Enjoy... @12:20 into it begins the segment.

Everyone says Merry Christmas and a Happy New Year.

Nice wish, eh?  Some make sure to emphasize the religious aspect of the holiday.  A few acknowledge that early Christians stole the existing festival of the Sun (before we understood celestial mechanics people prayed that the Sun would come back -- they certainly understood that without it they'd die, but not that irrespective of their burnt offering the days would get warmer -- and longer -- anyway!)  And, of course, the mercantile world has turned it onto a debt-fed orgy of buying crap we don't need for people who don't appreciate it.

But let me put the question a different way for the coming year.

What are you willing to put up with?

That's the real question you ought to ask this "holiday season."

For myself, I concluded back in the 2011 timeframe that the people of this country would not force the government to stop allowing the medical system to rob everyone blind, that we would not collectively rise and demand that those who refuse to stop go to prison, and that this meant that either I stop, to the extent possible, my expanding waistline and decreasing physical ability that was coming as I got older or I would have some miserable number of years at a point in the not-so-distant future before I finally met my demise.  This conclusion (and by the way, Congress is perfectly happy to not only screw you but personally profit from it - and you let them do that too) drove me to make a decision.  I decided that I would put up with feeling like I got hit by a bus every day for months and would stop eating a bunch of very pleasurable "foods" that are in fact poisons -- anything laced with sugar, grains, starches and human-generated frankenoils - which are most of them.  I decided to put up with that in order to attempt (with no guarantee of success) turning back that which was inexorably creeping upon me.

The result was that I lost 60lbs and am in better shape now than I've ever been in my life.  But that didn't happen because I "wished" to be able to run a 5k at a sub-7 minute pace.  It happened because I was willing to put up with the demands of getting to the point where I could run said sub-7-minute pace -- and that involved permanent changes in my lifestyle.

There are many who say "well, but there's so much damage I've already taken to my person that it doesn't matter."  Of course it matters; even if your body is severely ****ed as a result of your past abuses a positive change is still positive!  In fact for the person who is seriously compromised today the loss of that 60 or 100lbs is far more important than it was in my case where the really ugly (and permanent) stuff hadn't happened yet because the quality of life improvement is far greater; going from being unable to walk a half-mile to being able to easily do so is a hell of a lot bigger change than going from being unable to run a half-mile to being able to run three.

At the same time I came to grips with the reality that I was (at the time) pushing 50 and if things went sideways I was ok with the outcome.  I've not had a bad run -- and I'm sure as hell not going to ruin anyone else's future gasping for a few more breaths.

I snort in derision at those who say it's "easy" for me to put forward a "cut back to the point of tax neutrality" or "starve the monkeys in DC" perspective, which I have often written about in this column, given that I "made it" in the 1990s.  Why?  Because that didn't just happen on its own and luck had little -- or nothing -- to do with it.

I put up with 15 years of insane demands on my personal time, emotional state, effort and stamina, starting from having one foot in the gutter (literally) and impending personal ruin, moved several hundred miles with no guarantee of anywhere to go or any sort of family support, began working my ass off for a paltry, sub-$20,000 salary that often demanded 80 or even more hours a week from me (no, there was no overtime either), found a (rather crappy) apartment that I could (barely) afford and over time clawed my way up, literally, to where I wound up.  I put up with those hours, the effort, the lack of any sort of "vacation" or time off for more than five years straight, a metric ****-ton of emotional pain, whatever permanent damage all of this might have done to my body (which I'll get to pay for down the road I'm sure) and more.  There was nothing easy about it: MCSNet was not my first effort, it was the third, with the previous two being failures -- at which I put in similar amounts of work and in the end got little or nothing other than managing to pay the rent for a while.  Don't even get me started on the long nights in a basement with a kerosene supplemental heater going so I didn't freeze my ass off while writing code that ultimately went into a couple of businesses -- instead of thousands.  Never mind the jobs in that time where I was working for someone else, often for someone who I believed was completely full of crap.

