Ghosts of Christmas Past
EYE ON THE MARKET OUTLOOK 2020
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Mao Zedong, who ruled Communist China from its establishment in 1949 until his death in 1976, is delighted to
see Xi Jinping proclaimed “President for Life” as China scraps the two-term limit it had imposed on presidents since the 1980s. President Xi has cited Mao’s “long march” struggle against the Kuomintang as precedent for China’s current strategic conflict with the US, which indicates a limit to which China will compromise on mercantilist policies that it sees in its own self-interest.
Mao Zedong
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Mao Zedong
Franklin D. Roosevelt, the most progressive President of the 20th century who once proposed a 100% income tax and whose reforms shifted economic power from Wall Street to Washington, is celebrating the even more progressive proposals of Elizabeth Warren.
Franklin D. Roosevelt
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Franklin D. Roosevelt
Mao Zedong, who ruled Communist China from its establishment in 1949 until his death in 1976, is delighted to see Xi Jinping proclaimed “President for Life” as China scraps the two-term limit it had imposed on presidents since the 1980s. President Xi has cited Mao’s “long march” struggle against the Kuomintang as precedent for China’s current strategic conflict with the US, which indicates a limit to which China will compromise on mercantilist policies that it sees in its own self-interest.
Richard Nixon, who bullied Federal Reserve Chair Arthur Burns in the early 1970s into lowering policy rates through a series of trademark “dirty tricks” and false press reports, is enjoying the sight of Donald Trump doing some of the same to Fed Chair Jerome Powell. Policy rates net of inflation are once again around zero despite a growing economy at full employment.
Franklin D. Roosevelt, the most progressive President of the 20th century who once proposed a 100% income tax and whose reforms shifted economic power from Wall Street to Washington, is celebrating the even more progressive proposals of Elizabeth Warren.
2020 Outlook: Our Ghosts of Christmas Past cover
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Richard Nixon, who bullied Federal Reserve Chair Arthur Burns in the early 1970s into lowering policy rates through a series of trademark “dirty tricks” and false press reports, is enjoying the sight of Donald Trump doing some of the same to Fed Chair Jerome Powell. Policy rates net of inflation are once again around zero despite a rowing economy at full employment.
Richard Nixon
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Richard Nixon
This year’s cover depicts Ghosts of Christmas Past, all of whom have returned to either celebrate or bemoan some notable trends for the year 2020:
Henry VIII, who in 1533 made England a sovereign, independent nation not subject to externally imposed laws through The Act in Restraint of Appeals, is pleased about a possible Brexit. Henry is joined by Prime Minister Margaret Thatcher. In our reincarnation, we depict the Margaret Thatcher that raised concerns about a European superstate exercising dominance from Brussels, and who told biographer Charles Moore in her later years that Britain should leave the EU. While Boris Johnson’s victory in December reduces some Brexit/referendum uncertainty, Conservatives maintain they will not soften Brexit terms and will not seek an extension at the end of 2020; whether the EU agrees is another matter entirely.
Herbert Hoover sees his reflection in Trump, who also imposes tariffs on imported goods and deports immigrants. After the recent Phase I deal, tariffs are still at the highest level in 40 years and could rise again depending on Chinese compliance. On immigration, Hoover’s Administration launched the “American Jobs for Real Americans” campaign and reimbursed state and local governments for deportation measures. Hoover’s deportations took place when unemployment was 15%–20% compared to 3.5% today.
Charlemagne's reunited Western Roman Empire stretched from the English Channel to the Balkan Peninsula, but disintegrated shortly after his death in 814 A.D. in a series of civil wars. As a force for a united Europe, Charlemagne is unhappy to see the Eurozone project floundering yet again with low growth, trillions in negative yielding government debt, political fragmentation and limited progress on Federalism.
The Pets.com Sock Puppet has become a metaphor for the dot.com era: In 1999, Pets.com made $620K in revenue and had operating losses of $20 million, since it was selling merchandise for roughly one-third of what it cost the company to buy it. The puppet is wagging his tail, since while we have not reached the excesses of the late 1990s, the share of US market capitalization and corporate spending from young, unprofitable companies is at its highest level since then. To bookend the Pets.com saga, SoftBank has now abandoned its investment in the dog-walking app Wag, which it had valued at over $600 million.
Herbert Hoover sees his reflection in Trump, who also imposes tariffs on imported goods and deports immigrants. After the recent Phase I deal, tariffs are still at the highest level in 40 years and could rise again depending on Chinese compliance. On immigration, Hoover’s Administration launched the “American Jobs for Real Americans” campaign and reimbursed state and local governments for deportation measures. Hoover’s deportations took place when unemployment was 15%–20% compared to 3.5% today.
Herbert Hoover
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Herbert Hoover
Charlemagne’s reunited Western Roman Empire stretched from the English Channel to the Balkan Peninsula, but disintegrated shortly after his death in 814 A.D. in a series of civil wars. As a force for a united Europe, Charlemagne is unhappy to see the Eurozone project floundering yet again with low growth, trillions in negative yielding government debt, political fragmentation and limited progress on Federalism.
Charlemagne
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Charlemagne
Henry VIII, who in 1533 made England a sovereign, independent nation not subject to externally imposed laws through The Act in Restraint of Appeals, is pleased about a possible Brexit. Henry is joined by Prime Minister Margaret Thatcher. In our reincarnation, we depict the Margaret Thatcher that raised concerns about a European superstate exercising dominance from Brussels, and who told biographer Charles Moore in her later years that Britain should leave the EU. While Boris Johnson’s victory in December reduces some Brexit/referendum uncertainty, Conservatives maintain they will not soften Brexit terms and will not seek an extension at the end of 2020; whether the EU agrees is another matter entirely.
Henry VIII & Margaret Thatcher
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Henry VIII & Margaret Thatcher
The Pets.com Sock Puppet has become a metaphor for the dot.com era: In 1999, Pets.com made $620K in revenue and had operating losses of $20 million, since it was selling merchandise for roughly one-third of what it cost the company to buy it. The puppet is wagging his tail, since while we have not reached the excesses of the late 1990s, the share of US market capitalization and corporate spending from young, unprofitable companies is at its highest level since then. To bookend the Pets.com saga, SoftBank has now abandoned its investment in the dog-walking app Wag, which it had valued at over $600 million.
The Pets.com Sock Puppet
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The Pets.com Sock Puppet
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