The Constitution, Article II, Section 4:
The President, Vice President and all civil Officers of the United States, shall be removed from Office on Impeachment for, and Conviction of, Treason, Bribery, or other high Crimes and Misdemeanors.

Friday, July 20th, 1787 James Madison’s Notes from the Constitutional Convention

Mr. {Elbridge} Gerry urged the necessity of impeachments. A good magistrate will not fear them. A bad one ought to be kept in fear of them. He hoped the maxim would never be adopted here that the chief magistrate could do no wrong.

Thank God for Mr. Elbridge Gerry. Just as a side note: Mr. Gerry refused to sign the Constitution. Why? It didn’t include a Bill of Rights. That came later.

Last March, I wrote a blog piece about Kim the Young-Un, referencing the old Twilight Zone episode about Little Anthony, played by Billy Mumy. If you made little Anthony mad, he had the power to turn you into a jack-in-the-box. We appear to have a similar situation with DtheT, and just about everybody with whom he’s come into contact. There’s poor Mittens, humiliated beyond belief in his false hunt for that SofS position. Or how about Carly Fiorina, not just humiliated over her sharp-nosed looks during the campaign, but now forced to suck DtheT’s toes in search of a lesser position somewhere in the Trump shelf of acolytes (won’t call it a cabinet). But the two most egregious acts of humiliation were reserved for the Tweeter-in-Chief-Elect’s alleged “friends”: Chris Christie and Rudy Giuliani.

Christie made the mistake of having his Joisey subordinates convicted of messing with traffic on a bridge. But was that really it? Nah. And Rudy? Allegedly blowing his own horn too loudly? Was that what got him bounced from consideration for SofS? Nah. What these two have in common in making little Anthony, er DtheT, stop thinking about them for anything, was this:

Neither man offered Trumplethinskin anything of value going forward.

Rex Tillerson is now the nominee for SofS. His friendship with Vlad the Impaler will be DtheT’s entree into what DtheT thinks will be the battle of the Titans between he and Vlad. This plot line comes straight out of Buffy the Vampire Slayer or The Lost Boys – yeah, that one is better. But which one is Michael, and which one is David? Interesting that those two characters have biblical names. Hey – maybe The Lost Boys was allegorical? Sure enough, that’s what we have before us. King Ralph (Michael the Archangel?) vs Vlad the Bad (David, the Blond Kiefer)?

I’m fairly certain this joust is not going to end well. And if I were a citizen of Lithuania, Estonia or Latvia, I’d worry about becoming Paul, Dwayne or Marko..satellites in David’s orbit. All Michael had to help him kill the Vampires was his brother Sam and The Frog Brothers. But the two Coreys and the other guy were really there for comic relief from all that neck biting. So really, DtheT will have to fight this epic battle alone. Of course, that’s not a problem – he prefers it that way.

So who will win? Will Anthony (DtheT) put Vlad the Bad in a box? Or will Mr. KGB put Selfish Diaper Baby in a corner/playpen? Wait, watch and pray that the battle doesn’t morph into something for which we all will pay.

The other day, Erik said DtheT reminded him of that old movie, King Ralph. That’s the one that starred John Goodman as the inapt/inept king of the United Kingdom, brought to that position through a freak accident involving the making of media. That made me think about the cartoon character, Wreck-It Ralph, voiced by the adoreable John C. Reilly, generally cast as the sidekick but with a voice that just works with a cartoon – or a cartoonish character (see Talladega Nights). Wreck-It Ralph is tired of being the bad guy in the video game, and sets out to become the good guy. Lots of controversy follows in his wake. But the quotes from the film are really on-point. Which quotes are those?

Well, let’s start with this one.

Wreck-It Ralph: I know, I know. I’m an idiot.
Vanellope von Schweetz: And?
Wreck-It Ralph: And a real numbskull.
Wreck-It Ralph: A selfish Diaper baby.
Wreck-It Ralph: A stinkbrain?
Vanellope von Schweetz: The stinkiest brain ever.

I think this one is particularly on point with the analogy:

Sonic the Hedgehog: Stay alert, because if you die outside of your own game, you don’t regenerate, ever, game over.

