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Doug Kass' 15 Surprises For 2020

Espaço dedicado a todo o tipo de troca de impressões sobre os mercados financeiros e ao que possa condicionar o desempenho dos mesmos.

Re: Doug Kass' 15 Surprises For 2020

por perneta » 30/12/2020 13:33

Boas Por acaso já estava a ler as previsões para 2021. tou a gostar logo da primeira :) :)
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Re: Doug Kass' 15 Surprises For 2020

por Ulisses Pereira » 30/12/2020 13:23

Deixo aqui o balanço que ele fez destas "surpresas possíveis" de 2020 e mais logo à tarde coloco as possíveis surpresas para 2021.

" (...) So, I said we'd be grading the surprises for 2020 that I unveiled a year ago.

Turns out I had a near average year relative to my historic percentages - with 40% of my Surprises were correct. (My worst hit rate was in 2013 when only 20% of my Surprises occurred. My best was over 60% in 2018).

But, more importantly, I had four of my first five (and most important rated Surprises) correct this year. In the case of the Presidential election, my forecasts for voter turnout, popular and Electoral College votes was eerily accurate.

As we entered 2020, most strategists expressed a constructive economic view of a self-sustaining domestic recovery, held to an upbeat corporate profits picture (abetted by the 2018 corporate tax rate reduction), there was a unanimous view that interest rates would climb and generally shared the view that the S&P 500 would rise in the range of 8% to 10%. As well all now know, the S&P Index rose by about 15% and interest rates fell hard as the world suffered under Covid-19.

Many readers of this annual column assume that my Surprise List will have a bearish bent (and to be sure, that was the case in the last few years and back in 2007-08). But I have not always expressed a negative outlook in my Surprise List and I often have positive (and out of consensus) things to say about individual companies and sectors.

Below is a report card (40% correct) of my 15 Surprises for 2020 (the surprise is in boldface and my analysis follows each surprise):

Surprise #1 Trump Popularity Falters Badly, the Progressive Wing of the Democratic Party Fails to Catalyze Voters, Biden Easily Wins the Presidency and Democrats Have a Clean Election Sweep (As Women and Millennials Show Up in Droves)... Voter Turnout rises by over +6% (from 2016) - most of the incremental change is captured by Biden who wins 50.7% of the popular vote compared with 46.3% for Trump - a plurality of over 6 million votes. (That compares to 48% for Secretary Clinton and 46% for President Trump in 2016 - a difference of 2.9 million votes). Senator Biden also wins a surprisingly large majority in the electoral college (304 to 234). After the election, there are violent demonstrations around the country by Trump supporters in mid- to late- November. Trump does little to squash or calm down the protests and instead holds a number of rallies against Democrats and the election results. In December, 2020, President Trump announces his plans to launch Trump TV. Sean Hannity leaves Fox News - assuming a duel role as CEO of Trump TV as well as the station's chief commentator. Rush Limbaugh and several Fox News commentators join Trump TV... Biden was dismissed in the early stages of the Democratic primaries but beginning in South Carolina the President-elect's fortunes turned. Biden ultimately received 306 electoral votes against Trump's 232 votes (ALMOST EXACTLY THE 304 VOTES I EXPECTED). Voter turnout was indeed robust (turnout was 66.5% of eligible voters, highest since 1900) - with 20 million more votes in 2020 over 2016. Biden received 81 million votes (or 51% of the total and shattering President Obama's 69.5 million votes) compared to Trump's 74 million votes (47% of the total) - again, almost the exact percentages I projected 12 months ago! VERY RIGHT

Surprise #2 Disappointing Global Growth, Weakening Corporate Profits, a Fed Pivot and Political and Geopolitical Instability Produce a "Garden Variety" Bear Market in 2020... Though the Fed did not pivot there was a dramatic drop in global economic growth and in U.S. corporate profits. We had a Bear Market in 2020. VERY RIGHT

Surprise #3 The China Trade Deal Falls Apart, China's Patience With Hong Kong Runs Out and There Is a Global Shortage of Protein... The trade war is reignited and tariffs are reimposed on China. Capital spending, consumer and business confidence falters. China doesn't comply with "Phase One" of the trade deal which offers little more than purchasing needed agriculture products and fails to protect U.S. intellectual property. China's patience in Hong Kong runs out and it takes action that sets off both a geopolitical and stock market crisis. China's aggression ends any chance for a "Phase Two" trade deal. VERY RIGHT

Surprise #4 Watch Out Below! Automobile Industry Sales Plummet and Threaten the Domestic and Global Economies... Auto industry sales closed out 2019 at a 17.1 million SAAR rate for the month of December. SAAR fell to a 8.6 million rate within four months! VERY RIGHT

Surprise #5 With Draghi Gone, ECB Monetary Policy Abruptly Changes and Interest Rates Are Increased. VERY WRONG

Surprise #6 Despite Weakening Economic and Profit Growth the Federal Reserve Does Not Lower Interest Rates This Year. VERY RIGHT

Surprise #7 Berkshire Hathaway and Warren Buffett Surprise the Markets - On Several Fronts... Berkshire Hathaway, with over $130 billion of cash, acquires FedEx (for $55 billion) in a spirited bidding contest against Walmart (WMT) . There are several important catalysts to the transaction - Buffett understands FDX's business and the deal would expand his scale in transportation - where he already enjoys a stronghold in rails with subsidiary Burlington Northern. Moreover, despite the recent Amazon issue, FedEx has a wide business moat with a vast distribution presence and a large fleet of vehicles. Finally, FedEx' shares have been pummeled (-20%) because of a difficulty in adopting to digital commerce and the company could be purchased on the cheap at under 20x earnings...Berkshire makes two more large acquisitions - reducing its cash position by $100 billion to $30 billion. Fires in California grow entirely out of control, shutting down much of the power grid in California - and hobbling the state's economy. President Trump does not come to the aid of the state until too much damage is done. But Buffett helps and provides bankruptcy financing by Pacific Gas and Electric (PCG) . While it is normally impossible to buy a regulated utility, at the request of regulators Berkshire ultimately takes control of the company. Contrary to being a "forever holding," Berkshire unloads a portion of its Apple (AAPL) long investment after the stock becomes too large a percentage of its portfolio... Though Berkshire did sell down some of its Apple holdings the rest of the surprise was incorrect. VERY WRONG

Surprise #8 Goldman Sachs (In An Attempt To Expand Its Retail Presence) Acquires The Vanguard Group (with over $5.3 trillion of assets under management)... Goldman Sachs was quiet but Morgan Stanley acquired Eaton Vance. WRONG

