On My Radar: Commercial Real Estate - Office Rental Woes, Banking Exposure, Systemic Risk (?) - CMG

On My Radar: Commercial Real Estate - Office Rental Woes, Banking Exposure, Systemic Risk (?) - CMG

Commercial Real Estate – Office Rental Woes, Banking Exposure, Systemic Risk (?)

Lights up on my call with a banking insider: 

My friend Dan has been an On My Radar reader for a number of years. He has extensive experience in the CRE world—including with all property types and in all market conditions—having worked on over 800 transactions with a total value exceeding $26.3 billion, spanning development, ownership, repositioning, restructuring, and lending. Commercial Observer recognized him as one of “The Most Important Figures of Commercial Real Estate Finance.” 

Dan reached out to me after reading one of my recent newsletters. He believes that with the tumultuous state of the commercial real estate market, investors should seek protected risk-adjusted returns, which can be achieved by proper evaluation and structuring of investments at a lower basis in the Capital Stack.

Below are a few slides Dan gave me permission to share with you. I have included notes from our discussion. The first slide sets the stage. It’s information you know, but it’s always good to review: 

The key is the last statement: “This environment encouraged borrowers to pay higher prices for assets, including real estate.” 

Inflation followed: “The increase in rates has put incredible pressure on both borrowers and lenders.” 

Perhaps the most telling slide in Dan’s presentation is this next slide.  

Here are the basics: 

• Deals were done where the asset buyer put up 35% of the equity, and the bank financed the remaining 65%. That’s 65% debt to 35% equity. 
• At the time of the acquisition, the property generated $4.25 million (net operating income). 
• But now, since financing costs have increased so much, the net operating income generated from property rents has decreased. In the case of commercial office space where we have high vacancies, it’s even worse. 
• So, the value of the building is now worth less. 
• The challenges come when the buyers need to refinance the loans.  
• The bar on the right in the graph below assumes the cap rate increases to 6%, which reduces the value of the property from $100 million to $70.8 million.  
• Under this scenario, the bank will resize the loan to $46 million, down from $65 million.  
• As a result, the property owner will lose $29 million, so they need to find some rescue capital in order for a new loan to be written.  
• This assumes the property owner is earning enough in rental income to cover expenses, including the higher interest costs.  
• Without rescue capital, the owner turns the keys over to the bank.  
• Thus, “jingle mail.”  

The cost of borrowing has risen sharply. In the chart below, look at the change from pre-pandemic levels to current ones. Ouch!

Dan also sent me a report from Muddy Waters, a short-selling firm that looks for problems and takes short positions to profit in decline. Muddy Waters estimates that one popular REIT (real estate investment trust) fund needs a 180-bps decline in the Fed Funds rate. Otherwise, they’ll have to eliminate their entire dividend payout. I do not have authorization to share the research report.

See the debt maturity calendar below (squared in dotted red). The tipping point is when the loans mature and need to be refunded. I asked Dan about the 2023 debt; he said the 2023 loans have been pushed to 2024, which, surprisingly, the banking regulators are allowing for now. Pretend and extend, apparently. Everyone is hoping the Fed will cut rates by six times or more.  

But there is a short timeline for the ability to avoid the issues; there’s $1.9 trillion due to be refinanced. 

Many large owners have already started defaulting on their properties. And several more have happened since Dan created this slide.

For his own part, Dan previously owned 36 properties. He sold them all a few years ago and is waiting to reenter the market to buy at distressed prices. According to him, there’s no reason to go over the top and buy these assets right now because every banker he talks to says they “have no problems,” but the loans paint a different picture. He says he’s made offers, and they go to their board of directors or board and waive all the covenants. But you shouldn’t be able to do that if you’re an SEC-reporting bank and you’ve got to issue GAAP-compliant statements. This tells us that the Feds have softened their regulatory position (for now). If Dan were still Vice Chairman of a bank, they would have made him reappraise and take write-downs on every single asset. 

I told Dan I’m concerned that the Fed will create a Bank Term Funding Program number two similar to the BTFP they created on March 12, 2023, in response to the banking crisis (SVB, Signature Bank, etc), except that this time, they’d allow banks to push off their bad commercial real estate loans at par. It pains me even to posit that. 

