Chairlift Conversations: Politics and Stunning Views

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Macro Snapshot/Current News

The Press Conference

From high society to the ski slopes, this week's only topic was the wretched press conference with Zelenskyy.

Here’s the range of reactions:

• Trump and Vance were bullies acting deplorably, telling Putin’s lies about who started the war

• Zelensky was disrespectful and acted foolishly. He should have just made nice, signed the minerals agreement, and gone to lunch

Zelensky should have shown up in a suit and tie and let the press corps ask whatever (planted) questions they wanted without taking the bait.

As appalled as most of the pundits were at this sh*t show, the American public was evenly divided about the outcome.

Do we have a Manchurian Candidate in the Oval Office, doing Putin's bidding? Or do we have a new-age realpolitik President prepared to say uncomfortable things out loud?

Zelensky is now prepared to sign the agreement at any point convenient to President Trump. The following keeps happening:

Image Courtesy of David Blackmon

Presidential Joint Address

This address (not State of the Union) was nearly 100 minutes long. I find it easier to watch the President at 2x speed.

Here are the takeaways:

• America is back, and we are about to witness a new Golden Age

• Joe Biden was probably the worst President ever

• Elizabeth Warren (calling her by his favorite pet name, Pocahontas) might want to continue the war in Ukraine for another five years - but he intends to end it

• While Democrats said they needed legislation to seal the border, it turned out that we just needed a new president

• DEI and woke is gone; men are men, and women are women, good just the way God made them

• English is the official language of the U.S.

• The Gulf of Mexico is now the Gulf of America

• We are getting Greenland one way or another…

• The Panama Canal was given to Panama, not China - we are taking that too

• Law enforcement needs all the support it can get (including, presumably, some help from the pardoned and released January 6th rioters…)

• The tyranny of unelected bureaucrats is over…but Elon is doing a great job

• Taxes are going down, and the green new scam is over

• We are going to be protected by a Golden Dome - sounds a lot like Ronald Reagan’s Star Wars

• Many Democrats wore pink and held up protest signs like paddles at an auction

• He believes God saved him in Butler, Pennsylvania to make America great again.

• And he promised to balance the budget.

In The Markets

Markets are getting bumpy

We will need to get used to this. When Joe Biden ran for office in 2020, one of his promises was to keep the Presidency off the front page of the news. He said people were tired of the drama. In this, he succeeded (mostly).

Donald Trump will never be far from the front page, and some of the things he does will feel like:

Here’s what that looks like in a chart:

VIX (stock market volatility index), MOVE (bond market volatility index) are as high as they have been all year.

Credit spreads are beginning to march higher.

Technical Analysis

Some of you may remember that I set out to explore the world of technical analysis a few months ago.

Charts map the past. They don’t predict the future. Their value consists in pattern recognition. They are all about price and volume. Price contains the wisdom of millions of trades: buyers and sellers expressing their opinions on the value of everything being traded.

Here’s what I’ve learned so far:

1. Interactive Brokers has a decent charting capability - I’m still exploring

2. Trading View has a fantastic charting capability

3. Charting is a great way to compare how securities perform over given periods in varying economic circumstances

4. There may be multiple ways to get exposure to a particular risk - charts allow you to compare how different securities offering that risk perform relative to each other

5. There are many indicators designed to help you weigh the performance factors and see how the voting machine is working - I will focus on one.

MACD

Moving Average Convergence Divergence is one of the most popular charting tools.

MACD employs two moving averages of varying lengths to identify trend direction and duration. Then, MACD takes the difference in values between those two moving averages (MACD Line) and a moving average of those moving averages (Signal Line) and plots that difference between the two lines as a histogram, which oscillates above and below a center Zero Line. The histogram is used as a good indication of a security's momentum.

The above shows two securities, two ETFs, one based in London, the other in New York. Both aim to expose the investor to downturns in the NASDAQ, leveraged/amplified 3x. Both are intended to hedge the NASDAQ.

The first challenge is to remember which line is which. Try this: “B(ig)Mac” stands for Blue line—that’s the MACD Line. When it crosses the orange signal line going up, it is bullish. It is a measure of positive momentum.

Traders and investors seem to like this. Moving averages smooth price charts and the methodology of the MACD is a good signal of buy-sell momentum. I watch it a lot.

Must-Read Piece(s) on Today’s Market

I am linking just one article this week because it is long. Victor Davis Hanson of The Free Press does a great job of breaking down what is at the root of the current administration’s policy.

For those with staying power or a good AI tool, enjoy!

Victor Davis Hanson: Can Trump Revolutionize America?

And, of course, if you are itching to see the entire Joint Address, here it is. Remember, 2x is the max!

On The Horizon

• Congress must vote to avoid a government shutdown by March 14th

• Greenland holds elections

• The market begins to wonder about the FOMC meeting on March 18th - interest rate cuts are now very much on the table because of this chart from the Atlanta Fed showing the economy cooling rapidly (thank you DOGE…)

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