Quick Note On Putin

Quick note here – there seems to be some kind of general consensus that Putin is like Stalin – he is not.

Putin works for the oligarchs and as such he is the employee, not the employer.
What do the oligarchs want? To keep padding their bank accounts and not be dragged to a guillotine in the public square one day.
Putin wants Assad because Russia wants to maintain their last naval base in the Med which happens to be in Syria. Much of what Putin does is domestic posturing in order to maintain his employment – the illusion that Russia is regaining her imperial strength when indeed she is not is necessary to his continued employment.
Putin’s term of employment will likely not end with a dismissal notice but with being carried out of his office without a pulse. In other words, for Putin his employment and life span are expected to end at the same moment.
Putin must occasionally provide tangible evidence to the Russian people that the illusion is plausible in order to maintain employment. Losing his naval base in Syria is negative evidence.
Needing to continue the illusion that Russia is regaining her imperial strength inevitably requires Putin to be at odds with the United States and most of the world.

Inquiring Minds Want To Know

Kunstler nailed it this morning with ‘Either Assad is inconceivably stupid or possibly the gas attack is not exactly what happened.’

Most us in the United States have a difficult time grasping that Assad is that inconceivably stupid – but it is certainly plausible that he is that dumb.
That is one of the unknowns here.
The other unknown here is to what effect the Tomahawks last night will make Assad less than inconceivably stupid – Obama dropped 26,000 bombs on Syria and if it is true that Assad is that inconceivably stupid then will firing some Tomahawks be of better effect at making him less stupid than 26,000 bombs were?
Inquiring minds want to know…

It Stinks

Seven years ago the Fed set the requirements that would have to be met to normalize. Two years ago those requirements were met and at FOMC meeting after FOMC meeting the Fed said “yes the requirements are met but lets wait just little bit to make sure…” – for two years! As soon as Trump takes office – no more waiting – they will normalize. Point is they could have normalized two years ago in which the pain of the unwinding of these distortions would have been felt under Obama – and they didn’t and it stinks of a political partisan agenda.

Headwinds

After eight years of the loosest monetary policy in the history of the United States – the Federal Reserve is going to tighten its’ policy rapidly and severely. After injecting $5 trillion of credit into the economy under Obama – the Fed will now start taking $4.5 trillion dollars off of its’ balance sheet starting this quarter. After raising interest rates once in the eight years of Obama – the Federal Reserve is promising three interest rate increases this year alone.

Is this the morally correct thing to do? Absolutely.
Does it compensate for the eight years of absolute immorality in monetary policy under Obama? No.
Will Trump be assigned the pain this will cause individuals and the economy? Yes.
I know an awful lot of true believers in Trump think an awful lot of economic growth is right around the corner – and maybe it is? However the Federal Reserve gave Obama eight years of the strongest tail wind any President ever received – and he never even hit 3% annual growth in GDP.
The same Federal Reserve is about to give Trump among the strongest headwinds any President has yet received.
Trump and the GOP will have to severely over perform in order to meet even moderate expectations.

Why The Healthcare Bill Matters

I shared the quote this morning from Thomas Massie – “If [Trump] becomes establishment, then the next revolution is not going to be at the ballot box. I mean they are literally going to be here with pitchforks and torches if electing Donald Trump didn’t change anything. What the hell is going to change anything? That’s what I think may be the next step.”

What he said matters and here is why it matters – and why things like the healthcare bill matters. I did not vote for Trump (I didn’t vote for anyone for President because I didn’t think any of them should of been President) but I want him to do well, I want him to succeed for exactly the reasons Massie explained above. When Trump does the right thing I will applaud him, when he does the wrong thing I will say that too. If Trump cannot succeed in changing the culture, changing how government goes about its’ business, ‘draining the swamp’ as it is now being referred to – then I suspect we are doomed as a national entity.

The healthcare bill that was shot down matters because it did not repeal – but it matters much more because it did not change the paradigm. This is what Massie is getting at. If we do not change the paradigm we are done.

If you liked or agreed with the healthcare bill or hated it – take a step back and understand there was and is much more at stake here than simply a healthcare bill and what that bill did or did not do. What is at stake here is the genuineness of draining that swamp and changing that paradigm. Everything else that is proposed to come next – massive deregulation, reducing the bureaucracy, tax reform, renegotiating the debt limit, infrastructure – is going to be much more difficult than this healthcare bill was to get passed.

 

Much more difficult.

There needs to be genuine authentic massive change from and in DC. If there is not – and if it is not tangible and soon – I have little doubt that change will be forced upon us and them. I have particular grave concerns with Trump’s pledge not to address entitlements and hence the debt and all of its’ attendant problems and policies.

I understand the ‘this is what was politically possible’ argument – I would just point out that this argument has a limited shelf life which I think is close to expiration.

You really need to think through what Massie said – “I mean they are literally going to be here with pitchforks and torches if electing Donald Trump didn’t change anything. What the hell is going to change anything?” You may love Massie or hate Massie but if things are not substantially different, if the paradigm has not changed, then two or three years from now I am pretty sure change will have started to be forced through means other than politicians in DC.

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