Why Trump Won

- He is genuine in thought and action

- He is a patriot and loves his country

- He identified many issues* that were being ignored by our betters

- He promised to fix them ... and the voters believed him

- He said he would make America great again

- He knew that Washington was corrupt to the core

- And promised to “drain this swamp”

- He identified our fake media ... something that many suspected

- He wasn’t Hillary

* uncontrolled immigration, unfair trading pacts, anemic economic growth, Chinese hegemony, pointless international nation building, tolerance of terrorism at home and abroad, NATO slackers, climate change hoax, Obamacare disaster, liberal courts, insane Iran nuclear deal, North Korea nuclear and missile problems

The Debate

One would think, watching the Democrat debate last night, that our world revolves around free stuff for everyone, climate change, sexism and racism. Non-issues: world trade inequities, our growing national debt, coronavirus, Chinese hegemony, North Korean nukes, immigration reform, economic growth, national defense, impeachment and patriotism.

I’m not sure if this was because of the candidates’ myopia or cable new’s desire to stir things up.

Afterthought: Bloomberg has said he would back whomever wins the Democrat nomination ... now, except possibly Liz Warren...

The Debate

I tortured myself last night by watching about an hour of the final Democrat debate in New Hampshire. What a bunch of myopic nothingness! I swear that the only candidate that was not embarrassingly pandering to “blacks, browns and people of color” was Amy Klobuchar (well maybe a little.) I must have heard the word “racism” snarled a hundred times. 

The rest of the arm-waving rhetoric was centered around various schemes to extract more tax money or silly ways to spend it. Do any of these candidates think beyond our shores ... or other than how to get minorities to vote for them? What about China’s hegemomy, federal deficits, stopping illegal immigration, entitlement spending, Muslim extremism, North Korea and Iran nukes, economic growth strategies, NATO policies, Middle East peace, etc.

One would think that the sun rises and sets on a very few domestic issues ... mostly of the vote-buying nature. What a waste of TV viewers’ time. The Democrats need to do something drastic if they don’t want to be swept away in November!

Headlines

Trump pushes forward conservative transformation of Medicaid

Trump impeachment trial: Senators ask final questions before critical witness vote

Republicans could move to quick acquittal vote ... claim momentum ...

Graham there are ‘53 Republican votes to call Hunter Biden’

Wilbur Ross says coronavirus could bring jobs back to the U.S. from China

GM resurrecting Hummer as ab all-electric ‘super truck’ with 1,000 horsepower

Mexican economy suffers first contraction in decade ...

Impeachment poll: 47% for removal, 48% against

U.S. economy grew at moderate 2.1% rate in fourth quarter

Economic growth looks even weaker this quarter virus now a wild card

Fed pumps another $82 billion ...

Netanyahu in Moscow to discuss Mideast peace plan

Headlines

Pelosi fiercely defends impeachment inquiry as Trump blows up

Dow plunges more than 500 points as big tech shares lead the decline

What happened to Trump’s boast of 4%, 5% or even 6% economic growth?

Nancy Pelosi: Democrats launched ‘inquiry’ not ‘outright impeachment’

Trump set to hit EU with tariffs on $7.5B of goods after Airbus ruling

Bernie Sanders undergoes procedure for artery blockage, cancels events until further notice

Americans spend more on taxes than food, clothing, health-care — combined!

Poll: Trump re-election support unmoved by impeachment inquiry

Support for impeaching Trump hits new high

At half of US colleges most students go on to earn less than $28,000 a year

Greece struggles to survive as migrant arrivals soar ...

Private payrolls beat expectations with 135:000 jobs in September

Trump’s Reality

American political divide today boils down, pretty much, to those willing to live in President Trump’s reality ... and those who refuse to do so. The dissonance often occurs in the way that Trump communicates his world view ... spiced with bravado and, sometimes, harsh invective. This style, frequently communicated via Twitter, rubs many the wrong way and, to resolve this discomfort, they reject his reality out of hand. Big mistake.

This rejection then compounds their foolishness ... because they are forced to grow more and more semantically convoluted in their inane rationales for their resistance. We are told Trump has lied 12,000 times ... so his reality must also be false. How are these many lies possible? Does he lie when he states his name or what he had for dinner? We are told he is a white supremacist when his popularity with blacks and Hispanics grows daily. We are told he is anti-semantic while his son-in-law and daughter are Orthodox Jews. We are told he is growing senile when his schedule would daunt a much younger man. All these accusations are part of the strained rejection of his reality.

