Ugly! "Failure Almost Guaranteed" Regardless Of Who Wins The Election

Tyler Durden's picture

Submitted by Michael Shedlock via,

The word of the day is “ugly”. That’s how Steen Jakobsen, Saxo Bank CIO and chief economist describes the US presidential campaign, broken social contracts, public debt, and productivity.

Things are so ugly, Jakobsen says “failure is almost guaranteed” regardless of who wins the election.


This is a guest post by Steen Jakobsen. The original appears at US Election: Nothing to lose — #SaxoStrats

US Election: Nothing to Lose

My present macro speech is titled “Ugly: Don’t fight with ‘ugly’ people as they have nothing to lose”.

To me, this is the essence of the US presidential campaign. The ugly truth surrounding this ballot lies in the bigger picture, as whomever becomes president will go down in history as the “non-president” – the president who made us need, see, and demand something else.

For all of the colourful headlines, and the almost McCarthy-esque pursuit of Trump by mainstream media, this is not going to be about “Trump, the person” or his more or less moronic views; Trump merely represents the catalyst for change. He is the anti-establishment candidate, yes, but not our vision for the future.

Ultimately, Trump may still win despite (rather than because of) being… Trump.

That does not excuse mainstream media for not going after Clinton. If elected, she will be the least-liked president in US history, and I doubt any of her policies will do anything good for America.

More Barack Obama-type policy is not what the world needs. Obama may have created more jobs, but the average income for American has actually fallen during his presidency. What does this mean? It means he has presided over an economy that has created more jobs but less valuable ones, and growth during his tenure has been lower than during any other president, with the largest build-up in debt.

I am pretty sure that even this economist could create jobs with the amount of money Obama has spent!


Mind you I am 100% agnostic, politically-speaking. In fact, I don’t even think this election really matters! No, this is not a new trend; no, Clinton is not the answer… but what this is a generational repositioning and renegotiation of the social contract.

The last time that this happened was in the 1960s, when the children of World War II went for peace, love, and a lot of drugs. Now we have the Berlin Wall generation coming of age, and this time the focus is anti-globalisation and anti establishment sentiment… and yes, again a lot of drugs.

The real election issue in America, but also in Europe. is how to deal with a broken social contract. Society has been pushed so far away from its natural equilibrium in terms of markets, social homogeneity, equality, and productivity that the move back to “normal” will bear both a political price and a penalty in terms of growth and outlook.

Put differently, when we look throughout history we know that part of the process of evaluation is to smell, feel, taste, and experience what we don’t need in order to move towards what we do – a better version of society, but mainly a better one of ourselves.

The next election cycle is about protest; it will be followed by crisis and then new beginnings.

I firmly believe, and have repeatedly focused on the fact, that we as human beings need to fail in order to create a mandate for change. With regards to this dynamic, the US presidential campaign comes up short in many categories except one: failure is almost guaranteed.

If Clinton wins, the probability of a recession increases immediately and big business with return to a ’70s-like state under a Politburo-esque White House.

If Trump wins, we will have taken the fast track to massive political upheaval as the end of the Democratic/GOP monopoly on politics shifts towards a social agenda against globalisation, openness, and trade… the only good thing to come out of such a change would be the fact of change itself.

This US elections will not have any winners, only losers – but don’t despair. The US and the world economy will come back, and with surprising strength, but the political timeline is now finally aligned with the economics malaise created by central bankers. By this I mean that the corresponding low points in politics, economics, interest rates, and inflation, and the high points in terms of financial asset valuation and inequality, are coming to an end.

Volatility and uncertainty will be high the next over the next nine months (through the German election) but in the end, talk must cease and reality must reassert itself.

This is the best news of all. By accepting that the social contract is in dire need of being corrected, we could see a strong V-shaped recovery as early as the US midterm elections of 2018.

Voters are the ones with nothing to lose, not the ugly. This time around, change is what they crave; understand this and you will navigate the next election cycle with confidence.


