Tag Archives: Investment advisor

Trump Cannot Make America Govern Itself Again

My Comments: There is far more at stake here than making Trump become relevant again. Apart from my personal, visceral fear that we’ll find ourselves in another brutal and painful war, the standard of living across these United States is eroding.

Unfortunately, that erosion is like watching a car rust. It can sit in your driveway for months and you see nothing, but give it a few years, some rain, and holes will appear.

I have no magic bullet to solve our national dilemma. There probably isn’t one to be had. All I know to do is somehow keep pushing to support the values I hold dear, and maybe, just maybe, there’ll be enough of us to bring it around.

Edward Luce on July 19, 2017

Let us give Donald Trump a pass. The last time Congress enacted a serious law was more than seven years ago, which was well before he turned up. That was Barack Obama’s healthcare reform, which is turning into Mr Trump’s nightmare. He just cannot get that law off the books.

Congress is a sausage factory that has forgotten how to make sausages. Now Mr Trump wants it to make the largest sausage imaginable: a big tax reform package. But what does Mr Trump know about sausages?

The answer is little. Passing serious bills requires the clarity of Ronald Reagan, the grit of Lyndon Johnson and the patience of Job. Mr Trump lacks all three qualities. In contrast to his attacks on critics, such as what he describes as the Fake News media, Mr Trump’s promotional skills are limited.

It is hard to think of a memorable Trump tweet on tax reform. Mr Trump is better at tearing opponents down than building the case for change. The chances are that he will fail to pass tax reform, just as he has failed to repeal and replace Obamacare.

But the blame for this does not rest solely on the current president’s shoulders. His election followed Capitol Hill’s six most fallow years since the Reconstruction era after the civil war. Though it is America’s first branch of government, Congress has ceased to function in a serious way since 2010. The Republican party, which saw its role as stopping Mr Obama from passing anything, even if he had gone more than halfway to meet them, bears most of the responsibility. Failed initiatives include an immigration overhaul and fiscal reform.

Having acquired a habit of blocking, Republicans have forgotten how to score. But the one thing that unites Republicans of all kinds, Mr Trump included, is the strong desire to cut taxes. It does not matter much how they are cut, or which ones are targeted. The party’s sole ideological glue is a desire to lower them. Other pieties, such as balancing budgets, are easily dispensed with. It ought to be a simple matter, therefore, for Mr Trump to build momentum around a big tax cut and damn the consequences. Yet his chances of success are slim. There are two reasons for this.

The first is that Mr Trump has no appetite for the intricate horse-trading required to win. This is true even at the best of times. But these are the worst. Mr Trump is increasingly distracted by the Russia investigations, which absorb most of his bandwidth. According to aides, Mr Trump spends most of his evenings watching recordings of cable news shows just as obsessed with Russia as he is. He then calls around friends in New York, Florida and elsewhere to comment on how unfairly he is being treated. Mr Trump’s obsession with “Fake News” criticism is his first, second and third priority. Anyone who doubts that should analyse his tweets and the odd hours at which he sends them. Tax reform does not feature.

The second is that Republicans are no longer a governing party. To be fair, this holds only at the federal level. There are plenty of Republican mayors and governors who do a good job of solving practical concerns at the local level. But the national party knows only how to stop things from happening. In the past six years, Republicans voted dozens of times to repeal Obamacare in the safe knowledge Mr Obama would veto their bill. Not once did Republicans sit down and work out a plan of their own. Healthcare is a dull subject to anyone who lacks interest in policy. Republicans have no interest in policy.

Instead of a party of sausage makers, Republicans have become a party of vandals. Words such as “abolish”, “repeal”, “smash” and “erase” trip off the party’s tongue. That is what comes from a habit of shutting down government and taking the US to brink of debt default. Terms such as “build”, “consult”, “trade-off” and “draft” are rare indeed.

