When I returned home from taking our granddaughter to Maitland and turned on my desk top it blew..I just got a new computer and this is why I have been out of touch for several days. Thank goodness all my data was saved but I am now having to learn Windows 11 format.
This memo was typed before I left.
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Don't tell me something good happened and Americans are finding jobs and getting wage increases?
The Democrat shtick was the tax cut was designed to only help the rich .(See 1 below.)
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Kim suggests when it comes to financial manipulation, Pocahontas is a straight arrow which she has aimed at her opposition. (See 2 below.)
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It is fascinating how anti-Trump Haters are able to pin the anti-Semitism tail on him when, in fact, Democrats and their progressive radical friends have had a far greater relationship with the worst snake of all - the nation of Islam's Farrakhan.
Obama, our slippery eel president, was always good at accusing his antagonists with what he was actually doing and never got his hand called by the mass media. Hillary also is a sleight of hand magician at the same game.
Radical members of The Democrat Party have immersed themselves for years in playing footsie while denying it and accusing others of what they were doing. (See 3 below.)
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I was mocked when I warned Sharia Law would be coming to America. Only a matter of time.
Well folks it is silently worming into New York City - The Big Apple. (See 4 below.)
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The editorial page of newspapers and media generally reflects the views of their owners and attracts a readership that tends to agree. Ted Turner's liberal views still course through the veins of CNN, long after his connection has been severed. Bertie McCormick's Chicago paper was his philosophical play toy and The New York Times's editorial attitude towards Israel reflects the owner's difficulties with having been born Jewish and coming to grips with that threatening fact. The two founding families have basically become Protestants so they can rid themselves of their Jewish connection but then someone like Melanie Philips (see previous memo) comes along and reminds them of this disturbing reality. Now a former editor has written a book exposing them once again.
The Wall Street Journal, I am told, is now run by the more liberal son of the senior Murdock.
Objectivity has always been the question. In my opinion, we have come full circle and the media's role of ombudsman is neither evident nor an effort at pretense any longer attempted.That is both sad and dangerous because the "unwashed" public's views are still impacted and shaped by reporting and ideas of the mass media organs though less and less so because of their one sided reporting and the invasive impact of social media technology.
Later in the year, I am working on bringing a young female op ed writer for The Washington Examiner to town. I plan to host several meetings for her and she will be discussing her book .
I consider her the female equivalent of Jack Germond, a great op ed writer for The Baltimore Sun and a good friend.
Unlike many of her peers, she correctly predicted Trump's victory because she does not live in a cocoon but gets out among the "unwashed" and does what a good investigative political reporter is supposed to do. She listens to those who count, ie. the "deplorables" who drink beer at bars, go to work, have values that align with the American Character etc.
You will be hearing more from me regarding Selena Zito.
Meanwhile, on Feb 18 at The Plantation Club at The Landings, David Bossie and Corey Lewandowski will be the guest speakers at the SIR's PDD . More information about this event will be forthcoming . I urge you to place this date on your calendar.
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An initial Rant to start the New Year. (See 5 below.)
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Ocasio- Cortez and her like minded radicals are being assisted in having a major impact on shaping the direction of The Democrat Party.
They are the product of what urban living and our education system is producing as well as the fact that Obama laid the foundation for more radicalism and it only took him 8 years. This shows how fragile a foundation our republic rests upon.
This new crop of "know nothings" are driven by their desire to help the underdog at the expense of bringing the entire nation to its feet. They are both bleeders and blood suckers politically speaking.
Obama told us he would transform America and did so into a nation that was not what the Founding Father's necessarily intended it to be. As for Trump, he too is trying to change our nation's direction back into what it was intended to be. What made America great and distinct was the character of its people, their willingness to be self reliant, generous when the need called and a desire to live in freedom while adhering to laws which were god given. We also were founded on a premise that every citizen could pray to their own God and that government served we the people.