Steen Jakobsen is chief economist and CIO at Saxo Bank

Mish Comments

Removal of a single word will make the title more accurate: “Failure Almost Guaranteed”.

  • Trade policy will be a disaster under either Hillary or Trump.
  • Hillary is far more likely to start a major war.
  • Neither has a realistic plan to reduce the deficit.
  • Hillary will not fix Obamacare, she will make it worse.
  • Congress might not let Trump start over on Obamacare.
  • Hillary will support freedom of choice, Trump won’t.

Not a Coin Toss

This is not a coin toss. Hillary’s supreme court nominations will be a guaranteed abomination.

This is a case of heads you lose, tails you lose more, possibly to the point of getting into a war with Russia under Hillary.

In disagreement with Steen’s assessment “In fact, I don’t even think this election really matters!” I propose the election does indeed matter, for several reasons, even though I agree we all lose because both candidates have serious issues.

V-Shaped Recovery?

I question Steen’s “strong V-shaped recovery” by 2018 thesis.

Why? I fail to see how we get any meaningful reform under Hillary. I also fail to see central banks doing anything other than repeating the same mistakes they have made for the past three decades.

Look at demographics in Europe and Asia. Look at housing bubbles in China, the UK, Australia, and Canada.

Structural problems are massive. Risk of a collapse in trade is very real. What is going to fix the Eurozone?

If the “V-shaped recovery” depends on a “crash” then we may indeed see a strong recovery, but from where to where, and what about pension assumptions of 8% annualized?

Yes, it’s ugly!

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Bill of Rights's picture

The only thing that will change is the day and time....the pain will come we have no other choice.

JRobby's picture

No one cares what Saxo bank says.

Fuck Saxo bank

VinceFostersGhost's picture



failure is almost guaranteed



PrayingMantis's picture


... UGLY doesn't even cut it ... just when you thought you've seen it all, the circus team of Hiliary went to new lows while she panders to latino votes with a midget at Univision ... >>> ...

... as a reminder to portorican latino voters, from a wikileaked Podesta email on Oct 15, "... The Puerto Rican treasury department paid Hillary Clinton’s campaign chairman’s brother’s firm nearly two million dollars!  The email in question is from March 2015. At that point Puerto Rican treasury had already paid Tony’s firm, The Podesta Group, the $1.9 million since enlisting the firm’s services, whatever those are, in 2013. How does a government $70 billion in debt cough up $1.9 million to pay a consultancy firm and what consulting or services was that firm providing? ...
... Tony Podesta, serving as president of The Podesta Group, emailed his brother with a subject line of “Puerto Rico.” The body of the email asked, “Can you call me today re PR. Need advice not action.” At the time Tony Podesta and other lobbyists in the firm were pushing for passage of congressional legislation to allow Puerto Rico to restructure its debt through a Chapter 9 bankruptcy filing. A few months after the email between the Podesta brothers, Clinton officially backed congressional legislation authorizing Chapter 9 proceedings. Amazing timing.
So Hillary formally backed legislation to relieve Puerto Rico of billions of dollars in debt after her campaign manager’s brother emailed him seeking “advice” and after his client had paid him $1.9 million for “services.”
He has also donated between $25,000 and $50,000 to –surprise, surprise– The Clinton Foundation. ..."

... read more here >>> 

... even Mussolini would be so jealous of such unparalleled corruption ...


Bush Baby's picture

With note - If Hillary wins, the MSM will put a happy face on it and blame the rest on the Republicans.

If Trump wins, the MSM will eat him alive


Al Bondiga's picture

"If Trump wins, the MSM will eat him alive." Yep, The Ministry of Propaganda will go after him even more than they are now. From my perspective, that's reason enough to hope the Cheeto gets installed as puppet-prez-the lulz! The circus will continue-long live the circus!
Then again, they may fall in line "for the good of the country." Though, that does not seem too likely.