Even something as simple-sounding as cutting taxes requires coalition-building. Besides, Republicans have to increase the US debt ceiling before they can turn to tax cuts. Mr Trump, who would have most to lose from a sovereign default, is unclear how to do this. Steven Mnuchin, his Treasury secretary, wants a “clean bill” to increase the ceiling. But Mick Mulvaney, Mr Trump’s budget director, wants to attach spending cuts, which would ensure no Democratic votes. Mr Trump cannot even negotiate with himself.

Students of history could tell Mr Trump that Rome was not built in a day. Yet the vandals were able to demolish Rome pretty quickly. Is Mr Trump a Roman or a vandal? Sadly that question answers itself.

Protectionists Are Wrong About Unemployment

My Comments: This doesn’t tell the whole story. But it helps. And, yes, this does have political implications.

Make America Great Again is a very complicated matter. What a surprise. And you thought it would be easy and would happen overnight after we drained the swamp. Well…

Donald Boudreaux is a senior fellow with the F.A. Hayek Program for Advanced Study in Philosophy, Politics, and Economics at the Mercatus Center at George Mason University, a Mercatus Center Board Member, a professor of economics and former economics-department chair at George Mason University. He writes:

What I think is missed is the average income for those employed. We know there is an increasing disparity between those at the top and those at the bottom. We have to find a way to turn this around, or there will be more than just rioting in the streets. It’s in our best interest to do this, not just for those in the middle and the bottom, but also for those at the top. If no one can afford what those at the top are offering, no one will buy it.

The following quote is from pages 30-31 of my Mercatus Center colleague Daniel Griswold’s excellent 2009 volume, Mad About Trade (footnotes excluded):

In the past four decades, during a time of expanding trade and globalization, the U.S. workforce and total employment have each roughly doubled…. Since 1970, the number of people employed in the U.S. economy has increased at an average annual rate of 2.22 percent, virtually the same as the 2.25 percent average annual growth in the labor force. Despite fears of lost jobs from trade, total employment in the U.S. economy during the recession year of 2008 was still 8.4 million workers higher than during the 2001 recession, 27.6 million more than during the 1991 recession, and 45.8 million more than the 1981-82 downturn.

Nor is there any long-term, upward trend in the unemployment rate. In fact, even counting the recession year of 2008, the average unemployment rate during the decade of the 2000s has been 5.1 percent. That rate compares to an average jobless rate of 5.8 percent in the go-go 1990s and 7.3 percent in the 1980s.

After decades of demographic upheaval, technological transformations, rising levels of trade, and recessions and recoveries, the U.S. economy has continued to add jobs, and the unemployment rate shows no long-term trend upward. Obviously, an increasingly globalized U.S. economy is perfectly compatible with a growing number of jobs and full employment.

Are You Ready For The Next Crash?

My Comments: Dr. Doom here once again! Fundamentally, I’m an optimist, except when the shadows of doom are clearly in the wings. If your money is exposed to the markets, I encourage you to read this.

If you can, look carefully at the chart and note the changes in key metrics for our economy between the two time periods.

In part, this explains why the Tea Party in Washington wants to kill any improvements to health care. But without explaining and encouraging an understanding of these metrics, whatever legitimacy the current Congress has for limiting money spent on health care goes down the drain.

I choose to ignore the author’s recommendations about what stocks to buy; I’m more interested in the coming fundamental upheaval in our ability to sustain our standards of living.

by SHAWN LANGLOIS Mar 4, 2017

The man behind the iBankCoin blog on Thursday morning asked his readers: “Where were you when Snap ripped off America?”

While his rant focused on the wild valuation the Snapchat parent SNAP, -7.95% reached in its debut, others may see the booming IPO as a last gasp before the bubble pops like it did back in the days of Pets.com and Webvan.

But the truth is, this market climate — which has seen record runups for the Dow DJIA, +0.07% , S&P 500 SPX, -0.01% and Nasdaq COMP, +0.17% — is nothing like we saw during the dot-com hey day. By many measures, it’s actually worse, according to numbers crunched this week by 720 Global’s Michael Lebowitz.

