Is America on the eve of destruction?

By David Stockman  |  July 18, 2019

This feels like an inflection point here in America.

Maybe it’s simply the fact that the major indexes are showing the same signs of exhaustion we’ve seen when they’ve reached similar heights over the past 18 months. Perhaps it’s that the Conference Board’s Leading Economic Index posted its biggest decline in three years in June.

Is This The End?

It’s almost Sisyphean, this late-in-an-old-and-weak-recovery rally.

Maybe this is the one to end it all. The Everything Bubble, monetary central planning, maybe the Welfare State, perhaps the whole empire of America too…

The Great Disruptor is certainly doing his bit. His rally in Greenville, North Carolina, was just a trail run of a divide-and-conquer electoral gambit. It’s only going to get worse.

MAGA marches back to the Old North State for the Republican National Convention next summer in Charlotte. Maybe by then he may have taken us to a point from which there is no safe, small-“d” democratic return.

So, markets are churning for a fourth day this week, here at the very beginning of another earnings-reporting season.

Does any of it matter, though? Oh, a big miss here and an upside surprise there will, for sure, create short-term trading opportunities. But the big picture right now is pretty binary.

We Have The Powell Put And The Donald

The first is dangerous enough. But at least we know, generally, what happens when bubbles burst on Wall Street in the 21st century. Corporate America will announce mass layoffs. And Main Street will suffer.

When it comes to the Tweeter-in-Chief, well, in addition to his social media hordes, he also commands our trillion-dollar-a-year Warfare State.

He is tone-deaf and offensive. He is profoundly anti-conservative in the traditional, small-government-pro-liberty-honest-free-market sense of the term.

But it goes far beyond emphasis and misplaced symbolism. As the great Randolph Bourne famously proclaimed among the insane carnage of the First World War, “War is the health of the state.”

That trillion-dollar military-industrial-surveillance complex spending represents a raw and wholly unnecessary glorification of  America and its far-flung machinery of empire.

It’s an illicit undertaking with no basis in our traditions of liberty and the concept of a peaceful republic. Which led the signers of the Declaration of Independence to expose themselves to the terminal justice of King George III’s hangman.

Untrue Things 

The Warfare State is now so massive and deeply embedded in the warp and woof of national governance that it writes its own ticket. It’s a self-licking ice cream cone.

It declares things that are untrue. And then it uses those untrue things to justify its budgets, its missions, and its monumental capacity for lethal action. And that’s for anywhere in the world, anytime of the day or night.

Recent “untrue things” include the claim that Russia annexed Crimea against the will of its people. There’s also the assertion that China is lacing Huawei cell phones and network gear with secret spy equipment.

There looms too the idea that we must risk war with Iran over its nuclear ambitions. And John Bolton has set the table perfectly to get what he wants from the president.

We’ve been doing business this way for more than 70 years. It goes back all the back to the 38th parallel on the Korean Peninsula, through the “Domino Theory” and Vietnam. All the way up to and including the idea that Saddam Hussein had to be taken out because he was harboring weapons of mass destruction and al-Qaeda operatives.

And we’ve handed that legacy to a former game-show host whose life philosophy consists of bile, bombast, braggadocio, and bullshit.

Godspeed, America…

Join or Die

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…



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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