This week I was reminded of one of my favorite sayings, A good business deal is one where everyone walks out smiling; a good political deal is one where no one walks out smiling.
I have read and heard many descriptions of this past week’s market action as representing a “Perfect Storm,” which is probably a reference to the very intense movie by the same name in the year 2000. During the week, we saw the FED raise interest rates, Facebook get caught not properly protecting personal information, and President Trump implementing tariffs on some imports.
Unlike the crowd, I believe this week to be a colossal “Imperfect Storm.” Why? Because there was a political deal in which at least one side came out smiling. When Democrats smile and jump in front of cameras to claim victory, hang on to your wallets! Better yet, tell your children and grandchildren to hang on to theirs. This one is a doozie.
Herbert Stein (Ben’s father) was the formulator of “Stein’s Law,” which stated that, “If something cannot go on forever, it will stop.” Borrowing a Trillion Dollars a year is unsustainable. Do the math – the implications are not good for America.
In a world searching for sustainability, we are being led by elected officials who seemingly cannot comprehend the unsustainability of gigantic annual deficits and the resultant mountain of debt. Perhaps worse yet, I believe that Congressional leaders are not interested in supporting the President and his agenda. What happened to the promises made by Trump and elected Republicans in 2016? The public expressed their enthusiasm, but no one, it appears, was listening.
We must return to doing the will of the people, support the Trump agenda, and restore some fiscal sanity in this country. Your livelihood depends on it, both before and during retirement. In the words of then-candidate Donald Trump, “What do you have to lose?”
As has happened too often in recent decades, the Republican majority in both Houses of Congress, coupled with a Republican President, has imploded. Seemingly incapable of leadership, they will likely be relegated to minority status by uninspired voters come November. Party suicide by leadership. And a sad day for America, as it will most likely hasten the bankruptcy of America.
Investors should take heart that with all the new money being spent, coupled with tax rates being reduced, profits in the coming quarter should drive the market higher. Since we are unable to control the politics, let’s hope we all benefit through our investments. Make hay while the sun shines.
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