The Current Uncertainty May Yield New Opportunities For Buying
If we were all uncertain before, what are we to be today. We are going to war. No maybe not. But we are, as soon as Congress accepts the blame for when it goes wrong. As usual Obama needs someone to blame and it will no longer work to blame Bush so lay it on Congress. Between Ron Paul mouthing truly ridiculous isolationist statements that sound more like those heard in 1939 as London was burning, and one of the left wing California Congresswomen saying we need to think of a good way to punish Assad short of war, one wonders if there is a test to see who is really dumb to be able to run for Congress. When one listens to the various statements coming out of Washington and the mainstream media, you wonder how America ever achieved such success.
In four weeks we get Obamacare just as the war in the Mideast is really ramping up. The one certainty of Obamacare is that it is a train wreck, nobody who voted for it ever bothered to foresee the unintended consequences, and clearly nobody read it before voting for it. If the tea party had half a brain they would vote to fund it as asked by Obama and let it crash as it will. That way Obama owns it and cannot blame the Republicans for being obstructionist. The Republicans would sweep the next election if they would just let him have the money and let the Democrats own it outright. This is going to be a major mess of biblical proportions as older people, and not younger people sign up for the exchanges. It makes little economic sense for a healthy young person to sign up now. Part time hiring is already becoming a sizable portion of the recent hires. Even the AFL-CIO says that is the case and that Obamacare, which they once supported, will be a disaster for full time workers. Think about that for a minute. The top union organization is now railing against the health care law. They are a big part of the Democrats’ base for elections. Obama and Pelosi have handed the next election to the Republicans but the tea party can’t grasp what is going on and they glorious opportunity they are about to blow.
And while we are now swallowing valium to try to stay calm, the debt ceiling and new fiscal cliff are coming roaring in exactly when Obamacare begins. In the end there will be another continuing resolution and kick the can, but the sequester will continue. That is good and bad. Good in that it is cutting the deficit. Bad it is doing so in stupid ways. Just as the Mideast war is ramping up we will have another major cut to the defense budget. Brilliant. Only Washington could manage this nonsense.
In case you get bored while all this is happening and the capital markets have no idea which way to go, we have the Fed starting taper. While that should be fully ingrained by now in the debt markets, who knows how the markets will react with all the other things going on.
As a topper, we will at this same time be really ramping up the so called “phony scandals”, IRS, Benghazi, NSA, Eric Holder lying to Congress, the attempt to intimidate James Rosen and AP.
Now that interest rates are rising and cap rates as well in conjunction, do you really think you can forecast anything with any degree of remote accuracy. If you do you have an outsized ego. What if Iran retaliates, what if Israel decides the US has all its assets in the area so now is when to attack Iran since they know they cannot count on Obama to be there when that red line is crossed late this year or next. Then all bets are off.
There are so many black swans circling right now, it is best to not be in the open. Many believe the distressed debt buying opportunity is passed, but given the magnitude of the crises which are unfolding, it is possible that distressed assets will return late this year or early next. Standby your cash and see how things unfold over the rest of this year, and then there may be new opportunities you had not expected.
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