Midnight Meme Of The Day!

by Noah

Heck-uva-job, Donnie! Some plan you had there! You've had quite a rough week but, surprise, surprise, you weren't at all up to the job that you conned 62,000,000 fools into giving you (Plus, thanks to the abdication of responsibility by the Electoral College). Soon you will say that the market doesn't matter just like Cheney said deficits don't matter. Ordinarily I might have been sympathetic to a president who had this clusterphuck happen on their watch but you earned it. You willed it! You prided yourself on being The Chaos President. You're nothing but a damn psychopathic freakshow; you and your damn psychopathic freakshow party. Your party protected you every centimeter of the way. Putin clapped his hands and they jumped. They jumped for joy when the wire transfers of cash came their way. They jumped for joy when you expressed your oneness with their hate and bigotry with you comments and your judges. Now, they all share the putrid rotted fruits of your tax scam and your grossly incompetent stewardship of the economy. You're a real "Stable Genius" alright. Fuck you Donnie! Fuck your whole damn Republican Goofball Party. And fuck every other single asshole in Washington who is responsible, in any way, shape, or form for you still infesting the oval office.

It's The End Of The World As We Know It? Maybe... And Maybe Soon-- Or Maybe I'm Being Too Alarmist

I was just talking with a very credible candidate for Congress about how an increasingly senile Biden could turn out to be the Democratic nominee; he-- the congressional candidate, not Status Quo Joe-- told me he almost hopes the apocalypse comes soon because he wants to pick up the pieces. Wow! And I thought I was nuts! As speaking of government by the senile, last night, the clownish Trump ran to Sean Hannity on Fox to dispute the WHO report that the death rate for coronavirus is 3.4%, asserting that it's "a false number." Claiming he's "had a lot of conversations with a lot of people," he noted that "They don’t know about the easy cases because the easy cases don’t go to the hospital, they don’t report to doctors or the hospital in many cases so I think that that number is very high. I think the number, personally, I would say the number is way under one percent."

Look, I'm no financial advisor but take this warning from me: don't fall into a bull trap. That's when the stock market is plunging and it goes up a bit and fools rush in hoping for a quick profit only to see the plunge continue the following day, taking their investment gamble with it. I think we had one of those yesterday, when the Dow Jones bounced up over a thousand points-- very tempting. Don't do anything crazy today. The Dow headed straight down when it opened this morning and has given back all the fake "winnings" from yesterday.

The American government has quite a lot in common with Iran's government, whose response to the pandemic has been characterized as being motivated entirely by pride, paranoia, secrecy and chaos. Have you ever pictured Señor Trumpanzee as a mullah or even an ayatollah?

Bloomberg News warned that "It is hard to exaggerate the historic significance of Tuesday’s events in the bond market… According to historical work by Robert Shiller, the Nobel laureate economist at Yale University who has reconstructed the 10-year interest rates available in the U.S. back to 1871, it has never before dropped this low. Many momentous events have shaken the U.S. since Ulysses S. Grant’s presidency, but none of them were sufficient to drive long-term money down to such cheap levels." The Financial Times put it more succinctly: "The 10-year U.S. Treasury yield dropped below 1 per cent for the first time on Tuesday, after the Federal Reserve delivered its first emergency rate cut since the financial crisis in order to stave off the long-term economic impact from the spread of the coronavirus." That was first time-- as in first time ever.

That's because markets saw the rate cut-- by a Trump-badgered Fed-- as pure desperation. Canadian financial expert and author Kiril Nikolaev wrote yesterday that emergency interest rate cuts are always bad news for the stock market and-- they're not going to stop this Trump Market from turning into full fledged bear market-- as opposed to a correction. "The Federal Reserve shocked market participants on Tuesday after announcing an aggressive 50-point rate cut. The move was intended to shore up liquidity in an effort to combat the economic impact of the coronavirus. Unfortunately, the big rate reduction did not drive the Dow Jones Industrial Average higher as expected. On the contrary, the index ended the trading day down nearly 3% despite the Fed’s intervention. This indicates that the market is pricing in factors that cannot be solved by loose monetary policies. Over the last two decades, we’ve seen six instances where the Fed reduced rates by 50 basis points or higher. Every single one of them preceded a bear market."

Since 2001, the Fed has been introducing emergency rate cuts of 50 basis points or higher in an attempt to avert a crisis. History tells us that this strategy doesn’t work. If anything, it’s a sign that the stock market is headed for a monumental collapse.

In 2001, the Federal Reserve cut rates by 0.5% three times within six months. The stock market dumped over 30% despite the central bank’s intervention.

It’s the same story in 2007 and 2008, where the Fed introduced three aggressive rate reductions. The result? A massive stock market collapse of over 50%.

It appears that history is showing that emergency rate cuts are desperate measures. The Federal Reserve knows there’s a big crisis coming but its measure likely won’t stop the bleeding.

