The Biggest Story of the Decade December 5, 2016 When the “Hamilton” cast made its respectful plea to Vice President-Elect Mike Pence, it was huge news. (Whatever you think of their having done so, hats off to Pence for the gracious way he brushed it off and made a point of praising the show.) When the FBI notified Congress it planned to sift through yet more emails — having found nothing in the first 45,000 — it was a “bombshell.” But when Russia was revealed to have massively meddled in our election through acts of espionage and disinformation, it was ho-hum. Yet Senate Intelligence Committee member Angus King calls it “the biggest story of the decade.” . . . I happened to be in Eastern Europe last spring with a group from the Intelligence Committee in Ukraine and Poland. The officials there took us aside, and warned us of this. They said this is what Russia does. They mess around with your elections. They put in fake information. They hack into your systems, and they’re trying to sow discord and influence elections. And we talked about it. We understood it. We didn’t think it was going to happen here. It has happened here. Per the Portland Press Herald . . . Angus King: Russian involvement in U.S. election ‘an arrow aimed at the heart of democracy’ . . . On Wednesday, King was among seven senators – all of whom receive top-secret briefings as part of the Senate Intelligence Committee – who urged President Obama to authorize the public release of additional details on the alleged Russian involvement in the recent elections. The request comes amid growing evidence compiled by independent researchers and cybersecurity experts about the extent of Russia’s alleged use of hackers, social media and fake news stories in a bid to influence the race between Republican Donald Trump and Democrat Hillary Clinton. . . . The tragedy, of course, is that these revelations will have come too late to do much good. Russia won. They helped install their preferred candidate to lead our country. Even though, through the quirks of our system, he got 2.5 million fewer votes. (And even though, according to one pollster, 25% of his votes came from people who — knowing for certain he had no path to 270 electoral votes, because that’s what the media assured them — voted for him to make a statement, but would not have if they had thought he might actually win. If that’s true, and had they voted for Hillary instead, the vote would have been something like 47 million for Trump, 80 million for Clinton. Even more if some Jill Stein and Gary Johnson voters would have voted Clinton if they’d thought Trump could win.)
Stock Updates December 2, 2016December 1, 2016 I don’t want to shock you, but I’m going to write something about money. Specifically, four stocks I’ve discussed in the past. But first, by way of thanks for your subscription, free tickets to an off-Broadway show that I’ve also discussed, “Buyer and Cellar” (“Delicious and wickedly funny!” — New York Times) . . . which I’m able to provide because it’s being broadcast and live-streamed Monday at ten, as explained here. Enjoy! Also: the Nick Confessore piece everyone is reading, in case you might one day want to hide $400 million from your spouse. It’s one more window into the ever-increasing wealth inequality Ronald Reagan set in motion and that Donald Trump — whose Cabinet picks’ net worth so far averages about $200 million and whose proposed tax cut is 14% for the top 1% but 2% for the middle class — has persuaded millions of voters he will reverse. That those voters may be disappointed is a pretty good bet. Chris Brown shares this quote from Chrystia Freeland’s 2012 book, Plutocrats, writing about how they make policy: “You don’t do this in a kind of chortling, smoking your cigar, conspiratorial thinking way. You do it by persuading yourself that whatever is in your own personal self-interest is in the interests of everybody else. So you persuade yourself that, actually, government services, things like spending on education . . . need to be cut so that the deficit will shrink, so that your tax bill doesn’t go up . . .” I expect we’ll find other passages to quote as the Trump years unfold. Okay. Four stocks: Our PRMRF closed at $13.97 yesterday, up from under $5 when last mentioned, in March. That’s mainly because people expect stronger oil prices: good for wealthy people who own shares in oil stocks; not good for those who merely buy it to heat their homes and power their cars. The other two stocks mentioned that day, GLDD and BOREF, remain under $5. They could hardly be more different. GLDD has been a boring disappointment for a long time now, but remains, I hope, a stodgy but solid “infrastructure play” — the nation’s largest dredging company. Silt accumulates. I hope someday better management will appear, perhaps because the company is acquired, and we will (finally) make our modest profit on the position. BOREF remains, in my view, an amazing lottery ticket. But who knew the drawing wouldn’t be for 20 years? In addition to owning a ridiculous amount the stock (if I were married, it could be grounds for divorce), I’ve tried to be helpful to the company more directly. If you invested with cash you can truly afford to lose, hang on. But be prepared to wait a lot longer (television was invented in 1926, no one made a dime from it, to my knowledge, until 1950 or so); and for the possibility that, as sometimes happens with lottery tickets, we’ll lose. GEC was until recently the new symbol for UPIP that I last wrote about here. “It’s complicated,” but if you own any, you were just offered a chance to buy more at $3.285. You have until December 23 to name the number of shares you want. I loaded up. The stock closed at $3.75 last night, and may trend down toward that $3.285 offer price; but (famous last words) I’m pretty confident it will then rise. So shares bought at $3.285 could represent a good value. Albeit, only with money you can truly afford to lose. Have a great weekend!
