Saturday, January 6, 2018

No, don't worry, Trump's actually a very stable genius

CNN - Trump: "I'm a very stable genius". Well, I guess we're all okay then:

"Actually, throughout my life, my two greatest assets have been mental stability and being, like, really smart," the President continued. "Crooked Hillary Clinton also played these cards very hard and, as everyone knows, went down in flames. I went from VERY successful businessman, to top T.V. Star ... to President of the United States (on my first try). I think that would qualify as not smart, but genius ... and a very stable genius at that!"

Darn right! And there's nothing that screams stability more than still fixating on Hillary Clinton a year after the election!

Or desperately trying to defend your mental status on Twitter!

Friday, January 5, 2018

All the Trump news, mental instability edition

Ha ha, turns out Trump is an incompetent retard who didn't even want to be president, you Republicans are idiots:

BBC - Trump seen as a child by staff. Quote:
Mr Wolff has hit back against White House attacks, saying the president has no credibility and that "100% of the people around him" question his fitness for office.

He added that White House staff described the president as childlike because "he has the need for immediate gratification. It's all about him... This man does not read, does not listen. He's like a pinball just shooting off the sides".
To be fair, the Republican party's god nowadays is a B-movie actor who was senile while in office.

CNN - book hits Trump where it hurts most: his ego. Quote:
But as Washington consumes a sensational West Wing exposé by journalist Michael Wolff, Trump is being forced to watch as his prized image is ripped to shreds.

When a presidency is anchored so fundamentally on an image, as it is with Trump, rather than a long history of political achievement or ideological consistency, any deterioration of that image can be especially perilous. For Trump, who may be more conscious of how he is perceived than any politician in history, the mockery is likely to be especially painful.
To be fair, most of the Republican insiders got heir start in politics working for a short balding sweaty man who was so paranoid that he recorded his own illegal schemes on audio tape.

BBC - everyone's talking about Trump's mental illness. Quote:
In his book, Fire and Fury, journalist Michael Wolff writes that President Donald Trump is showing worsening signs of mental decline.

"Everybody was painfully aware of the increasing pace of his repetitions," he writes in Hollywood Reporter.
To be fair, um... shit I already brought up Reagan. OK, the Republican party's ideological leader is a son of a goldbug who worships a Russian immigrant sci-fi author who hated socialism while spending her entire old age collecting welfare.

Vox - even psychiatrists are saying Trump should be evaluated by force. Quote:
Yet there is a growing call from a group of psychiatrists — the best medical experts at interpreting aberrant human behavior — for exactly this: an emergency evaluation of the president’s mental capacity, by force if necessary.

Leading this call is Bandy Lee, an assistant professor in forensic psychiatry (the interface of law and mental health) at the Yale School of Medicine who has devoted her 20-year career to studying, predicting, and preventing violence.

She recently briefed a dozen members of Congress — both Democrats and Republicans — on the president’s mental state. And this week, she, along with Judith Herman at Harvard and Robert Jay Lifton at Columbia, released a statement arguing that Trump is “further unraveling.” In October, a collection of essays from 27 mental health professionals that Lee edited, The Dangerous Case of Donald Trump, was published.
Come on! Everyone in the Republican party is a narcissistic psychopath with delusions of conspiracies. You'll have to do better than that!

The Guardian - Donald Trump eats McDonald's for fear of being poisoned? Quote:
Trump’s answer to the poisoning threat is to eat McDonald’s, by preference, all the time; the burger chain never knows he’s coming, and it’s all pre-made. This has the distinct ring of post-hoc justification – it would be much more reliable to get a nine-year-old to sit next to him and pre-taste his food. Besides which, even if the staff of McDonald’s don’t in general know who’s coming, it would be unusual for them to feed the president without a heads-up. Much more likely, Trump fears poison and he really likes McDonald’s.

This, too, was an open secret from the time of his trip to the Middle East, when his trailer requests read like the death row meals in a dystopian movie about 100 people all getting electrocuted on the same day.
OK... she wins.

Friday video: Cry goldbugs cry, 2018 edition

Here's a nice sad song for the goldbugs to set the tone for 2018:

Thursday, January 4, 2018

Calculated Risk - FOMC on the new tax legislation

Calculated Risk - FOMC opinion on the Trump tax plan.They don't think it'll do much to change their situation, besides maybe giving them a little extra impetus to raise rates more, which anyone could have told you.

But also, this:

However, some business contacts and respondents to business surveys suggested that firms were cautious about expanding capital spending in response to the proposed tax changes or noted that the increase in cash flow that would result from corporate tax cuts was more likely to be used for mergers and acquisitions or for debt reduction and stock buybacks.

