Welcome to Tesla Motors Club
Discuss Tesla's Model S, Model 3, Model X, Model Y, Cybertruck, Roadster and More.
Register

Tesla Investor's General Macroeconomic / Market Discussion

This site may earn commission on affiliate links.
So I've been hearing about this all weekend. IMHO, this is not a bad thing. He is willing to listen and change his stance. So Elon, keep talking to Trump, and ignore the critics.

Also, you ought to invite Trump to visit Fremont or the Gigafactory (less traffic congestion) and then to a private luncheon or dinner where Elizabeth Warren and the Donald are introduced for the first time. That would be a good time to begin the process of thawing Democratic base bias and make collaboration with the Dems in Congress possible, especially on infrastructure. While I'm dreaming here, Ivanka should press hard on the idea infrastructure includes at base investment in education and retraining as a lifelong goal--especially for coal miners. **Sugar** the mine owners whose heads are where the sun don't shine, to coin a phrase. They should learn from the Donald that failure is an opportunity, at least for tax breaks. (Investment tax breaks anyone?)
 
Just for balance lest we fall into the honeypot of dependence on Ivanka as a humanizing influence on the Donald, the former speechwriter for Bush II, David Frum, has a darker view:

Trump’s Plan to End Europe

In contrast to many macro posts this has more relevance to investors because it implies overturning the trading patterns of the post war world. Frum was even more critical on the latest Charlie Rose show.

Politics - Charlie Rose

As with others I am becoming increasingly alarmed about Trump's incompetency, especially in not filling important sub-cabinet posts or letting Cabinet members select their own choices. Trump does not have that many competent friends or family. The general administration of US government will fall apart and his credibility with foreign leaders, often falsely identified as good, will be matched by even more skepticism by the US public. In a sense the total collapse of confidence in government is really guaranteed by Trump's campaign and victory last November. Draining the swamp of what little talent it has will confirm the belief effective government is dead. Victory powered by incompetence will confirm his campaign's false prophecy of American weakness.

What happens when the saviors do not save but turn out to be not just tinsel but real tinsel? Alas, what is said of Hollywood is even more true about television and its stars. What happens when we no longer have confidence in the con? It really is hard to get an aircraft carrier to turn around!
 
Last edited:
  • Like
  • Love
Reactions: MitchJi and neroden
Just for balance lest we fall into the honeypot of dependence on Ivanka as a humanizing influence on the Donald, the former speechwriter for Bush II, David Frum, has a darker view:
Trump’s Plan to End Europe

I appreciate you posting this article as an alternate view, Professor........but wow was it a struggle to force myself to read it to the finish line. As you know, I am not a defender of Trump, but I do try to avoid letting history be rewritten and point out efforts to do so when I think I see them. And I find David Frum making a clear attempt to do so. Is it not a little too convenient that a previous speech writer for Shrub (I prefer Molly Ivans to Frum) is penning an article blaming Trump for the crumbling of the EU in his very first months of office? The author did rightfully mention the similar policies of his boss and other administrations towards Europe, and we have discussed the similar military policies of GW and Obama as outlined by General Wesley Clark. To avoid such re-writes of history however, we must maintain an awareness when reading articles such as this that prior to the US presidential elections:
  • Brexit happened (5 months prior to Trump's election)
  • Greece was being financially supported with debt it could never pay to avoid a domino effect of the Central Bank
  • Portugal and Spain were on the fence and about to follow Greece
  • Significant Nationalist Party momentum had already surged in France and Italy, with some predicting they would follow Brexit
  • Similarities of nationaist movements in the EU and the US were being pointed out by people that were predicting a Trump victory as a result
  • And this trail of very visible clues (except in the news reported in the US) leading to a growing belief that even Ms Merkel may not get re-elected for similar reasons
Again, all happening prior to Trump implementing any of the new management practices from the Oval Office that Frum writes about. I do believe that if we look closer at the similarities of the EU and the US that we can better understand how Trump happened here as a similar failure of our systems/policies as Brexit happened in the EU. But to do so we must admit that the larger picture was crumbling well in advance of Trump. That isn't likely something a neocon former speech writer of GW wants to talk about. The very fact that these issues are not being discussed openly here in the US troubles me. I certainly don't claim to have a finger on the pulse for the real reasons the EU has been slowly crumbling in recent months/years, and I have found it a difficult topic in the US to research because of articles like Frum's that put a spin on it. I have however followed it fairly closely because it does have relevance to our investments as you mentioned, and because I was fascinated to see that the people who were correct in their predictions of a Brexit victory were also correct in their predictions of Trump victory - based solely on the similar economic policy issues of the US and the EU (thus my questions to you regarding Germany's NATO role/history).