Surprise #9 Stock Surprises Abound - Boeing, General Electric, Tesla, ViacomCBS, Comcast, Google, Facebook, Kohl's, Ford, Square, Twitter, Federal Express, European Banks, U.S. Pharma/Healthcare and U.S... Most of these did not come to pass. WRONG

Surprise #10 The SoftBank Unraveling Spreads to Sand Hill Road WeWork isn't the last failed unicorn that tries to IPO itself. The private values on a basket of money losing unicorns falls by over 30%... Venture capital becomes scarce. There are negative knock on effects throughout the Northern California economy. Late in the year Facebook (FB) , Alphabet (GOOGL) and Amazon (AMZN) begin to show the signs that a chunk of their revenue comes from venture based start-ups - their share prices suffer. Private equity does not escape the turmoil in venture capital... There was no "contagion." WRONG

Surprise #11 A Well Known Trader\Investor Who Frequently Appears on Bloomberg, Fox Business and CNBC is Indicted By the SEC For Failure to Disclose His Transactions and Investment Positions In a Proper and Timely Manner... Didn't happen but I see this in the future. WRONG

Surprise #12 A Large Sell-Side Brokerage Firm Abandons its Research Department Owing to Unbundling of Services and the General Lack of Profitability Associated With Their Efforts... Didn't happen but I also see this in the near future. WRONG

Surprise #13
FANG(A) Gets Redubbed FAMG(A) With Microsoft Replacing Netflix... The competition from other streaming services causes Netflix (NFLX) to lose millions of domestic subscribers. The whole pricing power story unravels and market loses faith in the cash burning narrative. Netflix's shares trade down to $200/share... Netflix signed up only 2.2 million new paid subscribers between July and September of 2020, its smallest quarterly increase since 2016, bringing the company's total number of subscribers worldwide to just over 195 million - but it did not lose subs. The shares fell to $290 in March. WRONG

Surprise #14 Market Structure Haunts Our Markets Throughout the Year... The dominance of ETFs and quant strategies (e.g. risk parity) shows its ugly side...The 2019 movie is in reverse this year - the ETFs and quant products and strategies that delivered a recipe for the relentless advance last year are reversed and, with so many looking to exit, liquidity evaporates. ETF prices, in particular, exhibit greater volatility than the underlying constituent holdings. The dominance of passive strategies is threatened and active strategies begin to garner inflows after a lengthy period of losing market share. Over one quarter of the listed ETFs are delisted... A "Flash Crash" takes the S&P Index down by over -5% in one day. Volatility rockets to over 35 and stays elevated for most of the year... The February March decline in equities was unprecedented in time and magnitude. RIGHT

Surprise #15 A Credit-Related Event Causes a Market Liquidity Crunch as Covenant-Lite, Leveraged Loans, BBB-rated Downgrades All Pose a Potential Threat to Both the Debt and Equity Markets. Credit conditions tighten with more differentiation between CCC and BBB corporate and consumer credit. More companies fall out of CCC and out of BBB into high yield. VERY WRONG



Last year I wrote:

"More than any year in the last decade, the contour of the U.S. stock market will likely be importantly influenced and shaped by politics and profits in 2020. Surprises in the political arena and in corporate profitability are my first two and most important deviations from the consensus. 2020 could be the year of mean reversion - a year of the vanishing Fed (and global central banker) put and a surprising turn in central bank policy (by the ECB), weakening global economic growth and less than expected corporate profits (again), political upsets (again), rising geopolitical risks (and global conflicts), a general recognition of the risks associated with untamed deficits and large debt loads and general market instability."

The politics of 2020 initially set the stage for the markets and the global economies but it was Covid-19 (and the policy responses) - a Black Swan and virus that no one expected - that framed the markets throughout the year. NO ONE expected the magnitude and swiftness of the recovery of the capital markets to all-time highs in December, 2020 as multiples reset higher based on the confidence in a hockey stick rebound to both domestic economic growth and in S&P profits in 2021."

Doug Kass
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Re: Doug Kass' 15 Surprises For 2020

por BearManBull » 21/12/2020 18:19

Surprise #1 Trump Popularity Falters Badly, the Progressive Wing of the Democratic Party Fails to Catalyze Voters, Biden Easily Wins the Presidency and Democrats Have a Clean Election Sweep (As Women and Millennials Show Up in Droves)


Acertou, mas sem covid talvez não tivesse acertado.

Quando saiem as de 2021?
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Re: Doug Kass' 15 Surprises For 2020

por BearManBull » 23/1/2020 17:33

Relativo ao número 5 deste ano vejo alta probabilidade de tal acontecer não pela economia mas pelas políticas ambientais. O BCE ao contrario da FED não é independente da política e tem como objectivo não só a estabilidade dos preços como também estabilidade politica e social.

Revisão da estratégia do BCE arranca. Meta da inflação e ambiente no topo das prioridades
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Re: Doug Kass' 15 Surprises For 2020

por Ulisses Pereira » 20/1/2020 17:33

Bom trabalho lfmh.

2 e meia em 15. Em média costuma ser 20%, esteve um pouco abaixo desta vez ;)

Abraço,
Ulisses
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Re: Doug Kass' 15 Surprises For 2020

por BearManBull » 20/1/2020 17:26

As do ano passado, marcadas a verde e vermelho, por mim, consoante verificadas ou não.

A do Brexit é meia verdade porque tecnicamente ainda não aconteceu.

1) A U.S. Recession in 2019 Followed by Stagflation:

We learn, in 2019, the extent to which economic activity was pulled forward by the protracted period of historically low interest rates – as capital spending, retail sales, housing and autos founder further.

With U.S. Real GDP growth dropping to +1% to +2% in the first half of 2019, inflation remaining stubbornly high (especially of a wage-kind as the labor market remains tight) and with cost pressures unable to be passed on, the threat of recession intensifies.

By the third quarter of 2019 U.S. Real GDP turns negative. Tax collections collapse as government spending continues to rise. The budget deficit forecasts are lifted to over $2 trillion.

The U.S. falls into a recession in the last half of 2019 – followed by a lengthy period of stagnating economic growth and higher inflation (stagflation).

A dysfunctional, non-unified and discombobulated Europe also falls into a recession in 2019 – with significant ramifications for U.S. multinationals that populate the S&P Index.

U.S./Chinese trade tensions push the global economy down the hill as the year progresses and GDP growth in China comes in below +5.0%. The IMF reduces it’s global economic growth forecast three times next year.

S&P per share earnings fall by over -10% in 2019.

2) The Federal Reserve Pauses and Then Cuts as Currencies and Interest Rates Swing Wildly:

It’s a wild year for fixed income and currency volatility.

The Fed cuts rates in 3Q2019 and by year-end announces that QE4 will commence in January, 2020.

