White House debates economic stimulus plans

Excerpt from Politico

By BEN WHITE
09/12/2019

MORE FED BASHING — It’s old hat by now. But Trump went hard after the central bank again on Wednesday, calling Chair Jay Powell and his colleagues “Boneheads” for not cutting rates to zero or below. Interest rates, of course, are not the problem with the economy. And negative rates have not done much good elsewhere. They would also deplete the Fed’s recession-fighting toolkit for no good reason.

Cumberland’s David Kotok emails: “Zero and then negative interest rates have created a monstrosity in Europe. It worsens daily. Trump’s call for Americans to follow Europe into this quagmire would harm every saver, every insurance company, every bank in America. No wonder his approval is falling off a cliff. Trumpanomics of Fed bashing and trade war are an economic menace to the United States.”

Read the full story at POLITICO.com .


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Trump: ‘Boneheads’ at the Fed Should Drop Interest Rates to Zero, or Lower

Excerpt from The Fiscal Times

By Michael Rainey
09/11/2019

President Trump blasted the “boneheads” at the Federal Reserve Wednesday for failing to reduce interest rates to zero or below.

“The Federal Reserve should get our interest rates down to ZERO, or less, and we should then start to refinance our debt. INTEREST COST COULD BE BROUGHT WAY DOWN, while at the same time substantially lengthening the term,” Trump tweeted.

Trump framed the issue in part as a matter of competition with other advanced economies. “We have the great currency, power, and balance sheet … The USA should always be paying the the [SIC] lowest rate. No Inflation! It is only the naïveté of Jay Powell and the Federal Reserve that doesn’t allow us to do what other countries are already doing. A once in a lifetime opportunity that we are missing because of “Boneheads,” he wrote. But many economists say the negative interest rate policies in Europe and Japan are nothing to envy, and are likely harmful in the long run.

David Kotok of Cumberland Advisors said that “zero and then negative interest rates have created a monstrosity in Europe,” Politico reported, and Kotok warned that Trump’s desire “to follow Europe into this quagmire would harm every saver, every insurance company, every bank.” Along the same lines, Deutsche Bank CEO Christian Sewing said last month, “In the long run, negative rates ruin the financial system.”

Read the full story at The Fiscal Times & Yahoo News .


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Trashing Fed ‘Boneheads,’ Trump calls for central bank to cut interest rates to ‘ZERO’

Excerpt from Politico

By QUINT FORGEY
09/11/2019

President Donald Trump on Wednesday called on the Federal Reserve to slash U.S. interest rates “down to ZERO,” admonishing chairman Jerome Powell and other leaders of the U.S. central bank as “Boneheads.”

“The Federal Reserve should get our interest rates down to ZERO, or less, and we should then start to refinance our debt,” Trump tweeted. “INTEREST COST COULD BE BROUGHT WAY DOWN, while at the same time substantially lengthening the term. We have the great currency, power, and balance sheet.”

David Kotok, chief investment officer at Cumberland Advisors, said that “zero and then negative interest rates have created a monstrosity in Europe,” and warned Trump’s demand “to follow Europe into this quagmire would harm every saver, every insurance company, every bank” in the U.S.

“Trumpanomics of Fed bashing and trade war are an economic menace to the United States,” he added.

Read the full story at POLITICO.com .


Links to other websites or electronic media controlled or offered by Third-Parties (non-affiliates of Cumberland Advisors) are provided only as a reference and courtesy to our users. Cumberland Advisors has no control over such websites, does not recommend or endorse any opinions, ideas, products, information, or content of such sites, and makes no warranties as to the accuracy, completeness, reliability or suitability of their content. Cumberland Advisors hereby disclaims liability for any information, materials, products or services posted or offered at any of the Third-Party websites. The Third-Party may have a privacy and/or security policy different from that of Cumberland Advisors. Therefore, please refer to the specific privacy and security policies of the Third-Party when accessing their websites.

