Just when people begin to believe the worst is behind them - as in the recent market swoon, blamed on tariff fears rather than simple, obvious overvaluation - the next shoe will drop. The evidence is very clear based on recent developments, or, in the case of Ukraine and the Middle East, the lack of them.
The U.S. economy is currently at a standstill. Europe is pushing on a string while tilting over the edge of solvency into a bottomless abyss of taxes, cultural disorientation, and unfundable liabilities. Most countries in the European Union suffer from what Margaret Thatcher once expressed, "The problem with socialism is that you eventually run out of other people's money."
European governments want to start borrowing like its wartime, especially Germany and France. The UK, scarcely outside the "union" is already on the same path. More money for weapons development to defeat the oncoming Russian horde that does not exist anywhere but in the minds of politicians means less for social programs and more into the pockets of corrupt leaders and their associates.
In the U.S., President Trump's attempts to right the ship of state before it capsizes is being thwarted on three sides: congress, mainstream media, and the courts are all opposed to allowing the administration to function as it should. For its own part, the success of President Trump's first few months is being overstated. Deportations number less than 100,000, if even that amount. NBC News reported that ICE deported 11,000 migrants in February and just over 12,300 in the first four weeks of March.
For those unfamiliar with mathematics, at a wildly optimistic rate of, let's say, 50,000 a month, it would take 20 months to deport 1,000,000 illegals. Being that there are more than 10 million - and some estimates say there are as many as 30 million - it would take 200 months, or, 16 years and nine months, at a rate of 50,000 a month to clear the deck of all 10 million. In other words, "ain't gonna happen."
Thus far, Trump's plan to "Make America Great Again" has been more rhetoric than reality. Those Middle East deals he helped craft between sheiks and emirs and titans of US technology companies was a quick study of corporatocracy in action, not to be confused with corporatism or even fascism, the term most often linked to the idea of combining the force of major corporations and the state. The term "fascism" has multiple meanings, depending on the source, making the expression by historian Ian Kershaw that "trying to define 'fascism' is like trying to nail jelly to the wall," appropriate.
In any case, seeing Trump traipsing around the Mideast with an entourage of tech billionaires sends somewhat the wrong message to ordinary American citizens, and possibly an even worse on to the rest of the world. It also plays right into the hands of the liberal mass who see Trump as a potential dictator and denier of people's rights. So far, big tech companies have benefitted the most from the Trump administration's policies, the middle and lower classes, not so much.
What can be said of President Trump is that at least he appears to be trying to fix decades of poor policy decisions made by bureaucrats and politicians in the federal government's labyrinthine bureaucracy. His combative, unorthodox methods are a welcome relief from the usual off-putting by the elected and unelected Washington elitists.
Meanwhile, his "big, beautiful bill," sometimes being referenced as "B3," might better be described as a "bollocks budget boondoggle," complete with trillion dollar excess for defense, a 65% increase in funding for Homeland Security, but also an extension of the tax cuts from 2017, which are st to expire, saving middle class Americans an average of $1,700 per year. There's a lot in the 1000-page bill, including changes to Medicaid requirements, welfare, energy policies and an increase to the SALT deduction for state taxes, up to possibly $40,000 from the current $10,000. Congress seems to be focused on this last provision, hoping to pass the bill by Memorial Day, which is a bit early this year, Monday, May 26. Time is running short if congress expects to achieve that goal.
In Australia, the newly-elected government is seriously considering legislation that amounts to taxation on unrealized capital gains, a proposal that looks like a test case for WEF world population control policies.
In earnings news, Target (TGT) reported Wednesday morning, with this:
First quarter SG&A* Expense and Operating Income included $593 million in pre-tax gains from the settlement of credit card interchange fee litigation.
First quarter GAAP EPS was $2.27 compared with $2.03 last year. Adjusted EPS1, which excludes the gains from litigation settlements, was $1.30.
*SG&A: Selling, General, and Administrative Expenses
The press release was focused on small positives, like better digital sales, a partnership with Kate Spade, and increased volume on Easter and Valentine's Day (duh!), rather than the ugly reality of a year-over-year 36% EPS decline.
Serious investors aren't buying it. Target stock is down more than six percent in pre-market trading.
Lowe's (LOW) reported this morning, citing net earnings of $1.6 billion and diluted earnings per share (EPS) of $2.92 for the quarter ended May 2, 2025, compared to diluted EPS of $3.06 in the first quarter of 2024. Once again, though the EPS beat Wall Street estimates, it was lower than the previous year, a pattern seen all-too often over the past three quarters from a wide variety of publicly-traded companies.
Still, there are buyers for everything, though sentiment may be turning a bit bearish again. Lowe's shares are slightly positive prior to the open.
Gold was bid up over $3,300 and silver above $33 overnight, while WTI crude oil continues to flirt with higher prices, heading for $63 per barrel this morning. The price of crude is vastly overpriced. If anything, trading in oil the past few months has suggested a price for WTI crude should be closer to $45 than $70 and gas prices in the U.S. should be well below $3.00 nationally, while the average gallon of gas in America is currently at $3.16, according to Gas Buddy.
With markets due to open within minutes, futures are presaging a sizable drop on the bell. Dow futures are off 360, NASDAQ futures are -145, S&P futures down 38.
Beware the snake oil salespeople telling you the danger has passed. It appears to be just getting started.
At the Close, Tuesday, May 20, 2025:
Dow: 42,677.24, -114.83 (-0.27%)
NASDAQ: 19,142.71, -72.75 (-0.38%)
S&P 500: 5,940.46, -23.14 (-0.39%)
NYSE Composite: 19,942.21, -32.88 (-0.16%)
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