Coffee-shop Al glanced down at the newspaper article I had spread out before me. “Those people are nuts,” he said through his bandana-mask.
“Which people?” I inquired – wondering if he meant the Minnesota cop who had choked a minor crook to death; or the other cops who stood by while he did it; or the “peaceful demonstrators” who have been wrecking minority-owned businesses in numerous cities; or the mayors who are giving looters “space” to exercise their First Amendment rights.
But Al clarified: “I’m talking about investors in the stock markets. The country is practically coming apart at the seams. But instead of selling out, investors are buying. Markets are booming. 75% of the value lost during the Corona-crash has been regained. Analysts can’t understand why the markets are so upbeat, and neither can I.”
I folded up my paper and agreed with Al that the country looks unsettled – especially as the evening news depicts it. Politicians are blaming Mr. Trump for the riots because he’s an unregenerate racist who cares nothing about George Floyd or any other minorities. Mayor-ordered curfews are widely ignored, while rioters smash, burn and pillage with virtual impunity. National polls say Joe Biden is leading Mr. Trump by 11 points. (Otherwise, how was the play, Mrs. Lincoln?)
But Al wasn’t in a jesting mood. Everything looked like a mess, and he couldn’t understand why investors didn’t see that the house is falling down. To calm him down I led him through the history of the Trump era, starting when The Donald was still a candidate and Mrs. Clinton was cruising serenely on to a historic win as the first female president.
“Remember Hillary’s big leads in the polls?” I asked Al. “Her election was a sure thing. It was in the bag. Reporters said Trump was an idiot; that he was too dumb to tie his own shoes. He was unpredictable and untrustworthy; he was racist, misogynistic, xenophobic, homophobic – probably even hydrophobic. And that hair! Good grief! People would never elect him.”
I reminded Al of Mr. Trump’s rallies, where he promised prosperity, straight dealing, and control of our borders. Reporters couldn’t understand how that platform would be attractive to voters, so they downplayed the rallies and mocked the “deplorables” who waited for hours to get into them.
When the “stuff” (as they say) finally hit the fan – around 9 PM on November 8, 2016 – Democrats and the news media went into shock. It couldn’t be. There had to be some dark explanation for Mrs. Clinton’s loss. Mr. Trump must have cheated. Thus, before he was even sworn into office, the Russian collusion legend was born. Thereafter, his administration was buffeted by one accusation after another, including the arrest of National Security Advisor Michael Flynn, the two-year Special Prosecutor investigation, and finally the impeachment.
Nevertheless, Mr. Trump plowed on through heavy seas: issuing corrective executive orders; working with Congress to get tax reform enacted; carrying through on his promise to control the floods of illegal immigrants; and renegotiating trade agreements with foreign countries. By the time the pathetic impeachment trial played out, Mr. Trump had produced the strongest economy in US history. Unemployment rates were the lowest in 50 years – including the lowest rates ever recorded for minorities. The lower income strata had achieved major wage-gains. Stock markets were soaring. Mr. Trump looked unstoppable for re-election in November 2020.
But then, as the Bible says (regarding another matter), there arose “a tiny cloud the size of a man’s hand.”1 A mysterious new virus from China had arrived in the USA. Occupied, as they were, with impeaching and trying the president, Congress took no notice. Mr. Trump issued an order blocking all travelers from China, and was roundly denounced as a racist for doing so. Epidemiologist Dr. Anthony Fauci said the virus was no cause for worry.
Until, suddenly, we were in a full-blown crisis. Epidemic-modelers came out of the woodwork to predict a million deaths – possibly even two million – if we didn’t take immediate, drastic steps to stop the spread of the virus. A nationwide quarantine was recommended, and 40 states complied. Except for suppliers of food, most small businesses closed. Governors “ordered” us to stay home; the country’s mighty economy ground to a near-stop; and 40 million people were idled.
After shoveling $3 trillion in “stimulus” payments out the door, Congress took an extended recess. Democrat nominee Joe Biden issued befuddled statements from his basement on how Mr. Trump was doing everything wrong, and how he would do it right. Mr. Trump’s re-election prospects were fading. And idled workers were wondering how they were going to pay their bills.
On and on went the “shutdown,” with governors moving the goalposts farther out with each passing week. “When could we re-open? Could we ever re-open?” reporters asked the epidemic-gurus. Politicians ruminated about the “opportunity” to make “fundamental changes” to our society and economy. (Where have we heard that before?)
New York Governor Cuomo said we could never go back to life as it was before the virus pandemic. Reporters speculated about a permanently “masked” society and gushed about Great Depression II. Dr. Fauci warned of a “second wave,” if we reopened too soon. And over all of it resonated the Gong of Doom for the Trump presidency. He was done for; no way could he recover from this.
I reminded Al of a fundamental truth about radicals: eventually, they always go too far. Unemployed citizens across the country, who had maxed out their credit cards and spent their savings, had finally had enough. Angry crowds – including some bearing arms – stormed state capitals and demanded that they be allowed to open businesses and go back to work. Although some Democrat governors tried to extend their shutdown orders, citizens began to ignore them. Mandatory mask-orders were also widely ignored, and police refused to enforce them. It looked like the worst was over. Normalcy was returning. An upbeat spirit was abroad in the land.
