Follow The Money

The Wisconsin Supreme Court election was held yesterday with candidate Susan Crawford besting Brad Schimel in what everyone has concluded was very much a national race.  And by any measure the costliest judicial race in our country's history.

With ideological control of the court again at stake, the race shattered the record set just two years ago. Through April 1, WisPolitics tracked $107 million in overall spending through independent expenditure filings with the state, data from AdImpact, information from media buyers and sources with knowledge of the efforts. That includes $58.2 million by Schimel and those supporting him and $48.8 million by Crawford and those backing her.

Still, no donor was more influential than Elon Musk.  

The billionaire oligarch and top aide to President Trump plus two aligned PACs put in more than  $24 million, according to the WisPolitics tally. That includes $12.6 million by America PAC and another nearly $8.7 million by Building America’s Future PAC. 

Oh Boy, Howdy!

Key Points

• Records show that more than 100,000 people from all 50 states have sent money to the campaigns of liberal Susan Crawford and conservative Brad Schimel in hopes of helping them across the finish line.
• Overall, Crawford has raised more than $26 million, almost double the $14 million Schimel has raised.
• Some 77% of Crawford's donors come from outside Wisconsin, compared with only 13% of Schimel's backers. Still, both drew the bulk of their cash from Wisconsinites.
  

 

Link to excellent local coverage of the donor class for each candidate.

Election Postmortem... || Peter Zeihan

 

Don't Forecast The Election

Last week, and before I left for South Dakota for a vacation and escape from the election nonsense, an email from a neighbor showed-up asking for me to make sense of an October Market Recap he had received from his financial guy.  This was a lay-up for me and I notified my pal that I would be happy to oblige - after I had returned from my ringneck-chasing getaway.  

I emailed him last evening as my last task before going to bed bone-tired.  What follows is a distillation of what I shared:

Neighbor...

What you received from Mr. So And So, CFP® is a rather detailed recap of the investment market's out-performance for YTD 2024.  It is nicely summarized and annotated with supporting details.

Contrary to some of the political rhetoric we've been subjected-to in the run-up to the election is the fact that the US economy is on a tear in most all of the sectors that matter.  Inflation has returned to normal and I paid $2.77 last week at the Brussels BP for a tank of unleaded regular.  You needn't look any further beyond the same observations and additional stats your guy provided.  None of that data is imaginary and the markets reflect it.  You, myself and others similarly situated in the 'ownership class' (retired owners of stocks, bonds and real estate with little if any debt) benefit greatly from an economic cycle such as this.  Emancipated from raising and educating our children our focus turns-back to children, grandchildren and great-grandchildren - but without the demands of a day job.

Getting back to the markets, and pointing out something your financial guy did not address, is an interesting implication for tomorrow's election.  When the S&P 500 Index rises in the final three months before the election the incumbent party typically remains in office.  Conversely, a drop in the index has historically indicated that the opposition will claim victory.

In 12 out of the 15 presidential elections since 1926 the ruling party has benefited from a strong stock market performance in the three months leading up to the election and went on to win.  That is an 83% streak.  

While a streak such as this would signal a Harris win; a streak is nothing more than a streak.  Streaks can be broken and I happen to believe that this election is too close to call.  Even the betting markets are evenly divided tonite.

If I was still in the day job, and was communicating with my clients, I would be telling them something on this order:  'It is important to be mindful that the outcome of the election (whether it suits your personal politics or not) is not a reason to react emotionally.  That invites investment mistakes.  If you don't like the outcome of this election, there is a high probability you will be pleased with the mid-term elections in 2026.  This is because the party that loses the race for the presidency this year will likely win the House in two years putting a halt to the new President's legislative agenda.  That's just the way things happen to play-out most of the time. '

I went on the explain that polling suggests that neither party will hold a super-majority.  In other words there will be divided government much as the Founders intended.  This will require compromise.

So, as we watch the returns tonite we should remain mindful that our Constitution has survived 235 years.  This will not be the last election and if the people dislike the policies they get; they'll get around to changing them eventually.   Blah, blah, blah.

I closed with an admonition on a subject (I have blogged about many times) - that being the federal debt and deficit.  The budgets under both Trump and Biden have manifested unprecedented deficits.  Given the reality of record high employment and our country not being at war this aberration absolutely requires attention in the years ahead.

What I did not share is my skepticism over either candidate rising to this task.  So time will tell.

All I gotta say is it has been a terrific game to watch for the last 16 weeks.  Sudden Death Overtime?  Who knows?

Sometimes elections, investment markets and football, are a roll of the dice.

See you all on the flip side....

Game Of Chance

If you're reading this at the time of publication you're obviously not paying attention to more important matters - like the Packer/Texan game.  Nevertheless, as long as you're here there is this.

From time to time I've mused about the premise that the betting world is a more accurate forecast of an election outcome than traditional polling methodology.  There is reason to believe that the predictive power of a wager is not only more reactive to events as they unfold on the campaign trail but with skin in the game a wager is more accurate.

So, while traditional polls show the Harris Trump race to be a dead heat - the Vegas line tells a different story.  If you take a survey of the betting markets you will observe that (as of the time of publication)  Polymarket, Kalshi and PredictIt all favor Trump over Harris.

If the odds makers are correct, Trump will walk away with the electoral vote.

We got a game on folks.  And it ain't your ordinary Sunday football match-up.