Tragically the success we have achieved allowed us to drift away from the constitutional strictures crafted by our Founding Fathers and we now find ourselves afloat in higher seas and taking on water. If we continue to embrace the message of the radicals, who seek chaos and discord, we will sink along with all other nations who lost their way because they became strong and powerful and subsequently rootless.
Once again, the mass media will give radicals, like Ocasio, an unearned presence because their persona and views are controversial and therefore, bring in substantial media revenue. Folks, the goals of our mass media have become entirely driven by entertainers and hypocrite trend setters.
Furthermore, these radicals are an angry lot. They seek to right the ills and wrongs of our society and they intend to do so by altering the rule of law and other precepts that have served our nation well.They intend to foment discord by pitting Americans against each other, stir the pot of racial tensions and economic disparity. Since many in the mass media are in agreement and constantly find fault with everything America they have become the supporting grease that has been used to get our nation off track.
The best hope is that the message of these "know nothing" radicals will fade before they do too much damage but one can never hope this will happen in and of itself. Once again I remind my readers, the enemy is us! (See 6 below.)
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Dick
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1)
Jobs for the Forgotten Man
Wage increases are reaching even unskilled corners of the labor force.
The Editorial Board
Americans needed some reassuring economic news, and on Friday they received a double dose: First, a blowout jobs report for December, followed by a tacit admission by Chairman Jerome Powell that he had messed up at his December press conference by suggesting the Federal Reserve is on “auto-pilot” on its tightening course.
Markets reacted with a big vote of confidence, sending the Dow Jones average up 3.3% and the Nasdaq 4.3%. The equity rally roared right past continuing political rancor in Washington over a partial government shutdown that may not end soon—a sign that policy gridlock wouldn’t be the worst outcome over the next two years.
The labor report could hardly have been better, with employers creating 312,000 new jobs in the
last month of 2018, plus an upward revision of 58,000 for October and November. The
unemployment rate rose to 3.9% from 3.7%, but that was also good news as 419,000 workers
joined the labor force. Many haven’t yet found work, but the flood of job seekers suggests the
U.S. still isn’t at full employment.
last month of 2018, plus an upward revision of 58,000 for October and November. The
unemployment rate rose to 3.9% from 3.7%, but that was also good news as 419,000 workers
joined the labor force. Many haven’t yet found work, but the flood of job seekers suggests the
U.S. still isn’t at full employment.
They’re being drawn by more openings and rising pay. One intriguing note is that the number of job leavers rose in the month by 142,000 to 839,000. This reflects workers’ confidence that they can find a better job at better pay in what is the best U.S. labor market since the middle of the last decade.
We’d note in particular that manufacturers added 32,000 jobs in December, for an increase of 2.3% for 2018. That’s impressive for an expansion now into its ninth year, and it shows the benefit of the new capital investment spurred by tax reform and deregulation. Manufacturing employment fell by 210,000 during Barack Obama’s two terms. It has risen by 473,000 jobs in Donald Trump’s first two years.
Employers are also paying more as average hourly earnings rose again and are now up 3.2% in the last year. That’s the fastest rate since before the financial panic and it looks set to continue as businesses compete to hire and retain the best workers.
The trend is spreading even to traditionally lower-paid corners of the economy. Wages in retail trades are up 4.6% for the year and 5.5% for the last three months. Leisure and hospitality wages for production-level workers rose 4.3% for the year and 5.1% in the last quarter. If this keeps up, Senator Elizabeth Warren will have to retool her 2020 campaign message that the middle class is vanishing.
Amid this good news, the worry is that the labor market is a lagging economic indicator. The December report suggests considerable underlying economic strength, but recent evidence shows signs of softening in manufacturing, tightening credit markets, and declines in consumer and business confidence. The declines in the stock market and bond yields have also raised fears of slowing growth.
