I feel like right-thinking, lefty people are forgetting how awful T1 was in light of T2, but it's more that it was awful along just wildly different axes.
My suspicion is that Mnuchin and McMaster and Mattis and that lot were doing a good deal of delaying and strategic forgetfulness to blunt the impact. They aren't there now; he's just got cringing nonentities and madmen. I suspect also that he may have had some residual sense of caution because he didn't at that point know that he was legally invincible. Now he does.
Stick out a bayonet. If it hits fat, push deeper. If it hits steel, pull back and wait for another day.
do we think he's an actual-actual Russian asset? Actual-actual-actual?
Honestly, no. I think he's a Russian sympathiser, in a way that a lot of Americans (and Brits) of his generation, left and right, were. That kind of superior Le Carre/Kissinger/Taibbi cynicism of "well, Nikolai, we are not so different after all, you and I, we are each part of an imperfect system, neither of us have any claim to the moral high ground, which doesn't exist anyway, the important thing is that we work together to stop those people getting uppity". Spheres of influence, that kind of thing. They felt a lot closer to their counterparts than to all those ghastly little men in the streets raving about freedom for Hungary or an end to death squads in El Salvador.
In Trump's case I think it's coupled with a deep aesthetic fondness for the Russian system. With some men it was all that Russian-soul bullshit, Tolstoy and the ballet and so on - with Trump it's caviar and gold leaf and molesting hot Slavic chicks.
So he's an asset in the very broad sense that his existence as a powerful pro-Russia person benefits Russia. Keir Starmer is a French asset in that sense, Kaja Kallas is a Ukrainian asset.
But he's not an asset, I think, in the sense that they own him, or tell him what to do.
I think he's an asset in the sense that he gives them information illegally. That's always been enough to be called "an actual asset" in diplomatic/intelligence terms.
It doesn't even have to be illegal for you to be an asset.
https://foreignpolicy.com/2018/12/21/how-russian-money-helped-save-trumps-business/
Having captured the American state apparatus, he's no longer beholden to Russia the way he once was (aside from the mountain of kompromat they undoubtedly possess on him), but I don't see anything that argues against him being a collaborationist and a traitor. He wants to be the western hemisphere's Putin.
Is it's not illegal you're an actual asset but not an actual actual actual asset.
NYT headline: "Some Calm Returns to Markets Even as Trade Tensions Escalate"
A 3% rise at opening that recovers some portion of the recent significant losses, and following a day of wild swings of that same magnitude may be a lot of things (and be a positive development), but my God it certainly does not reflect "calm."
Calm returns to burning refinery as helicopter drops load of water.
I admit to thinking like Krugman on the tariffs. The political direction is what makes me fear for the future. The destruction of the FDA and the assault on university medical research are what is going to hurt me financially. Not being able to buy a car or having to pay twice as much for clothes will be a pain, but it's not even close to what keeps me up at night.
It is definitely wild and unexpected how T2 is managing to blaze destruction in totally different ways than T1. I feel like right-thinking, lefty people are forgetting how awful T1 was in light of T2, but it's more that it was awful along just wildly different axes.
T1 was two markedly different eras, pre-covid and post-covid. Pre-covid I could compare Trump favorably to Bush on some axes. His blinkered, isolationist foreign policy didn't result in a million dead Iraqis! His value over replacement Republican wasn't actually too bad in terms of graft and domestic policy, and was a lot more incompetent and undiplomatic about it, so we could hope that he'd get in his own way and that of future Republicans a bit!
But then covid hit, and he got absolutely everything wrong except for maybe some stuff about the vaccine effort. And he made some authoritarian noises through 2020 but he talks out both sides of his mouth literally nonstop, so however bad a threat to a democracy he was then, it got 10 times worse after Jan. 6. Like, I can imagine a timeline where he gets reelected in 2020 that's better than the current timeline, because he's kept in check by the fear of what happens if he loses a coup.
*Aside from Russia, which is so on-the-nose preposterous that it would jar you out of a book if it were fiction. Like, do we think he's an actual-actual Russian asset? Actual-actual-actual?
I think he was a they-tell-him-to-do-things-and-he-does-them sort of asset at some point, and now he's just out for himself, and he's doing enough damage to the U.S. and generally creating enough chaos in the process that they're OK with no longer having some sense of control over him.
I thought I'd written a longer comment than this in an earlier thread, but I still think the logic of the tariffs (to the extent there is any) is connected to the deportations. If you're going to cut taxes and if you cancel out whatever savings you get by cutting services through ramping up deportations, you have to get money somewhere.