The 2018 tantrum in Italian bonds is just a precursor for hissy fits throughout the European bond market as the ECB is no longer expanding its balance sheet and tries to get out of NIRP.

The BoJ throws in the towel on their drive for higher inflation. The Japanese bond market sees sharp selloff.

During 2019 the yield on the ten year U.S. note falls to 2.25% before ending the year at over 3.50% as the selloff in European and Japanese bonds and the announcement of QE4 drive our yields higher. Gold falls to $1050 before ending the year at over $1700.

3) Stocks Sink:

Though the third year of a Presidential cycle is usually bullish – it’s different this time.

Trump confusing brains with a bull market can’t fathom the emerging Bear Market. At first he blames it on Steve Mnuchin, his Secretary of Treasury (who leaves the Administration in the middle of the year). Then he blames a lower stock market on the mid-term election which turned the House. Then he blames the market correction on the Chinese.

The S&P Index hits a yearly low of 2200 in the first half of the year as the market worries about slowing economic and profit growth and a burgeoning deficit/monetization. The announcement of QE4 results in a year end rally in December, 2019. In a continued regime of volatility (and in a market dominated by ETFs and machines/algos), daily swings of 1%-3% become more commonplace. Investor sentiment slumps as redemptions from exchange traded funds grow to record levels. The absence of correlation between ETFs and the underlying component investments causes regulatory concerns throughout the year.

Congress holds hearings on the changing market structure and the weak foundation those changes delivered during the year.

Short sellers provide the best returns in the hedge fund space as the S&P Index records a second consecutive yearly loss (which is much deeper than in 2018).

As the Fed cuts interest rates the US dollar falls and emerging markets outperform the US in 2019.

I, like many, are concerned about corporate credit (See Surprise #8) and though credit is not unscathed, it is equities that bear the brunt of the Bear since they are below credit in the company capitalization structure.

Bottom line, after a steep drop in the first six months of the year, the markets rise off of the lows late in the year in response to this shifting political scene (the decline of Trump) and a reversal to a more expansive Fed policy – ending the year with a -10% loss.

4) Despite the Appearance of the Bear, FANG Stocks Surprisingly Prosper (Both Absolutely and Relatively) as Investors Seek Growth (at any cost) In a Slowing Economy – Facebook’s Shares Rebound Dramatically:

While there is a growing consensus that FANG will lead a Bear Market lower – that is not the case as growth, in a general sense, is dear and cherished by market participants next year. Among FANG, Facebook‘s shares have a reversal of fortune (and is the best performing FANG stock) as the company announces aggressive management changes and moves to remedy the misinformation trap.

As more previously unrevealed information reduces her valuation, Sheryl Sandburg’s special status as a female leader (in a seascape of men at Facebook and in industry) is questioned. In the first half of 2019, Sandberg becomes a sacrificial lamb and is sacked – and is forced to lean out after leaning in.
At the suggestion of Warren Buffett (who has accumulated a sizable stake in the company), former Board Member Donald Graham is named as the new, independent and Non-Executive Board Chairman of Facebook.

This unexpected move encourages FB investors to believe that the company is quickly moving to fix its multiple data and privacy issues.

Fewer (than feared) Facebook members opt out and growth in usage resumes in the back half of 2019.

FB’s stock popularity (and market capitalization) increases as it becomes a more dominant holding in “value investors” portfolios – the shares trade above $200/share late in the year.

5) “Peak Trump” – the President Bows Out in His Pursuit of a Second Term:

The President’s dismissal of the murder of Washington Post reporter Jamal Khashoggi is seen as delivering tacit support to Saudi Arabia’s MBS – it is a pivotal turning point in Trump’s popularity and ultimate reputational decline in 2019. “Pay enough and you can get away with murder” becomes the mantra of the Progressive Left. Trump acceptance by his Republican party peers quickly diminishes as they are further worried about his motivation to side against the findings of his own intelligence department. After Trump’s personal dealings with authoritarian and autocratic countries are revealed in the Mueller probe (along with possible emoluments violations), Trump’s popularity fades further as Lindsay Graham and other prominent Republicans repeal their support and denounce the President.

An anti-imperial rebalancing is mounted, in which a more assertive Congress brings the country back into constitutional equilibrium.

Though the public and political leaders (even on the right) increasingly reject the President, there are no impeachment efforts by the Democrats. Instead (and surprisingly), House Speaker Pelosi (recognizing that constructive steps are the recipe for a Democratic 2020 Presidential win) exacts discretion and stops the Democrats from moving on an impeachment in the House. Democratic leadership turns to reforms and a torrent of new legislation in the areas of improving the environment and climate control (and the halt of growth in fossil fuel by the development of alternative energy programs), the opioid crisis, education, crime, voting rights, healthcare and prescription drug prices, immigration, etc.- showing the electorate that their Party can demonstrate the framework for a positive agenda, a vision and a social contract (and can rule instead of obstruct).

But, most importantly… With real GDP turning negative in 2019’s second half, Democrats attempt to replace Republicans’ supply-side economics with a smarter theory of growth. Recognizing just as inflation and other ills opened the door for criticism of Keynesian economics in the 1970s, so have inequality and disinvestment done the same for critiques of supply side today. In 2019, the Democrats turn the table on the supply-siders and give a voice through thoughtful proposed legislation (making the affirmative case for the Democratic theory of growth geared to raising wages and putting more money in the hands in working- and middle-class people’s pocket and investing in their needs). Americans enthusiastically embrace this alternative (of how the economy works and grows and spreads prosperity) and reject and defeat the long standing Republican economic narrative – seeing it as a better way to spur on the economy (than giving rich people more tax cuts). Asking the question “has it worked for you?” and given the fairy tale of added revenue from growth (and the widening hole in the deficit), rampant inequality, the fear of being bankrupted by medical catastrophe and massive student debt obligations Democrats provide a practical alternative to cutting taxes for the rich and decreasing regulation which has failed to unleash as much innovation and economic activity that was promised by the Administration. The legislation, which puts more money in middle class pockets, defends and supports the notion that the public sector can make better decisions than the private sector. Referred to as the “middle – in economic bill,” is cosponsored by a leading, conservative and respected Republican member of Congress and begins to gain bipartisan support in Congress, driving a stake through the supply-side’s heart.

Despite his loss of popularity (which plummets to 25%) and the push back from the Republican establishment, Trump declares he is still planning to run for President. Nevertheless, a challenge from Senator Mitt Romney (who’s motto is “Make Republicans Great Again”) gains steam as McConnell, Graham, Kennedy Et al. throw their support for the Senator.

As Trump’s problems multiply, Romney becomes the heavy favorite to defeat Trump in the Republican primary.

