At the end of the year a lot of people that write these types of columns tend to do some type of list. I do love a good list for sure but that is not my style. Plus it is actually more work than shooting from the cuff.
I am going to break this up into four sections. The first section will be a quick recap of 2022. The year that was. The second section will be what I see as the important trends for 2023 in business. The third section will be about what to look forward to politically in 2023. The last section will be about music.
Again, if you want to add something, just reply.
2022
2022 is almost over and like 2021 and 2020, we will be pretty glad to see it gone.
We had a war in the Ukraine that started on February 24th. Vlad the Impaler decided that the mighty Russian Army was going to sweep through this “Russian Satellite” in a few months. No worries in Moscow. NATO is a toothless tiger. The Europeans need our oil. Biden will cower at the advances we have made. Well, Putin got it 100% wrong. No surprise for a megalomaniac. His unstoppable Russian military was a huge disappointment. Uncoordinated, under supplied, bad leadership. Service men who wanted nothing to do with this illegal action. He misjudged NATO as well. He misjudged the Ukrainian people. He misjudged President Biden as well. Biden came out of the basement and made a stand with the rest of Europe and I will give him props for that. While many in this country aren’t thrilled with sending billions to this corrupt nation, I don’t think Biden had much choice. US arms and defense equipment has helped immensely and I am pretty sure with out it, the feeble Russian military would be in much better shape than it is now. I have not forgotten my assertion that Putin will not make it to the end of the year. Just goes to show, he is in more control than anyone of us previously thought.
We had an inflationary spiral the likes of which we haven’t seen since the 70’s and it really knocked a lot of people back a notch. Families were just getting over the pandemic fear and then having this sucker punch of rising prices and wages barely keeping pace. Not the best scenario to have a mid-term election for the incumbent party. The World was betting against the Democrats to hold onto a majority in either house of Congress and this massive RedWave. Funny thing happened. The Republicans as is their tradition put up some of the worst candidates on record and gave people no choice but to vote for Democrats. Yes, the Democrats had their fair share of lousy for sure but all you need to do is look at Pennsylvania and you know things are completely messed up. Fetterman vs Oz, what could go wrong? The whole thing if you ask me. It’s like the RNC and the DNC decided lets throw the worst possible candidates up against each other and see what happens. If the Democrats win, you know the country does not believe in that RedWave theory. If the Republicans win, god help us. Georgia would be another example of Bad vs Bad. This is what this country has boiled down to, let the best candidate win? Nope, let the least worst candidate win. (sorry for the grammatical abominations)
Those are just two of the biggest stories in a year filled with a million little ones. It is hard to come up with a lot of positives but no matter what happened last year there are still plenty of people who had a great year. New babies were born, marriages still took place. Plenty of great sports as well. The big black hole again was music and I won’t apologize for feeling like art has taken a very bad turn.
BUSINESS 2023
Predicting the future, especially in business, is a fools game, but I will give it a shot. I guess I am just a fool.
2022 will go down as one of high volatility, headwinds galore, and a recalibration of what earnings should look like going forward. Without a doubt, inflation was the number one story and supply chain issues would have to be story 1.1. The Fed has taken an aggressive approach to combat inflation and putting aside the fact that they were at least a year behind the curve, they are making some headway. Maybe not as fast as we all would like but inflation is running out of steam.
I am in the minority on this but I do believe that inflation can only feed on itself for a certain length of time. Prices rise to the point where consumers buy less or buy none of that product. Demand decreases and supply increases and prices stabilize or come down. That is without Fed intervention. That is also without the drunken sailors at the helm of this country as well.
Unfortunately, those “drunken sailors” are still in charge for the most part and those SOB’s are still spending like there is no tomorrow. How will this impact supply and demand? God only knows but when you put another 1.7 trillion dollars into the system, I have a pretty good idea what will happen. This lack of coordination between the White House and the Fed is not unusual but you would think these clowns would have finally figured out that if one arm is struggling to rein in spending and another arm is throwing Benjamins around like Chance The Rapper at a strip club, you know it won’t end well. Bottomline. We will be dealing with inflation for a while longer.