Trump’s reality on immigration, world trade, American exceptionalism, Islamic terrorism, nuclear threats, global warming, race relations, etc. are a whole lot closer to middle-America’s psyche than his opposition. This is why many Democrat presidential candidates have staked out such extreme positions ... just to demonstrate how opposed they are to Trump’s views. Big mistake. They are out on a limb of their lack of policy reality ... and Trump has saw in hand.

Hearts and Minds

Many celebs infected with Trump Derangement Syndrome need to understand how their heated rhetoric may affect what the White House is trying to do vis-a-vis our China trade war, North Korea denuclearizing, Iran normalization, fixing immigration, radical Islamic and domestic terrorism, economic growth, Russian neutralization, etc. Do these overly exorcised people really want our country to fail in these efforts?

I am not suggesting that these spittle-flecked ranters need to kiss Trump’s ring ... but perhaps they could resist their baser instincts for a trice ... and try to stay out of the banner headlines. I doubt if this continued fulminating is the way for them to win the hearts and minds of the majority of American people.

Boiling the Frog

“The era of economic surrender is over.” — President Donald J. Trump

Trump is turning up the heat on China. He says that he will impose 10% tariffs on the remaining $300 billion of imports from China starting September 1st. Last December he slapped 10% tariffs on $250 billion of imports from China ... then raised them to 25% in May when China reneged on a deal that had been almost fully negotiated. If China does not make the huge agricultural buys that it has committed to (but already reneged on once), I fully expect that this second tranche of tariffs will go to 25% sometime next year. Trump is slowly boiling the frog ... or, should I say, dragon.

As I have often predicted, China is obviously hoping against hope that Trump will lose the election next year and that he will be replaced by an Obama clone (maybe even Michelle) in order to be restored to the old status quo. Obviously, the tariffs that Trump has so far imposed have slowed down capital investment by US companies ... which has, in turn, slowed our economy by about one percentage point. If and when higher tariffs go into effect, economic growth may slow further which would reduce Trump’s chances of getting re-elected ... which is also likely part of China’s strategy. However, if this gambit does not work, China will end up with a worse deal in 2021 (as Trump has warned.)

The other predicted bugaboo is the threat of US domestic inflation. This has been anticipated from our previous tariff impositions ... but, so far, nada ... a good sign that China is mostly paying these tariffs with lower prices and a devalued currency. Also US companies are beginning to move manufacturing out of China ... a trend that may well accelerate this Fall if China continues to be recalcitrant. This cannot be a trend that China relishes. But will it blink first and jump out of the boiling pot? As Trump often says, “We’ll see what happens.”

Trump’s Legacy

I know it’s rather early to start considering what Trump’s legacy will be. But there are some rather clear things that he has changed that will live on after he has departed the White House. Here are my takes:

- The president’s “magic wand” of tax cuts and regulation reforms has kicked up the rate of economic growth to above 3% from the previous “new normal” of below 2%. And the stock market is up over 50% combined with energy independence, strong consumer confidence, employment and domestic manufacturing. And inflation has been modest to boot. Not bad!

- The U.S.’s national image will have flipped from apologizing for our success to being proud of it ... and resolving to return to our past glories. We will have recaptured our greatness ... and be proud of it.

- Like Ronald Reagan did to restore our defense dominance, so Donald Trump will be equally lauded ... but he will also be praised for his restraint in using this military might. In the process, he has put, at least for the moment, North Korea and Iran in a box. If either of these countries capitulates, it will be the first sentence in his history book write up.

- Exactly opposite to the current media narrative, NATO will have been substantially strengthened by Trump’s insistence that our European partners live up to their financial and troop obligations under this decades-old pact.

- Although Trump will not have destroyed terrorism, he likely will have partially defanged it.

- Despite enormous sticky resistance in Congress and in the courts, Trump has made some progress in securing our borders and reforming our immigration process ... less than the majority of Americans want ... but still progress.

- Trump’s agenda has pushed the Democrat party to show its colors as being far more radical left in its actions than its deceptive rhetoric.

