changegonnacome

The arsonist patting himself on the back for calling the fire brigade.

Trump can stay stupid longer than you can stay solvent!

Wow EUR-USD moves are pretty large......we were at $1.02 back in early Feb.....touched $1.14 today! Thing to watch now will be whether capital inflows to EUR/UK ETF's or Trusts are picking up as a sign that dollar recycling into US assets is now a dollar diversification recycle trade.....lots of good reasons now for Chinese & other foreign actors to hold non-US assets...everybody kinda knew the American exceptionalism momentum trade had played out (i think)...and if that isn't enough reason to diversify alone....let's just call it Captain Chaos diversification. I'd also say that the US is running out of policy options and is starting to look hemmed in in terms of the moves it can make.....the Fed is constrained by core elevated inflation and inflationary policies coming out of the WH....the fiscal authorities (WH & Congress) are constrained in that they most certainly can't push the envelope any more on incremental deficit spending above or beyond the nearly ~7% rate currently......simply because the mountain of existing debt with its poor maturity profile is looming large & the debt servicing would really go into death spiral. Feels like we've reached the end game in terms of being able to juice GDP growth with monetary and fiscal largesse....there is little to no incremental stimulation left to juice the economy/markets......if anything we are looking at austerity. @Pelagic thanks for these nuggets from the Woodford book....shows how belligerent Captain Chaos can be...stubborn old Grandpa for sure....but I think when presented with the abyss he's shown over time that he will step back from his own stupidity if only to make himself the saviour (never mind that he's the arsonist, in Trump's narcissistic mind he can still be the hero of every situation even the ones he self-generates) But stuff like the below is going to hurt Captain Chaos but more importantly congressional Republicans already thinking about 2026 - "Trump Tariff Surcharges Are Now Getting Added to Customer Bills" https://www.bloomberg.com/news/articles/2025-04-11/trump-tariff-surcharges-are-now-getting-added-to-customer-bills?srnd=homepage-americas&sref=7zqHEcxJ Finally - I'll say it again - China pause is incoming. The old man wants an easy life, he wants to be loved, he wants to be liked....his ego is fragile...he is not a man of true conviction & metal which would be required to tough out the pain to come from truly going through with this policy position...he's a rich kid who's had it easy his whole life..he enjoys being the centre of attention but its short lived once the consequences show up.....job losses, factory closures.....he'll see some poor SME business owner on Fox one evening when's eating McDonald's in Mar-a-lago and hear about them losing their business/home and he'll get his phone out and send out a 'Truth' announcing a pause to help the poor people getting hurt by this. The other thing I'd say....if you war game things out properly......Trump has a very big incentive to see a Republican President replace him.....which requires good stewardship of the economy........Why?...cause its a non-zero chance that the next President is a Democrat and non-zero chance that that President will be a populist of left, a populist in reaction to Trump recession/inflation......Trump will be 82yrs of age when he leaves office.....he doesn't want Federal investigations or Law fare 2.0 waiting for him.....he doesn't want the glimmer of possibility he could end up in jail in his feebled old age.....I've heard folks say that Trump 2.0 is a rebel without consequences cause he doesn't need to get re-elected....not so....IMO he might be even more politically sensitive this time around than he was the last....cause he can NEVER be President again....becoming President this time saved his bacon....he doesn't have that option this time....his best option for peace and freedom in his old age.....is a JD Vance/GOP Presidency. Trump's self-preservation genes will kick in soon and all this trade deal stuff will get tossed to JD Vance to bury deep on page 20 of the WSJ.

$2 trillion dollars of savings & full self driving coming next year!!!! Elon ‘I’ve got a bridge to sell you’ Musk. Elon remains one of the greatest promoters of stocks, stories and fairytales there’s ever been. Someday the story will come out on how the SEC, NHTSA etc were most likely closing in on him for fibbing to investors and Tesla owners who’ve been purchasing FULL self driving since 2016! I know, I know “rockets bro”…..but two things can be true at once….he’s an unequaled bullshit artist with a loose grip on what you and I might call the truth….while also being the greatest entrepreneur of his generation. I can see how Captain Chaos and him vibe together - they both create their own version of reality and so their lies don’t quite feel like real lies ( but they are).

Read this and a few other stories from American SME's with single sourcing from China....its brutal whats going to happen to them.......if something cant continue it wont. A China pause is simply inevitable.......I'm starting to get positioned for it.

If you level the MSRP up to a non-subsidized level.......and let products compete on quality, reliability, features, technology alone I dont have a problem with it......the Chinese will scare the Europeans into doing something good and vice versa......now would I let Chinese manufactures grow to be 30% of every car sold in Europe....no I wouldn't........at the moment its like 2.5%.....you shouldnt remove creative destruction from an industry.....if you do everything ends up like the DMV.