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Are We Near a Recession? The Godfather of the Inverted Yield Curve Says It’s ‘Code Red’

Are We Near a Recession? The Godfather of the Inverted Yield Curve Says It’s ‘Code Red’

By Lucinda Shen
September 9, 2019

Excerpt below…

Cumberland-Advisors-David-Kotok-In-The-News

Is the U.S. nearing a recession?

It’s the multi-trillion dollar question on the minds of executives and investors around the world. The inverted yield curve, a key predictor for financial downturns, has appeared in recent months at a time when international markets have soured.

Yet U.S. stock markets are still near their all-time high while U.S. retail sales appear upbeat. So some are arguing the yield curve inversion that has predicted each of the last seven downturns, is mistaken this time around.

Another point about the curve’s limited usability: An inverted yield curve doesn’t exactly predict when a recession is coming. In the past, it has typically taken between 12 months to 18 months for a recession to materialize.

“This does not look like an economy that is rolling over. Nor is it,” wrote David R. Kotok, CIO of Cumberland Advisors in a recent note. “Economic slowdowns are far from synchronous with inversions. Growth continued for a year and a half after the yield curve inverted in 2006.”

Read the full article at Fortune.com: https://fortune.com/2019/09/09/recession-stock-inverted-yield-curve-market-great-what-is-economy-us/

 


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Bloomberg-Interactive Brokers Studio hosts David Kotok on Markets and Investing (Radio)

Why we bought stocks before Labor Day weekend

David R. Kotok, Chief Investment Officer/Co-Founder, Cumberland Advisors, joined Lisa Abramowicz and Paul Sweeney for a Bloomberg-Interactive Brokers Studio segment on September 4, 2019. He discussed markets and the current investment outlook and he’s asked when investment managers should “dip their toe in or pull their money out.” David also talked about Cumberland Advisors’ quantitative work and the signals of panic and fear (see Matt McAleer’s & Leo Chen’s talk about that here: https://youtu.be/yir-3H2Dfxg).

This material that follows is excerpted from that interview with David.


Cumberland's David Kotok on Bloomberg RadioLisa –  As the market kind of jogs around this range and doesn’t really make a big move one way or another, there is a question hanging over investment managers, which is, when do they make a big move, when do they dip their toe in or pull their money out? Joining us now is David Kotok, Chairman and Chief Investment Officer of Cumberland Advisors. He joins us here in our Bloomberg Interactive Broker Studios. David, we love having you on. Thank you for being here. What are you doing at this point? Are you sitting on your hands, like everybody says they are, in terms of real money investment?

David –  Lisa, it’s always a pleasure. We’ve had a big change since the last time we talked. Last week we saw three rounds in our quantitative work on sentiment that was saying panic and fear is now rife in the markets, and that’s appropriate when you see the kind of headline risk we’ve had day after day. We became nearly fully invested in the US stock market in those selloffs. So I sit here today; and yesterday, when I had my head handed to me, having just gone in the week before, it was looking pretty bleak. Today looks a little better, but the fact is we make the case three ways. Fiscal policy is expanding. That’s a rising deficit; it’s going to be over a trillion. That’s a Trump deficit. Monetary policy is flat to easy. There isn’t a chance that interest rates go up in the United States for the next year. They go down or stay where they are. And the third one is the important one, because the entire distribution of US government debt is somewhere between, say, 1.5 and 2.0 percent interest rates; and the inflation rate in the United States is somewhere between 1.5 and 2.0 percent. If you put that together, it means the real interest rate in the United States is zero, which means money is free. Money free, loose monetary, loose fiscal, and 160 million people employed in the United States legally, with wages; and the wages are rising. Show me how you get to a big recession; I don’t see it. So, I don’t like the policy; I don’t like the trade war – I think it does a disservice to the nation and the world, and I think Navarro-Trump policy is wrong. But I have to be agnostic on policy and apply, as an investment professional, what I think is the right choice, and that’s what we did. Now we’ll find out if it’s good or bad, but we’re in a new place here.

Paul –  Yes, so of course what we’ve seen almost on a daily basis is the headline risk, which you talked about; and it brings you back to what seems to be the number one driver of daily fluctuations in the markets, which is the trade risk. So do you, from your perspective, have to put that aside and think longer-term, I guess?