- If nothing else, President Trump will be remembered for his focusing on how China has become a hegemonic threat to America ... and his developing strategies to counter same. So far his success here has been modest but, if re-elected, I expect much more progress.

Fed Mandates

Our  Federal Reserve Chairman Powell testified today at Congress ... and, as often is the case, the mandate of the Fed was mouthed again ... as it often is. It was not questioned. It was just mouthed. I find it interesting that no Congressperson questioned this mandate.

The Fed’s mandate, as previously set by Congress is just two fold: Full Employment (now specified as a 4% unemployment rate) ... and Low Inflation (now specified as a 2% inflation rate). And, interestingly, both these objectives are now being surpassed ... by quite a bit. Inflation is now running at 1.6% and our unemployment rate is at 3.7%. Wow! The Fed has surpassed both their mandates!

Had I been questioning Powell today, I would have asked him if it is not time for Congress to rethink these mandates and, possibly, update or add to them. I have broached this topic before and have some suggestions for some updates for the Fed’s mandates:

- Economic Growth — certainly the Fed assumed this temporary mandate during Obama’s administration with its Quantitative Easing strategy — the huge expansion of its balance sheet by almost four trillion dollars. Basically, this meant the Fed bought huge amounts of government  and mortgage debt ... pumping lots of money into the economy to drive up the prices of assets ... like stocks, bonds and housing ... and thus hold the economy’s head above water.

- Fair Trade — President Trump is in the midst of a trade war with China and other countries to bring down serious balance of payments problems. And trade wars often involve the price of the dollar at those countries with whom we are negotiating new trading policies. A strong dollar can easily negate the impact of any corrective tariffs imposed upon trading foes.

- Monetary Flows — There are such large disparities now between interest rates in the US and elsewhere (as much as 3 percentage points) that this disparity creates huge carry trade imbalances. Yes, right now this may help America finance our deficits ... but this might not always be the case. (Could this same flow be accomplished with a smaller differential?) Therefore, it would seem to this observer that our Fed should keep a wary eye on the difference between world-wide interest rates in setting our own rate ... in order to manage international money flows.

Therefore, rather than just the current mandates, I would suggest adding at least the above three objectives to the Fed's portfolio ... particularly during times when its existing two are being easily met ... like now.

New New World Order

Donald Trump won the U.S. presidency under the banner that championed Nationalism over Globalism. This theme is now spreading around the world .. to the chagrin of the Davos billionaire elites. However, Trump's message carries much more ideology than just the supremacy of nation states over (an unelected) world government. Here are a number of the battles that also define Trump's message ... you decide what side Trump favors:

Open Borders vs. Sovereignty

Global Warming vs.Self-modulating Climate

Capitalism vs. Socialism

Economic growth vs. Stagnation ("New Normal")

Diversity vs. Homogeneity (a tough one)

Populism vs. Authoritarianism

AI vs. Human Cognition  (another toughie)

Freedom vs. Enslavement

Privacy vs. Personal data capture (evolving)

Free trade vs. Fair trade

Headlines

NAACP says MLK's vision can't be achieved without fighting 'global warming' ...

Chris Mathews skips 'Meet the Press' appearance amid harassment scandal

Paper: Drug dealers openly using Facebook to target kids ...

Narrative busted: Trump's support among black voters has doubled since 2016 ...

Trump: Hawaii officials 'made a mistake' with false alert

North Korea knows what Seoul wants, and it is willing to ruin everything if its demands aren't met

Violence in Tijuana worsens with 1,744 homicides in 2017 ...

Illegal immigrants fleeing U.S. To Canada -- disappointed

Historians have long thought Populism is a good thing. Are they wrong?

Trump blasts Dems 'DACA is probably dead'

Mohammed most popular baby name in Netherlands ...

WSJ: Economists credit Trump with [improved] economic growth

MAGA Trump

Is Trump often childish? Sure. Does he taunt him enemies mercilessly? Of course ... often uncomfortably. Does he relate his version of the truth independent of what the media and the Left believe? Too often. Is he an orator? No, he lowers his voice when he should raise it for emphasis and his hand  gestures ate too routine. Dos he repeat himself? Like an echo chamber. Is he compulsive? Yup, yup. Does he look like a president? He has funny hair and too-long ties. Was he a sexual predator? If you take the Billy Bush tape literally, yes. Is he a narcissist and egomaniac? Yes. Has he paid his taxes over the years?  To me, this is up to the IRS to decide. Does he have most of the national media in his corner? Duh!