The stock market tanking in spite of the Fed’s emergency intervention is a signal that the risk of the coronavirus to the economy is bigger than anticipated. That statement appears to be true as the World Health Organization (WHO) released new figures regarding the mortality rate of the coronavirus.

On Tuesday, WHO officials said that the global death rate for the COVID-19 is actually 3.4%. This number is significantly higher than the previous estimate of 2.3%. The seasonal flu has a mortality rate of 1%.

WHO Director-General Tedros Adhanom Ghebreyesus said in a press conference in Geneva, "globally, about 3.4% of reported COVID-19 cases have died.

"WHO official Dr. Mike Ryan paints an ominous picture of how little we understand about the virus: "Here we have a disease for which we have no vaccine, no treatment; we don't fully understand transmission; we don't fully understand case mortality."

In the United States, there are now 122 confirmed cases and nine total deaths. Globally, the number of confirmed cases soared above 93,000.

Hedge fund manager Will Meade sums up the magnitude of the impact of the virus to the economy. "The last time the FED did an emergency 50 point rate cut was after Lehman collapse in 2008. Anyone tells you the coronavirus isn't a big deal is either stupid or naive."

Coronavirus Could Halve The U.S. Economic Growth This Year

As illustrated, an emergency rate cut often doesn’t bode well for the stock market. Will Meade echoes this view. The former Goldman Sachs analyst said that an emergency rate cut this big means that the economy would tank this year.

This sentiment is confirmed by a new Brookings Institution study. Brookings concluded that the mild coronavirus pandemic would wipe out around $420 billion from this year’s growth. In 2019, the current-dollar GDP surged by 4.1% or $848 billion. In other words, the least severe scenario effectively halves 2020’s economic expansion.

If worse comes to worst, Brookings projects that coronavirus will obliterate $1.78 trillion from GDP growth. According to the study, global GDP would contract by over $9 trillion in case the global pandemic leads to a “more serious outbreak similar to the Spanish flu.”

In either case, the economy and the stock market have a bleak outlook this year. It’s likely that no amount or quantity of rate cuts will stop the Dow Jones from plunging into a bear market.

Wall Street Journal reporters Jennifer Calfas and Mike Cherney are following the steady spread of coronavirus across the U.S. Yesterday saw the 11th fatality-- one in California and 10 inWashington. Leaders of both houses of Congress agreed to an $8 billion package to tackle the disease, including $3 billion to develop treatments. Two mentally deranged right-wing nuts-- Andy Biggs (R-AZ) and Ken Buck (R-CO)-- were the only votes against it.

Soon after the agreement's overall framework was released, lawmakers released the 28-page bill. Two Democratic leadership sources told NBC that the House is expected to vote on the deal later in the day. It will need two-thirds of the House to pass it and leadership expects it to pass with bipartisan support.

The bill includes a provision that requires that funds are only used to fight the coronavirus and other infectious diseases as some Democrats feared that the Trump administration could raid the funding and use it for other unrelated purposes.

“This should not be about politics; this is about doing our job to protect the American people from a potential pandemic," Senate Appropriations Committee Chairman Richard Shelby said. "We worked together to craft an aggressive and comprehensive response that provides the resources the experts say they need to combat this crisis. I thank my colleagues for their cooperation and appreciate President Trump’s eagerness to sign this legislation and get the funding out the door without delay.”

The legislation would provide more than $2 billion to the Centers for Disease Control and Prevention for public health funding for prevention, preparedness and response.

It also would allocate more than $3 billion to a public health emergency fund and the National Institutes of Health for research and development of vaccines, treatment and testing of the coronavirus. The bill would also provide nearly $1.3 billion to help protect the health of Americans living abroad from the coronavirus.

A House Democratic aide said that the legislation would provide more than "$300 million to help ensure that, when a vaccine is developed, Americans can receive it regardless of their ability to pay."

"The legislation ensures that the federal government will only pay a fair and reasonable price for coronavirus vaccines and drugs and provides HHS the authority to ensure that they are affordable in the commercial market," the aide said.

I got an e-mail from the mayor of Los Angeles today-- back from his trip to Dallas to help Biden get elected, thereby destroying America. (Bernie led Biden in L.A. by about 11 points but maybe someone in Dallas gives a shit about what Eric Garcetti has to say.

If you've been following our coverage of the pandemic you already know that the official coronavirus numbers are wrong, which is no secret. And we're not just talking about China. The numbers are all wrong in the U.S. too. "The data are untrustworthy," wrote Alex Madrigal, "because the processes we used to get them were flawed. The Centers for Disease Control and Prevention’s testing procedures missed the bulk of the cases. They focused exclusively on travelers, rather than testing more broadly, because that seemed like the best way to catch cases entering the country.

This artificially low number means that for the past few weeks, we’ve seen massive state action abroad and only simmering unease domestically. While Chinese officials were enacting a world-historic containment effort-- putting more than 700 million people under some kind of movement restriction, quarantining tens of millions of people, and placing others under new kinds of surveillance-- and American public-health officials were staring at the writing on the wall that the disease was extremely likely to spread in the U.S., the public-health response was stuck in neutral. The case count in the U.S. was not increasing at all. Preparing for a sizable outbreak seemed absurd when there were fewer than 20 cases on American soil. Now we know that the disease was already spreading and that it was the U.S. response that was stalled.