Purple Predicter

In the Republican primary election earlier this year Nikki Haley garnered 20% of the vote total here on the peninsula. Trump, Haley and DeSantis were on the ballot and even though Haley had previously withdrawn from the race she still garnered a fifth of the Republican vote.  I wonder if anyone on Team Trump has this on their radar screen.

Why, you ask?

Because the County of Door has correctly backed every presidential winner for almost three decades, including Donald Trump in 2016 and Joe Biden in 2020.  This deeply purple peninsula has picked the winning presidential candidate since 1996.

Is it something in the water?  More likely it's something in the population dynamic.

The year-round permanent population here is only about 30,000 individuals (give or take).  Naturally not all are voters.  But the population also holds title to the highest percentage of adults over the age of 65 of any county in Wisconsin.  Not in total numbers; but as a percentage of the total population.  There's a large number of retirees who live here permanently.  Not everyone wants to live in Florida.  Florida has cockroaches as big as your hand, termites, fire ants, boa constrictors, alligators, heat, humidity, mold and rot.  If you're paying attention to the news Florida has hurricanes and flooding.  Florida is also home to nutty people who want to dictate what you check out of the library.  No way would I choose to live there.  Nevertheless, I'd visit during the Christmas or Easter holidays because Florida is home to the National Naval Aviation Museum in Pensacola and isn't as much of a fever swamp that time of year.  But I digress.  

In my discussion groups - beside me - you'd find retirees that include a business executive, dentist, molecular biologist, naval architect, doctor, civil engineer, an arson/insurance fire investigator, sheriff deputy, shipyard worker, groundwater geologist, teacher, medical examiner, constitutional lawyer, fisheries biologist and much more.  The peninsula is sorta like the Bermuda Triangle of knowledge.  A ginormous retirement brain trust. Thoughtful people choose to make their home here.  Shoot, if I had a sail boat, motor cruiser or liked to fish I'd move here when I retired.  No matter where you live you'd be fifteen minutes from a boat launch or marina.

My unscientific and casual take on this is that my neighbors and acquaintances have productive, intellectual and political conversations and are willing to share thoughts and opinions.  The basis for what they believe doesn't come from an echo chamber.  Like I said - they're thoughtful.  They engage in civil discourse and disagree without being disagreeable.  I've never lived in a place like this before.  It agrees with me. 

So, getting back to Nikki Haley; the GOP primary vote count and the up-coming 2024 election have created conditions that might be interesting.  There is much anticipation over how things will play-out.  Trump lost in 2020 yet every single down-ballot republican was elected.  All of them.  And they were in the majority too.

After the November election Nikki Haley might just say, I told you so.  Time will tell.

I think this election is too close to call and if Trump wins not much changes for me.  If he loses my expectation is that most everything will go into Sudden Death Overtime. 

You can learn more about the phenomenon of this purple county here.

We got a game on people.  Exciting stuff.

Skin In The Game

So here we are; several months since Joe Biden abdicated the throne and Vice President Harris and Governor Walz have turned the election campaign on it's head.  If you watch the polls the democrats have turned the tables in several battle ground states and possibly reversed the trend in others and nationally.  What I would give to be a fly on the wall in Trump or Harris campaign HQ.  But let's not get over our skis -  is this a sugar high, a honeymoon or an implosion?  No way to know for sure.  Besides,  polls have been sketchy the last couple-three national elections; and I happen to believe that the outcome remains a tossup.  So I want to speak to the subject of gambling, or wagering.  

I've touched-upon this subject from time to time; sometimes from the POV of a financial guy and sometimes outright humor.  Back in the first week of June I took a stab at a topic I had been reading-up on and listening about; a subject that I thought was maybe gonna gain some traction - that of actually wagering on US Elections.  With every passing week it seems to be gaining traction now that we have a real competitive campaign.

For some time government regulators with oversight on Wall Street have been trying to clamp down on growing election wagering in the US.  With a completely reconfigured presidential race a tsunami of trading on this fall's election has taken-off.  At the time of the publication of this post, traders (gamblers) favor Harris over Trump.

PredictIt, formerly a largely academic pursuit and now off-shored was witness in July to its busiest wagering volume reaching roughly 120 million contracts - a spike of more than 500% over June.  $1.1 billion has been bet on crypto-based Polymarket since June, according to Dune Analytics, and 88% of that has been political bets on the U.S. election.

Consequently, this has the increased attention of the Commodity Futures Trading Commission (CFTC) who has proposed rule-making that would expressly outlaw wagering of this sort with scattered support in the US Senate.

As a recovering financial guy with almost forty years in the wealth management biz I've seen more than my share of feeding frenzies in the equity, fixed-income, commodities, futures and other derivatives markets; and market bubbles, more often-than not, end badly.  After-which seasoned veterans, put on their boots, roll-up their sleeves, slip-on their autopsy gloves and sift thru the bloody detritus of mostly novice online traders who got themselves slaughtered chasing phantom profits.

Markets always correct.

Nevertheless, none of this is outlawed or banned.  Financial markets are regulated and there is ample opportunity for the unguided to squander their savings on dreams, brass rings or Pumpkins and Mice.  The CFTC needn't ban wagering on election outcomes as much as they might regulate them with reasonable guardrails just like any other market. 

