Time To Start Discounting A Hard Left Turn

 “I don’t like the Democrats, but Trump is destroying the Republic!  – Retired Four-Star General (See Admiral McRaven’s editoral below) 

Last week was a very bad week for President Trump and may, in hindsight, be the tipping point of his presidency and the Republican Party.   We list and explain the five political bombshells that exploded, which we believe will work its way through the American political system and eventually adversely impact the risk markets.

Senate Republicans will soon have to choose between Mr. Trump or the rule of law.  Public opinion is quickly moving toward the later, where a majority of the country now supports the impeachment and removal of President Trump.

Along with most of the country, we really admirer  the Warrior Monk, especially after reading this story,

…Mattis has a compassionate side to him. The story goes that Mattis stood duty on Christmas back when he was a brigadier general so that a younger Marine could spend the holiday with his family.

…retired Marine Gen. Charles Krulak, who was commandant when the story took place. Every Christmas during his tenure, Krulak delivered cookies to every Marine duty post around Washington and Quantico, Va.

Back in 1998, he was making his final delivery to Marine Corps Combat Development Command headquarters at Quantico when he asked the Marine on duty who the officer of the day was.

“The young Marine said, ‘Sir, it’s Brigadier General Mattis.’”

Krulak thought the Marine had misunderstood him, so he asked again, but he got the same answer.

“I looked around the duty hut and in the back, there were two cots: One for the officer of the day and one for young Marine. I said, ‘OK, let me cut through all of this: Who was the officer who slept in that bed last night?’

“And the Marine said, ‘Sir, Brigadier General Mattis.’”

At that moment, Mattis walked around the corner.

“So I said to him, ‘Jim, what are you standing the duty for?’ “And he said, ‘Sir, I looked at the duty roster for today and there was a young major who had it who is married and had a family; and so I’m a bachelor, I thought why should the major miss out on the fun of having Christmas with his family, and so I took the duty for him.’ ”  — Stars & Stripes

What a good man and an incredible warrior.

The Other Four Star

Go no further for more evidence the President is losing the confidence of the top military brass, at least, publicly, by retired admirals and generals, than Admiral McCraven’s Op/Ed in the NY Times.  McRaven, a Navy Seal, was charged with the raid that captured Osama Bin Laden.  I just finished his book, Sea Stories: My Life in Special Operations, where he devotes a fascinating and gripping chapter to Operation Neptune Spear.

Here are the money quotes from his NY Times piece,

4. Trump and Pence Rolled By Erdogan Like A Cheap Cigar

Donald Trump got “rolled” by Turkish President Recep Tayyip Erdogan, a National Security Council source with direct knowledge of the discussions told Newsweek.

In a scheduled phone call on Sunday afternoon between President Trump and President Erdogan, Trump said he would withdraw U.S. forces from northern Syria. The phone call was scheduled after Turkey announced it was planning to invade Syria, and hours after Erdogan reinforced his army units at the Syrian-Turkish border and issued his strongest threat to launch a military incursion, according to the National Security Council official to whom Newsweek spoke on condition of anonymity

…”President Trump was definitely out-negotiated and only endorsed the troop withdraw to make it look like we are getting something—but we are not getting something,” the National Security Council source told Newsweek. “The U.S. national security has entered a state of increased danger for decades to come because the president has no spine and that’s the bottom line.”  – Newsweek

We are all for bringing our troops home and ending the forever wars.  But these troops are not coming home and they were tantamount to the Dutch boy with his finger in the dike holding back the dam from breaking.   The dam has now broken and we will witness the consequences of the disastrous flood unfold during the presidential campaign.  Not Republican positive, in our opinion.

America Throws The Kurds Under The Bus, Again 

The poor Kurds.  I do remember how Bush #41 left them hanging out to dry after the first Gulf War for Sadaam to slaugter.

Nothing in this world is certain except death, taxes, and America betraying the Kurds.

The U.S. has now betrayed the Kurds a minimum of eight times over the past 100 years. The reasons for this are straightforward.

The Kurds are an ethnic group of about 40 million people centered at the intersection of Turkey, Syria, Iran, and Iraq. Many naturally want their own state. The four countries in which they live naturally do not want that to happen.  — The Intercept

Upshot

The world seems Fubared with little hope but we can’t stop fighting, folks.   Republican, Democrat, or Independent.

Should stocks be making new all-time highs?   We don’t think so, but they seem to want to, for now.

We believe the market is in a long topping process, are at historically high valuations, and on the eve of an ugly bear market.   Not much upside, lots of downside, and we just laid out another potential catalyst.

We don’t know the future and nobody else does.  We also, as always, recognize we could be wrong but not because we haven’t done our homework.

Stay frosty, folks.

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Source: https://global-macro-monitor.com/2019/10/21/time-to-start-discounting-a-hard-left-turn/