Meanwhile, South Korean officials have been testing more than 10,000 people a day, driving up the country’s reported-case count. Same goes for Italy: high test rate, high number of cases. (Now some Italian politicians want to restrict testing.) In China, the official data say the country has more than 80,000 cases, but the real number might be far, far higher because of all the people who had mild(er) cases and were turned away from medical care, or never sought it in the first place. That may be cause for reassurance (though not everyone agrees), because the total number of cases is the denominator in the simple equation that yields a fatality rate: deaths divided by cases. More cases with the same number of deaths means that the disease is likely less deadly than the data show.

The other problem is, now that the U.S. appears to be ramping up testing, the number of cases will grow quickly. Public-health officials are currently cautioning people not to worry as that happens, but it will be hard to disambiguate what proportion of the ballooning number of cases is the result of more testing and what proportion is from the actual spread of the virus.

People trust data. Numbers seem real. Charts have charismatic power. People believe what can be quantified. But data do not always accurately reflect the state of the world. Or as one scholar put it in a book title: "Raw Data" Is an Oxymoron.

The reality gap between American numbers and American cases is wide. Regular citizens and decision makers cannot rely on only the numbers to make decisions. Sometimes quantification actually obscures as much as it reveals.

This is the letter the mayor's staff drafted for him to send out. Keep in mind that some the information is correct and some of the stuff they've written about the disease is absolutely wrong and not helpful (even if he wasn't a Biden supporter).

Here’s what you should know: COVID-19 symptoms include fever, cough, and shortness of breath-- and may appear as few as two days or as long as 14 days after exposure. Person-to-person spread mainly occurs from contact with an infected person coughing or sneezing (similar to the flu). In rare cases, it may be possible that COVID-19 can be transmitted by touching an infected surface or object.

Here’s what the City is doing:

• We’ve declared a local state of emergency to access additional resources that will help our region prepare.
• We’ve activated our City Emergency Operations Center to a heightened level of vigilance.
• The City is working closely with the Los Angeles County Department of Public Health (DPH) and the County Office of Emergency Management (OEM) to share updates, guidance, and information on COVID-19.
• All City Departments are reviewing and updating Continuity of Operations Plans to ensure that they can continue delivering essential services in the event of an emergency.
• The Port of Los Angeles and San Pedro Bay Complex are on heightened alert. The Coast Guard is assessing all inbound vessels to determine whether the vessel has visited a country impacted by COVID-19 within the last five ports of call. Vessel operators are required to report ill crewmembers and passengers within 15 days of arrival to any U.S. port.
• LAX is following the guidance provided by the Centers for Disease Control and Prevention (CDC), Customs and Border Protection (CBP), and L.A. County DPH-- including screening travelers with possible exposure and following best practices to keep travelers and employees safe. This includes installing more than 250 additional hand sanitizer stations and using virus and bacteria-killing disinfectants throughout the airport. We’re cleaning public areas and restrooms at least once every hour, and increasing deep cleaning-- focusing on high touch areas like handrails, escalators, elevator buttons, and restroom doors. We’re also adding signage with information on COVID-19 symptoms and how to reduce the spread of illness.

Here’s what you can do:

• Take precautions: If you are sick, stay home. Wash your hands often with soap and water for at least 20 seconds. Avoid touching your eyes, nose, and mouth with unwashed hands. Cover your cough or sneeze. Clean and disinfect frequently touched objects and surfaces. Get a flu shot to prevent the flu, which has similar symptoms to COVID-19. If you have recently traveled in an area with COVID-19 infections and are showing symptoms, monitor your health and seek guidance from a medical professional. Currently, the CDC and DPH are not recommending personal face masks be used by people who do not have prolonged exposure to individuals identified as at risk.
• Plan ahead: Living in earthquake country, we know the importance of personal preparedness on any given day. Have extra food, water, medical supplies, and emergency kits in your homes and offices. Talk to your family, friends, and neighbors to develop emergency plans.

What Blows Up Must Come Down

What Blows Up Must Come Down by Nancy Ohanian

Reporting for Bloomberg News early Wednesday morning, Adam Haigh and April Ma noted that that U.S, and European futures markets plummeted after Iran the Iraqi bases Tuesday night. "Wednesday’s action paralleled market moves on Friday and Monday. Investors dumped risk assets and flocked to havens Friday after the U.S. killed a top Iranian military leader. Then those moves reversed on Monday, even amid warnings against retaliation." This morning everything settled down before markets opened, although gold prices jumped above $1,600 per ounce and benchmark Brent crude jumped as high as $71.75 per barrel, both very bearish signs for stocks.

