Posted on 04/13/2020 7:40:08 AM PDT by SeekAndFind
Ron Farmer is a Houston-based serial entrepreneur of remarkable energy. Back in 2009, and when the U.S. economy was gasping for air after a 2008 political crack-up that subsequently led to financial and economic terror, I asked Farmer how he felt given the economys disastrous shape. Could we recover? His response was uplifting.
Paraphrasing Farmer only slightly, he quickly replied Are you kidding me? Im way too smart for Obama, and I was way too smart for Bush. Farmer didnt have time to be pessimistic. His belief in his ability to meet the needs of customers was powerful. Farmer was certain he would be able to work around existing and future governmental incompetence.
Ken Fisher has long said the same, albeit in a different way. Though a billionaire several times over today, Fisher hasnt forgotten when his eponymous firm was managing $250. Yes, thats 250 dollars.
Fishers lived through uncertainty about the viability of his creation, he knows from the early days what its like to stare potential failure in the face, and this may explain what hes long said about government: capitalists always outrun politicians. Entrepreneurs routinely overcome enormous obstacles to achievement including, but not limited to, near universal skepticism about what theyre trying to do. More important, they spend many nights worrying the next day will be the last for their business. All of this is very crucial in consideration of whats ahead.
To see why, lets first step back and remember why were here. Lets never forget that the new coronavirus was a known quantity going back to at least January, and it was a known quantity that the virus would eventually reach the freest, and easily one of the most open countries on the planet. Despite this, U.S. equity markets continued to rally to all-time highs.
Though the markets were actively pricing the coronavirus long before it was news in the U.S., surprise sometimes rears its ugly head. Theres arguably your market correction. Think about it. Big lurches in the equity space are never a consequence of the known, simply because equity markets are relentless price-processors of the known.
To understand the surprise, readers need only ask who among us was predicting in January and February that by mid-March, 20 to 25% of the worlds most dynamic economy would be on lockdown? Sorry, but no one predicted this, which has to help explain why stocks corrected so suddenly, and so brutally.
To be clear, the stock market and economy-crushing agony weve endured has been a surprise that could only have been created by politicians. Even though wealth creation has always been the greatest foe of viruses and diseases given the simple truth that those seeking health advances require copious resources to vaccinate away that which can kill, politicians quite literally responded to the coronavirus with forced unemployment and bankruptcy.
Politicians can asphyxiate production in lightning-quick fashion. Never forget that. That they can perhaps calls into question Fishers optimism about the ability of capitalists to outrun them? Its a fair question, but Fisher will be proven right. Bank on it.
For one, capitalists routinely overcome obstacles erected by others, along with ones of their own making. While errors in government are generally never fixed as a consequence of government enjoying privileged access to the production of others, in the profit-motivated world entrepreneurs must realize their mistakes, and correct them quickly. Unlike government, entrepreneurs can only innovate as long as they have investors willing to let them. This relentless pressure forces constant improvement.
For two, entrepreneurs are battle-hardened. Most successful entrepreneurs can remember many days, years, and even decades of wondering whether their creation would last. Awful, incompetent and inexcusable as the actions of politicians have been, they wont break the spirit of individuals for whom looming failure is the constant rule to the success exception. Consider Blackstone co-founder Stephen Schwarzman. In the early days of what is now a global financial behemoth, Schwarzman was turned down 17 times for every yes he received when the former M&A investment banker had the temerity to try and raise a billion dollar private equity fund, despite no background in private equity. In his spectacular memoir, Schwarzman recalls how he began to feel dizzy one night as he sat alone with his thoughts, worried that he was failing on every count.
In his similarly spectacular memoir, CAA co-founder Michael Ovitz recalls the folding chairs and card tables for desks that were the nascent talent agencys office furniture when CAA opened its doors in 1975 in a bargain bin building on the very edge of Beverly Hills. And even when it became more apparent that CAA might survive the relentless attempts by global agency William Morris to vanquish the agenting upstart, the brilliant Ovitz writes that there wasnt a day when I didnt walk in the door and get hit by a rush of anxiety. What idea can I come up with today to pay the overhead?