Recognizing a sure election defeat, by year-end the President announces that his medical team has disclosed a health issue and he is advised not to run for office. Reluctantly, Trump agrees and bows out of the 2020 Presidential race late in the year.

The Trump mantra of “Make America Great Again” is replaced by “Make Economic Uncertainty and Market Volatility Great Again.”#MAGA/#MUVGA

6) The Year of the Woman:

With a Trump withdrawal from 2020 the election is wide open.

The arc of history influences the Democratic Presidential nomination march and the leading candidates that emerge for 2020 are mostly women. The potential contenders include progressive firebrands like Elizabeth Warren, Stacey Abrams, Kristen Gillibrand and Kamala Harris, and moderates like Senator Amy Klobuchar and Rhode Island Governor Gina Raimondo.

Michael Bloomberg, Howard Schultz and Joe Biden bowout from the race by year end 2019 By year-end, Klobucher, Harris and Warren surface as the three leading Democratic Presidential candidates.

It appears that an all women Democratic ticket (President/Vice President) is increasingly likely.

Nationally, several high profile sexual harassment suits are disclosed. Allegations against a number of well known television, other entertainment and political icons/leaders serve to reinforce the candidacy of the above women who aspire to gain the Democratic Presidential nomination. After Congressional hearings, non partisan and strict harassment legislation are introduced forcing several well known male politicians to resign from office.

7) A New (But Old) Shiny Object Appears As A Stock Market Winner in 2019:

Bitcoin trades close to $3,000 in December, 2018 and spends most of 2019 under $5,000 (as numerous trading irregularities, thefts and more frauds are exposed).

England’s Financial Conduct Authority (FCA) takes the lead, in instituting a comprehensive regulatory response to regulating the crypto currency markets. The U.S. follows by imposing broad-based crypto currency regulation in 2019.

A leading business network (who’s bitcoin “bug” has become the new cover of magazine contrary indicator!) faces a class action suit for their seeming encouragement in buying into the asset class in their too frequent broadcasts during 2018. Several crypto currency guests who were prominent on the network’s coverage are indicted for fraud. In an agreement with regulatory authorities, the biz network’s programming is reconstituted.

Marijuana stocks, after a weak final few months in 2018 (are down by over 50% from their highs), explode back to the upside reflecting a quickened pace of alternative health applications. (MJ) is the single best performing exchange traded fund and (TLRY) makes another move to $300/share.

8) Private Equity, High Yield Debt and Leveraged Loan Problems (Which Have Doubled in Size Over the Last Ten Years) Emerge as the Resurgence of Leveraged Finance Comes to An End:

Private equity, in particular, the biggest winner in the decade long cycle since The Great Decession of 2007-09, suffers – and so do the endowments at several prestigious universities. Covenant- lite financings in junk and leveraged loans – often in opaque and complex structures – topple under the weight of loan defaults. (HYG) (last sale: $83.17) trades $75-$80 as redemptions spike.

Publicly-held private equity shops (KKR) and Blackstone (BX) are among the largest percentages losers in 2019, High yield bonds fulfill their characterization as “junk,” and are among the worst performing asset classes. The spread between junk bonds and Treasuries more than doubles – widening dramatically during the summer months.

9) The China/U.S.Rift Intensifies as Trump’s Anger Shifts Towards That Region:

The trade war with China goes into full effect with 25% tariffs. Walmart (WMT) is adversely impacted and its shares fall by -20% from the recent highs. The Chinese retaliate against major American brands like Apple (AAPL) . (“Peak Apple” actually happens and its shares fall below $125/share).
Peter Navarro resigns.

A major cyber-attack against the U.S. financial system, who’s source is initially not diagnosed, is ultimately reportedly to have been delivered by China. The U.S. enters a cold war with China that resembles the emergence of the cold war with Russia in 1948 – it becomes clear it will be lengthy, nasty and unfriendly to the trajectory of worldwide economic growth.

10) Bank Stocks Are Surprising Winners in 2019:

Despite some pressure in net interest margins (and income), sluggish loan demand and a pickup in loan losses – bank stocks (and EPS) are surprisingly resilient and manage to have a positive return next year as better relative EPS growth is supported by aggressive buybacks and (starting) low valuations. Investors look forward to a recovery in economic growth in 2020-21 and bank stocks (flat for most of the year) have a vigorous move in the last few months of the year and are one of the few sectors to advance in 2019.

Oil stocks, depressed from the late 2018 crude oil price fall also recovery mightily in the later months of 2019 as the price of oil advances coincident with dovish turn in monetary policy.

11) Tesla’s Problems Shift From Production to Demand to Financial:

Tesla (TSLA) loses its tax subsidy in the U.S. and in the Netherlands (a large market for them).

European competition grows.

Europe doesn’t allow the Tesla Model 3 due to safety reasons. The Chinese won’t let an American company have video data over millions of miles of roads and bans Tesla. Lenders balk and access to the public debt market evaporates. The company’s financial position deteriorates and its credit default swaps widen dramatically.

An accounting “issue” surfaces – and it morphs into an accounting fraud. Elon Musk, who has leveraged his TSLA equity holdings, faces margin calls and is forced to sell Tesla shares.

After being rushed to the hospital after an overdose, Musk leaves his CEO post to enter drug rehab.

12) Berkshire Hathaway (BRK.A) (BRK.B) Announces the Largest Takeover in History – The Transformational Acquisition of 3M for $150 billion.

13) Amazon (AMZN) Makes a Bid for Square (SQ) but Alphabet/Google (GOOGL) Eventually Acquires Both Square SQ and Twitter (TWTR)

14) With its Share Price Consistently Trading Under Its Book Value During the First Few Months of 2019, Goldman Sachs’ (GS) Partners Take the Brokerage Private in a Leveraged Buyout at $238/share.

15) Brexit Happens: The world continues and the pound is the best global currency.
“It is not the strongest of the species that survives, nor the most intelligent, but rather the one most adaptable to change.”
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Re: Doug Kass' 15 Surprises For 2020

por Celsius-reloaded » 18/1/2020 13:15

Algumas "previsões" sao tão, mas tão ridiculas que ele parece confundir a realidade/probabilidade com desejo pessoal.
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Re: Doug Kass' 15 Surprises For 2020

por Ulisses Pereira » 16/1/2020 16:18

Thoth, ele antes costumava fazer um resumo do que falhou e acertou o ano anterior, mas não encontrei este ano, onde até este parece escrito mais a correr do que habitualmente.

optimiza, desculpa usar este tópico para isso, mas não tens aberto as minhas mensagens privadas. Era importante para o fórum ;)

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Re: Doug Kass' 15 Surprises For 2020

por Optimiza » 16/1/2020 15:56

Ulisses, muito interessantes essas previsões, algumas surpreendentes, umas desagradáveis e outras desejadas, sobretudo a do FAMG (Microsoft em vez da Netflix) e do desempenho acima das expectativas de Boeing, GE, Comcast e Square.

