It’s astounding, Time is fleeting, Madness takes its toll,
But listen closely… (Not for very much longer), I’ve got to keep control
I remember doing the Time Warp, Drinking those moments when
The blackness would hit me, And the void would be calling
Let’s do the Time Warp again, Let’s do the Time Warp again
— Riff Raff (Rocky Horror Picture Show)
I struggled mightily to identify this week’s motif. As hard as I have for many a spin around the sun. Maybe I’m just getting too old to spend every weekend spitting out this bit of glib excess that passes itself of as market commentary. But I knew I had to forge ahead. Because you’re counting on me.
Leitmotifs, on the other hand, presented themselves in embarrassing abundance. Careful readers and close associates recognize, for instance, that tomorrow marks a rather important personal milestone. But it’s one that has mixed implications, and, beyond this, I just can’t descend to the rhetorical depths of featuring it, for no other purpose than the launching my weekly musings.
Other potential themes presented themselves, for instance, the whole above-represented Time Warp riff from Rocky Horror. We did, after all, just celebrate Halloween, did we not? And Rocky Horror is one of my all-time faves. But it occurs to me that Halloween is perhaps the holiday that most abruptly ends when the calendar flips, when the clock strikes 12, and All Hallows Eve becomes All Saints Day. At that moment, we’re all sick of it. Sick of the candy. Sick of the costumes. Sick of the B-Movies that run 24/7 on TCM, all month long. We’re ready to move on. And we have. Moved on, that is.
I also noted (and considered featuring) the recently announced, final toe-tagging of iconic retailer Barney’s, and thought about calling this week’s piece Barney’s Rubble. But I passed, for a number of reasons. First, it seemed to be entirely too “New York Posty” of a title. There’s also the reality that I’ve never set foot inside any of their stores, and therefore can’t authentically lament Ol’ Barn gathering to the dust of his forebears. Finally, the whole Barney Rubble thing is somewhat triggering for me, as, about a generation ago, it hit me that I was older that Fred Flintstone and his lovable sidekick. I figure them each to be, now and forever, around 35. If you grew up watching them, they always seemed so aged. And by the mid-90s, it became undeniable that I myself was older than either of them. It was a kick in the head, and, a full generation later, as my 60th birthday beckons, my temples still ache at the thought of it.
Then, on Saturday morning, in time honored tradition, I flipped through Barron’s, and (though it shames me to have drawn my main theme from such a ubiquitous source) there I found my answer. In reviewing the astonishing rage of recently reinvigorated bovine market conditions, the publication pointed out how top heavy the rally is. In particular, it chronicled the amazing fact that four companies Microsoft, Apple, Google and Amazon: a) now sport an aggregate market capitalization in excess of $4 Trillion; which: b) exceeds the valuation of the entire Russell 2000 Index.
So welcome to the MAGA market, brought to you by Bill Gates, Tim Cook, Serge/Larry and, of course, the biggest dog in the yard, former D.E. Shaw employee Jeff Bezos.
But you really didn’t think that you’d escape my double entendre obligation to endure my devolving into the murky realm of politics, now did you? You didn’t, because, from a certain perspective, this is also a “Make America Great Again” MAGA market.
Somewhat split personality macroeconomics bear this out. While everyone bitched a bit about the 1.9% first print on Q3 GDP, those bellyachers were completely silenced with the drop of Friday’s Jobs Report. Its contents had 45 crowing like a blackbird at dawn on an Iowa farm telephone line. It also zipped the lips of all of the windy Wendy Whiners out there in the punditry. This, of course, came on the heels of yet another Fed rate cut, and on an earnings tape that has, on balance, exceeded what were (it must be admitted) muted expectations.
So the Gallant 500, Captain Naz, (my fellow geriatric) General Dow, and even the above-maligned upstart Ensign Russ surged ahead into previously uncharted territory.
In doing so, this joint operation ignored many forces of nefarious risk, including the continued threat of trade wars, the Brexit Soap Opera, the California Infernos, and other sundry specters hovering out there to plague our peace of mind. And why the hell not? This here decade-plus recovery is chugging along better than anyone could’ve reasonably expected for such an old codger. We’ve got full employment, historically benign financing costs, no meaningful inflation, and, on balance, very little cause for economic complaint. In fairness, some form of MAGA prevails in the capital economy.
Indisputably, all of the above explains, at least in part, why investors also have turned away, with a derisive yawn, from the Impeachment Saga. Because, in case you missed it, over the next few days, the House of Representatives will approve Articles of Impeachment against the President of the United States. The latter will then of course be compelled to endure a trial of sorts. As will the rest of us.