There are many who say we "can't" fix the serious, even critical issues in this country -- such as the medical monopolies that threaten to destroy the nation fiscally within the next four to five years.  Yes, we can, but no, we won't, because the vast majority of people, probably including you, refuse to put up with the costs of doing so.  I remind you that during the "bailout season" in 2008 I of The Market Ticker along with Steph and Randy of FedUP USA called for two protests -- one in NYC, and one in Washington DC.  I attended the latter.  How many of you showed up at either?  I can count the number of people who were there and have the photographic proof.  If you think I'm going to organize another one of similar sort when nobody will show up you can bite me.   In short, I won't put up with the cost of doing so any more as nobody else is willing to do so.

Everyone wants it easy.  I know people in my circle of associates and family who want it easy.  They "wish" or "pray" for things but they won't put up with the costs.  They won't take the risks, knowing damn well there is no guarantee of success. They are 40, 50, 60 even 100lbs overweight, watching their health go down the toilet yet they stuff their faces with sugared soft drinks and Cheetos despite knowing me, watching me lose 60lbs and go from being someone who couldn't run a half-mile without having to stop to being able to run half-marathons in eight months time.

When an election is lost they want safe spaces and cry zones, complete with puppies to soothe them, for chrissake.

All have excuses but few will take the costs.

Likewise there are many younger people who simply don't want to put forward the risk of jumping out on their own to do whatever it is they want to do.  All choices have costs and when you're young it is the prime time to take those costs -- and risks.  I understand some people don't want the drudgery of the effort and that it's easy to lean on divinity or prayer for a "miracle" but in my opinion there is no such thing as a miracle and the continued prostration before "God" simply serves as a means to avoid the decision to put up with the costs of attempting achievement, no matter what it is -- money, a great body, the freedom to travel or whatever.  You want to talk to me about coming to Church where I will be praying and singing? My riposte is that you are asking me to kneel in a building full of sheep who have sat on their asses for the last 30 years, watching our nation go down the toilet to the point that we now have a large percentage of the nation demanding that you can***** in the women's room if you have a dick. At the same time you've been ignoring your flesh, blood and bank accounts being picked dry by a medical monopolist system that has swallowed the entire damned country -- and that's just one of a dozen similar issues.  When you end your invocation with "God bless America" my riposte is "If this is the outcome that defines blessed perhaps we should try damned for a while thank you very little."

Cut the crap folks.

There is nothing that focuses the mind more than hopping out on the beam and realizing that there's no net!

If you never commit you greatly diminish the odds of success, no matter the endeavor.

If you refuse to put up with the costs of whatever you desire up front then you are unlikely to get whatever it is you desire because the only way to achieve said goal without paying those costs is to force someone else to pay them for you.

Fact: The universe owes you nothing because it is incapable of providing anything.  It is a fact that the universe tends toward disorder and you can see it all around you -- a piece of wood left out rots, a nail (or your car for that matter) rusts, everything, without continual effort put in to stop it, ultimately reverts to dust.

So this holiday season spend less time fawning over someone's birthday (which, incidentally, almost-certainly didn't really occur in December, but rather in the spring) and instead decide what you will put up with -- and, at least as importantly, what you won't put up with in this upcoming year.

Make that what you focus on when the calendar clicks over.

Facts:

The S&P 500, and most of the DOW, garner a lot of their revenue (and earnings) overseas.

The Dollar has been on a tear for the last several months (since August, roughly) and is now trading at levels it has not since 2002 (!)

Said currency translation means that those foreign earnings are depreciated since foreign currency buys fewer dollars.

The S&P 500 is trading at historic highs on a cyclically-adjusted P/E basis, and well into "overvalued" territory even on simple trailing earnings. In fact on a CAPE basis the S&P is trading at a higher multiple than either 2000 or 2007!

In other words the entire market is priced for perfection -- higher earnings in the future, a softer currency and no increase in operating -- that means borrowing, given the last few years of history -- costs.

None of those things are likely to be true.

It is an effective impossibility that all of them will be true.

How overvalued is the market?  That depends on where you look in the market but 25% overvalued is in fact quite conservative.

