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Thread: Ari is on to something. A presidential election with all the downballot races that entails is no time for experminents.
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Ari Fleischer
@AriFleischer
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CA, DC, VT and NV will for the first time mail actual ballots to all voters. It took WA years to do this right. These 4 states are rushing to get it done. It is fraught with risk, especially if an election is close and ballot harvesting is allowed.
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Another Rant
Another Rant
The retail and production numbers are rising again, and should come in better next
week. Inflation remains modest at 1.1%. Labor costs are up only slightly. Interesting
note- PC and smart phone sales are up with one-half being first time buyers. Now they
find instead of one computer per household everyone in the house will have one of
each. July jobs numbers will stall, but now things are returning to big growth and GDP
is likely to grow by 20%-25% in Q3, due to housing and manufacturing, and more
reopening. The July ISM numbers are better than everyone expected. The stimulus
from the Fed and fiscal will be 50% of GDP after this next package from Congress.
Combined with ultra-low rates, there is a huge cash flow push into the economy that is
like a flood. Adding to that, 100 companies have already begun to move back to the US
from China with more coming. In addition, many EU companies have concluded they
need to have operations in the US now. All of this means jobs. Housing is very strong
which means lots of jobs for low skill people. Not just to build the houses, but to make
the things that go into creating a new house and household. Also adds to services for
homeowners like plumbers etc. July may surprise on the upside when all the numbers
are in. GDP Q4 likely to be 5%+ and into 2021 unless Biden wins and they raise taxes
on corporations taking away Capex and wage increase available from company cash
flow. Add on to this a huge new capital spend in R&D, mainly into tech (47% of total
R&D) which is designed to improve productivity, which increases wages by increasing
profit margins, which can then go partly to higher wages.
Tech is bringing the new industrial and service industry revolution, and is changing the
whole nature of how we do all sorts of functions better and more efficiently. With
advances in AI, this is just at the early stages. AI is not going to reduce jobs. The
benefits will grow the economy, and create jobs in my view. So, conclusion, starting
now the economy will grow fast, the end of the $600 will push millions back to work,
GDP will zoom up by record amounts, and the Fed will be responsible for Trump to be
reelected. Trump should build a monument to Powell. Claims by “experts” that the
$600 is not a disincentive are stupid on their face. Some people are making more just
with the $600 than they were making working, and then add on state unemployment
payments. In many places in NC the average income is $28,000 per year, but the $600
is $31,200 annualized, plus state unemployment. They have to be idiots to go back to
work and earn far less. If Biden wins, and we get what he promises with high taxes and
lots of regulation and anti-business and anti-banking from Warren, you can kiss all this
goodbye. It is that simple. I believe with Q3 economic numbers being terrific, jobs
returning for millions in Q3, and Durham, a vaccine in late October, sharply declining
virus, the public getting scared with rising crime and Dems wanting to defund cops,
getting fed up with the cancel culture, and the debates which will make Biden look like
the bumbling fool he is, Trump wins, so long as he modifies his style, which he seems
to be trying to do.