Two Ways To Go Today December 1, 2016November 30, 2016 This being my FIVE THOUSANDTH COLUMN (according to WordPress; actually, it seems not to have archived the first 100 or so, but why quibble?), I could either try to write something exceptional today — or just take the day off. What to do? What to do?
November 30, 2016 Garrison Keillor’s take on Trump. A Goldman Sachs partner’s take on Steve Mnuchin, Trump’s pick for Treasury: “Not a bad guy at all. But I don’t know anyone at Goldman who would tell you he has the gravitas to be Secretary of Treasury.” Being the change candidate, Trump has apparently chosen a Goldman partner without gravitas for the spot. Gravitas may not have a place in the administration of a man who will say of his ex-wife — on the radio, with millions listening — “nice tits, no brains.” And what are we to make of a president who everyone more or less assumes by now routinely lies? (“I wouldn’t believe Donald Trump if his tongue were notarized,” a Deputy New York City Mayor once famously said of a much younger Trump.) He saw thousands of Muslims cheering the fall of the Twin Towers. (Didn’t.) Won the popular vote if you don’t count the millions of illegal Hillary voters. (Nope.) Can’t release his tax returns because they’re under audit. (Can; and they’re not.*) He’s been clocked at 71 Lies Per Hour. Not good. *At least not the most recent ones, or the many for which the audit must have been completed.
Sell? November 29, 2016November 28, 2016 On the remote chance you didn’t find things to give thanks for last Thursday, take four minutes to watch this man’s life and be thankful you weren’t born in Sierra Leone — and inspired by his mission. Things will surely be a thousand times better here in America than they are in Sierra Leone; but maybe not as “great again” as we’d like. In case you missed Paul Krugman in the indispensable New York Times (subscribe!): A lot of people in politics and the media are scrambling to normalize what just happened to us, saying that it will all be OK and we can work with Trump. No, it won’t, and no, we can’t. The next occupant of the White House will be a pathological liar with a loose grip on reality; he is already surrounding himself with racists, anti-Semites, and conspiracy theorists; his administration will be the most corrupt in America history. How did this happen? There were multiple causes, but you just can’t ignore the reality that key institutions and their leaders utterly failed. Every news organization that decided, for the sake of ratings, to ignore policy and barely cover Trump scandals while obsessing over Clinton emails, every reporter who, for whatever reason — often sheer pettiness — played up Wikileaks nonsense and talked about how various Clinton stuff “raised questions” and “cast shadows” is complicit in this disaster. And then there’s the FBI: it’s quite reasonable to argue that James Comey, whether it was careerism, cowardice, or something worse, tipped the scales and may have doomed the world. No, I’m not giving up hope. Maybe, just maybe, the sheer awfulness of what’s happening will sink in. Maybe the backlash will be big enough to constrain Trump from destroying democracy in the next few months, and/or sweep his gang from power in the next few years. But if that’s going to happen, enough people will have to be true patriots, which means taking a stand. And anyone who doesn’t — who plays along and plays it safe — is betraying America, and mankind. Arguably, it wasn’t Comey or Putin or the press that sealed the deal — it was a single statement, quickly walked back but immediately distorted and amplified — inadvisedly uttered when the candidate had pneumonia, as we would learn later — that, more than anything else, changed the course of history. As argued in this lovely, thoughtful — albeit heartbreaking — piece. And here is why my smart friend John Hook is bearish. (Written in a shorthand aimed at institutional investors, but you’ll get the gist.) The Reagan-election rally in November, 1980, [quickly turned into] a huge sell for 22 months. Stocks crashed 26%. New party presidents usually do the tough stuff first so that stocks correct and then rally into the next election. Trump has called stocks a “huge bubble.” Twelve Bearish Probabilities: 1) Emerging-market currencies are devaluing very rapidly — and have correlated or coincided with stock corrections; 2) Start of Fed rate increases; 3) Low