Last night Netflix reported blow-out numbers and the stock is up over 5% this morning. That’s a nice pop for one of my recommendations — it’s listed in the right hand column (on my web site) of ” STOCKS, ETFS AND FUNDS WE LIKE & OWN?” ? Others of my recommendations have done well recently — including Amazon, Flex, HD, DISH, HON, DIS, SQ and CENT.
Tomorrow Donald J. Trump becomes the 45th president of the United States. I didn’t vote for him. But I accept we live in a democracy. And tomorrow we will have a new leader with new ideas. I also am aware that we know of him (so far) has come from speeches and interviews he gave to get elected — as marketing tool tool to win voters. “Lock her up” worked. Demeaned his opponent. As “action” it’s dead. Served its purpose. Now irrelevant. What he said as candidate and what he’ll do as President are likely to be very different.
The wall? NAFTA? Obamacare?
What we know is what motivates Mr. Trump. It’s to be the best American president ever. Do right by the people and their economy. More stuff will be dropped. Different stuff will be adopted. The man is practical, pragmatic and risk-taking. He will blaze paths that the “experts” predict will lead to disaster. Some will led to disaster. Some won’t. Many will led to successes beyond our wildest imagination (and beyond his wildest imagination). The next four years will be exciting and bumpy.
I remain optimistic. I will continue to expand my public and private investments, demonstrating my faith in the American economy. And I urge my readers to stay invested.
I found two recent articles on Mr. Trump that I find most useful to figuring what might happen. The first is from the conservative Wall Street Journal, and the second is from the liberal New Yorker. Read them both. They tell a nuanced story of Mr. Trump.
First, the Wall Street Journal, from Greg Valliere, who is the Washington-based chief global strategist with Horizon Investments.
10 Things We’ve Learned About Donald Trump
Donald J. Trump likes surprises and can’t be pigeon-holed; he’ll be the most unique president in American history. Like everyone in our industry, we’re trying to get a handle on the president-elect. After talking with sources, here are ten key observations:
1. He’s incredibly detail-oriented: This is quite a surprise. Trump doesn’t delegate well; he’s planning virtually every detail of the Inauguration, and he’s getting into the weeds on legislation. He understands the incredibly complicated “border adjustability” tax provisions, which only hard-core wonks fully grasp.
2. Trump has no great affinity – or loyalty – to the GOP leadership: Trump will never have warm relations with Paul Ryan, and he has no reluctance to blindside his own party. Senate Republicans are still dumbfounded by Trump’s assertion that universal health insurance will pass quickly. They weren’t consulted — and they’d better get used to that.
3. Surprise!! Trump doesn’t like a strong dollar: The financial markets were stunned yesterday by Trump’s declaration that the dollar is too strong; no president — or Treasury Secretary – has ever waded explicitly into currency policy. If Trump really believes in a weaker dollar, that’s a very big deal.
4. He’s deadly serious about tariffs: For decades, Trump has asserted that the U.S. was getting ripped off by trading partners. He will not be dissuaded on this issue; he’s adamant that the U.S. has been fleeced by countries like China. Trump will talk tough, hoping for concessions, but he’s fully prepared to raise tariffs and pull out of trade deals.
5. He listens to Pence and Priebus: Maybe it’s wishful thinking, but Congressional Republicans we talk with are convinced that Trump’s rough edges will get smoothed over by Mike Pence and Reince Priebus, who are essentially pragmatists. “Trump likes to sound like a provocateur, but at the end of the day, Pence and Priebus will run policy,” says one insider.
6. Impulse control issues: This is a great worry, even in his inner circle. Trump’s remarks often are aimed at his adoring base, so he has no reluctance to differ with his Cabinet nominees on NATO, climate change, deficit spending, etc. He also has a vengeful streak and can be easily provoked — as North Korea and Iran surely must realize.
7. The tweets will continue: Get used to this; everyone we talk with is convinced that no one will take Trump’s Twitter away; he’s a huge fan of this new bully pulpit. The first thing we do, very early in the morning, is check what Trump tweeted overnight, because obviously he can move stocks and markets.
8. His bark is worse than his bite: One day Trump blasts the press, the next day he’s complimenting the New York Times. He’s a genius at generating publicity, he masterfully manipulated the press in 2015. He starts negotiations with something outrageous (it’s in his DNA), then he looks for a deal. After the election, he essentially said many of his broadsides — such as locking up Hillary Clinton — were just theater.