I didn't expect ratcheting up talk about invading Greenland, Panama, and Canada, but military action there wouldn't pay for itself.
I think the logic is that he really does think that everyone is ripping off the US, it's the usual projection.
Aren't the Canada and Mexico tariffs back again? That is, he did a pause, but it really was only a pause.
I see yer man Bernie Sanders has once again come out in vague sort-of-opposition to the tariffs, well, to these specific tariffs anyway, he still likes tariffs in general.
I'd compromise on tariffs if that were possible, like the tariffs were somehow tied to American jobs. But obviously the tariffs we are talking about are just fucked.
If you're going to cut taxes and if you cancel out whatever savings you get by cutting services through ramping up deportations, you have to get money somewhere.
No, they can just blow up the deficit again. And deportations don't significantly save social service costs, because immigrants don't get much of those.
(On paper they are working on a budget that would pay for a significant chunk of the tax cuts, maybe half at best, with draconian cuts to Medicaid and everything else that's not Social Security. From the lobbyists my job lets me hear reports on at a few removes, they are having an extremely hard time coalescing on the actual policies of throwing millions off Medicaid this would require, and may fall back on some smaller, closer to symbolic cuts.)
That's not Medicare or Social Security, I should have said.
This is what he keeps doing, though. No one's forcing him to pop his head up and say "Mr Trump is absolutely right about the problem here, and Hillary Clinton and the Democrats are completely wrong, of course, but I have a slight disagreement with Mr Trump's approach to fixing it". Did it in 2017, still doing it.
An innocent explanation for the missing Russia tariffs may be that we don't have normal trade relations with them, currently. They may even be missing from whatever data set was used to generate the tariff table. (The former would be true of various desert islands, as well, but the latter apparently isn't. God knows these people don't know how to scrub their data.)
Sanders is out drawing big crowds with AOC. I'm willing to make charitable assumptions about his motivation.
When Sanders disagrees with normie Democrats, I usually side with the normie Democrats, but you need a big tent to win back the Sanders/RFK/Trump horseshoe voters, so I'm not inclined to attack him. AOC is a better standard-bearer for the left flank of the party though.
No, they can just blow up the deficit again. And deportations don't significantly save social service costs, because immigrants don't get much of those.
My sentence structure may have been unclear. I don't think the deportations save anything. That part of the sentence is the canceling out of savings that come from cuts elsewhere.
Oh, I see. The idea that tariffs can replace other federal taxes is indeed free-floating out there, but not as any concrete fiscal plan - it'll likely cut revenues overall, even if they don't slash rates.
Tax Foundation ran the numbers - the 4/2 tariffs would themselves raise nearly $2.9 trillion over 10 years, vs individual & corporate income tax raising the same amount last fiscal year alone ($2.96t). They don't seem to estimate how much their projected 0.7% GDP drop would hit income tax receipts, but it has to be substantial.
T2 compared to T1 is bad for me personally in the same way of not being able to look away and spending even decent chunks of my supposedly-working day trying to keep up with the atrocities of the moment.
He's not a "Russian asset" in the sense that Kim Philby was a Soviet asset, but...
Besides being POTUS, he has to maintain the appearance of being a successful businessman and a billionaire. And more or less the only financial institutions that will lend him money any more are Russian. I'm tolerably certain that Putin has made it as plain as necessary that he could drop a word in a few ears, and that line of credit would dry up. His apparent subservience to the Kremlin has very little to do with political convictions and a great deal to do with his private money problems.
Opening another avenue of direct payment for services rendered.
I feel like right-thinking, lefty people are forgetting how awful T1 was in light of T2, but it's more that it was awful along just wildly different axes.
And T1 overshadowed GW Bush, who helped people forget how bad Reagan was. I can't wait to see how Americans are going to fail to take any lesson from T2.
Having captured the American state apparatus, he's no longer beholden to Russia the way he once was (aside from the mountain of kompromat they undoubtedly possess on him),
Even the kompromat isn't such a big deal. Trump isn't planning on running for president in a fair electoral system, and what would the Russians need to have on him that's worse than what we already know?
We already know that, but we've never seen it.
I admit to thinking like Krugman on the tariffs.
The question is: What horror is going to be required to put a stop to Trumpism? We hoped it was going to be the end of Roe v. Wade. It would be nice if yanking innocent people off the street would do it, but no. War with Iran won't do it.