Which brings us to Mr. Powell, who sent stocks soaring with comments Friday that the Fed isn’t on a “pre-set” course to keep raising interest rates in 2019. “With the muted inflation readings that we’ve seen coming in, we will be patient as we watch to see how the economy evolves,” Mr. Powell told a conference in Atlanta. Hear, hear.
That’s about as close a central banker will come to acknowledging that the Fed made a mistake in raising rates again in December amid credit-market cracks, a strong dollar, falling bond yields and commodity prices, and no signs of inflation. Mr. Powell had seemed almost cavalier at his press conference about rate increases and the steady decline in the Fed’s balance sheet. On Friday he showed more caution about the pace of this combo-tightening maneuver that no central bank has executed before.
The Fed would repeat its December error if it considers the strong job report as vindication and returns to rote tightening. Rising wages aren’t inflationary if they reflect gains in labor productivity, which surged in 2018. The flow of new workers into the labor force also suggests room to grow faster even with a jobless rate at a historically low 3.9%. The labor participation rate is up 0.4 percentage points to 63.1% in the last year, but a surge of younger people of working age means that rate has room to rise.
All of this suggests the U.S. economy is poised to keep growing in 2019, despite slower growth around the world. The Fed aside, the key policy variable is trade. Businesses are waiting on investments as they see how Mr. Trump’s multi-front tariff spree plays out. If the President strikes a deal with China, removes his car-tariff threat, and doesn’t blow up Nafta, the uncertainty would ebb and good times could continue to roll.
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2) Elizabeth Warren’s Money
Game
Game
She collects cash, then demands her opponents disavow the methods she used.
By Kimberley A. Strassel
Sen. Elizabeth Warren built a political career on her reputation as a financial expert. Her prospective presidential opponents are learning how savvy she is, at least when it comes to campaign cash.
Political observers spent this week wondering why the Massachusetts senator rushed to become the first major Democrat to announce for 2020. She made her strategy clear in a Wednesday-night interview with MSNBC’s Rachel Maddow. “This is going to be the fish-or-cut-bait year for the Democrats,” said Ms. Warren, in what was clearly a well-rehearsed declaration. “This is a moment for all of the Democratic nominees . . . to say: In a Democratic primary, we are going to link arms, and we’re going to say ‘grass-roots funding.’ No to the billionaires. No to the billionaires—whether they are self-funding, or whether they are funding PACs. We are the Democratic Party, and that’s the party of the people.”
This may sound laudable, and in keeping with Ms. Warren’s antipathy for plutocrats. It’s also in line with the progressive animus toward “big money,” intensified in 2016 by the Bernie Sanders campaign. All of which masks how useful this approach is to Ms. Warren as she tries to ward off or financially destroy her competition. Not for the first time, she is positioning herself as a campaign-finance purist, even as she attempts to fix the money rules to her advantage.
The immediate goal of planting this new campaign-finance yardstick is to put her competitors in a bind and potentially even dissuade some from running. Her jab at “self-funding” was a clear shot at billionaires Tom Steyer and Michael Bloomberg, both of whom are visiting primary states. Ms. Warren wants them to know that she will mobilize her progressive base to oppose them on principle.
But it was equally a warning to any well-connected contenders that she will hold them to a no-super-PAC standard. Such political-action committees—technically separate from campaigns, yet run by trusted advisers—are free to raise unlimited sums and are beloved even by Democrats who claim to hate “big money.” Barack Obama embraced them. Hillary Clinton’s 2016 super PAC raised tens of millions.
And there is no question that the likes of Sens. Cory Booker, Kamala Harris and Kirsten Gillibrand are planning to use their networks of Wall Street bankers and Silicon Valley entrepreneurs to help float their primary runs. Ms. Warren intends to make any seven-figure check a political liability. She’s practically daring “Middle Class Joe” Biden to raise a few Delaware banking dollars—and face the backlash.
