On the Brink

I think financial journalists and fashion writers are the same people. The S&P 500 appear to be tottering on the brink of an abyss, and the financial press is full of stories about “Five Surprising Stocks to Buy Now!” written with the same breathless optimism as articles promoting fashion — “Five Makeup Essentials to Make You Look Ten Years Younger!” “Dress Like a Star With Glitter, Bedsheets and Safety Pins!” Whatever.

The more serious stock market people are alarmed that they are getting mixed messages from the White House. Larry Kudlow says one thing; Peter Navarro, who seems to have ten different jobs, says another.

Kudlow told CNBC on Friday that the trade talks with China are “extremely promising.”

Kudlow, director of Trump’s National Economic Council, said that Trump has indicated he might be willing to extend the 90-day negotiating window if there’s “good, solid movement and good action.”

Navarro, the trade hawk of the White House, struck a different tone on CNN. Asked whether the administration would walk away if issues with China are not resolved within 90 days, Navarro suggested Trump would “simply raise” existing tariffs on $200 billion worth of Chinese goods.

If China fails to change its ways on trade, “we have a president that’s going to stand up to that for once,” Navarro said.

Navarro also championed the nearly $12 billion that the United States has raised from tariffs, even though that money is being mostly paid by American consumers and businesses.

Of course, the real problem is that there’s nobody at the helm. Well, there’s Trump, but he has no idea what he’s doing. Paul Krugman writes,

Unfortunately, he really, really doesn’t know what he’s doing. On trade, he’s a rebel without a clue.

Even as he declared himself Tariff Man, Trump revealed that he doesn’t understand how tariffs work. No, they aren’t taxes on foreigners, they’re taxes on our own consumers.

When trying to make deals, he seems to care only about whether he can claim a “win,” not about substance. He has been touting the “U.S. Mexico Canada Trade Agreement” as a repudiation of NAFTA, when it’s actually just a fairly minor modification. (Nancy Pelosi calls it “the trade agreement formerly known as Prince.”)

Most important, his inability to do international diplomacy, which we’ve seen on many fronts, carries over to trade talks. Remember, he claimed to have “solved” the North Korean nuclear crisis, but Kim Jong-un is still expanding his ballistic missile capacity. Well, last weekend he claimed to have reached a major trade understanding with China; but as J.P. Morgan soon reported in a note to its clients, his claims “seem if not completely fabricated then grossly exaggerated.”

Markets plunged earlier this week as investors realized that they’d been had.

Of course, allowing oneself to be “had” by the likes of Trump suggests one wasn’t too smart to begin with. Michelle Obama said recently that the Masters of the Universe types really aren’t all that smart, and I believe her.

Elsewhere: Rex Tillerson made some candid remarks about his time in the Trump Administration recently. Naturally The Creature had to weigh in.

The above is a genuine tweet by the allegedly adult POTUS. I pulled it off his Twitter page personally.

Forbes has an in-depth look at How Donald Trump Shifted $1.1M Of Campaign-Donor Money Into His Business.

The appointee to become U.S. ambassador to the United Nations is a former Fox News reader who not that long ago cited D-Day as a high point in U.S.-German relations.

Update: Neil Irwin of the New York Times notes stock market volatility and wonders why it took so long for the money people to get nervous.

First, why is this happening when the economy is so strong? TheNovember jobs numbers released Friday showed the unemployment rate remains at a rock-bottom 3.7 percent amid healthy job creation, just the latest piece of economic data to come in relatively strong.

Second, what took so long? Why are markets just now recognizing the risks the economy faces in 2019, which have been obvious for months to anyone paying attention?

My answer is that most of these people don’t want to face the obvious. They want to believe everything will be fine.

15 thoughts on “On the Brink

  1. The Dow tanked nearly 1000 points for the week. Jobs numbers are good, but profits for a lot of major companies are not so hot, especially if you take out the tax gift. GM is cutting back thousands of jobs and the ripple effect will be even bigger. These disappearing jobs are the high-end manufacturing jobs Trump promised. They're leaving the Rust Belt that Trump carried. Wages are flat overall and consumers have noticed that the sugar high of the tax cuts only sweetened life for folks at the top.

  2. JAYZOOOOOOOOOS H. KEEEEEEEEEEEEERIST under oath, uttering several oath's!!!!!

    The Southern District of NY just basically said in its Cohen submission to the judge, that tRUMP directly directed his butt-boy to use campaign money to pay Stormy and other women he tried to buy-off (Sunny? Windy?  Cloudy? Bambi? Sleepy? Dopey?  Doc?).


  3. why it took so long for the money people to get nervous.

    The short answer is that the good years of Obama economic policies coupled with the tax cut stimulus are about to run out. There won’t be anything to buffer Tariff-Man and his gang of morons.

    See UCLA Forecasters Say the US Economy will Downshift in 2019, 2020:

    The United States is “playing with fire” in launching a trade war with China and its economic growth will plummet over the next two years as the stimulus of tax cuts and spending increases wanes and interest rates rise, according to a new forecast from the UCLA Anderson School of Management…

  4. The "Cohen Papers" go much beyond just women!



    "Political synergy.".

