Who Knows What Tomorrow Brings?

The stock market is more fragile than a newborn baby or a piece of fine china.  A word, a look can cause market fluctuations, sending analysts to their desks to … well, analyze.  The most recent example is the roller coaster ride the market took this week (and it’s only Wednesday, folks).  Volatility is the buzz word of the week on Wall Street.

Last weekend, during his trip to participate in the G20 in Buenos Aires, Argentina, Trump announced that he and China’s President Xi Jinping had reached an agreement of sorts.  My own thoughts were that it wasn’t anything more than smoke and mirrors, Trump’s attempt to make it appear as if he had at least done something to justify the cost of himself, his wife, daughter, and son-in-law travelling all that distance on our dime.  The agreement seemed to be a non-agreement, for the only thing they actually agreed to was to try to come to some agreement on trade and tariffs within the following 90-day period.  Big deal.  Whoopee.  They could have done that without announcing that they agreed to do it.  Oh yeah, and Trump also said he told Xi that he wouldn’t add any new or additional tariffs on China during the 90 days.  No doubt that had Xi wiping the sweat off his brow.

Some people are apparently not as cynical about these things as I am, for they took great joy in calling their brokers and saying, “BUY, BUY, BUY!!!”  And thus, the stock market climbed on Monday, enough to wipe out the losses of the previous few weeks … losses that had wiped out the gains from the entire year.

But then, Trump appeared to waffle about the “agreement” with a Tuesday morning tweet …Trump tariff manAnd those same people who called their brokers on Monday, placed yet another call saying, “SELL, SELL, SELL!!!”  And thus was born an all new level of volatility in the S&P, the Dow Jones, and Nasdaq, with two-day losses thus far, more than wiping out Monday’s gains and then some.  You know those playground things, basically a board on a fulcrum that are called teeter-totters, or see-saws?  They go up-down-up-down …teeter-totterThat is what the U.S. economy is on.  Market fluctuations based on anticipation of economic or political events are not unusual.  However, rarely are they as significant and immediate based on naught more than a word or a tweet from a madman!  If … IF Donald Trump were a mentally and emotionally stable leader, one might understand why such a remark would set the wheels in motion for a market tumble.  But, given his rarely-coherent state of mind, his lies and reversals, I cannot imagine why anybody would base financial decisions on one of his multitude of daily tweets.

The internet is having great fun with Trump’s new nickname, Tariff Man …Tariff Mantweet-1

tweet-2tweet-3Once again, Trump has made himself, and by extension all of us, a laughingstock.  But it goes deeper than that.  He is playing a game, the rules of which he is ignorant.  And the stakes, for the average person like you and I, are our 401(k)s, our pensions and retirement plans.  On an even larger scale, he is playing with the economic well-being of not only the U.S., but global economies as well.

Our nation is going through enough turbulence at the moment without the person who should be reliable and steadfast creating so much chaos that the major indicator of our economy is swinging on a pendulum.  I am reminded of a line from a song, Up Where We Belong by Joe Cocker and Jennifer Warnes:  Who knows what tomorrow brings?

A Big Week

As I have said many, many times, I am not an economist. I did well in the few economics courses I took in college, but have long since forgotten most of what I learned. My knowledge of economics is miniscule, though I have a basic understanding of what drives the market. However, fellow-blogger Erik Hare is an economist and has a comprehensive understanding of things that most of us only vaguely even consider. His post today gives us some insight into upcoming events in the next week and how they are likely to affect the market, so I am sharing his wisdom and expertise, in lieu of my own, which is fairly non-existent. Please take a few minutes to absorb Erik’s timely post. Thank you, Erik, for permission to share!

Barataria - The work of Erik Hare

We have in front of us a big week. This may determine the course of the next year or so in the stock market, the economy, and in politics.

A lot is about to happen. Let’s run it down, day by day.

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Why Stocks Are Falling

Curious as to why the stock market is plunging? I am not an economist, and while I have some understanding of the way the market works, I know just enough to be dangerous. So, I turn the explanations over to friend Erik Hare, who IS an economist and understands far better than I. Thank you, Erik, for well-written, understandable post!

