Trump, the wall, and Keynes v Friedman. The ultimate battle.

[Max E.]

I really wanted to start a thread that would track what we are witnessing, i honestly believe this is a once in a life time opportunity, Some people will come out of this multi millionaires, and some people will come out of it on the bread line. Im hoping im on the right side.

I honestly believe we are witnessing one of the biggest pivot points in history, (the last hundred years anyways) based on keynes v. Friedman, and 100 years from now ppl will look at what happens within Trumps first (and most likely only) term and think how were people at that time not on the right side of that.

It is the same way i look at the 20's with all the stories and wonder how they didnt see the depression.

I tried starting a thread about Trump trades thinking the craziness he was causing in the market would last, clearly it hasnt.

Stocks and the market (other than EWW, and the Peso) have stopped having the snap reactions they originally had based on Trumps tweets.

EWW crashed a bit today but that took a whole day of the news to push that, along with a mexican president who was dedicated to losing, it wasnt like it was originally where you could interpret a couple words and go pile into a stock.

The other day Frederick Foresight asked me which way i think this whole thing is going, and i responded honestly, I have no fucking clue, this is a new social experiment, the likes of which we have never seen, so far its just been easy money taking advantage of momentum, but that has already started to fade.

So here is the argument on both sides, one side (ironically the liberal side) says that we need free trade in order to keep products cheap so consumers have more purchasing power, the other side (ironically the conservative side) says more money in the pockets of U.S. consumers will drive growth.

Keynes V. Friedman, this is the single most important argument of our time. IMO

Everything is backwards, and very confusing. I think the guys on this site on both side, (except spiketrader) are the smartest guys in the room, id love to hear arguments from both sides.

Any trade ideas would also be a great contribution, not going to lie, for the first time since i started trading I have been unable to sleep just looking at charts, and ideas, still dont have a big picture idea, but i know there is going to be a 7 figure plus trade out there in the next year (something thats always been my goal)

 

[Greenie]

The amazing thing about trump is he is actually living up to his campaign promises.

 

[achilles28]

Yes, we are Max.

I spent the last 12 months high, watching Donald Trump speeches. The world is about to change in a very big fucking way.

Asia built their dirt-floor economies on mercantilism - tariffs and currency debauchment. It simply works. Did tariffs and currency debasement "hurt" the average Chinese worker? Who now earns 20 times what they did 10 years ago? If that's economic "pain", then many Americans would love to have that kind of "pain" inflicted on them....

Globalization enriches the ownership class at the expense of the working class. The extra profits garnered from throwing working class Americans to the wolves, goes straight into the pockets of the top 5% who own stocks. That's it. Globalization creates massive wealth and income disparities. Bernie and Trump said the exact same thing, from two different angles - the ranks of the rich and poor swell, while the middle class disappears.

You're right to be confused. There's much much more going on behind the scenes. Globalists are entrenched. China alone stands to lose 8-10 Trillion over the next 10 years, easily. 1 factory job is worth about 1.5 jobs. Research and development, managerial, construction and real estate, banking and finance, marketing, spin-off consumables (cars, clothes, appliances, homes for workers). It's a big fucking deal and China knows it. That's just China !! Think of all the other countries whom which Trump is about to take meat off their plate. And think of all the social and political fallout in China from taking about 25% of their GDP! Hence the table pounding and tantrums we're seeing around the world from the parasites feasting off America's wealth.

Basically, America provided charity to the world in the form of "globalization" via massive trade deficits. America gave away their jobs. Liberals loved it because they love forced charity and believe in atonement (aka White Guilt). Neocons loved it because they tend to be wealthy, generally are callous people who don't really give a fck about middle America, and enjoy killing Brown people. Trump just destroyed establishment Liberals and Neoconservatives. That's all done now. The old relics of the past have been smashed into a million pieces. That's why I jumped up and down for Trump the past year. I watched this fucking guy. He's the real fucking deal, as we can now all see.


Big trades?

- Trumps going into the Caliphate with Marines, and will take the oil. That's good for a 30-50% pop.

- Yellen and the FED could be a major problem. We have major bullish forces pushing the market higher (stimulus, massive corp/personal tax cuts, massive regulation cut). And we also have storm clouds looming with Yellen, the FED, and FOMC minutes accelerating desire for quick rate hikes. The FED is last arm of the globalists to exert real pain on Trump. This is a game man. Much going on behind the scenes. The globalists may try and crash the economy, easily. This is a real real possibility. If we get through Yellen and rate hikes, Dude, America is so fucking bullish it's not funny.....