    Remember that term.  Look for when you read or watch about today's Cohen v. tRUMP match. *

    I never knew that "political synergy" was Russian for, "Vee vill give you rubles, and do ANY THING to help out our dearski boychick, Donald teeROMP beat that bitchski, Heellary!!!"

    *  I'm enjoying watching MSNBC too much tonight to go into greater details.  Sorry…



  5. “My answer is that most of these people don’t want to face the obvious. They want to believe everything will be fine.”

    Yes, everything will be fine, for them.  It’s the rest of us who’ll feel the pain, and they want to keep us in the dark as long as possible, by pretending everything’s fine, to keep us at bay.  It’s worked before.

  6. csm,

    It's not US they want 'to keep in the dark… to keep US at bay.'

    It's tRUMP's own deplorable Lumpenproletariat that they have to keep in the dark to keep THEM at bay!

    If the MAGA crowd starts to see that their Wizard of Ooze – who they believe can perform economic miracles, take us back to pre CRA's & VRA's days, all while pissing-off the Libtards – is nothing but a bigoted bumbling old orange grifter who couldn't find his zipper even if he had a GPS, they will go back under the rocks they crawled out from, and abandon tRUMP!

    And then who will be left to vote for the GOP in 2020? 2022? 2024? 2026, etc…?

  7. uncledad, 


    Sadly, I couldn't find a middle-finger one to flash at tRUMP…

  8. The  oval office orangutan took a big hit today.. ( insert dancing bananas here) And Michael Cohen got a recommendation for concurrency for being a rat fink in linking Trump and the crime family firmly to Russia. Concurrency is to prison time what double time is to a member of the United Auto Workers union. The type of thing that you're always eager to grab when it comes around.

     I'm beginning to think that Trump is going to use an insanity defense when he gets busted. He tweeted in response to the news of Cohen's sentencing memo…"totally vindicated no collusion"

  9. Shame on the Washington Post. Contrary to their headline, Heather Nauert did not cite D-Day as the height of U.S.-German relations. I listened again to make sure. Worse, in their reporting in the third paragraph, the Post broke up the Nauert quote so that she appeared to say something that she did not. (True, she may have been clueless about D-Day, but you can't tell that from what she said.)

    The third paragraph:

    “When you talk about Germany, we have a very strong relationship with the government of Germany,” Heather Nauert, the State Department’s spokeswoman, said in June. She added: “Tomorrow is the anniversary of the D-Day invasion. We obviously have a very long history with the government of Germany, and we have a strong relationship with the government.” She also pointed to the Marshall Plan, which rebuilt Western Europe in the ashes of Adolf Hitler’s quest for global domination.”

    The Post reported Nauert's remarks as though she immediately gave D-Day as an example of our strong relationship with "the government of Germany." What she actually said next was this: "Looking back in the history books, today is the 71st anniversary of the speech that announced the Marshall Plan." Yes, as the Post says, the Marshall Plan rebuilt Western Europe. But it stood in stark contrast with the punitive treatment of Germany after World War I. Now, following the Marshall Plan with D-Day is jarring, but putting the Marshall Plan after D-Day misrepresents what she said, and is bad reporting.

    Furthermore, contrary to the Post's reporting, Nauert did not call either of them "the height of U.S. German relations." There are better examples of that, such as the Berlin airlift, or Kennedy's speech in which he said, "Ich bin ein Berliner," or Reagan's speech in which he said, "Mr. Gorbuchev, tear down this wall," or the actual fall of the Berlin wall. Note the ambiguity, because of the division of Germany until reunification. We may have a strong relationship with Germany, but it has been, and still is, an ambiguous relationship. 

    Not that Nauert strikes me as a deep thinker about international relations, nor does whoever in the State Department wrote her remarks, but the Post did a hatchet job.


  10. So Trump says "Totally clears the President. Thank you! ". After Mueller's and the SDNY sentencing memo's were published. I wonder does Trump think the memo's are Mueller's final report? Anyway he says he's "Totally Cleared" so lets all just move on! Also saw this somewhere: "If Trump really wanted to "lock her up" he should have hired Hillary to work on his campaign!


  11. We're ready for a few days snowed it here in NC, so the next two or three days will be sitting around the fire with mulled wine rather than "screen time."

    The link that first caught my eye was Michelle Obama's "they're not that smart."  It turned out to be slightly different than I expected, but, it ran parallel to what has struck more pedestrian minds like mine.

    The more we see of "the best people," the more evident it becomes that they are indeed, not very smart.   One of our cultural foibles has been that we tend to equate wealth and power with intellect and other virtues.  This blindspot has been stoked and exploited by  adherents of the "Prosperity Gospel" and a constellation of other right wing assertions, that have paved the way to a corporatist state.  The Trumpsters have assimilated this set of concepts and is basically on auto pilot, so I don't expect them to wake up anytime soon, if ever.

    But, as jaundiced as my view of the rich and powerful was, as much as I felt that the system was rigged, I find myself continually astonished by the sheer incompetence and lack of insight of the "best people."  (This, leaving out the staggering corruption of this same crew, which is another side of the same coin.)  In a more just world, they would be the gang that couldn't shoot straight, but, unfortunately, in the world as it is, their moment has come. 


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