Now, old-timer that I will formally be as of tomorrow, I must nonetheless inform you that I don’t recall much about similar proceedings against Andy Johnson. I was only a tyke back then, after all. I do remember my parents speaking about it, but I kind of shrugged my shoulders and then went out to fetch wood, as my daddy had instructed me to do. But I do have vivid recollections of both the Nixon removal and the Clinton psychodrama. And what comes to mind, by comparison, is as follows.
In both 1974 and 1998, these episodes virtually stopped time. With Nixon, the narrative unfolded over a couple of short months that summer. In Clinton’s case, the whole process – beginning to end – ensued over about three weeks. But in each of these cases, we were all fixated on every twist and turn. And even investors had sufficient respect for the dignity of the proceedings to make a show of selling down some of their holdings – albeit temporarily.
But in the present state of affairs, unless you are spending your time unwisely immersed in Cable News or the musings of the New York Times/Washington Post, you’d barely know that any of this is going on. And as for investors? A quick look at any index chart will tell you all you need to know about their level of concern in this regard. In a word, they just don’t give a sh!t.
MAGA market? Whether it’s MSFT/AAPL/GOOG/AMZN or Trump, I’d call it a Hard Yes.
Impeachment, therefore, looks like a losing political strategy to me, but please consider the source. I actually thought that Trump was gonna lose to Hillary back in ’16. Moreover, and to my way of thinking, the Dems are doubling, throupling down on all of this. And I don’t think it bodes well for their 2020 presidential prospects. The current field of potential nominees (now that my boy Beto has exited, Stage Left) is winnowed down to an aged, privileged, compromised white man who can barely string together a coherent sentence, a Che’ Guevara Millionaire Socialist, and a dour female professor who claims to be a capitalist, but wants government to take over at least two of the 13 economic sectors (Health Care and Energy), which compromise more than 25% of the country’s Gross Domestic Product.
And I’d be remiss if I didn’t give a shout out to my two highest profile former Chieftains: Paul Tudor Jones and Steve Cohen, who, at a Robin Hood Investor Conference this past week, both independently prognosticated that if either Bernie or Liz takes the prize, for equity investors (as Steve likes to say) it’s “Katie, bar the door”. Of course, as loyal readers are aware, I’ve been committing these same comments to writing for the better part of a year. Just saying….
So the Dems are going to spend the next few weeks impeaching the President, and are likely to fail in their objective of removing him from office. By the time they’re through, the Iowa Caucuses will be hard upon us, and their high-tax, high-regulation, full-on-redistribution platform will be etched in stone. I find all of the contestants to be signally unlikeable, and my gut tells me that a yet-to-be-identified horse will not only enter the race, but actually take the prize (the nomination that is; not the general election). We all are aware of the names being whispered about, but I don’t think it matters much. Because no one can win the nomination without carrying the yoke of a policy agenda that should land like a thud with the general populace, come next November.
It all looks like a Circular Firing Squad to me:
And if I’m right on that score, then the sponsors already are ahead of themselves, because we can spot them The Squad to lead the proceedings. All that is wanted is The Circular. And The Firing. And how hard should these be to source in this Information Age?
I reckon all of this could change in a heartbeat. For example, maybe Trump’s own son could find himself with a lucrative seat on the board of a shady Ukrainian Oil Company, his utter lack of credentials for the post notwithstanding. Maybe the Big Guy will be caught bragging on tape about reneging on the $1B he will bring along with him if the Ukes fail to do his personal bidding. If so, the game changes. Pretty quickly.
But in the meantime, gosh almighty, is it just me, or are the progs doing everything they can to gift another term to a man that they detest with every cell of their body?
And, for the record, the current office-holder gives me a raging headache. He’s a blowhard who strikes the fear of God into anyone who listens to him for five minutes. Count me among those that would really like to see just about anybody beat him. Except, that is, those that are actually running against him.
I reckon we should stop worrying, and embrace the MAGA market for what it is. Even at these lofty elevations, you have my blessing to by a few shares of MSFT, AMZN, etc. And if I see you in a red cap, I’ll not think the worse of you for wearing it. But as for me, I’m clearly in a Time Warp again: first a jump to the left, and then a step to the right. I stop there though; no pelvic thrusts possible at this age…
But I must take my leave now. Those that love me are ready to shower me with their singular affection, of which I am sorely in need at the present moment. I’m advised that there are even a few surprises in store. Some things I need (grooming products); some I don’t (a puppy). I thank them, one way or another, for not only putting up with me, but for, even at my advanced age, loving me as they do.
Truly, in this Time Warped, Barney Rubbled, MAGA world, I just can’t live without it.
TIMSHEL