Dan suggested that another possible solution, modeled after something utilized in Europe, that doesn’t involve another government bailout. Europe created a market for synthetic securitizations based on Basil III banking standards that allow you to make what is called a substitution. It involves getting a guarantee from another entity that can issue debt. Think of outside investors putting capital into various pools of different levels of risk-and-reward investment structures. This new capital shifts the risk, allowing the banks to free up capital in their books.  

The challenge is that no banking regulator is currently willing to give Dan and his team an opinion on this. They will only give their opinion directly to a bank. I’m pulling for Dan. 

Concluding thoughts: 

Capital will freeze up in another banking crisis. I believe that the Fed is well aware of the problem, and they’ve certainly shown the will to backstop the system with creative new programs. Dan concluded that we were at the top of the first inning with the first batter at the plate—still early in what is likely to be a big problem unless the Fed takes the Fed Funds rate back down to 3% (my guess) or creates something similar to the Bassel III enabled synthetic market in Europe. However, I really have to learn more about that market. A better solution at face value than putting more junk assets, priced at par, but worth significantly less, onto the backs of the US taxpayers.   

We’ll go more into the size of the problem next week. 

On My Radar: Commercial Real Estate – Office Rental Woes, Banking Exposure, Systemic Risk (?) - btbirkett@gmail.com - Gmail

On My Radar: Commercial Real Estate – Office Rental Woes, Banking Exposure, Systemic Risk (?) - btbirkett@gmail.com - Gmail

Dear Bruce,

“I hope there are days when your coffee tastes like magic, your playlist makes you dance, strangers make you smile, and the night sky touches your soul. I hope you fall in love with being alive again.”

– Brooke Hampton

I really like the Tampa area. Well, except for the football team and the beatdown they gave my Eagles. I’ve been spending the week here, and the temperature reached 80 degrees both Wednesday and Thursday. Much better than the low teens we saw in the Northeast last week.   Wednesday was a full day of investment presentations. Like me, the attendees were investment managers and due diligence offices, with fund sponsors primarily in the multi-family and single-family housing space. That was timely, considering the subject of last week's On My Radar: Commercial Real Estate “CRE” – The Next Big Short? Housing, in general, continues to look favorable to me because of the beneficial supply (low) and demand (high) dynamics. Prices have come down off their highs, as Liz Ann Sonders shared in an X post today (see below). It makes sense, given the period of zero interest rates (a.k.a. free money) we've exited. If mortgage rates drop to 5.5%, as I predict they will, the market should find good support. More than a few will be bidding on the same house.