Desmond Lachman of the American Enterprise Institute used to be a deputy director in the International Monetary Fund's Policy Development Department and the chief emerging market economic strategist at Salomon Smith Barney. His OpEd in The Hill Tuesday was a warning to the GOP about Trump's stock market gamble. Most of us already know that Trump isn't as smart as he thinks he is. Trump, though, doesn't. He wrote that as the election campaign gets into full swing, Señor Trumpanzee ought to "reflect on a 1929 cautionary tale involving Irving Fisher, the pre-eminent U.S. economist of his time. Maybe then Trump would not keep making the stock market’s performance on his watch a principal economic argument in his reelection bid."

On October 22, 1929, two days before the start of the 1929 stock market crash, Irving Fisher was positively bullish on the U.S. stock market outlook. In his view, the U.S. economy’s fundamentals were strong, the stock market was under-valued and stock prices had reached “what looks like a permanently high plateau.”

Unfortunately for Fisher, by the end of November 1929, U.S. stock prices had declined by 30 percent. As a result, his reputation as an economist was in tatters as the stock market continued its descent over the next three years.

Fast forward to 2020, we have President Trump both telling us how great he has made the U.S. economy and trumpeting the 40 percent increase in stock market prices under his watch. In his mind, these are major achievements that warrant his reelection.

Never mind that at this stage in both Bill Clinton and Barack Obama’s presidencies, stock prices had increased by around 50 percent. Or that economic growth under Trump has been little different than that under Obama and around half the pace under Clinton. Or that Trump’s 2017 unfunded  tax cut has caused the budget deficit to balloon and has put the country’s public debt on an explosive path.

Never mind too that the stock market rise under Trump’s watch has probably had a lot more to do with the Federal Reserve’s ultra-easy monetary policy than with Trump’s economic policies. This is especially the case considering that his trade war has contributed to a synchronized global economic slowdown that casts a dark cloud over global financial markets.

More troubling for Trump’s reelection prospects is the fact that the U.S. stock market bull-run is now old by historical standards. Indeed, it is now in its 11th year, and it has seen around a fourfold increase in stock prices from its March 2009 low. According to Nobel Laureate Robert Shiller, this has taken U.S. equity valuations to very lofty levels that have been experienced only three times in the past one hundred years.

Experience with the end of long U.S. bull market runs should be keeping Trump awake at night. Since the early 1970s we have had three bear markets in which U.S. stock prices have declined by around 50 percent and two bear markets in which they have declined by around 30 percent. One would think that a fall by anything like these amounts before November 2020 would almost certainly put paid to Trump’s reelection bid.

Nobody of course knows when the current long-dated bull market will end. Nor does one know what might be the event that will trigger the end to that run.

But one would need to be excessively Pollyannaish not to recognize that the conditions are in place for a serious bear market. The world is drowning in debt and global credit has been misallocated in a major way. At the same time, dark storm clouds are gathering that could precipitate a large U.S. stock market decline well before the first week of November.

It is not simply that the world economy looks to be in poor shape. Europe is now on the cusp of a recession, the Indian and the Chinese economies are slowing down abruptly, the U.S. manufacturing sector is in a slump, world trade tensions continue to simmer and public unrest characterizes all too many countries.

It is also that a geopolitical event like a further escalation in U.S.-Iranian relations or a Middle Eastern unraveling could trigger a disruption in international oil supply and induce international investors to become very much more risk averse than they are today.

While nobody can know when the U.S. stock market might swoon, there is one thing about which one can be certain. It is that if the end of the bull-run does occur before November 2020, Trump will claim that it had nothing to do with his trade or foreign policies. Rather, he will try to convince us that it had everything to do with Federal Reserve Chairman Jerome Powell’s obstinacy to slash interest rates and to engage in another round of quantitative easing.

How Quickly Could The Stock Market Bring Down The Trumpist Regime?

It's worth noting (again) that Trump's days in the White House could be coming to a close more rapidly that previously thought. Alan Hall is a senior analyst at the Socionomics Institute, a think tank dedicated to using data on social mood to understand and anticipate social trends. He sees trouble on the horizon for Señor Trumpanzee, based on more than just Mueller's investigations into Putin-Gate.

He wrote that the third of the country that actually wants the dangerous and destructive orange orangutang to stay in office "should hope the stock market rises, and those who want him ousted should hope it crashes. Why? History shows that the stock market is a useful indicator of people’s attitudes toward the president. Socionomic theory proposes that society’s overall mood regulates both stock prices and the public’s perceptions of its leaders. Positive social mood makes society feel optimistic, bid up stock prices and credit leaders for their good feelings. Negative social mood makes society feel pessimistic, sell stocks and blame leaders for their bad feelings. These tendencies are evident in presidential re-election outcomes. Presidents Hoover and Carter, for example, lost bids for re-election during trends toward negative social mood as reflected by declining stock prices. In fact, the stock market is a better re-election indicator than inflation, unemployment and GDP growth combined, as my colleagues at the Socionomics Institute demonstrated in a 2012 paper."

