Mr President, I Have A Question

The longer that the Trump economy continues to flail around like an electrocution victim, it’s obviously becoming a bigger pain in Donald Trump’s ass than Robert Mueller, Chuck Schumer, and Nancy Pelosi combined. That’s for the simple reason that Mueller, Schumer, and Pelosi were flesh and blood adversaries, and as such he could attack them freely. He has anchored himself to the economy so tightly that he can’t call it nasty names, or blame it for anything, instead he has to blame other things for it. The first quarter GDP number was like a bugle going off in a cemetery, and the weekly and monthly unemployment numbers are starting to sound an awful lot like dirt thumping on the lid of a casket. But this is the hand that Trump has dealt himself, and I think the poker term for it is a kangaroo straight, but it’s he has to work with. Trump’s biggest problem is that if there is a single human being on the planet more piss poorly qualified to play Liars Poker, I’ve yet to see him or her. But still, Trump is giving it his best shot. He’s settled on a strategy for dealing with the economy with the media now, and at least for the moment, he’s sticking with it. Here’s his latest snake oil spiel, Things are going to turn around in the third quarter, the fourth quarter will be even better, and then next year the economy is going to completely take off. When dealing with a political nincompoop like Trump, this is almost absurdly easy to decipher. The third quarter consists of July, August, and September, and that’s basically the ball game for Trump. Those numbers will come out in October, and if they’re a miserable flop, Trump loses any prayer of using his economic stewardship as a stepladder for reelection. His reference to the fourth quarter will become obvious when he starts wrapping that phrase into his stump speeches, an obvious reference to the stock market taking off like a rocket ship with his reelection. And his rosy prediction for next year is a thinly veiled plea to give him four more years to sink further into dementia. But when Trump speaks of next year, he keeps gilding the lily with a statement that makes absolutely no sense at all. He prattles on that The economy is going to go through the roof next year. And I know that because of the pent up demand. I’ve never seen so much pent up demand before in my life. It’s unbelievable. Which begs my very simple question for our economic Savant in Chief, Pent up demand for what exactly, Mr President? See, the whole thing with demand is that in order to be effective as an economic stimulant, it has to be a demand for something that is either barely in adequate supply, or of which there is a shortage. A shortage creates economic stimulus because manufacturers have to hire more people to make more of the shit that’s in short supply more quickly, and the increased sales pump money back into the economy. I get all of that. So, what exactly is this miracle product that the nation is clamoring so piteously for? Surgical masks? Rubber gloves? Suntan lotion for a week at the beach? A belt with sharp tipped 6′ aluminum spikes studded on it to ensure your personal space in the era of social distancing? The things […]

Want To Screw Up A Small Business Bailout? Use Big Banks Of Course!

The logo on the seal of the city of Chicago is “Urbs in horto” which means “City in a garden”. Local historians believe it should be changed to “Ubi est mea” which means “Where’s mine?”   Mike Royko   Boss Although obviously well intentioned, the congressional bailout for small businesses has been beset by problem from the word go. Just before the first round was released, I covered an exchange in which a GOP congressman on the oversight committee was asked how one committee could effectively oversee a half a trillion dollars. His reply was that the first priority of the committee was to get money into the hands of small business owners as quickly as possible, and the fact that there would be a small amount that was misappropriated was a given. I took this as a tip off on how His Lowness would try to line his pockets from the larger, less regulated slush fund that Treasury Secretary Steve Mnuchin controls. Results are still out on that one. But since the get go, the payroll protection plan has been beset by problems, some simple flaws in the verbiage of the law as opposed to real world conditions, and some more openly insidious. But there is one problem that stands out over all. Let’s take a look at some of the smaller ones, and then the gonzo problem. One problem became apparent immediately. Many small businesses do not have the kind of cash flow that puts them in regular contact with big banks, they use smaller local banks instead, which makes sense, as it keeps the money in the community. But the Treasury Department put the loan application process in the hands of several major banks, which meant that larger, in some cases national chains claimed millions, in some cases tens of millions in loans while the smaller business were having their loan applications picked over with a fine tooth comb. Once that glaring error was exposed, the Treasury Department set about going through the process of clawing back those funds from the ineligible companies, and put new restrictions on the process. Also, the law requires that if a small business is going to get their grant forgiven, they have to spend the money with 75% going to payroll costs, and the other 25% going to rent on the business. The law also requires that employees be back on the payroll by June 30th to qualify for grant forgiveness. But due to local conditions, and the very nature of some small businesses, they may not be able to reopen by June 30th, which would forfeit their ability to have the grant forgiven. Also, for some owners with higher rent locations, reopening at a reduced profit would not allow them to make their rent payments being able to use only 25% of the grant for that purpose. But the biggest problem with the application of the law falls back to the lowest common denominator, pure and simple greed on the part of the banks that are administering the loans themselves. The banks are not processing these loans out of any sense of civic engagement, they are being paid for doing it. They charge an origination fee for every loan that they process. This isn’t unreasonable, except for the fact that the origination fee is a percentage of […]