The UK has grappled with their own tempest in a teapot with the revelation that some conservative members of parliament got caught placing bets on the timing of their recent snap election.  Did it impact the July 4th outcome?  Who knows?  Considering the level of outrage when this got found-out it's entirely possible.  Should politicians be barred from betting on elections?  Or allowed to do so at their own political peril?  

A week and a half ago, a federal judge cleared the way for Americans to place bets on the outcome of congressional elections via a prediction-market startup.  A ruling that may potentially expand further legalized wagers on elections in this country.

Wagering requires bettors to put their money where their mouth is.  Betting markets may be useful when politics are chaotic.  With skin in the game facts displace misinformation.  

We got a game-on folks....

Scapegoat

In addition to winning the Electoral College in a landslide, I won the popular vote if you deduct the millions of people who voted illegally.  Serious fraud in Virginia, New Hampshire and California.  Why isn't the media reporting on this?  Serious bias, big problem!  I will be asking for a major investigation into VOTER FRAUD.

- Donald Trump

For the very first time, in 2016, a presidential candidate (and winner) made the broad and sweeping claim of widespread illegal voting.  Trump claimed anywhere from three to five million illegal votes were cast to deprive him of a popular vote victory.  Consequently, in 2017 President Trump appointed a blue ribbon commission to find evidence of voting by undocumented immigrants in 2016.  

Without finding any evidence of these illegal votes, on January 3, 2018, President Trump issued an executive order dissolving the the Voter Fraud Commission before it could issue a final report.

A GOP-led audit in Georgia leading-up to the 2022 midterm elections found that while 1,634 non-citizens had attempted to register to vote in the state since 1997, not a single one was able to do so.  Election officials caught and prevented every single attempt.  Further evidence that existing compliance with state elections integrity works. 

Because the false claims of election fraud persist the cost of chasing election fraud falsehoods persists.  It is has already cost American taxpayers more than a half-billion dollars; and it is growing and growing.  

Without any evidence that undocumented immigrants are stealing elections why is MAGA world claiming that this is a clear and present danger to the integrity of our elections?

Occam's Razor suggests that the explanation that requires the fewest assumptions is usually best.  The Trump campaign is setting the table.  If Donald Trump loses the November election it will be illegal migrants who stole it.  Unlike Smartmatic and Dominion voting systems; faceless, undocumented immigrants cannot sue you for making baseless and unproven accusations.

If you think about it, this strategy is sublime.  

To be clear, I'm not suggesting that voter fraud doesn't happen; just not on the scale to invalidate a national election.   

Consider this:

• Non-citizens have been barred from voting in federal elections since 1924.  Additionally, in 1996 Congress made non-citizen voting in federal elections a crime punishable by fines and imprisonment.

• Under federal law a non-citizen who votes illegally can receive a prison term of up to five years and fined up to $250,000 if citizenship status was intentionally misrepresented.  There are also immigration-related consequences.  Casting just one solitary vote gets you deported.  Just being registered to vote can be the basis for denial of a citizenship application.

• Furthermore, there is a paper trail.  There are records of who votes so it is an exceedingly simple task for elections administrators, political parties and activists of all stripes to identify anyone who is ineligible. 

• Detection can also come directly through US Citizenship and Immigration Services (USCIS) who can require naturalization applicants to furnish evidence that they have never registered or voted.  Elections administrators are routinely required to produce documentation of compliance for non-citizens going through the process of becoming a naturalized citizen.

• Finally, a non-citizen who votes illegally will add one vote to the final tally.  Considering the penalties, paper trail (including a signature) and consequences of casting that one vote; is an exceedingly inefficient mechanism to steal an election.  Undocumented individuals naturally prefer to fly under the radar of government scrutiny.  This defies logic.
  

Nevertheless, if you lose an election fair and square, the undocumented are your scapegoat.  Your people have already been conditioned to believe it before a single vote has been cast.  

You read it here first.

More of the same old shtick.

____________________________________________________________________ 

Pro Tip:  If you have notice, knowledge or suspicion of election fraud, you have an obligation to report it here.

Shorter Is Better

With 66 days remaining in this year's topsy-turvy presidential election campaign - last week I shared with The Missus how much I was enjoying the change in venue.  The absolute lightness to be found in a dramatically shortened campaign season.  Restricted to only a handful of months it has a decidedly European flavor to it.  Short and sweet.

Presidential campaigns nowadays seem to start the day following the last campaign and drag-out in a long, slow, bloated, slog.

This year some of my Trump-supporting friends have been grousing and grumbling about how Kamala Harris wasn't selected by means of a presidential primary.  Consequently, democratic voters have been somehow disenfranchised and her elevation to the candidacy has been a presidential coup.  Sour grapes.  Political parties make the rules.

Frankly, if the former president, and luckiest man on the planet, hadn't dodged an assassin's bullet the GOP would be faced with the same conundrum of selecting a candidate at the last moment.

What people have forgotten is that presidential primary elections are a relatively recent phenomenon.  Immediately following the ratification of our constitution a convention of state delegates chose electors to represent their interests in the Electoral College.  The top two vote-getters in the Electoral College became president and vice president.  This worked for America's first couple of elections; but the wheels came-off with the rise of political parties after Washington left office. 

After a messy 1800 election and runoff between Jefferson and Burr, in 1804 the 12th Amendment was ratified.  Congressional caucuses were then used to pick presidential and vice presidential candidates.

