Thoughts from the Frontline

This week’s letter is the first part of my 2021 forecast. There is simply too much to cover in one letter, and today we’ll start with the most important factor, a known unknown, that I think will be the driver for 2021.

"History repeats itself, that's one of the things that's wrong with history.” —Clarence Darrow (1857-1938), American lawyer

The essential point to grasp is that in dealing with capitalism we are dealing with an evolutionary process… At the heart of capitalism is creative destruction.

Growing income and wealth inequality were on my (and probably your) radar screen long before COVID-19 came along. The pandemic has made them both more obvious and more urgent. The actions by the Federal Reserve have widened the gap. We are now in a situation where society’s upper echelon can easily stay safe and prosperous while the lower segments live precariously and dangerously.

A Happy Thanksgiving weekend to all my US friends. This year was different for many of us—sometimes by choice, sometimes not. But there’s one bit of good news I think we can all share: The holiday season means 2020 is almost over. Soon, we’ll be able to turn the page.

In baseball, there is a situation where a base runner is sprinting to home plate and can’t see what is happening behind him. Totally focused on scoring, he doesn’t know if the outfielder is throwing a ball that will reach home plate first. That’s where we get the phrase “out of left field.” (If the ball were coming from right field, the runner could actually see it.)

Last week I talked about the polls misleading us. I, for one, didn’t see a high probability of a Biden presidency combined with a Republican Senate. But, pending recounts, legal actions, and some run-off elections, that’s probably what will happen. We will muddle through.

Here in Puerto Rico we are now an hour ahead of Eastern Time, as we don’t do daylight savings time. I stayed up much later than normal on election night to watch the returns. I knew fairly early, when Florida and North Carolina looked so close, we weren’t going to see a “blue wave.” But beyond that, it was clear the presidency would not be settled that night.

“If I have seen further it is by standing on the shoulders of Giants.” —Sir Isaac Newton, 1675

Those who lived through the last financial crisis might may recall the Green Shoots episode. It drew laughs on March 15, 2009, shortly after the Federal Reserve fired its heaviest artillery and, we now know, launched the longest bull market in history.

We're caught in a trap I can't walk out Because I love you too much baby

Like everyone else, I am weary of this pandemic mess. I want to travel freely, enjoy dinner with friends, hug, and shake hands.