So why do I and millions of other Americans support this flawed man with clear eyes? Simple, because of his policies and because  his performance agrees with what we believe needs to be done. On immigration, on trade, on terrorism, on limiting government and government regulation, on national defense and hegonomy, on economic growth, on tax reform, on draining the political swamp that is Washington, on all these things and more ... most of which Democrats seem to eschew.

What's the difference between these two radically different stances? Clearly, Trump's opponents mostly dislike his superficials, whereas his supporters look beyond these flaws, believing that this man will MAGA.

BTW, Oprah has few of Trump's flaws ... but also supports few of his political mandates (at least those which we know now about), yet the Left already has her nominated for 2020. Is this the right political strategy? Well, it did work in 2008 ... but somehow I doubt it will again?

Headlines

Don't call Trump strategy a 'return to sanity' aide says

New report suggests Mueller probe could stretch far into 2018

Amid Mideast tensions, Pence again postpones trip ...

Sarah Palin's son Track arrested on domestic violence claims

Trump administration blames North Korea for global WannaCry cyberattack

Wasserman Schultz named one of Congress' most 'ethically challanged' for House IT scandal

Oldest fossils ever found show life on Earth began 3.5 billion years ago

WSJ: Tax cuts will grow economy much more than expected

ESPN president resigns, citing battle with substance abuse

Clapper: Putin is handling Trump like 'an asset'

ATL airport blackout sends message to terrorists ...

Limbaugh: Mueller to issue letter exonerating president?

Headlines

All from Internet news sites. Guess which from CNBC?

Longtime 'Today' host Matt Lauer fired from NBC after 'inappropriate sexual behavior'

Bitcoin surges through $11,000 less than 24 hours after topping $10,000

ESPN cuts another 159 employees ...

EU president: Without millions of African migrants Europe will be lost

Trump retweets violent Muslim videos from far-right U.K. figure

US third-quarter economic growth revised up to 3.3%

Moody's warns cities to face 'climate' risks or face downgrades ...

... 21 times exiting Rep. Luis Guiterrez touted open borders

[Former CFPB head] Cordray gets lukewarm homecoming

Amazon Cloud Services signs Disney, Expedia, NFL

GOLDMAN: Highest [stock] valuations since 1900; pan coming ...

[FCC chairman] ... slams Silicon Valley for censoring conservatives

Land Mines

Ex-President Obama left quite a number of land mines for his successor, Trump, to try to dance around:

- North Korea's missiles and atomic weaponry threats

- Iran on a clear path to nuclear weapons

- Poor economic and personal income growth

- Worldwide Jihadi terrorism

- China's South China Sea expansionism

- Immigration quagmire ... caused by lax enforcement

- Failed Muslim states: Libya, Somalia, Afghanistan,Yemen

- Hollowed-out U.S. national defense forces

- Over-regulation

- Poor relations with Israel

- Cybersecurity threats from around the world

- Unsustainable welfare/government transfer programs

- Incomplete ISIS and Syrian conflict resolutions

- Burdensome fiscal deficits and deadly national debt levels

- Huge international trade/balance of payments imbalances

- Obamacare in extremis

- Deteriorating race relations

- Crumbling national infrastructure

- National security and political leak torrents

- Increasing crime rates in many of our cities


But to Obama's credit, we were adored by most Western European leaders ... particularly due to his stance on global warming.

Afterward: There are only three reasons why Obama would have left all these problems for his follow-on ... indifference, incompetence ot by design. Historians will sort this all out, but my vote goes to the last choice.

Inflation

Inflation is a damnedable thing. It is both the devil and an angel simultaneously. It clearly damages the poor without a cushion of interest-earning  savings, the elders living on a fixed income and companies without pricing power. But it benefits those with large debts at a fixed rate of interest ... like mortgage holders and governments burdened with big debts with long maturities at relatively low rates.