Such money strictures would suit Ms. Warren, since she already has a bankroll—thanks to a different kind of fundraising operation she set up in 2017, at the beginning of her Senate re-election race. As a candidate, Ms. Warren is limited in the amount anyone can donate to her. But the Elizabeth Warren Action Fund is a joint fundraising vehicle with the Massachusetts Democratic State Committee and her own PAC. That allows wealthy admirers to write six-figure checks. Plenty did, including bankers and tort lawyers. According to campaign-finance records, Ms. Warren’s fund raised $4.9 million during the 2018 cycle and transferred the vast majority of it to her official Senate campaign.
Ms. Warren overall hauled in $25 million for that Senate race, despite facing little competition. This left her $12.5 million, which the law conveniently allows her to transfer to her presidential primary campaign. And this week her office quietly (and conveniently) announced it was dismantling that joint fundraising vehicle, since good progressives don’t engage in such money grubbing. Ms. Warren’s competitors can expect to be held to this additional standard, which Ms. Warren didn’t impose on herself retroactively.
None of this will surprise GOP operatives, who remember a similar Warren gambit in her 2012 race against incumbent Republican Scott Brown. That featured her vaunted “People’s Pledge,” in which both candidates agreed to fork over a financial penalty if any outside super PACs ran TV or internet ads on their behalf. Notably, the pledge didn’t come until outside liberal groups had seriously roughed up Mr. Brown. Ms. Warren remained the beneficiary of hundreds of thousands of dollars of outside spending, as her union and environmental allies redirected the money into their well-oiled get-out-the-vote efforts. The pledge didn’t curb outside money; it merely made it work to Ms. Warren’s benefit.
Her war chest filled, the senator can now turn her attention to grass-roots fundraising—which she is also good at. Her goal is to rack up some big early numbers that will scare other competitors out of the race, especially as they wrestle with Ms. Warren’s new litmus test on outside spending. Oh, yes—Ms. Warren knows a great deal about finance.
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3) The Nation of Islam and the
House
House
Democratic leadership members have a history with Louis Farrakhan.
By Jeryl Bier
• James Clyburn of South Carolina. Mr. Clyburn, first elected in 1992, will hold the No. 3 post, majority whip, as he did in 2007-11. Mr. Clyburn is also a member of the Congressional Black Caucus, which in September 1993 entered what then-CBC Chairman Kweisi Mfume called a sacred covenant” with the Nation of Islam. The pact was ostensibly dissolved in February 1994, after it emerged that Farrakhan aide Khalid Abdul Muhammad had given a speech in which he called Jews the “bloodsuckers of the black nation.” But in July 2000, Mr. Clyburn, then CBC chairman, formed a partnership with Mr. Farrakhan’s Million Family March.
In 2005 Mr. Clyburn became chairman of the Democratic Caucus. The same year, photojournalist Askia Muhammad reported that “practically all 43 CBC members” (including then-Sen. Barack Obama) met Mr. Farrakhan in preparation for the 10th anniversary of the Million Man March. In 2011 Mr. Clyburn again joined Mr. Farrakhan, for a town-hall gathering in Pittsburgh titled “The Disappearing Black Community.” Mr. Clyburn told the Final Call, the Nation of Islam’s newspaper, that he was “not bothered in the least bit” by criticism of the appearance.
• Barbara Lee of California. New York’s Rep. Hakeem Jeffries narrowly defeated Ms. Lee to become chairman of the Democratic Caucus, the No. 4 leadership position. Mrs. Pelosi then named Ms. Lee a co-chairman of the Democratic Steering and Policy Committee. Ms. Lee was at the 2005 CBC meeting with Farrakhan, where she posed for a group photo. In January 2006, she and other CBC members met privately with Mr. Farrakhan in New Orleans. A video shows Ms. Lee embracing Mr. Farrakhan, who calls her “my sister.” Not until March 2018 did Ms. Lee say: “I unequivocally condemn Minister Farrakhan’s anti-Semitic and hateful comments.”
