The Bipolar Stroller
Why can't we all just get along?
"All fellow members of the Roman senate hear me. Shall we continue to build palace after palace for the rich? Or shall we aspire to a more noble purpose and build decent housing for the poor? How does the senate vote?"
Leader of the Senate, History of the World: Part I
My mother used to tell me that pretending something doesn't exist won't make it go away. It was a lesson I had to learn myself, however, as I grew into a man and accepted responsibilities for my actions. I'm a better person for it although hindsight affords a perspective that wasn't always obvious at the time. It's part of growing up, I suppose, but it's an evolution that we must embrace. As people; and as a nation.
Minyanville is a community predicated on fiscal literacy and focused on a forthright assimilation of the world around us. We traditionally steer clear of political banter as it's often subjective and rooted in agenda. The only times we'll "go there" is when they have implications for the financial markets or the psychology surrounding them. There is a fine line between acceptance and denial but therein lies the disconnect between perception and reality and, often times, profitability and loss.
I consider myself politically independent. There are issues that I'm conservative on and matters in which I'm more liberal. On the aggregate, and perhaps as a function of my chosen career path, I will offer that I used to lean to the right. Before 9/11 muddied the mindset of the masses, both sides of the aisle could agree to disagree without patriotism being called into question. That's no longer the case as our administration drives a wedge through mainstream society and raises the stakes on what's to come.
Yesterday, in a news item that failed to attract widespread coverage, the flailing left locked down the Senate for a deep dive into the intelligence surrounding the Iraq war. Republicans were quick to call the effort a desperate stunt and perhaps it was. But there was a message nestled in the muck as it highlights the growing tensions and deep-rooted discord that most of us feel but few of us say. We're a nation divided, in terms of party lines and socioeconomic status. And, from where I sit, it has the potential to manifest in a most unpleasant way.
We'll never know if the war in Iraq was truly a mistake. There is the possibility that our proactive initiative quelled terrorist uprisings and saved human lives. My sense, however, is that shock and awe alienated America and planted seeds of isolationism that have far-reaching ramifications to both the domestic economy and global balance. And the harder this administration pushes the envelope, the more likely it becomes that a crisis of confidence finally pops the psychology bubble that has been a steady source of support. In the context of a fragile debt-dependent financial fabric, it would be myopic to ignore these developments.
The president's approval rating is the lowest since the Nixon administration and support continues to wane. FEMA. Harriet Meiers. Corporatocracy. Scooterville. Twin deficits. The once impervious body armor is starting to dent and patience seems to be wearing thin. Sentiment, however, while no longer euphoric, is far from a downside disconnect of despair. The acrimony is obvious except in the capital markets as the ultimate arbiter has yet to be validated by price. The fiscal and monetary stimulus has buoyed the world's largest thermometer and rendered these concerns premature.
While my current speculative risk is leaning long (for a trade and only above S&P 1195), my internal concerns continue to weigh on my psyche. I'm admittedly nervous about our next steps as a nation as Dubya seems to be desperate. As he continues to surround himself with marionettes rather than independent and balanced thinkers, my fear is that we'll soon see another diversion that drives the collective focus away from his current woes. Perhaps it's Iran. Maybe it's the bird flu. I'm not sure but, to be brutally honest, nothing would surprise me at this point.
There is no such thing as a blue or red Minyan. We're all in this together and I share these vibes to make ye faithful aware of what's going on in my crowded keppe. As the middle class continues to evaporate and the dichotomy between the "haves" and "have nots" permeates, the probabilities of a massive sentiment shift increases in kind. It's likely not today's business and hopefully won't happen at all. But if we've learned anything during our time together, it's that hope has never been a viable investment catalyst.
Good luck today.
Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at email@example.com.
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