The results are pretty good, the message, not so much. And that is the State of The Donald Today. A front page article in the Wall Street Journal Thursday reports that Iowa has a state leading low unemployment rate, a mere 2.9%.
The results are pretty good, the message, not so much. And that is the State of The Donald Today. A front page article in the Wall Street Journal Thursday reports that Iowa has a state leading low unemployment rate, a mere 2.9%. The problem is that there are literally not enough workers to fill the positions available. Community college training centers lack individuals to train.
This is the result of massive cuts in business regulation. This is the result of cutting the corporate tax rate 40%. This is the result of making the USA more energy independent than it has ever been. ISIS is on the run in the Middle East. And the caravan from Central America is idling now in southern Mexico.
All these campaign promises have been kept. Nancy Pelosi no longer mentions the "thousand dollar crumbs" delivered in bonuses to workers. All of a sudden the worst bill passed in American history (the tax cut) is no longer mentioned. All the Democrats were AWOL on that legislation.
But a negative media never mentions the accomplishments. And in the Alabama Senate race, the Pennsylvania House race, and the Wisconsin Supreme Court race, Democrats turned out but Republicans did not. And with 36 Republicans not seeking re-election in the House, these become open seats. An open seat is much easier for a challenger than facing an incumbent. And frankly one has to wonder, would the Republicans secretly be glad to lose the House, blame it on Trump, and be done with him? And of course, handily blame it all on Trump tweets and bombastic comments. A loss of the House will surely mean impeachment proceedings for whatever reason of the moment, and end the Trump Presidency. In a recent column I suggested The Donald listen to someone to whom he could not say, you’re fired. Donald, are you listening?
Donald’s approach to legislation and negotiation reminds me of Sam Nunn’s description of Barry Goldwater’s approach. Nunn described the approach as Ready, Fire, Aim! This art of the deal consists of outrageous, no way to compromise remarks, then a surprise reaction from the targets of this wrath, and then two weeks later, a complete softening of the position. Now we learn that most of the tariffs would not take hold for a couple of months, so let’s play nice and negotiate.
Just as Nancy stopped talking about $1,000 paycheck bonuses, Trump and Commerce Secretary Wilbur Ross are not asking if you have looked at your 401K lately. No wonder, as the Dow reverberates 500 – 700 points either way on an intra-day basis. Donald, this is not winning friends and influencing people….
But the February low at 23,300 has held. The markets moved up nicely Wednesday and Thursday this week. Boeing, Chevron, Caterpillar, and Nike snapped back. For the technically inclined, the Dow Industrials registered a buy signal on the daily point and figure chart.
And we are seeing some positive green shoots for the Permian Basin. The XLE Energy ETF bounced 1.8% today. Marathon MRO was up 5.73%. Freeport McMoran FCX jumped 4.44% which is bullish for gold and copper. The SPX advanced 18.15 and a good close this Friday would be encouraging. Donald may pull this out yet.
My greatest concern has been the weakness in the energy service sector. The XES has traded just above its 2009 lows. Thursday it did advance 3.64%. It is below all four of the moving averages I follow. So a rally here would be most encouraging.
Finally I have suggestions for a possible "knock it out of the park" rebound. Tanger Factory Outlets SKT is one of the top five tourist destinations in Texas. Located in San Marcos between Austin and San Antonio, it boasts dozens of ‘outlet stores.’ The parking lot is packed on the weekend with numerous Mexican license plates. SKT has fallen from $39 to $22.18. It pays a 6.29% dividend.
Floserve FLS has fallen from $77.50 to $44.81. The dividend is meager at 1.76% but it is a beaten down well –run company.
Apache APA has discovered the Comstock Lode of oil in the Davis Mountains. IT is making a higher low above $33 now at $38.75.
Put them on your radar screen.
Dennis Elam is a professor at Texas A&M University in San Antonio. Follow Dennis at http://www.themarketperspective.com.