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Wall Street Shrugs Off DC Drama, Mitch McConnell Faces Tough Choice On Trump Curveball

Thursday, December 24, 2020, 9:00 am ET

President Trump's apparent distaste for the small size of direct payments to citizens ($600) and the enormous give-aways to states and foreign countries in the package deal congress sent to him on Monday caused some shock waves at the Capitol on Wednesday, prompting House Speaker, Nancy Pelosi, to agree with the president on larger stimulus checks ($2000), while Republicans clearly thought the Trump curveball was a split-fingered fastball, consequently whiffing, and looking bad doing so.

Whether intentional or not, Trump's pitch back at congress put Senate majority leader, Mitch McConnell, in an untenable position. Bear in mind, as a backdrop to the ongoing funding debate, that it was McConnell who, from the Senate floor, recently congratulated Joe Biden on winning the presidency, an outcome vehemently opposed by Trump.

McConnell has warned Republican senators not to challenge the electoral college votes which are to be presented to congress on January 6th, and now he faces a choice of either denying larger stimulus checks to Americans or giving up his long-standing fiscally-conservative position, thereby conceding to both the president and to House and Senate Democrats. No matter which way McConnell leans, he's going to lose stature among colleagues and party loyalists, to be seen as a nothing better than a grand poseur interested only in his political position of power.

Similarly, House minority leader, Kevin McCarthy, faces the same choice with regard to the Republican caucus, but he shot back at Pelosi, suggesting that while Democrats clearly favor larger stimulus checks, they are silent on the various pork expenditures that were pointed out as unacceptable by Trump.

Essentially, only President Trump will eventually come out of this mess looking good, preferring that tax dollars (and largely, borrowed dollars) be spent directly on taxpayers instead of special interests, foreign governments, states, and municipalities.

For its part, congress has once again shown its true self to the American people as 535 people who have little interest in the welfare of American citizens, always opting for political expediency over meaningful legislation.

On Wall Street, the reaction was a resounding "meh," the wizened professional bankrollers viewing the latest escapades of fiscal gerrymandering as business as usual from the political crowd.

Stocks were higher, with the exception of the NASDAQ, which posted a minor loss. Precious metals were, on the main, stagnant, while WTI crude oil prices continued to retract from recent highs above $49 per barrel, resting at $47.77 at Wednesday's close. Long-dated treasuries (10-year to 30-year) remain elevated with the short end flatlining at the zero bound, so, nothing much has changed in this shortened holiday week.

Thursday will be a shortened session for stocks, closing at 1:00 pm ET. Futures are pointing to a relatively flat open, as news flow has not provided anything startling in the macro sense and many traders have already exited for Christmas. After today, there will be only four more full sessions for the year as January 1, 2021 falls on next Friday.

How the politicians will sort out their self-engendered fiscal disaster remains up in the air, though the government will run out of money on December 28 if a continuing resolution is not conclusively agreed upon in congress and signed by the president by then.

What's riding on the dual track COVID relief and continuing resolution is which party will ultimately prevail in the eyes of Americans and whether congress sees fit to play Grinch or Scrooge with skinny stimulus checks or put on Santa Claus gear and spread the wealth to the people.

Happy Holidays!

At the Close, Wednesday, December 23, 2020:
Dow: 30,129.83, +114.32 (+0.38%)
NASDAQ: 12,771.11, -36.80 (-0.29%)
S&P 500: 3,690.01, +2.75 (+0.07%)
NYSE: 14,398.62, +77.28 (+0.54%)


Trump Punches Back On Election, COVID Relief; $600 Is "Not Enough"

Wednesday, December 23, 2020, 8:54 am ET

Just when the grifters in congress thought it was safe to leave town after passing a $900 billion COVID relief bill attached to a $1.4 trillion omnibus spending bill, President Trump caught most of them wrong-footed, releasing a video overnight indicating that he would not sign off on the legislation in its current form.

Trump, in addition to releasing a 14-minute tirade on election fraud and how the country will not stand for a false Joe Biden victory, claimed congress' measly $600 to most Americans was simply not enough and demanded they return to work and pass a bill that supplies checks for $2,000 to Americans earning less than $75,000 a year.

Now, members of congress will not have the holiday they're so used to, and it's their own fault for delaying passage of not just the COVID relief bill, but stalling on and eventually tying the bill to the government funding legislation. All of this could have been done months ago, but the senators and house members were too preoccupied with politics and getting re-elected, something many of them failed to do.

In normal times, congress would have closed up shop a week before Christmas and not return until after New Year's Day. While they'll likely be back in town and in session on January 2nd, their holiday has been delayed from the planned start date of December 18th, this past Friday.