This, of course, assumes no shocks.  No problems with debt load.  No runaway inflation, or worse, a runaway budget deficit (caused by tax cuts and Trump's refusal to address medical monopolies, which I remind you, he has struck from his transition web site and made not one mention of since the election.)  It is thus extremely likely, in fact bordering on certainty that runaway medical costs in the federal government will destroy the federal funding model within the next four to five years.

It assumes no serious terrorist incidents that disrupt transportation occur; for example, a "rogue" MANPAD attack on a cargo airliner (or worse, a passenger jet!)

It assumes the dust-up in Turkey doesn't spread (which could lead to a global conflagration.)  I remind you that Europe, including Germany, has invited millions of jihadi-sympathizing "refugees" into their nations over the last few years.

It assumes that the inexorable home price destruction that comes from higher interest rates (which is a simple mathematical formula) doesn't result in either a collapse in home sales or possibly worse, a re-emergence of zero-down liar-loan style "financing" that (again) blows up in everyone's face, threatening the destruction of the financial system -- when neither The Fed or the Government has the ability to once again double federal debt to bail them out.

The TNX (10 year Treasury) has already broken the declining trendline from 2009.  But far more-importantly it has also decidedly broken, on a monthly closing basis (and will almost-certainly do so on a yearly closing basis) the bond bull-market trendline dating to 1983.

Almost exactly none of the so-called "market mavens" that are out there today have any memory of market conditions prior to that bond bull market as none of them were in the market 30+ years ago.  Many younger professionals weren't even alive back then.  Nobody under the age of 50 was an adult when that last secular change took place and almost nobody under the age of 60 has any sort of experience managing wealth in such an environment because few people under the age of 30 have any wealth to manage.

In other words everything you, your broker, the media and everyone else thinks they know about markets is wrong because the predicate on which all of it has been founded for the last 30 years has, in the last two months, been ripped out from under you -- and them.

In 1999 despite it being obvious that the tech wreck was going to occur the market continued upward and in fact the Nasdaq doubled during that year before it all blew up and crashed -- entirely on "animal spirits", or more-accurately the greater fool was out in force.

Said fool then lost nearly all of his money.

Cramer's Winners of the New World portfolio lost very close to all of its value -- something that even today he refuses to talk about.

But this time there is no place to go for a "reflation" of those assets.  The government cannot "print debt" into a rising rate environment as doing so causes instant insolvency through unpayable interest expense as the current debt load makes materially adding to said federal debt, certainly in the amounts required to stop such a collapse, impossible.

In short the game of "turning the leverage crank" to bail people out and continue the rise in asset prices has ended.  I have been warning for the last several years that this was inevitable but the question is always a matter of timing.  It went further than I thought it would (by quite a bit) but that's not unusual at all, since the break-point is almost always a matter of psychology rather than hitting a hard limit somewhere.

We now have the timing, however, with a solid and violent monthly break of the 30+ year bond trendline and a nearly-certain annual (and equally-violent) break of that same trend.  It's over, and this means that whatever you think you know about the investing world that has been predicated on ever-cheaper credit is wrong and in fact exactly backward.  It is now merely a function of when psychology catches up with reality -- and it will, because on the math it inevitably must.

Time's up.

Unfortunately, not as the Demoncrats had hoped for.

Yes, there were faithless electors.  One was ruled out of order and changed his vote.  A second was replaced.  Six more did in fact vote for other than the majority winner in their states.

Only two of them, however, voted for someone other than Donald Trump -- both in Texas.  The rest -- six others -- voted for someone other than Hillary Clinton.

That's right, a few heard -- and heeded -- the call to be "faithless."

But most of those who did decided that their statement of political protest was not to be lodged against Donald Trump and his victory but rather against Hillary Clinton and the Democrat party who attempted to subvert and in fact overturn said legitimate political victory.

The Democrats, and especially the whining millennials that I'm sure have now been once again triggered and are crying in the streets and on our college campuses, will almost-certainly again issue recriminations not against their party nor will they apologize for their actions.

No, they'll blame the Russians, the Chinese, or..... maybe it'll be Martians this time.

