This is my best blog post ever ... I wish I wrote it. All credit belongs to Ross Rant. Here's a link to subscribe to his newsletter.
The political theater is done. Now maybe the country can move on. Article II section 4 is clear, there never could be a constitutional trial of a person who was not an official. That was why Roberts refused to officiate. Pelosi waited too long to send it over, and when she did, the Senate was in recess and there was no possible way to get it back in session before January 20. Lawyers always taught me you have to stay within the four corners of the document. The constitution is completely clear. You have no authority to try a private citizen, but only an official. End of story. Trump is gone now, so maybe they will let the country move on, or maybe some US Attorney in DC will file charges of accessory after the fact, and start the whole fiasco all over again. .
Here is some data that is illuminating, and will provide good perspective. Unemployment is heavily concentrated in certain states, and in a few job types. NY, San Fran, Vegas, and Boston had the worst unemployment by far. NY Metro has 1 million unemployed-10% of total-NY has 6% of US population. Vegas was due to nobody traveling and being close to 100% dependent on tourism. The best stats were Austin, Dallas, Phoenix and Atlanta where there was not the massive shutdowns. Hospitality was responsible for 3.7 million lost jobs, 37% of total, followed by government 1.26 million, and education 1.2 million for a total of 6 million unemployed-60% of total. So the real issue is not spending $1.9 trillion on a wide array of left wing wants such as $5 billion on homeless-mainly in CA and OR and Seattle, or tens of billions on “climate change things, etc. that have zero to do with the virus, and none of which will help the economy return to normal. For further perspective the number of people unemployed in February before the shutdown with a 3.5% rate, was 4.4 million. So if there are 10-12 million now, that is not the total number who we need to get reemployed. It is more like 4-5 million jobs, an achievable number by late summer if everything including schools are reopened soon, and we get to mid-May with vaccine administered.
I don’t have data to prove this, but just anecdotally it is my sense that many companies are doing very well, and when the economy fully opens things will really hum as CA, NY and IL let hospitality reopen. Earnings for the Russell 2000 have been excellent, suggesting that mid-sized companies are doing well. Just take Anaheim. If they would let Disney reopen, thousands of jobs get reinstated not just at Disneyland, but at the hotels and restaurants in the area. If NYC let restaurants reopen fully, hundreds of thousands of jobs return. And now there is a public news report that Biden actually has considered a ban on travel into and out of FL. I would love to see that one tried.
In case you missed it, oil is just below $60, up from $35.79 on Oct 30, and $10.01 0n April 21. Low income people just got the equivalent of a big tax increase, so Joe’s answer is shut down fracking and the pipeline. Makes perfect sense.
Savings data breakdown: the top 80% of taxpayers saved 75% of the excess savings and the 60%-80% cohort saved 10.2% but spends 20% of all personal outlays. The bottom 20% saved 3.5% of excess savings and account for 3% of personal outlays. In a new survey, people making under $50,000 said they saved 17% of the last check and will save 29% now , and people making over $100,000 saved 41% of the last check. So as is logical, the wealthy top 20% saved the most because they have the most excess disposable income, They will likely use these savings to invest, or donate to good use. The bottom 20% is able to save excess to their norm which means they are doing OK on average, and the mantra from the Fed that they don’t have $400 saved is likely not true, as several analysts have contended. What is of note is that few need the whole $1400, so it is a waste which is why some Dems agree they should lower the income levels.
The real solution is to get as many people vaccinated as possible, as fast as possible, and get schools fully reopened 5 days a week, not one day a week, and end all lockdowns which have now been proven to have caused far more problems than they solved. As of now, around 50 million have had at least one shot. That is more than all the Covid positive tests to date. Mid-February. They are doing 1.66 million a day and ramping up. Let’s just use 1.5 million. By May 1 that is 113 million more. Over 30 million are immune because they had the virus. That is a total of 143 million had at least one shot, or had the virus, and most of the number will have had a second shot by May. Now add J&J starting March 1. So add a minimum of another 30+- million, total now 173 million. Add kids under 18 or 72 million more= 245 million by May 1 that are low risk or immune. That is more than 75% of the total population. Kids will get vaccinated over the late summer. If almost all nursing home residents are vaccinated, as they will be, and most very vulnerable co-morbidity people, the hospitalizations and deaths by May 1 will be nominal. Less than in a normal flu season where 60,000 on average die. The government and press are hyping this with constant daily, oh my God this is terrible pronouncements. Reality- the US has already given 30% of all the shots across the world. We are doing great by comparison. Stories in the press are always about some minimally educated single mother with 2 or 3 kids who can’t pay the rent. Her issue is not the virus, it is bad life choices. It is all political. The White House admits this is all about 2022, not about solving the real problem. Saying one day a week to have schools open is not having schools open. It is cover for the teachers unions. It is outrageous politics instead of kids welfare. If they did what I have laid out above there is minimal need for another wasteful spending program which has tens of billions for groups favored by the White House. It will not create jobs. Only the private sector being fully opened will do that. Clearly the White House is counting on, if they give away enough free money to voters, they will combine that with the impeachment hearings, and be able to win in 2022. That is what is really going on. You add on HR1, and the Dems believe they will retain complete control of DC for years to come.