“Even though current valuation measures are not as extreme as in 1999, today’s economic underpinnings are not as robust as they were then,” he wrote. “Such perspective allows for a unique quantification, a comparison of valuations and economic activity, to show that today’s P/E ratio might be more overvalued than those observed in 1999.”

In this chart, Lebowitz stacks up the metrics from the years running up to the dot-com explosion versus what we’ve seen since 2012:

Lebowitz acknowledged, of course, that equity valuations back in 1999 were, as proven after the fact, “grossly elevated.”

But when put up against a backdrop of economic factors, he says those numbers appear to be relatively tame compared with today.

“Some will likely argue with this analysis and claim that Donald Trump’s pro-growth agenda will invigorate the outlook for the economy and corporate earnings,” he wrote. “While that is a possibility, that argument is highly speculative as such policies face numerous headwinds along the path to implementation. Economic, demographic and productivity trends all portend stagnation.”

His bottom line: “There is little justification for paying such a historically steep premium for what could likely be feeble earnings growth for years to come.”

Nursing Homes, LTC And College Planning Are Toast, So Is Retirement

My Comments: I graduated from high school some 58 years ago this month. So… Time for a visit and see who is still alive. And also meet up with my college roommate whom I haven’t seen for 54 years. A busy few days. He’s the one in the middle staring at the camera.

So I leave you with these thoughts as you think about your future in retirement…  We’ll be back in a few days.

June 8, 2017 • Evan Simonoff

Retirement isn’t the only stage of life or financial planning discipline that is headed for the history books, Edelman Financial Services founder Ric Edelman believes.

Nursing homes have lost 20 percent of their residents since 2010, and long-term-care insurance will soon be history as well, Edelman told attendees at Singularity University’s Exponential Finance conference in New York on June 8.

Americans’ longevity is increasing, and their financial lives are changing faster than most advisors or their clients can imagine. Clients who live until 2030 can expect far longer lives than most expect today, Edelman said, citing Ray Kurzweil, Google’s chief futurist.

Breakthroughs in health care and medical science are likely to eliminate heart disease and cancer as major causes of death in 15 or 20 years, Edelman said. This may sound like happy talk. But in 1900, cholera, dysentery and scarlet fever were among the five major illnesses that caused people to check out. Where are they now?

This means that retirement, which was only a late 20th century phenomenon, will soon cease to be advisors’ chief challenge. Advisors’ major task will become career counseling, or second-career counseling, Edelman said, because even clients who are well off at 65 and would be able to retire if their life expectancy was 90 will face a different set of variables if they have a good chance of living to 110 or 120.

The upshot is that advisors should start thinking in terms of a cyclical lifeline of education, work, re-education, more work, a sabbatical and a third or fourth career rather than a linear lifeline. It means clients need to diversify skills and occupations and maintain their employment viability as much as they need to diversify their investments.

Edelman also predicted that many forms of education would become free or very inexpensive. States like Oregon, Tennessee, Arkansas and New York already have offered free or very cheap tuition to students, and free online education is appearing all over the planet.

At George Washington University, over 1,000 students are 50, though it’s not cheap. But the cost of college has become so ridiculously high that it is unsustainable, Edelman implied. Free college may sound far-fetched, but it was not that long ago that America’s best state university system, California’s, was essentially free.

Hey, in the 1960s, the Free Speech movement was born at UC, Berkeley, a university that rivals Harvard in America or Cambridge in the United Kingdom. Both speech and tuition once were free at Berkeley, but these days it is hard to believe that was only 50 years ago.

Other industries that can expect to see higher growth rates include leisure and travel. The cruise ship business is booming, and on at least three cruise ships, state rooms have become permanent homes for residents who live there year-round.

Asked how clients in their 40s and 50s respond when they are told retirement at 65 or 66 is so yesterday, Edelman acknowledged that their first reaction is usually denial, followed by fear and anger. But when the idea of living a lot longer in good health sets in, their reaction is more balanced.

