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REAGAN, TRUMP, DEBT AND DEBT'S CONSEQUENCES

|Includes: Diana Shipping, Inc. (DSX), SGG

REAGAN. TRUMP AND DEBT

Dec. 22, 2016 11:47 PM ET•DSX, SGGComment!

Disclosure: I am/we are long SGG.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

Gary Gordon is leading a very interesting SA discussion on REAGAN, TRUMP AND DEBT on the following site:

seekingalpha.com/article/4032309-debt-le...

I replied to this article:

Reagan and Trump are alike in that they (this is my view) represent the GROWTH PRINCIPLE returning after the requisite 18 years of REST.

REST: 1965-1983

Reagan and GROWTH: 1983-2001

REST: 2001-2019
Trump and GROWTH: 2019-2037

Rest is what I call the Motherland -- predominantly Democratic values. REST is Spiritual Growth (and Physical/Material entropy). IDEALISM in ascendancy. The Fatherland is predominantly Republican worldly views and goals leading to Material Growth. PRAGMATISM is retaliatory ascendancy. Material Growth IS Spiritual Entropy. Fatherland is Left Brain; Motherland is Right Brain. However, the Democrats were supposed to "punish us" with depression and DEBT REDUCTION from 2001-2019. They did not -- thanks to the FED's creativity. So now we approach a cyclical GROWTH SEASON (or BUSINESS CYCLE) without having done the requisite preliminary work-- reduction of a mountain of debt. It's like trying to fly with a bank vault strapped to your back.

Should 'have begun raising rates in 2001 to discourage and punish debt. Did not. So we're still on the CUSP of that Depression, like we were in 2001, when the expansion ended. Instead of learning from and re-living history, we stole money from unborn Americans to keep the peace, to keep the darkness at bay. Now we have to get rid of even more debt.

By my calculations our total debt to GDP (390% now?) has to come down to about 130% before we reach DEBT GROUND ZERO, get to pass GO and collect $200.The Female Principle, the Democrats, and Depression (the REST SEASON) are supposed to go together. We learned how to cheat history. Now we have to pay for it....

I think you can argue that the FED had its own reasons for lowering rates after the expansion ended (2001) -- such as a desire to avoid an economic depression -- but it's hard to argue that the FED isn't responsible for higher debt levels. Lowering rates was done to protect debtors and creditors from massive debt insolvency. The FED's goal was to protect debt and encourage MORE debt -- the FED rewarded indebtedness.

Now the question is: do we still have to have that depression anyway, to get rid of the mountain of debt -- and did the FED waste trillions just to buy a few years in the process? If we can GROW our way out of this mess, then we will have found a way to eliminate depression from the economic quotient. Just spend like drunken sailors every time the Business Cycle expires (...1929, 1965, 2001, 2037...).

My perspective is that the FED spent TRILLIONS to delay global economic depression and this is something that we will have to face in the near future as interest rates are finally allowed to rise again.

The FED spent trillions to buy bonds to keep interest rates near zero thinking this would 1) solve the global debt problem; 2) buy time until GROWTH could return and mitigate global debt problems; 3) buy time because they did not know what else to do and did not want to face massive global economic deconstruction now -- wanting to face it later, no matter what the cost?

Today was another day of selling on Wall Street. Stocks are grinding lower -- indexes are grinding higher. TRENDS were -17 on the day; -61 on the half-week. TEMPERATURES are still warm: 77.83° for PROP1, 66.52° for PROP2. We expect to see PROP2 below 50 in a real correction -- and ST TREND below 40% so we are not there yet. We are now also looking at our PROP2 AVG10 in terms of the number of issues climbing versus the number of issues falling. Only 28% of our issues are rising. We will start collecting this data since we think it could be interesting in marking trading bottoms. We will see about this.