Higher mortgage rates have cooled new buying activity almost everywhere. Some areas are in better shape than others. The commercial office space situation, however, is another story. Today's subprime-like problem? Possibly. We'll look deeper into it today. But first, back to the conference in Tampa. Four different real estate funds presented. One invests in existing multi-family and student housing. They buy, manage, fix up the units, and increase the rents with the goal of exiting their properties at a higher price. Buy, fix, improve, sell. Two of the funds develop real estate. The fourth fund is creating an entirely new real estate investment category in the vein of professionally managed Airbnb vacation rentals. These properties generate considerably more cash flow than traditional home rentals. Hearing this piqued my interest. It wasn’t just the subject matter of the presentations that was interesting. The format of the due diligence meeting allowed attendees to pepper the presenters with questions. There were some very smart people in the room, and their questions made for quite a fun, Shark Tank–like atmosphere. I was mainly interested in understanding the source of each fund’s debt, financing costs, loan timelines, the willingness of their banks to lend, and other potential stress points. My high-level takeaways are that, at the moment, capital is more difficult to obtain but not impossible. Banks have cut back the amount of money they’re willing to lend. The typical loan-to-value (LTV) ratio is 40– 50%, which is down from 60–75%. That's a material change. Think of it this way: If you were looking to buy a multi-family apartment building for $1 million a year ago, banks would have lent you up to 75% of the cost, or $750k. Today, they will only lend you 50%, or $500k.  Overall, because interest rates are higher, debt costs are also higher, and while the funds can find additional sources of debt, they come at much higher lending rates. Higher funding costs combined with lower lending ratios logically decrease potential returns. Gone are the hot returns of the zero-interest-rate-policy days, but the market generally looks to be in okay shape. The key to the equation is available liquidity within the banking system, and that's where the problems in the commercial office space could come into play.  Bad stuff happens when the leverage ratio gets too high while property values decline. That's the problem in the commercial office market today. Loans are coming due, and since many companies moved to partially or fully remote workforces in the pandemic and, therefore, left office spaces empty, property values have come way down. As you saw in the 60 Minutes video report shared in last week's post, there’s a massive supply of unrented office space. Rents support a landlord's ability to stay current on their loans. Refinancing them is an issue for both the landlords and the banks.  Is this impacting banks’ willingness and/or ability to lend? Yes, and we are just in the early innings. And this can spillover to all other areas that require bank financing and to the boarder economy. In last week's OMR, I raised the question of whether or not this will be “the Next Big Short.” By that, I’m, of course, referring to 2008, when Wall Street guru Michael Burry realized that a number of subprime home loans were in danger of defaulting. Burry bet against the housing market by throwing over $1 billion of his hedge fund money into credit default swaps on subprime mortgage loans. Think of them like put options; you make money when the price drops. He and several others made a fortune from the economic collapse. The crisis put Lehman Brothers out of business and sent then–Treasury Secretary and former Goldman Sachs Chairman and CEO Hank Paulson to legislators begging for a banking bail-out. Great leverage can cause great problems. So, are we on the doorstep of another Big Short? The answer lies in the banking system and the backstops that legislators and the Fed may or may not provide to the system. The office rental woes are real. The uncertainties are the value of the underlying collateral, the level of bank exposure, and the ability of landlords to refinance their debts. Personally, I don’t believe this is as big of a problem as the subprime junk that avalanched the banking system in 2008, and the Fed and legislators have proven they are willing to be shockingly creative, but the risk to the banking system is not immaterial. We will go deeper into the issue today, concluding next week with a piece that gives us a sense of the size of the exposure within the system. Grab that coffee and find your favorite chair. I'm going to share some notes from my conversations with a former banker–turned–real estate investor and another developer friend from the Northwest. He’s been sounding the alarm bell for several months and says what we’ll see next is “jingle mail"—like the sound the keys make in the envelope sent from the property owners to their banks.  You'll find a few telling charts as well, and we’ll look at the cyclical trend in the S&P 500 Index and the 10-year Treasury Yield. Finally, don't miss this week's Random Tweets section. Thanks for reading. It’s time to hit the send button… I’m heading home “to let the night sky touch my soul”… alongside my beautiful wife, Susan. Wishing you and your loved ones the very best.

☕Buy defense stocks, peace is the most important issue of our time - btbirkett@gmail.com - Gmail

☕Buy defense stocks, peace is the most important issue of our time - btbirkett@gmail.com - Gmail

...Many investors insist on buying small stocks because they think they’ll make a killing when they’re discovered. That used to be true but not these days. 

The real money is in buying big companies with the size, scope, and scale to grow in today’s complicated markets. 

Washington hits 80 degrees as January thaw envelops North America

Washington hits 80 degrees as January thaw envelops North America

• (Jan. 28) In an average year, the city doesn't see 80-degree temperatures until around March 28, per the Washington Post's Capital Weather Gang.

Hippy, capitalist, guru, grocer: the forgotten genius who changed British food | Food | The Guardian

Hippy, capitalist, guru, grocer: the forgotten genius who changed British food | Food | The Guardian

Namitech Heating Panels Brochure

 https://nami-tech.com/wp-content/uploads/2024/01/HEATING_PANELS_BROCHURE_EN_compressed.pdf

Elbridge Colby on defending Taiwan and whether a US-China war is inevitable or even imminent - Mauldin Economics

Elbridge Colby on defending Taiwan and whether a US-China war is inevitable or even imminent - Mauldin Economics

Are We on a Collision Course with China?

