Issues, News & 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.


2018/01/10 - Happy New Year. As is our wont, we herewith provide our semi-annual update on the economy and markets. For years now we have been correct, and we again predict that our predictions will come about as predicted.

Let's begin by talking about the black swan risk factors, and topping the list is Korea. We continue to believe that a Korean war, while not probable, is far more likely than commentators and pundits predict. We do not believe the probability is as high as one in two (50%), but no less than one in five (20%) and possibly as high as one in four (25%) or even one in three (33%).

It is hard to game out what would happen in a Korean conflict. For example, in a best-case scenario, a successful decapitation strike combined with a pre-emptive nuclear-threat elimination strike could cause a collapse and surrender by the NK's, ending the war almost before it starts. Such an immediate, desirable and definitive outcome would prompt a short term euphoria initiating another leg up for optimism, sentiment, markets and the economy.

But that's not going to happen. More likely a conflict will include several weeks of very ugly ground war with many casualties in the South, and this will hit markets hard. Stay hedged in case there's a war, stay fully invested in case there isn't.

And the world will be on edge as it watches and waits to see what, if anything, China can or will do. Ultimately we believe China can do nothing. The North is the worst regime on the planet. China is hardly better, a wolf in sheep's clothing for whom Kim a useful pawn, but this is not the time or place for China to undress and expose their geopolitical ambitions of regional domination.

Aside from Korea there are the usual concerns, including massive global debt, especially among governments. The US government has a spending problem (not a revenue problem). At some point our $20+ Trillion debt will catch up with us, but that day is not today. Soon, perhaps, but not now. The party is not over quite yet.

United States equity markets continue in a "buy-the-dip" environment which serves to prevent small dips from becoming huge crashes. Which keeps buyers poised at the edge, ready to jump. If there is a major correction it would come from a geopolitical shock like Korea, or a change in economic outlook like a bad read on inflation, but not an "air pocket", not some kind of random imbalance of supply and demand contained wholly within capital markets.

We continue to hold a constructive view of the United States economy with a number of factors contributing to the favorable environment. However, we do see risks of a downturn developing. We are not saying that a recession is inevitable or even likely any time soon; but there exists a significant possibility that recession pressures may develop as the year unfolds.

The first and most important factor presently in play, as always, is the cost of energy. And yes you can thank fracking for these favorable energy supply fundamentals. The price of oil and especially natural gas remain at levels conducive to economic growth. That being said, the price of oil continues to climb. Heretofore we had expected oil prices would hit a ceiling before approaching their current levels, but that doesn't seem to happening quite yet, which is a concern.

Theoretically a domestic price of $60 should be triggering a response of increased production that should keep near-term prices in check. In addition, these prices should serve to stimulate investment in exploration, development and related technologies that should keep the longer term price trajectory at sustainable levels as well. But no one seems to be opening the spigots.

The second most important factor in our positive economic view is the continuing roll back of regulation by Republican administrations at both the federal and state levels. This is the big mystery that economists, journalists and bureaucrats never seem to understand. Unless you are a business owner you will never grasp how oppressive a regulation can be, and how suppressive it is to economic activity.

Economists don't know how to quantify regulation and therefore do not model it. Thus there is no index, no data release, no time series, no news for journalists to report on. And in quite retrograde fashion, legislators and burrocrats (yes, they are asses) point to the growing number of laws they have passed, and regulations they have implemented, as metrics of their success, while in fact they suffocate the economy.

The deregulation wave sweeping across America will continue to fuel economic growth, growth unexpected and unpredicted by the Media-Academia-Government Complex. And of course President Trump will get no credit for the growth and opportunity he is spurring in America. Deregulation is low-hanging fruit. It is free money. It is like how good you feel when you stop banging your head against the wall.

The third reason for continued US economic growth is the new tax cut. The cut in business taxes will switch the US from being one of the most punitive tax nations to one of the most accommodative tax nations. Not only does this serve our economic interests directly, it also forces other jurisdictions to respond, fostering organic economic growth in their countries, causing them to buy more US goods and services. It's very good.

