Ganging up on the Donald

PARIS – Poor Donald Trump. Everybody’s against him.

Jeb Bush says he’s “unhinged”…

…Chris Christie says he has “no idea what [he’s] talking about”…

…John Kasich accuses him of “outrageous divisiveness”…

 

loveThe Donald – in reality, they love him…

 

…and Marco Rubio describes him as “offensive and outlandish.”

And those are just his fellow Republicans!

“Reprehensible… prejudiced…” adds Hillary Clinton.

Piling on, Martin O’Malley says Trump is a “fascist demagogue.”

Can a man with enemies like these really be bad? More below…

 

New Low for Oil

U.S. stocks slipped yesterday. No big deal. The press looked around for something to pin it on. All it could find was falling oil prices. The price of the black goo fell below $38 a barrel to its lowest level since the depths of the global financial crisis.

 

1-WTICWTI crude oil retests its late August low on slightly lower volume, waylaid by a warmer than expected autumn and OPEC’s inability to turn off its spigots. We have added a small Elliott Wave count of the most recent moves since the August low, and one question that suggests itself to us is: is there anyone left who is not bearish on crude? Even before the most recent wave of selling, the optimism index for crude had declined to its lowest level in more than 14 years – click to enlarge.

 

You’d think cheaper energy would be a good thing. Don’t company profits – outside of the oil patch – go up when the cost of fuel goes down? Don’t households have more money to spend? Shouldn’t other things be looking up when oil is looking down?

Oil is the biggest expense of the transportation industry. Lower prices should drop right to the bottom line as extra profits. But the problem is not the cost side; it’s the revenue side.

As we reported yesterday, rail and truck shipping in the U.S. is slowing – signaling a slumpy economy with weak demand. And corporate profits are on the way down, too… dragged down by the energy sector. The whole kit and caboodle seems to be funking up.

 

Under the Hood

Which is just what you’d expect – partly because central banks’ “stimulus” measures were a sham (about which we’ve written more than enough) – and partly because every expansion comes to an end after a few years.

The National Bureau of Economic Research studied the U.S. all the way back to 1854. It found that the typical economic expansion lasts 39 months. This one began in 2009. By our count, that makes more than 75 months without a breather. On that basis alone, you’d expect a little more caution on the part of investors.

But there is one supposed exception to this somber picture… a bright light coming from the shiny bumpers of the auto industry. Rail shipments are down for everything – except autos. And “strong auto sales” are said to be proof of a healthy consumer economy.

 

2-Car loansAn explosion in motor vehicle loans – click to enlarge.

 

Uh… that is, once again, if you don’t open the hood. The industry has been so corrupted by cheap credit that it is misleading even to talk about auto “sales.” The typical loan period has stretched to 67 months, as the industry reached for more marginal (read: sub-prime) buyers.

The proud new owner reports to his friends that he has “bought a new car.” But at a 5% interest rate, reports Bonner & Partners researcher Nick Rokke, that means the buyer only gets 1/77th of the car when he allegedly “buys” it.

 

3-subprime car loansRelative growth rates of sub-prime car loans vs. car loans to people with strong credit scores – click to enlarge.

 

Readers who are quick with numbers will notice that the length of the average sub-prime auto loan, the length of the current business expansion, and the length of time that the Fed has maintained its zero-interest-policy are all clustering around 70. Perhaps this is more than a coincidence.

But back to the big news…

 

Looney Leanings

Donald Trump brought the wrath, ire, and contempt of the mainstream political establishment down on his head yesterday. He called for a “total and complete shutdown on Muslims entering the United States.”

Most commentators quickly condemned him, pointing out that such a ban would be unconstitutional and completely against the principles on which the nation was founded.

 

Hair questionsAlien anchor hair discovered…

 

But in a spirit of pure mischief (a blustery billionaire hardly qualifies for our customary support for die-hards, lost causes, and underdogs), we rush to the defense of “The Donald.”