productivity and monthly inflation equal to or exceeding income growth; 4) Record high combined stock and bond valuations and near record high leverage; 5) 7.5 years into an expansion, what can go wrong usually (always) has gone wrong; 6) Inflation spike is likely during winter, probably over the inflection level of 3.0%, led by medical, shelter, oil, and average hourly earnings by spring; 7) Oil probably up 50-80%+ Y/Y ($60-65 WTI) by February because of OPEC & non-OPEC 1-1.5 mb/d production cuts; 8) Core CPI trending higher for more than a year, as now, and the fed has not increased rates, but then does—probably fed behind the curve; 9) Two years of weak capital investment and Fed Labor Market Indicator trending weaker for more than a year; 10) Flat (+/-.2% points) unemployment rate for 11 months or more —often late or end of cycle; 11) Risk of CPI inflation exceeding increase in real disposable personal income starting in 2-4 months and lasting a year as costs increase more than structurally low productivity; and . . . 12) Very rapid increases in 10 YR TR yield, like now, have preceded corrections and large crashes. That said, bear markets, if we have one, are more or less routine — and have always been followed by bull markets. Have a great day.
The Recount November 27, 2016November 28, 2016 So Hillary will have won the popular vote by more than 2 million ballots — please, Trumpies, stop talking about “the will of the people,” let alone a “mandate”; if “the people have spoken,” they have spoken for Hillary even though, under the agreed-upon rules, their voice will not be heard. Marco Rubio told “Face the Nation” this morning Russia tried to interfere with our election but — he “wants to be clear” — those attempts had no effect on the outcome. Really? Massive “fake news” posts on social media? Wikileaks that led to FBI “bombshells”? How do Rubio and others know these Russian efforts were completely ineffective? Is it the same way the tobacco industry knew its massive advertising campaigns didn’t cause children to become smokers? It seems a stretch. With Putin’s aggressive help, bidden or unbidden, Trump came within two or three million votes of winning — and won. I am with those like the President (and Hillary), who acknowledge that, however much we might wish otherwise, he really did. We should support him when he proposes something good; fight when he proposes something bad; and hope he makes America proud. Although so far, in the words of Colin Powell, he has been a “national disgrace.” It is a strange time — to say the least. But on one piece of this, anyway, I think we now have some clarity. Here it is, from Marc Elias, our counsel: Listening And Responding To Calls For An Audit And Recount Over the last few days, officials in the Clinton campaign have received hundreds of messages, emails, and calls urging us to do something, anything, to investigate claims that the election results were hacked and altered in a way to disadvantage Secretary Clinton. The concerns have arisen, in particular, with respect to Michigan, Wisconsin and Pennsylvania — three states that together proved decisive in this presidential election and where the combined margin of victory for Donald Trump was merely 107,000 votes. It should go without saying that we take these concerns extremely seriously. We certainly understand the heartbreak felt by so many who worked so hard to elect Hillary Clinton, and it is a fundamental principle of our democracy to ensure that every vote is properly counted. Moreover, this election cycle was unique in the degree of foreign interference witnessed throughout the campaign: the U.S. government concluded that Russian state actors were behind the hacks of the Democratic National Committee and the personal email accounts of Hillary for America campaign officials, and just yesterday, the Washington Post reported that the Russian government was behind much of the “fake news” propaganda that circulated online in the closing weeks of the election. For all these reasons, we have quietly taken a number of steps in the last two weeks to rule in or out any possibility of outside interference in the vote tally in these critical battleground states. First, since the day after the election we have had lawyers and data scientists and analysts combing over the results to spot anomalies that would suggest a hacked result. These have included analysts both from within