With the passage of time, party nominating conventions supplanted the congressional caucuses as the mechanism for selecting nominees.  This convention system with its smokey back rooms and party bosses persisted until the 1970s.

Following the 1968 Democratic convention in Chicago both parties implemented reforms to allow voters a greater role in selecting nominees.  By 1976, roughly seventy percent of convention delegates were chosen by means of the primary election process.

By 1984, primaries had morphed into a form of grand colossus (think: Super Tuesday) where as many 40 to 60 percent of party delegates might be selected in one day. 

Naturally, when Joe Biden abdicated the throne on July 21, the campaign of Kamala Harris was restricted to less than four months.  Leaving this blogger to scratch his head and ponder why we don't do this all the time. Speaking for myself, I like a short sprint - not a long, protracted, bloated, boring, trudge that saps your interest.  You know, the same old shtick.

There are plenty of other world democracies that don't spend anywhere near the amount of time that we do on election campaigns.  French presidential races cannot begin until two weeks before the first round of voting.  In Japan it is twelve days.  The UK conducted a parliamentary election in six weeks this summer.

I think Harris is presently benefiting from a short campaign.  Yeah sure, Trump is pissed because someone moved his cheese at the last moment.  Nikki Haley saw this coming; was the Trump campaign asleep at the switch?  Hmm?  Nevertheless, this race remains a toss-up. 

Anyway, what if campaigns began after Memorial Day?  Or states held their primary on the same date?  What if we weren't subjected to Super PAC advertising ad-nauseam?  Throughout our country's history this process has continually evolved.  I think we've spent a sufficiently long-enough time in our rut and it's about time to extricate ourselves from the current primary mire.   A break-out with some open field running.  It might be good for all of us.

Just like removing a BAND-AID^®, you don't slowly pick at it.  You rip it off.  Because shorter is better.

We got a game-on.

Same Old Shtick

If I were to give some advice to Donald Trump I would suggest that he stick to policy differences between himself and VP Harris.  You know, material like border control and immigration.  The economy.  The Farm Bill.  Possibly reaching out to independent and undecided voters?  Normal policy stuff.  Meandering, off-script, streams of consciousness is bananas.  Of course, nobody listens to me.  Besides, Donald Trump is gonna do what Donald Trump gonna do.  I'm willing to bet he doesn't listen to his own campaign staff.  

(Note to self:  Start a pool on how soon before he fires them)

Meanwhile, more of the same boring, tiresome, worn-out, sour grapes, litany of grievance and victimhood.  Grousing about Biden getting out of the race and lobbing insults about Harris's race, first name and intelligence.  Refreshingly, there is a hilarious mixed-up tale about a helicopter that almost crashed.  And of course, inflation.

Now you have millions and millions of dead people, and you have people dying financially because they can't buy bacon.  They can't buy food.  They can't buy groceries.  They can't do anything.  And they're living horribly in our country right now. 

Millions and millions of dead?  For lack of bacon?  Like I said; bananas.

Then, careening and colliding like a errant billiard ball - the stock market has a hiccup and he's disappointed it didn't result in an economy-ending crash. 

We have a lot of bad things coming up. You could end up in a depression of the 1929 variety; which would have been a devastating thing.  The country is very very sick. You saw it the other day with the stock market crashing.  That was the beginning.  It's gonna get worse.  It's gonna get a lot worse, in my opinion. 

Doom and gloom.  Ordinary people resent someone coming across as rooting for the economy to do poorly.  Nothing aspirational here.  Move along.

Finally, in the spirit of mine is bigger than yours there is the peculiar obsession over crowd sizes; inexplicably picking a fight with the late, great, Martin Luther King, Jr. insisting that the civil rights leader's march on Washington was dwarfed by his January 6th rally.  You know, the rally that immediately preceded the storming of the capital and ensuing riot.

Nobody's spoken to crowds bigger than me.  If you look at Martin Luther King, when he did his speech - same real estate, same everything - we had more.

Now there is the kooky assertion that the a crowd seen at a Harris/Walz rally last week is fake.  A fabrication courtesy of Artificial Intelligence.

photo - New York Times

Has anyone noticed that Kamala CHEATED at the airport?  There was nobody at the plane, and she A.I.'d it, and showed a massive 'crowd' of so-called followers, BUT THEY DIDN'T EXIST!  She was turned in by a maintenance worker at the airport when he noticed the fake crowd picture, but there was nobody there, later confirmed by the reflection of the mirror like finish on the Vice Presidential Plane.

She's a CHEATER!

Some of you might be thinking Trump is having a breakdown or possibly gone mental.  Not me.  This baloney sucks all of the oxygen out of the room and keeps him in the media spotlight.  Furthermore, it's just one more piece of a developing back-up plan. The 'tell' is this phrase:  

She's a CHEATER!  

Trump may be crazy; but crazy like a fox.  It's never too early to be laying the groundwork for denying an election loss.  There again, that too is more of the same old shtick.

We got a game-on, people.  So, hop on the Trump Train with me.  I guarantee you the ride to November will be unpredictably entertaining.

Free Speech

It should come as no surprise that Vice President Kamala Harris has long been the target of racist and misogynistic online attacks as a consequence of her Black and South Asian ethnicity.  

As a candidate for president the gendered, sexualized and racial attacks aren't going away.  In some respects they've become worse.  In the absence of any personal restraint on the part of internet users combined with lackadaisical oversight by tech companies, the close to this election cycle will likely set a new standard for tastelessness.