9. He has a vision: Ronald Reagan had three major goals — diminish the clout of the Soviet Union, reduce the role of government, and lower taxes. That was basically it. Same with Trump – he wants to make the country more secure, he wants to reduce taxes and regulations, and he wants to reverse the economic malaise in the Rust Belt. Trump does have a vision; his opponent, Hillary Clinton, did not.
10. Trump has blind spots: Everyone we talk with proclaims that Trump doesn’t care about the deficit; he’s remarkably comfortable with the concept of debt. He’s tone-deaf on race and many social issues. And he has no reluctance to meddle in the private sector, intimidating companies that displease him.
BOTTOM LINE: Our main focus is whether Trump is good for the markets and the economy — we still think the answer is yes — but he’s a novice in a brand new arena, with little margin for error. The great presidents, and even the good ones, had the ability to grow on the job, so here’s hoping that Trump will as well.
Next the New Yorker magazine article by David Owen
CULTURE DESK
LESSONS FROM PLAYING GOLF WITH TRUMP
Donald Trump at his golf course in Aberdeenshire, Scotland, in 2012.
Five years ago, I spent most of a day with Donald Trump, at one of the many golf courses he owns, in West Palm Beach, Florida. (The names of Trump’s courses all begin with “Trump,” so to keep them straight you have to refer to them by location.) At the time, Trump wasn’t even a joke Presidential candidate, so there was no ominous music playing in the background, foreshadowing the tragedy to come. I was working on an article about him for Golf Digest, and the main focus was a course of his that was about to open on the east coast of Scotland, near Aberdeen. Trump owns or manages seventeen courses, including two in Scotland, one in Ireland, and one in the Bronx, and most of them are highly regarded-and not only by him. They also appear to be more successful, as businesses and investments, than many of his other businesses and investments, especially the casinos and his so-called university.
The reason for this may be that golf is a subject Trump actually knows something about. He’s a good player, and, even without adjusting for his age, he’s probably the best of the many golfers who have been President of the United States. His closest rival, according to a ranking that Golf Digest put together several years ago, would have been John F. Kennedy, who not only looked and dressed the part but also played quite well, despite his horrendous back problems. No other President would have had much of a chance in a match against him-including Dwight D. Eisenhower, who was the most avid golfer ever to be President, and whom Golf Digest ranked just behind J.F.K. (Eisenhower had a practice green built on the White House lawn and left spike marks on the floor of the Oval Office, but he had putting issues and a bum knee; during his second Presidential campaign, there was a bumper sticker that said, “Ben Hogan for President. If We’re Going to Have a Golfer, Let’s Have a Good One.”) Back in 2012, Mitt Romney promised that, if elected, he would not play golf while in office, unlike that slacker Barack Obama, but George W. Bush (No. 6 among golf-playing Presidents, one spot below his father) defended Obama. Eisenhower would have defended him, too. He believed that Presidents, especially, need access to forms of recreation that provide temporary sanctuary from the extraordinary pressures of the office, and golf is certainly one of those. In fact, if Trump could be persuaded to spend his entire term playing golf, we might all be better off.
“So, I do it for fun,” Trump told me over lunch, as we discussed his courses. “It’s become a very successful business, because of the level of quality. When other clubs are empty, everybody wants to join here. And by `here’ I mean all of my clubs. Every one of them works, and works really well.” Trump’s main topics are money and himself-maybe his only topics. (He described the club’s location to me as “the richest place anywhere on the planet, in terms of, you know, wealth.”) “I turn down ten for every one I buy,” he said. “I will buy one only if it has the potential to be the best. I’m not interested in having a nine.” He flipped through a pile of photographs of his courses. “This is Bedminster, New Jersey-one of the richest places in the country. . . . This is a better course than Pine Valley, and the Pine Valley people say that. Two of them came over to me and said, `Mr. Trump, this is better than Pine Valley, but please don’t ever quote me.’ . . . This one blows away Congressional like nobody ever blew it away. They say it’s not even a contest. . . . This is the most incredible piece of land in the country, right here. . . . This is ten minutes from the Beverly Hills Hotel. . . . There is no place like this. People that truly cannot stand Donald Trump are saying it’s the greatest course ever built.”