Economists have driven home the point that recessions rarely start when the job market is stable and strong and while I get the idea I think there are a couple things missing. Like actual participants for instance. If you recall, we had this great resignation that happened during the pandemic. Lots and lots of people left the job market and apparently will never return. Huh? Not sure how that actually works because there really is only so long you can disappear from the labor force. Bills to pay, games to play. How long can you stay in your parents basement before they toss you out? Point is, this great resignation was supposed to be about reinvention. They didn’t want to work for “The Man” to quote some ancient philosopher. No, they had better ideas. Work for KPMG and make a buck fifty by the time your 26? To hell with that! I am going to be an influencer! People will pay me to be a slob or to jump off a building into a vat of Molasses. Four years at some private school in Massachusetts to wear a BudLight can at the St Patricks Day parade in Boston and get paid? Hell yeah!
Obviously my point is that the great reinvention or whatever they are calling it this week is an abject failure. At some point (which will be much sooner than later) this group of well educated lazy sacks of nothingness will realize that they actually need to get a real job and join the workforce and be a functioning valuable member of society. That is when the job market will change direction and become a much bigger problem. 2023 will be that year.
It is simple to understand. We will have some sort of recession in 2023. That recession will grip everyone differently. That grip will end up putting a squeeze on people that actually are not valuable functioning members of society. How will that happen? Again, simple economics. I am a company and I have people on the payroll that are supposed to be my “Brand Ambassadors”. I pay these chuckleheads to get my brand out there. Problem is, there are 5.3 million brand ambassadors out there and everyones story is getting muddled. People are tired of looking at some girl push eyeliner. They want to see cute dogs slap cute cats in the face. It is system overload and this legion of lazy will be looking for jobs and their resume’s will be awesome: Amherst 2022… Brand Ambassador for L’Oréal. Yea, I will hire you. The end of the great whatever and the beginning of rising unemployment.
Enough of that. Markets will rebound in the second half of the year. Earnings will continue to be poisoned by inflationary numbers and people will have to do a much deeper dive into a company’s earnings and growth prospects than they previously did. It will be tricky, trust me. You look at a company’s results and 2022 will look it was the greatest year ever but reality has created a bubble of sorts as far as earning are concerned. Remember, inflation inflates everything. However, at the end of the day, the good ship America will have righted itself for the most part. It is totally in the realm of possibility that the market will end up 15-20% at the end of the year.
This estimation is based on investor psyche as much as it is on investor intelligence. A bad year generally does not carryover to the next year. Investors buy for a year to three years lets say and this low end of the cycle may look like a real buying opportunity come 2024. I don’t disagree.
How bad will the recession (which may or may not come) be? Tough one. I don’t think we will see a deep recession because I do believe the Fed will use the room they gave themselves to lower interest rates if need be. Plus, you have a federal government that not grasped the concept of debt. The bill will be due and no matter what growth you expect in the next 2 to 4 years, you will never be able to lower that debt all that much. This debt problem will become a huge story at some point because the repayment of that debt will eat up more revenue than the US Government receives. One positive, it won’t be in 2023.
POLITICS
Ugh, I write about this because I have to, not because I want to.
The Midterms are over and done with and the Republicans have a slim lead in the House and messed up their chances in the Senate so suffice it to say, I can’t see much happening in the next 18 months that will make much of an impact either way. This last spending bill may get passed, it may not. There will be some movement this year as far as leadership and some seats in the Senate will be vacated and one brand new Congressman from the Third District of New York may be ousted at some point (see yesterdays column) but overall, what you see is what you get. I will be interested to see what committees that Senator Fetterman lands on. Surely it won’t be anything too complex. His brain might explode. Honestly, 2023 may shape up to be one of the most boring political years ever. Nothing much will get done. Joe Biden may slide further into a permanent foggy state and hopefully the Chinese will not invade Taiwan. I do like to look at the positives but in politics, I don’t think that actually exists.