The timing of these predictions from Singularity University remains debatable. But as Yogi Berra said, the future isn’t what it used to be.

“…the Nature of Capitalism”

My Comments: There are changes afoot, and 45 and his cronies seem to have few clues. Or, more likely, they don’t give a damn.

The disparity between those at the top of the economic food chain and the rest of us not at the top, is called ‘income inequality’. The different approach taken by the two primary political parties, assuming there is a motivation to govern, is that ‘income inequality’ results from laziness and social giveaways, while the other party argues there are pressures whose origins are beyond the capacity for anyone to influence.

The disparities show up now as anemic job growth numbers across the nation, to the rise in disaffected people who show up at Trump rallies, to the tension in so many communities between law enforcement and the people they are supposed to be protecting, to the tension between rural and urban populations, and on and on and on.

There are huge implication for people with years of retirement left to navigate. This is a good read and very thought provoking.

by Oscar Williams-Grut | November 5, 2016

Lord Adair Turner, the former vice chairman of Merrill Lynch Europe and ex-head of the Britain’s financial watchdog, is “increasingly worried” that advances in technology are undermining capitalism and stopping the global economy recovering from its “post-crisis malaise.”

In an interview with Business Insider, Lord Turner said: “We have an economic malaise where the capitalism system is not delivering as well or to enough people to maintain its legitimacy.

“There’s a certain sort of equality of citizenship that requires that everybody does OK. I think that may breakdown. I think it may breakdown because of the fundamental nature of technology. You have to be aware that the way that capitalism works will vary depending on the different stages of technology that we’re in.”

‘Huge returns for them and relatively low and precarious returns for an increasing percentage’

Lord Turner ran the Confederation of British Industry (CBI) in the mid-1990s, before becoming vice chairman of Merrill Lynch Europe from 2000 to 2006. He then served as head of the UK’s former financial watchdog the Financial Service Authority from 2008 to 2013, taking the jobs on the eve of the global financial crisis sparked by the US mortgage security bubble.

Lord Turner is now chairman of George Soros’ economic think thank the Institute for New Economic Thinking and this year authored “Between Debt and the Devil” on the global financial crisis. (There are those on the right who claim George Soros, despite his billions, it really a communist, interested in destroying capitalism – TK)

He told Business Insider that businesses like Facebook, Uber, and Airbnb are focusing huge amounts of wealth in the hands of relatively few people and generating fewer jobs than previous technological breakthroughs. This is undermining the fundamental promise of capitalism that advances in technology and the wider economy will bring some benefit to everyone.

He said: “Look at Facebook — it now has a market cap of about $370 billion. It only employs 14,000 people and it had to do very little investment in order to get there. The reason is this technology has this extraordinary feature that once you develop one copy of software, the next billion copies don’t cost you anything.

“There’s zero marginal cost of replication. That is just completely different from the world of electromechanical machinery. Once Henry Ford had built one factory, if he wanted another he’d have to build it all over again. He had to put in lots of millions of stock.”

Technological innovations, such as industrialisation, have traditionally generated more jobs than they destroyed. But research by Citi and Oxford University earlier this year found a “downward trend in new job creation” from the 1980s onwards, with technology generated fewer, lower-skilled jobs than past revolutions.

The World Economic Forum has already forecast that 5 million jobs could be eradicated by technology by 2020 and 57% of all jobs across the OECD are at risk of automation, according to research by Citi and Oxford University.

Lord Turner says: “The problem is this: I think we probably are on the verge of a wave of automation and robotisation and the application of big data etc., which will tend to create an economy of huge returns for the people clever enough to create the software, do the big of data analytics, create the computer game, create the new business model or the data system that sits at the centre of Airbnb or Uber.

‘One of the things is it does seem to be driving inequality’

Multi-billion dollar tech platforms like Airbnb and Uber pitch themselves as part of the “gig economy,” which they say helps people earn extra money through either flexible work or renting out their assets.