the campaign and outside, with backgrounds in politics, technology and academia. Second, we have had numerous meetings and calls with various outside experts to hear their concerns and to discuss and review their data and findings. As a part of this, we have also shared our data and findings with them. Most of those discussions have remained private, while at least one has unfortunately been the subject of leaks. Third, we have attempted to systematically catalogue and investigate every theory that has been presented to us within our ability to do so. Fourth, we have examined the laws and practices as they pertain to recounts, contests and audits. Fifth, and most importantly, we have monitored and staffed the post-election canvasses — where voting machine tapes are compared to poll-books, provisional ballots are resolved, and all of the math is double checked from election night. During that process, we have seen Secretary Clinton’s vote total grow, so that, today, her national popular vote lead now exceeds more than 2 million votes. In the coming days, we will continue to perform our due diligence and actively follow all further activities that are to occur prior to the certification of any election results. For instance, Wisconsin and Pennsylvania conduct post-election audits using a sampling of precincts. Michigan and many other states still do not. This is unfortunate; it is our strong belief that, in addition to an election canvass, every state should do this basic audit to ensure accuracy and public confidence in the election. Beyond the post-election audit, Green Party candidate Jill Stein announced Friday that she will exercise her right as a candidate to pursue a recount in the state of Wisconsin. She has indicated plans to also seek recounts in Pennsylvania and Michigan. Because we had not uncovered any actionable evidence of hacking or outside attempts to alter the voting technology, we had not planned to exercise this option ourselves, but now that a recount has been initiated in Wisconsin, we intend to participate in order to ensure the process proceeds in a manner that is fair to all sides. If Jill Stein follows through as she has promised and pursues recounts in Pennsylvania and Michigan, we will take the same approach in those states as well. We do so fully aware that the number of votes separating Donald Trump and Hillary Clinton in the closest of these states — Michigan — well exceeds the largest margin ever overcome in a recount. But regardless of the potential to change the outcome in any of the states, we feel it is important, on principle, to ensure our campaign is legally represented in any court proceedings and represented on the ground in order to monitor the recount process itself. The campaign is grateful to all those who have expended time and effort to investigate various claims of abnormalities and irregularities. While that effort has not, in our view, resulted in evidence of manipulation of results, now that a recount is underway, we believe we have an obligation to the more than 64 million Americans who cast ballots for Hillary Clinton to participate in ongoing proceedings to ensure that an accurate vote count will be reported. Needless to say (but when has that ever stopped me?), if those on the left who voted for Jill Stein had voted for Hillary Clinton, there would be no need of a recount; Hillary would have won the popular vote and the game. Have a great week.
Happy TG November 23, 2016 A site to monitor the national popular vote — here. Hillary now leads by more than 2 million. I wish there were captions, but you may enjoy some of these. Click on the photo or press the space bar to move to the next. (Thanks, Mel!) And don’t miss this two-minute tribute President Obama paid Ellen DeGeneres yesterday as he awarded her and 20 others the Presidential Medal of Freedom. How far we’ve come. Oh! And Happy Thanksgiving! We have hot water! And Barack Obama! And Advil! And all the world’s knowledge and music in our pocket! (Plus: it’s a flashlight!) (And an alarm clock and a computer and a tweet machine and an instant messenger and a GPS navigator!) (And a video phone!) And we have each other. And all that our parents and ancestors did to get us to this point, where most of us live better, in most respects, than any king, czar or emperor ever did before us. (So, please — let’s not f— it up.) Thanks for your readership. Don’t eat too much.
