Just when you thought US politics couldn’t get any darker – what with the president openly musing about firing the attorney general who is investigating the president’s campaign – in comes new communications director Anthony Scaramucci, with a, ahem, unique critique of his new coworkers:
Scaramucci, the newly minted White House communications director, set off a firestorm with a rambling rant loaded with expletives and threats that The New Yorker published. The coarse language directed at Priebus and White House Chief Strategist Steve Bannon, as well as blanket threats to fire people, left some inside the White House shaken.
“This is getting out of hand,” a White House staffer told Fox News. “I am honestly concerned for my safety in the office tomorrow. This type of behavior is unbelievable. Working in the White House, and something like that is said … it’s a disgrace.”
Former Republican National Committee boss Priebus was left seemingly even more isolated in the aftermath. Scaramucci all but accused Priebus of media leaks, a recurring problem that has vexed the Trump administration. Other RNC colleagues brought into the administration have been nudged out of the West Wing, and Scaramucci’s hiring came with the rider that he reports directly to Trump – not Priebus.
Priebus has not reacted publicly to the broadside from his West Wing adversary, but it is hard to imagine the two co-existing in the administration after the public eruption of animosity. Scaramucci said after his tirade but before it was made public that any chance their relationship could be repaired was in the hands of the president.
“Reince is a (expletive) paranoid schizophrenic, a paranoiac,” he told the New Yorker about the White House chief of staff.
Scaramucci also took a shot at Bannon.
“I’m not Steve Bannon, I’m not trying to suck my own (expletive),” Scaramucci said. “I’m not trying to build my own brand off the (expletive) strength of the president. I’m here to serve the country.”
At some point, these guys will find themselves sitting around the same conference table. If video of that meeting ever leaks it will break the Internet.
But why bother with tawdry political theater on a finance blog? Because you’d think the markets would be petrified by the prospect of a government paralyzed by this kind of infighting. Instead, stocks are at record levels and bonds are holding up nicely. What gives?
The Fed, that’s what. Under today’s New Age monetary regime, bad news anywhere is good news for financial asset prices because the world’s central banks, led by the Fed but abetted by the European Central Bank and Bank of Japan, stand ready to throw trillions of new dollars, euros and yen at whatever threatens to go wrong out there. And they’ll do it sooner rather than later. As ECB chair Mario Draghi put it recently they’re in “reactive” mode and won’t hesitate to hit “send” with cash infusions whenever the markets event hint at a downturn.
So buy the dip and relax.
This is of course a recipe for disaster. But if you’re managing money and are being judged by quarterly results you don’t have the luxury of thinking long-term. The rest of us, though, should definitely be planning for the day the music ends and the big banks, index funds and hedgies try to leave the dance floor en masse.