So, it's on. Trump is not going to back down on his election claims, despite the unrelenting denial by the media that Biden won when the evidence clearly proves Trump won in a landslide. He's also not going to back down on his desire for $2,000 checks to all Americans earning less than $75,000 a year, and $4,000 for married couples. Congress and the media have pushed him too far, to a point at which the election is likely to go to the House and Senate on January 6th, as competing slates of electors have been sent from Wisconsin, Michigan, Arizona, Georgia, Nevada, New Mexico, and Pennsylvania, with one slate for Joe Biden and another for Trump.

The drama coming out of Washington is noteworthy, historic, and demanding of the attention of every citizen. The fate of the nation resides in actions commencing over the coming three weeks.

Wall Street, meanwhile, seems relatively unconcerned over everything. Despite Tuesday's losses on the Dow, S&P and NYSE, the NASDAQ gained ground, as traders erased huge, early losses. The NASDAQ had shed some 43 points by late morning, but suddenly reversed course, as did the other indices. The Dow Industrials, in particular, never got back to unchanged and ended with a 200-point loss.

These gains and losses are just noise. Investors are mostly hanging on the sidelines, not initiating new positions or fleeing to cash or fixed income as the year comes to an end. While the politics may be entertaining and critical to the future, Wall Street sees it as an unnecessary sideshow to making money, which is their sole reason for being.

Even as another 803,000 Americans filed initial unemployment claims last week - as just reported this morning - investors appear calm as cookies, seemingly immune from political unrest and the effects of the scamdemic and the restrictions imposed by governors in most states which have shut down many small businesses and threatens the existence of many more.

Oddly enough, democrat Senate minority leader, Chuck Schumer and house majority leader, Nancy Pelosi, agree with the president on larger stimulus checks. Being a shrewd negotiator, Trump may have congress over the barrel on this one, as they desperately wish to get past the COVID and funding bills, take some time off and get back to their usual wrangling oover non-issues in January, even though it's obvious that congressional actions in January are going to be anything but "business as usual."

The three videos below are essential to understanding what's really at stake in America.

Happy Holidays!

President Trump's White House video outlining election fraud, blaming Democrats and mainstream media:

Senator Rand Paul berates conservatives, Republicans, and all of congress for "monstrosity" spending bill:

Finally, President Trump excoriates congress on COVID relief bill and wasteful spending:

At the Close, Tuesday, December 22, 2020:
Dow: 30,015.51, -200.94 (-0.67%)
NASDAQ: 12,807.92, +65.40 (+0.51%)
S&P 500: 3,687.26, -7.66 (-0.21%)
NYSE: 14,321.34, -57.51 (-0.40%)


Stocks Drop, Then Pop; Global Financial News

Tuesday, December 22, 2020, 7:08 am ET

Now we're supposed to believe that there's a new, deadlier strain of the coronavirus out there that may or may not be effectively nullified by the new vaccines that are being foisted upon the public.

OK. If you want to believe all of this, you can take the short bus to the bridge I have for sale.

Notice that the new coronavirus strain was found in England, the same country that's been trying to extricate itself form the European Union since the public voted to do so nearly four years ago. How convenient, that as the deadline for a formal exit from the EU approaches, England is cut off from the rest of the continent, stoking fears that the country will run out of food, medical supplies, and other necessities.

It's a crock. By most accounts, there are somewhere between six and 30 strains of coronaviruses extant in the world today and all of them are simple mutations from a main virus. The reason a virus mutates is simple: to spread more readily so that it can survive. It's likely that the new strain is less deadly than the fake strain already causing global panic. Yes, the one that kills about .03% of those infected.

The reality is that this "pandemic" is all due to a virus about as nasty as the common cold for most. It's been used - and continues to be used - as a control mechanism by government, the medical community, and the media. Deaths from Covid are a tiny percentage (about 6%) of the total reported deaths with Covid and all the masking-up, locking down, and fussing over this non-lethal virus has caused more damage than the virus ever will. It's all intended to violate your rights, destroy the global economy, and subjugate the vast populations of the world to the Great Reset planned and promoted by the World Economic Forum (WEF) and its James Bond-type leader, Klaus Schwaub. He's actually written a book about it and it's available on Amazon.

So, Monday, when the news broke that this new strain was running loose in Great Britain, European stocks slumped and US futures fell. But then what happened? When US cash markets opened, sure, they were down, but by the end of the day, the Dow was green and the other indices suffered minor losses. And, on Tuesday, European markets were all higher. Virus hysteria is just another means to redistribute wealth and shares of stock. Weak hands sell, strong hands buy. Nothing mysterious about that at all. It's market manipulation 101.

As far as retaining civil rights and freedom are concerned, Europe is pretty much already a lost cause. Governments long ago took away citizens' rights to bear arms, and their systems are already largely socialistic. America still has time, but it's running short. If Joe Biden is inaugurated on January 20, 2021, it's over. The outcomes are either civil war or total subjugation. The coronavirus has been used to take away rights and freedoms, and it's been employed very successfully by a globalist tyranny.

