I love the smell of denial in the morning.

Over the weekend, presidential hopeful Donald Trump laid out his concerns about a massive recession coming, but almost as quickly as the words were out of his mouth, the media started hammering that Trump was off-the-mark.

For example, take a look at this CNBC piece:  “Trump predicts massive recession but economists say he’s wrong…”

Having a pretty good track record around here, of calling the market, I’d be more inclined to put my money on Trumps outlook than the me-too “economists” who are standing up to proclaim Trump is wrong.

There are three really important reasons why Trump might actually be right.

1.  The democrats have pulled out all the stops (along with the Obama wing of the GOP led by house speaker Paul Ryan) pretending that the current, and very real, problems of the economy are over-stated.

As I see it, they are not.

For one, the GOP did a complete lay-down on the just passed federal budget.  There was not so much as a whimper.  There was no mandate to the Border Patrol to stop playing the “catch and release” game.  There was no hardcore spending cuts on inefficient programs.

But the real fix was in pushing what WOULD have been embarrassing increasing in Obamacare back to 2017.

Reason?  So the crooked politicians who are looking to feather their nests – on both sides of the aisle – will be able to retain their easy-chair lives and roll-up more congressional pension bennies that come with additional terms.

2.  Long wave economic theory – which recognizes that recessions and Depressions are cyclical in nature, show a distinctive parallel to the run-up from 1921 to 1929’s blow-off peak.

As I told Peoplenomics.com subscribers recently, the only thing missing is a gallon of gasoline to be thrown on the fire.  Something to drive a Super Bubble.

I also urged subscribers to read the Salon article “Donald Trump’s Social Security heresy: Taking on Paul Ryan and the privatization push.”

That’s because in most of the privatization schemes for both pensions and Social Security, there would be huge inflows into the stock market.  And that causes – naturally – a massive stock bubble.

Trump is a businessman extraordinaire.  Like him, or not, he knows what follows a bubble.

A Crash.

Which we’ve been patiently explaining should follow our fifth and final surge up in the markets between now and election time.  This is something I’ve been predicting since January, including calling the market turn up in February, when the internet charlatans were predicting the End of the Financial World.

Didn’t happen.

3.  One of the surest way to think about economics is to learn to deal with your timeframes correctly.

I’ll show you what I mean:

Suppose you are a working man, or woman (or here lately, some mix) and you are looking after your own investments.

If you are worried about having enough money to make rent come the end of the month, you likely have a net worth of somewhere from an ugly negative number to perhaps $25,000.

On the other hand, if you have a positive net worth in the $25,000 to, oh, $100,000, you are statistically more likely to worry about successfully saving for some big project that you have in mind.  Remodeling a kitchen, going on a serious vacation.  But you KNOW you have the rent or house/condo payment covered.  Financial thinking timeline extends a ways.

Now, what happens when your net worth goes up even more?  When your net worth is $100,000 and up, you begin to think about how to most effectively put your money to work.  You buy INVESTMENTS and manage them well.  Rental home, an assortment of stocks or bonds, precious metals, collectibles like guns, antiques, art, and so on.

When you get to the $1,000,000 net worth mark, you are usually figuring out how to become your own business owner.  Grow your own company.  Get on the map in a big way. When this happens, things begin to look really solid for you.  Time horizons extend even further.

Now, you see what has happened here?

If you are poor, your time scale is very short.  Payday.

As your wealth goes up, your time scale lengthens.

And when you get into the billionaire class like Trump has done in real estate, your investment horizon is on the order of 5-10 YEARS.

That is because when a fellow like Trump, who has forgotten more about real estate deal-making than your or I are likely ever to learn, makes a decision, his time scale in minimally 5 years.

Here’s why:  The first year of a project (like in rental mega complexes (if you read Art of the Deal) is eaten up by rounding up the money, the additional investors, finding the ground, acquiring the dirt, doing the impact statements, and so on.

Somewhere at 12-18 months the project is green-lighted and building gets underway.  It may take six months – and if issues arise, it could be longer.  This is not 90-day spec home country.  This is large scale commercial.

And then, 24-30 months out, the building is done and now you have to fill it up with long-term tenants.

And then you operate for a year or two so you can work out whatever depreciation and tax angles.

THEN the property goes on the market.  Let’s say at the 36-month level.

The resulting sale might happen anywhere from 36-months to 60-months – and if the economy is very bad, it might take years to offload a piece of property.