David –  Well, we’re evolving a different position on trade, Paul. We used to think about this as a temporary phenomenon, and the markets played that for a year and a half. And the politics of it seemed to suggest it, but I think what has really happened is, what Trump and his policy have done, is permanently set back globalization and integration, which was at work for decades. The result of globalization and integration was a declining protectionist path – we have it – and more or less growing peace, although we had hotspots. We are reversing that. It’s a shame. What does it mean? It means we’ll have enclaves, geographically, instead of globalization. So you take the US, and you take Canada and Mexico, put them together and say that’s a North America enclave. You have another, and it will be China-centric. You have another, and it will be Europe, which is dealing now with this monstrosity of negative interest rates. But it’s a separate enclave.

And so, for us, the focus then is on this new world. We are going through what I think is a hundred-year flood, and it’s a major change. And if you try to play by the old rules, they don’t work. Good example, if I have another minute: If you take negative rates – there’s $17 trillion in negative rates (I know you follow that closely; Lisa especially follows bonds; she has for a long time) – so you say, okay, discount any asset with a negative interest rate, and the ultimate math says it’s worth infinity. Now we know that’s not possible. So all bond models don’t work when the duration is longer than the maturity. The bond model doesn’t work when you discount assets at these interest rates. You get prices which change behavior extraordinarily.

Lisa –  Okay. So all this kind of comes down to why you just shifted your money into equities. Is that correct? You shifted your portfolio?

David –  Well, that’s right. We took up the weight in equities. When the S&P 500 Index yield is higher than the 10-year Treasury, would you buy the 10-year Treasury with your money? My answer when that question comes to me is no.

Lisa –  Okay, but then I guess the flip side of that is, do you think that bonds are going to underperform, given that relationship, or do you think that stocks just need to rally a whole bunch more to sort of right-size everything, and then just returns will be lower going forward?

David –  I think bonds underperform in price as yields get restored, if we don’t have a global recession or depression, if we don’t repeat Smoot-Hawley. And in the mature economies – in the US, which is now 70 percent services – it’s not that likely. You can’t make that case so strongly, or at least I can’t. I hear it all the time: The world is coming to an end. Here’s a Kotok forecast: The world won’t come to an end. And if I’m wrong, you can tell me how wrong I am.

Paul –  So, David, are you thinking – what we’ve heard from some people is, it is perhaps a new world order, less global perhaps; but that suggests that global growth is going to be less going forward over the next 10, 20 years than it was over the prior periods.

David –  I think you’re right. I think, Paul, global growth slows because we have impediments to it now instead of assistance to it. You know, for me, this is tough. I spent my entire adult life in philanthropic work and geopolitical work with organizations devoted to globalization and integration, attaining peace and a higher standard of living worldwide. And it’s all coming apart. And the reason it’s coming apart is a misguided policy that originates in Washington. That’s awful. So, it’s hard, on the policy; but I sit with my partners at the firm, and I say, we don’t make this policy. Our job is buy, sell, or hold for a client. And now we have an entry, and we have an entry because the world looks so ugly and crazy.

Paul –  Right. Interesting. David Kotok, thank you so much as always for your comments. Very interesting takeaway, Lisa, is that Mr. Kotok is using the recent volatility, the recent weakness in the market to get a little bit more aggressive on the equities side.

Lisa – I think it’s really poignant that he said this is a hundred-year flood, that this is, sort of, turning a lot of fundamental assumptions on their heads. And what does that mean for how you look at investing and just in general how to call your perceptions? Really important outlook.

Paul – Yeah, it’s a different view and certainly one that makes a lot of sense, and it’s perhaps just recognizing how the markets have changed out there. David Kotok, Chairman and Chief Advisor of Cumberland Advisors, thank you very much for joining us and giving us your thoughts on the market.