So it's simply going to pump a larger swing upward in the stock market.

Because asset valuations are the place where you see the elite plutocracy's demand-pull "inflation".

Wednesday, January 3, 2018

Bonddad - commodities and inflation

Bonddad - commodities and inflation. Turns out you don't have to run a worthless $400/yr weekly newsletter of wordsalad to notice that metals and energy have been on an upward tear for the last year.

Bonddad notes that this doesn't particularly mean that actual US inflation numbers are going to pick up. I'd respond, though, that for someone like me all that matters is what is going to happen with traders' perceptions of inflation: those, after all, are what really drive commodity prices.

Book on the laughingstock Trump presidency

NY Mag - Donald Trump didn't want to be president, tried not to win the presidency, and his entire team thought he was unfit to be president. My god, it's full of derp:

From the start, the leitmotif for Trump about his own campaign was how crappy it was, and how everybody involved in it was a loser. In August, when he was trailing Hillary Clinton by more than 12 points, he couldn’t conjure even a far-fetched scenario for achieving an electoral victory. He was baffled when the right-wing billionaire Robert Mercer, a Ted Cruz backer whom Trump barely knew, offered him an infusion of $5 million. When Mercer and his daughter Rebekah presented their plan to take over the campaign and install their lieutenants, Steve Bannon and Conway, Trump didn’t resist. He only expressed vast incomprehension about why anyone would want to do that. “This thing,” he told the Mercers, “is so fucked up.”


Shortly after 8 p.m. on Election Night, when the unexpected trend — Trump might actually win — seemed confirmed, Don Jr. told a friend that his father, or DJT, as he calls him, looked as if he had seen a ghost. Melania was in tears—and not of joy.

There was, in the space of little more than an hour, in Steve Bannon’s not unamused observation, a befuddled Trump morphing into a disbelieving Trump and then into a horrified Trump.


Early in the campaign, Sam Nunberg was sent to explain the Constitution to the candidate. “I got as far as the Fourth Amendment,” Nunberg recalled, “before his finger is pulling down on his lip and his eyes are rolling back in his head.”


Priebus had his own reservations: He had come out of his first long meeting with Trump thinking it had been a disconcertingly weird experience. Trump talked nonstop and constantly repeated himself.

“Here’s the deal,” a close Trump associate told Priebus. “In an hour meeting with him, you’re going to hear 54 minutes of stories, and they’re going to be the same stories over and over again. So you have to have one point to make, and you pepper it in whenever you can.”


The truth was, Ivanka and Jared were as much the chief of staff as Priebus or Bannon, all of them reporting directly to the president. The couple had opted for formal jobs in the West Wing, in part because they knew that influencing Trump required you to be all-in. From phone call to phone call — and his day, beyond organized meetings, was almost entirely phone calls — you could lose him. He could not really converse, not in the sense of sharing information, or of a balanced back-and-forth conversation. He neither particularly listened to what was said to him nor particularly considered what he said in response. He demanded you pay him attention, then decided you were weak for groveling.


If he was not having his 6:30 dinner with Steve Bannon, then, more to his liking, he was in bed by that time with a cheeseburger, watching his three screens and making phone calls — the phone was his true contact point with the world — to a small group of friends, who charted his rising and falling levels of agitation through the evening and then compared notes with one another.

As details of Trump’s personal life leaked out, he became obsessed with identifying the leaker. The source of all the gossip, however, may well have been Trump himself. In his calls throughout the day and at night from his bed, he often spoke to people who had no reason to keep his confidences. He was a river of grievances, which recipients of his calls promptly spread to the ever-attentive media.


As soon as the campaign team had stepped into the White House, Walsh saw, it had gone from managing Trump to the expectation of being managed by him. Yet the president, while proposing the most radical departure from governing and policy norms in several generations, had few specific ideas about how to turn his themes and vitriol into policy. And making suggestions to him was deeply complicated. Here, arguably, was the central issue of the Trump presidency, informing every aspect of Trumpian policy and leadership: He didn’t process information in any conventional sense. He didn’t read. He didn’t really even skim. Some believed that for all practical purposes he was no more than semi-­literate. He trusted his own expertise ­— no matter how paltry or irrelevant — more than anyone else’s. He was often confident, but he was just as often paralyzed, less a savant than a figure of sputtering and dangerous insecurities, whose instinctive response was to lash out and behave as if his gut, however confused, was in fact in some clear and forceful way telling him what to do. It was, said Walsh, “like trying to figure out what a child wants.”