By Ed D'Agostino | January 19, 2024

   

Before we get to this week’s interview, I want to share a warm thank you to everyone who watched my 2024 market outlook briefing. My goal with all the work I’ve done with John over the years, and with the work I’m doing with the Macro Team today, is to help you navigate a world in flux.

We are at the onset of a shift in the markets. In the years ahead, investors won’t be able to rely on broad-based ETFs to deliver great returns. A different approach is in order, and that is what I’ve spent the past years developing.

As I’ve mentioned before, my team and I use themes to guide our investment research. This allows us to focus on investments that will benefit from the biggest shifts and megatrends.

One of those themes, as I mentioned in my market briefing (click here to watch if you missed it) is the multipolar world. A common narrative I hear is that China is rising while the US declines. It’s a tidy story, but the reality is more complex. A range of countries and regions, including China, are growing their economic, military, and social power, while the US continues to lead the world in nearly every way that matters.

This theme was the impetus behind my latest Global Macro Update interview with Elbridge Colby.

Colby served as the Deputy Assistant Secretary of Defense for Strategy and Force Development from 2017 to 2018. He’s a co-founder of the Marathon Initiative, a foreign policy think tank, and the author of The Strategy of Denial: American Defense in an Age of Great Power Conflict.

We covered so much ground that I had to break this interview into two parts. In part one, which you’ll see today, I asked Colby if we are on a collision course with China. He said “yes.”

Taiwan is one potential near-term war catalyst.

Most Americans have a hard time grasping the tension over Taiwan. Why should the US care about an island right off China’s mainland that’s smaller than our biggest national park? Sure, it makes all those semiconductors, but is that worth going to war over (especially now that we’re reshoring more chip manufacturing)?

Colby says the heart of the issue here isn’t Taiwan, but China’s ambitions to dominate the Eastern Hemisphere, both economically and militarily… and then use that dominance to challenge the US from a position of even greater strength.

Take a look at this chart showing China’s military spending. It’s going up, up, up.

This makes sense when you consider that China feels threatened by the US, as Colby says.

Taiwan has increased its military spending, which you can see in the next chart. Yet it still spends less on defense as a percentage of GDP (2.6%) than the US (3.1%).

Taiwan is a wealthy, sophisticated country. If it wants to retain its quasi-independence—and recent elections there indicate it does—it can afford to bulk up on its own defense a lot more. Colby and I agree that your average American would have a hard time helping a country that isn’t doing everything it can to help itself.

In the interview, you will also hear why the US can no longer afford to act as the world’s policeman, along with other ways tensions with China could escalate in the near term.

You can watch my full interview with Elbridge Colby by clicking the image above.

A full transcript of our conversation is available here.

2024 Macro Outlook Video Presentation Transcript - Mauldin Economics

2024 Macro Outlook Video Presentation Transcript - Mauldin Economics

“Structured equity” - Money Stuff: - btbirkett@gmail.com - Gmail

Money Stuff: Making ESG a Crime - btbirkett@gmail.com - Gmail

“Structured equity”

There are, these days, a lot of startups that used to be worth $1 billion and are now worth $500 million. Some of them raised money at $1 billion valuations, back in the good times, and now they need to raise money again. It is, for some combination of good and bad reasons, extremely undesirable for a startup that raised money at $1 billion to raise money again at $500 million. Therefore there is a business opportunity for a fund that will:

1. Give startups money at a $500 million valuation, but
2. Say that it’s at a $1 billion valuation.

This is called “structure,” or “structured equity.” Bloomberg’s Gillian Tan reported Friday:

Philippe Laffont’s Coatue Management raised about $3 billion for a structured equity fund that allows closely held companies to avoid raising money at lower valuations, a person with knowledge of the matter said.

With the market for initial public offerings in a funk and lower risk appetite from large venture capital investors, some startups have sought to raise convertible notes and pursue structured financings instead of accepting a lower valuation through a traditional equity funding round.

It is always satisfying when a fund has a crisp and simple explanation for how it plans to obtain alpha. “In 2024, startups are desperate to be told that they’re still worth as much as they were in 2021, and we can just tell them that, and they’ll pay us for it.”