If you’ve enjoyed this exchange, please feel free to explore other interviews and conversations at the Cumberland Advisors website or YouTube channel.
Website: https://www.cumber.com/tag/radio-podcasts/
YouTube: https://www.youtube.com/CumberlandAdvisors


NOTE: Links to other websites or electronic media controlled or offered by Third-Parties (non-affiliates of Cumberland Advisors) are provided only as a reference and courtesy to our users. Cumberland Advisors has no control over such websites, does not recommend or endorse any opinions, ideas, products, information, or content of such sites, and makes no warranties as to the accuracy, completeness, reliability or suitability of their content. Cumberland Advisors hereby disclaims liability for any information, materials, products or services posted or offered at any of the Third-Party websites. The Third-Party may have a privacy and/or security policy different from that of Cumberland Advisors. Therefore, please refer to the specific privacy and security policies of the Third-Party when accessing their websites.


If you like podcasts, check out this one from 2015 featuring David Kotok talking about his background and Camp Kotok with Barry Ritholtz. They also talk about the history of Cumberland Advisors since its founding, and delve into fundamental principles of investing and valuation.


Links here
https://itunes.apple.com/us/podcast/masters-in-business/id730188152?mt=2

And here
http://www.bloomberg.com/podcasts/masters-in-business/




Bloomberg P&L Podcast: Boris Johnson, AI, Fed with John Authers, David Kotok, and others

Bloomberg P&L Podcast: Boris Johnson, AI, Fed with John Authers, David Kotok, and others

John Authers, Senior Editor for Bloomberg Markets, will discuss why U.K. Prime Minister Boris Johnson’s Brexit strategy is in tatters after UK government loses majority in parliament. David Kotok, Chairman & Chief Investment Officer at Cumberland Advisors, on markets and current investment outlook. Chris Condon, Federal Reserve Reporter, will discuss what’s a busy day for Fed speakers, and also why Boston Fed President Eric Rosengren is unconvinced the central bank needs to cut interest rates at this month’s Fed meeting. William Quigley, CEO of the WAX (Worldwide Asset eXchange) and co-founder of Tether, discusses issues surrounding Facebook’s Libra and why blockchain apps aren’t being adopted.

Running time 29:16

Cumberland's David Kotok on Bloomberg Radio

This is a Bloomberg podcast.

LISTEN TO PODCAST HERE: Bloomberg Audio

NOTE: Links to other websites or electronic media controlled or offered by Third-Parties (non-affiliates of Cumberland Advisors) are provided only as a reference and courtesy to our users. Cumberland Advisors has no control over such websites, does not recommend or endorse any opinions, ideas, products, information, or content of such sites, and makes no warranties as to the accuracy, completeness, reliability or suitability of their content. Cumberland Advisors hereby disclaims liability for any information, materials, products or services posted or offered at any of the Third-Party websites. The Third-Party may have a privacy and/or security policy different from that of Cumberland Advisors. Therefore, please refer to the specific privacy and security policies of the Third-Party when accessing their websites.


If you like podcasts, check out this one from 2015 featuring David Kotok talking about his background and Camp Kotok with Barry Ritholtz. They also talk about the history of Cumberland Advisors since its founding, and delve into fundamental principles of investing and valuation.


Links here
https://itunes.apple.com/us/podcast/masters-in-business/id730188152?mt=2

And here
http://www.bloomberg.com/podcasts/masters-in-business/




Yahoo Finance Highlight: David Kotok on why washing machines are an important reference point in the trade war

Yahoo Finance Highlight: David Kotok on why washing machines are an important reference point in the trade war

 

Yahoo Finance - David Kotok discusses trade war

Watch the embedded video from Twitter & Yahoo Finance below.

 


 

 


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Recession fears growing

Excerpt from the Sarasota Herald Tribune’s article,

Recession fears growing

Local experts offer comments on the impact of an economic downturn in Sarasota-Manatee.

Cumberland-Advisors-Patricia-Healy-In-The-News

After the longest economic expansion in U.S. history, a growing number of economists and business forecasters are raising the likelihood of a recession in the not-too-distant future.

