If It’s Not One Thing, It’s Another

If it’s not one thing, it’s another with this administration.

We’ve been saying since the very beginning that although you are of course free to go down with the ship, you should not delude yourself into thinking this ship isn’t sinking.

We’d give you the usual caveat that everyone rolls out when attempting to inoculate themselves against incorrect political predictions (i.e. “we’re no political scientists, but“…) except that it doesn’t apply to us. Because there are some Poli Sci. degrees hanging on the walls over here. And what we’re telling you is that this administration is the political equivalent of the Titanic. It’s doomed. Star-crossed from the word “go.”

The truly amusing part of this whole saga is that it’s no longer clear if Trump will still be President by the time the multiple investigations into his ties to the Kremlin are completed. He may have to be indicted as a civilian.

Just look at Wednesday afternoon. No sooner had he caved to Democrats in order to avert a potentially catastrophic U.S. default than WSJ reported that he’ll now likely skip over Gary Cohn for Fed Chair in retaliation for Cohn’s perceived disloyalty in the aftermath of Charlottesville.

Irrespective of what you think about Gary Cohn, the idea that someone would be eliminated from consideration for a job at the Fed because they suggested the White House should be tougher on Nazis is such an outlandish proposition that it’s difficult to conceive of it.

Trump created a crisis with his bungled response to the violence in Virginia, and now, he’s going to end up creating another mini-crisis by throwing the future of the Fed in question just for the sake of punishing Cohn for reacting the way anyone with any sense would react to the first crisis.

To be sure, there are plenty of capable people that Trump could choose for the Fed job, so we’re not saying it’s the end of the world if Gary is no longer in the running. Rather, the point here is that this is all of Trump’s own making. He himself fueled speculation that Cohn would likely get the job. Then, he himself pissed Gary off. Now, he’s pissed at Gary for being pissed at him.

So you can’t really blame markets for being pissed at Trump, which they apparently are (at least a little bit) as evidenced by the fact that S&P futs have retraced their debt ceiling relief gains:

In the same vein, has anyone seen Rex Tillerson lately? Because generally speaking, the nation’s top diplomat is someone you’d expect to hear from a lot when rogue states are testing nukes and firing ICBMs at Japan (“I launch in your general direction“).

The reason you haven’t heard from Rex is because he’s in the same predicament as Cohn. He’s pissed at Trump and Trump is pissed at him for being pissed. You can read here for the details on that, but it’s starting to look more and more like Nikki Haley is the de facto Secretary of State (which is at least an improvement from the state of affairs that existed earlier this year when Jared Kushner was the shadow head of the State Department).

And no sooner were we thinking of writing this post than someone e-mailed us an article out yesterday in Foreign Policy, excerpts from which read as follows:

President Donald Trump’s administration came out swinging at North Korea after its latest nuclear test. Trump threatened to cut off all trade with any country that traded with Pyongyang; Nikki Haley, the U.S. ambassador to the U.N., accused North Korea of “begging for war”; and Defense Secretary James Mattis appeared to up the ante, warning Kim Jong Un that his country risked “total annihilation.”

But there was one voice noticeably absent from this clamor: America’s top diplomat.

The State Department said Secretary of State Rex Tillerson traveled to Texas over the weekend in the wake of Hurricane Harvey. He called his counterparts in the region and participated remotely in a National Security Council meeting, as State Department spokeswoman Heather Nauert confirmed, but didn’t give any remarks or even put out a statement on North Korea testing a nuclear weapon.

Instead, it was Haley, Trump’s envoy to the United Nations, who was out in front on North Korea, saying it was time to “exhaust all of our diplomatic means before it’s too late.”

One U.S. government official told Foreign Policy that talk is circulating of Haley stepping in to replace Tillerson.

“There are very strong rumors – started last week – that he is out and she will take over,” the official said.

Trump is just skipping from one mini-crisis to another. And almost without exception, they are all of his own making to some degree.

If it’s not one thing it’s another, so if you’re long risk in the market, don’t get too comfortable now that the debt ceiling/CR can has been kicked for a few months. They’ll be something else Trump-related to worry about soon enough.

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