Globalism Is Dead And Dying At Davos

As the world prepares for a new American era to begin with the inauguration of Donald J. Trump as the 45th president of the United States, the global elites are gathered at Davos to interpret the condition of the world economy.

Ian Goldin, a professor of globalization and development at Oxford University spoke briefly at the World Economic Forum in Davos, Switzerland, saying,

“You can’t stop managing an entangled environment by disconnecting. This is the fundamental mistake of Brexit, of Trump, and of so many others. We are not simply connected. We are entangled. Our lives, our destinies are intertwined. What happens in China, what happens in Indonesia, what happens in India, what happens across Europe, and what happens in North America, across Africa and Latin America will affect all of us in dramatic new ways. The idea that somehow we can forge our future in an insular way, even for the biggest countries like the U.S., is a fantasy.”

Obviously, Mr. Goldin has been smoking too much of what he's been growing over the past couple of decades. To put it into a more precise perspective, Mr. Goldin kneels at the altar of globalization, thus, he's unprepared to express or even admit that there's any other opinion or world view than the one he personally promotes.

If one were living in a rural area in America, or India, or the Congo, even, the effects of global initiatives like those espoused and implemented by the people at Davos would be minimal, at best. One would still water plants, feed livestock, wash eggs, and perform all the other chores of a minimal farming/subsistence lifestyle. Mr. Goldin, being of the elitist character, has virtually no concept of digging holes for posts, erecting fences, germinating seed, slaughtering hogs, gathering chicken eggs daily, and so on. He's about as disconnected from the reality of everyday life as one could possibly be, viewing the world from his ivory tower at Oxford as he glances up briefly from his reading of some other obviously clueless professor emeritus or other "authority" whose mantra to which he subscribes.

Therefore, as we've seen in the Brexit movement and the election of Donald Trump as the next president of the United States of America, the globalist agenda is dead in the water, disconnected and disintegrating. The annual fete at Davos - through the media filter, at least - gives everyone an opportunity to see firsthand just how audaciously and vigorously the gathered elitists continue to promote their agendas. Liberalism, diversity, and globalism are all joined together into a kind of religion of the rich and powerful, but, the masses need not adhere to what is looking increasingly like failed policy.

If globalism has taken thirty or forty years to expand itself into monstrosities such as the European Union, the Arab Spring, and unadulterated acceptance of gay marriage, it's likely going to take an equal amount of time to dismantle its various parts and replace them with more stable value systems. As the globalists retreat from their worn-out traditions and values, popular uprisings will accelerate the decline. It starts, as do all major moral or political or economic upheavals, on the fringes of society, in the hinterlands, so to speak, before spreading to all ranges of the spectrum, from old to young, from the countryside to the cityscape.

We are at the beginning of a new age, one which promises the demise of authority at all levels from local to supranational and more freedom for the working classes and ordinary citizens.

On cue, one day before the actual inauguration of the man all the "experts" said had no chance of winning, Donald Trump, world markets continued a dizzy dance of denial and suspense, especially the Dow Jones Industrial Average, which spasmodically descended today to a point below where it began the year, closing at its lowest level since Decemeber 30 of last year (19,732.40, -72.32 (-0.37%)).

Though the drop in percentage terms was hardly sensational, the level is of more immediate concern. Since December 12, the intraday level never fell below 19,718, the mark made on the final day of trading for 2016, December 30.

While broader indices, the S&P 500 and the NASDAQ, retained a positive tilt for 2017, it has been the Dow that garnered the most attention of late, especially over its historic (failed) attempt to crack the 20,000 level.

With Trump taking the oath of office at noon tomorrow, the question on every trader's mind is how the markets will respond. With a whimper or a yawn, or might the Dow set aim again for an historic close?

At The Close 1.19.16:
Dow 19,732.40, -72.32 (-0.37%)
NASDAQ: 5,540.08, -15.57 (-0.28%)
S&P 500: 2,263.69, -8.20 (-0.36%)
NYSE Composite: 11,151.69, -44.41 (-0.40%)

Risk On - Risk Off Roller Coaster Is Expected In The Age Of Trump

Get used to volatility in the age of Trump.

Markets - especially stocks and bonds - are more than likely to correct and enter bear territory during Trump's administration. The bond bubble has been extended beyond its "use by" date and the stock rally since 2009 has been nothing short of miraculous, if one considers the creation of 11 trillion dollars (probably more) out of thin air to be the stuff of miracles.

Stocks and bonds are both overvalued, thus, we should experience a 10-year note at 3.0% or higher at some point in the near future, and stocks reversing course due to the competition and relative safety of bonds. Trump's policies are likely to exacerbate the condition of extreme overvaluation which will manifest itself in wild swings. He'll certainly get much needed help from the Fed, whose stated aim is to impose a regime of never-ending inflation.

Problem is, there are major distortions in the US and global economy, mostly the overhang from doing nothing to fix the issues of 2008 (actual bank failures). Let's see interest rates rise, stocks fall and somehow, inflation? A dubious argument at best.

Deflation is the friend of the frugal and that's what's coming. With less capital to blow on hookers and blow, the thrift-loving Americans in the heartland (forget the cesspool cities, they're toast) will benefit from all manner of liquidations and fire sales. It's a transfer of wealth from rich to poor and urban to rural that is long overdue. Most of the debt is tied to cities, not arable land and/or hunting/wilderness/undeveloped/underdeveloped properties.

One can get a unique impression from living in one of America's poorer areas, such as rural upstate New York, but you know what? Some people are thriving, those being land owners, farmers, growers, people with roadside stands, trade specialties, mechanical abilities and low overhead. It's pretty basic stuff, but large swaths of rural America are going to be very affordable and desirable. The cites, not so much. Pain for some, gain for others. The survivalist mentality had it right all along and will be proven winners in coming months and years.

As for today, two days before Mr. Trump assumes the office of president, markets were roiled again, lurching from one idea to another, up, then down, then sideways. European stocks were higher, WTI crude oil got smashed early but rebounded. Gold was flat, then lower; silver, always the outlier, hit its best level in a month, ended the day in New York down on the session, and has been trending higher into the inauguration, but options and futures settlements are closing fast (26th and 27th of January).

Mostly, stocks tread water and didn't offer much in the way of direction though by now, unless reading charts is grossly overrated, it's apparent that the Trump rally has run its course and Dow 20,000 is a fleeting memory.

At The Close 1.18.16:
Dow: 19,804.72, -22.05 (-0.11%)
NASDAQ: 5,555.65, +16.93 (0.31%)
S&P 500: 2,271.89, +4.00 (0.18%)
NYSE Composite: 11,196.11, -0.18 (-0.00%)