Best of the Week
Most Popular
1. Climate Change Mass Extinction - Birds, Bees and Bugs: Going Going Gone - Richard_Mills
2.A Purrrfect Gold Price Setup! - Peter_Degraaf
3.Who Finances America's Borrowing? Recession Indicator for Independent Thinkers Part 2 - F_F_Wiley
4.America’s One-sided Domestic Financial War - Raymond_Matison
5.Gold Price Summer Doldrums - Zeal_LLC
6.Two Key Events Will Unleash Gold - Jim_Willie_CB
7.Billionaire Schools Teacher in NAFTA Trade Talks - Richard_Mills
8.Get Out Of Crypto Cannabis Bubble Before It Pops and Move Into Bargain Basement Miners - Jeb_Handwerger
9.Stock Market Could Pullback for 1-2 weeks, But Medium Term Bullish - Troy_Bombardia
10.G7 Chaos, Central Banks and US Fed Will Drive Stock Prices This Week - Chris_Vermeulen
Last 7 days
Trouble Spotting Market Trends? This Can Help - 22nd Jun 18
Financial Markets Analysis and Trend Forecasts 2018 - A Message from Nadeem Walayat - 21st Jun 18
SPX Bouncing Above Support - 21st Jun 18
Things You Need To Know If You Want To Invest In Bitcoin Now - 21st Jun 18
The NASDAQ’s Outperformance vs. the Dow is Very Bullish - 21st Jun 18
Warning All Investors: Global Stock Market Are Shifting Away From US Price Correlation - 20th Jun 18
Gold GLD ETF Update… Breakdown ? - 20th Jun 18
Short-term Turnaround in Bitcoin Might Not Be What You Think - 19th Jun 18
Stock Market’s Short Term Downside Will be Limited - 19th Jun 18
Natural Gas Setup for 32% Move in UGAZ Fund - 19th Jun 18
Magnus Collective To Empower Automation And Artificial Intelligence - 19th Jun 18
Trump A Bull in a China Shop - 19th Jun 18
Minor Car Accident! What Happens After You Report Your Accident to Your Insurer - 19th Jun 18
US Majors Flush Out A Major Pivot Low and What’s Next - 18th Jun 18
Cocoa Commodities Trading Analysis - 18th Jun 18
Stock Market Consolidating in an Uptrend - 18th Jun 18
Russell Has Gone Up 7 Weeks in a Row. EXTREMELY Bullish for Stocks - 18th Jun 18
What Happens Next to Stocks when Tech Massively Outperforms Utilities and Consumer Staples - 18th Jun 18
The Trillion Dollar Market You’ve Never Heard Of - 18th Jun 18
The Corruption of Capitalism - 17th Jun 18
North Korea, Trade Wars, Precious Metals and Bitcoin - 17th Jun 18
Climate Change and Fish Stocks – Burning Oxygen! - 17th Jun 18
A $1,180 Ticket to NEW Trading Opportunities, FREE! - 16th Jun 18
Gold Bullish on Fed Interest Rate Hike - 16th Jun 18
Respite for Bitcoin Traders Might Be Deceptive - 16th Jun 18
The Euro Crashed Yesterday. Bearish for Euro and Bullish for USD - 15th Jun 18
Inflation Trade, in Progress Since Gold Kicked it Off - 15th Jun 18
Can Saudi Arabia Prevent The Next Oil Shock? - 15th Jun 18
The Biggest Online Gambling Companies - 15th Jun 18
Powell's Excess Reserve Change and Gold - 15th Jun 18
Is This a Big Sign of a Big Stock Market Turn? - 15th Jun 18
Will Italy Sink the EU and Boost Gold? - 15th Jun 18
Bumper Crash! Land Rover Discovery Sport vs Audi - 15th Jun 18
Stock Market Topping Pattern or Just Pause Before Going Higher? - 14th Jun 18
Is the ECB Ending QE a Good Thing? Markets Think So - 14th Jun 18
Yield Curve Continues to Flatten. A Bullish Sign for the Stock Market - 14th Jun 18
How Online Gambling has Impacted the Economy - 14th Jun 18
Crude Oil Price Targeting $58 ppb Before Finding Support - 14th Jun 18
Stock Market Near Another Top? - 14th Jun 18
Thorpe Park REAL Walking Dead Living Nightmare Zombie Car Park Ride Experience! - 14th Jun 18