Then there’s the ‘ultimate’ quote that answers the question: “Why did DtheT even want to be president?” This comes courtesy of King Ralph.

The first question every car buyer asks themselves is ‘Will this car get me laid?’

So DtheT is the numbskull, selfish diaper baby, asking himself if buying the job of president will get him laid, and then realizing he must stay alert, because he’s outside his own game…and he’s beginning to understand Sonic the Hedgehog’s guidance.

So we need a Cedric Willingham or a Princess Vanellope to save us. Unfortunately, O’Toole is dead, so Sarah: you’re up!* Oh Geez, not THAT SARAH! This one!

*Palin never really said those words. She did once confuse which of the two Koreas was our ally, but hey, potato, potato..

At the Opec meeting in Vienna last week, the cartel members agreed to cut production in order to decrease supply. Their hope is that prices will increase beyond the average $50 a barrel level. All members are keenly aware of the fact that a huge cache of oil and natural gas has been located by the USGS near Midland, Texas.

How much oil was found, you ask? How about the largest ever found in the US? We’re talkin’ 20 billion barrels of oil and 16 trillion cubic feet of natural gas? So where was this oil hiding? In plain sight, apparently. What’s different is the new technologies that let shale oil come to the surface. New technologies? Yes – the F word…no not that one, Fracking. Yes, boys & girls, we’ll be seeing lots more fracking in the future. That technology that has caused earthquakes in Oklahoma and that utilizes billions of gallons of water for extraction. What’s the problem with that? Well, I wouldn’t like to live in Oklahoma and have a building fall on me – or live in Midland and have my water well run dry from the cumulative effect of lowering the aquifer in an area destined to be extremely dry as a function of global warming. So, in essence, we’ll be trading oil now for habitability then. Well, there’s lots more real estate in the US – big deal. Tell that to those folk that like living there.

The effect of fracking on the price of oil has been significant. As I detailed in a post from a year or so ago, the producer making money at current prices is Saudi Arabia. Canada, Russia, the US and China have producer prices less than current, but not nearly as much less as the Saudis. So, reluctantly, the Kingdom agreed to curtail production. Why reluctantly? They need the income to stave off dissent. Russia needs the production because of sanctions causing their budget deficit. Canada and China are in the middle somewhere, and the US is on the verge of developing this Wolfcamp shale formation to produce even more oil. Even at $51 a barrel, the economics are there to frack that shale. So OPEC is living on borrowed time and they know it. With the Middle East being a cauldron of distress, the next couple years’ are going to be difficult for Saudi Arabia, the UAE, Iran, Iraq and Kuwait. But oil prices won’t help any of those folks in OPEC quell their dissenters. Venezuela is probably in the most trouble, due to a combination of bad governance and declining capacity from lack of cash. That country is about to implode, with hyperinflation and starvation right around the corner. Can you spell revolución?

Prepare ye the way of the loud – and hope it doesn’t come to a town or city near you.

Read a piece in The NY Times talking about the same topic I’ve been discussing for the past week or so. They featured a manufacturer in the midwest that makes recliner chairs for movie theaters. Where do most of his raw materials come from? Yep – from China. Tariffs on imports from China will make his products LESS competitive than his competitors in Mexico, Colombia and Australia. So what will he likely have to do? If he raises his prices, he’ll sell less and likely lay off workers. If he pays more for raw materials and charges the same price, he’ll be out of business in rather short order, and lay off ALL his workers. So with higher priced raw materials from China, he’ll turn to suppliers elsewhere, like Vietnam. And which group of manufacturers are looking in relocate to places like Vietnam and even Africa? Chinese manufacturers.

Obama caved to pressure in 2009 from American tire manufacturers and slapped a 35% tariff on Chinese tires. 45% is the number that’s being bandied about by spokespeople for Trumponomics. What was the result of that Obama tariff on Chinese tires? 1200 tire manufacturing jobs were saved. But the cost to consumers increased by over a billion dollars. What did those consumers do? They spent less elsewhere. The net result? The loss of 2,500 retail jobs. This is all according to the Peterson Institute for International Economics, ostensibly a non-partisan think tank. But it’s run by Pete Peterson, who is no bleeding heart liberal. So I think these numbers are real.