Já a "surpresa 2" de piores lucros em Wall Street vai contra as previsões com as quais concordo - do bank of America e da Wells Fargo que esperam que o DOW valorize cerca de 15% no final do ano, baseado num recrudescimento dos lucros das majours inter sectoriais, mas com 1 ou 2 correções verticais de 15 a 25% e subsequentes subidas intensas.

“History says the secular trend could push stocks higher for another five to 15 years,” he added. But then the pullbacks can be a part of it, and he noted that while stocks rose from 1982 to 2000, there were significant drops in 1983, 1987, 1990 and 1998.

p.s. nem o Doug Kass nem ninguém fala do IPO (Out./Dez ?) para mim mais interessante dos últimos 20 anos: Impossible Foods (game changer a par da Beyond Meat - considero esta indústria a the new new thing - bem mais importante do que a Cloud, Hybrid tech e quase ao nível do 5G).

nota - O índice do frete marítimo está em recessão por causa das sanções e do caos no comércio/importações China/USA. Com o futuro acordo…..upa upa
freight index é o único dos 30 índices principais em recessão.jpg
freight index é o único dos 30 índices principais em recessão.jpg (32.44 KiB) Visualizado 8198 vezes
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Re: Doug Kass' 15 Surprises For 2020

por Thoth » 16/1/2020 15:44

Ele não publica as que falhou/acertou nos anos anteriores ?
Se sim, onde ?
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Doug Kass' 15 Surprises For 2020

por Ulisses Pereira » 16/1/2020 15:12

Já começa a ser uma tradição no Caldeirão todos os anos, por esta altura, publicarmos as previsões surpreendentes de Doug Kass para o Ano Novo.

O que acho curioso nestas previsões é que elas são possíveis surpresas para acontecer. Enquanto que nas previsões normais, o autor fica contente se acertar umas 70% das mesmas, nestas previsões do Kass se ele acertar em 20 ou 30% já fica contente porque são surpresas...

Acho que é sempre uma leitura interessante não dispenso partilhar aqui todos os ano no Caldeirão. No entanto, confesso que este ano não está tão interessante como nos anos anteriores, parecendo mais interessado nas eleições norte-americanas.

"Doug Kass' 15 Surprises For 2020: Biden Tops Trump, Stocks Slump, Auto Industry Dumps"

"Like Diogenes with his lantern, I am, again in 2020, a cynic looking for truth (and an honest investor) - as I engage in my annual assault on the consensus and "Group Stink."

More than any year in the last decade, the contour of the U.S. stock market will likely be importantly influenced and shaped by politics and profits in 2020. Surprises in the political arena and in corporate profitability are my first two and most important deviations from the consensus.

2020 could be the year of mean reversion - a year of the vanishing Fed (and global central banker) put and a surprising turn in central bank policy (by the ECB), weakening global economic growth and less than expected corporate profits (again), political upsets (again), rising geopolitical risks (and global conflicts), a general recognition of the risks associated with untamed deficits and large debt loads and general market instability.

Remember, my Surprise List is not a set of forecasts. Rather, the List represents events that the consensus views as having a low probability of happening (20% or less) but, in my judgment, have a better than 50% chance of occurrence. In betting parlance this is called an "overlay."

* * *

Surprise #15 A Credit-Related Event Causes a Market Liquidity Crunch as Covenant-Lite, Leveraged Loans, BBB-rated Downgrades All Pose a Potential Threat to Both the Debt and Equity Markets
Credit conditions tighten with more differentiation between CCC and BBB corporate and consumer credit. More companies fall out of CCC and out of BBB into high yield.

Surprise #14 Market Structure Haunts Our Markets Throughout the Year
The dominance of ETFs and quant strategies (e.g. risk parity) shows its ugly side.

The 2019 movie is in reverse this year - the ETFs and quant products and strategies that delivered a recipe for the relentless advance last year are reversed and, with so many looking to exit, liquidity evaporates. ETF prices, in particular, exhibit greater volatility than the underlying constituent holdings. The dominance of passive strategies is threatened and active strategies begin to garner inflows after a lengthy period of losing market share. Over one quarter of the listed ETFs are delisted.

A "Flash Crash" takes the S&P Index down by over -5% in one day. Volatility rockets to over 35 and stays elevated for most of the year.

Surprise #13 FANG(A) Gets Redubbed FAMG(A) With Microsoft Replacing Netflix
The competition from other streaming services causes Netflix (NFLX) to lose millions of domestic subscribers. The whole pricing power story unravels and market loses faith in the cash burning narrative. Netflix's shares trade down to $200/share.

Surprise #12 A Large Sell-Side Brokerage Firm Abandons its Research Department
Owing to Unbundling of Services and the General Lack of Profitability Associated With Their Efforts

Surprise #11 A Well Known Trader\Investor Who Frequently Appears on Bloomberg, Fox Business and CNBC is Indicted By the SEC For Failure to Disclose His Transactions and Investment Positions In a Proper and Timely Manner
The SEC discloses that many others have failed to fully disclose positions and their trading. The SEC releases a broad edict to all financial media outlets, websites, etc. to adopt new transparency and reporting requirements similar to what is currently required by sell-side brokerage firm's research departments.

Surprise #10 The SoftBank Unraveling Spreads to Sand Hill Road
WeWork isn't the last failed unicorn that tries to IPO itself. The private values on a basket of money losing unicorns falls by over 30%.

Venture capital becomes scarce. There are negative knock on effects throughout the Northern California economy. Late in the year Facebook (FB) , Alphabet (GOOGL) and Amazon (AMZN) begin to show the signs that a chunk of their revenue comes from venture based start-ups - their share prices suffer.

Private equity does not escape the turmoil in venture capital.

Surprise #9 Stock Surprises Abound - Boeing, General Electric, Tesla, ViacomCBS, Comcast, Google, Facebook, Kohl's, Ford, Square,Twitter, Federal Express, European Banks, U.S. Pharma/Healthcare and U.S. Energy
Boeing's (BA) shares experience a one day rally of nearly +10% - not because of an earlier than expected return of Max 737 production but because Airbus (EADSY) encounters its own set of major safety issues and problems.

General Electric's (GE) shares climb to $20/share as the company's makeover succeeds faster than expected. (Stan Druckenmiller reports that he made $200 million personally on his investment in GE and commits his $0.2 billion personal gain to expanding the reach of Harlem's Children Zone - Stan is Board Chairman of HCZ).