• Maxine Waters of California. The new chairman of the Financial Services Committee was also a member of the CBC delegation that met Mr. Farrakhan in 1993 and announced the “sacred covenant.” Ms. Waters appeared at 1997’s Million Women March and attended Mr. Farrakhan’s February 2002 Savior’s Day address, in which he expressed sympathy for Palestinian suicide bombers.
In July 2002, Ms. Waters attended a Farrakhan briefing to the CBC on his “peace mission,” which included a stop in Iraq. Ms. Waters appeared in the 2005 group photo with Mr. Farrakhan and was in New Orleans in 2006, where she told Mr. Farrakhan she’d like to meet with him to plan a strategy for getting post-Katrina New Orleans on the national agenda. (Ms. Waters’s office has declined to say whether such a meeting took place.)
“The difference between Farrakhan and some members of the alt-reich whose heinous bigotry has received a lot of attention this past year,” CNN’s Jake Tapper tweeted last February, is that “Farrakhan has a much larger following and elected officials meet with him openly.” Another difference is that with a few exceptions such as Mr. Tapper, the media don’t seem to care.
Mr. Bier is an accountant and freelance writer.
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4)
A friend recently sent me a photograph of a Muslim Security Patrol car in New York City asking me if it was real — and it was. As a New Yorker, I was shocked.
The issue with a Muslim patrol unit is that Islam comes with its own system of Sharia law. If there are feminists in New York, they should be concerned.
4)
“Muslim Community Patrol” spotted in New York City
MARTINA MARKOTAREBEL CONTRIBUTOR
A friend recently sent me a photograph of a Muslim Security Patrol car in New York City asking me if it was real — and it was. As a New Yorker, I was shocked.
The issue with a Muslim patrol unit is that Islam comes with its own system of Sharia law. If there are feminists in New York, they should be concerned.
Many European cities already have Islamic police units, like Vienna, where a father was beaten by Sharia patrol while trying to protect his daughter and wife. And London, where Sharia patrol forced a couple to stop holding hands because they were in a "Muslim area".
They have their own laws and are very serious about enforcing them if you come into their territory.
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5)A new year, and a disaster in DC. I hope all of you who voted for the Dems in the midterms like the ideas being pushed now in the House for: no limits on spending, free education, healthcare for everyone exactly like the British system that fails to provide timely care, a guaranteed income for everyone even though the several nations that tried this ended it in failure, the end of fossil fuels entirely. Ending fossil fuels means every building in America has to change its heating system and buy solar panels, or pay a far higher utility bill so the utilities can pay for converting to unknown fuels and the end of fossil fuel for power plants, everyone has to turn in their car and buy a new electric powered one, and use new lubricants not yet invented. Oh, and then there are the tens of millions unemployed as oil companies, utilities, auto companies and all the associated product and service companies related to oil and gas go out of business. All of this is to be paid for in some way the left has admitted it has not figured out, other than to raise taxes to 70% on top earners. No problem, we will have open borders and let in all the uneducated and drugs and make it all better. The uneducated migrants will now be the ones to start companies and create jobs. The result of all this would be Venezuela. The country would collapse. But does the left even bother to find a way to pay for all this, do they ever look at the failed experiments in other countries that tried these things-no. Why study history. It just gets in the way. The good news is none of this can become law, but there will be millions of voters who think this all sounds great-I get everything for free and I pay no taxes. I can sit home and do drugs while the government guarantees me a living. Wow. How great is all that. And now on day one they introduce two bills to change the electoral processes in the constitution and a myriad of other things. The people on the far left, and those who vote for them are uneducated fools who have no grasp of reality on earth, and zero understanding of history, nor of the long string of failures of socialism. This is why I was so far wrong about the outcome of the midterms. It was inconceivable to me that anyone with an education would vote Democratic given that the economy under Republicans did an amazing turn around, minorities and low income workers have the lowest unemployment in history, the nation is far safer, real efforts are being made to deal with opioids, there may be a real deal with China, nations around the world now realize we are rebuilding our military and once again can win a war, N Korea has stopped the tests and threats for now, taxes are now competitive with the rest of the world, border security is being dealt with, Iranian expansion is being stopped, the stock market has made a huge swing up making 401K values much higher, wages are moving up for the first time in over 10 years, and the anti-cop rhetoric has ended. What is it that those college educated white suburban women do not understand. I chalk it up to the far left wing rhetoric they are taught these days on campus. They no longer think. They never take a history class. History has been eliminated as a core course on most campuses. All they know is a lot of left wing ideology now taught in universities. If you think that is a right wing political statement, go dig into what is really happening on campus today as I have. You will be really upset.