- Buy the VIX now and hold for one year. Start with that. That's a double ur money trade. Trading at 5 year lows IIRC

- Russias coming out from sanctions in March. They won't be reapplied. Jimmy Rogers says go long Ruble and Russia. He's right....

- Irans going back under sanctions, shortly. All Trump droned on about first six months of campaign = how shit the Iran deal was. Got tired quickly of him griping about it, tbh. Short Iranian Rial. Short Iranian stock index etc.

- Long US robotics manufacturers. Obvious.

- Short BABA


PS - yes, as it stands now, all the tariff shit got expressed through currency rates. Not individual stocks. Got my ass handed to me on that one, too.

 

[Max E.]

Damn Achilles, thx for the well thought out response enjoyed reading it.

This is the part that has caused confusion for me, cause the one argument is that a rich U.S. consumer will have more money to buy stuff from the emerging markets, so while, blocking trade will inevitably be good for the U.S. worker, it will be bad for the chinese/mexican/indian worker, So it seems like it will be good for the U.S. market but bad for emerging markets. Globalization has obviously hurt U.S. workers.

But here is where the confusion lies, and where this thing gets complicated, if the U.S. consumer is doing better doesnt that mean that emerging markets will do better given the fact they rely on us in order to buy their shit? Thats the keynesian argument, and thats where it gets confusing.

IMO there is no such thing as a free lunch, we learned that with Obamacare, but where it gets confusing is this,

If the U.S. worker has more purchasing power technically it means they are going to buy more foreign shit, so at the same time the chinese and mexican worker will make less based on the U.S. worker making more, it also means the chinese and mexican worker will make more cause we are spending more in mexico and china.

This is the paradox that clouds my mind, and this is the reason i still dont know what to make of it.

The thought in my mind is that a strong U.S. is good for the world, The U.S. is basically the index that drives the rest of the world which are stocks tracking us.

On the one hand There could be massive continuity here, as the U.S. consumer makes more money and thus has more to spend, and thus drives emerging markets up, but the pessimist in me knows there is no such thing as a free lunch, so if the U.S. consumer is doing good how can the emerging markets be doing good.

This is where the confusion lies in this, and this has been the single biggest paradox in my eyes.

Yes, we are Max.


Asia built their dirt-floor economies on mercantilism - tariffs and currency debauchment. It simply works. Did tariffs and currency debasement "hurt" the average Chinese worker? Who now earns 20 times what they did 10 years ago? If that's economic "pain", then many Americans would love to have that kind of "pain" inflicted on them....

Globalization enriches the ownership class at the expense of the working class. The extra profits garnered from throwing working class Americans to the wolves, goes straight into the pockets of the top 5% who own stocks. That's it. Globalization creates massive wealth and income disparities. Bernie and Trump said the exact same thing, from two different angles - the ranks of the rich and poor swell, while the middle class disappears.

 

[wildchild]

Why do you think Trump's Keynesian policies will be any different than Obama's keynesian policies.

I seriously look at some of the things Trump is doing and wonder if Berrnie Sanders won the election.

 

[Max E.]

Btw I like your trades, lots of ppl think BABA is a giant ponzi scheme, i will definately look into these trade ideas, thx for throwing them out, but i just wanted to give you a heads up, whatever you do, dont buy the Vix on a 1 year time frame, its a deteriorating asset that melts over time, and it gets killed when the market goes up, the Vix is designed to take advantage of volatility on a small time frame, but it melts away over time, to give you an example of what i mean here is a chart of UVXY, the leveraged Vix everytime it gets low enough they just do a reverse split. This is only a 1 year chart, UVXY never traded at 1500 dollars, its only ever traded between 5 and 75 but they reverse split it over and over and over as it deteriorates over time, every time it hits 5 bucks so its lost 95% of its value in a year, whatever you do dont buy the Vix with a 1 year time frame, it doesnt melt as bad as the leveraged vix but its the same concept.

Sorry dont mean to call out your idea just felt i had to give you a warning, the only thing i ever do is short the Vix, unless i think that the market has bottomed and its going to rip up but thats only on a 1-2 week time frame.

Big trades?

- Trumps going into the Caliphate with Marines, and will take the oil. That's good for a 30-50% pop.

- Yellen and the FED could be a major problem. We have major bullish forces pushing the market higher (stimulus, massive corp/personal tax cuts, massive regulation cut). And we also have storm clouds looming with Yellen, the FED, and FOMC minutes accelerating desire for quick rate hikes. The FED is last arm of the globalists to exert real pain on Trump. This is a game man. Much going on behind the scenes. The globalists may try and crash the economy, easily. This is a real real possibility. If we get through Yellen and rate hikes, Dude, America is so fucking bullish it's not funny.....

