We ended the week with the Supreme Court deciding the President did not have the authority to place tariffs under the specific authority that it was implemented under.
The President immediately announced new 15% tariffs.
I am not certain what authority he has to do such and I am at a loss to figure out how the previous tariffs will be refunded.
The confusion was a non-starter for the stock market this week and could put the brakes on reaching new record closing highs.
You take that concern and add what is happening to Crypto and it should give investors a pause.
I’m not trying to pile on, but you also have the situation with Iran.
I will not list all of the foreign policy issues as your publisher already has an issue with this column’s length, but they are vast to say the least.
There has been a shift in investing from the Mag 7 to HALO stocks.
I believe acronyms will be the downfall of modern society, but I digress.
HALO stands for Heavy Assets Low Obsolescence.
An example of such a stock is Caterpillar - a heavy equipment maker used for construction of power plants, mining and data centers.
It is similar to the trend we are seeing in the job future with AI.
My grandson probably will go into some form of trade service and skip college.
This is a young man who is in the Honor Society making straight A’s.
Just the reality of adapting to a new technology.
Another thing this will bring is the growing possibility of a recession, if society does not adapt fast enough, there will be dislocations.
Not a prediction, but anyone who thinks the economy is going to expand continuously really ignores history.
There are always obstacles to be overcome.
As I’ve mentioned here before, one of our country’s biggest issues isn’t technology, but the full faith and credit of our currency.
The dollar is the world’s fiat currency.
That means people have faith in its value.
That faith has been tested lately.
China desperately wants its currency to be the fiat currency.
The advantage for the US having the dollar holding in place with the world is beyond significant.
It impacts our ability to negotiate with our trading partners.
It has a huge impact on the actual profit or loss in trade with other counties.
As we all know, being a second class customer has its limits.
What I see happening currently is the clash between social issues and economic issues.
Many want to dismiss economic issues as the US is the richest nation in the world and does not need to worry.
Nothing could be farther from the truth. Economics, however, is far from interesting.
Trying to take care of the vast array of social issues has gravitas and emotion.
Much the same as doing with less and avoiding debt.
How much fun can that be?
It alleviates some worry but really doesn’t move the needle.
The problem is that you can’t ignore the economy.
As political analyst James Carville said years ago when Bill Clinton got elected: It is the economy stupid.
It is just a way of saying that you cannot ignore this subject or try to explain it away.
People know when they are feeling better about their financial situation.
Telling them they are in good shape when they are not fools no one.
You don’t have to bang the drum when times are good either.
Keeping the boat headed in the right direction at the right speed is the real task at hand.
It may bore you to death but it is real.
The time between now and November will be the text of what the public will believe.
Are the times good or treacherous.
I avoid politics like I avoid the flu. I hope we find a way to balance the need to assist is rectifying social issues with a logical financial plan.
That of course runs in the face of what politics is all about.