You see some of these Chinese cars - the recent BYD DiSus suspension innovation.......I want to have the FREEDOM to buy that vehicle and enjoy that technology advancement......looks like the European's have more liberty to do so than I do.....and seems like they are trying to create a level playing field while at the same time not picking winners/losers......very American of them Europeans!

Always the case….but something is stirring in Europe….Draghi report, Captain Chaos, German debt break….there’s new impetus there I haven’t seen in a while…let’s see if it translates to action

$DJT Pumper in Chief

Talking some of my own book here - but Europe will handily outperform the US for FY25

Remember 2020/2021?......well we are headed back there.......you wont be able to get stuff.....stuff you can get is way more expensive.....hard to believe we are voluntarily signing up to COVID-esque supply chain shock issues plus inflation.....hilarious

I think he's pretty high IQ and cunning as you say but cunning in a narrow subset.........cause what I think is abundantly clear.......is Trump is a better campaigner than he is a governor. Good ideas, terrible execution. I'll say it for the billion-th time......and glad to see Mark Rowan from Apollo saying the same thing yesterday......Trump's "everything, everywhere all at once" strategy on Liberation Day (tackling the whole world at the same time, on the same day on trade imbalances was simply one of the dumbest approaches to the genuine issue and good idea of re-balancing global trade. The mistake that Bill Ackman and the other tech billionaires that flocked to Trump cause ideologically he aligned with them is that they forgot that having the correct ideological view on an issue and being able to make that idea real by competent execution....is the difference between thinking about climbing Mount Everest and actually climbing Mount Everest.

No endorsement of Larry - simply saying that improvisational strategy is nice way of saying what is inherently true and this tariff rollout debacle should be confirming that and giving people Trump 1.0 deja vu...... Trump is not a competent executive in the sense that he is unable to take the kernel of a good policy like re-industrialization and actually deliver it in a structured coherent manner (as a true executive would)..and it goes to @Castanza's point on remaining independent in the tribal era......I agree with a descent subset of the President's policies......what I dont agree with ala Liberation Day is the ramshackle and frankly incompetent implementation of those policies......you can be for the President's intent on certain issues (immigration/trade) but recognize he is simply incompetent in his ability to deliver those policies......and even less so now in Trump 2.0 than 1.0.....given he's prioritized loyalty over competency in those he's surrounded himself with.

100000% Larry Summers kindly called it a "improvisational strategy".......reports show the nonsense tariff calculation was decided on the morning of Liberation day because it pleased Trump the most.....even though work had been on-going in Bessent's treasury department for months which was rooted in actual econometric analysis around purchasing power parity/currency manipulation, tariffs & non-tariff barriers.....all that was tossed......and giant gameshow bingo cards we're printed up for the President to hold that had territories on it inhabited only by penguins.

Say what you will he’s one crazy old grandpa…..the funny and frustrating kind….the one you hate but you’ll kinda miss him when he’s gone. I’d prefer him back on TV where he belongs though-

Trump now tweeting clips of one of his employees praising his courage & negotiating skills . You couldn't make it up. I'll give Trump a backhanded compliment - his ability to change his mind after doing something dumb and then spin it as win, fooling himself first, then others, is quite impressive mental gymnastics especially for an 80yr old man with old ideas. I guess it's some kind of narcissistic ego protection circuit breaker he developed in the 1980’s as each public project he touched turned to bankruptcy and then dust…..but you know big picture being able to change one's mind:direction when the facts change is admirable whatever way its done.