Yes, his proposal is reckless, stupid, unworkable, unfair, and un-American. But it might not be unpopular. Give the man credit. He’s running for president. To win, he needs the votes of people who are at least as block-headed as he is.

In that respect (perhaps the only respect) his latest proposal may not be a bad idea. Also, making preposterous and outrageous proposals hardly disqualifies you for the White House.

Some of our “best” presidents – at least, according to historians and the public – were those who did the looniest things… things that were completely at odds with the Constitution, the spirit of liberty, and their own policy goals.

President Lincoln told the crowd at Gettysburg that his war against the South was in line with the Declaration of Independence, which clearly asserted the right of a people to choose their own government.

The war would determine, he said, whether “that nation, or any nation so conceived and so dedicated, can long endure.” The answer was “no.” And he made sure of it.

 

ColDemands12wContemporary cartoon of Lincoln attack him over the human toll of the Union war effort. Columbia, wearing a liberty cap and a shirt made of an American flag, demands, “Mr. Lincoln, give me back my 500,000 sons!” At the right, Lincoln, unfazed, sits at a writing desk, his leg thrown over the chair back. A proclamation calling for “500 Thous. More Troops,” signed by him, lies at his feet – click to enlarge.

Image credit: Joseph E. Baker

 

President Wilson did the same thing for foreigners – invading more countries than any other president… while proclaiming the right to self-determination. Elections were fine, said Wilson, as long as they chose “good men.” If he didn’t like the men chosen… he sent in the troops.

By the standards set by Lincoln and Wilson, Donald Trump has the capacity to be one of our greatest leaders.

 

wilsonVote for Woodrow Wilson “who kept you out of war” (and didn’t saddle you with a Federal Reserve…)

Image credit: Punch

 

PS:

It doesn’t really matter who wins the race for the White House, because the Deep State already controls just about every aspect of American life. From health care, to education, to the food on our tables, to the never-ending war on terror, the Deep State is pulling the strings.

 

Charts by stockcharts, St. Louis Fed, WSJ

 

Image captions by PT

 

The above article originally appeared at the Diary of a Rogue Economist, written for Bonner & Partners. Bill Bonner founded Agora, Inc in 1978. It has since grown into one of the largest independent newsletter publishing companies in the world. He has also written three New York Times bestselling books, Financial Reckoning Day, Empire of Debt and Mobs, Messiahs and Markets.

 

 

 

Emigrate While You Can... Learn More

 


 

 
 

Dear Readers!

You may have noticed that our so-called “semiannual” funding drive, which started sometime in the summer if memory serves, has seamlessly segued into the winter. In fact, the year is almost over! We assure you this is not merely evidence of our chutzpa; rather, it is indicative of the fact that ad income still needs to be supplemented in order to support upkeep of the site. Naturally, the traditional benefits that can be spontaneously triggered by donations to this site remain operative regardless of the season - ranging from a boost to general well-being/happiness (inter alia featuring improved sleep & appetite), children including you in their songs, up to the likely allotment of privileges in the afterlife, etc., etc., but the Christmas season is probably an especially propitious time to cross our palms with silver. A special thank you to all readers who have already chipped in, your generosity is greatly appreciated. Regardless of that, we are honored by everybody's readership and hope we have managed to add a little value to your life.

   

Bitcoin address: 12vB2LeWQNjWh59tyfWw23ySqJ9kTfJifA

   
 

Your comment:

You must be logged in to post a comment.