Beyond the policies of austerity common to the US and Germany that we have already discussed, these EU 'failures' have most notably been tied to the fact that the Central Bank is located in Germany, and only Germany is allowed to print money for the EU. The ability to create new debt to stimulate the economy has worked well for the US.............and it has worked well for us as investors of Tesla. Had the previous administration not provided stimulus funding (debt) to Musk and Co. we would likely not be here discussing our successful portfolios (for some a portfolio of 1 stock). And because the US prints the US Dollar, which is the standard for world currency, it is advantageous for other countries to want to buy our debt and invest in our stock market - which provides much of the stability of the US stock market. But what happens when France or Italy wants to stimulate their economies? Will they be the owners of the new Junker Bonds or the US Stimulus Plan debt? No, they will not. To create large infrastructure and technical improvements such as building Eisenhower Interstates, or funding Kennedy Space Missions, or even creating electric car companies under the Obama Administration, they would need to borrow money from the EU's Central Bank in Germany, and pay interest to Germany bankers. How is that working for Greece, Spain, and Portugal? Perhaps it is because of this twist that the countries that have avoided deeper troubles in the EU - such as Denmark - have policies that are a little more socialistic by necessity............i.e. because they don't own the money printing press they can't afford to have a playing field that isn't a little more flat.
I would like to see Mr. Frum explore these ideas with more depth before pointing the finger at the new president in his first months - a president I don't agree with, but a president that may have simply been elected as a result of the failures of previous administration's financial policies - which included Mr Frum's previous boss.
 
Theresa May has just called a snap general election to be held on 8th June. This will most certainly result in an even stronger mandate for the current Conservative government, but may cause jitters and uncertainty for a while in Europe.

Well, it *might* result in a huge mandate for Theresa May (which would at least put her in a more legitimate position).... or it might toss out the government. Apparently UK opinion polling is highly unreliable. If you're in the UK and have a view of any sort, get out and campaign!
The U.K. Snap Election Is Riskier Than It Seems
 
Just for balance lest we fall into the honeypot of dependence on Ivanka as a humanizing influence on the Donald,
Well, when you have a highly erratic person who listens to crazy conspiracy theories as King, you are happy for small mercies such as having *some* sane family member who he listens to. I don't think she's going to make him do anything good per se -- I just think she's going to do her best to prevent him from creating stupid catastrophes. She likes stability and a quiet life.

In contrast to many macro posts this has more relevance to investors because it implies overturning the trading patterns of the post war world.
Yeah, the change in the trading patterns was coming even before Trump. Look up the discussion of what some call the "globalization cycle". The last globalization period was the 1880s-1910s and was destroyed in the flames of World War I, replaced by a much more closed regime which lasted for most of the 20th century. I really hope we can find a softer landing than WWI this time. We're already seeing deglobalization as it becomes more difficult to have foreign bank accounts or foreign vacation homes or foreign vacations. Capital controls are being implemented with great success by a number of countries. We're well into a major change in trading patterns.

Also, this is the "Chinese Century", and trading patterns are already changing to accomodate that.

As with others I am becoming increasingly alarmed about Trump's incompetency, especially in not filling important sub-cabinet posts or letting Cabinet members select their own choices. Trump does not have that many competent friends or family.
Indeed. I count a total of one.

This is really not a good situation, certainly. It's not like Warren G Harding's cabinet was competent either, though.... luckily there were no significant problems which needed to be dealt with at the time...
 
Totally off topic. I just received this forwarded by my sister in law, the librarian. (I have removed the name of the airline to protect the innocent, ourselves.) Here are the suggested new slogans.

We have First Class, Business Class, and No Class.
Our prices can’t be beaten...but our passengers can.
We put the hospital in hospitality.
We beat our passengers, not the competition.
We have an offer you can’t refuse. No, really.
Bored as a doctor, leave as a patient.
Not enough seating? Prepare for a beating.
And you thought legroom was an issue.
.If our staff need a seat, we’ll drag you out by your feet.
We treat you like we treat your luggage.
Fight or flight.
You may have patients, but we don’t have patience.
We have red-eye and black-eye flights available.
Now serving free punch.​
 
and another enemy-- why the hell not

Trump blasts Canada on trade, calls its actions a 'disgrace'

"
President Donald Trump
President Donald Trump on Thursday criticized Canada for its trade policies, singling out multiple industries in that country and saying among other things that "what they have done to our dairy farmer workers is a disgrace."

Trump frequently singles out individual countries, including close allies, with claims that they're taking unfair advantage of the United States. He typically does so without citing evidence.

"We're not going to let Canada take advantage [of the U.S.]," Trump told the group of reporters, vowing to get to the "negotiating table" swiftly.