Interesting to me is that of my 348 Face Book friends virtually everybody (on both sides of the aisle) have refrained from posting or reposting crude and vulgar content related to any candidate on their FB pages.  If anybody is talking politics they're going about it correctly;  sticking with policy differences, tasteful humor and witty sarcasm.  Personally, I avoid it.  If I have anything to say on politics I do it here because reading the blog is voluntary.  There is no faceless algorithm to foist it upon you.  If you're bothered or troubled about anything I publish;  don't come here.  But you already knew that.  Getting back to the subject of Face Book there are four acquaintances of mine who cannot seem to help themselves.

Moreover, the curious thing is that all four of these acquaintances have a great deal in common with me.  We're all within a year of each other in age, grew up in the same neighborhood, went to the same schools and for some the same church.  By all outward appearances they're upright citizens.  If you met them socially you'd find them personable and likeable.  Not a criminal amongst us.  But when it comes to the volatile mix of Face Book and political speech you might just think that from time-to-time they've lost their minds.

A couple of days following President Biden's abdication of the throne I spent a few moments  sampling of the Face Book pages for these four individuals and collected these screen shots.

Frankly, this sort of behavior is a turn-off.  And I don't think it's restricted to a conservative-leaning independent like me.  Many of my acquaintances who are Trump supporters likely share this sentiment.  Can you believe these are adults?

Are these four individual's under the impression that licentious posts are going to polish Donald Trump's brand?  Advance their cause?  Attract voters from the Big Fat Middle who are necessary to win an election?  It hasn't let-up either.

Thankfully it's a small number.  But Holy Cow, they've sure got a hard-on for sexualized hate speech. 

Meanwhile, last Wednesday, former President Trump questioned the racial identity of Vice President Kamala Harris during a tense appearance at the National Association of Black Journalists conference in Chicago.  He asked, Is she Indian or is she Black?  He falsely claimed that Harris, who has long identified as Black, attended a historically Black university, used to identify as Indian and then, all of a sudden, she made a turn, and she became a Black person. 

This is all part of the Trump campaign play book.  Skip the policy and dominate the media cycle.  Like I said earlier; looks like this election is game-on.

Pro Tip - Watch the Vegas Line and the odds-makers......

Fact Checking

They [Democrats] used COVID to cheat in the election and we’re never going to let it happen again.

- Donald Trump 

Nope.  More than sixty lawsuits were filed over the 2020 election and not a single court identified widespread fraud.

Diversity, Equity and Inclusion

Popularly known as DEI.  In the human resources world this includes any policy or initiatives designed to make employees of various backgrounds feel welcome and ensure they have support to perform to the fullest of their abilities in the workplace.  It is also a pejorative in the MAGA universe.

On small battlefields in the Culture War it is social engineering initiatives such as these that are often used to keep the troops in a constant state of turgid arousal and agitation.  For me, not so much.  DEI doesn't set my teeth on edge or make me want to set my hair on fire.  If a business seeks to be successful the path to that end is a happy workplace and workforce.  From a purely political point of view this sort of stuff cuts both ways.  Allow me to explain.

There's been some chatter that Kamala Harris is where she is (she is not yet the official nominee) as a consequence of her being a person of color.   A child of a Jamaican (African) father and Asian (Indian) mother (both university professors) she has brown skin.  Consequently, culture warriors suggest she skipped the line because she has somehow benefited from DEI and thusly her career advances and rise in politics are not meritorious.

Consider this.  JD Vance has a compelling life story.  Scottish-Irish descent, born to a single mother addicted to drugs, raised by a grandmother in an economically disadvantaged community.  A hillbilly.  His life story is impressive; none which would be remarkable if he was raised by an intact middle class household.  If you read his book, or watch the Hollywood movie you would learn that he went to law school on Yale's scholarship program for the economically disadvantaged.  Yup, an elite university's affirmative action program. 

You might also conclude that his meteoric political rise has been a version of political DEI.  Between you and me I happen to believe all veep candidates are chosen for a reason.  That's just how it goes.  Nevertheless, DEI cuts both ways.  And Speaker Johnson has wisely suggested to some of the members of his caucus that they cool their jets on the subject; it's counter-productive.  Moreover, if you think it is a brilliant strategy to suggest that Kamala Harris slept her way to the top you might as well write-off the suburban woman vote and go home.  But I digress.

For the record, I happen to think JD Vance is a smart guy who merited a scholarship.  He is imminently qualified  I also happen to think that Kamala Harris is a smart woman who won three elections:  District Attorney, Attorney General and Senator.  That is meritorious and as a consequence she is imminently qualified.

The last couple of weeks have certainly brightened my political mood.  Biden's exit from the Democratic ticket has sent a disturbance through The Force.  I bought a case of microwave popcorn from the Boy Scouts and have laid-in a stash of Merlot.  Looks like it's gonna be game-on....

A Force For Good

The North Atlantic Treaty Organization, or NATO, was created in 1949 by 12 countries to provide collective security against the Soviet Union.  

To this day NATO's stated purpose is to guarantee the freedom and security of its members through political and military deterrence.

Following Russia's unprovoked invasion of Ukraine previously non-aligned and neutral Finland and Sweden requested, hand-in-hand, membership in the alliance.  As a consequence, NATO has expanded and strengthened as a direct consequence of Putin's aggression.  

