Looking Through

Folks were rolling out the generic quotables Monday, as US markets were shuttered for the holiday, leaving everyone bereft of perfunctory color to cite. “Markets needed a breather or even a pull back to justify reflationary expectations,” Medley’s Ben Emons told Bloomberg.

Ok, sure. That’s a contextless, amorphous, floating quote that works.

The narrative now seems to revolve around the notion that risk assets “need” to retreat after running up furiously into the inauguration, which will unfold this week under heavy security. There’s little to be excited about on the data front. Jobless claims are back near 1 million and consumer spending is in retreat. As for the “fundamentals,” earnings season is likely to see corporate profits shrink 11% although, as discussed here and illustrated in the table (below), results will vary widely (and wildly) by sector.


Nobody is likely to care too much about Q4’s numbers anyway. It’s another “look through” quarter. “Through” to brighter days when a new administration donning blue hats plans to “make America a democracy again.” Is a subpar democracy better than a “great” autocracy? The answer isn’t always “yes.” But in America’s case, it’s safe to say the next four years will be preferable on a number of fronts to the last four.

Speaking of that, analysts are ratcheting higher their expectations for government spending and US growth in light of Joe Biden’s stimulus package which, all efforts to stymie the plan aside, is likely to make it through Congress close to intact.

That doesn’t mean compromise won’t be required on some areas (like state and local aid), but Republicans are reeling. They lost the White House and the Senate, and dozens of them (if you include House members who backed the bid to overrule voters and toss out the election results) tacitly supported an insurrection against the government.

New footage from that highly unfortunate debacle was released over the weekend by The New Yorker. The tapes showed the outgoing president’s supports rifling through desks and paperwork on Capitol Hill and saying things like: “Cruz would want us to do this, so I think we’re good.” “Among The Insurrectionists,” is an incredible piece, even as New Yorker pieces go.

The events of the past three months have weakened the GOP’s hand, and splintered the party into two factions, one of which is comprised at least partially of conspiracy theorists and lawmakers loyal to the outgoing regime. It sounds as though Trump will preside over that wing of the party as a kind of dictator in exile, headquartered at Mar-a-Lago. It really is a tale straight out of a banana republic — only with elements of total farce and an unmistakable tinge of humor commingled with tragedy.

All of that to say the following. There’s some truth to the notion that Biden could find reaching across the aisle difficult amid the partisan rancor likely to accompany a Senate trial where Trump could be convicted in absentia. But some Republicans clearly regret the party’s metamorphosis into a personality cult and will been keen to start picking up the pieces starting Wednesday.

Paradoxically, that could mean collaborating with Biden to get real, sizable relief to voters. Trump’s most fervent supporters likely won’t be dissuaded from their loyalty by a $1,400 check from Janet Yellen. But they’ll cash it, that’s for sure. And if the virus finally bows to science say, in the second half of the year, helping people get back to work and quite possibly allowing folks to start leaving their masks at home on trips the grocery store, the chances of the “rolling insurgency” that some fear could grip the nation would recede.

The New Yorker‘s account of the Capitol Hill riots, while harrowing, at times underscores the abject absurdity of it all. I’ll leave you with one indicative passage:

Some senators had printed out their prepared remarks for the election certification that the insurrectionists had disrupted. The man in the hard hat found a piece of paper belonging to Ted Cruz and said, “He was gonna sell us out all along–look! ‘Objection to counting the electoral votes of the state of Arizona.’ ” He paused. “Oh, wait, that’s actually O.K.”


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2 thoughts on “Looking Through

  1. Luke Mogelson deserves a Pulitzer. He connects the dots for a conspiracy of insurrection. Good thing security has been enhanced Nationwide because extreme FOMO will result for the Cons.
    As Woodstock was to the Libs the Capital Breach will be to the Cons. Another pointless American Myth.

  2. Brokerage firms have to obtain employment status, annual income and net worth from individuals seeking to open a new account. Might be enlightening to ask firms — especially the Robin Hoods of the B/D world — to disclose their metrics here. It might be at least partially enlightening as to whether the stimulus checks were being invested in the market. Perhaps also they could disclose the number of accounts buying partial shares. Neither would be exact indicators, but perhaps useful in this argument.

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