Here’s the thing: at some point, DtheT will get bored with all this and turn it ALL over to the Republicans. Those folk are not the sharpest knives in the drawer, and have been preaching this kind of nonsense for so many years, they’ve convinced themselves that it’s truly the way to proceed. So when DtheT “lets go” and lets the “Freedom Caucus” run things, we will see tariffs, potentially withdrawal from the WTO and other insane moves. Be prepared to see a party very much in disarray within a year of DtheT and President Pence taking office. A whiff of impeachment will fill the air…the last thing we need. Won’t be too long before all these folk that voted for Trump will be wishing they had Barry O back. Ironic, eh?

The Senate voted to extend sanctions on Iran for another 10 years. Because it had bipartisan support, Obama may have no choice but to sign it. Iran has threatened retaliation if it becomes law. Gee – I wonder what kind of retaliation they have in mind? I’m confident they expect the US to withdraw from the agreement. The rest of the countries probably won’t. But as I mentioned in a previous post, Iran will now feel justified in unleashing some kind of cyber attack on us. Will it be the banks? Nah – they already did that. Infrastructure? Probably aren’t ready for that. I suspect that with their buddy Putin’s help, they’ll hack some more sensitive documents out of D.C. Or maybe the RNC. Sort of akin to having a pet rattlesnake. Russia will pretend they had nothing to do with it, and Iran will take credit. Gonna get interesting…hugely.

OK, back to economics. The stock market reached a new high of over 19,000, with emphasis on small cap stocks and the Dow, versus the Nasdaq. This indicates a business expectation that infrastructure spending will lift small companies and heavy industry, but not so much on the tech side. That’s all well and good, and not totally unexpected. But what is noteworthy is what is happening to the bond market. This will take some ‘splainin’, so I’ll go slow and break this down a piece at a time.

Within days of DtheT being declared the winner in the race for the worst job in the world, the interest paid on a ten year government bond jumped a full percent. This is fairly extraordinary, and surprised some people. What made it jump? Because people are selling off their bonds. Why? Because when people sell bonds, the price goes down. Lots of sellers means the price goes down a lot. When the price goes down, what happens to the interest rate for the bond, referred to as the yield? It goes up. So yields going up in the bond market means lots of folks are selling these treasuries off. Why? In normal times, a sell off is an indicator of confidence in the market. People buy government bonds as a safe haven in times of trouble – at least you keep your principal, even if you don’t earn much interest. So is that what’s happening here? Well, as I indicated above, enthusiasm for DtheT’s policies is driving the stock market up. But the rationale for selling bonds may be another indicator.

It is a fact that since 2008 and the Great Recession, interest rates have been extraordinarily low. As a result, people all over the world have been borrowing money. In dollars. Lots and lots of dollars. In the trillions. A lot of that money is in cash, but a lot of it bought stuff. And when a lot of dollars buy a lot of stuff, the price of that stuff goes up. Feeling wealthier, folks borrow more. Is this starting to sound familiar? It should: it was a major reason for the big crash in ’08. But that’s not what I’m here to talk about.

All those borrowed dollars have to be repaid. And with DtheT threatening sanctions on China, higher tariffs on imports and a trillion dollar infrastructure plan, what are those three things likely to produce? Inflation. What happens when we have inflation above a reasonable level? Interest rates go up. Interest rates going up means more investors coming to America for those higher yields. That leads to even higher inflation (say it with me: inflation is too many dollars chasing too few goods. Thank you!) Inflation means the Fed will raise interest rates more. Gets to be a bit of a habit, eh?

But what about all those foreigners with debts denominated in dollars? They get paid in zlotys, euros, Turkish lira and Hyvrnias (Ukraine’s currency). A stronger dollar means weaker zlotys, euros, Turkish lira and Hyvrnias. That means those foreigners’ lending costs go up, even if they don’t borrow another dime. So maybe that bond selloff isn’t a sign of confidence – it’s a sign of preparing for bigger bills coming due in the not-too-distant future, and they want to have dollars available to repay those loans.

