"As Good As It Gets" - What A Difference 11 Months Makes

Authored by Robert Gore via Straight Line Logic,

What a difference eleven months make.

Shortly after Donald Trump was inaugurated he fired Michael Flynn.

What’s become the conventional subtext is that the intelligence agencies have launched a “soft coup” against Trump, he has been significantly weakened, and the Deep State has scored a major victory.

Plot Holes,” SLL, 2/26/17

Rejecting that subtext, SLL developed in “Plot Holes” and later articles a series of interrelated hypotheses. We posited that Trump was smarter and the Deep State weaker and more incompetent than generally reckoned. Also, that the Deep State’s animus towards Trump was based chiefly on fear of exposure and prosecution for its long history of corruption and criminality, not policy differences, notably concerning Russia. Finally, we suggested Trump is chiefly motivated by a drive for power. These hypotheses yielded testable predictions.

As predicted, the Russiagate investigation, based as it is on nothing, is now recognized as a monumental blunder. It forced the Deep State into the open and revealed its prosecutorial forbearance towards Hillary Clinton, its effort to help her and hinder Trump during the election, and its attempt to depose Trump afterwards. The FBI has been exposed as the antithesis of a concept implied by the word investigation: impartiality. Holdovers from the Obama Justice Department have been compromised.

The tables are turned. As the Russiagate investigation fades, Trump is left with investigatory gold mines: Uranium One, Fusion GPS, FBI and Department of Justice political meddling and obstruction of justice, Hillary Clinton’s emails, and the Clinton foundation. Trump could fire Robert Mueller with only a minor political uproar, but Mueller’s making a fool of himself to Trump’s political benefit. Why stop him?

As for those gold mines, Trump will decide if the threat of an investigation or an actual investigation best satisfies his leverage and power calculations and proceed accordingly. There has been no general swamp draining, nor will there be. Trump uses investigatory threats as a Machiavellian tactic to extract what he wants from compromised political actors in useful positions. The Clintons and James Comey, no longer in power and thus, no longer useful, are the most likely to be investigated and prosecuted.

In foreign policy, recognizing Jerusalem as the capital of Israel emphasizes Trump’s pronounced tilt toward Israel. Acquiescing to Saudi Arabia’s hapless war against Yemen and Mohammed Bin Salman’s recent purge confirms his support of that regime. In return, Israel and Saudi Arabia have sat still for Trump’s discontinuance of the US policy of supporting Islamic extremists to further regime changes (see “Powerball, Part Two”). This has meant accepting a de facto victory for the Russian-Shia alliance in Syria. US support for the Middle East’s Sunni bloc and Israel as Russian backs the Shiite bloc may lead to a standoff that brings a reduction in violence in that troubled region. It has already begun to reduce refugee flows from the area to Europe.

This is not to say that Trump’s rhetorical broadsides against Iran will stop, but the claims that the US is on the verge of war are overblown. Such a conflict would lead to a Middle East conflagration and the third officially recognized world war.

Trump’s blasts against North Korea are more problematic. His task there is more difficult than Iran; North Korea has nuclear weaponry purportedly able to strike most of the US. Trump has two options: a military strike designed to wipe out North Korea’s nuclear arsenal and Kim Jong-un’s regime, or negotiations that ratify the status quo, with Russia and China applying continuing pressure to enforce Kim’s compliance. At this point Trump may not know what he’s going to do, other than more verbal shots at North Korea and continuing displays of military strength in the region.

Trump has started no new wars. His administration has rolled back some regulations and he just won a legislative victory on tax reform. That may give him enough of a headwind to readdress Obamacare, which has neither been repealed nor replaced. He has his enemies on their back feet. Only fringe elements are still talking about impeachment. The government’s statistics indicate growth is running at above 3 percent, better than trend Obama growth, and the stock indexes keep making new records.

In 2017 SLL made contrarian, optimistic predictions for the president and pessimistic predictions for the economy and stock market (see “Hard Core Doom Porn”) We’ve been more right on the former than the latter…so far. For 2018, we’re with the minority who see clouds and thunderstorms, not silver linings. This is about as good as it gets for Trump.

