IS THE ARC OF HISTORY NOTHING BUT AN ILLUSION?

By: Kent Engelke | Capitol Securities
From: 2/7/17

Yesterday was an exceptionally quiet and slow day as a note of caution is spreading through the global markets. Political uncertainty is rising in both France and Germany, two countries that have championed the ECB and globalization.

There is little on the economic calendar and most of the tier IS&P 500 companies have posted results thus all attention will be focused on political development both here and abroad.

Perhaps the only concrete statement to make is if the nationalist parties continue to gain momentum (and offices), especially in Germany and France, globalism will be dead in its entirety.

If this occurs, an idea has failed, the result of a dysfunctional welfare state that forgot about the voter in the hopes of some grandiose and illusive one world order. Wow! This sounds like a line from Star Wars.

Markets hate uncertainty and typically trades lower in such times. But will it be different this time, a phrase that strikes fear in anyone’s heart for it is never different… there are just different people?

About 25 years ago when I first started to opine about global politics, I wrote an extensive report commenting about how the EU and ECB will prosper in good times, but will implode in economic difficulties given the simple premise of there is no interest like self-interest. I wrote in times of economic difficulty, nationalism will trump interdependency and globalism. I also remarked the culture of Western Europe is different than Eastern Europe and north is the opposite of the south, an environment that even the most thought out legislation can not overcome.

Little did I know how prophetic my remarks have become.

Today, The Establishment, defined as anyone who is in power or a position of influence, is fighting the return of nationalism via all means possible, the result of trillions of dollars invested. An idealistic idea that has come to pass because of economic injustices, the result of failed polices that only benefited a select few.

Earlier, I remarked that it is never different, there are just different people. Perhaps “normalcy” is now returning and the Arc of History was nothing other than an illusion.

Enough of the geopolitical and socio economic gobbledygook, as stated above, yesterday was a quiet day. Treasuries however did rally about a ½ point on global political concerns.

Last night the foreign markets were up. London was up 0.64%, Paris up 0.05% and Frankfurt up 0.60%. China was down 0.12%, Japan down 0.35% and Hang Sang down 0.07%.

The Dow should open nominally higher. The 10-year is off 3/32 to yield 2.43%.


One thought on “IS THE ARC OF HISTORY NOTHING BUT AN ILLUSION?

  1. Pingback: Stephen Miller's power and yesterday's links

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