What would you think if I sang out of tune, would you stand up and walk out on me? — Billy Shears
For those not counted among the teeming millions that comprise my social media presence, allow me to formerly announce the arrival of my grandson, William Thomas Feller. Further, as a public service of sorts, I offer the following glimpse at the little fellow, taken in the first hour of his existence:
Over the last few days, the looming specter of his arrival pressed the following problem on me: what on-line persona should I bestow on him? With my first grandson: James Alexander, the answer was easy. From the moment of his birth he was, is, and will remain, The Dude.
But there’s only one Dude, right? (OK, so there are other dudes, but bear with me). Looking for something materially different, I (with the help of my wife) cast about for the catchy, the urbane, the relevant. We first focused on the John Coltrane, whose birthday, so we believed, was shared by our newest bundle of joy, rendering the handle of ‘Trane a viable option. But a quick check of the record books indicated that Coltrane was actually born in late September. Not that this would’ve stopped us, but I won’t lie: it did give us pause.
Then it hit me, the iconic album: Sergeant Pepper’s Lonely Hearts Club Band was released on June 1, 1967, 50 years to the day prior to our blessed event. Given that our little guy’s name is William, the answer came to me. So let me introduce to you, the one and only Billy Shears….
(By the way, as my tragically constrained contributions to the future gene pool progress in a gratifying manner, it does strike me that I am being pushed further down the bench with respect to the birthing process. I was in the Labor Room the night The Dude was born, but was perpetually plagued with “make work” assignments, such as walking the dog, in such a way that I suspect was driven by an agenda to get me out of the way. Eventually, my wife and daughter ran out of pretexts and sent me home. This time ‘round, I wasn’t even at the hospital. But I am content, because, after all, what is life itself if not a process of making way for the new, while we the old fade to black?).
In any event, Billy Shears has indeed arrived, and from my vantage point, not a moment too soon, as it strikes me that the markets are in a paradigm that brings to mind the first lines that the original B.S. ever issued forth. Something indeed seems out of tune, but are you, is anyone standing up and walking out?
They are not.
In fact, if anything, investors are rushing the stage. U.S. equity indices hit a series of all-time highs this past week, and global markets are experiencing more or less the same paradigm:
Global Dow:
Bonds around the world are also in bid configuration. There’s some bouncing around in FX-land, but other that some intervention-driven strength in the CNY, there’s not much to report from that corner of the universe. Other than visible downward pressure on Crude Oil (proving, above all, that all the “smart” long speculation into the 5/25 OPEC meeting was, as I suspected, so much Dixie-whistling), the Commodity Complex is in strong bid configuration. Consider, if you will, the oft-overlooked but sentimental fave Cotton tape:
More than Dixie Whistling in the Land of Cotton:
Defying reverse gravity, the VIX actually managed to trade modestly down from last week’s record lows.
Through 5-and-a-stub months, the Gallant 500 is up 9%. So why is everyone so angry and nervous? Again, I think a good deal of the blame can be laid at the doorstep of the White House, or if not, blame, then at least root cause of agita. At this point, one simply does not know what next to expect, either from the President or from his well-funded, well-organized and increasingly unhinged enemies. I do indeed worry about this, my darlings, because never in our collective lifetimes (and perhaps not since the pre-secession Lincoln administration) have we witnessed such vitriolic hate of a sitting POTUS, nor, perhaps one so prone to fall into traps that empower and embolden his enemies. He simply, from my perspective, cannot resist lunging at any bait that is placed in his field of vision and I increasingly worry that sooner or later, he will indeed be hooked once and for all. Far be it from me to politically proselytize, but I don’t think that the organized resistance will be particularly pleased with any material success they achieve. It is, from my perspective, a case of careful what you wish for.
I am troubled, in particular, by the growing chorus suggesting that anyone not outraged to their cores by the current government power structure is either stupid, immoral or (more likely) both. The response from those on the winning side has been characteristically polite, muted and dignified, but if matters carry forward much further, this CANNOT last. The tens of millions who not only voted in Trump, but also carried home both houses of Congress, 30+ governorships and 60+ state legislatures, have significant, but in the end finite patience for being trampled upon. If pushed beyond their limits, they will respond by causing their own forms of trouble, and then, from a market perspective, it’s look out below. Again, I’d feel less concerned here if I didn’t think that Trump is an ideal target for the traps being set for him, but he is such a target, and if/when he steps into it for good, I shudder to think what comes next.
I’ll offer one last case and point with respect to this. The organized opposition has, by all accounts, crippled Fox News. It kneecapped its founder (now dead), it chased away several of its most popular hosts, and hired away a number of others. Those that remain are in the cross-hairs of the opposition and may not last out the summer. Its ratings are, inevitably, dropping.
But let’s extrapolate and imagine that they take down the organization entirely. This will leave the free TV networks, along with MSNBC and CNN to tell us what to think, and I believe that it would be a matter of microseconds before a right-oriented replacement sprung up, unconstrained by the opposition’s destructive playbook. At that point, the Kathy Griffin contingent may wax nostalgic for the happier days of the Ailes/O’Reilly/Hannity/Kelly/Van Susteren Fox News.
And no one will win. And the markets won’t like it. And this, I feel, is the biggest risk we face: a full-scale political unravelling that I believe is more probable than what is reflected in current valuations. As June busts out, and after the Fed raises rates next week, there won’t be much else upon which to focus, at least until after our Independence Day festivities are complete.
So take care out there everyone. You’re all my friends, I can’t get by without you, and neither, can, for that matter, the newly born Billy Shears. As for the original, he’s doing just fine. I read yesterday, with interest, that after spending the last 28 weeks on the Billboard 100, the original SPLHCB actually hit Number One this past week, some 50 years after Billy I first warbled his way into our collective consciousness. His words are as fresh and as true today as they were during the Summer of Love, and if I have anything to say about it, they will indeed inform the experiences of my progeny, for as long as the (Lonely Hearts Club) band plays.
TIMSHEL