Social mood’s influence is also evident in the results of U.S. presidential impeachments and near-impeachments. Twice in history, the U.S. House of Representatives has voted to impeach a president. In both cases, social mood was trending positively, as reflected by rising stock prices, and in both cases, the Senate voted for acquittal.

Figure 1 illustrates the timing of the first presidential impeachment. On March 2, 1868, the House of Representatives formally agreed to eleven articles of impeachment against President Andrew Johnson. The Senate took three separate votes, and each fell one vote short of the two-thirds majority necessary to remove Johnson from office. The Senate acquitted Johnson on May 26, 1868, during a stock rally that added to the 250% increase since October 1857.

Figure 2 shows that a substantial trend toward positive social mood preceded President Bill Clinton’s impeachment in the House and subsequent acquittal in the Senate. Note that some of the most serious events in the Monica Lewinsky scandal coincided with the largest downturn in the Dow during Clinton’s presidency. Yet, as the Dow recovered, so did Clinton’s approval ratings. And despite a $70-million prosecution of Clinton’s related perjury and obstruction of justice charges, the Senate acquitted the president as positive social mood lifted the Dow, Dow/gold and Dow/PPI to important peaks.

President Richard Nixon’s near-impeachment and resignation from office serves as a textbook case of how social mood influences the fortunes of public figures. Figure 3 shows the Dow Jones Industrial Average surrounding his time in office. The soon-to-be-infamous Watergate break-in occurred toward the end of a strong 67% rally in the Dow from May 1970-January 1973. That trend toward positive mood helped Nixon win re-election in a landslide. But as mood trended toward the negative, the public’s view of its leader darkened, its appetite for scandal increased, the investigation accelerated, and Nixon’s fortunes changed. With almost certain impeachment looming, Nixon became the first president to resign from office on August 9, 1974.

What does this history tell us about the probability that President Trump will serve a full term in office? We considered this question in the June 2017 issue of The Socionomist. Figure 4 is a chart from that issue, updated to the present. It depicts the trend of social mood as reflected by the Dow. We left the gray arrows showing our 2017 analysis in place, and we added red arrows to indicate the possibilities going forward. In July 2017, Congressman Brad Sherman formally introduced an article of impeachment against the president in the House of Representatives. Yet as the market rose during 2017, President Trump-- despite low approval ratings, tremendous staff turnover, unrelenting criticism from the political left and numerous indictments and charges of Trump associates in the ongoing Mueller investigation-- did not face an impeachment vote. After the stock market peaked on January 26, 2018, however, the tone changed, and even some on the political right became more critical of the president.

Since the October 3 stock market peak, disapproval of the president has grown steadily louder and more strident. At the same time, the Mueller investigation has implicated more and more of the president’s inner circle in illegal activities. The Democrats won control of the House in the 2018 midterms. A November 26 Gallup poll revealed Trump’s disapproval rating had hit an all-time high. On December 10, Fox News’s senior judicial analyst Andrew Napolitano said Trump could be charged with “three separate crimes and could be indicted while serving as president.” By December 17, the Mueller investigation had issued more than 100 criminal counts and charged 34 people, 10 of whom have been found guilty. That same day, Wired published its list of “All 17 (Known) Trump and Russia Investigations” and said, “it’s increasingly clear that, as 2018 winds down, Donald Trump faces a legal assault unlike anything previously seen by any president.”

In the weeks since the Trump Foundation agreed to dissolve, and Secretary of Defense James Mattis and diplomat Brett McGurk have resigned. On December 24, Time reported, “National Christmas Tree to Stay Dark During Holiday Due to Government Shutdown,” and several news organizations ran stories with versions of The Atlantic’s headline, “President Trump’s Nightmare Before Christmas,” as the stock market plunged. Of course, stalwart supporters of the president remain. Yet the number of oppositional voices is rising. A December 19 NBC News/Wall Street Journal poll found that 41% of Americans favor impeachment hearings.

We don’t know what the Mueller investigation will ultimately reveal, but for Trump, the facts may not matter as much as the social mood. Fasten your seatbelt and keep your eyes on stock market indexes, our best reflection of the trend of social mood.

In summing up the reasons for such a disastrous stock market under Trump, one of my financial advisors wrote that "This year told a tale of trade conflicts with China, the intensifying Mueller investigation, geopolitical tensions, government shutdowns over the budget and the possibility of slower economic growth amid higher interest rates. While we’ve seen some progress on trade talks with China, there are still contentious issues to be ironed out... This is the first year in nearly a decade in which most major asset classes will end in negative territory... The broad market S&P 500 is approaching bear market territory as defined by a 20% decline."

Is there no bottom to the Trump Stock Crash?

And today? Trump's policies and disgraceful, erratic behavior drove all the markets much lower again. In fact, today was the worst start to a year since 2000-- just after George W. Bush had stolen the election for Gore/Lieberman. The Dow dropped 660.02 points and the NASDAQ was down 202.43. How low do the markets have to fall before Senate Republicans give Pelosi the nod to get the raving lunatic out of office? I suspect we may all be dumpster-diving first, right?