You can see very clearly why Trump (and his ilk) tend to live 5-10 years in the future.

So when someone like Trump (who effectively lives out 5 years ahead of the rest of us) makes a prediction I would play really close attention.

The most common real estate cycle is 11 years.  Here lately, there are some analysts who are promoting the ideal of the “18-year real estate cycle.”  In that one, as you will see over on this site, that would make the next mega crash somewhere out in the 2024 area.

What Trump, though, has more likely worked through is that the 11-year cycle may be in play.  And if that’s the case, we would see the collapse begin in 2019, or even earlier if we get an accelerated blow-off top.

Now this is NOT  the kind of stuff that comes through in the hyena media.  This is what comes from not only listening to someone with deep knowledge in an area (long term investing) but also extracting the meaty heart of things.

Ure’s applicable axiom is #6:

Poor people plan a few minutes, or at most a couple of weeks ahead.

Rich people plan YEARS ahead.

So, when the media bash Trump on sharing his concerns, remember that the real top in the real estate market occurred in 2006-2007 and that means the real top in prices could easily come along in 2017-2018.  And the National Ugly Depression we’ve been talking about could follow shortly thereafter.

I’m immensely heartened by Trump’s outlook.

What’s disheartening is how few people understand the economic context of it.

But then poor media types can’t be expected to have a prosperous investors time scale.  Otherwise, I’d be out of the axiom business.

Note to Idiots in the Press:  The obvious follow-on was missed!  It should have been “What is it you see?  Implosion from a bubble in an asset class, or the cumulative impact of compound rates of growth simply becoming unsustainable.  Or Both?  Cut us working people some slack and do tell more!

The dull witted press blew this big-time.

Note to self:  When billionaires talk, ask them to elucidate more.  Not go “O’Reilly” on them!

Sideways or Down?

In the meantime, we have this week’s passing headlines to consider.  Some are more revealing than others.

If you were a subscriber, I would be pointing you to the glacial-speed stories that really matter.  Like how Janet Napolitano “University of California president proposes privatization of pension fund.”

You remember Janet, right?  Former Arizona Governor and ex head of Homeland Security?

If you were a subscriber, I would suggest Janet as an example of how bright people tend to move way, way in advance of secular events.  What does she know, what does she see?  It’s lost on the Neanderpress.

So instead, let’s look at short-term,. shall we?

Stock futures are up 11-points going into the open.

The Baltic Dry shipping index has moved up to the 450 level from its previous high 300’s so the trade world thinks things will continue.  Harpex is still sluggish, however.

Gallup Consumer Spending number is just crossing:

“WASHINGTON, D.C. — Americans’ daily self-reports of spending increased to an average of $89 in March, up from $84 in February. The latest monthly average matches the highest spending for the month of March that Gallup has found in its nine-year trend of measuring U.S. discretionary spending.”

This is exactly what we would expect if Ures truly is right about one more blast into the financial heavens.

Later this morning, factory orders which should show a few signs of a pulse.

Tomorrow, international trade.  Petroleum data comes Wednesday, Thursday afternoon has a biggie:  Consumer debt (which they call “credit” because they are creditors).    Wholesale trade and oil rig counts Friday.

All in all, it’s a Monday.  What can I say?

And in Other News

We can skip most of the presidential nonsense.

Greece Begins Sending Refugees Back as EU Deal Takes Effect is somewhat interesting, since it will increase pressure – and who knows, maybe set up a conflict line – between the Middle East and Europe.

An airline mega-merger is in the works with Alaska Airlines Parent to Buy Virgin America for $2.6 Billion in Cash.

And the MinWage is going up as the “:California governor set to sign $15-an-hour minimum wage law.”

Now the Really Important Stuff:

A 2,6 TB of leaked data about the very rich and very powerful of the world has been leaked in what’s being called “The Panama Papers.”

The UK Guardian has the real details over here and this is a biggie.  Outs colleagues of Vlad Putin and their offshore dough.  Lots of other global officials are outed, as well.

In the end, we already know what the simple take-way is:  The world is run by a corrupt layer of the uber-rich who are feathering their own nests at the expense of the working class. 

The 1% of the 1% are making a killing.

Of course, you’ve always know that there is global corruption, this just makes it more clear and how much dough is involved.

We will await the data scanning to see if any US presidents or formers (or currently running) get implicated.

If so, then the fun has only just begun.

It’s the kind of story that makes getting up on Monday worthwhile.