Bottom line, here are some simple truths about the coronavirus:

  • It's real, but it's not deadly. Most people who contract it don't even know they have it or have what amounts to a mild dose of the flu.
  • It's being used by government, media, and the medical community to control people and rake in money.
  • Masks, lockdowns, and vaccines are ineffective and possibly harmful.
  • Ivermectin, hydroxychloroquine and other preventive treatments are available and they work, but the medical mafia doesn't want the public availed of them.
  • The rights of billions of people are being violated, daily.
  • No links were provided in this article because people need to verify facts for themselves.

    BTW: all markets, from stocks, to bonds, to precious metals, oil, commodities, and forex are controlled by big money financial institutions, hedge funds, and central banks. The only "markets" that may be beyond the control of nefarious actors are cryptocurrencies such as Bitcoin, Etherium, and others, though governments are working hard to try to regulate and tax them. So far, they've only been mildly successful.

    At the Close, Monday, December 21, 2020:
    Dow: 30,216.45, +37.40 (+0.12%)
    NASDAQ: 12,742.52, -13.12 (-0.10%)
    S&P 500: 3,694.92, -14.49 (-0.39%)
    NYSE: 14,378.85, -88.97 (-0.61%)


    WEEKEND WRAP: Fed Fail

    Sunday, December 20, 2020, 9:42 am ET

    Sick joke of the week: Congress is close to an agreement on another CV-19 relief bill.

    That's it. There have been breakthroughs, "imminent agreement", setbacks, and false starts since congress and the administration began working on a second round of CV-19 in July, or June, or May, or whatever date one wishes to throw out there.

    It's not happening. Congress spent the week preening and posturing, as they normally do, right up until the deadline for passing a continuing resolution to keep the farce going came, Friday night, when the House and Senate agreed to fund the government through Sunday. President Trump signed the measure on Saturday.

    Well, it's Sunday morning, so, we will all soon find out whether the assemblage of 535 self-absorbed narcissists can make themselves look good by passing some kind of "relief" for American people.

    Whatever comes out of congress today, or even Monday or sometime in the future (really, at this point, who knows?) will be a watered-down version of the first big stimulus, the CARES Act, the $3 trillion package approved by congress last Spring. The current proposals are for a bill that would be less than a third of that in size, about $900 billion. If and when such a bill is passed, Americans earning less than $75,000 would receive $600 to $700 each. Couples earning under $150,000 would ostensibly be eligible for one-time checks of $1200-1400, essentially half of the first go-round, so, yes, it's OK to call your congressperson Scrooge, because he/she/it is. They are collectively screwing everybody. Merry Christmas.

    About the best thing that can be said about congress in this winter of discontent, is that they've failed miserably. All they've done for the past year is watched the economy and the country sink into a desperate state of affairs, promising to help and supplying false hope. There isn't one person in ten that believes the country would be better of without them at this point.

    Dismissing the obvious self-hate that Americans may have for electing this current selection of cretins, the world kept turning and economics didn't take the week off.

    Stocks had themselves another week of gains, following the prior week's losses, with all of the indices reporting new record highs, though, with the exception of the NASDAQ, which gained more than three percent for the week, gains were modest. Techs led. Financials were mostly flat, if anybody cares.

    Oil prices continued to rise as if there was an imminent economic miracle about to happen, which might be the common thinking in the futures market, now that vaccines for the dreadful non-virus are slowing making their ways to the mainstream of both media and blood vessels. The price of a barrel of WTI crude oil rose every day since closing at $46.57 last Friday (12/11), closing out the week at a ten-month high of $49.08.

    That the meteoric rise in the price of oil coincides with the coming Christmas and New Year holidays is no accident. Oil companies have been doing this "expected demand" ritual for years. Oil and gas prices are always highest when the most people are driving, so, even though Americans are being told to stay home, stay safe, don't spread the virus during the holidays, Big Oil can't help themselves from fleecing the public anyhow.

    The odd thing about gas prices, is that they go up right away when oil prices rise, even though the gas in their underground tanks was purchases at a lower price, but, they don't come down right away when oil goes down, because they claim they are then selling gas that they purchased at a higher price. It's a classic heads-I-win-tails-you-lose con that's been victimizing the public for decades. Has congress ever done anything about obvious price-fixing? Please stop laughing.

    Bond yield were on the rise again last week, with the 10-year and 30-year yields gaining five and seven basis points, to 0.95% and 1.70%, respectively. Shorted-dated maturities remained tethered to the zero-bound, with anything having a duration of one-year or less flat-lining at .08 to .09.