So what’s my conclusion? People around the world are taking DtheT at his word that he is going to do what he said he was going to do during the campaign. Apparently, folks think Congress will just roll over and play along, unconcerned about increasing the deficit. Won’t that be a big fat kick in the ass? So much for those cuts from “sequestration”. They were never really serious, were they? Time will tell.

More on the topic I introduced yesterday. I’ve been reading about the Stuxnet attack on the centrifuges at the Natanz nuclear facility in Iran. There’s also Alex Gibney’s documentary Zero Days – available on Showtime. Now that I more fully understand what David Sanger of The New York Times has been talking with Charlie Rose about over the past few years, it gives me pause to wonder. Why would Iran, essentially attacked cybernetically by the US, agree to the Nuclear Deal with the Obama Administration?

Some think Iran gave up its nuclear ambitions early in the new millennial decade, and the to-do over nuclear development was more for home grown consumption – to enrich members of The Revolutionary Guard and keep nationalist fervor at a peak. I suppose that’s possible. But when Ahmadinejad went too far in provoking the Israelis, is it possible they were convinced Israel would attack and destroy the nuclear sites that may or may not have been operating? Or did the deal with Obama just buy them time? Or maybe some or all of the above is true?

One thing of which I’m sure: there will be consequences for Stuxnet. Think Libya’s Lockerbee bombing in retaliation for Reagan’s attack on Gaddafi’s home that killed his stepchild. The Reagan attack was retaliation for a Berlin discotheque bombing carried out by Libyan nationals. Osama and Al Qaeda were responsible for various bombings in retaliation for US troops’ presence in Saudi Arabia. These bombings included the embassies in Kenya and Tanzania, the Khobar Towers in Saudi Arabia (although Iran and Hezbollah were blamed as cover for our relationship with the Saudis) and, of course, the Twin Towers. So the bottom line here is that revenge is baked into the DNA of the residents of the Middle East. I’m highly dubious they will turn the other cheek after what we and Israel have done to them – and likely continue to do to them – with cyberwarfare.

I expect they now have turned their attention and resources from nuclear to cyber. I fully expect to see them retaliate in an oh so big way – within this decade. And when they do, you’d best be prepared…you know, the chickens – the garden…but also a full house generator run by a separate LP gas tank. Yes, as soon as we have the resources, I intend to invest in such an outfit.

And what will our new administration do about all this? First, they will likely withdraw from the agreement with Iran, and Congress will vote to re-introduce sanctions. But what about the rest of the countries party to the agreement – UK, France, Russia and China – where will they be on this? My best guess is they’ll want to leave it alone. There’s nothing in it for them to revisit the agreement. This is particularly true in light of the fact that Iran – possibly allied with Russia and/or China – will go after us. And with the trade sanctions imposed by DtheT on China, and Putin having a new, best buddy in the White House – China will have justification and Russia will be emboldened to do so. The eyes of the rest of the world will be averted. We will get our comeuppance. Bigly. Ouch.

Looking back over several hundred years’ of so-called civilized existence – both in the United States and the world at large – I’m beginning to wonder if the oft-quoted Clinton campaign line about the economy is really true. I’d argue that, contrary to times past and because of globalization, economics is no longer a zero sum game, where if America wins, by definition China must lose, or vice versa. We appear to all be in this soup together. I’d further argue, based on that same review of time, there is an inverse correlation between economics and warfare, at least on a large scale and maybe even on a small scale. So rather than advocate for things to do (or not), to improve the US economy, I’m tempted to stick to my previous thesis. And what is that? That within the next decade or so, the world will – once again – be engulfed in a war of global proportion. And the very act of going to war will be the creator of an economic boom during the war, and afterward for the victor(s) – and depending on which side wins, maybe for the losers too.