There will also be an impact by foreign companies. For an example, consider BMW, which builds its entire global production of SUVs in upstate South Carolina. Energy is cheaper, land is cheaper, and regulation less frustrating, than any other potential alternative on the face of the planet that BMW originally considered.

Now you can add lower taxes to that list. Not only will the US maintain its hold on BMW production and not need to worry about seeing it clawed away by Mexico or China, BMW might decide to allocate an even higher proprotion of their global vehicle production to the US.

But every firm around the globe with international operations faces the same considerations - some of whom will maintain production here, production that might otherwise have been vulnerable to relocation; or other businesses who might now decide to expand operations here; or still other companies who will be attracted to America who might otherwise have proceeded with other alternatives.

A fourth reason for continued US economic growth is global economic growth. For some years the US economy has been hampered by sluggish growth elsewhere, but now global economies are showing signs of growth. There had been worries about China but those seem to have dissipated (for the time being). Brazil had seven months of positive employment growth (before dropping back a tick in November). Eurozone factories are registering production levels that are at all-time highs.

A fifth reason for economic optimism is the current low levels of interest rates. Yes, rates are rising, but at a very slow pace, and from historically low levels. Rates are still very low, but the expectation of rising rates should entice businesses and households to invest now and lock in low financing costs while they still can. You can expect homebuilders in particular to do well in this environment.

With these factors in play we see continued favorable economic prospects. Whether or not growth will continue its string of >3% growth quarter after quarter remains to be seen, but it is not unrealistic. It stands to reason that the stock market should continue moving northward as corporate revenues increase, margins expand and profits proliferate.

But synchronized global growth is a two-edged sword. Too many economies doing too well all at the same time creates demand pressures and price bubbles. Bubbles take many forms - an oil bubble, a housing bubble, a dot-com bubble, a tulip bubble, a bitcoin bubble, a copper bubble, or perhaps this time it will be an Amazon bubble.

Consider China, to the extent you can. China is opaque, and everyone knows it has its issues. Just because China fakes its numbers doesn't mean things are going badly. The China-bears have been wrong for a long, long time. But even a broken clock is right twice a day.

One good China indicator is the price of copper. Copper supply is relatively stable, and copper demand is mostly a China story. If the price of copper goes down, that would indicate trouble in China. Copper has been on a roll since the summer, currently sitting at 4-year highs. This indicates strong copper demand from China, which in turn is indicative of robust global economic activity.

However, we may already be in a copper bubble. Copper rose above $3/pound in August and now sits around $3.25-$3.30. Since hitting $3.15 in September, it has twice dropped to about $2.90 but the second dip was of shorter duration. Fluctuations are normal, but it should keep hitting higher highs and higher lows.

But, excessive demand combined with a supply shock could be problematic for the global economy. Freeport-McMoRan, the world's largest corporate copper miner, has been in sometimes acrimonious negotiations with the government of Indonesia about its mining activities there, and there is always the possibility that it could end badly with a strike, lock-out or some other production disruption.

A significant contraction of copper supply could cause an economic face plant in China. Not enough raw material available, and too high a price for what is available, could drastically slow their economy, in turn triggering a melt-down in their debt-laden real estate market. Eerily similar to our economic meltdown in 2008 triggered by the oil bubble.

And then there is oil. Our economic optimism over the past few years has been founded partly on low oil prices, but $60 oil is not stimulative. It is a good price, a fair price, but hardly the windfall that consumers both businesses and individuals have enjoyed the past few years. We may see an oil price bubble develop if US production does not soon increase beyond levels that are currently approaching all-time highs set in the early 1970's.

We will not avert a spike in oil prices if US producers get greedy and do not ramp up production soon. Just like the copper scenario we outlined, inadequate petroleum production combined with a supply shock Iran looks at-risk at the moment could cause a face plant in the global economy.

