Can you imagine how well this economy would be doing if Washington weren't the enemy of capitalism? Can you imagine how high the stock market would be if President Obama cared about it? Can you imagine how robust retail sales would be if the Congress could find a way to agree with Obama?
I can't believe what a travesty government is when it comes to putting people to work and encouraging capital formation. The Republicans seem to focus on social issues first, more than anything, even as they now say they are bearing down on government spending. The president seems to focus only on making the rich pay more.
No one, it seems, is focused on putting more people to work except for Ben Bernanke. I guess someone has to do it. You would think it would be the Executive or Congressional branches. Nah. I don't know if you could do less to help the working people than they are doing. I don't know if you could hurt business formation more even as we are just now beginning to come out of a recession. Even the sequester seems uniquely designed to throw as many civilian workers out of jobs and onto unemployment roles as possible.
And yet the economy keeps on ticking. This morning I spoke to Michael Jackson, the pioneer behind AutoNation (AN), a fabulous company and a terrific investment and he's looking for auto sales to be more than 15 million in this country, another great year. But perhaps more importantly, he sees the used car market coming back, a secondary market that can be every bit as big as the new car market, but has been stalled by a lack of product.
The point he made sticks with me. Jackson said we are coming out of not a recession, but an actual depression in auto sales, and that's such a strong pull that it looks, to me, like the government, try as it may, can't stop it.
Same with retail sales in general. Take Target (TGT). Last week it definitely disappointed, no doubt about it, but today it roared from the get-go, hitting a 52-week high, of all things. We've got wealthy people spending, as we know, from the luxury purveyors. We have poorer people spending, as we know from the Dollar Tree's (DLTR) numbers and we have home builders and do-it-yourself people spending, as we know from Home Depot's (HD) terrific report.
These are all happening, I believe, because of the wealth effect. A combination of higher home values, again, because of a depression in housing that is now over, and higher stock portfolios are ineluctable forces, forces that can't be stopped either by the Republicans or Democrats. Yep, a housing depression, that's the only real way to describe a market where we built only a quarter of the homes we were putting up just a few years before.
Finally, no matter what Washington does, and they are doing plenty bad, it looks like they can't stop our energy development. We are drilling oil and gas wells, building railroad lines and making our continent energy independent with the hindrance of Washington the whole way.
I marvel at what kind of growth we could have if Washington helped. But I am realistic. It is not going to happen under this presidency and this Congress. They are roadblocks to progress. They are roadblocks to the higher tax revenues that American economic success would breed. They don't care. So the private sector will just have to weather the storm of DC and keep on keeping on all by itself.