In an August survey by the National Association for Business Economics, a solid 74% of business economists said they expect a recession by the end of 2021. Thirty-four percent of those economists believe a slowing economy will tip into recession sometime in 2021, which was up from 25% six months earlier.

An additional 38% of those polled predicted that recession will occur next year, down slightly from 42% in February. Another 2% of those polled expect a recession to begin this year.

Patricia Healy, senior vice president of research and portfolio manager at Cumberland Advisors in Sarasota:

“Recession memories die hard in most municipalities — that’s a reason rainy day funds have been built up.

“Rainy day funds, or reserves in excess of earmarked expenses, are important for a municipality to be able to manage through a recession or other unforeseen event. The practice is similar to the rule of thumb for a person or family to have four to six months of savings in case of job loss, a major car repair or other life events. Most municipalities have firmly planted in their memories the financial crisis of 2008 and the toll it took, and they have been saving up rainy day funds.”

Patricia Healy continues at the link.

Read the full article at the Sarasota Herald’s website: www.heraldtribune.com


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Cumberland Advisors Market Commentary – MMT and Camp Kotok

As David Kotok noted in his description of the intellectual discussions that occurred at Camp Kotok in Grand Lake Stream, Maine, one of the topics was so-called Modern Monetary Theory, or MMT.[1] There were four panelists, who were asked to take different sides for the sake of argument, representing positions from the most favorable to the most skeptical. The discussion was lively, but MMT was generally greeted with nervous skepticism. Reactions were skeptical because of what the theory proposes, what it assumes, and what it fails to address, i.e., inflation dynamics and the mechanics of how government will respond if and when its spending leads to inflation. The nervous reaction was rooted in the fears of many that MMT is inevitable.[2]

So let us look at the basics of MMT and try to tease out why the Camp Kotok group was so queasy about the concept.[3] First, MMT is not new and is basically a recasting or a heterodoxic synthesis of several macro theories describing what is basically a fiscal policy approach, not a monetary policy approach, to inflation, economic growth, and full employment. (As John Maynard Keynes once observed, “Practical men who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back.”[4]) Despite the title, MMT essentially says that the only role for monetary policy is to print money to enable the government to spend.[5] It is a form of chartalism, which considers money as a state-controlled asset that can be employed to achieve public policy objectives. It is rooted in the ideas of several now long-passed economists, including Abba Lerner’s concept of functional finance but also ideas expressed by Georg Friedrich Knapp, Alfred Mitchell-Innes, Hyman Minsky, and Wynne Godley, just to name a few “defunct” economists. There are five basic tenants of the so-called theory:

  1. Governments can print money to pay for goods and services without the need to collect funds in advance through taxes or debt issuance.

Note: The key underlying assumption is that the central bank is under the control and direction of the Treasury and creates however much money the government wants – either by supplying currency or simply by increasing the government’s spendable deposit at the central bank. In its pure form, it also does not admit, or discount, the fact that other forms of nongovernmental money can exist at the same time. The proponents sweep aside the current separation in the US between the Treasury and Federal Reserve; under law, the Fed cannot lend to the government nor buy debt directly from the Treasury. In fact, an act of Congress would be required to change the Federal Reserve Act to permit the kind of Treasury/Fed linkage envisioned in MMT.

  1. The government cannot be forced to default on debt denominated in its own currency since it can always print money to pay back what is owed.

Note: The assumption here is that a country is able to borrow in its own currency, and hence its currency is essentially a reserve currency asset. Countries that borrow in another currency, as has happened in some Latin American countries, can default and have, de facto, done so.

 

  1. The theory assumes that inflation will not accelerate until the economy has achieved full employment.

Note: The theory as well as its proponents are mainly silent on the underlying inflation dynamics and seem to assume no upward creep in inflation until after full employment is reached. In this sense there is no tradeoff between employment and inflation as assumed, for example, by the Phillips curve analysis.

 

  1. When inflation does appear, government can simply raise taxes and issue debt to reduce the money in circulation and to stem any inflation that may have manifested itself.