- Buy the VIX now and hold for one year. Start with that. That's a double ur money trade. Trading at 5 year lows IIRC

- Russias coming out from sanctions in March. They won't be reapplied. Jimmy Rogers says go long Ruble and Russia. He's right....

- Irans going back under sanctions, shortly. All Trump droned on about first six months of campaign = how shit the Iran deal was. Got tired quickly of him griping about it, tbh. Short Iranian Rial. Short Iranian stock index etc.

- Long US robotics manufacturers. Obvious.

- Short BABA


PS - yes, as it stands now, all the tariff shit got expressed through currency rates. Not individual stocks. Got my ass handed to me on that one, too.

 

[wildchild]

Any trade ideas would also be a great contribution, not going to lie, for the first time since i started trading I have been unable to sleep just looking at charts, and ideas, still dont have a big picture idea, but i know there is going to be a 7 figure plus trade out there in the next year (something thats always been my goal)

Here is a trading idea. If you don't have a good feel for what the market or the security you are looking to trade is doing, don't trade it. Sometimes the best trade is no trade at all and you should be sitting on the sidelines. Wait for the set up you like then pull the trigger when you are getting the best of it.

 

[wildchild]

Btw I like your trades, lots of ppl think BABA is a giant ponzi scheme, i will definately look into these trade ideas, thx for throwing them out, but i just wanted to give you a heads up, whatever you do, dont buy the Vix on a 1 year time frame, its a deteriorating asset that melts over time, and it gets killed when the market goes up, the Vix is designed to take advantage of volatility on a small time frame, but it melts away over time, to give you an example of what i mean here is a chart of UVXY, the leveraged Vix everytime it gets low enough they just do a reverse split. This is only a 1 year chart, UVXY never traded at 1500 dollars, its only ever traded between 5 and 75 but they reverse split it over and over and over as it deteriorates over time, every time it hits 5 bucks so its lost 95% of its value in a year, whatever you do dont buy the Vix with a 1 year time frame, it doesnt melt as bad as the leveraged vix but its the same concept.

Sorry dont mean to call out your idea just felt i had to give you a warning.


View attachment 170252

MaxiPad whatever you do, don't follow achilles on buy the VIX. First of all, you can buy the VIX. You can buy ETF and ETNs that attempts to mimic the VIX and they are all horrible or you can buy CBOE futures and options on the VIX. These products are all loaded with contango and don't make good investment vehicles. Achilles should know better. I bailed his ass out a few months ago.

 

[Frederick Foresight]

Big trades?

- Trumps going into the Caliphate with Marines, and will take the oil. That's good for a 30-50% pop.

Can't comment on the rest with any conviction, but this one won't happen.

 

[achilles28]

Btw I like your trades, lots of ppl think BABA is a giant ponzi scheme, i will definately look into these trade ideas, thx for throwing them out, but i just wanted to give you a heads up, whatever you do, dont buy the Vix on a 1 year time frame, its a deteriorating asset that melts over time, and it gets killed when the market goes up, the Vix is designed to take advantage of volatility on a small time frame, but it melts away over time, to give you an example of what i mean here is a chart of UVXY, the leveraged Vix everytime it gets low enough they just do a reverse split. This is only a 1 year chart, UVXY never traded at 1500 dollars, its only ever traded between 5 and 75 but they reverse split it over and over and over as it deteriorates over time, every time it hits 5 bucks so its lost 95% of its value in a year, whatever you do dont buy the Vix with a 1 year time frame, it doesnt melt as bad as the leveraged vix but its the same concept.

Sorry dont mean to call out your idea just felt i had to give you a warning, the only thing i ever do is short the Vix, unless i think that the market has bottomed and its going to rip up but thats only on a 1-2 week time frame.


View attachment 170252

MaxiPad whatever you do, don't follow achilles on buy the VIX. First of all, you can buy the VIX. You can buy ETF and ETNs that attempts to mimic the VIX and they are all horrible or you can buy CBOE futures and options on the VIX. These products are all loaded with contango and don't make good investment vehicles. Achilles should know better. I bailed his ass out a few months ago.

Thanks, Guys. I appreciate the feedback. Constructive criticism always welcome !!!!

Yes, you're right. VIX options, and all products that follow exhibit high theta decay. WC schooled my ass a few months ago on it lol

I retract my VIX call......