There is also a question of how much slack there is in the US labor market. The how-and-why of the low US labor participation rate is a very relevant question but well beyond the scope of this article, nonetheless, the economy - employers - may soon run out of workers even while many prospective workers choose instead to sit around smoking pot and collecting government hand-outs. (Hey Washington, now would be a great time for welfare reform).

Just like the oil and copper markets, we may soon see a price spike in wages, perhaps a drastic one. As companies have to pay incrementally more for each marginal worker they add, they become somewhat obligated to pay all their workers on the same scale, thus rapidly increasing their payrolls and creating consumer price pressures.

Price pressures on inputs such as labor and commodities tend to find their way into consumer prices, which means inflation. And if the Fed sees inflationary pressures developing, then interest rate hikes will surely follow larger rate hikes at a faster pace than the stock market has priced in. Right now most pundits are expecting two to three hikes this year, but more than that could cause markets to tumble. And that wakeup call would cause consumers to pull back their spending.

Many left wings pundits are arguing that now is not the right time for the recently enacted tax cuts and they are right, at least in economic terms. They may very well contribute to a recession in the short term. But they will also contribute to a robust recovery and are vital in the long term. And now is the only time it could happen politically, thanks to those very same liberals. The time for the tax cuts was eight years ago. Better late than never.

The bottom line is that recessions are caused by insufficient supply of production inputs - if a business can't get their hands on sufficient raw materials, they have no choice but to curtail production, and at the same time, increase prices charged to customers to maximize the revenue on what they are able to produce. Higher prices cause consumers to scale back consumption, while simultaneously, central banks see rising prices and raise interest rates - when the economy is already slowing down. And as this reverberates throughout the business sector, prices continue go up while employment continues to decline, and the economy falls into recession.

Again, we are not saying that a recession is imminent, or even likely. What we are saying is that the pieces are starting to come together, and that is not something we have said over the past few years. We see storm clouds on the horizon, but that does not mean it's going to rain. We are still positive on the economy. For now. Check back in July.


January 31, 2018 - President Trump totally owned the Democrats last night in the State of the Union Address.

The President's speech was uplifting, reaffirming the qualities and character that makes America and Americans great. And the Democrats looked like they hated it.

President Trump exhorted Congress to work together for the good of the country. And the Democrats scowled.

The President implored Congress to rebuild our infrastructure. And what the voters-to-be saw as the camera panned the audience was clapping cheering Republicans and sneering motionless Democrats. (BTW, who would you vote for?)

Trump pointed out the need for job training programs to ensure we have a 21st Century workforce. And the Democrats frowned.

And he even offered a path to citizenship for 1.8 million illegal immigrants. Yet Democrats seemed to hate that the most!

Hold it - infrastructure, immigration, worker-training? Aren't these traditional Democrat values and policies? Or not anymore?

So what does the Democrat Party even stand for nowadays? Nothing, it seems. Just nastiness, and it was there for all 2018 voters to take note.

Democrats looked ugly last night. Last night they lost the 2018 elections.

January 30, 2018 - Tonight is the first State of the Union address from President Trump. Here are a couple of items that Chalprem would like to see the President include:


Reaffirm the commitment to abundant, low-cost, all-of-the-above, supply-side, no subsidy / no penalty, market-based solutions to affordable energy.

In exchange for keeping the base price of gasoline low, substantially raise the road usage fee (frequently falsely referred to as the "gas tax").


Use the increased road usage fee revenue to rebuild and expand our roads, bridges and tunnels.

Promise NOT to use tolls or general tax revenues to fund highway infrastructure. Road usage fees cost about 1% to administer versus 30% for tolls. Seriously, we love the "gas tax" - and you should too!


Reaffirm that it is odious, nauseous to ignore our own laws and grant legal status to law breakers. Such actions are corrupt, they violate our founding principles. We got rid of King George III due to his arbitrary governance. We are a nation of laws.