Like today, a surfeit of money in the United States does not necessarily create inflation ... particularly if labor is not in short supply. Although it appears on the surface that we currently have a low unemployment rate, this number is misleading due to a very large number of those not looking for work. And the influx of H1-b immigrants also keeps high tech salary growth down. Therefore employment cost pressure is currently low. However, if President Trump can cause an economic boom for middle America and slow down H1-b immigration, there well could be a shortage of blue-collar and white-collar workers ... resulting real wage pressure ... and overall inflation well beyond the Federal Reserve Bank's goal of 2%.

Once this beast inflation is set loose, vicious feedback will kick in and it won't want to stop at 2%.

Add to this a trillion dollars of infrastructure spending certainly will increase our national debt and inflation. If Trump follows through with his pledge to lengthen the maturity of our national indebtedness, we might be able to inflate our way out of our current fiscal insanity ... like we did after World War II when we let inflation cure our huge debt burden,

So here are my current inflation predictions under Trump.... particularly if he serves two terms:

- Spend like mad on infrastructure, health care and rebuilding our military
- Extend the maturities of our then fast-growing national debt ..  maybe even longer than thirty years ... hopefully at relatively low rates
- Put pressure on the Fed to let inflation run ... possibly into the high single digits which will monetize this debt
- But still, longer term, try to bring government spending more in line with increased tax revenues generated by a booming economy

Is this all good? What other choices do we have?

Juggling Numbers

Is anyone surprised that our government has just announced ... 11 days before the elections ... that our economy grew much more vigorously ... at 2.9% in the third calender quarter of this year? This compares to roughly 1% growth in the first two quarters. This can easily be seen to be a cynical attempt to help Hellary in her bid for the presidency ... and to buff up Obummer's legacy. But I am again suspicious. Can not the federal number crunchers in Washington have stolen a smidgen of economic growth from each of the first two quarters of this year and dropped it into this quarter?

We are pretty sure that Obummer's Labor Department had previously juggled employment numbers for political purposes in 2012 right before his re-election ... so why not do it again ... but this time with the big Lubowski ... our whole economy?

On the breaking news that the FBI is reopening its investigation into the Hellary e-mail scandal, I suggest that Trump supporters not get too ahead of this story. The Clinton crime family is notoriously nefarious and I would not be surprised if other revelations come forth over the weekend that take two or three more turns in this affair. I am suspicious that there might be dramatic counter measures taken by the Clintonistas. The bacon might be in the fire ... but it is yet to be totally consumed by flame.

Headlines

.

These headlines are real ... they have all been discovered on Internet news sites:

Pakistani model killed [strangled by brother] after offending conservatives

Did Erdogan stage his own coup?

White House cuts economic growth forecast

Flashback Obama: 'If they bring a knife to a fight, we bring a gun'

Obama warns GOP: no inflammatory rhetoric

Remittances make up 2 percent of Mexico's GDP [equals about $23 billion]

Obama: Globalism will defeat terrorism

Iran conducts 4th missile test since signing nuke deal

Survey reveals that Germany's top companies employ just 54 refugees

U.S. navy banned from using sonar that could harm whales

Connecticut Gov: believing in two genders is 'genderism'

Judge: Instant jail time 'if you criticize migrants again'

Chinese Checkers

It seems that all is not lotus blossoms and shark-fin soup in China these days … as one respected analyst has estimated that the economic growth rate there fell to 1.7% in the fourth quarter of 2014 versus the official rate of 7.4% … see: Breitbart Article. And one reason to believe that China might be experiencing such a GNP paroxysm is that the world-wide demand for commodities … oil, copper, steel, etc. … has also fallen off the shelf. If China, one of the primary drivers of the growth in such commodities, has experienced such an indicated slowdown, then it would follow that its requirements for these materials would also plummet.

As indicated in this very interesting article referenced above, the side effects of this economic slowdown in China is that it is exporting deflation and is beset by capital and labor outflows which put its large internal debt burden in a precarious position. China’s ability to manage its way through its current economic problems is far more consequential to world economic health than today’s political theater in Greece. As indicated, if China is forced to sell much of the $1.3 trillion of United States sovereign debt it now holds, interest rates here will naturally elevate … independent of the machinations of the U.S. Federal Reserve Bank. This would also strengthen the dollar more which, in turn, would then depress commodity prices even further.

It appears to this investor that the key to continued strength in world economies and stock markets is now held in Beijing and not in Washington and Brussels … or even in Riyadh,Saudi Arabia.