So tariffs and a crashing economy have become the optimistic scenario.
I see yer man Bernie Sanders has once again come out in vague sort-of-opposition to the tariffs, well, to these specific tariffs anyway, he still likes tariffs in general.
It is entirely intellectually consistent to be amenable to tariffs and think Trump is enacting tariffs idiotically. As Obama said about Iraq: "I am not opposed to all wars. I'm opposed to dumb wars."
with Trump it's caviar and gold leaf and molesting hot Slavic chicks.
Has anybody looked at the pictures of the Oval Office since Trump returned? So much gold leaf shit - just like a Trump hotel.
36: Not sure why my italics didn't work.
Krugman's work in the NYT was fine right up to the end, so I'm surprised at how much better he is on substack. It really shows the Times' institutional bias against staring at facts too directly.
Looking up something else, I found this in an NYT Krugman column.
The US invaded Iraq on March 20, 2003. This is Krugman on March 18:
So now the administration knows that it can make unsubstantiated claims, without paying a price when those claims prove false, and that saber rattling gains it votes and silences opposition. Maybe it will honorably refuse to act on this dangerous knowledge. But I can't help worrying that in domestic politics, as in foreign policy, this war will turn out to have been the shape of things to come.
35: Yeah, but all this throat-clearing "Tariffs could be great but" is fatal to a clear, consistent message that what Trump is doing is making almost everyone poor.
At the moment tariffs (as a general proposition) are down to -84% favorable among Democrats (down from -26 last August), -32 among independents (down from -20). Lean into that, Bernie and stray Blue Dogs!
way back at 11: I think he was a they-tell-him-to-do-things-and-he-does-them sort of asset at some point
My own very limited experience with Russian intelligence tells me that when Trump was doing business in Moscow -- his beauty pageants -- and trying to do bigger business there -- building a tower -- the security services will have tempted him with sex and money. (This presumes that he wasn't already in hock to Russians from previous misadventures in New York, which is probably not all that good an assumption.) Nothing that we know about Trump's character supports the idea that he would have resisted on either front. So I have drawn the same conclusion.
Certainly one of the few things he has cared about all along is screwing Ukraine. Certainly his interactions with Putin in the first term were way, way off presidential norms, even by Trump standards.
Here in the second term, I have to agree with the Dem senator who asked if he was a Russian agent, would he be doing anything differently?
33: My guess is that he'll nuclear bomb somewhere, possibly California even. God knows he longs to do it*. Then, I hope, people will start whatever form of general strike/taking to the streets that will be required to get him out of office.
My theories about how he leaves office, from most likely to least:
Thiel/Vance recruit enough cabinet members to oust him. More likely now that he's crashing their fortunes. Vance is absolutely not loyal and would seize power in a second if he thought he could.
He dies from his own health problems.
He does something unendurable (the bar for that is much higher than yanking brown people off the streets and disappearing them --or, fuck it, what do I know. Maybe high gas and egg prices are enough.) and a national standoff starts. He'll shoot some Americans in the process but I've got to hope the military won't stand by him. It'll take weeks or months.
So yeah. I'm not protesting until the third option happens. That's when it will matter.
*Heh, that stupid fucker is downwind from us, which somehow makes it all the more likely to me. He's so fucking stupid and whatever the breaking point is, it will be horrific and farcical and unbelievable when it comes.
Putting an end to Trumpism and putting an end to the Trump administration are different things, I guess. Those were my guesses about the end of the Trump administration.
Putting an end to Trumpism? We would need to get back in office, use power to actually crush the leadership, reinstate the Fairness Doctrine and enforce it, create a truly confiscatory wealth tax, give everyone else enough good shit that they notice it (AGI) and find someone with real charisma to lead it all.
Oh, among my complaints about Dem normies not using power when they could have? They should have prosecuted the fuck out of the corrupt Supreme Court justices. Which they should have, because 1. corrupt and 2. necessary to course correct.
43: I like how you bring original thinking to the big picture. I wish I shared your belief that his health would take him out, even slightly. Agree that for Americans gas prices are more likely to tip the balance than disappearing brown people, mostly because probably 2/3 of Americans are completely unaware of masked enforcers snatching people off the street and are likely to remain unaware of it.
My guess is that he'll nuclear bomb somewhere, possibly California even.
This catches the general direction of my thinking. The guy is literally threatening Canada and Greenland, and so far we haven't seen any meaningful check on his bizarre ambitions.
