis points over comparable higher-grade bonds. Horowitz says the long stretch of tight spreads encouraged indiscriminate buying, and the current widening — combined with stress in French sovereign debt — signals the kind of credit cracking that historically precedes broader contagion.

What are tanker rates doing to the real cost of oil?

Horowitz notes U.S.-to-China tanker bookings are running about $80 million per voyage, roughly ten times prior levels, with one U.S. booking adding about $41 per barrel in freight alone. With WTI near $91.50 and Brent around $104, he argues the headline oil price understates true delivered costs and that shipping-driven inflation is being badly underestimated.

What is Reverse Engineer Anything and why is Slowbooks a big deal?

Reverse Engineer Anything is a new open-source tool that uses AI agents to convert compiled binaries back into source code without needing the original. Slowbooks, which appeared suspiciously soon after, is a free, local, open-source clone of QuickBooks 2003 with the same feature set — a potential 'Softwaremageddon' moment that likely invites lawsuits from incumbents like Intuit and Adobe.

How significant are Kroger's 3,000 layoffs, and does Dvorak buy the AI narrative?

Kroger is cutting about 3,000 of its roughly 10,000 corporate white-collar roles — nearly 30% — focused on finance, supply chain, procurement, real estate and HR, while keeping its 400,000-person total workforce intact. Dvorak, drawing on Fortune 500 consulting work, is skeptical AI is the real driver, suggesting it's partly an opportunistic chance to cut deadwood without spooking shareholders.

What happened with the French supermarket refrigerator hack?

Dvorak describes hackers in France using a Chinese large language model (GLM) to break into internet-connected refrigerators at a major supermarket chain, remotely switching them off and causing millions of dollars in spoiled goods. Some combination fridge-microwave units reportedly caught fire, highlighting the risks of casually connecting agentic AI and IoT appliances to the open internet.