Issues, News and Views


Sworn In
April 10, 2017

A Tremendous Day for
sound jurisprudence and
our Constitution!

Watch the swearing-in
and savor the prospect of
a Supreme Court Justice
who will defend our

Below is our rating of
Supreme Court justices
based upon judgement of
their fidelity to the

As the chart illustrates,
there are too many rogue
justices on the Supreme
Court. These appointed,
life-term judges take it
upon themselves to
arbitrarily unilaterally and
autocratically over-rule the
will of the people. They are
the equivalent of tyrants.

It is crucial to our
Democracy to fill all open
seats on all Courts, as
they arise, with true-to-
the-law judges. With
originalist, textualist
judges who apply the law
as passed by the
representatives of the

It is NOT the role of judges
to over-rule laws they just
happen to dislike. As
Gorsuch said at the

"A judge who likes every
outcome he reaches is
very likely a bad judge..."

April 07, 2017

A Supreme Court seat
opened with the passing of
Antonin Scalia just months
before the 2016 election.

President Obama
nominated Merrick Garland
as a replacement, but
Senate Majority Leader
Mitch McConnell (R-KY)
blocked the nomination,
claiming that the voters
should decide.

Elections have
consequences. Democrats
were certain they would
hold the White House and
regain the Senate in 2016,
thereby giving them full
control of the nomination

But the GOP held the
Senate, and won the
White House, against
all predictions.
Republicans campaigned
on the Supreme Court
issue, and won.

And that's why Democrats
lost the Supreme Court
nomination: because they
didn't win the election. The
people spoke. As it should

January 31, 2017

President Trump has
nominated Neil Gorsuch to
the United States Supreme
Court. View the
proceedings at the White

As the President so
appropriately remarked at
the nomination ceremony:

"I have always felt that
after the defense of our
nation, the most important
decision a president of the
United States can make is
the appointment of a
Supreme Court justice.
Depending on their age, a
justice can be active for 50
years and his or her
decisions can last a
century or more and can
often be permanent."

We anticipate that Neil
Gorsuch will be an
outstanding Supreme
Court Justice, just like
Antonin Scalia, the great
man he will replace.

Neil Gorsuch: a judge who
understands both what a
judge's role is; and what a
judge's role is not.


2018/07/26 - Herewith we present our semi-annual review of and prognostication for the United States economy as well as geopolitical implications of and for the world around us.

Let's get this out of the way first: The economy is very strong. The economy grew at an annualized rate of 4.1% in the second quarter even with a 1% drawdown in inventories. If inventories had been neutral we would have seen 5.1% growth. We can expect a bit of a snap back in the third quarter which should provide economic tailwinds.

Other indicators of underlying economic activity continues to look strong in July as well: Factory Orders, Independent Business (NIFB), Purchasing Managers (PMI) and Supply Management (ISM) surveys all look good, as well as the regional Fed surveys - Atlanta, Empire, Philly, Chicago and Richmond all meeting or beating already solid expectations.

And the job data looks good too: continued job creation north of 200,000 per month, weekly jobless claims hovering at historic lows, more job openings than job seekers, and rising wages.

And that's where we being to see issues: rising wages, rising interest rates, and rising prices, especially oil prices.

There was no escape from Stalag 13, and there is no escape from the law of supply and demand. Whether you look at demand for workers, for money, or for oil, eventually demand can exceed supply and that sows the seeds of recession. The economy gets a head of its skis, and needs to slow down - a deceleration - or else it does what in technical economic terms is referred to as a "face-plant", or more colloquially amongst layman, a recession.

The Second Quarter GDP update reported a price index increase of 3%, Employment Situation reported wage increases of near 3%, the Philly Fed in its survey reported rising producer costs, oil blowing through $70/bbl, and of course tariffs on imported goods - all these statistics and factors telling a story hinting at inflation.

We are not predicting recession or runaway inflation - at least not yet. But it does seem that we are rather close to a tipping point.