The 25th Amendment isn't going to come into play. He has prevented that by filling his cabinet with assholes and lunatics. I think there's a real possibility (maybe a 20% chance? I dunno) of impeachment and conviction. He's doing high crimes and misdemeanors out the wazoo, which of course doesn't really matter, but it will provide a pretext if the oligarchs rebel.
I surely don't think his lunatic and asshole cabinet will do it for any reason we would consider a good one. But Thiel/Vance might persuade them they could hold on to power (which they will surely instantly betray) and not have the crazy lurching rude man at the top. It is a risky high-stakes gambit, but I bet they're calculating odds every day.
44: oh, and audit and enforce tax law against mega-churches.
8: I see that the Dow, S&P, and NASDAQ calmly went down .8, 1.5 and 2.1 percent respectively today. Where shall we calmly tread tomorrow?
I do notice the tariff stuff is absolutely dominating their top coverage to a somewhat surprising degree (would expect it be top story, but not so overwhelmingly). Most hilariously with a story asking whether the Treasury Secretary needs better data on how people save for retirement. No, you chowderheads, he's lying and twisting the data he has.
Oh, among my complaints about Dem normies not using power when they could have? They should have prosecuted the fuck out of the corrupt Supreme Court justices. Which they should have, because 1. corrupt and 2. necessary to course correct.
Totally agree.
Also I think he dies from alzheimers in ten years.
I think there's a blue wave in two years and he's mostly neutered, and then we go back to limping along but everything works a little more poorly, oligarchs run the show more brazenly, and the supreme court is the main wrecking ball that persists.
But otherwise it's all out permanent facism.
Also Krugman on Substack has a Kevin Drum quality where he makes me feel much less panicky than, say, John Marshall. (Or Robert Reich, who also has a substack.) Like the news is the same, but Krugman evokes my thoughts more than my feelings. I subscribed to TPM but find myself avoiding it.
Drum would actively try to de-intensify the news, which isn't Krugman's shtick obviously, but they still both don't hyperventilate, even when they're worried.
I agree about the blue wave, but I also think that he has zero intention of leaving office in four years no matter what. If we are very lucky, the thing that will cause the shock and horror that provokes the general strike/constant protests/whatever it takes to get him out will be that he refuses to leave office after losing the election. If we aren't lucky, it'll be something sooner and uglier. I genuinely believe we need to be preparing for whatever it is that makes dictators leave office. Arab Spring, Hungarian Revolution. He won't leave for less.
AND ALSO, since I'm spouting off, the other thing that pisses me off about people not using power when they should have is that for most of my examples (not assassinating but I do think that would have been better than where we are headed), they were the just thing to do anyway, and fucking Obama (and Biden) shirked their responsibility. Obama should have shut down an election tainted by Russian interference no matter who (we believed) was going to win it. Had there been constant accountability along the way, we wouldn't have arrived here. But that accountability wasn't maintained because it would have looked partisan.
27: My take on Trump and Russia has also generally assumed that private financial considerations were paramount for him. And the Russians seem willing to use him as very, very imprecisely-guided flailing bomb that harms the US and the West in various ways. I would assume that with the various grifts (memecoins), Mar-A-Lago access etc that he would be less dependent on that than he had been for a long while before that. But I do not really know.
What I do notice is that there seems to be an asymmetry in at least the visible relationship. Trump has not always gone all in on Russia-friendly policies, but he does seem to go out of his way to never say a bad word about Putin, no matter what opportunity he has to do so. On the other hand, various Russians and Russian media seem to at times enjoy somewhat rubbing Trump's obsequiousness in his face, or mocking some of the negative consequences for Americans from his policies. So not Putin directly, but he seems to tolerate it. And maybe condone or even direct it? I am not well-versed enough in degree of control Putin has over things like that.
I'm pretty sure Putin hates Trump as much as you or I do. Trump is a shit and it's not possible to not enjoy pointing out that he's a shit.
People are worried about the effects of tariffs on bike prices. But bikes are parked everywhere. You can just grab one.
I thought botox wore off after a few months.
From FUNDSTRAT (some boutique analysis firm run by a guy who appears on CNBC:
".. in the last few days, we have had many conversations with macro fund managers. .. A few have quietly wondered if the President might be insane.
Gee, did you watch any of the fucking presidential campaign we just had?
Also an explainer from someone for a thing I really do not understand?