Our report:

12/22/16            
             
CURRENCY 1            
        NEW POS NEW POS  
SYMBOL CLOSE PROP POSITION TODAY YESTERDAY ISSUE
             
EURARS=X 16.393 -5 Long Enter Long   Euro/Argentine Peso
EURCHF=X 1.07 -1 Long Enter Long   Euro/Swiss Franc
FXB 119.88 -23 Flat   Exit Short British Pound ETF
GBPINR=X 83.309 -25 Flat     Great British Pound/Indian Rupee
             
CURRENCY 2            
        NEW POS NEW POS  
SYMBOL CLOSE PROP POSITION TODAY YESTERDAY ISSUE
             
EURARS=X 16.393 -5 Flat     Euro/Argentine Peso
             
             
CURRENCY 3b            
        NEW POS NEW POS  
SYMBOL CLOSE PROP POSITION TODAY YESTERDAY ISSUE
             
AUDJPY=X 84.776 -1 Flat     Australian Dollar/Japanese Yen
CADJPY=X 87.102 -1 Flat Exit Long   Canadian Dollar/Japanese Yen
GBPJPY=X 144.416 -1 Flat   Exit Long British Pound/Japanese Yen
NZDJPY=X 81.131 -1 Flat     New Zealand Dollar/Japanese Yen
USDARS=X 15.709 -3 Flat   Exit Long US Dollar/Argentine Peso
EURARS=X 16.393 -5 Long   Enter Long Euro/Argentine Peso
             
             
TRUMPET 1            
        NEW POS NEW POS  
SYMBOL CLOSE PROP POSITION TODAY YESTERDAY ISSUE
             
DUST 67 23 Flat   Exit Long * Gold Miners Bearish ETF 3x (NYSE:O)
JNUG 4.13 -25 Flat   Exit Short * Junior Gold Miners Bullish ETF 3x
YANG 17.316 -15 Flat   Exit Long * China Stock Bearish ETF 3x
YINN 14.69 -5 Flat   Exit Short * China Stock Bullish ETF 3x
             
TRUMPET 2            
             
        NEW POS NEW POS  
SYMBOL CLOSE PROP POSITION TODAY YESTERDAY ISSUE
             
             
             
CURE 27.98 3 Flat   Exit Long * Healthcare Stocks Bullish ETF 3x
             
             
TRUMPET 4            
             
        NEW POS NEW POS  
SYMBOL CLOSE PROP POSITION TODAY YESTERDAY ISSUE
             
AXPW 0.021 -19 Short     AXION
AHGP 28.23 -7 Flat     Alliance Holdings Mining
AXON 12.13 -7 Flat   Exit Long Axovant
CLMT 4.175 -5 Flat   Exit Long Calumet Speciality
CTIC 0.405 -5 Flat   Exit Long Cell Therapeutics
DGAZ 3.62 -25 Flat   Exit Long * Natural Gas Bearish ETF 3x (NO)
DSX 3.41 3 Flat Exit Short   Diana Shipping
ESSI 2.21 -1 Flat   Exit Short Eco-Science Solutions (NO)
FINL 19.84 -5 Flat Exit Long   Finish Line
FMCC 3.76 1 Flat     Freddie Mac Daily
FNMA 3.93 1 Flat     Fannie Mae Daily
GASL 46.895 -3 Flat Exit Long   * Natural Gas Stocks Bullish ETF 3x
GASX 21.98 -19 Flat Exit Short   * Natural Gas Stocks Bearish ETF 3x
KSS 49.98 -7 Flat Exit Long   Kohl's Corp
MT 7.37 -5 Flat Exit Long   Arcelor-Mittal Steel
NAO 2.875 -23 Flat Exit Long   Nordic American Offshore
RETL 38.569 -5 Flat Exit Long   * Retail Stocks Bullish ETF 3x
SWN 11.06 -25 Flat     Southwestern Energy Corp
VALE 7.79 -5 Flat     VALE S.A.
CENX 9.265 -7 Long     Century Aluminum
DRYS 4.5 -7 Long     Dry Ships Daily
SGYP 4.735 -7 Long     Synergy Pharma
             
TRUMPET 8            
             
        NEW POS NEW POS  
SYMBOL CLOSE PROP POSITION TODAY YESTERDAY ISSUE
             
CENX 9.58 -5 Long   Enter Long Century Aluminum
CLR 51.58 -5 Long   Enter Long Continental Resources
CYTX 1.545 -19 Short   Enter Short Cytori Therapeutics
DAKP 0.017 -25 Short   Enter Short Dakota Plains Holdings
DRYS 4.845 -7 Long Enter Long   Dry Ships Daily
JEC 58.55 -5 Long Enter Long   Jacobs Engineering Group
SGYP 4.84 -7 Long     Synergy Pharma
             