Rather, we are imploring Federal officeholders and policymakers to cut government spending. The combination of an overheating economy and excessive deficits and debt make now the best opportunity ever to cut spending and reassert fiscal discipline that was lost in 2008 when the Democrats took control of the White House and Congress. But it's an election year so don't bet on even Republicans never mind Democrats showing any kind of fiscal spine.

The price of oil has been rising steadily for the past year, from $45 to $70/bbl. High oil prices almost always presage a recession. How high is too high? It's hard to tell, but $75/bbl is probably getting kind of warm. Some prognosticators - possibly just talking their book - are talking $100 oil, and that would definitely be a danger signal.

What about the global economy? It was interesting to see China report a decline in industrial production. Last week the June production was just a 0.36% increase over May, bringing the 12-month Year-over-Year down from 6.8% to 6.0%. Was that a one-month wonder, or part of the trade spat with the USA, or part of a larger cyclical decline? Too early to tell. But it's something to keep an eye on.

Also of note is the price of copper. We saw copper spike earlier in the year due at least in part on labor unrest in Chile, but hit 1-year lows last week at about $2.67/lb, down from $3.27 only six weeks ago, a plunge of nearly 20%. Is this a one-month wonder, or indicative of sagging global demand? It's too early to tell.

But on the other hand there is the Baltic Dry Index, the spot shipping rate for dry bulk materials. It hit 4-year highs last quarter above 1700 - is that indicative of growing global trade, or more likely, a rush to ship whatever wherever before tariffs kick in, followed by a plunge? Again, it's something to keep an eye on.

Tariffs are not something we have talked a lot about over the past few years, but that issued suddenly flared up over the winter just as we issued our last semi-annual review.

Chalprem is an advocate for free trade, and for fair trade. China has been conducting a trade war against us, and we have gone too long without responding. Good that we have a President with a spine, too bad Obama didn't have one, and that Bush was obsessed with Al Qaeda and not able to walk and chew gum at the same time.

We support President Trump's attempts to expand and improve trade, because that is in fact what he is doing. Tariffs are not the end, they are the means to an end. The beach is the objective, the highway is how you get there. Nobody goes on a highway to indulge their love of asphalt. You use a highway to get to the beach, you impose tariffs to get other nations' attention and get them to the bargaining table.

It is unfortunate to see so many commentators criticizing Trump on trade. None of these critics make substantive arguments against Trump's position that we are being cheated; nor do any of them offer constructive suggestions on how to achieve more fairness and freedom in trade. All they do is make personal attacks on the President.

But the best thing to do is to ignore the specious comments from the leftist media that reflexively opposes anything Trump - if 45 says the sky is blue, our media calls the President names and insists the sky is green.

Now, the question truly is, how far will China go to advance their predatory mercantilist "we-win/you-lose" trade agenda? Will they accept a "win/win" arrangement, because that is what President Trump is insisting upon. Are the Chinese willing to pull back, or are they willing to risk a two-way "lose/lose" trade war?

President Trump has made clear to President Xi that the USA will no longer accept a "we-lose/you-win" arrangement, and China's response has mostly been "Oh yes you will". And that is the black swan that faces markets and the economy over the next six months. Will Trump offer a face-saving opportunity to China, or does China even want one?

China is not as invulnerable as our leftists would like to make it seem. They have their issues with debt, unemployment, social unrest, regime opposition, and so forth. You hear that China will bury us because they graduate so many engineers; but then you also hear that so many of them cannot find employment. But don't expect to find a statistic on that coming from the Communist government.

Also, while there may seem to be a calm with North Korea, it may be the calm before the storm. Chalprem expects neither side to be honest about their true intentions, and it would surprise us not if invasion arrangements are being finalized even as the tariff smokescreen smolders.

But for the time being the issue to watch is China and its response to open up on trade - will they come clean, or will they continue to their trade war? Will the EU and the US resolve their differences and stand united against Chinese cheating?

We shall see...


August 17, 2018 - The price of oil continues its slide, coming to a rest at in the $65's this afternoon.