White House Monkey Has A Christmas Present For America

The only problem with our economy is Trump (and the GOP)

Thankfully, the stock markets are all closed today. Yesterday's abbreviated session was another miserable down day. When I was much younger, I would get very worried when markets sank the way they have been lately. When you're young, it doesn't matter, unless you're foolish enough to lock in your losses by selling low. Eventually, if you're invested in strong companies, the prices always go back up to reflect values. Now I'm old and I'm not worried-- although if it take a long time to go back up...

Trump's freaking out because he's afraid he's going to take the blame, having unabashedly hitching his political fortunes to a rising stock market. Now, with stock prices in retreat, he's looking for someone else to blame and he's "become increasingly fixated on the idea that one man is to blame for the recent rout: Jerome Powell, chairman of the Federal Reserve. After the Fed raised its benchmark interest rate on Wednesday, the fifth consecutive quarterly increase, Mr. Trump fretted to aides that Mr. Powell would 'turn me into Hoover,' a reference to the man who was president in the early years of the Great Depression. Mr. Trump has said choosing Mr. Powell for the Fed job last year was the worst mistake of his presidency and he has asked aides whether he has the power to fire him. But the volatile stock market, which just posted its worst week since 2008, is falling in part because of Mr. Trump’s own policies, including an escalating trade war with China, a shutdown of the federal government and the fading effects of the $1.5 trillion tax cut Mr. Trump ushered in at the end of 2017."

Before the markets closed yesterday, CNN was already reporting that Treasury Secretary Steven Mnuchin's attempts to calm investors backfired."

Mnuchin on Sunday released an unusual statement to say he had called the CEOs of the country's biggest banks. He said the executives assured him their banks are healthy and have "ample liquidity" to lend to consumers and businesses. "Markets continue to function properly," he said.

The major bank CEOs who spoke by phone Sunday with Mnuchin were "totally baffled" by the session, according to a person familiar with the call, who said the executives found the encounter puzzling and largely unnecessary.

"It was totally out of left field and an odd thing to do," the person said, describing the timing of the call-- on a Sunday before markets opened-- as strange. All were taken aback by the public nature of Mnuchin's tweet.

On Monday, shares in JPMorgan Chase, Wells Fargo, Goldman Sachs, Bank of Americ and Citi all lost ground.

"This is the type of announcement that raises the question of whether Treasury sees problems that the rest of the market is missing," Cowen & Co. analyst Jaret Seiberg wrote in a note to clients. "Not only did he consult with the biggest banks, but he is talking to all of the financial regulators on Christmas Eve. We do not see this type of announcement as constructive."

Mnuchin plans to convene a call on Monday with the President's Working Group on financial markets, which includes the chairman of the Federal Reserve and top market and business regulators.

Stocks are on pace for their worst December since the Great Depression. On Friday, the Dow ended its worst week since 2008. The Nasdaq is in a bear market.

Adding to the shaky start on Monday: The partial shutdown of the federal government will continue at least until Thursday, and possibly into January. Although the closure of some government services isn't expected to hurt the economy, the inability of lawmakers and President Donald Trump to put politics aside to enact a budget is unnerving to investors.

"The confusion and disorder surrounding this week's spending debate suggest fiscal deadlines in 2019-- including the debt limit deadline, which we expect to fall between August to October-- could be more disruptive than they have been since the 2011-2013 period," Goldman Sachs economists wrote in a research note.

The stock selloff in part reflects concern about a looming slowdown in economic growth. Investors' worries were exacerbated last week when the Federal Reserve signaled no slowdown in its plans to continue raising interest rates next year. The market is also reacting to the Trump administration's trade war with China. The trade war helped knock China's stock market into a bear market over the summer.

Still, some market veterans argue that a panicky Wall Street is prematurely pricing in a recession that may not hit until 2020.

Trump was lucky when he inherited a lot of money from his father and then went bankrupt 6 times and was bailed out with taxpayer dollars. More recently, he inherited a very strong economy from President Obama. His policies have been chipping away at what Obama put in place-- especially all the job growth. Now Trump's failed policies have killed the goose and no one doubts he's bringing on the first recession since Bush brought on a doozy with similarly bad policies. I wonder how far the market has to fall, how much pain investors have to feel, before enough Republican senators tell the Democrats to go for impeachment and that they'll be there for conviction. Funny how Republicans are likely to prioritize the markets more than the evidence Mueller finds.

Sunday night I went to a Christmas party one for my financial advisors threw. One of her clients is former GOP heavyweight, now retired from Congress but still a relatively young and energetic man. Unprompted, he walked over to me and told me Trump had offered him a pick of a dozen top ambassadorships-- from Russia and Australia to Brazil and Argentina. He was a foreign policy wonk in Congress and he would probably make an excellent ambassador. He told me he was really excited-- until he was told flatly that his job was to represent Trump, not America. He passed on the opportunity. Tighten your belts; this ride is going to get much worse before it gets better.