Latina Lover's picture

The good news is that even if the Hellbeast wins, her political honeymoon will be non existent. At least 40% of the US population will deeply hate her, and her corruption will be the subject of commentary for years afterward. She will accomplish nothing of note.

crossroaddemon's picture

She'll accomplish whatever her handlers tell her to, and congress will play along because they answer to the same people.

roadhazard's picture

Exactly, until you remove entrenched politicians the result will always be the same.

StychoKiller's picture

After this latest rate increase from the Health Insurance Co.s, how many Decepticrats are gonna vote against their own interests for Hillay?  24% INCREASE!!! Suck it Obamatron!

Kidbuck's picture

However, the RINO pussies in both houses of congress will roll over and kiss her ass on everything she wants. Just as they did for the current affirmative action president

Infocat's picture

The political revolution about to happen in America and the west generally is a combination of several factors, the economy is not the major factor.

Kidbuck's picture

This election is a vindication of the founding fathers decision not to let women vote. By and large, women want government to perform the role of a husband or father for them. Yet, they want to brag that they are self sufficient. Note that married women are for Trump.

Paul Kersey's picture

"The only thing that will change is the day and time"

100% correct. Deep State, the unelected permanent government will retain power, regardless of who wins the election. The Lords of finance will continue to extract wealth from the commoners, through taxes, utilities fees, insurance premiums and through the justice (just us) system.

"The US and the world economy will come back, and with surprising strength"

Total garbage. Human labor capital has become just another fiat currency. New algorithms will continue to eliminate human jobs through automation. There is already a worldwide labor glut, and that glut will continue to grow at an alarming rate. Globalism has eliminated the need for middle class workers everywhere. We are at the point in this country where 75% of Americans probably don't have enough cash to buy a new set of SUV tires and still pay their monthly rent. If most folks don't have the money to buy stuff, then the economy will not come back. A debt jubilee is on its way.

Chupacabra-322's picture

Engineered Collapse. All done by design, all done by Agenda.

sgt_doom's picture

I once heard these two newly minted Economics Ph.D.s espouse their "radical" idea that the problem with the US economy was too much chaos, to much ups and downs in the markets, etc., and they were proposing a smoothly controlled system.

I contacted them and asked who put them up to this or if they were really that profoundly stupid and didn't realize that was the way the super-rich and their minions made their big bucks?

They refused to answer me, but did say I should join their organization!

Rehab Willie's picture

The only thing that will save the world economy is mass depopulation.  Too many useless eaters.


LawsofPhysics's picture

Unfortunately, this is indeed the case.  Some will have acces to the consumable calories required to maintain a high standard of living, most will not...

same as it ever was...

Stanley Lord's picture

Steen Jacobson works for a hack "bank" that cancels trades on the small speculator, who gives a damn what he says?

The Wizard's picture

By "failure" he means the financial system is going to collapse. No s**t Steen. You must be a rocket scientist. Oh, wait no, you are a bankster. If The Don gets the nod the central banksters will have the fall move quickly and blame him. If Hitlary get it the collapse will be drawn out to the best of their ability.

"Trump merely represents the catalyst for change. He is the anti-establishment candidate, yes, but not our vision for the future."

By the above statement do you mean our vision for the future should be more globalist/centrist?

LadiesLoveCoolJames's picture

I read blah blah blah blah blah. But remain in stocks and bonds because eventually it will be better than ever and the markets blah blah blah blah Porsche 911 blah blah. Fuck you paper shuffler!

LawsofPhysics's picture

Yes, that which cannot be sustained, won't be, period.

Silly humans, turns out they are the unsustainable ponzi.

"Devolution" bitchez.  Thin the fucking herd already.

LadiesLoveCoolJames's picture

Fuck yeah! Start with bankers, then fatties, fans of prog rock, wearers of skinny jeans and anyone who ever uses the word "disrupt". That should be a good start.

crossroaddemon's picture

What the fuck? Why do you care what someone wears or listens to? And the word disrupt? You're not making any sense...