Baker-Hughes this afternoon reported a US oil rig count of 869 versus 858 this time last month, while the EIA earlier this week reported US oil production of about 10.9 million barrels per day, down slightly from the 11 million levels we were seeing last month.

But the stat that has captured the focus of oil traders is inventories - the EIA reported a climb of about 7 million barrels to the highest levels of the summer.

Rising inventories coupled with easing production implies a weakening of demand and consumption; and increasing rig counts could in turn reaccelerate production in the coming weeks, suggesting further inventory build and price decreases to come.

August 16, 2018 - The Philadelphia Fed released its business outlook survey this morning and the report came out much weaker than expected.

New orders were down substantially - is this just a random variation and nothing more, or the canary in the coal mine that presages a slowing in the economy?

Granted, most of the economic data - productivity, leading indicators, jobless claims, etc. - have been solid to strong. But the "synchronized global growth" story withered on the vine quite a while ago, and more and more, the US is an island of economic growth unto itself.

Keep an eye on commodities - oil and copper are sliding, while the dollar rises. This is what you expect to see in a slowing global economy where the US is seen as a safe haven. For now.

August 10, 2018 - The Treasury Departments released its Monthly Treasury Statement this afternoon and is it ugly.

Our - yes, you and me - our 12-month spending deficit increased from $749.9 billion at the end of June to $783.8 billion at the end of July, a deterioration of $33.9 billion.

Disingenuous dishonest Democrats will blame the tax cuts, but the revenue decline contributed only $6.8 billion to the deterioration, the increase in spending contributed $27.1 billion.

You can blame the $1.3 trillion spending package passed by Congress earlier this year. You can blame the RINO Republicans who claim to be fiscally responsible but spend worse than drunken sailors.

Blame RINO Congressmen like John Faso (R-NY19) who voted in favor of the obscene spending package. Oh, and against the tax cuts. Votes for spending increases, and against tax cuts. A true Democrat, with an "R" behind his name.

August 09, 2018 - A few years ago New York Governor Andrew Cuomo railed against conservatives, saying that pro-life/pro-2A people had no place in New York.

Now upstate Congressman Sean Patrick Maloney (D-NY18), running to replace the humiliated former Attorney General Eric Schneiderman, has decided to take that page out of Cuomo's playbook - that you win statewide office in New York by saying the meanest, stupidest things.

In a rant yesterday he used the "f-word", the "a-word", and threatened to use a baseball bat against some ambiguously defined Trump supporters that he could conveniently define as broadly or narrowly as circumstances demand.

The diatribe was clearly intended to excite the far left nut jobs that he needs to rally to his side, and he made clear there is a wide swath of the state's population he abhors, namely, Hilary's deplorables. Yet with plausible deniability.

And this is a guy running for Attorney General. Nice to know we have such a level-headed fair-minded person looking to take the job. Looks like we can add this sleazy guy to our Attorney General Hall of Shame.

August 07, 2018 - The Bureau of Labor Statistics (BLS) released its Job Openings and Labor Turnover Status (JOLTS) report this morning, and the results were much the same as recent months.

Basically, there are far more job openings in America than there are job seekers by over a million. The BLS says there are 6.662 million openings, versus 5.651 million job seekers.

Things that make you say, "Hmmm...". Anyone who wants a job should be able to get one. So why do we still have people wandering the sidewalks and subways shaking folks down for money? Why do we have so many people on food stamps?

Why can't people just stay in school, graduate, and get a job? It's not supposed to be difficult or complicated, just something any responsible citizen can and should do.

Why are people so needy and dependent, when there is so much opportunity? Hmmm...

August 02, 2018 - Is job creation slowing? Maybe just a bit, and given some of the scorching hot reports recently, maybe that's not a bad thing.

The federal government's Bureau of Labor Statistics reports that 157,000 jobs were created in July, down from recent prints well above 200K.