Tesla's (TSLA) shares rise to $600/share before it poops out. Elon Musk marries Grimes, his pregnant girlfriend. The couple divorces by year-end.

Old media outperforms new media - ViacomCBS (VIAC) and Comcast's (CMCSA) shares surprisingly outperform Facebook and Google's common stock.

European bank stocks are global stock winners - rising by +30% to +40%.

With Democrats gaining control of the Congress and Presidency - healthcare and pharmaceutical stocks are global losers and drop by more than -30%.

Iran waits until the summer and then unleashes physical attacks (through sleeper cells) and cyber attacks in the Middle East, Europe and the U.S. President Trump retaliates. The Strait of Hormuz is closed. The price of oil spikes to over $80/barrel (and stays high through most of the year). Energy stocks run counter to the market's losses and surprise to the upside in 2020 - with gains of nearly 20%. Several, low-priced energy companies' share price doubles in price.

A large Enron-like fraud is uncovered (and shocks the markets).

In takeover activity:

Amazon acquires Kohl's (KSS) .

Berkshire (BRK.A) (BRK.B) acquires FedEx (FDX) (see Surprise #7 below).

Jack Dorsey decides to live full time in Africa: In an attempt to improve its position in payments and social media, Google acquires both Square (SQ) and Twitter (TWTR) (beating out Salesforce (CRM) in the process).

Volkswagen (VLKAF) acquires Ford (F) (see upcoming Surprise #4).

Surprise #8 Goldman Sachs Acquires The Vanguard Group (with over $5.3 trillion of assets under management)
In an attempt to expand its retail presence.

Surprise #7 Berkshire Hathaway and Warren Buffett Surprise the Markets - On Several Fronts

Berkshire Hathaway, with over $130 billion of cash, acquires FedEx (for $55 billion) in a spirited bidding contest against Walmart (WMT) . There are several important catalysts to the transaction - Buffett understands FDX's business and the deal would expand his scale in transportation - where he already enjoys a stronghold in rails with subsidiary Burlington Northern. Moreover, despite the recent Amazon issue, FedEx has a wide business moat with a vast distribution presence and a large fleet of vehicles. Finally, FedEx' shares have been pummeled (-20%) because of a difficulty in adopting to digital commerce and the company could be purchased on the cheap at under 20x earnings.

Berkshire makes two more large acquisitions - reducing its cash position by $100 billion to $30 billion.

Fires in California grow entirely out of control, shutting down much of the power grid in California - and hobbling the state's economy. President Trump does not come to the aid of the state until too much damage is done. But Buffett helps and provides bankruptcy financing by Pacific Gas and Electric (PCG) . While it is normally impossible to buy a regulated utility, at the request of regulators Berkshire ultimately takes control of the company.

Contrary to being a "forever holding," Berkshire unloads a portion of its Apple (AAPL) long investment after the stock becomes too large a percentage of its portfolio.

At the May, 2020 Berkshire Hathaway annual meeting in Omaha, Nebraska, Warren Buffett surprises his shareholders and announces that Ajit Jain will be his successor .

The Oracle of Omaha invites me back to the 2021 Berkshire Hathaway Annual Meeting to ply him and Charlie Munger with tough questions.

Surprise #6 Despite Weakening Economic and Profit Growth the Federal Reserve Does Not Lower Interest Rates This Year
Instead of waiting until the end of Q2 as they currently have planned, the Fed ends the expansion in their balance sheet by February or March. The liquidity spark helping stocks thus ends early.

Foreigners lose their appetite for U.S. corporate debt and government securities and, despite disappointing U.S. economic growth, the 10 year U.S. note yield climbs to over 2.50%.

Surprise #5 With Draghi Gone, ECB Monetary Policy Abruptly Changes and Interest Rates Are Increased
With no more Draghi, the ECB figures out negative rates are a hindrance to growth and has gutted the European banking industry - it normalizes policy. While long term positive, it ends up creating a major disruption in the global bond markets and yields around the world spike. Most European government debt returns to a positive yield. European equity markets rise +20% (compared to a -20% drop in the U.S. indices)

European bank stocks rise by +30% to +40%.

Surprise #4 Watch Out Below! Automobile Industry Sales Plummet and Threaten the Domestic and Global Economies... Ford Is Bailed Out
"Peak Autos" remains in place and the problems facing the industry reverberate in 2020.

At every level there is a ton of automobile loan and securitized debt leverage. A record share of trade-ins last year were upside down on their loans - representing a mirror image of mortgages that existed in 2007.

Retail sales of new vehicles were down by -7% in December, 2019, leading to a retail SAAR of only 14.3 million cars (down from 15 million a year ago and from November, 2019's 14.8 million rate).

The auto industry falls into a tailspin in 2020 - fueled by burgeoning inventories, record cars going off lease (and entering the used car market), record new car prices (according to J.D. Power and LMC Automotive, the average new care price is now over $35,000), a decline in used car prices, growing and record purchase incentives (of nearly $4,600/unit, a +12% increase from last year), and rising auto loan delinquencies (which hit an all-time high in 3Q2019) causes a substantial amount of damage to the sub-prime auto asset backed securities market in 2020).

The automobile's sizable role in the domestic economy causes collateral damage to U.S. consumer confidence and spending.

Late in the year, Ford Motor (F) company teeters operationally and financially and the shares fall to under $5/share. The loss-ridden manufacturer is acquired by Volkswagen (VLKAF) .

Surprise #3 The China Trade Deal Falls Apart, China's Patience With Hong Kong Runs Out and There Is a Global Shortage of Protein
China doesn't comply with "Phase One" of the trade deal which offers little more than purchasing needed agriculture products and fails to protect U.S. intellectual property.

China's patience in Hong Kong runs out and it takes action that sets off both a geopolitical and stock market crisis. China's aggression ends any chance for a "Phase Two" trade deal.

The trade war is reignited and tariffs are reimposed on China.

Capital spending, consumer and business confidence falters.

Speaking of China, the effects of African Swine Fever Virus cause a global shortage of protein. The immediate impact a year ago was wholesale slaughtering, which created a short term surplus. But, now there aren't enough pigs. Pork prices soar with beef, chicken and fish prices rising in sympathy.

Surprise #2 Disappointing Global Growth, Weakening Corporate Profits, a Fed Pivot and Political and Geopolitcal Instability Produce a "Garden Variety" Bear Market in 2020
As we entered 2020 the almost universal view is that liquidity and the central banks' put, at the very least, provides a market floor and at the best, will contribute to the next speculative leg of the decade old Bull Market as the market train is supported by the Fed trestle.

