We appear to have survived the annual reminder of the ruination of what once was a fine holiday – Columbus Day. Celebrating, well, Italian Explorer Christopher Columbus. Who certainly was not the first human being to set foot on North America, nor even, it is likely, the first Son of Europe to do so. Heck, he never even made it to the mainland of this continent. Across 4 separate expeditions over more than a decade, he bounced around the Caribbean for a few months and then beat his ass back to the protection of his underwriters in Spain. He never made the big score he promised to Queen Isabella, but over the subsequent 5+ centuries, the venture certainly amortized itself. And then some.
Since 1792 – 300 years after his initial voyage – and up until some unspecified date in the recent past – this country has used the occasion of what is believed to be his birthday (nobody really knows the exact date) to celebrate Italian American culture, contribution and heritage. This seemed — to me at any rate, to be well enough. But it is not in the ethos of these realms to leave well enough alone. Instead, A re- thinking of that ancient history marks these transatlantic journeys as the beginning of an extended era of brutal, still on-going cycle of exploitation.
So, now, because not everyone buys into the narrative, the day has transmogrified into a hybrid, as marked by the addition of its designation as Indigenous Peoples’ Day – thereby creating a desperate struggle of the vibes between European Imperialists and the longstanding occupants of the land they claim to have had stolen from them.
So be it. But it does make me somewhat sad. Because I was (am) a big fan of Columbus Day – if for no other reason than that it features the best damned parade in the whole damned NYC marching calendar. Others may prefer the Halloween Spectacle (too rambunctious), the Macy’s Thanksgiving ritual (too crowded and best watched on television), the Saint Patrick’s pre-game stroll in advance of some serious imbibing (close — but ruined by the absence of floats), or the too-inclusive Easter Parade.
Nope. Gimme the Columbus Day saunter up 5th Avenue. If you go, you’ll find me adjacent to the parade route, eagerly awaiting that Long Island Car dealership float, featuring the owner channeling his best Vic Damone while singing “That’s Amore” on continuous loop.
The Vicster:
This year, I have a long wait ahead of me. Because the Columbus Day Parade has been cancelled due to weather conditions.
And as I stand here, wet and bereft on 5th Avenue, I can’t help but wish things were a little different. The spirit of today’s holiday, after all, is a celebration, not of Columbus, but of Italian Americans. Which Columbus was not, but which the Brooklyn-born Damone was. Maybe we change the name of the holiday to Damone Day? Make everybody happy?
Meantime, and particularly for us financial eggheads, Columbus Day also marks the beginning of a 10- week sprint to the conclusion of yet another year. Thus, as the last tuba is snapped into its case, as the last uniforms are return to mothballed closets, etc., another travelling show begins – the dance of the year-end valuations.
And what a show it promises to be. From a sheer drama perspective, it — even now — has all the elements necessary to be a real banger.
The government is, by degrees, shutting down, and this time, potentially, it’s more than just show. Each side is smelling the other’s blood. Whither this takes us is anyone’s guess.
Federal troops are policing several cities, and the list will probably expand.
Perhaps the most important Armistice of the 21st Century is unfolding. But whether it sustains itself — or devolves into further madness — is entirely uncertain.
We continue to dance on the string of whimsical and whimsically articulated International Trade Policy. We’re flying blind in terms of government generated economic data. The Q3 Earnings Cycle, beginning, in time-honored fashion with the banks, commences this coming week.
This combination alone spices up the narrative. With no government data releases, it behooves investors to seek clues about overall economic health in the dominions of earnings. How are the credit card companies faring? What’s the technology spend? What quantity of goods are Amazon and FedEx shipping? How much are American corporations exporting and importing? And at what price(s)?
I suspect these matters will merit closer scrutiny than usual across the coming cycle. Which forces the rest of us to consider them as well. And, as we enter the proceedings, myriad indicators suggest that it promises, in general, to be a wooly ride.
Meantime, the subsuming of the Fed into the political vortex continues apace. Bringing the entire yield curve into play, and this well into next year and maybe all the way to the election.
In result, all asset classes are potentially on the move – so much so that it has driven that Coldplay Kiss Cam couple right off the financial pages.
And so, if you can’t find something to trade between now and Christmas, well, it’s all of your fault and note of mine.
The markets had a pissy selloff on Friday. And, not gonna lie – some of my peeps was spooked. Maybe they’re right, but I think the arrows still point up. Going into our Columbian celebratory weekend, with the government unable to fund itself, with crises from Portland to Putin to Palestine, it only made sense for investors to lighten the load a bit.
I don’t see a rocket ride from here, but with a ubiquitous Administrative State, which – let’s face it – is on a major roll, bent, through Monetary Policy and other dynamics to goose asset prices, with the ocean of liquidity still sloshing around a Nina/Pinta/Santa Maria market, the bovine is, in my judgement, likely to, er, Trump, the ursine.
It’s hardly the holiest of rallies – frighteningly narrow and driven by much gimmickry. The economic situation – even before the shutdown – is very opaque.
Absent the unabashed determination of the White House to lower rates and elevate asset prices, if conservatives on the Fed had any juice to reduce these forces, the issue might be very much in doubt. But it isn’t.
Somewhere, in the heavenly equivalent of 10 Downing Street, Margaret Thatcher, born 100 years ago today, is shedding an ironic tear.
And a good rule of thumb is as follows: in a free market economy, a government may be able to dictate pricing, but only: a) for a finite time, and b) at significant (though perhaps undefined) cost for having done so.
To me, this is what we are observing at present. With the political winds at his back and facing a life-or- death election in 12.5 months, Trump is operating a Command Economy. It won’t last forever, but it might enable him to skate through the midterms. Or it might not.
And in terms of the price we might pay, well, of course, it could take the form of a surge in Inflation, an economic concept upon which the government hopefully informs us it may be able to shed light in a couple of weeks. Or it could be something else.
But one problem it doesn’t solve, and which we’ll have to address at some point, is depicted in the following graph:
Raise your hand if you believe this is sustainable or will reverse itself on its own.
Didn’t think so.
But that is an issue for another day, my love. Meantime, we got us some trading to do. There’s money to be made and money to be lost.
But I reckon I’ll sit this one out.
Because the moon did in fact hit my eye like a big pizza pie. And the stars made me drool, just like a pasta e fasule.
And you know what that means:
Amore’.
That’s all we got. But l reckon it’ll do.
TIMSHEL