At the present time NATO has 32 member countries.  These countries, called NATO Allies, are sovereign states that come together through NATO to discuss political and security issues and make collective decisions by consensus

Article 5, which stands at the heart of NATO's founding says that an attack on any member of the alliance would be viewed as an attack on all.  If such an attack does occur, each member will take measures necessary to restore and maintain international peace and security.  Article 5 has been invoked only once; following the terrorist attacks of September 11, 2001.  NATO came to America's aid.

It's good to have friends.

NATO's recent expansion does not inherently threaten world peace or risk nuclear war.  It is a defensive alliance  focused on deterring aggression and protecting member states.   Any new memberships are driven by the voluntary decisions of sovereign nations seeking security.  Ukraine is not a NATO member; a potential for future membership would naturally be conditioned  on meeting specific criteria and the consensus of existing allies.  NATO has always emphasized responsible management of geopolitical dynamics and conflict prevention.

Contrast that with Russia's annexation of Crimea and expansionist designs over countries that it has historically considered part of the Russian sphere of influence.  To be clear, the alliance's doctrine aligns with the core belief that nuclear war can never be won and must never be fought; prioritizing deterrence in order to prevent conflicts.

NATO has successfully integrated Eastern European nations without triggering a major conflict demonstrating a capacity for responsible enlargement of the pact members.  NATO support for Ukraine is primarily defensive, aiming to enhance Ukraine's sovereignty.

NATO is not a monolithic organization and its membership doesn't always agree.  Such is the nature of a diverse membership of democracies, nonaligned nations and tolerance for differing points of view.  

On balance I believe that NATO has been good for Europe and good for Canada and the U.S.  It has been good for our economies and good for our defense forces.  It has been good for the world.

There is a minority that will take issue with my view; nevertheless, in a world with dangerously bad actors, in my opinion for 75 years NATO has been a force for good and it's better to be aligned with the good guys instead of the bad guys.

There will be a presidential election in November, the outcome of which portends the role of the US in the alliance and the security of democracies that form this alliance.  In case you missed it there is an unholy alliance of Russia, China and North Korea and Iran. 

NATO is a vital counterweight to the destabilizing influences of these unstable dictatorships.  It is as relevant to our security as the venerable (almost as old) B-52 bomber.  A deterrence and a force for good.

How To Win Friends And Influence People

In further news, this past weekend Donald Trump gave voice to his planned Retribution Tour after he retakes the White House.

Trump has vowed to prosecute and punish his political opponents; promising the arrest and imprisonment of President Biden (and his family), Vice President  Kamala Harris, former Vice President Mike Pence, Senators Chuck Schumer, Mitch McConnell, former Speaker Nancy Pelosi, former Congressman Adam Kinzinger, Representatives Adam Schiff, Jamie Raskin, Pete Aguilar, Zoe Lofgren and Bennie Thompson, retired Joint Chiefs Chairman Mark Milley, an extensive list of judges, district attorneys, state election figures, local and federal law enforcement officials, National Archives employees, charity and religious organizations who aid migrants, journalists and media organizations and Mark Zuckerberg. 

Former Wyoming congresswoman Liz Cheney was singled-out for particular scorn and undeserving of due due process.  Elizabeth Lynne Cheney is guilty of treason, and Trump called for her to be prosecuted by a televised military tribunal reserved for enemy combatants and war criminals.

I know I've missed quite a few individuals and organizations who have made the enemies list which is growing by the day.  

The base loves this Roman Colosseum "feed them to the lions" stuff. Yet I'm still trying to figure-out how this makes for a successful reelection campaign strategy.  Big Fat Middle; remember?  

And suppose someone else runs on the Democratic ticket?

We're certainly living in interesting times.....

A Six-Pack of Republicans

This is from an article published in August of last year; so it's dated.  Feel free to ignore any reference to the trials and tribulations of the Ron DeSantis campaign for the GOP nomination for president.  

Nonetheless, on the heels of almost nine years of fealty and obeisance to Donald Trump, only a few would argue that the party is still defined by Ronald Reagan’s famous three-legged stool of the religious right, fiscal conservatives and neoconservative hawks.

But if the Republican Party is no longer in Reagan’s image, it’s not necessarily a populist-conservative MAGA monolith, either.

Last July's New York Times/Siena College poll found that only 37 percent of Republicans count as part of Mr. Trump’s loyal base.

And while majorities of Republicans side with Mr. Trump on almost every issue, those majorities are often quite slim: Around 40 percent of Republican-leaning voters support aid to Ukraine, support comprehensive immigration reform or say abortion should be mostly or always legal.

But if the Republican Party isn’t quite a MAGA monolith, what is it?  To better understand the party today, the Times split Republican and Republican-leaning voters into groups, based on the results of the Times/Siena Poll.  The groups were defined by how Republican-leaning voters felt on the issues — not how they felt about Mr. Trump.

The results depict a Republican coalition that consists of six groups:

The Moderate Establishment (14%). Highly educated, affluent, socially moderate or even liberal and often outright Never Trump.

The Traditional Conservatives (26%). Old-fashioned economic and social conservatives who oppose abortion and prefer corporate tax cuts to new tariffs. They don’t love Mr. Trump, but they do support him.

The Right Wing (26%). They watch Fox News and Newsmax. They’re “very conservative.” They’re disproportionately evangelical. They believe America is on the brink of catastrophe. And they love Mr. Trump more than any other group.