You can bet there will not be one scintilla of honest reflection from this event, just as there was not from the election itself.  There was no reflection on the fact that Hillary lost three states that Democrats were not only expected to win but had won handily -- all organized labor and minority strongholds -- in recent contests.

Nor was there any reflection on the fact that Hillary appeared to put forward the view that she deserved the Presidency; that it was hers by nobility, rather than by hard work.  There was no reflection of the rank and outrageous corruption she had displayed in her time as Secretary of State and beyond, nor the hubris of her senior staff.  There was not one whit of concern over the millions of jobs that policies her husband put into place had cost the nation -- polices she herself supported as well.

Three states flipped over this set of issues and yet Hillary could afford to lose none of them.

Worse, when the screaming started on "recounts" and "fraud" Wisconsin completed their count and it resulted in a tiny, statistically-insignificant change -- for Trump.  Pennsylvania never got anywhere but in Michigan, which had their recount halted by a judge the only irregularities found were in heavily Democrat precincts in central parts of the city of Detroit where more ballots were cast than persons signed the books for.  In other words there was a small amount of fraud uncovered all right -- but the fraud wasn't in favor of Trump, it was for Hillary!

The Democrat party has two choices here.  It can either accept this outcome as a spanking delivered by an electorate that wasn't swayed by Russian hackers, but rather by the displayed public corruption of a party that not only didn't give a damn about party member votes (in that they rigged their own primary) but also didn't give a good damn about their party member's economic prospects and believed they were entitled to those votes anyway and choose to reform itself.  It can eject those party hacks who led it into and through this disaster, including people like Pelosi, the Clinton family, John Podesta and the dozens of so-called "tech mavens" and "socialites", including anything connected to George Soros.  Should it do so the party may in fact find a means to reconnect with the people in the coming years and rebuild itself.

Or it can continue on the path it has been on thus far and double down once again on the claim that "Russians" were responsible, that Trump is a racist, that I'm both deplorable and irredeemable (along with millions of others) and more.  It can refuse to accept that kowtowing to multinational companies that move jobs overseas, draining both intellectual and physical capital is a losing strategy long-term when it comes to votes and that places like WalMart may provide short-term lower prices in exchange but in the end when you lose your job you have nothing to buy with anyway beyond food stamps and disability checks, and that's a crappy way to live.

If the party takes the latter direction, and it appears so far that's exactly their intention, then it will fade from prominence and leave open in the political landscape a replacement slot, just as happened with the Whigs -- and much for the same reason.  I have no idea who will step in to fill that vacuum, since there is no political party in the wings that fits the model; certainly neither the Greens or Libertarians have put forward the sort of organizational prowess or serious candidates over the last two decades necessary to do so.

But that the vacuum will be filled, probably by a nascent political party we have not yet seen organized, is a given.

Collections of political power are always at risk of excessive hubris.  Sometimes, as occurred with the Republicans, the body recognizes, however begrudgingly, that the shift of sentiment away from them is occurring and lets it happen.  His name in this case was Donald Trump.

In the Democrat case they refused to recognize that same problem within the ranks of their elite.  The challenger's name in their case, by the way, was Bernie Sanders and instead of coming to terms with the repudiation of Democrat voters who had enough of the Clinton corruption and entitled attitude they doubled down, called names and then rigged their primary to disenfranchise their own voters -- and got caught doing it. In response a sufficient number of those voters either stayed him or voted for a Republican to hand the party a loss in three critical states.

Finally, in an act of puerile rage, they tried to tamper with the Electoral College -- and got slapped down again, in that the net defections they managed to score were against them, not Trump.

This is what peaceful political revolution looks like folks.  It may not be perfect, and I have no belief whatsoever at this point that Donald J Trump will address the issue he must, within the first year of his Presidency, if we are to avoid fiscal disaster -- but it sure beats the shooting-style alternative.

It appears a special-forces Turkish cop assassinated the Russian Ambassador while yelling "you kill us in Aleppo, we kill you here."

As a reminder, Turkey is a NATO member (well, in name anyway.)

Russia is unlikely to let this go unanswered.

This is not a good situation folks.

Not at all.