Barataria - The work of Erik Hare

As the eight year old bull on Wall Street is slaughtered for its meat, several questions come to mind. Is the fall likely to continue? Where will it stop? And, for those on the sidelines looking to score political points, who is to blame?

The answers to these questions are easy and a little terrifying. Yes, this is going to go on for a while. It may not stop until a lot of money is lost. And while you can’t blame anyone for actions which are cyclical, you can blame those who make things worse. The US economy is a large engine, and any good mechanic knows that while you can do a few small, smart things to make it run better it is much easier to really screw it up.

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Congress – Please listen to the nonpartisan economic groups

Well, the Senate all pulled together and sold themselves to the highest bidder. We The People were not, unfortunately the highest bidders, but we are the biggest losers. The Senate, in their effort to be good little lapdogs, refused to listen to the well-educated and very experienced economists who shared a consensus about how the national debt would be negatively affected. They not only refused to listen, but some smugly claimed to disbelieve. Our friend Keith has written a post that says it all as well as I could, so I am sharing his post today, rather than re-invent the wheel. Please take a few moments to read and ponder, and I shall have an additional post a bit later. Thanks, Keith!!!

musingsofanoldfart

Early this morning the Senate passed their Tax Bill, complete with hand written amendments and no public hearings. Senator McConnell declared it a victory for the American people. But, which people? From my reading the people doing a touchdown dance already have an awful lot of money. 52% of Americans disapprove of this bill, but only the opinion of the privileged few matters.

On NPR yesterday, I heard Congressman Kevin Brady, the Chair of the House Ways and Means Committee, smugly say we do not believe the projections of Congress nonpartisan Joint Committee on Taxation who measured the Senate bill as increasing the debt by $1 trillion and saying this bill is not as kind as portrayed to people in poverty and middle class. But, Congressman, why do the nonpartisan Committee for a Responsible Federal Budget, Fix the Debt and The Concord Coalition say pretty much the same thing?

Without…

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Mike Pence is WRONG …

I don’t know when it happened, and given that he is not much in the public eye, Mike Pence’s absence was not even noted nor notable.  But sometime in the past few months, Mike Pence had a lobotomy.  Yes, folks, he had a large portion of his brain removed from within his skull.  The proof is in the following editorial he wrote (annotated by my snarky remarks, of course), published in USA Today on 08 November 2017:

One year ago Wednesday, President Donald J. Trump won a historic victory. But even more historic has been President Trump’s record of accomplishment ever since. (Reversing prior sound policy and dividing a nation are not what I would call accomplishment)

It’s been a year of action. It’s been a year of results. And it’s been a year that will be remembered as the time we began to Make America Great Again. (The only actions have been negative, and the only results have been to ruin our reputation abroad and create irreparable divisiveness on the domestic front. And define ‘great’, and ‘great’ for whom?)

Thanks to the president’s leadership, the American economy is roaring. Businesses have created nearly 1.5 million new jobs (employment rate is actually lower than it was for much of the last 4 years under President Obama – see chart at bottom). Manufacturers haven’t been this confident in 20 years. The stock market is setting records (it is an unsupported rise and when it crashes, as it will, millions will lose everything), creating nearly $5 trillion in wealth for the pension, retirement and savings of the American people. And after eight years of lackluster growth, the economy has already expanded by at least 3% for two quarters in a row. (the GDP met or exceeded 3% eight times under Obama)

The U.S. economy is making a comeback because President Trump has taken decisive action to spur a new era of opportunity, prosperity and growth. (The trend began under the Obama administration)

We’ve unleashed American energy, approved the Keystone and Dakota pipelines, and under President Trump, the “war on coal” is over. (There is no longer a vast market for coal, as sustainable energy sources, ie wind and solar, have proven cleaner and less expensive. Coal mining is a dinosaur destined for extinction)