Deft—by this analysis—as Trump has been, his biggest challenge lies ahead. The government is bankrupt, and demographics will push it ever-deeper in the hole. The global economy is struggling under monstrous and unsupportable debt. Fiat money something-for-nothing has a sell-by date, sooner or later the stock market and economy will head south. Historically, there’s been a tight correlation between stocks, the economy, and presidential popularity.

Is Trump Winning?” SLL, 8/6/17

Debt has been Trump’s siren song his entire career, and more than once he’s crashed on the rocks. Big triumphs have been followed by big disasters, hubris undoubtedly playing a role.

Stock market and cryptocurrency pyrotechnics have obscured an incipient bear trend in a much more important market, bonds, which in the US apparently topped out in July 2016. Falling bond prices mean rising interest rates. The world has never been more indebted; a global bear market in bonds would be toxic to equity markets and economies (and perhaps cryptocurrencies). Tellingly, high yield bond prices are diverging from rising stock prices, indicating increasing credit stress. According to David Stockman, tax reform will increase the government’s borrowing to $1.25 trillion in fiscal year 2019. Rising rates would add more to the government’s interest bill, and hit indebted businesses and individuals as well. They would offer relief to savers long abused by the Fed’s interest rate suppression tactics, but savers are a much smaller group than borrowers, and they spend less.

Rising debt and ever-expanding government are in large part responsible for a long-term decline in trend economic growth rates across the developed world. Much of what growth there has been was funded with debt. If you buy $100 dollars worth of good or services on credit you have not increased your income, your personal “gross domestic product.” If the government does the same, it registers as an increase in the gross domestic product. Back out such debt-funded “growth” and it’s unclear if there’s been any growth at all since 2009.

In the US, real incomes have stagnated since the turn of the century. Rising equity markets and falling growth rates mean that corporate valuations are in the stratosphere. Joined with off-the-chart measures of optimism and declining central bank support, equity markets are poised for a fall. That it hasn’t happened yet doesn’t mean it won’t. It’s never “different this time.” Given the leverage and speculation embedded in the market, the fall could be breathtaking, a quick drop of 50 percent or more.

As noted, falling stock markets and economies generally take the popularity of incumbent politicians with them. Trump, the most polarizing political figure since Franklin Roosevelt, is not all that popular to begin with. The Deep State that has ruled this country since World War II is down; it would be unwise to count it out. It will certainly capitalize on financial and economic turmoil to launch a counterattack against Trump.

Next year’s silver lining may be that it marks peak government. Governments have coopted much of the world’s resources and put a gigantic lien on its future production. In a severe economic contraction, the wherewithal from taxes and credit markets that would allow them to grow even bigger—and thus more intrusive and repressive—simply won’t be there.

A financial and political focal point will be pension and medical funds. Many such funds are visibly under stress. Widespread insolvency is inevitable, especially if equity and credit markets head south. The resultant fear and fury will be uncontrollable, obliterating today’s widespread, quasi-religious faith in government and its works. The upheaval would make present discord look like a picnic in the park.

It would be unwise to rely on anything but one’s own resources, family, and friends during the coming turmoil. It would be wise to shore up those defenses, and soon.

Comments

zorba THE GREEK NoPension Tue, 12/26/2017 - 20:08 Permalink

Zorba does not wish for Soros to die. At least not until after he has suffered immeasurable pain and years of humiliating degradation. A colostomy bag would suit him well, maybe some heavy radiation treatments followed by hair loss and constant nausia. Blindness may be a bit too much to hope for but diabetic nerve pain would suffice.

In reply to by NoPension

Son of Loki zorba THE GREEK Tue, 12/26/2017 - 21:15 Permalink

Considering the fierce opposition from the MSM, lefties, Hollywood perverts, DNC, deep state, half his own shit heads in the GOP...i think he has done very well esp with the Supreme Court pick.Hopefully far left radical biased Ginsberg moves to NZ or to the netherworld soon so he gets at least one more excellent choice to counter the far left Roberts.

