By: K(en(neth Louis) G(rant)
“Jones brings the ball up, dishes to Havlicek on the wing, Russell on the high post, checked by Baylor…. clock running down…”
I’m going really old school here (because that’s how I roll – especially lately), back all the way to my earliest NBA watching days. When Jones, Havlicek and Russell were locking horns with Elgin Baylor, the 24-second shot clock was still a relatively new concept. Moreover, in those years, the clock itself was not above the backboard, as it now, but rather affixed on the floor, at the four corners just beyond the base and end-lines. True story: long ago, my parents had access to floor seats at the old Chicago Stadium for (pre-Jordan era) Bulls games, and several times I was invited to accompany them. On one occasion, I actually had a copy of Pink Floyd’s “Meddle” with me, and, mischievous teenager that I was, I placed it on top of the nearest 24-second clock available. That is, until a ref forced me to remove it.
During another of these outings, I got to slap Mr. T on the back, as he paraded through a wall of fans.
These are my brushes with immortality. They may not seem like much to you, but they’re mine, and I reckon I’ll keep them.
In general, though, I’ve been worried about how much time we/I have left on the shot clock. I’m sure it’s not a great deal. And yes: a) it’s scary; and b) there’s a risk that if we don’t overcome our fears, it may expire before we even hoist one up.
In which case, it’s game over. A tragic, avoidable loss.
And I won’t lie: this whole boycott stunt by the NBA really hacked me off. It may hack you off that it hacked me off, but that’s for you to decide. The stunt passed quicker than my pique; I’m still traumatized by the experience. It felt to me like a bunch of inordinately successful guys got together and decided that maybe, despite all of the ruination which we have faced in 2020, things weren’t ruined enough. So, another cop plugs another minority dude, a teenage loser ups the action (in Kenosha, WI of all places) and what happens in the NBA? The multi-millionaires players decide they won’t participate as required under contracts to which they affixed their signatures – adjacent to those of their billionaire employers, in the process tweaking the trillionaire sponsors of the entertainment package that has enriched them all.
Was the intent to further the cause of social justice? If so, it was doomed to fail from the outset. It did not, could not, advance any cause of any kind. And my guess is that it ended as abruptly as it did because the lawyers for the Player’s Union, that righteous inheritor agency of the Mother Jones/Ludlow Mines labor crusade legacy, convinced the hoopsters that they had not a leg upon which to stand (much less to demonstrate their rad hops). That they must either suit up or risk losing both salary and (shudder the thought) endorsement revenues.
So, suit up they did. Before the clock expired. Didn’t cost them a penny.
So, the shot clock is back running. Not only for those baller ballers, but in fact for us all. Including investors. This month has only one trading day remaining to it (the rough equivalent of 1.2 seconds on the NBA counter), but nobody can accuse market participants of not attacking the rim; in fact, our equity indices, unless they bitch up Monday, will have recorded their strongest August in two decades. This past week, they were ballin’ like ‘Bron. Took their posterizing, elbow-flying talents to previously unreachable realms. As a result, The Gallant 500, since late March (remember late March?), has been annualizing at an eye-popping 57% rate. Other benchmarks are following suit, but there is no room for debate as to who the GOAT is. It’s Captain Naz, who went straight from the McDonalds All-American team to the bigs, and is currently throwing off an annualized return, over the same time, period, of nearly 250% (yes, you read that right). Which, if sustained, would render, by comparison, even Wilt Chamberlain’s (validity questioned) 100-point performance just another night at the office for the Big Dipper.
I can’t help but worry, though, that the shot clock is running out for these high-fliers.
I would also be concerned about that relentless “tic tock” sound emanating out of the Fed, but seeing as how they control the League Office, I’m hardly surprised that they changed the rules to their own liking. The announcement came from Powell (the unanimous MVP of the 2020 season – no matter what transpires from here) at Jackson Hole conference, wherein he unveiled a new policy the apparent gist of which is that, instead of establishing a 2% ceiling for inflation, they are fixing it at an equivalent average. Apparently, this enables them to overshoot the mark as they deem appropriate. Moreover, given the latest inflation trends (as presented below, in a nod to their infinite power and wisdom, through their preferred metric of the GDP Price Deflator), they seem now to be in a position to hold the ball indefinitely:
The equity markets were deeply impressed by the news, but that, in and of itself, is a low bar this summer, as they seem to be reacting to virtually anything and everything with an unmixed delight.