We’re appointing originalists to the federal courts, to uphold the Constitution and all our God-given liberties. And President Trump put Justice Neil Gorsuch on the Supreme Court. (the rights to which you refer are given under the Constitution, they are not “God-given”. You imply God gave the right to carry guns? Further, the framers of the Constitution fully intended it to be a living document, interpreted in such a manner as suited the times, realizing that changes would come that they could not imagine)

President Trump has also taken decisive action to ensure the safety and security of the American people, at home and abroad. He has stood without apology with the men and women of law enforcement. We’re securing our borders, enforcing our laws and taking the gang members, drug dealers and violent criminals off our streets. (The majority of our crime is committed by white male citizens, not Hispanics, not Middle-Easterners.  No wall, no travel ban, can protect us from the average John Doe with a gun)

The president is putting our veterans first. He signed bills to restore accountability to the Department of Veterans Affairs and give veterans access to the world-class care they deserve.

We’re rebuilding our military. President Trump has already signed the largest increase in defense spending in nearly 10 years, and we are working with Congress to pass one of the largest investments in the national defense since the days of Ronald Reagan. (We already had the single largest military budget in the western world — see chart below — and yet we would take health care from millions to expand the already bloated military budget)

With renewed American strength, the president is achieving real results on the international stage. (True, we have gone from a well-respected ally to the laughingstock to a pariah, all in just 9 short months)

Our NATO allies are contributing more to our common defense. ISIS is on the run, and its caliphate is crumbling (to the extent this may be true, the credit belongs to many, not solely to Trump). This president reaffirmed the credibility of American power when he enforced a red line against chemical weapons in Syria (killing civilians willy nilly in the process). He put Iran on notice and made it clear that we cannot certify the Iran nuclear deal (the deal was being upheld by Iran and there is no reason for us not to certify it). And our administration has brought unprecedented economic and diplomatic pressure to bear on North Korea. (all he has done is increase the risk of an armed conflict by taunting Kim Jong-un)

It has been a year of accomplishments, and we’re just getting started. Before this year is out, we’ll pass historic tax cuts for the American people. And with President Trump’s leadership, I know: We will Make America Great Again. (If the tax cuts pass, it will only raise the deficit and hurt the very people who most need help, while helping those who need it least)

One year after the 2016 election … I remember crying that night, and now I remember why. Either Mike Pence has had a substantial portion of his brain removed, or he is on hallucinogenic drugs, or he is so afraid of Trump that he is toeing the Trump line.  Whichever it is, he is wrong.


Employment Rates 2007 – 2017

jobs chart

military spending

Bits ‘n Pieces of This ‘n That

mind-bounce.jpgMind bounce, as I call it, Grasshopper mind as our friend David calls it … whatever you call it, it is sometimes annoying, other times a good thing.  It is when your mind refuses to settle on any one topic for very long, bouncing from hither to yon, seeking to know something about everything.  I believe it is more prevalent in this, the era of Trump, for there are so many different things happening all at once that one cannot pick just one topic.  So, today I gave in to the mind bounce and instead of one single topic, I am doing a bit of this and a bit of that …


Donnie Junior …

Those who donate to the Trump campaign (yes, they are still soliciting donations, for I occasionally get an email asking for a contribution) will no doubt be happy to know where their contributions are going.  Mostly, it seems, they are being used to pay Donnie Trump Junior’s massive legal fees.  The Federal Election Commission (FEC) reports that the Trump campaign spent $267,924 on Junior’s legal fees from July through September.  The figure includes $237,924 for Junior’s personal attorney, Alan Futerfas. Another $30,000 went to Williams and Jensen, which helped Junior prepare for Congressional testimony.

And if you donated to the Republican National Committee (RNC), hoping that your contributions would help with various republican candidates’ campaigns, you have also helped Junior, for the RNC spent more than $200,000 on his legal fees, with most going to Alan Futerfas.

In total, more than a half million dollars have been spent on Junior’s legal fees for his utter ignorance when he attempted to collud with the Russians to bring Hillary Clinton down last year.  Two observations:  1) Junior isn’t too bright, but that seems to run in the family, 2) Alan Futerfas is racking up some big money from the Trumps.