Elsewhere:

Investment firms are raising billions of dollars to buy stakes in venture capital-backed technology start-ups, as a long drought in acquisitions and initial public offerings forces early investors to offload their stock at discounts. 

The start-up secondary market, where investors and employees buy and sell tens of billions of dollars’ worth of shares in privately held companies, is becoming an increasingly important trading venue, in the absence of traditional ways of cashing out and given a slowdown in start-up funding.

------------------ 

What do we mean by structured equity? Structured equity is a form of capital that ranks behind debt in order of repayment, but in front of common equity. There are a number of different forms that structured equity can take, but, generally speaking, interest accrues over time but is not charged in cash.

---------

https://www.northleafcapital.com/news/article-structured-equity-flexible-capital-solution-private-equity-sponsors

This article explores two of the more common forms of structured equity: company-level preferred equity and fund-level preferred equity.

USA Shale Production - 5 Things You Need to Know to Start Your Day: Americas - btbirkett@gmail.com - Gmail

5 Things You Need to Know to Start Your Day: Americas - btbirkett@gmail.com - Gmail

On today's Odd Lots podcast, we speak with our Bloomberg Opinion columnist Javier Blas about what's going on the industry. There's a few interesting dynamics here that we touch on.

One is the tech story. Shale itself exists as an industry because of tech. But the tech keeps getting better. Even with tighter financial conditions, producers are still getting better and better at getting more oil out of each well. The industry has also gotten better at standardizing parts, allowing operators to work more efficiently.

Meanwhile, US shale is putting massive pressure on OPEC, with Saudi Arabia recently having undertaken a unilateral production cut in order to put a floor under prices.

It's quite a massive story and the question is how long these set of conditions can last. But at least for the moment, we're seeing high volumes, cheaper gasoline prices, profitable US players, and pressure on OPEC. Quite a combo.

Octavia E. Butler - Wikipedia

Octavia E. Butler - Wikipedia

medical chatbot - the Articulate Medical Intelligence Explorer, or AMIE

What’s ChatGPT’s killer app? - btbirkett@gmail.com - Gmail

Say ‘ahh’ for AI

Would you go to an AI doctor? Google researchers have published a study showing that its medical chatbot more accurately diagnosed respiratory and cardiovascular illnesses in conversations with actor patients than a panel of doctors. Google said the “patients” also gave the chatbot higher marks for bedside manner, finding the bot more empathetic than the human physicians.

Nature, which wrote about the study, noted that the experimental chatbot, the Articulate Medical Intelligence Explorer, or AMIE, hasn’t been used on human patients just yet. It also isn’t a peer-reviewed study. But if chatbots could help assess and diagnose patients, the scientists behind the paper argue, it could democratize access to high-quality medical care and “help realize better health outcomes.”

Graphene: Could it reduce chip-making costs?

What’s ChatGPT’s killer app? - btbirkett@gmail.com - Gmail

Graphene: Could it reduce chip-making costs?

What if the stuff found in pencils could be used to make computer chips? That’s a real possibility, according to new research published in the journal Nature.

Research scientists from Georgia Institute of Technology and China’s Tianjin University found that graphene, the material commonly found in modern pencils, can act as a semiconductor. For years, it was believed that graphene only behaved as a semimetal, not a semiconductor, but researchers have now discovered graphene’s “band gap.”

This breakthrough is notable amid the race to find cheaper and more available alternatives to silicon for the semiconductor technology that powers chips. Chips are notoriously expensive to make, but they’ve never been more important to modern life. Not only are chips necessary for manufacturing cars, appliances, and video game consoles — all of which were affected in the recent chip shortage spurred by the pandemic — but the availability of chips, particularly high-powered graphics chips, is a determining factor in what firms and global powers will enable an artificial intelligence revolution.

Using graphene without wasting scarce materials, however, will require a new production process, so mass-producing chips with graphene could take another “five years to a decade or more,” according to The Wall Street Journal.