"Treasury Yields Rise Further Following Surprise Surge:
I take these are supposed to be going down and actually did at foist after tariff announcement.
https://ep.ft.com/permalink/emails/eyJlbWFpbCI6ImNiNTAxMTgzNmNlYTQ0ZjZiNDU1ZjM3YjkyNjMyYzAwZmE4NzVhIiwgInRyYW5zYWN0aW9uSWQiOiJkZjFiMWJlYy0yODcxLTQ3YTItOWNjYi0xYjNkNmIzMTBjYTAiLCAiYmF0Y2hJZCI6ImZhYjk2MTUxLWJjNGMtNDIwOS1iNzQzLWJjZjMyZjk0NjBmOSJ9
Republicans' flagship initiative this year is the extension of Trump's 2017 tax cuts. The House and the Senate are currently negotiating a budget resolution bill which they will need to agree on in order to unlock the reconciliation process. The House's plan features much more significant offsetting spending cuts than the Senate's. But under neither plan is the deficit set to fall. Even if tariffs raise revenues at the margin, the US's fiscal stance is set to remain expansionary.
60.last: OK, very basic explainer. Treasury yields = the yield on US government debt. How much you get each year if you own $100 of government debt.
Now, the confusing bit is that having a high yield sounds like it should be good. Something that costs $100 and yields $6 a year sounds better than something that costs $100 and yields $1 a year.
But that's the wrong way to think about it. When you issue a bond - in other words, when you borrow money - the yield is the answer to the question "how much do I need to pay you each year for you to lend me $100?" If you're really trustworthy and lots of people are competing to lend you money, then you won't have to pay very much. If you're dodgy as hell, you'll need to pay a lot. So high-yield bonds are also called "junk".
But of course these are bonds - they're tradeable. And that means that you work out the yield not as "annual payments over face value" but as "annual payments over market price". So if bond yields are going up, that is another way of saying bond *prices* are going down, which is another way of saying lots of people are selling them on the market and/or very few people are buying them.
Now, normally in a crisis Treasury yields go down, because US Treasuries are seen as really, really safe - they'll pay out whatever happens. So you get a "flight to safety" - everyone sells their other assets and buys Treasuries, so the price goes up and hence the yield goes down.
This isn't happening this time, and there could be various reasons.
1) People don't see Treasuries as safe this time - they think there's a risk Trump will default.
2) A lot of people are selling Treasuries for some reason, such as 1). Supply goes up, price goes down, yield goes up.
3) The market is anticipating a lot more borrowing by the US - in other words, the US will be selling a lot of Treasuries soon. Again, supply goes up.
4) Something else is happening to make US dollar-denominated assets in general less attractive - like, for example, massive tariffs prompting significant inflation in the US and a weaker dollar. That won't make a difference to a US investor's decision to hold Treasuries but it will certainly prompt a foreign investor to sell off US assets in general.
63 not at all, I had a very basic understanding and it was very helpful to see it laid out like that.
That was the right level of basic for me.
Here in the second term, I have to agree with the Dem senator who asked if he was a Russian agent, would he be doing anything differently?
Well, he wouldn't be cratering Russia's budget by driving oil down below $60/bbl.
64, 65: good! Thanks!
This article goes into a bit more detail about why it might be happening https://www.cityam.com/us-bond-market-on-the-verge-of-meltdown-as-treasury-yields-spike/
China's dumping Treasuries as retaliation, and/or banks are selling Treasuries to raise cash because their investors are withdrawing their funds, and/or there's a general loss of faith in the safe-haven status of the US.
Thanks.
I assume this is all happening calmly. The NYT has calmly decided that its top ten stories are about tariffs and their impacts.
Then more in Opinion. At least Jamelle Bouie's piece links it to the broader crisis of having a vengeance-driven, deranged criminal in the White House.
But at least we don't have an incoherent old dude as President.
"When you ran out the healthy arms -- you ran out of really healthy -- they had great arms, but they ran out. It's called sports. It's called baseball in particular. And pitchers, I guess you could say, and really particular."
From Dodger's visit.
During a recession, the Federal Reserve can be expected to cut interest rates. And corporate revenues are down. So bond prices go up and stocks go down,.
But during an inflationary shock, the fed can be expected to raise interest rates. Bond prices go down, and stock prices go up in line with inflation more or less.
The tariffs can be expected to raise prices and to cause a depression. They also seem to be ending the idea that treasuries are where you want to park your money in times of uncertainty. I don't know what to expect.
None of this disagrees with 62.
During a recession, the Federal Reserve can be expected to cut interest rates. And corporate revenues are down. So bond prices go up and stocks go down,.
But during an inflationary shock, the fed can be expected to raise interest rates. Bond prices go down, and stock prices go up in line with inflation more or less.
The tariffs can be expected to raise prices and to cause a depression. They also seem to be ending the idea that treasuries are where you want to park your money in times of uncertainty. I don't know what to expect.
None of this disagrees with 62.
Literally just hears Mohammed El-Arian saying the same thing as Robert on Radio 4. Basically the Fed has two jobs - control inflation and control unemployment. If inflation is rising the Fed raises interest rates, which puts a brake on spending - less demand, prices don't rise, inflation stops. If unemployment is rising the Fed cuts interest rates - investment is cheaper, consumption goes up, companies expand, employment rises.
Tariffs give you both high inflation and high unemployment. Pop quiz, hotshot: what do you do?
Except this time Trump is going to destroy Fed independence,* so the Fed will do something else. What, no-one knows.
*IIRC a relevant case is going to SCOTUS, re an NLRB director (?) Trump fired without cause. But I don't think that even matters: just a matter of time.
Another option, and one derasqued has been saying in another place: if you borrowed money to buy stocks (a margin loan), the big selloff in stocks means you're probably getting asked for more cash as security for the loan, because the stocks are now less security for the loan than they were (a margin call). You now need cash, fast (quite possibly within the working day), and the fastest asset to sell is Treasuries.
https://www.ft.com/content/b7c5aea6-c429-4917-bf35-a4f1b3159f85
Large institutional investors are studying options to shed stakes in illiquid private equity funds after the rout in global financial markets pummelled their portfolios, according to top private capital advisers. The calls by pensions and endowments seeking ways to exit their investments, probably at discounts to their stated value, are a bad sign for the $4tn buyout industry. Industry groups such as Blackstone, KKR and Carlyle all saw their stocks plunge between 15 per cent and more than 20 per cent on Thursday and Friday.Someone mentioned M&A lawyers? Leopards be hungry.
I was just about to try to explain the basis trade, with some trepidation, when I noticed this dude had done it already and better:
https://www.apolloacademy.com/what-is-the-basis-trade/
I have noticed that it is never a good thing when people in my current job ask me to explain things that I learned in a previous job. Like, hey, captain, can you give us a briefing on pandemics? Not good. Hi, ajay, can you explain to this crowd of derivatives markets people how modern high-intensity warfare works? Not good. Hi, ajay, you used to work in finance, I'm just a hospital administrator, what's the VIX? Not good.
Thanks to an exhausting stint of constant travel, ajay's post is now making me imagine a remix of British Airways' irritating snide-and-ironic, got-celebrities-in-it safety video. Roaring in Scots "And THIS. IS. THE BASIS TRADE!" rather than "THIS. IS. THE BRACE POSITION!"
78: This isn't really related to the topic at hand, but before I landed in pharma, I worked for Xerox fixing and servicing copiers and printers and let me tell you: you do not want anybody to know you can do that if you work in a decent-sized office.
||
Bob McManus, the trenchant editorial page editor of The New York Post and a columnist for other conservative publications who prided himself on his unambiguous common-sense commentary about public policy and other topics, died on Saturday in Manhattan. He was 81.
Thank you for making that explicit, I guess?
Usually Treasuries are quoted as shorthand for the whole bond market, but in this moment averages for other subcategories seem like they would be useful, and I haven't found them. How are non-US sovereign bonds doing? Corporate bonds in vs ex-US? US municipal bonds?
I can't hear "municipal bonds" without thinking of Robert Stack.
US corporate bond yields seem to have jumped when Treasuries did (same trend for different rating classes), but these averages aren't updated since Monday of this week.
I don't know why I was having so much trouble finding such averages yesterday. Maybe I was just on my phone then. Non-US sovereign bond yields are up but only from 2.6 to 2.66 since Friday, munis from 4.0 to 4.4., Treasuries 3.9 to 4.5.
So I'd holistically summarize as, everyone wants to cash out somewhat, but the US is particularly toxic.
Or Treasuries are still enough of an anchor that their yields going up pushes all yields up regardless of international credibility judgment.
Trump paused some of the tariffs again. Not China though. Because the way to get manufacturers to build plants in the U.S. is to fuck with things ad hoc.
A whole lot of people made a whole lot of money betting yesterday that Trump would cave on tariffs today. It's undoubtedly a good thing for some that insider trading isn't prosecuted any more.