MUSIC
Ok, will 2023 surprise me and show creativity and add some great music? Not a chance in the World. Do I want to listen to Adele whine about another guy dumping her? Seriously? She is beautiful, talented, funny, rich and for an Englishwoman, has great teeth. Why would anyone dump her? Same with Taylor Swift. Who cares about their love lives. I don’t. Do I want more thumping baselines and some rapper telling me about his Lambo and shots of Henny? No. I do not. Because you sell millions of records, it does not make you talented, it just makes you rich. Music has literally sucked for over 30 years and I can not help myself but to bring that up every time I write.
I will totally agree that there are flashes of excellence here and there but overall, I would rather drop a needle on a scratched vinyl of King Crimson than listen to anything that has been produced in decades.
This is strictly based on my love for Rock and Roll. I like Jazz but I am no expert and I am sure there is plenty of great jazz still being recorded as well as blues for sure but what goes for popular music today is not rock and roll.
Dave Grohl talking for 15 minutes before each 4 minute song doesn’t do it for me either. Surprisingly, I do like him. I think he is very talented but just shut up and play the music for God’s sake. Same with Neil Young and Bruce Springsteen.
I cut Billy Joel slack because he tells the story behind some of his songs and tries connect the songs and their stories to the people he is playing for. Plus, he is a Long Island guy and he literally can do no wrong.
What we will see are multiple “Final Tours” of The Eagles, Elton John, Bob Seger, The Rolling Stones, etc. Until the next final final tour. Enough already. It has pretty much been decades since any of these artists have put out music that matches their stature. Is it unreasonable to expect brilliance from once brilliant artists? I just don’t get that. The most talented rock and roll stars by and large have completely lost all their creative abilities. Sure Keith Richards can still play a great guitar but did he just loose his ability to write music? Elton John hasn’t recorded anything worthwhile in over 30 years. How does that happen?
I read a lot of articles about music and have never once seen any writer address the complete black hole of music today. Older artists just rely on their past and think nothing of the present or future as far as creating. The past two generation of artists have produced very limited quality content. Is it the audience that has low expectations or do people care less about music now than they have in the past. I don’t know the answer and until I hear something to change my mind it will be Jeff beck’s Blow By Blow on my turntable for the foreseeable future.
The last thing I will say and this is very important: The Rock and Roll Hall of Fame is a joke. It will continue to be a joke until it starts abandoning this mass market approach trying to get more Rap and Hip Hop artists in. They are not rock and roll. They may sample some Rock riffs but they are not Rock and Roll. I don’t need every metal band or progressive rock band in, I just need real rock and roll in. J.Geils and War would be two bands that should start getting more and more attention. Stop mining the hip hop world to fill a quota.
The argument for allowing Rap and Hip hop artists in is not a bad one. Music has changed over the years. There were always changes from Doo-Wap to Alternative but every iteration has stayed close to rock and roll. From it’s formulaic beginning to the more complex stuff the Beatles did to Heavy Metal and beyond, it was always rock and roll. Hip Hop and Rap are not rock and roll. They are totally separate genres. Stop trying to stuff it down our throats.
IN CONCLUSION
2023 will be a mixed bag as we roll through the year. I do expect the war in Ukraine to finally have some sort of resolution and economies will stabilize a bit. Supply chain issues will probably be with us forever because that is the easiest excuse for production screwups and raising prices yet again. Inflation will have an extended stay and will probably end with a mild recession. Unemployment may become a bit of a problem later in the year. Washington will continue to be one of the Seven Gates to Hell but the damage will be modest (hopefully). Politically, decisions will have to be made. Joe Biden running again (Please God No). Will DeSantis and Trump have a sitdown and figure out what to do about this potential cluster—- for the 2024 election? Will Chuck Schumer ever shut up? As far as music in 2023, expect nothing and hopefully you will get surprised someday. Either that or put The Who’s Quadrophenia on constant play (Play it in order, from the beginning).
Good Luck and God Speed
Excellent last column for 2022!!