On Friday, the S&P closed at 2259 and change while the Dow surged to 19,756.  Meanwhile the NASDAQ voted its optimism for stocks as well.  But what does this mean?  What is Mr. Market trying to tell us?

Trump is viewed as a builder, whether it’s a tower or a business.  He constructs.  The Left deconstructs.  The Left does not build, it is not market driven.  Its why moments after Trump was elected the bond market sank considerably and rates modestly reflected that upward.

What is the bond market, besides junk bonds or business issued debt?  When we say ‘bonds’ we are primarily concerning ourselves with the debt market and specifically government debt, ie Treasuries.  Government debt, or the continuing ‘investment’ in government, the expansion of government which eventually destroys markets, had peaked in Obama’s presidency.   The Street was now placing its red chips against the House money, the Fed, and moving them across the green felt table, nearest free market enterprise and voluntary business exchange.  At least that’s what the theory behind all this is.

It is a vote against the coercive use of misplaced force in favor or humans wanting to finally be left alone to pick and choose what they want to do instead of throwing more money into negative yields.  Isn’t that what government yields anyway?  Not just a zero return, but for the first time in history, a negative return on capital for a belief in an IOU that would never materialize.  Its why China’s been on a divestment tear out of and away from US Treasury backed securities seeing the Bush/Obama clown car balloon ready to pop into worthless confetti.  Pssssst... a little hint to our leftist friends, government doesn’t create anything.  They have no earnings, only takings.

Bonds are dead money and have been for as long as we’ve been jellin with Yellen.  They weren’t much better under Bernanke except that our Fed was encouraging the idiocy by being the federal government’s bag man.  It may be a bit crude to say, but the Bush/Obama duopoly had the (mis)fortune of a no longer independent Federal Reserve which acted, for the first time in US history, as the reservoir tip, the condom if you will, for reckless fiscal spending. 

Debt is a catchy disease.  It is caused by the moral filth of an unaccountable federal government.  We see it too at the municipal level also with Stockton, San Bernardino and Detroit and more corrupt cities to come I am sure.  We see it with public teachers, cops and fire fighters with out of control pensions attached like various deer ticks to all of our property taxes because we all know a public employee's feet needs to hit a sandy retirement first before anyone else's in the private sector by at least 15 years.  Debt.  Obama was primarily a moral disaster in this regard, more than any other, and that abetted by a federal reserve that allowed him not to have to make the hard changes needed for a stable society and currency.  Debt, by definition, destabilizes.  This trend has had to reverse at some point.  It was always inevitable.

It's not to say we are out of the woods yet.  Trump will have to execute correctly on Wall Street’s presumptive premonitions, and that’s all they are at this point.  But here’s to the first prick of the government bubble and the bond bloodbath that’s to follow if Trump can get America moving again and create jobs.  That only occurs, at least the real ones, in the private sector.