5)A new year, and a disaster in DC. I hope all of you who voted for the Dems in the midterms like the ideas being pushed now in the House for: no limits on spending, free education, healthcare for everyone exactly like the British system that fails to provide timely care, a guaranteed income for everyone even though the several nations that tried this ended it in failure, the end of fossil fuels entirely. Ending fossil fuels means every building in America has to change its heating system and buy solar panels, or pay a far higher utility bill so the utilities can pay for converting to unknown fuels and the end of fossil fuel for power plants, everyone has to turn in their car and buy a new electric powered one, and use new lubricants not yet invented. Oh, and then there are the tens of millions unemployed as oil companies, utilities, auto companies and all the associated product and service companies related to oil and gas go out of business. All of this is to be paid for in some way the left has admitted it has not figured out, other than to raise taxes to 70% on top earners. No problem, we will have open borders and let in all the uneducated and drugs and make it all better. The uneducated migrants will now be the ones to start companies and create jobs. The result of all this would be Venezuela. The country would collapse. But does the left even bother to find a way to pay for all this, do they ever look at the failed experiments in other countries that tried these things-no. Why study history. It just gets in the way. The good news is none of this can become law, but there will be millions of voters who think this all sounds great-I get everything for free and I pay no taxes. I can sit home and do drugs while the government guarantees me a living. Wow. How great is all that. And now on day one they introduce two bills to change the electoral processes in the constitution and a myriad of other things. The people on the far left, and those who vote for them are uneducated fools who have no grasp of reality on earth, and zero understanding of history, nor of the long string of failures of socialism. This is why I was so far wrong about the outcome of the midterms. It was inconceivable to me that anyone with an education would vote Democratic given that the economy under Republicans did an amazing turn around, minorities and low income workers have the lowest unemployment in history, the nation is far safer, real efforts are being made to deal with opioids, there may be a real deal with China, nations around the world now realize we are rebuilding our military and once again can win a war, N Korea has stopped the tests and threats for now, taxes are now competitive with the rest of the world, border security is being dealt with, Iranian expansion is being stopped, the stock market has made a huge swing up making 401K values much higher, wages are moving up for the first time in over 10 years, and the anti-cop rhetoric has ended. What is it that those college educated white suburban women do not understand. I chalk it up to the far left wing rhetoric they are taught these days on campus. They no longer think. They never take a history class. History has been eliminated as a core course on most campuses. All they know is a lot of left wing ideology now taught in universities. If you think that is a right wing political statement, go dig into what is really happening on campus today as I have. You will be really upset.