During that first month, Walsh’s disbelief and even fear about what was happening in the White House moved her to think about quitting. Every day after that became a countdown toward the moment she knew she wouldn’t be able to take it anymore. To Walsh, the proud political pro, the chaos, the rivalries, and the president’s own lack of focus were simply incomprehensible. In early March, not long before she left, she confronted Kushner with a simple request. “Just give me the three things the president wants to focus on,” she demanded. “What are the three priorities of this White House?”

It was the most basic question imaginable — one that any qualified presidential candidate would have answered long before he took up residence at 1600 Pennsylvania Avenue. Six weeks into Trump’s presidency, Kushner was wholly without an answer.

And hilariously, the guy who wrote this book about the clusterfuck of the Trump presidency was able to get all this inside information because he just hung around the White House and nobody had the authority to ask what he was doing there or tell him to leave.

Tuesday, January 2, 2018

A response to all the Daniela Cambone searches

Yes, I'm still getting hundreds of "is Daniela Cambone married?" searches on this blog, even years after the fact, which would maybe be nice if this blog is monetized, which it isn't.

And I don't fucking get it really, because as I've noted several times before, Daniela may be nice and all that but she isn't half as attractive as former Cambridge House interviewer Vanessa Collette, and yet I never see searches for her.

I mean, just look at how cute Vanessa is here, interviewing perennial blog fave Jeff Berwick in 2013:

No comparison with Daniela, right? I mean, Even Jeff is stunned by the otherworldly radiance of Vanessa's transcendent beauty, and he normally only gets a woodie for Ludwig von Mises.

So, after looking at the blog stats and seeing all the bloody annoying Daniela searches (and for the record yes, Daniela is married, and her wife's name is Susan and is very pretty), I decided to search for Vanessa Collette to see what she's up to.

And good god damn, she's still a huggable little angel:

She can also make nice-looking food.

I've never ever seen Daniela make food.


Not even a hot dog.

And we're off to the races...

So as it turns out, gold really was walked down purposefully by market manipulators at the end of December, and that data is now confounding the TAs who trust charts above everything else. One major rule of TA is that you have to know when to disbelieve.

Gold is up over $1310 to start the year, and it probably will hit $1400 this year, and eventually stay there. And you can know this with some certainty, because oil and copper have already come off their multiyear lows, and that has happened because the late part of a US secular bull market always sees inflationary pressure in commodity prices.

This cyclical sort of pop isn't responded to by suppliers with investment in new production the way a secular pop is, because (a) they have cut back on exploration for the past few years so there's nothing to put into production, and (b) everyone in commodity production knows that the price at the late stage of a US bull equity market is not a price you can base long-term capital investment decisions on.

There's your simple macro analysis that doesn't involve reading 50 pages of a rank amateur's word-salad every week.

Does a cyclical commodity bull bode ill for your SPY position?

Well, on the one hand, secular equity bull markets don't die on their own.

On the other hand, they can be killed by policy, and Trump is doing a great job of that by providing a massive tax cut that. If it were meant to stoke inflationary consumption pressure, it would be responded to by the Fed with rate hikes that would completely offset the benefit. Also, if it were meant to be deficit-neutral, it would also be responded to with massive entitlement cuts to eliminate the deficit that the Republicans have just blown up, which would mean cuts to consumption at the low end of the income spectrum.

Ultimately, a kleptocratic rentier economy is deflationary and exhibits no or negative growth. That is also basic macro.

And lurking in the background is the bitcoin bubble, which definitely is a bubble and you might want to look at whether or not your bitcoin position is easier to liquidate than a position in a Venture stock that only does $5000 in volume per day. Ever try to liquidate that sort of thing? How about on a bad day when the buy side of the order book has dissappeared? Hm?

I don't think bitcoin can become so stupidly huge a bubble that it blows up the financial system the way MBSes did... but then again, it can still become stupidly more bubbly to the tune of a further 1000% gain, at which point it does become biggish.

So as for the S&P 500, if the US equity market is going to drop in the next 2-3 years, it's good to remember that secular tops take years to draw their charts; we're probably at the rounding top now, and anyone with a long horizon should sit on what they have with a sell stop to limit losses, and wait to buy 20% lower x years from now.

Are FANGs dead, as someone on BNN was talking about yesterday?

No. Because it's impossible for anyone to supplant the market position of Google or Amazon. Netflix and Apple maybe, if entry is cheap enough. Eventually. No, Tencent and Baidu aren't going to supplant them in the part of the world that matters, though they can continue getting market share in East Asia.

As for me?

This winter I'm taking a break from studying economics, and instead doing a bunch of classes on transport policy and GIS.