After lunch, Trump and I played eighteen holes, accompanied by a bodyguard and John Nieporte, the club’s head professional. A friend asked me later whether Trump wasn’t “in on the joke” of his public persona, and I said that, as far as I could tell, the Trump we were used to seeing on television was the honest-to-god authentic Trump: a ten-year-old boy who, for unknown reasons, had been given a real airplane and a billion dollars. In other words, a fun guy to hang around with. As Tiger Woods observed recently, after also playing golf with him, Trump hits the ball a long way for a seventy-year-old. (He certainly outdrove me.) He’s also a good ball-striker and a terrific putter, despite employing a putting technique that, Nieporte told me, is so idiosyncratic that he wouldn’t dare either to change it or to teach it to anyone else. At the end of the round, Trump and I posed together for a photograph in front of the signature design feature of several of his courses: an enormous man-made waterfall, the outdoor equivalent of the huge fake-gold chandeliers and “French” furniture that he also has a weakness for.
Golf publications periodically rate golf courses-the hundred best in the world, the hundred best in the country, the dozen best in each state-and Trump’s relationship with such ratings is complex. He complained to me that golf publications never rank his courses high enough, because the people who do the rating hold a grudge against him, but he also said that he never allows raters to play his courses, because they would just get in the way of the members. “I think we’d have a revolt with our membership,” he explained. “Because, unlike other clubs, every one of my membership lists is perfect. And when you start adding hundreds of raters who want to play golf . . .” Nevertheless, when someone from a golf publication does write something positive, after somehow having managed to slip past the perimeter, Trump quotes it endlessly (and, inevitably, magnifies it).
In my own article, I did write nice things about Trump’s courses. But Trump, nevertheless, was upset. He called the editor of Golf Digest to complain, and then he called me, on my cell phone. I was in the city on a reporting assignment unrelated to golf, and had the surreal experience of being chewed out by a future President of the United States while standing among the gravestones in the burial ground next to Trinity Church. He wasn’t upset that one of the article’s illustrations had been of a golf ball wearing a turf toupee that looked a lot like his deeply mysterious hair, or that I’d mentioned his asking two little girls at Mar-a-Lago if they wanted to be supermodels when they grew up, or that I’d described nearly tipping him five dollars after momentarily mistaking him for his club’s parking-lot attendant, or that I’d written that he’d introduced one of his club’s members to me not by name but as “the richest guy in Germany.” He was upset that I hadn’t written that he’d shot 71-a very good golf score, one stroke under par.
I hadn’t written that because he hadn’t shot 71. We hadn’t been playing for score, and we had given each other putts and taken other friendly liberties-as golfers inevitably do when they’re just fooling around. I said something to that effect in the politest way I could think of, but he wasn’t mollified. He was also angry that I’d described his wedge game as “poor.” (On several occasions, he’d had trouble with shots inside a hundred yards, both during our round and on the practice range beforehand.) I reminded him that I had mainly written very flattering things about his golf game, and that I’d mentioned his victories in three club championships and had quoted praise from his caddie and his pro (“You have a very nice bicycle, Donald, even if it’s not as nice as your friend’s”). But none of that made any difference. He wanted the number, and the fact that I hadn’t published the number proved that I was just like all the other biased reporters, who, because we’re all part of the anti-Trump media conspiracy, never give him as much credit as he deserves for being awesome. Such is his now familiar habit of acting like a sore loser even when he’s won.
People sometimes ask me whether Trump cheats at golf. I’ve heard stories that suggest, let’s say, that he takes liberties Bobby Jones would never have taken, but I don’t think “cheating” is an accurate description of anything he did during the round we played together, just as I don’t think “lying” is an accurate description of what he does when he gives a speech or answers questions at a press conference. In Trump’s own mind, I suspect, he really did shoot 71 that day, if not (by now) 69. Trump’s world is a parallel universe in which truth takes many forms, none of them necessarily based on reality. And we’d all better get used to his way of thinking, because for the next four years we’re going to be living in that universe, too.
That’s it. I hope these two articles help your thinking about Trump.
Harry Newton, who’s in the Coachella Valley, California — ostensibly a desert. Yet it rained last night. And it’s going to rain again today. Go figure. This is what it’s meant to look like. Taken a few days ago.