Street Analysis

“You can fool all the people some of the time, and some of the people all of the time, but you cannot fool all of the people all of the time.”, the quote, widely attributed to the President Abraham Lincoln, says it all of current times.

Time has come and the Truth is out…for the most part.

No, it is not the Epstein files, the current rage of the populace. “It’s the economy, stupid”, the famous words associated with the President Bill Clinton and his campaign advisor during 1990s.

Party is over. Literally and figuratively…it is unofficially official! 😊

Genie is out of the bottle and these two, the most powerful actors in the world – Federal Reserve (Fed) and the current President of the United States (POTUS), Donald J. Trump, both are IN the bottle or boxed in metaphorically.

“Bakari dibbe me” as the saying in Hindi language goes, i.e. ‘goat in the cage’.

What people of America could not do easily, “Law of Karma” did or at least appears to start doing… just as it always does.

Federal Reserve (Fed):

Federal Reserve (Fed) is really in a tough spot with the current economy. Misery index (inflation plus unemployment) is only getting worse, not better, by the month. Split opinions on the rate cut by the Fed Governors for the upcoming December meeting precisely demonstrates that conundrum. The contemplated rate reductions due to heavy political pressure and the state of economy are being heavily debated within the Fed meetings.

On the one hand, we do need to reduce the interest rates given the weakening economy, though, on the other hand, we cannot ‘afford’ to do what is needed simply because it risks a major unleashing of even greater and greater inflation and dangers associated with it, which already is kind of out-of-control to a degree with its highly elevated level for the longest time with no indication of budging to more acceptable level. See the Consumer Price Index (CPI) chart below for the last 60 years, which shows it currently at one of the highest readings in last 30 years outside of the post COVID recovery time.

Similarly, 10-year treasury rate continues to hover around 4%, near 25 years high, and not backing down below that level in spite of two interest rate cuts this year. So is the case with the 30-year mortgage rate which also stubbornly stays at well upwards of 6%.

See the 10-year treasury rate chart below for the last 60 years.

President of the United States (POTUS):

President of the United States (POTUS) is out with two ‘unhinged’ proposals adding or crowning his long litany of highly questionable and even completely deranged things he has charted to do all along. They are both economic items pinned on usual suspects of getting attention and plain ‘appearance’ of doing something meaningful, a knee jerk reaction, conceived out of sheer fear of losing the ground further after election losses to democrats in New York, New Jersey and Virginia.

Snake Oil Product # 1:

First is the $2,000 ‘dividend’ check for everyone in America. Clearly, what does the term ‘everyone’ mean is being debated and discussed in the crony, corrupt and inept presidential administration which is full of thugs, goons and attack dogs. By the way, it is the money America does not have and cannot afford to dole out no matter how badly we want.

A simple math shows that the US has collected $192 billion thus far in the tariff revenues in FY2025 and if we were to give this handout to everyone, it will be upwards of $700 billion with the giant gap of $500 billion. That is on top of the $5 trillion deficit spending bill passed this summer via the President’s Big Beautiful Bill (BBB), which in fact, was nothing but one hUmongous, Ugly, Underwater Undertaking (U4).

In a major contrast, Norway, the Scandinavian country, has about $2 trillion sitting in its sovereign wealth fund amounting to about $400,000 per every individual in the country…every Individual. Whoa is the only word in terms of the positive feeling and astonishment! In America, instead we have a debt of about $38 trillion increasing by $2 trillion every year now which equates to over $100,000 for every individual…again…every Individual. In other words, the gaping hole of about half a million dollars per person between the two countries. Norway is positive. We are negative here.

We printed much money during the COVID time with a lot of stimulus. No one questions whether it was necessary. The only question was how much of it was necessary. Just as during the Great Financial Crisis (GFC) of 2008, Trouble Asset Relief Program (TARP) was necessary. Whether we underdid it or overdid it then during the GFC remains a lifelong debate.

