MARKET SELLOFF COMING CASHMCCALL WARNS BRUTAL AUGUST TRUMP DUMP CORRECTION
August markets are the sour turn into October. The fact that markets have done well this year for no reason is all the more reason to fear August. The best August’s in history were Reagan Years with double digit gains in 82 an 84. Clinton, Bush II, Obama years were for the most part down. The magnitude down is generally much greater than the magnitude of the up years with the exception of Reagan’s big years. The worse August was down over 14% in 1998. That was some haircut. This year could be worse. MARKET SELLOFF COMING CASHMCCALL WARNS BRUTAL AUGUST TRUMP DUMP CORRECTION.
Trump is no Better than Bush or Obama with the Economy. One thing is certain, Reagan made them all look sick. Trump ain’t no Reagan. Trump is a Bush Third Term. Remember how that one ended?
Under Trump Government is spending like a drunken sailor. That makes markets rise but the GDP is flat.
The budget is over $4 Trillion and Trump has accomplished next to nothing. The economy is flat. Consumer spending is down two quarters. Wholesale prices flat. Americans are swimming in debt.
If Obamacare remains and Democrats and RINOs bail it out, August could crack down hard. This would also bode poorly for tax cuts. Remember this was going to be the world’s greatest Tax reform. That is scaled back now to George Bush style chump change tax cuts. But keeping Obamacare would be a pile driver and then in October the Government runs out of money.
Even Trump’s feeble attempt at deregulation has amounted to nothing but more headwinds. He is stick in one liberal court after another. His legal team is flatly inept. Meanwhile John McCain and Collins voted down the takedown of Methane rules. There is no oil in Maine! Arizona has no oil. Trump can’t get anything done.
His own EPA director who is doing a good job has publicly stated progress has been limited because Trump hasn’t made key appointment necessary to support his director. Trump talks but he is completely ineffective at leading.
Massive Government spending portends RECESSION.
Nobody likes the “R” word but we are headed for it. One thing markets abhor is uncertainty. Each week Trump blabbers about some industry or threatens some merger and causes sector havoc in the market. His moronic attacks on the pharmaceutical industry demonstrate how utterly stupid Trump is when it comes to business. The single most coast effective treatments for diseases are medicines.
Yet it has become very popular for Democrats and Trump to attack pharmaceutical companies. That is why many are leaving the USA and taking biotechnology with them. Ever since Bush put the kabash on studying stem cells, there has been a huge US Brain Drain. And to inform that moron Bush, Cancer Cells are Cancer Stem Cells. Politicians are just wrecking this country. The Bush recession and subprime collapse is just tremors of the earthquake to come.
There are so many areas of weakness:
From student loans to rising state taxes even in Republican controlled houses Government spending is simply out of control. Each time government spending rises, that is less money into the private sector in terms of GDP and that means less growth.
The US dollar is at nosebleed levels and US businesses can’t export products.
US Businesses simply can’t compete globally. Our biggest export is weapons. Those can hardly be called capitalist businesses. They are essentially State Run Businesses. Who do you think pays for Boeing’s aircraft designs? The Taxpayers pay for all of it. From Design to prototype. Does Boeing ever send Taxpayers a thank you note to the when they put an aircraft into production and sell it overseas? They should be paying back the Taxpayers. But that is how those Defense businesses stay in business. None would exist if they have to operate on market forces alone.
Obamacare nightmare will remain.
Under Obama and as a direct result of passing Obamacare, almost the entire US Semiconductor industry fled to Asia. GE moved all their medical imaging businesses to China. Democrats were taxing medical devices. What in bloody hell is wrong with those idiots? They want to control everything but they don’t have the brains to control a yo-yo. Those brain intensive industries will never be back.
The economy hates uncertainty. Trump is an exploding cigar.
It is no longer amusing to have a clown presidency. He inject uncertainty daily. If he attempts to focus on something; he just rings the stupid bell. Then he gets fixated. He is a walking conflict of interest.
We were appalled at the sloth of the Obama’s spending nearly $200 million on lavish vacations over eight years. But Trump has already exceeded the cost of Obama’s third term. Trump has not separated himself from his businesses. Foreign dignitaries are staying at his Washington Hotel. State dinners and vacations are staged at Mar-a-lago. Trump Towers is leasing office space to the Federal Government. He’s using everyone.
Personally, I am sick of the Trump Kids. I don’t want them around. They make me ill. This nepotism crap has to end. You have Donald Trumpski Jr. the Russian spy contact. You have famous for no reason Kushna. Then there is the female baseball head Ivonka. Do we continue to have to be subjected to these nothings?
Name one policy where you think Trump knows anything.
You will never find any. People talk about the Trump Agenda. What agenda. It is like trying to find a brain in a shark. There is no agenda there is no method at all. Trump moves from one inept moment to the next trying to cover his tracks. Nothing is working.
The lynch pin will be this disastrous TrumpCrapCare bill. It will not pass the senate. Any Republican that signs on is a RINO. It will destroy the Republican Party. Though Our claim is that the Republican Party was destroyed by the Bush Klan who were the “Anti-Reagans.” Trump is running a Bush Third Term. I really think he is not going to run a second term. I think we will be in a massive recession by then.
People in America simply have no freedom.
And when Trump is done you won’t have any money either. So be smart. Lots of talking heads have called for a market correction. Dump IBM; its gong below $100. Our view is that government spending creates bubbles. When markets go parabolic it is time to look for the exist. We are still invested in emerging markets which will do better than US markets over the next six months.
August markets are generally down. September is virtually always down. October is the month that mutual funds get trigger fingers.
With Trump in office, and his billionaires you might think a collapse could be avoided. But that will only provide a sense of false confidence, limiting short sellers and increasing the velocity of any correction. We think it could be brutal.
We are presently building a short position in the Russel 2000 while clearing nice profits from the last six months. A number of sectors look alarming to us those being Transportation, Healthcare and industrial.
We like some commodities, oil in particular. We have been building bottom positions gradually. Geopolitical risks are high. We think a 50% cash position is warranted presently. Since we think this will be a long harsh sell down, our entry point will not be until at least late November or the second two weeks in December.