Agree @Gregmal re:Vol. Happy to have made a shit tonne of cash off this episode, thanks to my old vol friend OSTK now BYON and my new vol friend thanks to @Parsad in Macy's....the policy reversal ala Liz Truss was inevitable given the moves across stocks, bond & DXY were making early this week.........but sad for the country at same time......In no way can it be characterized a big picture 'win' to have equites, bonds & the US currency trade like an emerging market. The sovereign entity Trump hurt the most thus far in this trade war episode has been the United States both in the short term (biz confidence) and the mid- to longer term (predictable reliable partner etc.).....playing high tariff chicken with every nation on earth at the same time....was just one of the dumbest pieces of statecraft I've EVER EVER seen in my lifetime. It was a pointless boondoggle that hurt domestic business confidence the most. He also tipped his hand today......as blabbermouths tend do...... “The bond market is very tricky,” Trump said. “I was watching it. But if you look at it now, it’s beautiful — the bond market right now. But I saw last night where people were getting a little queasy.” The 10yr heading up into the high 4s and beyond scares the shit out this administration. The queasy persons he's referring to of course are himself and Bessent. We kind of know where the 'Trump put' is now....and it's in the bond market. Further blowing out the deficit by not actually reducing the deficit (as he's about to do with these tax cuts) is just going to increase that achilles heel further. DOGE nonsense and these tariff revenues are just not going to be enough to change the horrible budget math. Anyway IMO the next dumb Trump thing you can make money on is the inevitable China reversal - the administration might talk about trade asymmetry between the US-China and how it will hurt them more than the US.....but what they wont talk about is something a little more unquantifiable and that's pain tolerance......like we know the story.... the Chinese are over there working 9-9-6 & are saving I dunno 35% of their income.....these people know how to defer gratification & take some lumps....state surveillance & propaganda rammed down their throats will sure help keep the business community and society in-line through some bumps..........conversely Joe Sixpack has a negative savings rate of minus 2%, does 1.5hrs of real work a day for the three days a week he's in the office and spends the rest of the time complaining about how busy work is. Who's gonna crack first do you think when the going gets tough and inevitable job loses start rolling in on both sides? Put it this way - Joe Sixpack will be overthrowing Captain Chaos way before Joe Shanghai will be overthrowing Xi....and for that reason your gonna be seeing a 360 on China fairly soon....trigger point here will be headline grabbing US job losses/company closures due to lack of inputs or their cost from China. I'll be watching Fox business (as the world's busiest man the President seems to have time to do) for when the inevitable rust belt CEO's start showing up on Maria Bartiromo pleading with the President for China tariff relief as their input costs go through the roof and the closures/job losses start rolling in. President Xi knows what to do - give Captain Chaos some bright shiny PR nuggets he can 'sell' back to the MAGA base as a win.....something dumb like the last time around what was it then a TV factory?.....go bigger this time.....get Foxconn to build a phone factory in Akron,OH something tiny like 0.01% of the phones they assemble globally.....Trump can parade an American made iPhone around in the Rose garden in a years time and 'own the Libs' who said it could never be done here......sure Foxconn/Apple might have a negative 80% gross margin on these phones but who cares its a cheap tribute in the scheme of things to please 'the Don' and stop him being cray cray....Xi can tell him the TV ratings will be off the charts and his eyes will roll back in his head at the thought.

If only the world behaved as nicely in practise as it does in theory.......

Well it’s why I said that it needs to happen over many many years…..for that exact reason amongst many many others. The re-industrialization agenda should really be a bipartisan one where you would address human capital shortages with comprehensive immigration reform that was skills, industry or occupation based. You want to move to the US for economic reasons you need to work in XYZ industry that has critical skills shortages. There is a way to do it versus the rushed freewheeling that Captain Chaos is doing.

Trump is correct on the need to re-shore & re-industrial certain critical sectors......it is not wise to be so dependent on China who are fast becoming a true peer competitor. The re-industrialization project needs to be done over a longer time frame read 8-10yrs - whats the big hurry? the great mistake of Trump is he's trying to do it 24 months and using executive authority to underpin it all......this is the huge mistake he's making......the speed will cause unneeded economic chaos AND the shaky executive powers on which the whole strategy is built makes it likely to fail over the medium term as the Congress & WH changes hands.

Step one of re-industrialization is actually de-industrialization.

Yes - I think Howard was radicalized by 9/11 and what happened to his Cantor colleagues (how could you not be!)......what he did for the survivors and families of Cantor is beyond admirable....but there's an emotive America first wildness to Lutnick that from the outside looking in seems somewhat unhinged....him and Navarro are off the deep end on this isolationist self-sufficiency stuff.........I think both flame out of the Administration way before the four years ends.

Agree - every competent authority has done their homework....they (the EU, Chinese et al).....know the congressional swing districts supported by export oriented firms or States meeting the same maximum pain criteria......when the surgical countertariffs come it will look like the EU, Chinese etc. are working in unison.....but they aren't ......they simply know how to do math (unlike Captain Chaos) and they know how the Hill works. Again its another reason why Captain Chaos's Rose Garden tariff gameshow was outrageously dumb.........cause big picture its beyond dumb to line up a bunch of sovereign trade war enemies at the EXACT same time. Its a strategic mistake amongst a rogues gallery of mistakes.

If this continues I think the unthinkable could occur……DXY depreciates & the 10yr appreciates….like an emerging market economy would in a crisis. The flight to safety in Trump 2.0 is to places where a moron isn’t running the show. The only exceptional thing about the United States now is how exceptionally incompetent the leadership of the country is.