LadiesLoveCoolJames's picture

It is the buzzword of choice for the entire hoodie wearing horde of Silicon Valley assholes! Fuck them and fuck you too!

BabaLooey's picture


TO: Steen "The Preen" Jackoffson - Chief Wanker at Suxo Banking Cartel

FROM: People with a Clue

SUBJECT: Directive


Fuck off. Stop.

Now. Stop.

End of message



okyoureabeast's picture

"I'm a low energy quitter who is happy complaining about what options are available for me since i'm too weak to stand up and do something about it!" - Steen Jakobsen - professional whiner. 

Nunya Bidness Gogl's picture

professional whiner, a/k/a r selected rabbit person

Long-John-Silver's picture

Obama created Jobs? 96 million people are still unemployed and are not counted because they have no chance of ever being employed again. The Obama "Recovery" is a media driven farce. We've read the Wikileaks e-mails so we now know without a doubt the so called News Outlets are nothing more than Government Propaganda Outlets. The only reason the total collapse has not happened is the Debt obama has doubled in his 8 years in office supported by the corrupt Uni-Party that's leading this nation over the cliff. 

Honest Sam's picture

The first semi-negro CAN NOT be seen as a failure.

The narrative from main stream media for decades will assure that his miniscule accomplishments, like increasing my health insurance premium by 30% to pay for those who won't pay for their own, will be touted as the work of genius.

He will be awarded a Pulitzer and another Nobel, along with an Obie, Oscar, Emmy, and Cuntry Music awards.  He is right now being measured for his gown since he will receive an honorary Ph.D in Thespianism and bullshit.

He's a prick just like his predecessors, bill clinton, and bush. 


crossroaddemon's picture

The "Obamacare insurance premiums" thing is getting old. First off, Obamacare is almost identical to Romneycare, which was instituted when Romney was the governer of Massachusets. Secondly, the Rs have had several chances to kill it... and haven't. 

The ACA would have happened regardless of POTUS. Ignoring the fact that the president is 100% controlled by the deep state and does not get to make decisions ever, if you give it a few minutes hard thought you'll realize that something like it was bound to get implemented. You were rapidly reaching a point at which NOBODY in the bottom third of wage earners could afford health care, and you had three choices. Option one: let it happen, and have poor people with kids dying because no health insurance rioting in the streets. Not gonna happen. Option two: Tear down the existing medical establishment and replace it with something that makes sense. Definitely not gonna happen; the entrenched interests that profit from the present paradgim are too powerful. Option three: slap a badly designed bandaid like the ACA over the wound and hope it doesn't get ripped off until it's somebody else's problem.

Of course they went with option 3, and would have done no matter who was in office. Health care is one issue that I can envision no non-catastrophic solution to... at least not one that is politically possible.

Nunya Bidness Gogl's picture

Dingers aside, must say I concur.

Some people still can't take their blinders off and see that there is no difference between the two parties.

Anyone who foams at the mouth about either Obama or Bush is looking too low in the power structure to correctly diagnose the problem.

StychoKiller's picture

Hmm, sounds like the Trilateral Commission's got a new member lined up!

Honest Sam's picture




".......the high points in terms of financial asset valuation and inequality, are coming to an end."


This sentence ruined your entire prediction.

Inequality is the natural state of being.  And it will remain so for eternity.   

It was proven decades ago that if every dollar of wealth, currency, gold, and other mediums of exchange were to suddenly be redistributed from the top 10% and given in equal shares to everyone all over the world, within one generation the same 10% would once again get it all back, with compound interest.


vegas's picture

This is pure comedy gold; talk about the pot calling the kettle black. Hey Steen, you want ugly? Take a fucking look at your own country disintegrating in front of your eyes to Islamic raghead extremists; if it wasn't so pathetic it would be funny. Now, go back to churning customer accounts and STFU.