However, right now, there is no basis to print more money…that is unless we want to go down to the hellhole at even the faster rate than we are going at this time. Suffering is on the rise on much of the populace here in America and we can only quicken the pace if we print more and more money like this that our buffoon President has no clue about except to fill his own pockets and his cronies’.

All we need to do is watch both the gold price and the 10-year treasury rate like a hawk. None of that is pretty, unfortunately. They both portend some more ugly times to come. Gold is up over 50% this year already at $4,000 an ounce and 10-year treasury rate does not want to go down below 4%.

Besides, even the revenue that has been generated out of the tariffs falls significantly short of what the outlay could be for the tariff ‘dividend’ checks as a simple math showed up above. It is another ‘terminology scam’ like that is being commonly used for ‘social security fund’, the fund that does not exist in reality with the U.S. government. Similarly, tariff ‘dividend’ is not out of some investment, which is generally the case with any dividends. It only will be out of even more deficit spending, if it were to even materialize, for which the odds are not that great.

Snake Oil Product # 2:

The second ill-conceived, if not outright foolish idea floated by the POTUS, is the 50-year mortgage product in wake of the recent election losses. It is akin to one ‘desperate’ person dangling a carrot in front of another ‘desperate’ person, a distressed house buyer who is planning to make the biggest purchase of his / her life during this housing affordability crisis. Actually, it is worse, it is not a desperate man dangling a carrot, rather it is the biggest conman in the U.S. history selling a snake-oil to an innocent or uninformed buyer. Chances are it is not going to fly, at least this time around. Thank God!!

Poll numbers for the POTUS are tanking materially with his popularity waning little by little even within his base. That is a good sign! He is getting in trouble gradually for sure. A little bit of a progress made by America, no matter how little. He even admitted that his numbers are ‘bad’, really the first or rather rarity per his conman playbook, though, the numbers are good amongst the ‘smart’ ones according to him. Imagine that! Oh, well, all we need to do is replace ‘smart’ with the ‘bootlicker supplicants’. That is where he does well and has always done well anyways without a doubt.

The stock ticker ‘DJT’ representing his eponymous firm, Trump Media & Technology Group, where bulk of his fortune is tied, clearly is a good proxy as it trades near 52-week low at around $10 now that ‘People of America’ are waking up gradually out of their long slumber, about 10 years. Enough damage, intentionally or inadvertently, has been done already, though, hoping no more at least from the actions of this country’s individual citizen’s standpoint. Thank God again!!

In summary, this $2,000 ‘dividend’ check and ’50-year mortgage’ are two snake oil products that can only inflict more harm on Americans if we end up buying it after having such products amply sold in last 10 years by this greatest conman in our history, the man who can be described in only three words: “Delusional Monstrous Evil” symbolizing recklessness and lawlessness unlike of Real America.

However, enough is enough. No more non-sense this country can tolerate. Everyone is at his or her wit’s end. Media is outright in the rebellion mode. It is quite refreshing to see how media stands up, really to this biggest bully of the world. People for their part are starting to wise up from their foolishness as well.

Also, take some MAGA (Make America Great Again) folks or firebrands. Major cracks have started to appear as they are turning on each other, not to mention some of the voters to this evil conman who have started to realize their mistake of voting for this evil to their and country’s detriment.

On the financial markets front…Nvidia (NVDA) announced solid results yesterday just as it was expected and has been reporting since it is on the tear due to artificial intelligence (AI) wave for the last 3 years. As a result, the rise in Nvidia stock price is not only breathtaking, but rather meteoric during this AI craze, which also appears to be peaking now.

Going forward the major capital expenditure (CapEx) outlays behind the AI party will be scrutinized heavily by the corporate world and need to be justified with the proper return-on-investment (ROI) calculations.

When and where would it all stop is anyone’s guess. However, the stock market is starting to crater after years of excesses and it appears to be the ‘beginning of the end’ for its irrational behavior. We can only hope that the rational heads prevail soon – in both the corporate world as well as the investor world.

AI CapEx binge may peak in a year or two, if not less, whereas the stocks are already peaking now.