Ellen — And Thanks November 23, 2016November 23, 2016 A site to monitor the national popular vote — here. Hillary now leads by more than 2 million. I wish there were captions, but you may enjoy some of these. Click on the photo or press the space bar to move to the next. (Thanks, Mel!) And don’t miss this two-minute tribute President Obama paid Ellen DeGeneres yesterday as he awarded her and 20 others the Presidential Medal of Freedom. How far we’ve come. Oh! And Happy Thanksgiving! We have hot water! And Barack Obama! And Advil! And all the world’s knowledge and music in our pocket! (Plus: it’s a flashlight!) (And an alarm clock!) (And a computer and a tweet machine and an instant messenger and a GPS navigator!) (And a video phone!) And we have each other. And all that our parents and ancestors did to get us to this point, where most of us live better, in most respects, than any king, czar or emperor ever did before us. (So, please — let’s not f— it up.) Thanks for your readership. Don’t eat too much.
Why We Lost The Rust Belt November 22, 2016 Are you still reading the links from Monday (posted Sunday to give you extra time)? Here’s one more: “Rust Belt Dems broke for Trump because they thought Clinton cared more about bathrooms than jobs.” It has the ring of truth — though if you read to the end, you’ll see we really did try. We just needed to do it better. We got a couple million more votes than he did — always important to remember. And so many stayed home it was barely a quarter of the voting-age population who put him in power. But in power he is. So those of us among the 75% who didn’t vote for him . . . or among the 25% who did, but with trepidation . . . need to stay engaged to help get America through this, applauding anything good Trump might do and passionately resisting the rest. A huge voter turn-out in 2018 to sweep Congress and state legislatures blue may be unlikely but is absolutely possible — it’s legal to vote in mid-term elections! — and what, I would argue, we all need to work for. I promise something lighter tomorrow.
Listening — Really LISTENING — To The Opposition November 20, 2016 But first you have to look at this cartoon. And read Aaron Sorkin’s letter to his daughter. And follow Think Progress. My friend Paul Abrams writes: You may recall my article during the campaign about Trump seeking to become America’s Putin and how easy it will be. Here it begins. [“Donald Trump is leveraging his new position as president-elect to empower his business empire — and he’s doing it publicly.”] Gentlemen, our democracy is lost. We need to understand how to form an effective political opposition in a dictatorship. Mark my words: Trump will have his picture and name on every infrastructure project the Congress funds. Obama was forbidden to do that. No photo. No name. Trump may also be forbidden. He won’t care. He will just do it. Who is going to stop him? Here’s the near term picture: family brought into WH, informally if necessary. Pictures of Trump all over the place associated w work and improvements in your community. Continuous rallies. Constant attacks on whatever is left of the legitimate press. An AG hostile to civil rights. All US attorneys replaced by sycophants. Within a year, fascism will become our new way of life. If that leaves you even more eager to take to the streets, read this first — “The Right Way To Resist Trump” — in case you missed it in the Times. The protests, argues the author, are counterproductive. . . . There will be plenty of reasons to complain during the Trump presidency, when really awful decisions are made. Why complain now, when no decision has been made? It delegitimizes the future protests and exposes the bias of the opposition. . . . Meanwhile, my friend Nathaniel Frank posted this very thoughtful piece: “Bridging the Divide: Thoughts from a Conversation with a Trump Voter.” . . . I took the opportunity to listen—really listen—to what Conservative Stranger had to say. . . . “All we’d ask,” he pleaded, “is that you don’t thumb your nose at us, don’t make snide remarks about how we like our guns and our bibles, don’t congregate with your college-educated peers about how out of touch and insignificant we are just because we don’t possess those same higher degrees.” . . . In this context, Hillary Clinton’s dismissal of half of Trump’s supporters as “deplorables” was potentially disastrous to her campaign. Liberals will do no better in bringing about the world they want to see if they continue to convey the kind of contempt that helped derail her win. . . . Too many progressives fail to engage with the people they most need to persuade, opting instead for the comforting but counterproductive narrative that conservative voters are irredeemable. . . . It Could Be Worse, argues Ron Elving, at NPR.com. Yet the one bright spot a lot of us see — a chance finally to begin a major infrastructure revitalization — is a trap. It sounds like what we’ve all been wanting for so long, that President Obama called on a joint session of Congress to pass “right away” in 2011. But in Trump’s version, it’s “a tax-cut plan for [wealthy] investors, and a massive corporate welfare plan for contractors.” Read it here in the Washington Post. And then subscribe, to help keep it strong. And to the New York Times, as well. We’re going to need them.