A little fishy's picture

"Hillary will support freedom of choice, Trump won't" .  Are you fucking kidding me? 

Kina's picture

No this is wrong, it misses the whole point of electing Trump.

Trump maybe good, bad, indifferent or whatever as POTUS. But that doesn't matter as we all know the US economy is toast.


The whole point of choosing Trump is to break the continuous selection of Oligarch owned Washington insiders who keep the corruption going.

Trump may try to do the things he has said regarding terms, lobbyists draining the swamp etc... good if he does, but Congress will probably stop most of it.

And the more they block the stuff the public supports the more COngress gets hated.

But what Trump can do as POTUS - is highlight to the whole country the systemic corruption from top to bottom, including the media.

He also creates and environment good for independents and new minor parties for those wishing to abandon the old two party system.


TRUMP offers some hope of stopping the rot, and of normalising relations with Russia.

To go Clinton we are guaranteed of a very bad time, more war, more danger of global war, the continued erosion of public freedoms and so on.


The public has possibly much to gain from a Trump POTUS even if he is bad at it, and everything to lose under Clinton.


inosent's picture

Excellent post. I am going to steal it, but I promse to use quotes :)

Angry White Guy's picture

I believe he's actually already removed many masks of the players involved.  Hands down, he's the only one capable of doing so.

Can you imagine Jeb! or Cruz doing so?  Me neither.

ObamasYoYo's picture

we're suppose to believe a banker!  WTF, this is getting sillier by the day. 

panic is setting it in at the TOP, signs are everwhere.  bankers in his positions will be the first to go.

lamposts and rope will be in short supply...........................................................

Colonel Klink's picture

Eat a bag of cut dicks, Steen Jewcobson.

Vageling's picture

Well... Let's see if the derivatives bubble will burst this year. TBTF? We'll see. No way they can bail this one out. 

In 2000 it was the dot com, in 2008 the mortgage/cdo. Bankers didn't learn shit...

WTFUD's picture

These Bankrupt Entities to whom folks refer to as Banks are way past Fixing. Their sole purpose now is to maintain the illusion that they're a functioning entity.

That's the Target for Bonus Recipients.

DarthVaderMentor's picture

Great business turnaround artists know that the best time to take over a business is just before it collapses. The collapse and the ugliness should happen just after you take control, not before. Then you can never be faulted for anything. You take power when no one thinks you can do any good which then gives you full freedom to mold the business just as you want it. America is almost there, ready for the great turnaround artist to do his thing. 

First thing a good turnaround team does is call the accountants and the lawyers. Finding the skeletons and blaming the previous leadership is key to starting things right. Trump will first need to get a good accounting of where the money is, if there's any left after he fires the Federal Employees and cleans out the Federal Reserve. Then get the lawyers to go after and punish the guilty, fire the incompetents and claw back whatever they can get from the banksters. 

MrBoompi's picture

Unfortunately bankers have learned a lot.  They learned they will receive disclosed and undisclosed bailouts instead of being forced to liquidate and take losses.  They learned they can commit fraud on a massive scale and if caught pay measly fines for it.  They learned they can continue to launder money, including money from illegal drugs.  They learned they can pay savers .2% interest and not have their heads chopped off.  They learned borrowers will never be bailed out, unless it's them.  And they learned it makes good financial sense to pay millions for dumb speeches by presidential candidates because bribes and extortion are still effective methods of "getting stuff done".  

GoldHermit's picture

The US is in for a big rude awakening IMHO.  Neither will fix things ST, but Trump can at least put us on a new course that, if foloowed LT, will make things better.  No matter who wins I will buy more Gold/Silver.  They have beat the snot out of stocks/bonds since 2000.

daveO's picture

Agreed. I'm disliking Shedlock more w/ each article. The failure he implies is the actually the popping of the fiat/debt bubble. Only an economist would cali it a failure. It should've never been allowed.