But British economist Guy Standing argues that most of the people who work on these types of platforms are part of what he terms the “precariat” — low-paid workers with precarious job security. He claims these types of platforms that connect workers with employers are part of a wider trend of low-paid agency work.

Tech platforms’ role in society has been in focus recently, with a British employment tribunal ruling that Uber drivers were in fact staff rather than freelancers on the platform. As a result, they are legally be entitled to things like holiday pay and sick pay.

Lord Turner says: “I think we’re just at the beginnings of understanding what deep things this [technological change] does. One of the things is it does seems to driving of inequality. This information and communication technology enables huge wealth creation with very little investment for some categories of people in the economy and creates jobs that are very low pay for others.”

Lord Turner thinks this tech-driven inequality has contributed to the popular resentment for elites and mainstream politics that drove the Brexit vote and support from Donald Trump in the US elections.

He says: “I think we may be at a turning point in the nature of capitalism. Our assumption for the last 200 years has been that although there are ups and downs year by year, broadly speaking decade-by-decade capitalism delivers an increase in GDP per capita and although it’s not an equal system, some people do better than others, on average over a couple of decades everybody does OK.”

‘I am increasingly convinced and worried there are more fundamental forces at work’

Lord Turner suggested that a solution the tech-driven equality could be a universal basic income — a flat wage paid to all citizens that is enough for them to live on. Experiments with this are being carried out in Holland and Kenya.

An alternative could be that the government ensures people are paid a “living wage” for essential human roles such as health and social care, Lord Turner says.

He told BI: “There are many jobs that we need to do in our society, care etc., that you can’t automate and you wouldn’t want to automate. They need to be done but it may be that if you leave those entirely to the private sector or the state in trying to buy them, using competitive bidding processes to continually drive the price down, those things where we do need people to do the job will be at rates so low that it doesn’t give people enough income and dignity.

“Does that mean that we just have to accept that the state has to say through the social care system and health care system it’s going to employ people and pay people at a rate which it considers reasonable — a living wage or whatever — rather than at the lowest rate at which it can put it out to competitive bidding?”

But Lord Turner added: “I think it’s a fundamental social issue that we will increasingly have to debate and I think we don’t really know what the policy levers there are.”
Lord Turner believes that finding a solution to the problems presented by the new tech economy are essential not just to repairing global trust in capitalism but also in repairing the global economy itself.

Lord Turner argued in his book, “Between the Debt and the Devil”, that the global economy’s painfully slow recovery from the 2008 crisis has been caused by the huge debt overhang created by a half century of loose credit conditions in the run up to the crash.

But he told BI: “Whereas soon are 2008 I felt our problem was fundamentally just an enormous debt overhang generated by an out of control credit boom, I am increasingly convinced and increasingly worried that there are some more fundamental forces at work which is why it’s taking so long to get out of, and why we’re still not out of, this post-crisis malaise.”

Re-Negotiate NAFTA?

My Comments: The North American Free Trade Agreement was passed by Congress on 11/30/1994. It was approved by 34 Republicans and 27 Democrats. It’s purpose was to increase trade across North America without creating a single currency among the three countries involved.

22 years later, industries specific to each country have evolved to reflect strengths and weaknesses inherent across the region. The drive for economic survival among those industries means there have been winners and losers, but with a 22 plus year history, those strengths and weaknesses have either surfaced or been culled out.

On balance, NAFTA has been good for the agricultural sector. We have a warmer climate than Canada and more rain than Mexico. Of the hundreds of nations across the planet, we are the only one with net exports of food. Everyone one else has to import some of their food.

In anticipation of a disruption of imports of American food stuffs into Mexico, they have now started a move to import more of their food requirements from China. That won’t create jobs in the US.

I think it’s ok and necessary to re-evaluate ideas from time to time. But changes will have consequences, some of them will hurt and US farmers are nervous. This explains why.

By PAUL WISEMAN, AP Economics Writer/May 19, 2017

Why Trump’s combative trade stance makes US farmers nervous

WASHINGTON (AP) — A sizable majority of rural Americans backed Donald Trump’s presidential bid, drawn to his calls to slash environmental rules, strengthen law enforcement and replace the federal health care law.