Here is where I am at on the stock market. I have no idea where we end the year. Here
are the good and bad. Likely there are vaccines by early November. Very good for
market. Likely only 50% willing to take it at first so unclear real benefit. By then,
however, therapies and treatment protocols reduce hospitalizations and death to very
low levels, and economy recovering very well. All of this appears realistic. Trump
wins and R’s hold Senate. All very good for market. If Biden wins and Dems get
Senate, disaster for market and the country. Fed decides to manage yield curve. Very
unlikely, but possible. Bad if happens. Dollar continue to drop a lot. Bad for market
and inflation. Dollar stabilizes, good for market. Cities continue to have out of control
shootings and crime. Bad for country and market. Don’t expect this to change by
time. Maybe that causes a lot of election shift in governors to law and order. Maybe
mayors who let cops do their job and do not defund get elected. Or maybe the Dems
push out so much money to voters that they still keep same Dem mayors and governors
and cities lose a lot of population. Bad for everyone. Maybe the new monetary and
fiscal stimulus in EU works and they start to recover. Good for market, but they are in
such bad shape it is unclear there will be a strong recovery. Maybe there is a much
further ramp up of confrontation with China. Bad for market, but necessary for
national security. No way to predict where this goes, but clearly there are no further
trade agreements. If Trump elected, the confrontation with China escalates. If Biden,
he rolls over and China becomes much greater power, and the world and US pays a
big price in a few years. Maybe most people get disgusted by cancel culture and free
speech starts to return to campus and the press. I think this is a long way off, and that is
bad for the country and unclear what impact on market. If Biden elected it gets much
worse with the far left in control. Maybe the new phase 4 plan is so costly it really
wrecks fiscal integrity in US and creates distortion in bond markets over time.
Extending the $600 for more than a week or two is terrible, but Trump seems,
incorrectly, to think it will help him get elected I suppose. Big mistake as it will keep
unemployment high and have opposite effect Trump wants. He blew it on this. If you
have not done the math before, $600 is $15 per hr for 40 hours. It was not an arbitrary
number the Dems just tossed out. Mnuchin got suckered by Pelosi, and now it is
embedded as something the Republicans want to deny to the unemployed, and the
press is emphasizing that with phony sob stories of people, and from reporters,
claiming they can’t eat if no $600 that they never had. So for 65% of the unemployed,
it is one and one half to double their old wages in some cases when added to state
unemployment. A lot of cash helps asset prices and markets short term, but deficit
becomes a crowd out factor in the bond market over time. So the election is crucial to
the stock market, and the country. If Biden wins and Senate goes Dem I am out of
market. If Trump is reelected the market goes to 3400, and then higher next year.
This is not the dotcom bubble with a bunch of badly thought out start-ups, and any
comparison is absurd and ignorant. The big tech companies are very real, giant
businesses, with massive cash on their balance sheets. Despite whatever Congress
does, these companies are now critical infrastructure for the country and the world, and
for corporations. They are not going away. There is a huge spend on tech to upgrade all
sorts of business functions and advertising/marketing, and that is not changing.
Smaller tech companies are going to thrive if they have effective products for
improving productivity and efficiency, or can provide data analytical results that are
far better than current methods. The problem is to be able to spot the winners, and that
part is very hard in a subject area few of us understand. As a result I do not believe
these companies are over-priced for long term investors such as myself. For the next
few years, nobody is replacing Apple, Adobe, Facebook, Alphabet, or Amazon.
Maybe in 5 or 6 years, but for now the big guys control their spaces.
Not noted much anywhere are the currency swap lines the Fed made to 16 countries
central banks. When the crisis hit in March there was a worldwide scramble for US
dollars to cover all sorts of bonds, trades, and product purchases. The Fed made dollars
immediately available to major country central banks where they swapped dollars for
local currencies with the guarantee of the opposing central bank and a swap back at the
then same rate as the swap. Many of these swaps have now been unwound. In short
zero risk for the US Fed. They also made loans to other countries taking those
countries holdings of US Treasuries as collateral. Again zero risk for the US. By doing
these things the Fed flooded the world with US dollar liquidity. Had they not done
this the world financial system could have collapsed and countries and foreign
companies that issued US dollar bonds, or who had US dollar receivables or
, would have also collapsed as the currency markets would have frozen. This move by
the Fed was unprecedented in magnitude and speed. They saved the world, but as
important, they firmly set the US dollar as the world currency by demonstrating that
the Fed backed the dollar in any circumstance, which sets the dollar apart from every
other currency. This probably ended all talk of the Yuan or a new reserve currency.
This is very good for the US as now we have incredible power to shut out a country
that we want to strangle. Because this is a complex subject the press never discusses it
because the reporters are focused on left wing attacks on Trump, and they miss what
is really happening, which none of them have the education to understand.