Trump Is Preaching To The Wrong Choir. Again.

Since the earliest days of the Trump presidency, he has based his entire economic platform for the American public on what basically amounts to a street corner game of 3 card Monte. Almost immediately after being sworn in, Trump touted the sharp rise of the stock market as a sign of his economic genius. Trump chose the stock market for a very good reason. The daily numbers are easily and universally available, everybody knows that the stock market is, and even an economic dunce like Trump could take credit for the rising numbers. Self congratulations on the state of the stock market became a mandatory feature of his stump speeches. There is one small problem with that economic theory. And that’s the simple fact that only a minority of Americans actually partake of the roller coaster of Wall Street with their own money. But Trump had the solution to that problem. The vast majority of Americans do participate in 401k programs through their work. So, for simple minds, Trump irrevocably tied 401k’s to the stock market for everyday Americans. Every rally speech contained a segment that went something like, Have you seen the stock market lately? Not! Another record high! How are all of your 401k’s doing, huh? Now, aren’t you glad that you voted for Trump? This was nothing more or less than a pure pea-in-the-shell game. Forget the fact that the increase in their 401k’s did nothing whatsoever to increase their disposable income, due to the fact that they would have to wait years, many even decades before they could tap into those resources. Trump cynically conned ordinary Americans into believing that they were somehow better off today because they might have more money in the future. There has always been a healthy disconnect between the stock market and the general mainstream American economy. Most of the money in the stock market comes from heavy hitting institutional investors, and is overseen by an limited number of powerful traders and brokers. Investing is nothing more than a series of educated guesses on the future performance of a particular company or asset. The money in the market tends to stay in the market, it simply moves around from place to place. This is why the Dow can be at 30,000 and yet the majority of Americans haven’t seen a significant pay raise in 5 years. But the economic Dunkirk being wrought on the US economy by the draconian stay-at-home measures brought on by the virus are finally shining a bright light on the fallacy of Trump’s whole economic argument in the first place, and the vision is stark. If you want to talk about a disconnect, how about this one. Right now, the Dow is more than 4,000 points above the low it hit in the middle of the crisis, and yet there are more than 25 000,000 more Americans on unemployment now than when the Dow was trading at under 18,000. In what sane, everyday world can you reconcile these two numbers? Trump’s whole push to force governors into reopening their states to resume economic activity is a desperate ploy to get the stock market moving upwards again, because that’s the only way that he knows how to talk about the economy! But it won’t make Any. Fucking. Difference. Let’s just say that the market bounces up, oh, I dunno, let’s say a grand as […]

The Reopening “Salvation”