Note: It is assumed that Congress with impose taxes and the Treasury will issue debt in a sufficiently timely fashion to shut down inflation. The theory is silent regarding both the politics of how taxes are imposed and how and when tax increases are reversed when inflation declines to an as-yet-undetermined but acceptable level.

 

  1. It is assumed that government debt issuance does not compete with private sector borrowing and does not crowd out private sector investment.

Note: This assumption rests on the idea that because government doesn’t need to borrow or tax to generate revenue, government debt issuance serves only to extract money from the system and does not compete with other private sector investments.

Critics have noted many flaws in the theory, especially as it applies to the US.[6] First, under MMT, proponents claim that a government can fund itself by printing money by having the central bank create a Treasury deposit, which when spent becomes high-powered money within the banking system without the need to issue public debt.[7] This construct exists because in MMT the central bank and Treasury are considered one entity. The government purchases goods and services with printed money or a with draft on the Treasury’s account with the central bank and when spent this is how an economy obtains money to conduct business.[8] Such government purchases are viewed as costless since printed money bears no interest and government spending is a principle source of job creation and fiscal stimulus. This fiscal activity can continue until full employment is achieved and inflation breaks out. Then, to control inflation, government simply imposes taxes sufficient to reduce the outstanding money supply to the point where price stability is achieved. Proponents, as noted above, conveniently ignore the political realities of how tax policy is set and even the fact that it is Congress and not the Treasury that determines tax policies. As we consider the alternative arrangement envisioned in MMT, we might note that the histories of countries where central banks lack independence are fraught with examples of hyperinflation and instability, Argentina being but one prime example.[9]

Second and most importantly, the current separation between the Federal Reserve and the Treasury means that the only way the Treasury can get balances at the Fed is to transfer tax revenues collected in bank tax and loan accounts from the receiving bank to the Fed by crediting the bank’s reserve account and debiting the Treasury’s account with the Fed. That is why the Treasury’s access to funds is endogenous, not exogenous as proponents claim.[10] When those funds are spent, they flow back into the banking system by increasing bank reserves and decreasing the Treasury’s balance, with no impact on the size of the Fed’s balance sheet. The only way high-powered bank reserves are created is through the Fed’s buying Treasuries in the open market (but not from the Treasury) or by redeeming currency returned to the Fed. When the Treasury engages in deficit spending, it issues debt in the market; the public’s asset holdings shift in composition from deposits to Treasuries; Treasury balances at the Fed go up; and when these are spent, bank reserves go up and Treasury balances go down with no change in the size of the Fed’s balance sheet. But now Treasury is spending in lieu of the private sector. As was the situation during QE in response to the Great Recession, the Federal Reserve’s holdings of Treasuries increased on the asset side, and reserve balances increased on the liability side of the Fed’s balance sheet, the private sector Treasury holding (outside the Federal Reserve) declined, and bank reserves (and the public’s demand deposits) increased.

The skepticism about MMT voiced at the Camp Kotok meeting was rooted in the belief that the theory would not work in practice, and the nervousness was due to the fear that MMT implies a way to achieve the spending objectives of many of the current presidential candidates. Indeed, one of the proponents, Stephanie Kelton, was an advisor to Bernie Sanders during his 2016 presidential campaign. The fear was heightened by the fact that neither political party, based on the huge deficits embedded in the recent budget agreement that was passed into law, had the will to be disciplined about the country’s fiscal situation. All in all, the conclusion was that MMT was a theory that promised manna from heaven, and as such it had great appeal, but with potentially disastrous consequences for our country.

Robert Eisenbeis, Ph.D.
Vice Chairman & Chief Monetary Economist
Email | Bio


[1] See “Report from Leen’s Lodge(Camp Kotok): https://www.cumber.com/cumberland-advisors-market-commentary-katie-darden-and-camp-kotok/.

[2] To listen to the discussion, go to https://soundcloud.com/user-529956811/mmt-discussion-raw. Moderated by Jim Bianco, the presentations started with the most favorable view, presented by Sam Rines, followed by Lyric Hughes Hale, Danielle DiMartino Booth, and Stuart Taylor.