A Petulant And Crazy Trumpanzee Wants A Trade War With China-- Stock Market Crashes

Crazy news from Trump World yesterday-- all chaos all the time: his lead lawyer quit or was fired; National Security Advisor H.R. McMaster was fired, to be replaced by war-monger John Bolton (who wants to start wars with North Korea and Iran); more prostitutes were telling their stories about Trump; Trump is ready to start a trade war with China... and in response to all this-- and more-- the Dow dropped 742 points (2.9%).

My financial advisor sent her clients a note blaming the crash on "concern raised by proposed tariffs and the threat of future trade issues with China that could affect global growth... The potential for rising interest rates coupled with increased tariffs has generated concern among some investors despite strength in the underlying domestic economy and labor markets... [I]nvestors are concerned that the proposed tariffs could lead to retaliatory tariffs or broader trade disruptions. For the financial markets, it’s been a back-and-forth between unfavorable trade policy moves (e.g., the steel and aluminum tariffs) and the partial walking-back of those moves (e.g., exempting Canada, Mexico and other nations from those tariffs)... Thursday’s announcement to impose tariffs on Chinese goods creates uncertainty for domestic and global economies... As the United States and China open up trade negotiations, Mills believes the most likely outcome is that the market will start to recover if China takes a measured response to mitigate the impact of the proposed tariffs."

Trumpanzee, in an executive memo, instructed U.S. Trade Representative Robert Lighthizer to levy tariffs on at least $50 billion of Chinese imports, citing allegations China violates U.S. intellectual property. China's Ambassador, Cui Tiankai, wrote that "We don't want a trade war but we are not afraid of it. [China] "will certainly fight back and retaliate. If people want to play tough, we will play tough with them and see who will last longer." He said Trumpanzee's rush into a trade war with China make "no economic sense" because it "will affect the daily life of American middle-class people, the balance sheet of American companies and the indexes of the financial market." The first American products targeted by China are pork and aluminum products.

Mike Snider, writing for USAToday reported that Trump's foolish bull in a china shop attitude towards China will make our phones and laptops cost more. If Trump follows through with his bluster we're looking at slower U.S. growth output-- something like $332 billion over the decade.

Apple's iPhones and other smartphones, computers, washing machines and other goods could all have higher price tags.

And that, in turn, could lead to lower productivity and U.S. growth, which could also hit consumers' pocketbooks, experts say.

"Consumers will pay more, but the more important hit is there’s less consumption by business and organizations who use these technologies to become more productive," said Robert Atkinson, president of the Information Technology & Innovation Foundation. "Therefore, productivity grows more slowly, the economy grows less and wages grow less. Overall (gross domestic product) grows less."

...[T]he president's willingness to seek guidance from U.S. industry groups is a "welcomed first step," said Gary Shapiro, president and CEO of the Consumer Technology Association, in a statement.

“Unfair trade practices must be addressed, but the solution is not to put a new tax on U.S. businesses and force consumers to pay dramatically more to access the technology products they need," Shapiro said. "Increased tariffs and trade wars risk the nearly 2.5 million American jobs associated with trade involving technology products. Such a move threatens U.S. economic growth and wipes out the benefits of our recent tax reform."

...The Telecommunications Industry Association agreed that even though China had engaged in unfair trade practices, tariffs on tech products may be short-sighted. “The proposed tariffs of 25% on information communications technology goods would make it more expensive to expand and upgrade American communication networks," said Cinnamon Rogers, TIA’s senior vice president of government affairs, in a statement. "Companies, governments and individuals would find it harder to access an essential productivity tool."

Putin's Mad Pig Causes Stock Market Crash

Roland's still in his early 40's. I suggested he stay in the market and "ride it out," like I used to do. I'm older now and my riding days are done. I called my broker and told her to turn my stocks to cash. She reminded me I am still up for the year. I said "great... sell everything tomorrow, not at the opening but as soon as you see an opening that won't kill me." The market went down 4.6% yesterday. I see the correction more like 20-25%, unless Trump does something really insane. Then no one knows where the floor will be. Trump do something insane? Who could imagine that? Me-- and since Putin put him in the White House I kept telling myself, "Stop being a pig; pull your head out of the trough. You know what's going to happen. It's just a matter of time." I didn't and I did very well in that matter of time. In the end, I decided not to pull all my stocks out of stocks today, but did ask my broker to put together a play to further lighten up on stocks and increase my share in bonds as interest rates increase.

Trumpanzee should have kept Janet Yellin. Jerome Powell may want to emulate her but Jerome Powell doesn't know how. And she's for working families first and foremost. Do you think he is? Do you think anyone Trump appoints to anything is? Maybe we feel good that at least Trump didn't make Alex Jones chair of the Fed (at least not yet).