Well, here we go, just another chapter in The American Experiment. Although this one is already looking, before it really starts, like a 3 year old trying to make Mothers Day. Several GOP Governors are running head first into a wall in trying to reopen their states for business, and the consequences be damned, all to satisfy the Great Pumpkin. If you want a sneaky-peek at what’s likely in store about a month ago, look no further than the great state of Wisconsin. On April 7th, the craven power sluts of the GOP forced people to stand in line in order to vote in a special election. And less than three weeks later. there has been a spike in coronavirus cases, with the health department in Wisconsin specifically asking confirmed new vases if they voted in the special election. But here’s the really shocking thing, the Wisconsin special election was held under controlled conditions to try to minimize the risk. People had to be wearing masks to stand in line, all poll workers wore masks. People standing in line tried to observe social distancing while in lines, hand sanitizer was provided, and machines were regularly wiped down. These GOP governors are basically throwing the civic version of a frat party kegger, and hoping that the alcohol kills off the virus. Fortunately, there is a single salvation in the midst of this potential madness. And that is the fact that it is not El Pendejo Presidents, nor his dim witted Governor minions, nor even his big business contributors or Wall Street that will determine when the American economy reopens for business. It is the American people who will decide when America reopens for business, and fortunately, most of them are showing that they are much more intelligent than the numbskull GOP governors who are trying like hell to con then for the sake of a political agenda. Results from small businesses reopening their doors at the first opportunity are mixed at best, based on available reporting. The number one reason behind reopening this quickly is I need to pay the bills. But to me, this sounds like a second marriage philosophy, eternal optimism in the fact of harsh reality. Even states with liberal reopening policies are restricting businesses to 25-33% of normal capacity. A lot of these places are at best moderately successful under optimum conditions, even with reduced staff, how do they hope to survive on starvation occupancy? And reporting I’ve seen show barber shops doing passably well, but most other businesses seem to be seeing light, if any patronage. Manpower is likely to be another obstacle these newly reopened businesses face. When most of these businesses closed, their employees took a luxury cruise of Charon’s Boat in trying to navigate the serpentine system to begin collecting unemployment. Some of them quite likely do not feel particularly safe in coming back to work under such shoddy safety protections required by the states. And many more of them are probably unlikely to give up the bird-in-the-hand unemployment they already have to go back to work, only to have the place shut down again in a month, and have to start the process all over again. And there’s no indication that big business is on board with this rush job to save Trump’s economy. My wife works for a national clothing chain. When we shut down […]

Trump Just Doesn’t GET IT!

I’m not going to go into another rant about the hysterical nonsense spewed forward today by El Pendejo Presidente, yesterday’s article nearly gave me a brain embolism. But there is a fundamental flaw in His Lowness’s logic regarding the economy that I really believe needs to be cleared up. It is now clear that Moronicus Maximus has his heart set on a glorious Easter Sunday rebirth of the American economy, kicking off with a magnificent return to normalcy. As Lawrence O’Donnell put it this evening after Trump’s idiotic FUX News town hall, Americans have to decide whether they want to die from the corona-virus, or by mass suicide form the dent to their 401k’s. Glorious Bleater is dead set on restoring the stock market to it’s previous heights to prop up his faltering reelection hopes, but he’s forgetting one simple thing. And that is the fact that Wall Street doesn’t drive Main Street, Main Street drives Wall Street! Here’s a news flash for The Pampers President., The recession is here! Deal with it! A 10% drop in share prices from a previous high indicates a “bear market,” the Dow has lost basically 33% in the last 40 days. In the Great Recession of 2009, we lost 2 million jobs in 3 months, we’re likely to lose close to 3 million in a single month. The federal Reserve Board can dump unlimited amounts of money into the markets to stabilize bonds and ensure liquidity, but they can’t create consumer confidence. Trump delusionaly continues to believe that restoring the stock market to an upward curve will fix everything. But it won’t. Trump continues to believe that he can will an economic recovery by forcing people back to work. But that won’t work. In The Great Recession of 2009, unemployment capped at 10%. Economists are forecasting that unemployment during the corona-virus pandemic could cap out at 20% or higher. Those who become unemployed that are not financially destroyed will burn through a large portion of their “nest egg” to keep from doing so. And those that remain employed and collecting a check are fearing that they’re one numerical downturn from becoming unemployed. Basically, everybody is scared shitless. There’s an old adage that every American alive has heard, You can lead a horse to water, but you can’t make him drink. But in he age of the corona-virus pandemic, there is a derivative of that old adage that Trump should be aware of, you can lead a consumer to Walmart, but you can’t make them shop. Y’see, that’s the nub of it right there. By the time that this pandemic is over with, I roughly guesstimate that 65-70% of Americans will have felt either a personal financial drain from this epidemic, or suffered a severe lack of confidence in the stability of their jobs as a result. When this is finally all over, those that went to the razors edge will be frantically trying to rebuild their dissipated savings, And those lucky enough to have kept their jobs during the crisis will be terrified that the resulting recession could end up costing them their jobs. To put it bluntly, Ain’t gonna be nobody spending shit! This is the real problem with Trump’s nearsighted myopia. Because it is the most visible sign of economic wealth, Trump insists on seeing the stock market as the know-all-and-end-all. But for the stock market […]

Too Little Too Late? More Like Too Much Too Early.