More of the Harvey Weinstein show …

Once the sexual harassment claims against Harvey Weinstein became public, it was like an avalanche, with one, then another finally feeling free to speak up.  Gwyneth Paltrow and Angelina Jolie were among the two most well-known.  Last week, it was announced that Weinstein had been expelled from the Academy of Motion Picture Arts and Sciences.  Some actors, such as Matt Damon and Ben Affleck are scrambling to distance themselves from Weinstein and claiming to have had no prior knowledge of his exploits.

weinstein-allen

Woody Allen & Harvey Weinstein

On the other side, however, there is Woody Allen, the comedian who was accused, but never convicted of sexually abusing his step daughter. Allen referred to the Weinstein case as a ‘witch hunt’.  (Hmmmm … where have I heard that term before?)  Allen called “the whole Harvey Weinstein thing” a situation that is “very sad for everybody involved. Tragic for the poor women that were involved, sad for Harvey that his life is so messed up.”

I initially said that I did not believe Weinstein would ever see the inside of a jail cell, but now I’m not so sure.  He just might, and personally I hope he does.


Up … Down … Either way, Trump wants credit

up-downWhen the stock market soared earlier this year, Trump claimed sole credit. The reasons for the surge, of course, are more complex and largely have less to do with Trump than he would have us believe.  But last week, Trump announced a new health care policy in which the federal government will halt its practice of paying insurance companies for subsidizing health care for low-income people, effectively shafting some 20 million people. Insurance stocks plummeted, and Trump claims proudly that this, too, signals his success.

“Health Insurance stocks, which have gone through the roof during the ObamaCare years, plunged yesterday after I ended their Dems windfall!”

Does this ‘man’ not understand anything? Does he think that only democrats own stock in insurance companies?  Or does he think that all the lower income people who were beneficiaries of the insurance subsidies are democrats?  And, given that the Congressional Budget Office (CBO) projects that his stroke of the pen will increase the federal deficit by $21 billion by 2020, does he not realize … oh, never mind … of course he does not …


A lack of respect …

In the 10 days since four Green Berets were ambushed and killed in Niger, President Donald Trump has used his Twitter account to attack a sports commentator, call for a curtailing of the free press, denigrate his political enemies, sell a book, draw attention to Vice President Mike Pence’s public protest at taxpayers’ expense, and congratulate himself for a job well done.

green beret.jpgYet he’s failed to say anything about the four U.S. service members killed in Western Africa: Staff Sgt. Bryan Black, Staff Sgt. Jeremiah Johnson, Staff Sgt. Dustin Wright, and Sgt. La David Johnson. About a dozen troops were ambushed on Oct. 4 while on a joint patrol with Nigerien troops; five Nigerien soldiers were also killed. This marks the deadliest-yet engagement for U.S. troops since Trump took office, and yet Trump himself has issued no tweets or personal statements about the matter, 10 days after the fact.


And yet another climate-change denier enters the White House …

Last Thursday, Trump nominated Kathleen Hartnett White to lead the White House Council on Environmental Quality. Ms. White not only denies that man’s contribution to a changing climate is destroying our environment, but she actually claims to believe that increased carbon dioxide in the atmosphere is good for humanity!!!

kathleen-white

She has described efforts to combat climate change as primarily an attack on the fossil fuel industry. Christy Goldfuss, who served as managing director of the White House Council on Environmental Quality under President Barack Obama, said …

“Her views are so out of the mainstream, it’s almost as if she falls in kind of a flat earth category. Her number one task is to rip and throw out the environmental laws that this whole country has come to accept as standards and norms.”

Let us hope that the Senate will have enough sense not to confirm this nominee!

I envision the job ad for any position in the Trump administration as including a line that reads: “only liars and people with an IQ of less than 50 will be considered.”


Thus concludes the detritus from the bouncing mind of Filosofa for today!  Now, perhaps since I got all that out of my head, I can focus?  Have a great day, folks!spider