There is a lot of very good news on vaccines, and it comes from Wall St analysts who
know and track this stuff, not from politicians or government docs. They report that the
progress is indeed excellent, and there is a high chance we will have one by late fall.
The problem is not getting the vaccine. It is, a lot of people are afraid to take it based
on no knowledge. I have always predicted that there will never be 100%, or even close
compliance, and it could be as low as 50% or 60%. It is unclear what the ramifications
of that are by winter. You may need to learn to like your mask for a long time. I
intend to get the vaccine. One caveat when you hear drug companies report results of
tests. The dosages used are different from one to the other. That does not mean one
works, and not the other, but results might be skewed at the early testing stages until
they get it right.
Overall cases and hospitalizations are coming back down. ICU use is also down. Docs
report they now know what to do and how to treat, so deaths will decline. If you take
out NY, the death rate in the US was relatively not worse than most. There is also a
major effort to protect nursing homes so we will not have another Cuomo disaster of
putting sick people in nursing homes and killing twenty thousand or so by doing so.
Forget number of cases. It is number of hospitalizations that counts. More tests, more
cases, but most are asymptomatic, or require no special treatment. Note the press still
thinks Cuomo is a hero. It is expected that 74% of kids will be back in class despite the
teachers union who says they will strike. I say, fine them and the union if they do strike
Trump should use his powers to order them back to work under the defense act if he
can. They are a disgrace. TX, FL, and AZ are continuing to see a downtrend in cases
and hospitalizations, and that is very good news. It means large states can move ahead
on reopening very soon as the numbers come back into line in a couple of weeks. It
also means the fear factor will decline as that happens and schools can reopen. The
press needs to report the good news about schools instead of all the fear mongering
which is scaring moms. 75% of black kids grow up in a single parent home so if there
is no school those kids and their moms who can’t go to work are the big losers, but
black lives matter, just not to the Dems, teachers, the press, or left wingers.
For all the todo in the press about ventilators, docs now say they probably killed people
and are rarely used now. For all the raging about tests, they are up to over 60 million,
but the real issue is stay out of bars and big parties. You can test all you want, but if
young people go to bars and date, there will be spread. If there are protests, there will
be spread. Tests are good, but not the panacea the press makes them out to be.
Rutgers English Dept has now decreed that proper English pronunciation and grammar
are racist. Huh? They are back to the black English mantra of a few years ago. And
then expect the students to come out able to write and speak properly to get a good job?
NYT staff demands that in a couple of years more than 50% of staff be of color. Forget
can they write properly and intelligently, like if they came from Rutgers. The only test
is you are hired so long as you are not white. Unemployment in NJ is very high. So the
legislature just passed a bill to let illegals get professional licenses to take jobs from
citizens. Great thinking. In Illinois they want to do away with history books until they
are rewritten to the approval of black left wingers who want to rewrite history to delete
the things white men did to make this country great, and instead make them look like
racists and oppressors. Academia and Dem states just get whackier and whackier, and
in the end the kids and legal citizens suffer. My college professor friends at tennis tell
me, depending on the class and level of the students, online is not nearly as effective
as in person. If you are just teaching basic math, it works, but if you are teaching more
advanced students more complex math, it does not really work. Having taught graduate
level myself at NYU, there is nothing like in person classes for the interaction, and the
being able to read the body language of the students to see who needs more help. This
is not going to be a good year to be a student which is why many MBA students are
not taking online classes and will work another year. Columbia Business School has
determined that 1/3 of tuition is for learning, 1/3 for networking and 1/3 for other, so
they will break classes into thirds, and one day 1/3 go to class with a professor, and 1/3
in another room with video feed, and 1/3 stay home. Each day they rotate. Classes
runs from 7 AM to 9 PM to make this work. And this is supposed to be highly
intelligent professors who came up with this absurd nonsense so they can rationalize
collecting full tuition.