[3] This account is best viewed as a Cliff Notes version of the theory. Much has been written on the topic, but readers can find references on Wikipedia. And for a fairly concise discussion of both the nuances of the theory and critiques of it, see Modern Monetary Theory: A Debate, Political Economy Research Institute, University of Massachusetts Amherst, which includes the following papers: Brett Fiebiger, “Modern Money Theory and the ‘Real-World’ Accounting of 1-1<0: The U.S. Treasury Does Not Spend as Per a Bank; Scott Fullwiler, Stephanie Kelton, and L. Randall Wray, “Modern Money Theory: A Response to Critics;” and Brett Fiebiger, “A Rejoinder to ‘Modern Money Theory: A Response to Critics’”; January 2012, Working Paper Series Number 279 (http://www.peri.umass.edu/fileadmin/pdf/working_papers/working_papers_251-300/WP279.pdf).

[4] https://www.goodreads.com/quotes/212215-practical-men-who-believe-themselves-to-be-quite-exempt-from

[5] There are many attempts to describe MMT but see for example https://en.wikipedia.org/wiki/Modern_Monetary_Theory.

[6] See https://www.pragcap.com/modern-monetary-theory-mmt-critique/.

[7] This is an admittedly bare-bones description of how the theory supposedly works.

[8] This setup ignores the fact that most economies have not only currency but also private monies like bank deposits.

[9] It is interesting to note that in 1900 the US and Argentinian economies were the same size in terms of GDP.

[10] The two exceptions are that the Treasury has in the past issued greenbacks to fund the Civil War and silver certificates later on, but these were tied to gold and silver, respectively.


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David Kotok, an ‘old curmudgeon’ in finance, not afraid of Trump

David Kotok: an ‘old curmudgeon’ in finance, not afraid of Trump

by John Biers, AFP • August 24, 2019

David R. KotokExcerpt:

New York (AFP) – Investment advice from financial managers generally follows a predictable template: Update clients on the economy and stock market, endorse long-term investing — and avoid hot-button topics.

David Kotok, a veteran financial advisor, takes a different approach, mixing in deep dives on gun control, the First Amendment and other political issues with discussions of stocks and bonds.

An outraged Kotok blasted Donald Trump last month after the US president said four non-white US Congresswomen should “go back home” and led a rally where his supporters chanted “send her back” against Democratic Representative Ilhan Omar, who is Muslim.

“Send them back” is “an affront to everything our great nation stands for,” Kotok wrote in a July 24 note for his firm, Cumberland Advisors, that bemoaned a culture “inundated by political trash” and excoriated Trump’s relentless personal attacks on Federal Reserve Chair Jerome Powell.

In an interview, Kotok said his disagreements with the president stem originally from economics.

Millions of jobs remain unfilled because of Trump’s restrictive immigration policies, Kotok argues, limiting the economy’s ability to grow.

And businesses are deferring key investments because of uncertainty aroused by Trump’s swerves on trade and use of punitive tariffs, he said.

Read the full story at Yahoo Finance, linked below.

https://news.yahoo.com/david-kotok-old-curmudgeon-finance-not-afraid-trump-030236791.html

 


Links to other websites or electronic media controlled or offered by Third-Parties (non-affiliates of Cumberland Advisors) are provided only as a reference and courtesy to our users. Cumberland Advisors has no control over such websites, does not recommend or endorse any opinions, ideas, products, information, or content of such sites, and makes no warranties as to the accuracy, completeness, reliability or suitability of their content. Cumberland Advisors hereby disclaims liability for any information, materials, products or services posted or offered at any of the Third-Party websites. The Third-Party may have a privacy and/or security policy different from that of Cumberland Advisors. Therefore, please refer to the specific privacy and security policies of the Third-Party when accessing their websites.

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Cumberland Advisors Market Commentaries offer insights and analysis on upcoming, important economic issues that potentially impact global financial markets. Our team shares their thinking on global economic developments, market news and other factors that often influence investment opportunities and strategies.