Trump said that Canada was hurting U.S. timber and lumber jobs as well.
"
 
  • Informative
Reactions: neroden
I appreciate you posting this article as an alternate view, Professor........but wow was it a struggle to force myself to read it to the finish line. As you know, I am not a defender of Trump, but I do try to avoid letting history be rewritten and point out efforts to do so when I think I see them. And I find David Frum making a clear attempt to do so. Is it not a little too convenient that a previous speech writer for Shrub (I prefer Molly Ivans to Frum) is penning an article blaming Trump for the crumbling of the EU in his very first months of office? The author did rightfully mention the similar policies of his boss and other administrations towards Europe, and we have discussed the similar military policies of GW and Obama as outlined by General Wesley Clark. To avoid such re-writes of history however, we must maintain an awareness when reading articles such as this that prior to the US presidential elections:
  • Brexit happened (5 months prior to Trump's election)
  • Greece was being financially supported with debt it could never pay to avoid a domino effect of the Central Bank
  • Portugal and Spain were on the fence and about to follow Greece
  • Significant Nationalist Party momentum had already surged in France and Italy, with some predicting they would follow Brexit
  • Similarities of nationaist movements in the EU and the US were being pointed out by people that were predicting a Trump victory as a result
  • And this trail of very visible clues (except in the news reported in the US) leading to a growing belief that even Ms Merkel may not get re-elected for similar reasons
Again, all happening prior to Trump implementing any of the new management practices from the Oval Office that Frum writes about. I do believe that if we look closer at the similarities of the EU and the US that we can better understand how Trump happened here as a similar failure of our systems/policies as Brexit happened in the EU. But to do so we must admit that the larger picture was crumbling well in advance of Trump. That isn't likely something a neocon former speech writer of GW wants to talk about. The very fact that these issues are not being discussed openly here in the US troubles me. I certainly don't claim to have a finger on the pulse for the real reasons the EU has been slowly crumbling in recent months/years, and I have found it a difficult topic in the US to research because of articles like Frum's that put a spin on it. I have however followed it fairly closely because it does have relevance to our investments as you mentioned, and because I was fascinated to see that the people who were correct in their predictions of a Brexit victory were also correct in their predictions of Trump victory - based solely on the similar economic policy issues of the US and the EU (thus my questions to you regarding Germany's NATO role/history).

Beyond the policies of austerity common to the US and Germany that we have already discussed, these EU 'failures' have most notably been tied to the fact that the Central Bank is located in Germany, and only Germany is allowed to print money for the EU. The ability to create new debt to stimulate the economy has worked well for the US.............and it has worked well for us as investors of Tesla. Had the previous administration not provided stimulus funding (debt) to Musk and Co. we would likely not be here discussing our successful portfolios (for some a portfolio of 1 stock). And because the US prints the US Dollar, which is the standard for world currency, it is advantageous for other countries to want to buy our debt and invest in our stock market - which provides much of the stability of the US stock market. But what happens when France or Italy wants to stimulate their economies? Will they be the owners of the new Junker Bonds or the US Stimulus Plan debt? No, they will not. To create large infrastructure and technical improvements such as building Eisenhower Interstates, or funding Kennedy Space Missions, or even creating electric car companies under the Obama Administration, they would need to borrow money from the EU's Central Bank in Germany, and pay interest to Germany bankers. How is that working for Greece, Spain, and Portugal? Perhaps it is because of this twist that the countries that have avoided deeper troubles in the EU - such as Denmark - have policies that are a little more socialistic by necessity............i.e. because they don't own the money printing press they can't afford to have a playing field that isn't a little more flat.
I would like to see Mr. Frum explore these ideas with more depth before pointing the finger at the new president in his first months - a president I don't agree with, but a president that may have simply been elected as a result of the failures of previous administration's financial policies - which included Mr Frum's previous boss.

Today, days later because of your post, I took a quick scan of the article and did not finish it so I could be compounding a mistake. I think Frum is merely stating Trump's wish overturns a long standing part of the "establishment's" position on Europe, not that the president (hurts to even use that term) claims to have created the conditions explaining the current pressures on Europe and ourselves. He is certainly taking advantage of the situation and given he's such a buffoon perhaps believes he created the situation so he could solve it, although IMHO he is only making those conditions worse for all of us.

As is often said on these threads, fire away!
 