In reply to by zorba THE GREEK

Kassandra Uncle_Cuddles Wed, 12/27/2017 - 00:45 Permalink

OT..had a family, my sister, decided to accept my Christmas invite. She showed with her fiance of 4 years.
I have not seen her since our father died in 2014.
She sent me horrible email and texts, when Trump won the election. I took the "non response" reaction...because what she was saying, referring to me, was nuts.
Christmas day, she put full size US flags in everyones stocking.
And gave everyone The Storm Before The Storm by Mike Duncan.
I have three full size flags and have not read the book yet.
Ideas, Anyone???

In reply to by Uncle_Cuddles

PacOps bamawatson Tue, 12/26/2017 - 23:22 Permalink

Meanwhile, back in Saudi Arabia ...11:27 GMTSaudi Arabia releases 23 ‘corruption detainees’ after deals with govtSaudi Arabia has released 23 of about 200 powerful individuals detained since November on corruption charges after they reached deals with the government, according to Okaz newspaper. The report on Tuesday did not name those involved in what appeared to be the first large-scale release since a group of officials was detained in a crackdown spearheaded by Crown Prince Mohammed bin Salman. The individuals have been held at Riyadh’s luxurious Ritz Carlton hotel since early November and told to hand over assets and cash in exchange for their freedom, Reuters said. More detainees would be released in the coming days and trial proceedings would begin soon for those who continue to deny the charges against them, according to Okaz.

In reply to by bamawatson

BobEore overbet Tue, 12/26/2017 - 21:39 Permalink

It only makes sense...in the upside down, nonsensical   un fun house and wilderness of mirrors what Merika has become... in the past decade..that the alt-0-right mediaz would celebrate the complete evisceration of their HOPIUM ON STEROIDS \YEAR O LVING DRUMPF/ANGEROUSLYwith a paean to ... he he heh...4D CHESS... and other classic nuggets of TARDNATION delicious delusions.And that ... instead of manning up ... to the fact that the orange-haired Roy Cohn protege in serious hock to a variety of dual citizened bearded weirdos with a vendetta against the country whose interests he is supposed to be protecting... has topped off his swath of GOLDMANITE sacks DC appointmentswith the mother of all 'Major American Mistakes Again' JERUSALEM proclamation of NOAHIDE LAW and talmudic new world ordure designed to inflame and unite an Islamic world under a covertly Sraeli led JIHAD against Merika and Merikans which will be the final nail in the coffin of a dying western world offed by it's good buddy in the s e Med... who famously said...

"Once we squeeze all we can out of the United States, itcan dry up and blow away"

they chose to pull out that rusting TRUMPMOBILE for one last victory parade...as Victor Charlie encircles the embassy from which the last, forlorn chopper pulls up its' ladder to the land o the livin... and circles away in desperate maneuver 

In reply to by overbet

Giant Meteor Tue, 12/26/2017 - 18:40 Permalink

Sound analysis me thinks ..I liked this bit most .."As for those gold mines, Trump will decide if the threat of an investigation or an actual investigation best satisfies his leverage and power calculations and proceed accordingly. There has been no general swamp draining, nor will there be. Trump uses investigatory threats as a Machiavellian tactic to extract what he wants from compromised political actors in useful positions. The Clintons and James Comey, no longer in power and thus, no longer useful, are the most likely to be investigated and prosecuted."

FIAT CON Tue, 12/26/2017 - 18:41 Permalink

"There has been no general swamp draining, nor will there be. Trump uses investigatory threats as a Machiavellian tactic to extract what he wants from compromised political actors in useful positions. The Clintons and James Comey, no longer in power and thus, no longer useful, are the most likely to be investigated and prosecuted."A little contradiction...No?

Giant Meteor FIAT CON Tue, 12/26/2017 - 18:46 Permalink

The insinuation is, the two aforementioned are no longer swamp ...The bolded part is what I liked most. As to "most likely" to be investigated or prosecuted, author may well have added, OR not at all ..Seein is believin .. I supposeI don't believe for a moment, that the don is not in peril ..Shit gets hotter by the day. Either that, or this is ome serious play acting by all parties concerned  ..I  do believe there will be some sort of live action on NK ..