This year so far there have been 4 US deaths in Afghanistan from the enemy. In
Chicago that is a few hours death toll on a Saturday. June had 105 murders. So far in
seven months they had 2240 shot, and 440 dead vs 4 soldiers in combat, with 3700
guns seized. That is 10 people a day shot on average. And this is just Chicago. Kansas
City had 700 shot. In NY shootings are up 277% last week over prior year. Portland is
having its worst year in 30 years for shootings. So of course the city council disbanded the gang and shooting violence team as being racist because they stopped more blacks than whites. The exact same reasoning as DeBozzo used in NY to disband the anti-crime under cover units. So in NY shootings are up 277%. Duh. Police response time in Portland to shootings is up 100% from last year. 400 NYC
cops put in for retirement last week alone. This is what BLM and defund the cops has
brought you. Almost all of these deaths and shooting victims are black. People in black
communities are now complaining they have no protection at all. But the Dems want
even more restraint on cops, and more budget cuts, and fewer cops. Result- many more
dead young blacks, destruction of minority communities, further flight out of cities by
taxpayers, fear by kids in these bad areas so school work suffers and the black kids lose
out, but black lives matter. At some point maybe there are so many dead and wounded,
or in prison, that the mayhem drops off as there is nobody left to kill. That is what
happened in the South Bronx decades ago. This move to get rid of cops may be the
greatest mass stupidity in history. It will matter in the election when people in cities are
scared to leave their house. This is reliving NYC under Dinkins, only more deadly.
Free the felons supposedly due to virus, no bail, restrain cops, disband under cover
units that specialized in getting guns off the street, and have Pelosi, press, and
governors and mayors attack police, and what do you get- mayhem, more white
taxpayer flight, and more dead black men along with black kids afraid to go out to
school or play. Once school starts universities will glorify Floyd and declare whites and
cops to be systemically racist. Many schools will require classes that teach that
America is a racist nation. There will be no history taught. No acknowledgement of all
the blacks who became CEOs, or have their own company. Obama will not be shown
to be the acceptance of blacks at the highest level. No mention of all the black mayors
and police chiefs. Only victimization. They will admit many more blacks, and drop
SATs because they know SATs show kids from poor ghetto schools do not have the
high school background to do the work. Now with these areas becoming gang war
zones, they will be setback further. Tell me the difference between a gang drive by
killing in Chicago, with 14 shot, and a Taliban attack in Afghanistan killing civilians.
Or take Portland with explosives thrown at cops. There is no difference. These cities
are at war, but they reject help from Trump.
I have zero information about what Durham is going to report, but I am having a gut
feeling that it is a bombshell that will change the election and make the press and
Mueller look like corrupt idiots. I believe he will have found there really was a coup
in progress, and it went all the way to Obama and Biden. I think Obama was the
overall approver, but Brennan was the puppet master. Comey was a key player, but
not in charge. Mueller was just an avatar who had no real idea what was happening.
Clapper, Jarrett, Rice, etc were all involved. Who gets indicted is a separate issue, but
supposedly there are already plea deals, and people spilling the story. I bet Lisa Page
has spilled a lot. Maybe McCabe or Steele have cooperated. Maybe Comey will cut a
deal if they really have him. I expect this has taken long because they had a lot of
onion to peel back, and more and more conspirators began to talk. Somewhere there
was a big break when Durham brought in two other US Attorneys to help. That
suggested the case blew wide open. Someone talked. Pelosi and Co will have sustained
attacks on Barr to try to make him look like a political attack dog for Trump to try to
claim this is all a plan by Trump and Barr to impact the election. It is why Nadler
wants to impeach Barr. Durham will go down in the history books for having
uncovered the worst political threat to the nation in history. Barr is the perfect AG for
this. You think Covid and murders in cities are bad, wait for this. 2020 is maybe the
worst year for America since the civil war.
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