The Dems are going to way overplay their hand and just be total obstructionists, and that will backfire just as the impeachment of Clinton did. As long as the US economy remains growing, and unemployment remains at near historic lows, Trump will hold a winning hand. The shutdown will play to Trump’s favor as he continues to say he will compromise, but the Dems refuse to talk, and reject the data from the border as to what is really happening. So long as the caravans are sitting in Mexico, ands drugs pour in, the need for border security just becomes more apparent. The Senate will install several dozen new judges which will change the game of lawsuits that now try to stop Trump. The press will ramp up their attacks on Trump and support the far left as they are already doing putting the kid from Queens on the nightly news and 60 Minutes to spew her far left unrealistic and uneducated ideas about unlimited spending, free everything, huge tax increases, and impeachment, and now we have a Muslim Congresswoman who uses obscene language about Trump. This is the Democrat party of today. Welcome to the wonders of diversity. Nothing useful will get done, and eventually voters will realize the country is going nowhere due to the resistance, and socialistic policy bills being introduced by the Dems. Today statements by Chuckie and Nancy that Trump needs to reopen the government and spend the next 2 months negotiating the border is political nonsense. Nothing is going to be any different in 2 months. There is no reason it cannot be dealt with now, instead of stupid political games of delay and blame. Trump has backed them into a corner. Now they have to be against border security, or go along with Trump. Trump should have a press conference and play tapes of Schumer, Obama and Pelosi supporting border security and voting for fences and walls. This is ridiculous. Trump wins this one if it goes much longer since we all know the border needs to be secured. Note that Trump stopped calling it a wall and now says border security, a barrier, and steel. He has made it a national security issue, not a wall.
So where does this leave the economy. Hard to say. The employment numbers for December were spectacular. The fact that the numbers were so much better than forecast should tell you what I have been saying about Wall St analysts. They often are very wrong, and all the talk of pending recession is wrong. Wages are rising at 3.2%. Better than in decades. Family cash income due to wage growth and cheap gas, is finally growing strongly on a consistent basis. Powell said all the right things this week. Auto sales in 2018 were good, and equal to 2017. Home rental companies are now building new homes to rent. Further to my theory that it may not be a decline of new home sales that is happening , but instead it might be that millennials prefer to, or are forced to rent. We may be experiencing a culture change, not an economic downturn in housing. Too early to know. However, it is not encouraging to corporations to invest if there is this kind of political disgusting behavior by the Dems, and all the loose talk about a recession in 2019, tax increases, and impeachment, and all out resistance. We can talk ourselves into a slowdown, and the press and kids in Wall St with their algo trading can cause extreme volatility in the markets. It should be noted that several of the big names in hedge funds had a terrible year in 2018, losing far more than the market indexes. Hedge funds have been major under performers and losers for years. If you owned a portfolio of good solid US stocks last year, you beat the hedge funds. The more talk of recession is promoted, the more companies are reluctant to invest and hire. The more talk of impeachment and wild spending, and much higher taxes, the more companies will be reluctant to invest. A lot will depend on the China talks next week and GDP reports. The good news is the ten year is at 2.6% and possibly going lower. Oil is in the forties, and keeping consumers having more cash to spend and save, and factory production costs lower. Slow economies across the world, and the continued strong dollar, means import prices will stay lower than otherwise would happen if these economies were booming. This means lower inflation. That means rates stay low and the Fed is more likely to suspend the next raise. That results in investments using leverage yield better returns and make investing in capital projects more appealing. It also means corporations and governments that are over levered will be much less likely to default, which means recession is much less likely in the short run. It is a negative for banks as they do not get the advantage of a steeper yield curve that would produce greater spreads. The two year is now slightly below the Fed Funds rate at 2.38% and that is not a positive indicator for the economy, but it also means the Fed is likely to not raise in March. The drop in factory production and new orders is also a negative signal. It is unclear if this is a trend or a momentary event. Keep in mind the index reading was 54, which is still very good growth. The increase in factory jobs in December was very strong, so maybe the index is wrong. There will be no new tax cut for the middle class as the Republicans had set up for 2019, and that is not helpful. All considered, it is likely that 2019 will see modest economic growth, no major increase in inflation, continued low interest rates, and a volatile stock market. With rates remaining very low, and stock PE ratios now attractive again, more money is likely to go back into the stock market and back out of bonds, but it is way too early to predict anything with confidence. If there is true good progress with China on trade talks next week, the market will take off. For now, the market is ignoring the shut down as just being a lot of political nonsense, and having no real impact on the economy.