OK, I already spent an entire article devoted to The Madness of King Donald, in which I ridiculed his specious and petulant tantrum about the slow progress in fighting the corona-virus, as well as the reelection chances it was costing him. I keyed in on his childish and selfish desire to return the country “to normalcy” by nothing more than a foot stomping personal fiat. But let’s look at that more seriously for a moment, and take a moment to think about the mechanics as they are right now, and what they would be if Trump got his way. This is a critical matter for Trump, as he feels that his reelection chances require a return to normalcy, and at least some stabilization of the market as soon as possible. But what if his precipitous actions would actually make things worse rather than better? Let’s just take restaurants, the life blood of American small business, as an example. Right now, many restaurants, and pretty much all bars and lounges are shuttered. The ones that remain open are for pick up or delivery service only. So what happens when a restaurant is closed due to something like the corona-virus pandemic? Well, of course, people are laid off. There is no need to have employees when the shop is not running. But what does that mean? For one thing, expenses for the restaurant go down. The electric bill goes down because the lights are no longer needed. And if the owner doled out the perishables, such as bread, veggies, lunch meat and cheese, milk, then the reefers can be turned off. The gas bill goes down because the ovens and burners are no longer in use. The water bill goes down because dishes are no longer washed, and the toilets are no longer flushed. The garbage pickups can be canceled until further notice, along with all new food deliveries. All of these things help to lessen the outgoing expenses to keep the place viable to reopen when the crisis is over. Now, there is one critical thing that must be remembered here, and that is that the credibility of the Trump administration is jack fucking shit! Trump’s buffoonish behavior and childish petulance have stripped the administration of their last shred of dignity or respect. And let’s not forget, His Lowness can proclaim anything he wants to, but it is up to the Mayors and Governors of the states to decide when to lift restrictions in their own domains. Trump’s imperious proclamations have no valid force of law presumption. But, just for the sake of example, Governors and Mayors go along with Trump in return for some future quid pro quo. They go along and herald a return to normalcy. What happens then? But only the restaurant owners, but the people who will frequent them, have been given nothing but conflicting information. A desperation for a return to the good old days takes hold, but who do they believe? Do they believe anybody? Let’s just say that a small restaurant owner drinks the koolaid and decides to reopen. What does that mean. Well, 1-2 line cooks, a dish washer, probably a bus boy,and 1-2 waitresses along with the manager. The lights are back on, the reefer is back up and running, the reefer and freezer are stocked, as is the produce bin, the garbage […]