In case you are delusional to think $1.9 trillion is going to the needy workers, or to the poor, or to good use, here are just a couple of examples of the many things in the $1.9 trillion- $300 million to migrants-I assume to give money to illegals coming across now, $5 billion for the homeless-I guess we pay then to take drugs and live in tents, $20 billion to USPS-instead of fixing the system, $300 million to Endowment for Arts, $300 million for Endowment for Humanity-never heard of this one, $30 billion Dept Of Education-they already have a large budget, $300 million to NPR (devoted to Democratic views), $25 million of cleaning supplies for the capital (That is a lot of toilet paper), $520 million for ADMIN costs for Social Security-maybe they are going to hire a whole additional staff, $1 Billion to Amtrak, $13 million to Howard U-racial equality feel good stuff. Supposedly, only a relatively small amount is actually to do with Covid, or to people who actually need it, but the mantra is, if they don’t pass this the economy will collapse, and people will be in the street starving to death-or that is how they make it sound. Maybe they can house the poor in Kennedy Center. This is just a partial list, but Biden claims we need the $1.9 Trillion to save the economy, and for the suffering voters. Keep in mind the bipartisan Problem Solvers said they had a bill for half as much that was targeted, and McConnell had one for $600 million that really was targeted to Covid. As Everett Dirksen famously said- a billion here, a billion there, and soon you are talking about real money. Think of it this way, only 50% of Americans pay any federal tax, so the cost of a $1.9 trillion bill for actual taxpayers is $12,102 per taxpayer. The 49% who think the $1.9 Trillion should be approved have no idea what is really in the bill. They only think they are going to get another few thousand in their bank account. Apparently some voters in GA are now angry because they are not going to get an extra $2000, but only $1400 because that was why they voted for the Dems. Just in case you still have any delusion about what all of this waste of money is really all about. Buy votes. And they are just getting started according to Biden. None of this is gong to create any jobs in the private sector.
I have read various articles that surmise that the political crowd, the press and the elites in DC and Silicon Valley were happy to take advantage of the virus, and make it into more than it really is. The elites in DC used it to go after Trump again. The press used it to go after Trump again. Silicon Valley saw it as a massive opportunity to make billions, and the health elites saw it as an opportunity to claim their models and what they perceived as intellectual superiority, ruled the world. The teachers unions saw it as an opportunity to cash in with big payoffs from cites and DC in the form of money that gets eventually translated into higher salaries and pensions since their pension programs are all gong insolvent. That is what is really behind the school shutdowns. I doubt any of these people conspired actively to collude on any of this, but they each seized on the opportunity to make it work for them, and we all paid a horrible price. The minority kids paid the worst price of all. Their lives are seriously compromised if they live in a big city and cannot get in to a Catholic or charter school. The world has had pandemics before, and never a total shutdown. The damage to the world, other than to China, has been horrific. Many people died who would not have, had they been able to see a doctor, and many small business owners would still be in business, or stay and their staff employed. We will never know the real number, but it is clear to me that it paid $2000 per death for hospitals to say it was Covid, and not the real underlying cause of death like cancer or heart. This may have been to the worst catastrophe in US history and it did not need to be if the health experts like Fauci had used a much more all-encompassing analysis to make determinations on shutdowns, and if the teachers had not been greedy. Had they moved immediately to totally isolate nursing homes, and mandated masks and distancing, in January or February, we could have avoided much of the worst ramifications. We now constantly hear Trump being blamed for not having everyone already vaccinated. Reality as I have said before. The vaccines were just approved 90 days ago. Around 50 million are already vaccinated. You can only produce it under very strict conditions so it takes time to roll out which is what they said. Many states are simply incompetent when it comes to such a massive logistics challenge, so some states are a mess. The US is so far ahead (14% vaccinated) of the rest of the world, (3.7% in the EU), other than UK and Israel, it is not even a comparison. But Biden and the press blame Trump, when the real issue is everyone wants their shot yesterday, and there are unrealistic expectations of how fast all this is possible to happen. Were it not for Warp Speed there would be no vaccine.