Market Oracle FREE Newsletter

5 "Tells" that the Stock Markets Are About to Reverse

The Swamp Strikes Back

Politics / US Politics Aug 30, 2017 - 10:10 PM GMT

By: John_Browne

Politics

On August 21st many Americans witnessed the moon cast a historic but short-lived shadow across the United States. One day later, President Trump reversed his previously stated position on the 16 year old Afghan War, thereby eclipsing the possibility that the United States would finally come to its senses and rethink a failed strategy that is likely to fail for years, perhaps decades, to come. The abrupt change, in what had been a central plank in candidate Trump’s appeal to voters thirsting for change in American foreign policy, came hard after the departure of Steve Bannon from the White House. As a self-avowed nationalist, Bannon had represented a true break in interventionist Republican thinking that had entangled the United States in intractable conflicts around the globe. To put an exclamation point, Sebastian Gorka, the last remaining proponent of the Bannon perspective, was forced out of the White House. The counter-revolution appears to be complete.


In his widely-followed speech regarding Afghan policy, Trump now appears to favor a widening of the military effort to insure that the United States continues to exert an influence on a remote central Asian region, where it is often said that empires go to die.

A big part of Trump’s “drain the swamp” appeal, lay in his promise to change the politics of Washington. To many voters, such a shift would include a break from America’s “Neo-Con” agenda of foreign intervention, which has deeply enmeshed the country in foreign politics and has enriched the defense industry and its lobbyists. However, given the Administration’s failure to break the Congressional inertia with respect to healthcare and now its reversal on Afghanistan, it appears as if the swamp refuses to be drained.

Recent elections in the U.S. and Europe have exposed deep-seated public distrust, suspicion and anger at the political establishment. Most had expected that the 2016 Presidential election would be a test of established figures, but populist elements in both parties soon took center stage. Against almost all political calculations, Trump ousted Jeb Bush as the establishment Republican candidate and went on to win the Presidency. The political establishment was stunned, and has yet to come to terms with the people’s choice. Now it appears that the entire establishment is united in a common aim to destroy the duly elected President.

The fact that business as usual now appears to be remaining so is manifesting itself with growing popular frustration. The past few days have seen an increase in politically motivated street violence in America. Meanwhile, the grass roots supporters of Sanders and Trump fight in the streets and on university campuses.

It appears that Bannon was squeezed out of the White House by establishment Republicans. In other words, the swamp swamped him, and America is just as stuck in Afghanistan as she ever was. While Trump may have insisted on better tactics, including increased aggression and more realistic rules of engagement, our servicemen and women will continue fighting a sixteen-year war on ground chosen by and favoring the enemy. Normally, history illustrates that given a determined enemy, and particularly one with sanctuary neighbors like Pakistan, even the largest armies lose. Such was the case in Vietnam.

The likelihood for real change in foreign policy has been mirrored by equal despair in the realm of healthcare. Based on the intransigence and hypocrisy of Congressional Republicans, and the failure of the Trump Administration to honestly and meaningfully grasp the policy details of healthcare, it appears as if the promise to repeal and replace Obamacare is now on life support, if not already dead on the table. It is starting to dawn on many Trump voters that effective deregulation and meaningful tax reform may vanish down the same rabbit hole.

It is become ever more probable that the United States will be left with increased government spending, ever greater public debts, and an expansion of identity politics and the welfare state. A stalling of enterprise, recession, and a fall in tax revenues may follow. America may resume the downward path carved by past Republican and Democrat politicians most markedly over the past half century.

