Market levitation slows Thursday, politics gums up the works

Stock markets still roiled by inability of Republican majority to pass almost anything major or push through crippled Trump administration’s nominees.

Cartoon by Branco. Reproduced with permission. (See link below)*

WASHINGTON, July 20, 2017 – We’re back today after another summer hiatus, which found us this time back up in Cleveland, Ohio to attend a wedding, after which we visited relatives in Pittsburgh, Pa. Frankly, it’s a breath of fresh air to leave Washington for a few days, leaving most, if not all this city’s dysfunctional politics behind.

True, we did quibble with a few true-blue Democrats at the wedding reception. They affirmed their earnest desire for the Federal government to “save” us all by endorsing single-payer national health coverage, which, as anyone with a brain already knows, was the actual aim of Obamacare.

Once the government’s monetary life-support was largely withdrawn (in 2017 no less) from insurance carriers and states that boosted Medicaid coverage (with the Obama administration’s encouragement), the true horror of the Democrats’ rammed through healthcare disaster became readily apparent.

The original Democrat-left plan was to work with newly inaugurated President Hillary Clinton to declare, “Oh, well, we tried to work with the private sector and it failed, so we’ll just throw them out and let the government run the entire healthcare industry. That’s the only way to save you, dear peasants.”

And now that inevitable time has come to pass, except that the wrong candidate won the White House, by endorsing the repealing and replacing of Obamacare, no less.

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But the current Republican majority – which has successfully been increasing its House and Senate seats since Obamacare was passed in 2010, largely by solemnly promising (wait for it!) to repeal and replace Obamacare – suddenly finds it doesn’t have the guts or the moral courage to do just that, let alone push through the President’s cabinet and agency appointees by breaking through Democrat intransigence and stalling.

True, the GOP has been passing Obamacare repeal legislation for years now – seven different attempts I heard on the radio during our return trip. But it was easy to pass this repeal legislation, even for the legion of RINOs that currently dominate the Republican side of the aisle. That’s because an Obama veto was sure to kill this legislation. This enabled the Republicans to employ that tried and true Democrat trick of fake virtue-signaling by passing legislation they knew they’d never have to account for at the ballot box.

But, oops! Donald Trump gob-smacked the fake polls and all the so-called experts in the universe by actually winning the presidency, due in great part to his own solemn promise to the Deplorables to Repeal and Replace Obamacare.

Now, wishy-washy RINO Republicans are stymieing every available attempt at compromise Obamacare legislation. At the same time, they continue to piss off Trump and the real conservatives by thwarting every single attempt to pass the legislation they all promised to pass. Seven times. Until they owned the presidency and their votes would actually count.

All this proves that Washington is really run by a single party with two fake manifestations. The Democrats and their leftist pals are all-in to destroy American democracy as quickly as possible. The Republicans – though not the most conservative Republicans – want to do the same thing, but more slowly, so they can all be dead when the final stake is driven into America’s heart.

So there we have it, and that’s where it stands today in the City of Lies, at least for now. (The President is still trying to get something done, but both parties intend for him to fail.)

As always, we delve into politics here because in many ways, it, not earnings, has been the primary influence on Wall Street since roughly 2008.

Earlier in the year, stocks rose sharply, excited by the possibilities that the Trump Administration’s three four main policy planks – repeal and replace, massive tax reform, regulatory and trade reform and immigration control – would be quickly put into place giving a massive positive stimulus to the American economy, to American business and to America’s beleaguered working and middle classes.

Trump has, in fact, actually executed a great deal of regulatory and trade reform with a flourish of his pen. Ditto immigration control, which, as we’ve said for years, is actually easy if you follow the laws already on the books. Further, for a second time, the U.S. Supreme Court has just thwarted a second leftists counterattack on Trump’s immigration restriction rules. When it comes to hitting the cycle, Trump is setting records whenever policy matters involve that Presidential Pen.

However, Obamacare repeal and replace as well as major tax reform both require the cooperation of Congress. Yet such cooperation has been a dead issue since some time during the second term of Bush II – 2007 to be precise, when the Democrats took complete control of Congress. They quickly ruled that henceforth, any legislation they passed would be 100 percent their way or the highway and the hell with what those mean and hateful Republicans thought about it. Thus it remains.

The GOP for its part, gloriously retains its World Heavyweight Title of “Stupid Party,” as its legislators, particularly in the Senate, quibble and squabble, grubbing for virtue points while failing to pass any major legislation at all.

It doesn’t help, of course, that as it’s currently constituted, the Marxist and Soros-dominated Democrat Party has no intention whatsoever to cooperate in any way with the Republican majority on passing anything, even if it helps their own blue constituency. For them, it’s all about regaining power and the hell with the country.

Thus we are left with a perpetual “Do-Nothing” Congress, the only difference today being that it’s now the GOP that’s become the “Do-Nothing” party. This vision of Republican fecklessness gives great joy to the Democrats who do their best each and every day not ever to cooperate with anything.

Largely for this reason, Wall Street has thus far remained in stasis this summer. Rightly or wrongly, most traders and investors now view those two great 2016 GOP political promises as nothing more than hot air. This is rapidly deflating launch of the hoped-for American economic growth boom.

Or, to switch analogies, Wall Street is fast morphing into a wised-up version of Charlie Brown. Having had the economic growth football pulled away from them again and again by the Lucy collective that’s currently running Congress, Wall Street’s investors and trade-meisters have rationally decided they’re not going to play that loser’s game.

The market, quite surprisingly, continues to levitate this summer, driven now by better-than-expected earnings numbers from numerous companies, minus the retail sector. Hope for any help from Washington, aside from what President Trump can accomplish with his pen, has gone the way of the dodo.

Look for the chaos to continue this summer as we flounder our way towards a very uncertain autumn. It’s likely that the current pattern of mini-rallies and mini-corrections will continue for now. At least that will make day-traders happy. But it will leave prudent investors wishing that those cheapskate U.S. banks would pay a higher rate of return on their CDs, which is where many of them remain stuck pending a more positive market outlook.

After all, who wants to get stuck in the next market crash?

*Cartoon by Branco. Reproduced with permission and by arrangement with LegalInsurrection.

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