  • Like
Reactions: neroden
As much as I have tried to become informed on Glass-Steagall vs Dodd-Frank, I am still unfortunately at odds. Last year I listened to Bernie and Liz Warren give compelling arguments to reinstitute Glass-Steagall from perspectives that I agree with, however I have also spent a lot of time listening to Mark Blyth give compelling reasoning for the economic benefits of Dodd-Frank in recent months. I was moved by the first two, but Blyth has been - and continues to be so very accurate with his political and economic predictions that I feel I must weigh his argument heavily. I am hoping this board can help fill in some of the empty space between the lines for me. Much appreciated!
 
As much as I have tried to become informed on Glass-Steagall vs Dodd-Frank, I am still unfortunately at odds. Last year I listened to Bernie and Liz Warren give compelling arguments to reinstitute Glass-Steagall from perspectives that I agree with, however I have also spent a lot of time listening to Mark Blyth give compelling reasoning for the economic benefits of Dodd-Frank in recent months. I was moved by the first two, but Blyth has been - and continues to be so very accurate with his political and economic predictions that I feel I must weigh his argument heavily. I am hoping this board can help fill in some of the empty space between the lines for me. Much appreciated!

The intent of Dodd-Frank was probably a good one. But like many laws, lobbyists come in and de-fang most of the stronger regulations and what eventually becomes law makes things even worse.

5 Ways Lobbyists Influenced the Dodd-Frank Bill

How Wall Street Defanged Dodd-Frank
 
Quick review before markets close for the weekend-
there's a continuing divergence between 'soft' data and 'hard' data in the economy/markets.
Soft confidence measures (from corporate governance, market investors, and consumers is high). Hard data continues to counter that sentiment (commercials loans lowest in 6 years, flattening yield, consumer spending etc.).
The yield curve spread is deeper into Yellow caution territory- but holding ; another few moves will place it to an increased warning level (but not yet). (Remember this is a long measure of future (6-18 months), not a trading measure.
Earnings so far are pretty good- that's the one piece of hard data holding up the soft data
- but be aware, in general the 2 data sets are diverging to a point one or the other will have to correct.
Here's an example of that in a single chart for illustration

C95bg5pVYAARmUw.jpg


Again it's the trend here that's important - these posts are generally meant to provide toning to long term investors on the type of leverage for holds of many months and years- rather than trades on ERs or even quarterly-
as a reminder- my positions are essentially entirely stock now (even 'trade' layers are stock/cash)- outside of an occasional J19 LEAP, I plan on stock only for the long term due to these macro concerns (this from someone who during the 'recovery' held virtually all LEAPS for leverage)- on the other side of that though- I have nearly tripled my core TSLA stock holding- so it has nothing to do with TSLA- it's macro (fiduciary, political, social) and long term cyclical (recovery and valuations) that instructs the moves.
 
Quick review before markets close for the weekend-
there's a continuing divergence between 'soft' data and 'hard' data in the economy/markets.
Soft confidence measures (from corporate governance, market investors, and consumers is high). Hard data continues to counter that sentiment (commercials loans lowest in 6 years, flattening yield, consumer spending etc.).
The yield curve spread is deeper into Yellow caution territory- but holding ; another few moves will place it to an increased warning level (but not yet). (Remember this is a long measure of future (6-18 months), not a trading measure.
Earnings so far are pretty good- that's the one piece of hard data holding up the soft data
- but be aware, in general the 2 data sets are diverging to a point one or the other will have to correct.
Here's an example of that in a single chart for illustration

View attachment 223828

Again it's the trend here that's important - these posts are generally meant to provide toning to long term investors on the type of leverage for holds of many months and years- rather than trades on ERs or even quarterly-
as a reminder- my positions are essentially entirely stock now (even 'trade' layers are stock/cash)- outside of an occasional J19 LEAP, I plan on stock only for the long term due to these macro concerns (this from someone who during the 'recovery' held virtually all LEAPS for leverage)- on the other side of that though- I have nearly tripled my core TSLA stock holding- so it has nothing to do with TSLA- it's macro (fiduciary, political, social) and long term cyclical (recovery and valuations) that instructs the moves.

Do you have older data points on that chart? IIRC there is usually some spending drop in the early part of the year due to seasonal issues (weather, holidays, etc...).
 
Do you have older data points on that chart? IIRC there is usually some spending drop in the early part of the year due to seasonal issues (weather, holidays, etc...).
Yes it's a very seasonal measure. I'm applying it here because for the first time in over 2 years we've had 2 consecutive down months (note Feb was revised downward). Normally this measure recovers sharply in Feb, this year not so much, and it's contradicted sharply by the consumer confidence levels. That contrast can be indicative of lagging out of phase measures that tend to flag leading indications of precaution of a correction. Couple that with interest rate data and warrants yellow flag

Here is time frame over more than a year so you can see the 'normal' seasonal recovery vs this year.
IMG_0100.PNG
 
  • Informative
Reactions: GoTslaGo