Four More Years

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If there’s one thing this recent election has taught me, it’s that large money works, and especially so for incumbents. I have to admit, given the Obama Administration’s horrible economic performance ($16T in debt, 26 mm out of work, 47 mm on food stamps), its near-totalitarian interference in markets via regulatory and legislative fiat (EPA coal & oil policies, Obamacare) and the series of scandals so common to the Chicago Machine politics of post-electoral pay-offs (Solyndra), extra-judicial bullying (Fast and Furious) and outright criminal incompetence (Benghazi), I thought there was no way the American people could re-up for more. But I guess enough money was spent, in just enough critical counties, to sufficiently demonize a genuinely nice guy who was trying to play it “nice” (probably to his chagrin) right to the end. Kudos to the players – the pros – like Axelrod and Jarrett. They had a plan and it worked.

Mr. Romney, you will be second guessed to a fare the well, and your lack of even McCain-level support will surely continue to raise questions. Perhaps there were enough Cain Thalers out there who wanted to see the whole system washed out, the Dems hung with it, and the process begun a new. I think you could have been more aggressive in the final weeks, and you took too much from the first debate win. I will not gainsay you, however, as I know your 20 years of unpaid service to your fellow citizens stand as their own testimony.

Unfortunately, reality doesn’t need a vote, and reality is now coming on a fast track. The dismal economic performance we’ve endured these past four years– hoping they would end mercifully this past week– is now slated to continue, barring some sea change in the Obama Directive. Anyone want to bet on the POTUS changing his stripes any time soon? The President’s recent announcement that increased taxes on the employment engine were necessary for his ongoing cooperation with the “Fiscal Cliff” negotiations should be fair warning. Thus far the analysis seems to read that he has learned nothing.

I would take some solace in the possibility of a “Bill Clinton” final four years, if only the Senate had mellowed. It did not, however, and in fact got more radical with the addition of two new far left Senators from the States of Massachusetts and Wisconsin. Bewildering especially was the inclusion of Elizabeth Warren in the Hall of the Hundred Most Powerful. Apparently, after being annealed on the moral forge of vehicular manslaughter, long term race fraud was just a mere bagatelle for the majority of the Bay State’s citizenry. A “Blue State,” for sure.

Given that there will be no Gingrich Congress to arm wrestle the much more ideological Obama to fiscal discipline, I expect nothing but more fiat excess and Executive consolidation. As a result, businesses will continue to be reluctant to invest, capital will “hide,” and more unemployment, crime and municipal stress will result as our debts and long term liabilities continue to skyrocket. None of this will be good for the long term health of the Republic, if in fact a republic we still own. I know even the famed Mr. Franklin (“You have a republic, Madame, if you can keep it!) might harbor his doubts at this gray pass.
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It’s ironic, I guess, that despite my despondency, I’m still reasonably well situated for this turn of events. Do I own growth stocks like AAPL and DDD? Do I own hot retail like ULTA or CAB? Do I own… (ahhh, you get the picture!). NO! I own a bunch of commodity plays that I am using as a hedge against what I like to call Bernanke’s Despair and you can call “QE (n+1).” We are staring at unfunded liabilities out the wazoo, and entitlement spending alone that outstrips current tax receipts by hundreds of billions of dollars. Bad debt and mispriced assets remain on balance sheets, particularly on those of your resident Too Big To Fail Bank (no Dodd-Frank). There is only one way out of this mess, and it’s the same thing I’ve been preaching to you for the last five years of our journey. PRINTPRINTPRINTPRINTPRINT.

You know the usual suspects, so I won’t belabor them. In particular right now, I like the way ERX looks right now (for those of you asking me about the oil plays in the last comment section). I like it better than UCO, too, fwiw, as it is bouncing right now off its 200 week EMA ($44.72). I don’t think it has many days left to pop. I of course love RGLD below $90. A gift to your grandchildren, as I’ve been telling you since it was in its low $30’s. For the speculators amongst us, keep an eye on TC… I think it’s finally getting it’s mojo back.

The next four years should be interesting… in the way of the ancient Chinese curse “May you live in interesting times.” Unfortunately, I believe China will be the least of our troubles, and soon we will look nostalgically back on the times when all we had to worry about was burrito accounting fraud.

Peace be upon you all.
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