Now one retrospectively wonders whether the rumor of the same 90-day pause earlier this week (denied by hte WH) was made-up or merely premature.
Charles Gasparino (in the "disappointed by Trump" Wall Street crowd) "reports" on X that the bond selloff was by Japanese traders.
Stock market still down 5% for the month. Thinking about whether I should sell some stock just for peace of mind.
International bond traders now have 90 days to fuck with the US economy enough that the tariffs don't come back.
"It's undoubtedly a good thing for some that insider trading isn't prosecuted any more."
Statute of limitations on insider trading is 5 years. Just gotta win the next one.
97: I sold half my stocks (80% of my tax sheltered stocks) in February. I am pondering whether the current uptick is a selling opportunity, and I think I need to see it go up a bit more. But my best guess is that this ends in tears for the stock market.
It's going to end in tears for the economy as a whole.
I mean, it's going to be a less worse time to sell, but still a worse time than last week.
My mutual funds don't update prices until end of day, but my ETF with a similar profile is now down 4.5% since the tariff announcement, after a nadir of 12%. 3.5% down since a month ago.
But probably still up like 5% from a year ago.
For my tax-sheltered accounts that I'm not going to touch for 25 years, it doesn't really bother me. Trump will be dead before I need to make withdrawals. But for the non-tax sheltered account, there's definitely some chance that I'll renovate our house or buy a new house while Trump is still in office, so it stresses me out more. But like it's still stressful no matter what I do, because he could still do something crazy that makes renovating more expensive, or he could destroy the dollar. Plus the money has to go somewhere, and there's not much that you can be sure Trump won't somehow destroy.
Ultimately the nervousness may have just as much to do with my giving up the extra $20k/year from my administrative job that I'm quitting combined with likely no summer salary in the next few years with the NSF melting down. Though there's also some positive uncertainty too, since RWM's book comes out in August and the publisher really seems optimistic about sales. Hopefully Trump doesn't find a way to fuck up the book market.
103.1: More like 2.5% going by that ETF, and 24% since the fund's inception 18 months ago. Yes, the Biden boom is no longer fully erased.
105: YES. there were some things I was hoping Harris would be able to do better than Biden, e.g. address some of the care economy issues. But nearly every week during Biden's term they would announce some new initiative or policy that was a good idea. And I only thought about him once a week.
I'd take a Mitt Romney (even the more conservative national version) over this.
Biden's the best president we've had in my lifetime by a pretty clear margin. Obama was maybe more fun, but he also made more mistakes.
Only time will tell, but Biden's mistakes (Garland, inflationary policy, complacency about the border) appear to have been far more consequential.
My payday-to-payday investment change, 3/26 to 4/9 (end of day), exclusive of contributions: -4.6%.
And now it looks like the markets have woken up & realized 10% is still a huge hike in tariffs, and we're basically embargoing China.
I had a backhouse built in 2022-2023 and it was a terrible financial decision (lumber still high, everything expensive from COVID). I still haven't seen anything that shows that I added as much value to my property as I spent. But I wanted it and it is starting to deliver the lifestyle I hoped for and I don't regret it. So I am astonished to think that I possibly built it at the last feasible opportunity and in retrospect it wasn't a terrible decision. Things will have to get impressively bad for it to have been an OK decision, but that's where we are headed.
As a bonus, I no longer have any of those "savings" or "portfolios" that are plaguing people these days.
The S&P is now down 491, or -8.7%, from 4/2. At its nadir, Tuesday close, it was down 688 or 12.1%. Inductively, Wall Street thinks the current situation is about 70% as bad as the maximal tariffs before yesterday's blink.
112: No, the nadir was still pricing in that many people still thought (correctly!) that Trump was going to cave. Maximal tariffs actually existing for more than a few hours would have dropped the S&P a lot further.
109 - of course. If Joe had run in 2016 and beat Trump, would that have killed it for good? It's really a shame that the Republican Party wasn't strong enough to kill off his candidacy in 2016.
113: We still have cave-possibility-price-in today too. I agree the total impact of the current tariffs on equities, once implemented, would be far more than 9%.
Looks like bond investors are not particularly assuaged, which also makes sense. 10-year Treasury yields only went down from 4.4% to 4.3% (4.0% before all this) overnight and are now back up to 4.36%.
Oh man. I wouldn't have voted for Biden in the 2016 primary but now how I wish we'd had eight years of him, entirely aside from Trump. I didn't know that he would turn out to be that progressive.