But last month, many of them struck a sour note after White House aides signaled that Trump would deliver on another signature vow by edging toward abandoning the North American Free Trade Agreement.

Farm Country suddenly went on red alert.

Trump’s message that NAFTA was a job-killing disaster had never resonated much in rural America. NAFTA had widened access to Mexican and Canadian markets, boosting U.S. farm exports and benefiting many farmers.

“Mr. President, America’s corn farmers helped elect you,” Wesley Spurlock of the National Corn Growers Association warned in a statement. “Withdrawing from NAFTA would be disastrous for American agriculture.”

Within hours, Trump softened his stance. He wouldn’t actually dump NAFTA, he said. He’d first try to forge a more advantageous deal with Mexico and Canada — a move that formally began Thursday when his top trade negotiator, Robert Lighthizer, announced the administration’s intent to renegotiate NAFTA.

Farmers have been relieved that NAFTA has survived so far. Yet many remain nervous about where Trump’s trade policy will lead.

As a candidate, Trump defined his “America First” stance as a means to fight unfair foreign competition. He blamed unjust deals for swelling U.S. trade gaps and stealing factory jobs.

But NAFTA and other deals have been good for American farmers, who stand to lose if Trump ditches the pact or ignites a trade war. The United States has enjoyed a trade surplus in farm products since at least 1967, government data show. Last year, farm exports exceeded imports by $20.5 billion.

“You don’t start off trade negotiations … by picking fights with your trade partners that are completely unnecessary,” says Aaron Lehman, a fifth-generation Iowa farmer who produces corn, soybeans, oats and hay.

Many farmers worry that Trump’s policies will jeopardize their exports just as they face weaker crop and livestock prices.

“It comes up pretty quickly in conversation,” says Blake Hurst, a corn and soybean farmer in northwestern Missouri’s Atchison County.

That county’s voters backed Trump more than 3-to-1 in the election but now feel “it would be better if the rhetoric (on trade) was a little less strident,” says Hurst, president of the Missouri Farm Bureau.

Trump’s main argument against NAFTA and other pacts was that they exposed American workers to unequal competition with low-wage workers in countries like Mexico and China.

NAFTA did lead some American manufacturers to move factories and jobs to Mexico. But since it took effect in 1994 and eased tariffs, annual farm exports to Mexico have jumped nearly five-fold to about $18 billion. Mexico is the No. 3 market for U.S. agriculture, notably corn, soybeans and pork.

“The trade agreements that we’ve had have been very beneficial,” says Stephen Censky, CEO of the American Soybean Association. “We need to take care not to blow the significant gains that agriculture has won.”

The U.S. has run a surplus in farm trade with Mexico for 20 of the 23 years since NAFTA took effect. Still, the surpluses with Mexico became deficits in 2015 and 2016 as global livestock and grain prices plummeted and shrank the value of American exports, notes Joseph Glauber of the International Food Policy Research Institute.

Mexico has begun to seek alternatives to U.S. food because, as its agriculture secretary, Jose Calzada Rovirosa, said in March, Trump’s remarks on trade “have injected uncertainty” into the agriculture business.

Once word had surfaced that Trump was considering pulling out of NAFTA, Sonny Perdue, two days into his job as the president’s agriculture secretary, hastened to the White House with a map showing areas that would be hurt most by a pullout, overlapped with many that voted for Trump.

“I tried to demonstrate to him that in the agricultural market, sometimes words like ‘withdraw’ or ‘terminate’ can have a major impact on markets,” Perdue said in an interview with The Associated Press. “I think the president made a very wise decision for the benefit of many agricultural producers across the country” by choosing to remain in NAFTA.

Trump delivered another disappointment for U.S. farm groups in January by fulfilling a pledge to abandon the Trans-Pacific Partnership, which the Obama administration negotiated with 11 Asia-Pacific countries. Trump argued that the pact would cost Americans jobs by pitting them against low-wage Asian labor.