On the plus side, private payrolls were up by 170,000 which means that non-private - that is, government - payrolls were down by the difference, 13,000. Now that is a cause to celebrate!

Pretty well every metric was flat - the unemployment rate dropped a tick to 3.9%, while the participation rate was unchanged at 62.9%, year-on-year wages remained unchanged at +2.7%, and the average workweek was unchanged at 34.5 hours.

So basically kind of an unmotivated ho-hum shoulder-shrugger of a report, maybe just about right for a lazy Friday afternoon in August...

July 27, 2018 - Make America Great Again!

The Federal Government released the Second Quarter GDP this morning and the news is great - the economy grew at an annualized rate of 4.1%!

Almost every segment of the print was strong - consumer spending, net exports, business investment.

And the one weakness was the change in inventories, which subtracted 1% from the total or else we would be looking at 5.1%!

Of course, inventory drawdowns need to be restocked, so we could very well see that 1% come back in the third quarter - setting up for a potentially stunning release slated for October 26.

There were two downsides in the report, however.

First, the GDP price index increased 3%, a figure much higher than we'd like to see.

Second, and worse, the government sector added 0.4% to the increase in GDP. When will governments reduce spending? The government sector is too big, and needs to shrink.

July 20, 2018 - It appears that oil prices may finally have hit a bit of a wall after climbing into the low $70's earlier this month.

This week's supply estimate from the US Energy Information Administration (EIA) showed daily production hit 11 million barrel per day for the first time ever. And inventories were up about 1.5% on the week.

Meanwhile, the oilfield services provider Baker-Hughes has released their rig count report and the numbers are pretty much in line with recent trends of continued modest growth.

Including Gulf rigs, the total North American count is up 6 for the week and approximately 100 higher than same time last year.

The US rig count was relatively flat, declining by 8 to 1,046, while the Canadian count increase by 14 to 211, reflective of the summer ramp-up after the mud-season shut-down.

Unfortunately US production seems constrained by supply chain issues - lack of railway and pipeline capacity - but Canada still has capacity for increased production and distribution to keep the market supplied.

July 12, 2018 - This afternoon the United States Treasury released its Monthly Treasury Statement and the news is pretty good for a change.

Federal government receipts declined in June year over year by about $22 Billion, but expenditures declined by $37 Billion, so our rolling 12-month deficit declined by about $15 Billion.

But the deficit is still far too high. Over the past twelve months we have spent about $750 Billion more than we've taken in. Not good.

Chalprem is an advocate for limited government, low taxes, low spending, low deficits, low debt. In other words, fiscal discipline. Limited government means more freedom.

We would like to see this Administration get serious about cutting the size, scope and scale of government and government spending.

July 10, 2018 - This morning the Bureau of Labor Statistics released the second of its two major monthly reports and the news continues to be good for job seekers.

The JOLTS report - Job Openings and Labor Turnover Survey - for May indicated there are 6.638 million job openings in the US.

This continues the string of now five straight months above 6 million, and the eleventh time during Donald Trump's presidency. Prior to Donald Trump there had never been 6 million job openings!

In fact, last Friday's employment situation indicated that there are only 5.574 million people looking for work - there are more jobs than there are unemployed!

Think about it... there are more job openings than there are people looking for work. That never happened in 20 years of data. Until President Trump. MAGA.

July 06, 2018 - Today's Employment Situation report released by the Bureau of Labor Statistics continues to paint a rosy picture.

The Bureau reports that 213,000 new jobs were created in June, and this is in addition to a 21,000 upward revision to the prior month's report.

The Unemployment rate actually increased from 3.8% to 4.0%, but this is actually a situation where bad news is good news - the report also shows an increase in the labor participation rate from 62.7% to 62.9%.

Don't underestimate the importance of the participation rate - obviously the most important thing is for people to work, but failing that, people need to feel compelled to look for work if they aren't currently employed.

Whether people feel compelled to work because of carrots - they are plentiful and/or paying good wages - or sticks - savings or handouts have run out, it doesn't matter. Get out there and get a job.


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