The Blue Collar Populists (12%). They’re mostly Northern, socially moderate, economic populists who hold deeply conservative views on race and immigration. Not only do they back Mr. Trump, but he himself probably counted as one a decade ago.

The Libertarian Conservatives (14%). These disproportionately Western and Midwestern conservatives value small government. They’re relatively socially moderate and isolationist, and they’re on the lower end of Trump support compared with other groups.

The Newcomers (8%). They don’t look like Republicans. They’re young, diverse and moderate. But these disaffected voters like Democrats and the “woke” left even less.

Mr. Trump’s dominance of the Republican Party is founded on an alliance between the Right Wing and Blue Collar Populists, two groups that combine to represent nearly 40 percent of Republicans — and about two-thirds of Mr. Trump’s MAGA base of seemingly unshakable support. 

The bottom line is that (in case anyone cares any more) the growing numbers of center-right voters, Reagan Republicans and independents still retain some clout in a general election.  The Big Fat Middle.  I'll be watching to see if the same polling is published in a couple of months.

Complete article here.  It's an academic read if you're not blocked by a pay wall.  Stay-tuned.....

The Big Wager

In the world of wagering you can place a bet on virtually anything.  It doesn't have to be on the outcome of a ball game or a horse race.  People place bets on all sorts of subject matter; both common and arcane.

Starting a small business is a bet.  Investing in stocks may sound like a bet or walk like a bet; nevertheless, it requires an ownership interest.  

In the financial markets, spread betting is a form or derivative trading on various types of securities.  Traders (gamblers) speculate on how the price of a financial asset will move and make a profit or loss based-upon the outcome.  Unlike investing in stocks, they do not own or take a position in the underlying asset. 

Not all bookmakers take bets on anything and often you cannot find the bet you want to make available.  Nevertheless, you can wager on the possible outcome of anything from an emerging COVID variant, the Academy Awards, gasoline prices, flight delays and natural disasters.  Naturally distrustful of polling data, for a long time I have followed the Vegas line on election outcomes.  More information builds a basis for rational predictions.  Not that I am any better at it.

Speaking of which, PredictIt specializes in elections.  A contract for President Biden winning in November recently cost 51 cents versus 47 cents for former President Trump.  Both contracts pay $1 if you're correct. 

Alas, the Commodities Futures Trading Commission (CFTC) has been grabbing the bull by the balls with prediction market operators over both the merits and legality of wagering on domestic elections.  

In 2023 the CFTC rejected a bid by derivatives start-up Kalshi as a consequence of perceptions of violations of election law.   The CFTC has taken both Kalshi and PredictIt to court.

Much of this is an academic pursuit.  Common sense suggests to me that derivatives contracts are used all day long to help (and protect) businesses and individuals from the consequences of unexpected and disastrous outcomes.  If I had significant exposure to electric vehicle stocks I might hold a contract protecting me from a Trump election win in November.  Elections have consequences after-all.  And depending upon where you stand both good and bad.  But I digress.

The bottom line is the Vegas line on election outcomes,  I happen to think the odds-makers play an important role with the use of an additional tool to measure where voters might stand on a particular candidate. 

Does a financial services regulator have a role in elections?  Is this the purview of Congress and lawmaking?  I dunno.

Stay-tuned....

The Undecided

At this particular moment in time and place the candidates of the two major parties are Joe Biden and Donald Trump - a rematch that is universally despised.  Thinking about this recently i wondered if there is anybody left that hasn't already made-up their mind.  As divided along partisan lines as this nation has become are there any undecided voters left standing?  And if so, where might we find them?

Citizen Trump is staring-down something on the order of 90 felony counts in four criminal cases.  A trial begins at the end of this month - March 25.  Never in our nation's history has a former president faced even one criminal indictment.  While unlikely to impact diehard MAGA support; might a felony conviction result in the loss of some otherwise reliable GOP votes? 

There's also that thing called the Big Fat Middle; non-affiliated, independent, traditional conservative and right-leaning independent voters.  This group is growing by the day.  How big will it be come November?

And don't forget the disaffected outcasts wandering in the wilderness.  MAGA world will tell you they are not REAL Americans.  They are RINOs.  They may be marginalized pariahs, but they haven't allowed their political allegiances to take-on a messianic identity.  Their playbook doesn't include sowing divisions among family or breaking friendships.  If they hold spiritual beliefs, they are just that; they don't worship mortals.  Might they decide a close election?

Finally, there is that population that dislikes both major-party candidates. They are the Double Haters.  As a consequence of Clinton fatigue they leaned towards Trump in 2016.  Fatigued by four years of Trump drama, they leaned towards Biden in 2020.  Ask yourself, has the drama stopped?  Or has it grown over the past four years?  In 2024 who are the haters going to hold their nose and vote for?

What if one or both of the presumptive candidates withdraw?  Which may be a reason for Nikki Haley hanging-in the GOP primary when she hasn't otherwise got a clear path to a nomination.  Perhaps she thinks something untoward might happen to Trump?  Or maybe she just wants to say I told you so if Trump loses to a Democrat.  It's a long road to election day...

Election Economics

It should come as no surprise that for many individuals and households their standard of living improved during the time Donald Trump was in the White House.  That's not to say that things ended badly with the COVID pandemic and recession at the close of his term of office; people tend to remember the positive and discount the negative.