As I finished My 15 Surprises for 2020 over the weekend and reviewed the extraordinary nature of the 2019 market -- I marvel at the Bull Market in Complacency that seems almost at the polar opposite of the doom and gloom that existed on December 26, 2018, a bit more than 12 months ago. As an example, the CNN Fear and Greed Index was around 2 (!) a year ago compared to 91 (!) this morning. The same applies to the flip flop in AAII sentiment (from very bearish to very bullish - and with the gap between the two moving to over 40).

I would be less concerned with the outlook if the market's 2019 advance was earnings derived. It was not - like in 2013 it was entirely based on a reset of higher valuations (from a PE of 14.5x at year-end 2018 to approximately 19.0x at year-end 2019). Indeed, consensus 2019 S&P EPS forecasts stood at about $178/share 12 months ago - they are likely to fall in the $163-$164/share level range. As to the 2020 S&P EPS consensus estimates, they, not surprisingly, stand at the same $178/share today! They will likely miss (by an unusually) wide mark, again.

And I would be far less concerned if a changing market structure (the proliferation and popularity of ETFs and the dominance of risk parity and quant products and strategies) coupled with the death of active investing had not served to exaggerate upside price momentum - foiling the natural price discovery many of us "old timers" yearn for.

Meanwhile, as the year concludes, precious metals have made a very "quiet" stealth rally - just look at (GLD) 's chart over the last seven weeks. (What are the gold traders seeing that we are not?)

The majority of "talking heads" who hated stocks a year ago are uber bullish on equities this year. (Didn't we learn from the wrong-footed consensus interest rate forecasts of last December, that self confidently called for a 3.5%+ 10 year U.S. note yield at 2019 year-end?)

Am I concerned? Should investors be concerned? You are damn right. Nevertheless, the consensus remains positive - and the consensus projections shine today with their typical +8% to +10% advance anticipated for the S&P Index.

My view is that next year's surprise will be a year of mean reversion, but unlike most, I make this surprise without forecast certainty as I recognize that central bankers have lost their collective minds. And so may have many traders and investors.

In 2020, the surprise would be that the "everything bubble" (in which every asset class advanced) is pierced and the notion of mean reversion of returns finally surfaces (just when no one is looking).

Though the third year of the Presidential cycle (2019) was a good one - not so much for the last year of the Presidential cycle (2020).

Despite easing money and an abundance of global liquidity, the rate of growth of the U.S. economy fails to accelerate this year - "The Fed Is Pushing On A String." Domestic GDP growth slows to under +1% in real terms. Core inflation sits at 2% (but headline inflation is much higher due to rising energy prices). Company share buybacks are sharply diminished as corporate profits disappoint and corporations begin to balk at high stock prices (another surprise)

Though economic growth is slow, interest rates begin to rise in 2020 as the growing U.S. debt load begins to matter. The bond vigilantes slowly return out of hibernation. Higher rates trips up levered corporations and levered consumers. Foreign buyers of credit and Treasuries lose interest in the U.S. debt markets and start selling.

The Fed is stuck and, not wanting to be political, ends its balance sheet expansion and makes no move on interest rates until after the election.

Higher wages and other input costs pressure corporate profits in a backdrop of slowing revenues and domestic growth.

The consensus expectation for 2020 S&P EPS of about $178/share is, for the second year in a row, way off mark as EPS growth falls for the second year in a row because of a continued decline in profit margins that +3% revenue growth can't overcome. 2020 S&P EPS per share falls to modestly below the $163-$165/share recorded in 2019.

Investors, realizing that corporate profits have essentially been flat since 2014, begin to panic at the "new normal" of subpar economic growth. Another year in which earnings growth fails to recover reverses the valuation upwards reset (so conspicuous last year) as market participants grow increasingly concerned about the real economy's secular growth prospects.

Much of the more than +25% 2019 reset (higher) of valuations is reversed in 2020 - as price earnings multiples decline by about -15%, producing a modestly larger full year decline (-17%) in the S&P Index. 2020's market drop is the worst since 2002's fall of -23%.

The S&P Index closed at 3265 on Friday. The year's high is made in the first month of the year (at under 3350), the 2020 low in the S&P Index is 2550, and the close is about 2700.

Besides the failure of corporate profits to revive the equity market is burdened by a number of other factors outlined in My 15 Surprises For 2020.

and now...

Surprise #1 Trump Popularity Falters Badly, the Progressive Wing of the Democratic Party Fails to Catalyze Voters, Biden Easily Wins the Presidency and Democrats Have a Clean Election Sweep (As Women and Millennials Show Up in Droves)
According to PredictIt and most of the other polls, the general expectation is that President Trump will narrowly win the November election, the Republicans will retain control of the Senate and the Democrats will keep control of the House.

As in 2016, the (political) consensus proves to be mistaken in 2020.

To summarize, several trends become apparent early in the year, leading to Senator Biden eventually being named the Democratic party's Presidential nominee. Biden's lead in the polls climbs and Trump trails by a surprisingly large percentage by early summer. In another surprising election result (much like four years ago) - its a clean sweep for the Democrats - Biden easily wins the November election, Democrats narrowly regain control of the Senate and the Democrats maintain control of the House.

Here is how this and the other surprising political events leading up and into the November election could go down:

Democratic Progressive Presidential Hopefuls Fail and Fall Early - Biden Is The Nominee
.Advertising money proves to be a major force in producing candidate support and votes. Both Bloomberg and Steyer climb into the top five Democratic candidates in the national polling as Senator Warren's popularity wanes.

.In the belief that only a centrist candidate can defeat President Trump in November, a surprisingly high number of Democratic voters move to the center (and to the support of non-progressive candidates) during the multiple state primaries on March 3rd.

.The progressive left of the Democratic Party moves much lower in the polls and the electability of Senators Sanders and Warren comes into question. Sanders' "hard ceiling" becomes reality as he finishes in only a weak second or third position in the early February Iowa and New Hampshire primaries. By the end of February, a surging Mayor Pete Buttigieg moves into a virtual tie for second with Sanders (and behind Senator Biden) in the national polls. Warren, seen as talking from both sides of the mouth on campaign financing, after releasing what many consider to be poorly constructed tax recommendations and following modification of some other extreme positions, falters and falls out of the top five behind Biden, Sanders, Buttigieg, Bloomberg and Steyer.

.Warren, fearful of a further fall (out of contention), approaches Sanders (who essentially shares the same positions that drags down the Senator from Massachusetts - both are fighting a "rigged system", "Medicare for all", tax the wealthy, etc.). She proposes a "prepackaged" progressive ticket and political contract (with Sanders as President and Warren as Vice Presidential candidates - with some shared "Presidential" duties). U.S. stocks briefly tank in response to the possibility of a progressive Democratic Presidential nominee. Sanders initially considers Warren's offer but rejects it and the contract unravels. Warren, with little money left in her campaign till, falls back further in the polls into seventh place (behind Andrew Yang) and drops out of the race. Surprisingly, many of Warren's supporters fail to lean towards Sanders and move to the other, more centrist candidates.