But the deal would have given U.S. farmers broader access to Japan’s notoriously impregnable market and easier entry into fast-growing Vietnam. Philip Seng of the U.S. Meat Export Federation notes that the U.S. withdrawal from TPP left Australia with a competitive advantage because it had already negotiated lower tariffs in Japan.

Trump has also threatened to impose tariffs on Chinese and Mexican imports, thereby raising fears that those trading partners would retaliate with their own sanctions.

Farmers know they’re frequently the first casualties of trade wars. Many recall a 2009 trade rift in which China responded to U.S. tire tariffs by imposing tariffs on U.S. chicken parts. And Mexico slapped tariffs on U.S. goods ranging from ham to onions to Christmas trees in 2009 to protest a ban on Mexican trucks crossing the border.

The White House declined to comment on farmers’ fears that Trump’s trade policy stands to hurt them. But officials say they’ve sought to ease concerns, by, for example, having Agriculture Secretary Perdue announce a new undersecretary to oversee trade and foreign agricultural affairs.

Many farmers are still hopeful about the Trump administration. Some, for example, applaud his plans to slash environmental rules that they say inflate the cost of running a farm. Some also hold out hope that the author of “The Art of the Deal” will negotiate ways to improve NAFTA.

One such way might involve Canada. NAFTA let Canada shield its dairy farmers from foreign competition behind tariffs and regulations but left at least one exception — an American ultra-filtered milk used in cheese. When Canadian farmers complained about the cheaper imports, Canada changed its policy and effectively priced ultra-filtered American milk out of the market.

“Canada has made business for our dairy farmers in Wisconsin and other border states very difficult,” Trump tweeted last month. “We will not stand for this. Watch!”

Some U.S. cattle producers would also like a renegotiated NAFTA to give them something the current version doesn’t: The right to label their product “Made in America.” In 2015, the World Trade Organization struck down the United States’ country-of-origin labeling rules as unfair to Mexico and Canada.

Many still worry that Trump’s planned overhaul of American trade policy is built to revive manufacturing and that farming remains an afterthought.

“So much of the conversation in the campaign had been in Detroit or in Indiana” and focused on manufacturing jobs,” said Kathy Baylis, an economist at the University of Illinois. The importance of American farm exports “never made it into the rhetoric.”

AP Writers David Pitt in Des Moines and Mary Clare Jalonick in Washington contributed to this report.

What Is The World Coming To?

My Comments: What’s your poison? Politics? Money? Entertainment? Sports? Religion?

Well, this post is about economics and finance. Some of you will run and hide. That’s OK. It comes from Guggenheim Investments and is a quick and dirty look at the next few months…

With spreads tight in high-yield corporate bonds, loans, structured credit, and Agency mortgage-backed securities, we expect an uptick in volatility this summer. While we see some near-term weakness ahead, our positioning, informed by the long-term themes identified in the highlights below, should provide a sound footing for our portfolios. Our Sector teams, Portfolio Managers, and Macroeconomic and Investment Research Group discuss shorter-term, sector-specific tactics for managing through current market conditions in the pages of this edition of the Fixed-Income Outlook.

Report Highlights

▪ With the Federal Reserve (Fed) set to continue to raise interest rates—and at a faster pace than that which is priced in the market—positioning for a flattening yield curve will remain a major theme in our portfolios.

▪ In addition to two more hikes this year, we expect the Fed will raise rates four more times in 2018. The Fed is also plotting a strategy to reduce its balance sheet; this should pressure yields higher in the short end and belly of the curve, which is where most of the new Treasury issuance is likely to come.

▪ Our view on the global macroeconomic environment is positive, which should support strong credit fundamentals for several years. China has stabilized, Europe is recovering, and corporate earnings in the U.S. are rising.

▪ We are focused on the legislative complexities of passing President Trump’s pro-growth agenda. Failure to put his plans into effect in a timely manner may cause markets to realize that the Trump rally is long on promise and short on delivery.