By Gary Wagner
Tuesday December 20, 2016 18:26
The brass ring is certainly within reach as the Dow inches closer to 20,000. US equities continue to gain tremendous value, today coming within 13 points of that elusive number on an intraday basis. Considering that the Standard & Poor’s 500 has gained roughly 6% in value since the presidential election last month, we continue to see new, all-time highs and milestones reached at the quickest pace on record.
The current record of the Dow gaining 1000 points is 35 days, which occurred in 1999. Now, a mere 28 days has transpired since the Dow was at 19,000, and it is certainly on pace to take out the former historical record. In other words, it’s not a matter of if, but when the Dow will trade past 20,000. Currently the Dow is on pace for its best quarter in three years.
This newfound optimism, which began immediately following last month’s presidential election, continues to weigh heavily on precious metals pricing, while boosting US equities and the US dollar.
Looking Past the Obvious Shortcomings
Inasmuch as many analysts, including myself, have spoken about the shortcomings of President-elect Donald Trump, the undeniable fact is that smart money is betting on the success of this new administration and Cabinet.
As far as President-elect Trump’s Cabinet goes, he is surrounding himself with an unprecedented level of wealth that, according to CBS News, is at least 50 times greater than the Cabinet of George W. Bush. According to Forbes Magazine, early estimates of Trump’s Cabinet picks collectively have a net worth in excess of $14 billion.
On the surface, this might look like Trump is selecting foxes to guard the hen house. But, on a deeper level, Trump is selecting extremely well fed foxes to guard our hen house. Not only are these individuals well fed, but by virtue of success, and their accomplishments, have proven to be excellent stewards of their wealth. As such, they are certainly highly qualified to do the same for our country.
The truth is, for far too long political posts have been a doorway or path to the generation of personal wealth. As such, the system inherently attracts those wishing to line their pockets with dollars at the expense of the citizens they are supposed to serve. The system has blurred the line between politicians, special interest groups, and lobbyists. Too often, politicians use their post as a path to a high paying civilian job, based upon favors given during their political tenure.
Brewster’s Millions and Trump’s Billions
In the novelBrewster's Millions, a deceased uncle wishes to teach the value of money to his remaining heir so he will not to squander it. To that end, the uncle makes the inheritance conditional. The heir must spend millions in a short time period, without keeping any assets. The uncle anticipated this would make the heir so sick of spending that the remainder of the fortune would be handled in the proper way.
By selecting extremely successful and extremely wealthy individuals to his Cabinet, President-elect Trump is creating a collective group that might not be motivated by the accumulation of wealth. For most, this is a benchmark they have already reached. President-elect Trump is selecting people that have already proven to be excellent creators and stewards of their wealth.
This means the motivation to use their positions as a self-serving podium is greatly reduced, and more importantly, their proven, increasingly successful track record has provided them with the necessary experience to function at the highest level. These are individuals that not only know how to set goals, but more importantly, know how to reach them.