.Biden never falls behind and maintains his front running status throughout all of the primaries and into the Democratic convention.

.Late in the race, Bloomberg and Steyer, recognizing the value of a unified Democratic party against Trump transcend their own personal interests and throw their support towards Biden. Stocks start a steady descent lower as investors view the rising probability of a Democratic President as market unfriendly.

.Bloomberg (who is worth $58 billion and is the sixth wealthiest person in the U.S. and 14th in the world) commits "whatever it takes" to help Senator Biden defeat President Trump. In total, Bloomberg eventually spends over $2.5 billion on his Presidential run and later on Senator Biden's campaign and on the key Senate election contests.

.In an uncontested convention Biden is named the Democratic nominee. He selects Amy Klobuchar over Stacey Abrams as his Vice Presidential running mate.

.Stacey Abrams delivers a riveting keynote convention address and Pete Buttigieg introduces Senator Biden on the convention's final day.

.The day after his nomination, Republican Senator Mitt Romney endorses Senator Joe Biden .

Trump's Popularity Slumps Under the Weight of Impeachment and Revelations
In the first half of 2020, just as the impeachment hearings percolate, a New York Times investigation uncovers that President Trump directed the purchase of stock futures by the Fed, the Treasury and other parties (over a lengthy period of months) to buoy the U.S. stock markets and with the stated intent (later disclosed in emails) to improve the chances of his reelection. The discovery and publicity associated with stock futures buying policy (which began to be implemented in late summer, 2019) causes an uproar politically (as leaders of both parties are critical) and Congressional hearings are scheduled - sending markets abruptly lower as there was apparently less to the bull market run than meets the eye.

Though Republicans have a 53-47 majority in the Senate, Senator Susan Collins and four other Republican Senators demand the appearance of witnesses and more than 51 Senators vote to call witnesses in the impeachment hearings despite the threat of Executive Privilege by President Trump. The heated impeachment hearings (which includes Bolton's explosive testimony which is recounted vividly in his NY Times best selling book), are extended all the way into March, hurting Trump's popularity.

President Trump avoids being removed from office by impeachment by only one vote in the Senate

Consternation as to the President's rationale regarding the Iraq military base attack intensifies - further dampening the President's popularity. Over the past weekend in an interview on "Face The Nation", the Secretary of the Defense Mike Esper seemed to contradict the President's statement that there was an imminent threat to four American embassies, saying the justification for killing Soleimani was that it was "probably my expectation" that an attack was imminent. No wonder Republican Senator Mike Lee said Esper's briefing to Congress was insulting. Pushback that the Administration called for the killing of a foreign leader because it is "probably my expectation" draws increased alarm of both Democrats and Republicans and the voting electorate. Based on testimony and uncovered emails, the evidence mounts that the President's motivation for the attack was to distract attention from the impeachment trial and because some of the (Republican Senator) jurors in that trial pressured him to do so. (h/t Robert Hubbell) As written in a recent Wall Street Journal column, which chronicles the events leading up to the Iraq attack, the lede is buried deep (30 paragraphs into the analysis). "Mr. Trump, after the strike, told associates he was under pressure to deal with Gen. Soleimani from GOP senators he views as important supporters in his coming impeachment trial in the Senate, associates said."

The Supreme Court reviews Trump's assertion that the Supremacy Clause of the Constitution means he doesn't have to reveal his tax returns. After oral arguments are heard in March, the Court rejects the petition for a writ of certiorari and orders the release of the President's tax returns. The release of his tax returns clearly shows "questionable" transfers and a significant Russian involvement in his financial affairs (and in those of Jared Kushner and Ivanka Trump).

Jared Kushner and Ivanka Trump return to private life in New York City.

A Washington Post report discloses that Melania Trump and the President have essentially lived in separate quarters since late 2018. The Trumps separate.

Meanwhile, a slowing domestic economy and weakening stock market continue to adversely influence Trump's polling against the Democratic opponent.

Under the weight of the pressure of running for reelection, a hectic travelling schedule and poor eating habits, President Trump's health catches up to him. A significant health problem is disclosed in the spring forcing the President to curtail his political appearances for more than a month.

Faced with a unified and financially fortified Democratic Party, extended impeachment hearings, the release of Trump's tax returns, the stock futures controversy, Russian business disclosures (providing a large amount of loans to Trump and buying inflated homes and condominiums from The Trump Organization), health and marital problems, a weakening stock market and slowing domestic economy - Trump continues to suffer badly in the polls.

Attracted to her recent pro-Trump support which culminated last Monday in a charge that "leading Democrats were mourning the loss of Soleimani" (See Peggy Noonan's Wall Street Journal story this past weekend and desperate to revive his popularity, Trump dumps Vice President Michael Pence for former ambassador to the United Nations Nikki Haley. (PredictIt has a 90% probability that Pence will be Trump's running mate).

Voter Turnout Rises Dramatically and Biden Easily Wins the Presidential Election and the Democratic Party Sweeps the Congressional Elections
Voter Turnout rises by over +6% (from 2016) - most of the incremental change is captured by Biden who wins 50.7% of the popular vote compared with 46.3% for Trump - a plurality of over 6 million votes. (That compares to 48% for Secretary Clinton and 46% for President Trump in 2016 - a difference of 2.9 million votes).

Senator Biden also wins a surprisingly large majority in the electoral college (304 to 234).

Though the Republican Party was a huge favorite to retain control of the Senate - the Democrats regain control of the Senate on the coattails of Senator Biden and the widening voter turnout.

Upon winning in November, Biden makes first move and nominates Kamala Harris to the Supreme Court to replace Justice Ruth Bader Ginsberg (who agrees to step down). Stacey Abrams is enlisted to become Attorney General . Pete Buttigieg becomes Secretary of Veteran Affairs. Michael Bloomberg is named Secretary of the Treasury. And, in a move of bipartisanship, Senator Mitt Romney is nominated to the post of Secretary of State.

After the election, there are violent demonstrations around the country by Trump supporters in mid- to late- November. Trump does little to squash or calm down the protests and instead holds a number of rallies against Democrats and the election results.

In December, 2020, President Trump announces his plans to launch Trump TV. Sean Hannity leaves Fox News - assuming a duel role as CEO of Trump TV as well as the station's chief commentator. Rush Limbaugh and several Fox News commentators join Trump TV."

(in RealmoneyPro)
"Acreditar é possuir antes de ter..."

Ulisses Pereira

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