Posts filed under “Politics”

Deal Done!

Deal Done!
David R. Kotok
October 16, 2013



Deal done!

Lesson 1. There will be no default. Disgraceful, divisive Democrats and ridiculed, repugnant Republicans, who share blame equally for this horrendous example of poor governance, are aware that the country must not default. They agree on that. So, no default!

Lesson 2. Government must operate. Defense, healthcare as in CDC flu shots and the control of tuberculosis and salmonella outbreaks are essential services, too. So are the disbursal of disabled veterans’ benefits and the provision of public education and a million other things. Enough of this crap. The country has had it with failed governance. If our memories don’t get hijacked by the issues and diversions that intervene, we are going to be angry next year at the polls and throw out a few Democrats and a few Republicans and replace them. Will we remember? When people think back, will they recall this fall’s political debacle – or the baseball playoffs? We shall see.

Lesson 3. Listening to the political rhetoric from the Senate is enough to make me puke. They made this mess. They haven’t passed a budget in five years. They set the stage for this debacle two years ago with the Budget Control Act. Now they are claiming credit for resolving a mess they created. Damn.

Lesson 4. One Senator who filibustered for 21 hours succumbed to criticism. He also raised an enormous amount of money during his day of fame. He may have put his political party in the hole for next year’s elections. Time will tell. Senator Ted Cruz, the Tea Party candidate for president, has done a huge disservice to the country and his political party, while serving his own interests. Think about it. The party that sought Obama’s birth certificate now wants to amend the constitution so a Canadian-born citizen can be president. Do you smell an inconsistency there?

Lesson 5. Markets are willing to look across the valley of the shadow of default and see that the fundamental fabric of our great America remains intact. We are still the best place to be on this planet – although sometimes we are the least worst. This is our system. We own it. We also own our complacency, because more folks will watch the baseball playoffs than will focus on shenanigans in Washington. Can we get angry and stay angry enough to throw many of these bums out? Time will tell.

At Cumberland Advisors, we are fully invested and expect the S&P to cross 1800 before spring. We expect the Fed to put tapering on hold until they see recovery from this setback that Washington created. These are our assumptions.

We also expect another round of reprehensible behavior from the miscreants in Congress in the coming months. So be it. That is our American way.

Lastly, allow me to share my favorite fantasy with regard to the political madness we just endured. It was that the idiots on the Hill completely failed, and then Social Security payments didn’t go out. Then millions of grey panthers stormed congressional offices and got up from their wheel chairs and beat the living ____ out of their congressmen and -women with their canes, in the same way that they beat Congressman Rostenkowski in 1979. I fantasize a 75 year-old’s breaking a cane over the head of a member of Congress while shouting, “You are supposed to work for me and you failed me and I have had enough!” Somehow that is an image that warms the cockles of my heart.

We will not see that happen. But we can know that the fear of a backlash is something that motivates these characters we elect to our government. Dems and Repubs, thanks a lot for dragging our nation through this crisis. Shame on you.

This time, our American societal and institutional fabric withstood the shock and now moves on. That is what we do.


David R. Kotok, Chairman and Chief Investment Officer

Category: Politics, Think Tank

Who Goes to Work? Who Stays Home?

Click for interactive graphic Source: NYT

Category: Employment, Politics

How the Government Pays Its Debt

Click for interactive graphic Source: Washington Post

Category: Politics, Taxes and Policy

The Obamacare Portfolio

On Investing: The Obamacare portfolio By Barry Ritholtz, October 6, 10:11 AM       Investors are best off when they leave their party affiliation and partisan views behind. I’ve said it before: “Washington, I’m here to tell you, politics and investing don’t mix. Your politics are killing you in the markets.” Keeping your emotions…Read More

Category: Apprenticed Investor, Investing, Politics

All Holders of U.S. Treasury Debt

Everyone The U.S. Government Owes Money To, In One Graph broken down by category and by how much government debt they hold   Source: NPR

Category: Credit, Digital Media, Politics, Really, really bad calls

Look Out Below, Government Shutdown 2nd Week edition

click for updated futures   US Futures are deep in the red, as we begin the third second week of the government shut down. In theory, some 25% of the US economy may soon end up off line. We are not there yet, but that is the short term negative. The worst case scenario is…Read More

Category: Markets, Politics, Really, really bad calls

ObamaCare: Investing Advice for Senator Ted Cruz

>   My Sunday Washington Post Business Section column is out. This morning, we look objectively at Obamacare — not the politics of it, but the investing aspect. Its called: On Investing: The Obamacare portfolio. My conclusion? If you were an objective observer of the legislation when it passed, and then again when the Supreme…Read More

Category: Apprenticed Investor, Politics, Psychology, Really, really bad calls

How to Bypass the Debt Limit

click for video
Bypass the Debt Limit
Source: Yahoo Finance

Category: Currency, Politics, Video

Obama to Harwood: “Wall St Should be Worried”

Category: Politics, Video

America’s Fiscal Path, 2009-13

America’s path from fiscal improbity to political impasse Source: Economist

Category: Digital Media, Politics, Really, really bad calls