Nike co-founder Phil Knight spent many, many years up late at night, wondering if the next day would be Nikes last. He didnt even pay himself a salary until Nikes eighth year, but long after that he recalls reassuring his wife Penny nearly every night about Nikes ongoing viability with optimistic words that I didnt wholly believe.
These stories are a reminder that whatever needless barriers politicians can and will - throw in the way of Americas entrepreneurs, theyve seen and overcome much worse. Reprehensible as the latest economy-suffocating political crack-up has been, entrepreneurs will figure out a way. They always do, and when they do, the worlds most dynamic economy will attain levels of progress that will make the past look primitive by comparison.
Don't worry politicians with "plans," the actual creators of economic growth are way too smart for you. They'll bail you out again.
If we can get opened up very soon it will. If not, it won’t.
“The U.S. Economy Will Come Roaring Back, Despite Plans of Politicians”
Everyone wants that. Some just want to wait until after they manage to force Trump out of office.
The “experts” make up stuff most of the time : )
BTW my AMD stock went from about $59 in Feb to a bit more then $37 at it’s low. Now today at $49.66 up 1.33 so far. Last friday it hit a high of $50.25
People want to make money despite what the democrat party wants.
Then I thought maybe I was smart.
Then I concluded I was a genius.
Now I realise it's just that I'm psychic.
When I place my index finger upon the ajni chakra a vision appears:
It's autumn 2020:
Donald Trump is re-elected to the US Presidency in a landslide victory!The US economy soars and roars through the stratosphere, bringing the rest of the world's economies with it!
All benevolent people rejoice and the heavenly angels sing hallelujahs as God sheds His grace on America yet again and through America on all the world!
The world gives thanks!
President Donald Trump, on bended knee, thanks God, yet again, for guiding him as he, in turn, has guided the USA.
I hope Trump shifts focus at these pressers to reopening the country. Fauci had his 15 minutes.
The doctrine of productionism states that because of the faculty of reason man is different in kind from other animals, and so has unlimited needs and desires for more wealth. So the main problem of a free rational society is how to produce more wealth. As long as government keeps interventionism to a minimum, capitalists will begin to start trying to satisfy those unlimited needs and desires for goods and services, and increase production and supply again.
Very nice editorial and true! Well done. A positive attitude and preparations to meet the changes will get us through.
“The U.S. Economy Will Come Roaring Back, Despite Plans of Politicians”
About time somebody state this. To much gloom and doom. The Economy is not completely shut down because of the Flu or the Cornovirus.
I know a lot of people still working. It is mostly restaurants shut down, even those have take out.
Kohl’s shut down, now they reopen with pick up service for items purchase on line.
If your AC breaks you can still get your AC fix.
Just mostly mom/pa retail type business and big retailer stores.
Point is, there is still a lot of things running during stay at home.. Factories, the factories around here are waiting on parts from China.
I believe Fauci said it shouldn’t open until there are no new cases and no deaths.
I don't think the NFL should open until they can pledge no player will get injured.
(MAGA)X10
I don’t think the NFL should open until no one is arrested during an entire season.
I also believe the economy will rebound quickly and completely. Remember how quickly it came back after 8 years of bammy and his cohorts in crime doing everything they could to flatten it and make everyone dependent upon the government? Now it is starting from a much better regulatory position, with recent memory of how good things were. People can’t wait to get back to “open for business”... Start small, maybe even as soon as later this week in some places. Within a couple of weeks most activities in most places can and should be back to normal. By mid May only big city hotspots should still be taking any significant measures. I predict a heck of a summer travel season starting in June/July as people can’t wait to GTFO.
I'll do you one better, I don't think The House should convene until they stop committing crimes.
I wish I was smart enough to read this and get on with the day. But I will be weak and read a whole slew of different perspectives and start wondering again ...
what is RCM?
Well except for the thousands of small mom and pops like Mickey Pigs BBQ that has been around since I can remember and has gone under from being forcibly closed past its cash flow ability. We will see how fast things come back.
beware those that call the bottom who didn’t see the crash coming in the first place... ..
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