117: I think it was because so many of his policy staff were recommended by Warren.
I wouldn't rule out another attempt at increasing tariffs in 90 days, maybe they'll just keep turning the dial back and forth until they find some equilibrium or feel like they've amassed the power to not care about public response. I continue to think there's an underlying revenue-generating motivation* that will keep them from backing off entirely.
*With an added does of Trump insanity.
109: Only time will tell, but Biden's mistakes (Garland, inflationary policy, complacency about the border) appear to have been far more consequential.
I'd quibble on the "inflationary policy" - post Covid there was not completely non-inflationary policy and a less inflationary one almost certainly would have led to other possibly more severe economic issues (but, yes a "which horn do you want get gored by" situation). And also quite related to Obama's huge fucking mistake of under-reacting to the financial crisis and having a long slow recovery which left bad feelings (that almost certainly tipped things to Trump in the ultra close 2016 election) but gave Trump the feel good latter part of the recovery. And, of course, it probably would have left us more open to a Romeny (or whomever) win in 2012.
You can't fool me young man, it's tradeoffs all the way down.
https://www.ft.com/content/51f31a69-cbdb-4efe-96c2-409fcbe0b24a
Targeted businesses range from Russia's largest magnesium producer to its biggest car dealer. In recent weeks, the state has proceeded with confiscating assets of top warehouse owner Raven Russia and major grain exporter Rodnye Polya....Arkady Rotenberg and his brother Boris, Putin's childhood friends, have been among some of the prime beneficiaries of the prosecutor-general's seizures.A shrinking throne.
Biden did a great job with inflationary policy, we much lower inflation than all our peer countries. Sometimes you're just screwed by reality and there's nothing you can do about it. If he'd done the UK's policy the Democrats would have been wiped out, rather than barely losing.
The bond investor thing isn't really about tariffs as such, it's about the US having a mad king. It's hard to bankrupt the United States, but if anyone can do it it's Donal Trump, after all it's also hard to bankrupt casinos! I don't think there's anything short of Trump dying that will restore investor confidence in the US government, and even then you'd still need some clear evidence of the Republican party shifting back to some kind of sanity. (Note that from this viewpoint Trump 1 counts as sanity, so it's not so hard to see Republicans moving quickly back to that.)
Biden's policies set the stage for rising wages, including for the lowest paid workers, and a majority of the wealthy people decided that fascism and Jim Crow are better than workers being in a position to get real wage growth.
122: He didn't do a great job, he did an ok job. Other rich countries were hit harder because they were more dependent on Russian exports.
We are in a grand experiment to see how much ruin there really is in a nation*.
*As I think I mentioned here before, I recently learned that Smith was responding to a friend distraught over Burgoyne's loss at Saratoga
When I was in graduate school, a distinguished professor was on a visit and answering questions after a talk. This was maybe a few dozen people in a conference room. And the professor I was a GA for, a man who would later support Trump, was asking one of those questions people ask when they want someone to say how smart they are. His question started, "As Winston Churchill said, 'there's a lot of ruin in a nation...'." The distinguished professor (Ken Waltz?) stopped him short with "Winston Churchill didn't say everything. That was Adam Smith.".
I've told that story before. That's because I really like it.
As Winston Churchill said, "When I was in graduate school, a distinguished professor..."
In January, I was thinking Trump 2 trade policy was like Trump 1 trade policy: make a colossal threat, get a trivial counteroffer, declare victory.
Now I'm thinking it's actually Trump 1 Iran deal policy: Trump had to re-certify every 6* months that Iran was still in compliance. But he DIDN'T WANNA! The first couple of times the adults explained that Iran was in fact in compliance, so he had no grounds not to re-certify, so eventually, kicking and screaming, he did. But after a couple of go-rounds he still DIDN'T WANNA, so he didn't.
Now I'm thinking Trump WANNA TARIFF!, so eventually he GONNA TARIFF!
*IIRC
A whole lot of people made a whole lot of money betting yesterday that Trump would cave on tariffs today. It's undoubtedly a good thing for some that insider trading isn't prosecuted any more.
I think this actually credits the adminsitration with too much coherence. Policy is clearly being made on the fly without anyone being briefed. Insider trading in terms of some underling in the room hearing something and texting somebody, sure. As actual conscious kleptocracy, no.
131 seems awfully optimistic. No coherent policy doesn't eliminate opportunistic market manipulation.