A ten year today yields you around .7% after tax depending on your state. Plus you will have a loss of principal. Despite the best efforts of the Fed, rates will slowly rise from here. It is likely that in 2021 earnings will be very strong in 2H of the year so you should be much better off in the stock market for now. Low rates equal higher P/E ratios plus higher earnings means higher stock prices in the short run. However it also means everyone is further out the risk curve the further into the year we go. Low rates means many can’t retire on their CD or annuity, or on their bond yields. That combined with better health, keeps more old people working and fewer jobs for young people. The real issue is real rates on the ten year are negative. Just for perspective, Airbnb is worth more than Marriott, Hilton and Hyatt combined. Door Dash is worth more than Wendy, Yum and Dominos. Tesla is worth more than the major auto companies. Some day this all has to get rectified by the market. Junk bonds now yield below 4%. That is really out the risk curve. Companies with a lack of liquidity should be out raising all the junk debt they can right now with the longest Term possible. Powell said inflation has been low for several decades and so we should not be fearful all the stimulus will increase inflation. Problem is he ignores we never had zero interest rates before, and that matters. One day this massive bubble is going to burst big.
Key stat. The VIX is at the lowest its been since February1. It is at 19.97. It had hit 85.47 on March 18. This means fear is out of the market right now which is good for higher stock prices. Some of us have long term fear.
The press fell all over themselves to compliment Cuomo and tout him vs Trump. Now we find out there was a major coverup of the truth about nursing home deaths so Cuomo would look good and not have the DOJ find out what was really happening with all those deaths. It will be interesting to see how the press deals with Cuomo now. He should be in jail as he directly caused 15,000 deaths. What do we hear out of DC- crickets./ So now we have this in NY, and the possible recall in CA. Maybe all is not lost. The CA recall will be very telling. The two top governors in the Dem party, and the biggest shutdown advocates are possibly going to be thrown out of office for their incompetence. If Cuomo gets to walk with no legal repercussions it will make the whole system a corrupt joke. Now Biden is nominating the woman in charge of CA Labor Dept as deputy Labor Secy. Under her leadership CA has had over $30 Billion in fraud in the unemployment payments just in 2020. Sounds like a good choice to me if you want complete incompetence and waste. Keep in mind that the White House has said they are going to use CA as their template for how to do things. Ironic if anything ever was.
Biden expects to work with the EU in confronting Russia. A few days ago, at a public press conference, Lavrov, foreign minister of Russia, lambasted the EU as “an unreliable partner” while the foreign minister of the EU was standing next to him. Now Lavrov has said if the EU imposes more sanctions Russia will go it alone. Good luck Joe on your foreign policy that has hit a wall everywhere, from China, to Russia to Iran, all in just 21 days. And now the White House has refused to say Israel and Saudi are important allies. “It is under review”. And now they intend to go back to funding the Palestinian Authority where the money gets corruptly stolen. Great message to Iran and Palestinians. The Dems lambasted Trump for stopping support for WHO because they covered up for China. Biden rushed to rejoin. Tis past week WHO again covered up for China and claimed the virus did not come from China, even though they never were given the information they requested and needed. Now Biden is “very concerned” about the WHO investigation. Pompeo says there is little doubt it came from the lab. Now Biden looks like an idiot.
It is notable that Biden sets goals, like 100 million shots in 100 days, or 50% of schools open one day a week, when the goals are already more than achieved-schools- or they are well on the way to be over achieved-100 million shots. So the game is set very low goals that they later can say look what we over achieved. It is setting the tone for what we can expect over 4 years.
This one will blow your mind. OR now has a new training manual for math teachers. It teaches that math is not to be taught to get the right answer, as that is a characteristic of white supremacy. ???? I guess I am a white supremacist as I believe we should always strive to get the right answer to a math problem. It tells teachers “There should not be a focus on math being an objective subject with only right or wrong answers, and to teach that perpetuates fear.” Huh?? It tells teachers to come up with two right answers to math problems to promote “equitable outcomes for black and Latinex students”. In other words, minority students get to have a good grade for wrong answers to 2+2. Maybe it is really 5 or 6 in this new race based math world. The manual for teachers states that there is no right or wrong answers in math. There could be various answers to a math problem. That is news to mathematicians since a few thousand years ago. Teachers are told to find ways to “show how math is used to promote capitalist, racist and imperialist views”. I am not making this up. We have hit such a level of absurdity that it is really scary that wrong answers in math are OK if you are a minority. It actually is as racist as anything since it clearly implies that minority kids can’t always get the right answers so the goal is to make them not feel bad by letting them give wrong answers. And then they wonder why black kids often get bad educational outcomes, and can’t succeed in the real world where 2+2=4. How are black kids ever going to be successful if this is how they are taught.