Monday, November 14, 2016


The ten year actually hit 2.30% today before falling back to 2.26%.  It's been orderly but clearly there is some real blood-letting about and may well be more before this is all over.  For a bunch who were damn near proclaiming the end of the world two weeks ago if Trump won, everyone seems to have jacked up their economic projections and with those their expectations on interest rates.  The Obama legacy is considered ruined; the Clintons dead politically; the Democratic Party shattered; Conservatism rampant.  All nonsense of course but for you non-American readers there is something quite important to keep in mind politically.  In two years we will have another election and this one will involve over 30 Senators from Trump states with a lot of those seeking reelection being Democrats.  Trump needs two decent years and if he gets them he may have an unassailable majority in the legislature over the remainder of his term.  Look for him to hit the ground running in January with his new mantra being not "The Art of the Deal" but "The Art of the Doable."  The guy will look for successes and consequently, I suspect, that the dreams of radical change held by some people on the right might not be fulfilled in the first two years of a Trump Presidency.  After 2018...look out.

Where might the problems lie?  Oddly, perhaps, I do not believe domestically.  Europe to me is a serious question mark as there is no doubt that the forces which powered BREXIT and Trump are at work which could very well result in the dissolution of the Union or at least the beginning thereof.  It is vital, I think, that European leaders recognize that an economic union is far more important than the dream (myth?) of a political union; at least one as is now envisioned.  NATO for the time being is vital and I suspect that the cadre of advisers around Trump will convince him of that.  As to claims that NATO can only survive in a strong political union...rubbish.  NATO best times were when there was no Union at all.  It is not the politics but the threat, and there is a threat exacerbated for the past eight years by--rightly or wrongly--Putin believing that Obama was an empty suit.  There will be a period of assessment on both sides as the new year start.  Trump, whether he realizes it or not has a strong hand, particularly if the pundits are correct and the economy takes off.  Whether he plays it well remains to be seen.

I'm especially interested in the Cabinet appointments for Defense and Treasury--less so for State.  Frankly, State doesn't count for much any more given its stewardship for the past eight years which has turned it into almost an after-thought.  If he gets it right and with is what is clearly a mandate of sorts the guy just might pull this off.  We'll know pretty soon.  What is quite surprising is that it appears that his gang have actually been planning this for some time in stark contrast if one would remember, to the opening months of the Obama Presidency where the rule of the day was chaos.  Who knew?  Not the the New York Times...that's for sure.  If you want to have some fun, read the Gray Lady for a few days.  She has lost it...completely lost it.  Delicious.  And thus ends my political commentary.  Back to Banking and finance...I promise.

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