Most read in the last 20 days:

  • Trade War Game On!
      Interesting Times Arrive “Things sure are getting exciting again, ain’t they?”  The remark was made by a colleague on Tuesday morning, as we stepped off the elevator to grab a cup of coffee.   Ancient Chinese curse alert... [PT]   “One moment markets are gorging on financial slop like fat pigs in mud.  The next they’re collectively vomiting on themselves. I’ll tell you one thing.  President Trump’s trade war with China won’t end well.  I mean, come...
  • The Dollar Cancer and the Gold Cure
      The Long Run is Here The dollar is failing. Millions of people can see at least some of the major signs, such as the collapse of interest rates, record high number of people not counted in the workforce, and debt rising from already-unpayable levels at an accelerating rate.   Total US credit market debt has hit a new high of $68.6 trillion at the end of 2017. That's up from $22.3 trillion a mere 20 years ago. It's a fairly good bet this isn't sustainable....
  • US Stock Market: Happy Days Are Here Again? Not so Fast...
      A “Typical” Correction? A Narrative Fail May Be in Store Obviously, assorted crash analogs have by now gone out of the window – we already noted that the market was late if it was to continue to mimic them, as the decline would have had to accelerate in the last week of March to remain in compliance with the “official time table”. Of course crashes are always very low probability events – but there are occasions when they have a higher probability than otherwise, and we will...
  • Rise of the Japanese Androids
      Good Intentions One of the unspoken delights in life is the rich satisfaction that comes with bearing witness to the spectacular failure of an offensive and unjust system. This week served up a lavish plate of delicious appetizers with both a style and refinement that’s ordinarily reserved for a competitive speed eating contest. What a remarkable time to be alive.   It seemed a good idea at first... [PT]   Many thrilling stories of doom and gloom were published...
  • Claudio Grass on Cryptocurrencies and Gold – An X22 Report Interview
       The Global Community is Unhappy With the Monetary System, Change is Coming Our friend Claudio Grass of Precious Metal Advisory Switzerland was recently interviewed by the X22 Report on cryptocurrencies and gold. He offers interesting perspectives on cryptocurrencies, bringing them into context with Hayek's idea of the denationalization of money. The connection is that they have originated in the market and exist in a framework of free competition, with users determining which of them...
  • No Revolution Just Yet - Precious Metals Supply and Demand Report
      Irredeemably Yours... Yuan Stops Rallying at the Wrong Moment The so-called petro-yuan was to revolutionize the world of irredeemable fiat paper currencies. Well, since its launch on March 26 — it has gone down. It was to be an enabler for oil companies who were desperate to sell oil for gold, but could not do so until the yuan oil contract.   After becoming progressively stronger over the past year, it looks as thought the 6.25 level in USDCNY is providing support for the...
  • Flight of the Bricks - Precious Metals Supply and Demand
      The Lighthouse Moves Picture, if you will, a brick slowly falling off a cliff. The brick is printed with green ink, and engraved on it are the words “Federal Reserve Note” (FRN). A camera is mounted to the brick. The camera shows lots of things moving up. The cliff face is whizzing upwards at a blur. A black painted brick labeled “oil” is going up pretty fast, but not so fast as the cliff face. It is up 26% in a year. A special brick, a government data brick of sorts, labeled...
  • The “Turn of the Month Effect” Exists in 11 of 11 Countries
      A Well Known Seasonal Phenomenon in the US Market – Is There More to It? I already discussed the “turn-of-the-month effect” in a previous issues of Seasonal Insights, see e.g. this report from earlier this year. The term describes the fact that price gains in the stock market tend to cluster around the turn of the month. By contrast, the rest of the time around the middle of the month is typically less profitable for investors.   Due to continual monetary inflation in the...

Support Acting Man

Item Guides

Top10BestPro
j9TJzzN

The Review Insider

Austrian Theory and Investment

Archive

350x200

THE GOLD CARTEL: Government Intervention on Gold, the Mega Bubble in Paper and What This Means for Your Future

Realtime Charts

 

Gold in USD:

[Most Recent Quotes from www.kitco.com]

 


 

Gold in EUR:

[Most Recent Quotes from www.kitco.com]

 


 

Silver in USD:

[Most Recent Quotes from www.kitco.com]

 


 

Platinum in USD:

[Most Recent Quotes from www.kitco.com]

 


 

USD - Index:

[Most Recent USD from www.kitco.com]

 

Mish Talk

 
Buy Silver Now!
 
Buy Gold Now!
 

Oilprice.com

Diary of a Rogue Economist