But, you argue, how can that be? It is settled dogma that with the advent of nuclear weapons, global war is impossible. Maybe it’s difficult, if not impossible to visualize, but that doesn’t make it impossible to happen. So let’s talk about these two points separately. First: my point that we’re in the soup together. Second: that some or all of us will forget that reality, and try to take from others to enhance ‘us’.

We’re in the soup together. In 1985, the balance of trade (imports minus exports) between the US and China was nearly zero. In every year since then, Chinese imports to the US have exceeded our exports. Our exports have grown arithmetically; imports have grown, if not exponentially then definitely logarithmically. In 2015, we imported $4 worth of Chinese goods for every $1 worth of goods we sold them. So the US is a critical trading partner for China. How critical? The US is China’s number 1 trading partner. It’s number 2 partner is Hong Kong, which is a little bit like trading with itself, geographically speaking. Number 3 is Japan, but the total amount exported is one quarter of its exports to the US. What do we buy from China? Electical equipment and power generation equipment are #1 and 2, respectively. Then it’s stuff you’d expect: toys & games, furniture, clothing and shoes.

So, you say? What’s your point? Let’s say DtheT follows through with his campaign promises regarding China. And what were those promises? Oh, OK – force me to repeat them. He said he’d label China a currency manipulator, and place sanctions on them. Yes, he can do that unilaterally as a result of the Trade Act of 1974. That would undoubtedly trigger retaliation from China, at a time when it’s already more difficult to do business there. Why is that? Because China wants to sell stuff to itself, virtually eliminating the imports they require now. The government is heaviy subsidizing Chinese industries that will manufacture most of what they import from the US. DtheT will aid and abet them in this pursuit. In addition, by putting tariffs on Chinese goods and making them more expensive, consumers in the US will pay more. And the effect? There will be a hit on the cost of living in the US. Who will be most affected? Those same people that voted for him…farmers that export agricultural products to China, the Boeing company’s workers that make airplanes that China will instead buy from Airbus. So effectively, we are in this soup together. DtheT can’t hurt them without sacrificing us. Awesome. Breaking for lunch – be back in a few.

So now on to this war thing.

That was a longer-than-expected break – the internet was down all afternoon. Comcast just can’t seem to keep things running out here.

So this war thing. The number one cause of modern warfare is ideological change. Really – look it up. And you certainly have to admit we’re about to have a sea change in ideology in this country. Oh, and when people around the globe were polled and asked, “What is the greatest threat to world peace?” The majority of people answered The United States of America. How ’bout them apples? So we have an ideological change and a man in charge who’s thin skinned and ready to make radical change. Does that not sow the seeds of potential conflict with some of the major players around the globe? You betcha…but whose side will we be on? Will we be the “good” guys? Doubtful..not with friends like Vlad the Impaler and Bashar Al Assad. We will continue to frighten the bejesus out of most of the occupants of the civilized – and not so civilized world.

So how will this thing start? Geez, you really want more specifics, eh? My best guess continues to be the Middle East, primarily because most of the misery in the world seems to live there. Aleppo is about to fall back into the hands of the ‘government’ of Syria, such as it is. So what then? Assad will preside over a country at least half of which has been destroyed by war. Who’s going to help him pay to rebuild it? Will the nearly 4 million refugees return, or will they continue to try to make new lives elsewhere? And which elsewhere? Those opportunities are quickly drying up with nationalism and anti-Muslim sentiment spreading like wildfire across the globe. These facts all look to me like a repeat of the 1930’s, with major upheavals caused by nationalism and ideology. The US will soon be exporting these instead of wheat, corn and airplanes. Time to hunker down. Pay off debts, plant a garden and get some chickens. It’s my strategy, and I’m stickin’ to it.

Let’s start with what I do not intend to discuss: trying to figure out what DtheT will do. As he doesn’t know, how should I? So let’s dispense with all the second-guessing right now. Besides, he is, frankly, irrelevant.

So what I intend to discuss over the next few weeks are what policies should be: economically, domestically and with respect to foreign affairs. Then maybe DtheT will channel that info like Barry did relative to Cuba and other, key topics which he riffed on – right after I did. Coincidence? Hmm…

So the next post will concern itself with things economic. Prepare yourselves!