Nonetheless offer some kind of legal status pathway in exchange for serious border security enhancements.

Drive a wedge among Democrats - offer Dreamers the deal of a lifetime, in exchange for border security that Democrat operatives cannot accept. Position the Dems against the Dreamers.

As principled people we conservatives hate violating our long-term sense of right and wrong, but it always makes sense to grant a transitory concession in exchange for a permanent resolution, as long as it really is a permanent resolution.

DACA - let's hold our noses and pay the price for border security. And excoriate Democrats for opposing border security, for actually extracting a cost for it.

Energy, infrastructure and border security. That's what we want to see in the State of the Union.

January 20, 2018 - Welcome to the Schumer Schutdown. The brilliant Senate Majority Leader Chuck Schumer has decided to shut down the government to advance his corrupt DACA agenda.

America is founded on norms, we are a country of laws, the direct antithesis of the arbitrary rule of King George III. That's what the Declaration of Independence is about.

Our adherence to norms and laws is part of the foundation of what has made America the greatest nation in history. We have a clear set of rules and everyone is expected to play by them.

When a nation's rulers grant targeted benefits to certain favored individuals in violation of the country's laws and norms, when laws are applied preferentially to certain constituencies, the word for that is "corruption".

Public corruption destroys nations. It is a cancer, it causes decay and rot.

The position taken by Charles Schumer and his fellow Democrats with respect to DACA is public corruption. Corruption causes the law to lose its meaning, and heralds a return to the arbitrary governance of George III.

Thomas Jefferson is turning in his grave.

January 15, 2018 - Today is Martin Luther King Day. We all know about his "I have a dream" speech. We're probably all familiar with some of the snippets, so how about this one:

I have a dream that my four little children will one day live in a nation where they will not be judged by the color of their skin but by the content of their character.

Note that Dr. King did not oppose being judged; rather, that skin color was a terrible yardstick upon which to pass judgement.

Dr. King challenges us all to live up to our responsibilities, and he challenges us to accept judgement of our character.

Do not judge us by our skin color, not by our place of birth, not by the car we drive or the clothes we wear. But do judge us by the content of our character.

Dr. King understood and taught that with rights come responsibilities. That freedom isn't free.

Am I willing to accept Dr. King's challenge? Are you? How would I do? How would you do?

Happy MLK Day.

January 11, 2018 - The Washington Post is citing unnamed sources that allege that President Trump used a derogatory term, words that we will not repeat here, to describe certain low-GDP countries generally and Haiti in particular.

The GAME (government-academia-media-entertainment) complex will be all over Trump for this for all the wrong reasons. Let's be honest, there are some really nasty places on earth that none of us would care to ever go to. There are places that truly are hell on earth. Who's kidding who?

Consider Venezuela - once a beautiful prosperous country, then a left wing dictator got hold. Fifteen years later the government has now outlawed coroners from using the word "starvation" as a cause of death. And the capital city Caracas has the world's highest murder rate. Hell on earth.

So to those elites who will criticize Trump we ask a few questions:

Have you ever taken your family on a vacation to those disaster countries that you are suddenly defending as model nations? No? Why? Maybe because deep down you know that they truly are the disasters as described by the President?

Have you ever used derogatory terms - genuine heartfelt scorn, condescension, derision - to describe middle America, places like Kansas or Alabama? Or even New Jersey? Many a pompous New Yorker has said worse things about New Jersey than the President said about Haiti.

The left just doesn't seem to understand how hypocritical they are in alleging discrimination in others, while not acknowledging it in themselves.

Is Trump crazy like a fox: you can bet that this deep-sixes Michael Wolf's book from the headlines. The fake news cycle has moved on.

By the way, if you want to know what that unpresidential term is that the President used to describe Haiti et. al., check out CNN - they seem blind to the lack of professionalism and outright hypocrisy of incessantly repeating that term on air, all the while assailing the President for allegedly speaking those words off the record.


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