TRUMPET 3            
             
        NEW POS NEW POS  
SYMBOL CLOSE PROP POSITION TODAY YESTERDAY ISSUE
             
BYD 20.645 -1 Flat     Boyd Gaming
CLB 119.14 -1 Flat     Core Labs
DBO 9.47 -1 Flat   Exit Long OIL POWERSHARES DB
ELNK 5.51 -5 Flat   Exit Long Earthlink Inc
ESSI 2.21 -1 Flat   Exit Short Eco-Science Solutions (NO)
HURN 52.1 -5 Flat     Huron Consulting
JPNL 44.744 -3 Flat     * Japan Stocks Bullish ETF 3x
KORU 23.241 5 Flat     * South Korean Stocks Bullish ETF 3x (NO)
LNG 41.185 -1 Flat     Cheniere Energy
NFX 42.5 -5 Flat     Newfield Explorations
NSR 33.275 5 Flat     NeuStar
P 13.135 -1 Flat   Exit Long Pandora
PBR 9.89 -5 Flat     Petrobas Petroleum Brasil
TECS 17.025 -25 Flat     * Technology Stock Bearish ETF 3 x
UHN 16.385 -1 Flat   Exit Long Heating Oil ETF
URA 13.69 -1 Flat   Exit Long Uranium ETF
WIN 7.495 -1 Flat Exit Long   Windstream
CENX 9.265 -7 Long     Century Aluminum
DRYS 4.5 -7 Long     Dry Ships Daily
DSX 3.41 3 Long     Diana Shipping
             
TRUMPET 3b            
             
        NEW POS NEW POS  
SYMBOL CLOSE PROP POSITION TODAY YESTERDAY ISSUE
             
CENX 9.265 -7 Flat     Century Aluminum
CYOU 21.8 -1 Flat   Exit Short Changyou.com LTD
CZR 7.2 -5 Flat Exit Long   Caesar's Entertainment
DGAZ 3.62 -25 Flat   Exit Long * Natural Gas Bearish ETF 3x (NO)
ESSI 2.21 -1 Flat   Exit Short Eco-Science Solutions (NO)
HSIC 152.28 3 Flat     Henry Schein
IEP 62.54 1 Flat     Icahn Enterprises MLP
LL 16.4 -7 Flat     Lumber Liquidators
MDRX 10.495 -23 Flat     ALLSCRIPTS HEALTH SOLUTIONS
MIDZ 21.68 -19 Flat   Exit Short * Midcap Stock Bearish ETF 3x
SGG 39.824 -1 Flat Exit Short   Sugar ETF
SMDD 16.479 -19 Flat   Exit Short * Midcap 400 Bearish ETF 3x
SRTY 13.03 -19 Flat     * Russell 2000 Bearish ETF 3x
TNGO 8 -1 Flat     Tangoe
TRN 28.37 -1 Flat   Exit Long Trinity Industries
TWM 23.62 -19 Flat     Short Russell 2000 Index ETF Daily
UGAZ 40.16 11 Flat   Exit Short * Natural Gas Bullish ETF 3x (NO)
DRYS 4.5 -7 Long     Dry Ships Daily
DSX 3.41 3 Long     Diana Shipping

Here are some pictures from tonight's signals. We have a new Trumpet 3 BUY SIGNAL, DSX, Diana Shipping.

We have quite a few Trumpet 3 SELL SIGNALS.

Our Trumpet 3b is giving a COVER signal on one of our favorite stocks -- indicating we may be at a trading bottom. We also include a monthly chart of SGG, showing why we like this issue, expecting another move higher. The monthly chart shows SGG has traded as high as 100 in the past.

Our last chart is UDOW. We do not think this is a major correction -- as we look at the UDOW chart. Things can change. At the moment, stocks appear to be resting.

Have a good holiday. Good weather; good health.

MJC, CGTS

Disclosure: I am/we are long SGG.