Every time he ran his fat mouth about how great "his" stock market was doing, I know he was tempting fate. I knew he was challenging the gods to bring it all crashing down on our heads. Maybe yesterday wasn't that. Or maybe it was. Or maybe it'll be next month or later. But one thing I know for sure. His economic policies are a one big ugly loser and he doesn't have a clue what he's doing-- or even understand he doesn't know he doesn't know what he's doing. After the close yesterday, Ben White noted that the repulsive, brainless slob had clearly set himself up. The always out for himself and only himself pig in the Oval Office "is learning," wrote White, "a basic and painful lesson of Wall Street: Stocks also go down... It was the largest ever single-day point drop for the Dow and it rattled both Wall Street and Washington, abruptly ending a remarkable period of placid markets where it often seemed the only direction was up. A young generation of Wall Street traders has never seen the kind of whipsaw action that seized markets Monday... It arrived amid growing concern that an economy juiced by a massive corporate tax cut, and already at full employment, could overheat and require forceful action from a new and untested Federal Reserve chairman-- installed by Trump-- to cool things down."

On top of concerns about rising inflation, the tax cuts are already increasing the federal government’s need to borrow and accelerating the date by which Congress must raise the federal debt limit. And as of Monday, there was still no plan in Washington to raise the limit and avoid a catastrophic default.

The result is that a president who tossed aside traditional presidential caution in cheerleading the stock market now stands poised to take the blame for any correction.

“This is a risk that the president clearly set himself up for,” said Charles Gabriel of Capital Alpha Partners, a Washington research firm. “Until now, Trump’s had kind of a free ride in this market and taken so much credit for it, even though so much of it was due to easy-money policies from Janet Yellen and the Fed. Now she’s out the door and volatility is back.”

...[I]f the recent jump in hourly wages gets pushed up even more by corporations handing out bonuses and pay bumps in the wake of the tax bill, the Fed may be forced to move faster to fight inflation-- offsetting the economic benefits of the tax cuts.

Interest rates are already rising as the government discloses it will have to ramp up borrowing in 2018 to make up for revenue lost to the tax-cut bill. Higher rates on government bonds make stocks look less appealing. They also can make it harder for businesses and consumers to borrow and spend, possibly slowing the economy.

On top of all this, stocks blew past traditional valuations as they raced ahead in 2017 and early 2018. A widely followed ratio designed by economists Robert Shiller and John Campbell that compares stock prices to corporate earnings hit 34 this year. The historic median for the ratio is 16.

This could have served as a warning to Trump not to associate himself too closely with a rally that looked tenuous to many Wall Street analysts. Instead, Trump bragged about the gains at every opportunity on Twitter and even in his State of the Union address.

“The stock market has smashed one record after another, gaining $8 trillion in value,” Trump said in his address to Congress.

Last week’s decline alone wiped out nearly $1 trillion in that value, according to S&P Dow Jones Indices.

Trump has regularly boasted on Twitter that the stock market rise, which actually began in 2009 at the end of the last recession, is the direct result of his policies on taxes and regulation.

“Business is looking better than ever with business enthusiasm at record levels. Stock Market at an all-time high. That doesn't just happen!” he tweeted last August.

Other senior administration officials such as Treasury Secretary Steven Mnuchin and National Economic Council Director Gary Cohn have also tied the market’s gains directly to Trump policy moves.

The latest declines left a White House that has basked in the glow of the market rally scrambling to explain away the massive decline and calm frayed investor nerves.

“The President’s focus is on our long-term economic fundamentals, which remain exceptionally strong, with strengthening U.S. economic growth, historically low unemployment, and increasing wages for American workers," White House Press Secretary Sarah Huckabee Sanders said in a statement. "The President’s tax cuts and regulatory reforms will further enhance the U.S. economy and continue to increase prosperity for the American people.”

Stocks are still far higher than they were when Trump took office, but the return of sharp volatility-- and the possibility of further declines-- has now put Trump in the uncomfortable position of being directly associated with daily market moves.

“Presidents historically haven’t commented on the stock market anywhere near as much as President Trump has,” said Ed Yardeni, market analyst at Yardeni Research Inc. “I think Barack Obama said something in 2009 about how he thought stock prices seemed low, and that was about it. So he obviously likes to take credit for the positives. Now what does he say when the market suddenly goes down?”

...[S]ignificant risks lie ahead in Washington. The biggest is whether Powell and the Fed can navigate a difficult path between allowing the economy to thrive and wages to rise without letting potentially crushing inflation take hold. And if Powell and his colleagues decide they need to pump the brakes hard, that could leave them in direct conflict with a president not shy about criticizing people he himself put into office.

And it could leave Trump with regret about jettisoning a Fed chair whom Wall Street came to love. “For the past four years, Yellen was the fairy godmother of the bull market,” said Yardeni. “And now that she’s gone, maybe we don’t get the fairy dust anymore.”

The country doesn't create any value anymore. Maybe he should have moved to do some of things he promised to do when he was campaigning-- like bringing back manufacturing for example? Putting a brake on mergers and monopolization? Instead, we have a mad orangutan threatening to shut down the government. How will the markets handle that?