In reply to by FIAT CON

Clock Crasher FIAT CON Tue, 12/26/2017 - 18:46 Permalink

Maximum worst case scenario for the swamp creatures are fines.  That's why these laws say fines and or prison. IF grand juries make indictments and IF the judges don't defend the guilty any guilty verdict will be met with fines.  Then the insurgents will rotate directly into private offices that offer massive stock options in a world of free money.  

In reply to by FIAT CON

NoPension FIAT CON Tue, 12/26/2017 - 18:51 Permalink

Threat of investigation/prosecution.

No threat. Promise ( why not?) of investigation/prosecution.

I don't think any of this would ever see a courtroom. I'll bet the singing behind closed doors, now...is enough. Just lay it in front of them...the whole story, with gory details....and present the plea deal. One shot, unconditional.

If the Swamp isn't sweating bullets, something's wrong. I'm waiting for the first " suicide ".

In reply to by FIAT CON

PT FIAT CON Tue, 12/26/2017 - 22:55 Permalink

No, the assertion is that once the old blackmailers have been neutralized, the new blackmailer can do whatever he likes with the "blackmailees".  And, if you have the keys to the photos and videos, why would you not keep the old "blackmailees"?  Most loyal employees you will ever have.  Saves you from trying to figure out how to blackmail a new bunch.No, I don't like that idea at all.  I hope something else happens.  But I think we all know what is most likely.

In reply to by FIAT CON

Clock Crasher Tue, 12/26/2017 - 18:43 Permalink

I wonder where the Trump white house packed with Goldman nutSachs fiat insurgents are going to come up with the 200 plus Trillion dollars of unbacked derivatives when this shit blows sky high.. 

nmewn Tue, 12/26/2017 - 18:52 Permalink

He's direct. He's opinionated. He's brash. He's a nationalist. He doesn't put up with any BS. Even better...Hillary-Will-Never-EVER-Be-President.Ever....and quite possibly could wind up in jail.January 15th is when "the collusion" investigation really gets going and one or moar will roll over to save their ass so, who will it be...Baker, Strzok, Page, Ohr, Comey, Preistap or McCabe?Tick tock Hillary, Yates, Clapper, Mrs.Sunstein, Rice & Brennan...tick tock ;-)

nmewn NoPension Tue, 12/26/2017 - 19:12 Permalink

Thats when the Department of Justice Office of Inspector General Michael Horowitz delivers around 1.2 million pages of documentation and evidence into the politicization of the DOJ and FBI by senior leadership and upper-level career lawyers and bureaucrats to the House Judiciary Committee. IG Horowitz has been working on it for about a year while everyone else was freaking out on Flynn & Manafort.4D chess ;-)

In reply to by NoPension

ISEEIT nmewn Tue, 12/26/2017 - 20:48 Permalink

Maybe. Hopefully.Mid January is about right. That or this is all just theater beyond our wildest speculations?Will be interesting without doubt. How will the 'media' recover from this? The truth here doesn't just fade away like a bad hair day.  

In reply to by nmewn

Duc888 Tue, 12/26/2017 - 18:56 Permalink

  " There has been no general swamp draining, nor will there be." Wanna bet?  If you know where to fucking look you can see over 4000 sealed indictments headed your way.

Deep Snorkeler Tue, 12/26/2017 - 18:59 Permalink

Trump Has Won1. all of Trump's enemies have ended up as pickled punks2. Trump isn't crazy, America is3. ultra-permissive liberalism is dead4. we worship leadership and the new financial fiesta5. corporations and Christianity are ascendant 6. the lumpen are less dependent7. our military is triumphant, our enemies in an orange Hell-broth8. ghetto-folk rejoice9. the weather tempered, ocean waters held in abeyance10. we are all enraptured with fealty and compliance with the new order11. the War on Christmas is over