    For it's part in the ongoing failure of everything "federal," the Federal Reserve held the last of its FOMC meetings for the year, wrapping up on Wednesday by reiterating its commitment to inflation above two percent and QE infinity in the form of $40 billion a month in mortgage-backed securities and $80 billion a month in treasury purchases.

    While it's arguable that the assembled economists at the Fed know exactly what they're doing, there's compelling evidence to the contrary, or at least threat they know what they're doing is wrong, but that doesn't seem to be enough to stop them from doing it. The American experiment was never supposed ot end in collapse, but the Fed seems intent on engineering a giant crack up boom and bust, just as Ludwig von Mises and the rest of the non-Keynesian, Austrian economists postulated. The American experiment may be going down in flames, but the Fed's fiat experiment, closing in on 50 years from the August 1971 closing of the gold window by then-President Richard M. Nixon, is cratering into a black hole, never to return. The dollar has been losing value so fast over the last 12 months, international companies are having a difficult time squaring their books.

    Though it's true that all fiat currencies are collapsing at the same time, the dollar has clearly taken the lead, losing significant ground to the euro, yen, and pound. So desperate are the managers of the currency that Treasury labeled Switzerland and Vietnam as currency manipulators, adding that India, Thailand, and Taiwan may also be attempting to devalue their currencies against the dollar. Such risible claims will do nothing to slow the descent of the world's reserve currency - and eventually all other fiat currencies - to its intrinsic value of zero, as short-term bills are already indicating.

    Which brings us finally to real money. As more and more individuals and corporates hasten dollar flight, nobody dared miss the incredible rise of Bitcoin over the past week, as it careened through its old high, past $20,000, to as high as $23,711.43, the more than $4,000 gain all happening in the blink of an eye, in less than two days, from early Wednesday morning until midday Thursday. Hedge funds and other investment houses have recently begun singing the praises of crypto=currencies, many of them piling into such as investments in a post-dollar environment.

    While Bitcoin was making all the headlines, gold and silver crept higher in one of the best weeks for precious metals in recent days. Gold gained $43 per ounce over the past seven days ending Friday, from $1843.60 to $1886.80 at the close in New York on 12/18. Silver rocketed from $24.09 an ounce to $26.00 over the same expanse. Gains in the metals were not without notice on public exchanges, as premiums remain elevated, as they have been for the better part of a year.

    Below are the most recent prices for commonly-traded gold and silver items on eBay (numismatics excluded, shipping - often free, included):

    Item: Low / High / Average / Median

    1 oz silver coin: 28.00 / 39.99 / 35.19 / 35.58
    1 oz silver bar: 29.85 / 37.02 / 34.00 / 34.45
    1 oz gold coin: 1,900.00 / 2,075.33 / 2,010.88 / 2,025.49
    1 oz gold bar: 1,899.00 / 2,289.95 / 2,001.29 / 1,982.69

    Dollar flight is certainly not lost on gold and silver investors. Gains in the precious metals space prompted prices for gold coins and bars to price above $2,000 on average for the first time on a month. Silver average and median prices rose less, signaling that shortages experienced earlier in the year have been resolved. Most online dealers are currently reported most commonly-purchased items in stock, which was not the case in Spring and Summer 2020.

    With spot prices for both gold and silver nestled just below their late summer highs the belief that a new surge of buying may be on the horizon has been making the rounds. Given the gains in cryptos and the length of the consolidation phase for the metals, it would make sense for gold and silver to surge to new highs in coming weeks and months, though it is well-known that January and February routinely mark lows for the year in both metals, so another pullback could occur before any meaningful advance takes place.

    Finally, this being the final WEEKEND WRAP before Christmas, it's important to be reminded to stand ready for the future, which is always uncertain. In a month's time, Americans may finally see resolution to the ongoing presidential contest, but also, quarterly and 2020 annual reports will be flowing to Wall Street investors. As murky as it may be, one should have a view of the immediate future as well as the longer term. Massive changes are happening in economies and societies around the world, changes that are likely to have profound impact upon how people behave overall, but, importantly, how financial transactions - everything from buying groceries to financing roads and bridges - are conducted.

    A new paradigm is emerging and it increasingly appears to be one that will not retain many of the rudimentary characteristics of the old one.

    Happy Holidays!

    At the Close, Friday, December 18, 2020:e
    Dow: 30,179.05, -124.32 (-0.41%)
    NASDAQ: 12,755.64, -9.11 (-0.07%)
    S&P 500: 3,709.41, -13.07 (-0.35%)
    NYSE: 14,467.82, -48.91 (-0.34%)

    For the Week:
    Dow: +132.68 (+0.44%)
    NASDAQ: +377.77 (+3.05%)
    S&P 500: +45.95 (+1.25%)
    NYSE: +112.53 (+0.78%)


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