But once again a disruptive event occurred in the nick of time – at least for Democrats. In Minnesota – fabled land of 10,000 lakes – an incident occurred which could not have been more perfectly timed for disruption. For reasons neither explained nor understood, the routine arrest of a black man for a relatively minor crime – i.e., passing a counterfeit $20 bill – degenerated into a confrontation in which a white police officer knelt on the neck of the handcuffed perpetrator until he choked to death. Equally inexplicably, other officers stood by and took no action.
News of the incident – including horrific video of the man’s death – sickened the country and caused widespread protests. Old tropes of America’s “irredeemable racism” were revived and repeated by politicians, ministers and race-hustlers. Once again we were in an uproar over race.
Then, true to form, the “peaceful demonstrations” turned violent. In scores of cities across the country, gangs of rioters – some of them masked and clad in black – roved through business districts smashing shop-windows, looting and burning. They overturned police vehicles and hurled stones and bottles at officers. Across the street from the White House, rioters torched the Church of Presidents – historic St. John’s Episcopal. In some cities, police were clearly ordered to stand aside while rioters looted and destroyed. Mayors continued to preach about demonstrators’ “rights” to protest racial injustice. But you didn’t need to be an ethnic studies PH-doctor to see that destroying minority-owned businesses in inner-cities hardly promoted “racial justice.”
Daytimes of more-or-less peaceful demonstrations, followed by nights of thuggish violence and destruction, have gone on for most of a week, accompanied by various political sideshows. Heaps of condemnation have been piled on Mr. Trump for (take your pick) –
- Not taking decisive action in the George Floyd case;
- Not intervening to stop the rioting;
- Threatening to send in Army units to protect Washington, DC;
- Using the rioting in DC as a political photo-op when he walked over, Bible in hand, to see the damage done to St. John’s Church; etc., etc.
Get the picture? Nothing Mr. Trump does or suggests can ever be right. Reporters and commentators are again assuring us that this time Mr. Trump is really kaput. He can’t possibly escape blame for the police brutality and the riots. Joe Biden is speechifying about “healing” the country, although some wags – obviously racists – are asking how come he and Monsignor Obama couldn’t heal the country’s racism during their 8 years in office.
Yet through all this latest uproar, investment markets have surged ever-upward, bringing us back to Al’s opening question: why is this happening instead of a crash?
Stock markets reflect the collective thinking of millions of investors, whose market-positions range from a few thousand dollars to billions. So any movement of the markets involves complex calculations of current events and future expectations. Besides all that, there is also the influence of what I call the “great bull-bears” of the market – investors whose financial positions are so large that what they do can drive the market up or down.2
It’s possible that those heavy hitters are currently leading a significant buy-in to push stock-prices up, so they can sell out at the first sign of bad news and spook smaller investors into following their lead – thus crashing the markets once again. Since the markets’ high point in February we’ve already seen several rounds of buy-sell-crash/buy-sell-crash, and more rounds might lie ahead. In some measure, this is how the big guys make the big bucks.
One factor which influences the thinking of investors is politics – especially during a presidential election-year. Investors know that Republican administrations are generally friendlier to business and working people than Democratic administrations, so they tend to keep a weather-eye on which candidate’s prospects look better as the year wears on.
Mr. Trump was riding high before the Corona-scare crashed the stock markets and the entire economy. Democrats hoped the Corona-recession would last through the election and give Joe Biden the win. But this was a contrived recession, and it looks like we are climbing out of it. According to the Labor Department’s figures for May, nonfarm payrolls rose by 2.5 million, after a 20.7 million drop in April. The jobless rate for May fell from 14.7% to 13.3%. Economists had forecasted a decline of 7.5 million in payrolls and a jump in the unemployment rate to 19%, but those predictions were far off the mark.
With businesses reopening and consumers buying again, investors are optimistic about the future. But how does this explain the week-long rally, while violence and billions of dollars in destruction continue in cities across the country? I’m not a financial guru with computer-models at my fingertips, and I’m certainly not a big enough investor to drive any markets. But I am an experienced investor and a denizen of the Normal Culture whose thinking is closely aligned with the thinking of millions of ordinary folks who believe in America enough to invest in it.
I see the pusillanimous handling of the Antifa-orchestrated riots by Democrat governors and mayors, not as an omen of doom but as a flare of hope in the darksome night – a signal assuring us that no Democrat (certainly not Joe Biden) can possibly replace Mr. Trump. Democrats’ politicization of the pandemic and the riots – their obvious willingness to hurt the country in order to defeat Mr. Trump – has demonstrated what would be in store for us with another Democrat presidency. I doubt if voters will be willing to gamble on it.
Bottom line: Investors are bidding the markets up because they are confident that voters will give Mr. Trump another 4 years to rebuild America’s economy and contend with the forces of darkness that would ruin our culture and destroy the greatest beacon of prosperity and hope in history.
“You will not fear the terror of night, nor the arrow that flies by day, nor the pestilence that stalks in the darkness, nor the plague that destroys at midday.” (Psalm 91:5-6)
- I Kings 18:44
- See “Democrats’ Miracle” – http://thebullelephant.com/democrats-miracle/