The world economy is a mess, and it has little to do with tariffs. The EU has huge structural problems plus Brexit. Trump had nothing to do with their troubles which began in 2008 and never got properly fixed. The ECB is possibly going to have to reinstitute QE this year. If he Dems had any interest in history, or understanding economics, they could look at the EU and see how socialist policies failed. France being the prime example of high taxes, restrictive labor laws and excessive regulation. Italy is barely hanging on, and only with help from the ECB buying its bonds that nobody else will touch. Italian government bond rates are below US Treasury rates tells you it is all pure financial engineering, not reality. Hidden is the very large portfolio of Italian government bonds now owned by Italian banks. If they were marked to real market, the Italian banking system would be insolvent. The problems in China are long in coming, and are a result of excessive leverage, rising production costs, massive corruption, and huge demographic issues with 400 million old people, and excessive building of condos and other property that remains unoccupied. Consumers are now 65% of GDP in China, and consumers are cutting back. Jobs are less available and overtime and bonuses are being eliminated or reduced. Leverage is a massive problem in China, and will get much worse as the economy shrinks. China has real problems with potential major defaults by companies and individuals. Tariffs just exacerbated the structural problems that were growing worse. China needs a deal with Trump. If tariffs go to 25% China is in real trouble. The government has lots of reserves to bolster the economy, but underneath there are serious problems which are now emerging. Other countries in Southeast Asia are not all falling into the trap of taking huge loans from China for infrastructure and being under their influence in the way XI hoped. They see what has happened to Pakistan taking these loans and are backing off. The US is not being pushed out. Xi will make a deal because he has to.
There is a real possibility 2019 could be a very good year in the stock market, but there are so many black swans, and so much resistance by the Dems and the press, that it could also be a weak year. As we get close to year end, the recession talk for 2020 will heat up and, just as occurred in 2018, the market could tank. The political rhetoric and press attacks will be at fever pitch as the primaries get going, and the mob of Dems running try to outdo each other attacking Trump, while at the same time, geopolitics will become very unsettling in the mid- east, and Europe teeters on recession, and none of that is helpful to the stock market. As the new jobs report showed, be very careful what you believe from Wall St analysts and the press. Pay attention to the data not the rhetoric and talking heads.
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6) Ocasio-Cortez Floats 70 Percent Tax Rates on the Very Rich
Rep. Alexandria Ocasio-Cortez, D-N.Y., is suggesting a tax rate as high as 70 percent on the very rich to help pay for a major plan to fight climate change.
6) Ocasio-Cortez Floats 70 Percent Tax Rates on the Very Rich
By Jefrey Rodack
Rep. Alexandria Ocasio-Cortez, D-N.Y., is suggesting a tax rate as high as 70 percent on the very rich to help pay for a major plan to fight climate change.
She floated the idea during an interview on the CBS show “60 Minutes,”which will be shown on Sunday.
“People are going to have to start paying their fair share of taxes,” she said.
"You know, you look at our tax rates back in the '60s and when you have a progressive tax rate system, your tax rate, you know, let's say, from zero to $75,000 may be ten percent or 15 percent, et cetera." Ocasio-Cortez said. "But once you get to, like, the tippy tops, on your 10 millionth dollar, sometimes you see tax rates as high as 60 or 70 percent. That doesn't mean all $10 million are taxed at an extremely high rate, but it means that as you climb up this ladder you should be contributing more."
The new lawmaker calls the plan the “Green New Deal.” It aims to eliminate carbon emissions within 12 years.
"It's going to require a lot of rapid change that we don't even conceive as possible right now," she said. "What is the problem with trying to push our technological capacities to the furthest extent possible?"
Ocasio-Cortez and other progressives have pushed for the climate change plan that includes thousands of jobs in renewable energy such as wind and solar party.
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