Actually, it doesn’t.
This week we breathlessly await the Fed’s decision on interest rates and again, it will be a big yawn.
The month of January rarely highlights anything interesting and this January was no surprise yet it’s important to look at the month as a whole, not the sum of it’s parts.
Undeniable fact number one: When January ends on the plus side, the year usually ends in the positive column. This isn’t some old wives tale, it’s a fact. When the month of January has a positive return on equities the S&P ends the year up 85% of the time. I think the average gain is over 11%.
Undeniable fact number two: A presidential election year is usually a positive one. It is positive 100% of the time when January ends on the plus side.
Undeniable fact number three: The Fed will not do anything with rates this week. Uh, I made that one up but If I were a betting man I would bet “No action” on my Fanduels betting slip.
As everyone knows by now I have a tendency to meld business and politics together more than I should. Yes, there are times when both are interconnected but most times, there is no direct connection. I apologize for that but I won’t apologize for the next part of my column.
As we move on this year, I am pretty sure that the race for the White House will be between President Joe Biden and former President Donald Trump. Unless any number of things happen in between, that should be who you see on your ballot on November 5th.
Without delving into President Biden’s feebleness and Donald Trump’s legal troubles, there are three main issues on the table as I see it:
The economy
The border
International responses to myriad situations
Since it’s Monday let’s look at the first issue and dig down a little.
To listen to the Biden administration crowing about the strength of the economy and the media support they are getting right now is just thrilling. Inflation is under control, unemployment is at the lowest levels in decades and wages are rising faster than inflation.
All true and we all need to give thanks to the Biden administration for lifting all ships (almost) and allowing the US economy to grow and prosper. Thank you Joe!
Ok, before I give myself a heart attack and cause some widespread panic you know and I know, none of that is actually true right?
Let’s pull the curtain back on President Biden’s inflation act. Uh. Joe, your policies are what caused inflation in the first place. Be it the trillions you spent when it was not needed or the closing of the Keystone pipeline project which helped lift oil prices. The Biden administration created the inflation spiral which we have spent the last two and half years trying to get out of. Like everything in life, inflation has a cycle and your administration started the cycle and time (with a nudge from the Fed) let it play out. You did nothing but cause despair for over half your administration.
Unemployment is the same thing. It is cyclical in nature and while I don’t think anyone could have prevented the onset of the massive unemployment event we went through, the natural order of things is that while recovering from that massive unemployment event (The Pandemic in case you forgot) people tend to go back to work in massive numbers. No, Joe Biden was not responsible for the unemployment nor was he responsible for the massive hiring we saw in 2022 and 2023. Please stop telling me that Biden’s policies got people back to work. They were going back to work with or without Joe Biden. It is the natural order of things in a stable vibrant economy.
I will give President Biden the credit he deserves yet i don’t think it’s enough to cast a vote for him. He has created a positive energy towards returning manufacturing to the US. Will it take hold and stay firmly in place? That is a great question.
Bringing back high paying manufacturing jobs will probably never be fully realized. Americans have gotten used to cheap products with low prices. You wonder why Dollar General and the like have done so well, because Americans like a bargain. Returning manufacturing in certain industries can work for sure but we will always be sucking on the teat of low labor cost nations.
As the weeks and months of this campaign drone on, the media will make a substantial case for Bidenomics (PUKE) and say how wonderful the economy is and how great a job President Biden did in spending the tax dollars and directing it where it was needed. Not surprisingly, the media will never even broach the subject of how are we going to pay for the trillions of dollars the administration spent trying to win back votes.
Here is another point that you will never hear and it’s kind of my point of this column, it wouldn’t matter who was in the White House, we were going to have a recovery no matter what. All the White House did was add three trillion dollars to our national debt.
The difference between what we experienced the first three years of the Trump administration and the first three years of the Biden administration is very clear. Trump helped create a raging economy by reducing taxes and reducing government interference in the course of doing business. Hands off. The Biden administration spent it’s way to this “miracle”.
It’s a long way till the election and I just feel that there are going to be some drastic things happening between now and then so there is a 33 1/3% chance that these two characters won’t be facing off against each other. That number will surely rise as we get towards the summer.
Maybe the Democrats will do the smart thing and put Joe out to pasture and bring in some new blood.
Excellent review of things to come.......