The Stock Market’s “Trump Bump” Is Over | Markets Are Dumb 2

With we go all in on discussing the US stock market. There’s this idea that stock markets are somehow rational, or serious. People who talk about it are always wearing suits, and we put a lot of effort into making all the details of interest rates, portfolio management, and valuations seem boring. The stock market is none of these things. In fact it’s nuts. By going through the history of the “Trump Bump”, I attempt to draw the curtain back a bit.

Unfortunately, watching the video, I think I screwed something up. It’s not that the story I put forward is wrong, it’s just that I left too much out. The video falls into the “Presidents impact everything” school of commentary. I hate that school. The differing views market makers took of Trump and Obama are tremendously important to this particular economic story, but that doesn’t mean that presidents are actually all that powerful. I really don’t want to create that impression, and I apologize if I did so with .

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What’s an Economy? | Markets Are Dumb 1


I feel like markets and economics have been an underpinning of what I’ve been talking about for quite some time now. It’s been a troubling thing for me. There’s always a lot of certainty when these issues come up in political discussions, but usually almost nothing backing up that certainty. The conditions we’re looking at are always changing, and the theories that people gravitate to are some of the least proven imaginable. Economics has pretensions to being a science. But the variables are immense, and there’s really only one result.

We have one world economy, and its performance at any given time is the only thing that we have to point to, to see whether our theories are working. There is no control group. Most of the figures we rely on to measure what’s going on are little better than rough estimates, and the political consensus rarely lasts a decade. I have high hopes for the profession of economics. People are doing amazing work in the field, and the move onto the internet that our species is currently undergoing provides the possibility of real measurement (and Orwellian nightmares). I’m confident that the future is bright, but I think we all need a lot more humility in talking about the economy. Which is why I made , and why I’ll be adding to in the coming weeks…

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Democracy Is NOT Dying

does a good job of laying out how ridiculous the “Democracy is Dying!!!” story is. But what it doesn’t do is lay out why the story gets so much play. The sad fact is that it’s useful to powerful people in the United States. Once again, it all comes back to the . The wise men of the Pentagon have realized that “Terrorism” is losing its power as a motivating factor. Despite the best efforts of Trump & Co. it’s obvious that general white loser angst has had a much higher body count in the US over the past decade than “Radical Islamic Terrorism”. So we need something else to be scared of to justify our absurd military budgets. That’s why this narrative gets so much play.

The idea is that if “Democracy is Dying”, the world really is “more dangerous than it ever has been” as the Pentagon keeps telling us. I may do a video on this in the coming weeks… I’d be interested to know how much relevance this story has beyond the national security nerd twitter bubbles I frequent. In those circles this “Democracy is Dying” story has become the conventional wisdom. Is that the sense you get where you are at as well? Let me know in the comments.

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Video Transcript after the jump…

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