- “Leviathan is wilting”…
- Honest markets vs. dishonest markets…
- Tax season is getting late. Have you learned about one key loophole in the tax code that can LEGALLY save you thousands in taxes this year?
Dear Reader,
“Leviathan is wilting.”
There you have the anxious conclusion of Bloomberg strategist Simon White.
Mr. White refers of course to leviathan government.
More from whom:
- The last five years has seen unprecedented government spending and borrowing. But while the fiscal deficit will remain relatively high for the time being, its impulse is already fading…
That is, the fiscal deluge has peaked.
High water is attained after peak rainfall — the business runs to a lagging schedule.
Yet the relenting rains represent an impulse reversal.
Though high water may still obtain, briefly, flooding is destined to recede under a diminished rainfall.
Stocks React to Changes, Not Levels
And it is the prevailing impulse that matters most:
- Stocks react to changes, not levels, and with US and global liquidity conditions materially tightening, the market is likely to continue to falter, with the bull trend in jeopardy if the economy starts to slow down with a greater intensity.
- It’s impossible to ignore the role of the government in the stock market’s post-2020 ascent. Fiscal spending has buoyed investor and consumer sentiment, and it has boosted the savings of corporations, aka profits…
- But now as the government retrenches, it takes no great logical gymnastics to venture that the market will continue to waver. And no wonder given the unparalleled positive impact sovereign borrowing has had on stocks.
Are investors prepared for a wilting Leviathan?
Or to cling to our watery theme… and as Mr. Buffett has noted:
“Only when the tide goes out do you discover who’s been swimming naked.”
Swimming Naked
I hazard many bathers will be seen in their true aspect — naked — once the fiscal tide rolls out.
And when it does?
I shall be lounging upon the reassuring sand, clad fully from stem to stern, girded against public embarrassment.
I will point to the unfolding scene of chaos… with its combination of snowish buttocks and scarlet cheeks… and I will laugh.
That is because I will feel the naked have earned their embarrassment.
They have accepted the false inducements of the fiscal and monetary authorities. These authorities, so-called, have falsely elevated the tides.
For years both trunked and trunkless wallowed joyously in the inviting water.
On Sept. 30, 2022 the Dow Jones Industrial Average tidal gauges read 28,725.
By Dec. 4, 2024 the tide had crested above 45,000… under heavy fiscal and monetary gravity.
Welfare for the Rich
Yet as I have argued before:
The manipulated financial system is a form of welfare. It is welfare not for the indigent drudge — but for the affluent stockholder.
It rewards not excellence… but existing wealth.
The man who profits from flowing financial tides believes he is a very clever fellow.
“Look at these winning stocks I’ve picked,” he gloats.
“Look at my options that have cashed in,” he gurgles.
Yet in the vast majority of instances his stock market winnings represent welfare payments.
They are giveaways. They would have likely been absent without fiscal and monetary welfare.
This Isn’t the Free Market
I am heart and soul for the free enterprise system.
Let a man present his talents and abilities before the free and open market.
Let him wrest what he can from its ruthless yet honest combats.
For this man has earned his take. Let it be the lion’s take.
Yet as I am heart and soul for the free enterprise system… I am heart and soul against the manipulated system.
I am therefore against the present system.
I believe there exists a force deep down, within a man’s liver and lights, that is against the manipulated system.
Inner Man Demands Honesty
It is a force that demands a square accounting — that demands justice.
It is a force that does not recognize the false records of the baseball player under steroidal assistance.
It is a force that does not recognize the Tour de France cycling champion who has doped his blood.
And it is a force that does not recognize falsely acquired wealth.
In this instance, the falsely acquired wealth of the falsely stimulated stock market.
I refer to the manipulated system and the honest system.
The manipulated system is arrayed actively against an honest accounting. It is arrayed actively against justice — as I see it, at least.
I concede that I may be mistaken. Yet until proven mistaken, I must be against the current system.
And that is why I must be against today’s naked swimmers who await future embarrassment.
Yet I sympathize with them.
After all, the fiscal and monetary authorities invited them to wade on into the surf… trunked or trunkless.
Who can fault them for taking to the inviting waters — for reacting to incentives?
Are You Really Ready?
The tide has receded some in recent months… to approximately 41,600.
Yet the water remains above the waist. The naked have yet to be exposed, though reports have surfaced.
But let us take you into personal consideration.
Are you secure, financially?
Are you prepared for the day when the tide rolls out? Are your swim trunks secure around your waist?
I hope for your sake they are.
Yet what if they are not?
Brian Maher
for Freedom Financial News