But somehow, Treasuries sold off on the tidings that the Fed can goose the monetary economy until it sickens of the tactic. Here, I throw the challenge flag, or (given that we’re talking hoops in this piece) ask the refs to take another look. Because the statement itself, by all logic, should have been accretive to Treasuries – across the entire curve.
And I’m back to thinking that long the 10-year note presents an ideal hedge against a downdraft in the equity markets– a call I made earlier this year which worked until it didn’t. Yes, Treasuries could continue to sell off, but only against a rising equity tape. Similarly, I just don’t see how the equity markets can suffer a slide without it redounding to the benefit of govies. Investors should naturally move capital there if this happens, and if they don’t the Fed will simply have to step in.
Because remaining among the dwindling inventory of certainties in my bag of prognosticative tricks is a strong conviction that the U.S. and global economies cannot abide higher interest rates at the moment. Wanna kill off that improbably red-hot housing market? Raise rates. Tired of increased value of corporate bonds and other instruments of devilish credit? Same thing.
And in a similar vein, anyone watching the doings of the U.S. dollar should be forgiven for wondering if the sands are running out in terms of its status as the world’s reserve currency. Equities are rising, bonds are selling off – implying higher yields, all of which should be accretive to the Dead Prez. Instead, it’s in free fall, and, again, this is not only against other fiat currencies, but also as measured in terms of most risk assets. Probably, you can fill in your own blanks as to why.
And I cannot continue without tipping my hat (which I don’t own and wouldn’t wear if I did) to Charlie Parker, who would’ve turned 100 yesterday. He was born three days after the passage of the 19th Amendment, and a week after Elvis made his TV debut on an obscure outlet in Shreveport, LA. Bird’s personal shot clock was short, spanning only 35 years. Man oh man, did he make the most of them.
But winding the clock forward, as we must, to the present day, I suppose we should get a word or two in about the election. Because it’s an important election, or so I am informed by several Facebook Warriors with whom I am connected.
It is also important from an investment return perspective, but I won’t elaborate too much on that score.
I will state, however, that I am delighted that the clock has expired on those infomercials that pass for national party conventions in these troubled times. Truly, I miss the balloons. The sashes with state names affixed to them. And the funny hats. Maybe they’ll return some day.
It does appear that in terms of milking the clock, the Dems own most of this tactic. Can they really get to November without their boy debating 45? I think they’ll try. I hope they don’t succeed. Moreover, if the polls turn, you would certainly see their offense in motion, looking to take their shot.
And elsewhere, the clock has officially expired on Japanese Prime Minister Shinzo Abe, who took a knee this past week due to the increasingly debilitating toll that ulcerative colitis has taken on his person. Not sure what happens next over there, but my view is that Japan could and might do a lot worse with his replacement. At the point of this correspondence, Hideki Kuroda remains in control of the BOJ, so at least we can be thankful for that. Because the world needs more JPY, and Kuroda is our guy to deliver it.
But my time is running short, and, in moving towards my close, I will reiterate my call that vol has to increase as the seconds until the election begin to dwindle to a precious few. I don’t expect much action next week, as we finally reach the suckiest holiday of the year: Labor Day. I’ve mentioned this before. I hate Labor Day. Labor Day sucks. Mostly because it is followed by a long slog during which All God’s Children must confront many unpleasant tasks that await us, and for which we used the summer as an excuse to ignore. Gotta get my driver’s license renewed (among other things). Wish me luck on that.
Similarly, I say the clock is running out on this season of one-way rallies and a volatility tape as benign and docile as what passes for defense in the NBA All-Star Game.
Which means we should think about getting our asses in gear. I’m not suggesting that we fire away indiscriminately, at will. But the time has come for everyone to focus, draw a play up on the chalkboard, and, for the love of God, execute it. We don’t have all that much time (as the ringleaders at the County Seat once warned Bob Dylan, after he disclosed that the girl with him behind the shades was not his property).
True, we could throw up a a brick; but I think it might just tickle the twine. Or, if it bounces off the rim, maybe Russell will be there for the rebound, bestowing upon us, in the process, the gift of a fresh 24. Nothing would be sadder, one way or another, than allowing the ticker to expire with the ball still resting in our sweating, sweaty palms. After all, the shot clock is there for a reason: to ensure we don’t dawdle away our precious time with little or nothing to show for the effort.
We’re better than this, right? So let’s show it. It’s (almost) time.
TIMSHEL