If Government debt explodes, confidence in the U.S. economy and its dollar could fall, likely forcing interest rates to rise, possibly in the face of a recession. As hope for an enterprise revival fades, stock markets could stall and then fall dramatically.

But, currently, stock markets are heading for new highs, supported by oversize gains in biotech, transports and financials. Most likely these gains are based still on the blind hope that Republican and Democrat establishments will not succeed in sabotaging Trump’s goals, including the repatriation of up to $5 trillion of U.S. corporate earnings marooned overseas, and cuts to the U.S. corporate income tax rates that would make U.S. corporations more competitive globally. If those initiatives disappear into the swamp, look for U.S. stocks to come under selling pressure.

Investors should concentrate hard on determining whether current ascendency of the establishment represents a skirmishing success or a major trendsetting victory. Regardless, Trump will continue to face resistance from Republican establishment leaders until he shows more determination to root out swamp personnel from the White House and from within his Administration.

Should Trump fail, Americans in his power base will feel betrayed, seriously disappointed and may take matters increasingly into their own hands on the streets. People from all sides, including those of allied nations, should fear such an outcome that now is poised menacingly to cast a dark and lasting shadow over America.

History shows that when the people hold their established politicians in open contempt and fight each other not with words in parliaments but with fists and weapons on the streets, as they did in the French and Russian Revolutions and in Weimar Germany, the results threaten democracy. Amazing as it may seem, this worrying specter now faces the United States.

For many Americans, Trump’s election offered hope - that government would concentrate on defending the country, protecting citizens under the law, bringing immigration within the law, rebalancing trade deals and removing ensnaring regulations and crippling taxation. In the months following the election, the optimism fed into the markets and helped push stock prices up to record levels. As a Member of the English Parliament under Margaret Thatcher, I witnessed almost all these results at first hand. In particular, deregulation and lower tax rates triggered an economic renaissance and higher total tax revenues from increased earnings.

There can be little doubt that the American economy has declined markedly in recent years. But the truth has been kept from ordinary people by the surreptitious manipulation of key statistics such as inflation and employment figures and the massive deployment of fake money.

Ordinary Americans suffer falling living standards as the income gap continues to widen. They sense this as grossly unfair and blame correctly their establishment politicians who have feathered their own nests unashamedly. They are demanding change, and if it can’t come through the democratic process, the results could be ugly.

Read the original article at Euro Pacific Capital

Subscribe to Euro Pacific's Weekly Digest: Receive all commentaries by Peter Schiff, Michael Pento, and John Browne delivered to your inbox every Monday.

By John Browne
Euro Pacific Capital
http://www.europac.net/

More importantly make sure to protect your wealth and preserve your purchasing power before it's too late. Discover the best way to buy gold at www.goldyoucanfold.com , download my free research report on the powerful case for investing in foreign equities available at www.researchreportone.com , and subscribe to my free, on-line investment newsletter at http://www.europac.net/newsletter/newsletter.asp

John Browne is the Senior Market Strategist for Euro Pacific Capital, Inc.  Mr. Brown is a distinguished former member of Britain's Parliament who served on the Treasury Select Committee, as Chairman of the Conservative Small Business Committee, and as a close associate of then-Prime Minister Margaret Thatcher. Among his many notable assignments, John served as a principal advisor to Mrs. Thatcher's government on issues related to the Soviet Union, and was the first to convince Thatcher of the growing stature of then Agriculture Minister Mikhail Gorbachev. As a partial result of Brown's advocacy, Thatcher famously pronounced that Gorbachev was a man the West "could do business with."  A graduate of the Royal Military Academy Sandhurst, Britain's version of West Point and retired British army major, John served as a pilot, parachutist, and communications specialist in the elite Grenadiers of the Royal Guard.

John_Browne Archive

© 2005-2018 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules