Waves and inverted curves

“For 2020 some have chosen to directly attack Trump as their centerpiece platform while others have chosen other targets to found their candidacy.

A presidential election year is just around the corner in the United States and as the Democratic primaries to pick a challenger to take on Donald Trump roll on, doomsday scenarios to show his economy isn’t really working are expected.

It’s campaign season and lies, fake news and anything divisive naturally take center stage. There’s a buffet table of divisive issues that those who seek the presidency can choose from. Every conceivable and edible issue for as long as it is hot and spicy enough and can be chewed on and spat out is on the boodle fight table.

Last weekend’s front-runners from the Democratic side of the aisle are led by four out of an original 20. Twenty-one if you include porn star lawyer Michael Avenatti. Former Vice President Joseph Biden has consistently led. While he is running on a platform based on the programs of the Obama administration, he has focused on health care as a central theme. It’s basically a subset of the economy. Elizabeth Warren focused on moderate socialism. The most radical economic program comes from Bernie Sanders whose far-left illusionary socialist propositions had attracted multitudes in the last Democratic presidential primaries.

For 2020 some have chosen to directly attack Trump as their centerpiece platform while others have chosen other targets to found their candidacy. It is open season and the years of demonization have borne fruits ripe for the picking. Kamala Harris, an attractive and very intelligent African-American woman who once inspired Democrats where she might overcome two deeply ingrained biases, one being a woman and the other being black, has chosen a purely anti-Trump position as her platform theme. This invariably includes the undeniably resplendent Trump economy which Trump is basically banking on to debunk all other issues hurled at him.

Let’s take a look at how her chosen tact has so far panned out.

Downward tracking on a free fall, her ratings are about a fifth of front runner Joe Biden’s who in turn has a sliver over a quarter of those polled. It’s an eloquent indicator of what the American electorate now thinks of her and her campaign tact. Behind the arithmetic’s veneer, it could mean the economy trumps both gender and racial concerns even where both have seen very visible resurgence in the last five years. To Harris’s dismay, as always, it is still the economy that matters to voters.

Recently among the issues prosecuted against Trump, the matter of the economy had suddenly taken the limelight more than the other divisive issues. That makes sense from a number of perspectives although when analyzed against economic forecasting methods the wisdom to use the economy as political ordnance may not be the wisest move after all.

Traditional linear economists like Nouriel Roubini and Thomas Friedman claim Trump’s economy is unsustainable and in that they align with the non-traditional cyclical and wave economists who’ve long predicted a massive recession due just about now through to the middle of the next decade. For once both the disciples of linear economic forecasting and the Elliot Wave theorists agree that the world, and the United States, is due for a recession.

Liberal left-wing politicians and the whole population of Democrats are not only in agreement as these recession scenarios chip away at the Trump narrative of a resplendent economy but the doomsday scenario they paint becomes a dispassionate techno babble-filled issue they can slap on Trump.

Wave forecasters see where recessions are preceded by an inverted yield curve. The benchmarks are bonds. Higher yielding 10-year treasury bills had just fallen.

But let’s look at the economy’s arithmetic. The numbers the electorate looks at and vote on remain good. For the poor, unemployment is at a 50-year low. For the rich, capital markets are near record highs. Black and Hispanic purchasing power are up 23.4 percent and 32.1 percent, respectively. That’s not politics. That’s good economics. And it’s prodded Friedman to exclaim, “Trump’s going to get reelected, isn’t he?”