It is textbook economics that massive stimulus spending and supply chain disruptions during both the Trump and Biden administrations are the causal contributors to the recent spike in inflation.   The impact of inflation materialized during Biden's occupation of the White House.  Consequently, many individuals associate inflation as something Biden is solely responsible-for.  Surprised?  Voters aren't economists. Economics is complicated stuff for anybody who drinks from the Face Book cesspool of lazy economic thought.  Excess liquidity and stimulus largess was the primary cause and interventionist action by the federal reserve is the prescribed cure.  Sure, I get the politics of gaslighting the inflation issue.  But I digress.

Under Biden many individuals and families have struggled with inflation.  And while conditions have improved this may not be enough for some voters.  For Biden that is a burdensome problem.

Trump has any manner of personal flaws, admires bad guys like Vladimir Putin, tried to steal an election, fomented a riot and continues to deny his 2020 election loss.  For Trump that is a burdensome problem.

For both Trump and Biden their administrations enjoyed the benefit of economic success and the challenges of economic headwinds.  Nothing new under the sun there.

There are voters that loathe Donald Trump and there are voters who loathe Joe Biden.  Voters frequently judge their presidents based upon their personal economic gains or losses coincident with a given administration.  Confirmation bias too.  Because I go out of my way to not allow politics to infect financial decisions I've prospered during the reign of both of these presidents.  Actually every president for as long as it mattered.

As a recovering financial guy it's easy for me to view the current economic condition with a rational eye.  What I see is an American economy that grew at a healthy clip in 2023.  Unemployment remained low, inflation continued to drop, job growth is holding steady, real wages (adjusted for inflation) exceed pre-COVID levels.  And exceeding forecasts, GDP growth climbed by 3.3 percent in the last quarter.  Speaking of forecasts, a year ago expectations were for a recession.  Today it is expected that while growth may slow in 2024; in the absence of an unexpected outside event (read: wider middle east war), no major downturn.  Consumer sentiment should continue to rebound.

If you want to throw your support to Biden because you believe you'll prosper knock yourself out.  If you're a Trump backer because you're convinced the current economy is a hell hole; hey, knock yourself out.  Know this:  election outcomes are more frequently determined by rational individuals found in the middle.  Namely independent and disaffected voters.

Just last month, polling by Gallup highlighted that more voters now identify as independent - forty-three percent - tying the previous high not seen since 2014.  Ponder the implications of this shift in light of the 2024 election.

The impact of a single president over something as huge and complicated as our economy is frequently overstated.

A platform of grievance and retribution doesn't cut it for me.

That's my nuance.

P.S. - At the time this is published the markets have also set record highs. Nevertheless, I acquired shares of BA at a significant discount recently.  An assembly mistake is not the same as a design defect.

Independents Day

A Gallup Poll published only a few weeks ago served as evidence that those who identify politically as independents  make up the largest contingent of voters in the country.  A whopping 43%, tying a record previously set in 2014.

The number of individuals who identify as Democrats set a new record low of 27% - coincidentally the same as the number of respondents who identify as Republicans.  

The decline in Democratic identification has been dropping a point for each of the last three years.  The people at Gallup surmise that this decline is a consequence of President Biden's low job approval rating.

The rise in number of those identifying as independents can be traced to 1991.  Having previously been the largest political group this rise has largely been at the expense of Democrats.  

This trend has given Republicans a small bump as Gallup learned from survey respondents that when asked, independents in 2023 indicated they were slightly more likely to lean Republican.

When asked to describe their views on a spectrum ranging from liberal to conservative - last year 25% described their political views as liberal, 36% as moderate and 36% as conservative.  These findings have largely remained unchanged for a decade.   

Taking a longer view, those who describe their views as conservative and moderate have shrunk over the last two decades; while those with self-described liberal views have risen from a low of 20% over the same time period.  

You're probably scratching your head and wondering if this has any impact on how things will play-out in the 2024 primaries and general election.  I know I'm curious.  However, not being a pollster I suppose I'm going to have to wait and see.  Exiled from the GOP to wander in the desert with my brethren it likely has to have some implications; exactly how this will manifest is not known.  Again, the Gallup folks suggest that this might not be a positive for Democrats and that independents who lean Republican may give the GOP a slight edge.  Personally, I think (wild-ass guess) Donald Trump is going to be the X Factor.  The ultimate trump card (pun intended).

You can perform a deep dive into the data over here at Gallup.  Meanwhile, I'm certainly not feeling any love from anybody.  Funny that.

Last Stand Hill

Years ago Jill and I spent a couple of days camping in the vicinity and touring the Little Bighorn Battlefield National Monument.  It is a sprawling battlefield best navigated by automobile to capture the scale of the do or die conflict.  

Nikki Haley has finally gotten what she wanted since the start to her campaign for the GOP presidential nomination:  a vast battlefield in New Hampshire and a one-on-one showdown with Donald Trump.  Do or die.

Sunday the field was cleared for her with Florida Governor Ron DeSantis suspending his campaign.  The former governor of South Carolina and UN Ambassador, Haley is left as the only real threat to a third consecutive Trump nomination.

Polling suggests Trump retains a commanding lead, but Haley has dismissed the idea the race was over, suggesting America doesn't do coronations.  We believe in choices.

We'll see if this is the hill she's chosen to die on.  Stay-tuned...