Washington DC

National Lampoon’s Oval Office

By David Stockman  |  May 29, 2019

Otter: Bluto’s right… psychotic, but absolutely right… I think that this situation absolutely requires a really futile and stupid gesture be done on somebody’s part…

Bluto: We’re just the guys to do it.

– “National Lampoon’s Animal House” (1978)

When Trade War deployments attack German luxury sedans and Canadian flat-rolled steel, you have a government capable of unlimited harm.

You also have even more reason to focus on a fragile expansion that’s just about officially the weakest and longest in U.S. history.

I was born in 1946. I have less and less against mere old age with each passing year. But old age does bring ailments and fragilities. And that means greater vulnerability to shocks the young take in stride.

That’s doubly true if you’ve slouched toward the dissolute side of healthy diets and exercise habits. Sadly, this is exactly what describes this soon-to-be-120-months-old “recovery.”

Nothing that clogged the system and caused the last so-called heart attack in September 2008 has been fixed. Indeed, all the bad habits have only gotten worse. Since what should have been a moment of clarity, we’ve only binged on more debt, more imports, more government spending, and more speculation.

Main Street is hollowed out. Corporate America is financialized. And Wall Street is vulnerable to the biggest crash anybody’s ever seen.

David Stockman’s Chilling Prediction…

The Father of Reaganomics has returned with a dire warning:

“Trump may be the Great Disruptor, but he’s going to fail at one of his core campaign promises. And his failure could cost you your freedoms AND your wealth.”

To learn more about Stockman’s prophecy and to find out what you can do to protect yourself, your family, and your assets, just go here.

Any sign of weakness or faltering at this late stage is especially significant. And the U.S. economy simply has precious little capacity to absorb any shock.

So, the Donald’s escalating Trade War more than qualifies. This one’s intolerable for a reason none of Bubblevision’s talking heads – nor even any of Imperial Washington’s newly ascendant Sinophobes – grasp.

It’s not a paint-by-the-numbers thing. The usual “not too worry” won’t do. And that’s notwithstanding the fact that even the Donald’s full 25% tariff on all $563 billion of Chinese goods amounts to only 0.68% of gross domestic product (GDP).

Nor is it a case of what nitwit alt-right China basher Steve Bannon spewed on CNBC in mid-May, that America holds the overwhelming advantage in the current contest with Beijing.

Trump’s former chief strategist actually called for regime change in the Middle Kingdom.

In fact – unbeknownst to America’s 100 million Walmart-shopping households – we’ve have been “at war” with China for two decades already. Indeed, now’s the time for a do-or-die last stand…

“China has been running an economic war against the industrial democracies for 20 years,” Bannon said, noting that previous presidents – Clinton, Bush, Obama – all “blinked” when it came time to face this fact.

In the world according to Bannon, “Trump didn’t blink.”

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The standoff with China “cuts to the core of what the United States is going to be in the future,” Bannon said in a Squawk Box interview.  “We have all the cards.”

The truth is, it’s way too late in the globalization game to “learn to live” with big tariffs, as some on Bubblevision are starting to babble about. And Imperial Washington has almost no “cards” that matter.

Pay no mind to pompous expostulations of semi-educated demagogues.

The fact is, the debt-besotted, hollowed-out, bubble-ridden U.S. economy has been joined at the hip with the tottering Red Ponzi for three decades.

Consider the fiendishly complex supply chains. Look at the intricate financial plumbing networks.

It’s all given rise to the appearance of fabulous prosperity in China, undreamed of wealth on Wall Street and in Silicon Valley, and perpetual power in Imperial Washington.

But the foundation is riddled with fractures. That’s 30 years of bad money from the Federal Reserve and the People’s Bank of China, and their fellow monetary central planners around the world.

And, should the Donald and China’s hawks get what they seem to want, we might find out what “meltdown” really means.

All Is Not Well

Desperate times call for… “common sense” measures.

And these are desperate times… Markets are corrupted by monetary central planning. They’re confused. And the road back is going to be treacherous.

We’re looking at a major re-pricing for all financial assets. And thousand-point intraday or day-to-day swings are part of that equation. Those can be frightening… for “buy and hold” investors.

I have a different approach, one that combines strategy and tactics into a plan flexible enough for you to survive and thrive amid the coming chaos. It’s called “The Stockman Model.”

All we’re after is a little stability, perhaps a chance to pocket a windfall when opportunity presents…

To common sense,

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David Stockman

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David Stockman

David Stockman is the ultimate Washington insider turned iconoclast. He began his career in Washington as a young man and quickly rose through the ranks of the Republican Party to become the Director of the Office of Management and Budget under President Ronald Reagan. After leaving the White House, Stockman had a 20-year career on Wall Street.MORE FROM AUTHOR