Since our last Investment Update, we have seen numerous macro-economic events roil the stock markets, possibly ending the post-election market bounce fostered by # 45's economic rhetoric. Most of the recent market decline was blatantly political in nature.
First, we saw the predictable failure of the ObamaCare "repeal and replace" vote, giving credence to a future new book titled "The Art of the Scam" or even "The Art of the Blame Game."
Second, we saw the US Justice Department (under the FBI's Special Prosecutor Robert Mueller) go after # 45's ex-top advisor and alleged Russian mole Paul Manafort with an early morning raid on one of Manafort's mansions one day after his testimony to a Grand Jury. Mueller is investigating # 45's alleged Russian money family profiteering and the obstruction of justice surrounding Vladimir Putin's proven US election hacking.
Third, last week, almost 70 years to the day we dropped our first hydrogen bomb on Japan at the end of WW2, we saw our own modern day "Fat Man and Little Boy" megalomaniacs threaten each other with nukes. Fortunately there were some adults in the White House and in North Korea.
As a result of these obvious conflicts of interests and incompetencies, Wall Street is now more sceptical about the future of the US economy and is starting to see # 45's economic hustle for what it was to anyone who wanted to hear it: A SCAM!
"Make America White Again"
And then this past weekend we witnessed a sickening white supremacy domestic terrorist attack in Virginia, where the racist hate monger and ex-KKK leader David Duke was quoted as saying Donald Trump presidency was the impetus for the white supremacy rally in Virginia (said before the terror attack):
“This (rally) represents a turning point for the people of this country. We are determined to take our country back. We are going to fulfill the promises of Donald Trump. That’s what we believed in, that’s why we voted for Donald Trump. Because he said he’s going to take our country back. That’s what we gotta do.”
Not to be outsleazed, on Sunday we also heard from the disturbed publisher of the US neo-Nazi publication The Daily Stormer who praised Donald Trump's response to the white supremacy violence. Andrew Anglin, the hate website’s mentally deranged founder, clearly appreciated Trump's dog whistle response to the terror attack:
“He didn’t attack us. He just said the nation should come together. Nothing specific against us. No condemnation at all. When asked to condemn, he just walked out of the room. Really, really good. God bless him!"
So now that we have seen another domestic white supremacy terror attack, has America finally got a meaningful wake-up call regarding the race baiting inside a contingent of the current Republican Party and more directly from Trump and the inner circle in his White House (aka Steve Bannon, Stephen Miller, and Sebastian Gorka).
On the surface, this past weekend's white supremacy terrorist attack was the result of the insane cultural obsession with the evil legacy of American slave ownership - and now the long needed removal of antiquated 1920s Jim Crow appeasement statues of the American traitors Robert E. Lee and Jefferson Davis (both also war criminals, as they refused to swap black Union prisoners for Confederate prisoners - and had them murdered instead).
In my view, if this slavery obsession is still so valued in America 150 years after the morally necessary defeat of the treasonous Confederacy, then General William Tecumseh Sherman's 1861 march to Florida was clearly not harsh enough!
Btw, "Alt-Right" means white supremacy, not some new, innocent political movement or information network. "Alt-Right" means bigotry, plain and simple, and they are certainly a part of Trump's core base.
Regarding Our Fidelity Investments:
Since our last Market Update, in most of our Fidelity accounts we reduced our stock market exposure by 15% to around a 75% invested allocation. All the aforementioned sell and buy transactions occurred before the market selloffs surrounding last week's North Korea imbroglio.
We now have about 25% in money market cash.
An Investment Turning Point
This week will tell us whether we are going to see more selling or whether a temporary resolution to the North Korea situation will provide us with a stock market bounce on Monday.
Looking at the futures markets, it looks like Monday will give us at least a one day stock market rebound. But if we see more selling beyond Monday, we will most likely continue liquidating our weakest stock funds and take new defensive positions in 1) Gold and 2) 20 Year Treasury Bonds.
On the other hand, if we see a longer market rebound, we are likely to take a new fund position, probably in the Biotechnology sector.
Please contact me if you have any questions or concerns about your Fidelity portfolios. Be wise; be safe.
"We all do better when we all do better" - Paul Wellstone