Express Elevator To Hell

You know, there;s one thing about dealing with the devil. He’s generous with his money, and he offers great terms, but sooner or later, he collects souls for interest. And right now, I think that Trump is hearing a knocking at the Oval Office door that has just a strong whiff of brimstone to it. The market giveth, and the market taketh away. The best description of the market I’ve ever heard was from Queen, when they sang in Bohemian Rhapsody, easy come, easy go. Little high, little low. And one of the first pieces of advice that a normal president, you know, one with an actual IQ, receives is, when it comes to the market, leave it alone!  Glorify a strong stock market, but don’t assume credit for it, because sooner or later, the stock market is going to get a sudden fear of heights, and when that happens, you’re not going to want your logo on the tail of the plane. When it comes to the stock market, I think you had better get ready to hear a lot more numbers from the presidential candidates as the race heats up, especially the Democratic candidates, of all stripes, running for all offices. The last I looked, about 10 minutes ago, the Dow Hones is off another 500 points today. I just took a quick peekie-see at the stock market history. You know what the Dow Jones closed at on January 19th,2017, the day before Donald Trump’s hand befouled the Lincoln bible? It closed at 25,615. I just turned the tv back on to check, and as I type this, the market is at 25,636. That’s not a typo. After 3+ years of incredible economic leadership from El Pendejo Presidente, the stock market is up a staggering 21 points.. Simply put, for the last three years, Trump has basically spun his wheels. Normally, that would not be a bad thing, but it is today because of Trump’s PT Barnumesque exaggeration of the stock market, and his role in it. After all, let’s not forget that it was only a little less than a month ago that the market was seriously flirting with the 30,000 mark. This is what Trump has never understood, the simple fact that globalization can make the entire global economy dependent on a particularly virulent form of the flu. There are normally two ways that people watch the market. For most of us, the most popular way is The Big Board. We watch the average number for today as opposed to yesterday. If the market is up by 400, we rush out to buy a motor home, and if the Dow drops 400, we sell our collectible lego action figures in the front yard. Analysts will tell you that this is ridiculous, as the market is in constant flux. After all, nobody’s body temperature is a consistent 98.6. Many analysts and pundits, such as Ali Velshi on MSNBC counsel that what to watch for isn’t the number itself, but the percentage of activity in either direction. Velshi himself doesn’t take any particular alarm until the 3% threshold is crossed. So a month ago, Velshi wouldn’t have worried about anything much less than a 900 point drop. And that threshold has now been repeatedly breached. As it stands right now, His Lowness is boned. Sideways. Because when people look […]

The Yang To The “Big Lie” Yin

You know, Josef Goebbels popularized “The Big Lie” back in the late ’30s. but it took Donald Trump to elevate it to a fucking art form. But finally, after 3 long years, we’re about to find out what happens when reality meets bullshit at 100 mph, and just how much of that shit Trump acolytes will really swallow when the chips, especially blue chips, are literally down. Believe it or not, I actually learned a couple of things from Trump’s press briefing on the coronavirus. First, I learned that Melania’s taste in neckwear is as tacky as her taste in men. Really, Melania? Hot pink before Easter? Second, I learned that HHS Secretary Alex Azar is going for that whole Sebastian Gorka look. Fat chance, Alex, you own him, And third, Trump’s shame quotient is now officially lower than his IQ. There’s Trump, standing at the podium, surrounded by people who have more letters after their last names than Trump has in his last name, and he smoothly and forcefully contradicts every word out of their mouths. Even his HHS Secretary says to get ready for more cases, which is why Trump pulled the rug out from under him live on national TV. But this is a problem, because for pretty much the first time, Trump is pushing bullshit that goes against his own best interest. For instance, we all know that Trump is a paranoid delusional. He shares those traits with his stumble bum base. Normally, there’s nothing that Trump loves more than an impending disaster, so that he can twist it around to worry his supporters to death, and make them rely on him to solve it. And what could be more dire and desperate than a mysterious super virus, for which there is no cure, possibly being dropped from black helicopters? Fits Trump and his supporters like a glove. But it turns out that Wall Street hates the coronavirus.  So while the entire medical community is spreading cautious alarm that normally Trump would be whipping into a panic and blaming on the Democrats, this time he has to sit there and basically call it a hoax, while trying to reassure Wall Street that the Democrats are making a case of the sniffles into a scare tactic for November. I want to see what kind of cheap, third rate quacks Fox News finds that will gleefully violate their oaths in order to go onto Hannity and purposely mislead the public as to the actual risks posed by the virus. And it will be fun to see how long the GOP Senate can go on parroting Trump’s tripe, before they finally start having to peel back and accept reality before their constituents move to quarantine them. At what point do people who have subsisted on pure bullshit for almost four years finally start to tune back into reality before it’s too late. But worse yet for Trump, he’s trying to reassure Wall Street that everything is just hunky-dory. This is bullshit, and Wall Street doesn’t deal in bullshit, it deals in facts and information. And as they learned in the first year of the Trump presidency, when they let his tweets put stocks like Boeing and Amazon on yo-yo strings, bullshit is all Trump has to offer. Wall Street loves facts the way His […]

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