#970: Riddle Me a Riddle —Trump

#970: Riddle Me a Riddle —

#970: Riddle Me a Riddle

January 15, 2024  /  Kurt F. Stone

#970: Riddle Me a Riddle

Kurt Franklin Stone

 

Download

(An introductory note: To the gentleman I spoke with at yesterday’s lecture on the making of “Citizen Kane,” please know that I wish you a successful operation later this week.  R’fuah sh’layma” [a speedy recovery],  KFS)

For more years than I care to remember, my typical workout “uniform” has consisted of a pair of grey fleece sweatpants, thick-soled deep black Sketchers, and an Obama/Biden tee-shirt from the 2008 presidential election emblazoned with the slogan “Yes We Can!” Back in 2008 and  on through 2012, the tee shirt garnered quite a few “thumbs up” gestures from my fellow gym rats. After Trump’s victory in 2016, few people seemed to be bothered by the shirt’s sweaty message. During the pandemic years, I began noting a growing number of “thumbs down” - and even “middle finger” salutes; now that we’ve reached 2024, I am beginning to consider putting my beloved workout shirt into the back of my dresser drawer. It’s gotten that bad . . . and I live in one of the few bright blue counties in Florida!

As I write these words, we are a mere 48 hours away from the first figures hitting the airwaves from snowy, blowy Iowa where the nation’s first caucuses will be winding up.  Whatever meteorological kinks and curves will be thrown into the final tally is beyond anyone’s comprehension.  Suffice it to say that even if, as expected, there will be a lot of citizens remaining home, hunkering close to the fireplace, Donald Trump will emerge victorious.  But regardless of the final statistical count, it is highly likely that Trump’s victory won’t provide him with as much of an  electoral slingshot into the New Hampshire primary as he might have expected even a week ago.  A week ago, network reporters blanketed Iowa, asking voters if, regardless of the non-electoral challenges currently facing Donald Trump that they would vote for him, the answers were overwhelmingly positive.  Most of those interviewed by members of the national media proclaimed that they would vote  for Trump because they trust him, think he is far, far better than anyone else for the economy, knows how to handle world affairs far, far better than Joe Biden, and know that he will be the one person who can keep the United States from a second Civil War.

Unlike voters in past elections, these Republicans aren’t voting for their candidate because of any specific policy proposals, for indeed, outside of pardoning the J6 “hostages,” dismantling the DOJ and FBI, and seeking retribution against anyone and everyone who has ever made their avatar’s life a living hell, there are no policies.  The Trump MAGA campaign is well on its way toward becoming the most negative one in at least the past century.  Instead of  past memorable slogans such as "National Unity. Prosperity. Advancement” (T.R. 1904), "Happy Days are Here Again” (F.D.R. 1932), "The Buck Stops Here” (Truman, 1948), "A Time for Greatness” (J.F.K. 1960) and the aforementioned "Yes We Can” (Obama 2008), what do we have in 2024? It’s "Let’s Finish the Job” for Joe Biden and either "Make America Great Again” or "I Am Your Retribution” for Donald Trump. This pretty much says it all; about as much bipolarity as the Yankees and the Dodgers, the Hatfield’s and the McCoy’s, the Jets and the Sharks or, to put my head on the chopping block, between those who act and those merely react.

One of the most telling differences between the nation’s political “approaches” was just summed up in a recently-released Florida Atlantic  University Poll which asked the state’s voters what personality trait they value the most in a presidential candidate. Empathy was dead last, at 4%.  What’s worse is that since the survey’s margin of error was plus or minus three percentage points the true share of people who most want empathy could be close to zero.  Among Democrats, it’s “integrity,” which was the top choice by far, 51%, followed by leadership (20%), intelligence (13%), stability (9%) and empathy (8%).  Among Republicans, the top choice was “leadership,” at 56%, followed by integrity (34%), intelligence (7%), stability (3%) and empathy (0%).  Go ahead; start fearing for the future of the United States.

The Trump campaign, consisting of he who my friend Alan Wald refers to as “The Orange Blob,” and said “Blob’s” 2 sons, are proclaiming over and over and over again that nothing - absolutely NOTHING - has been accomplished on Joe Biden’s watch while, in comparison, everything was just hunky-dory during the days of the Trump Administration.  The litany of accomplishments which Don, Don, Jr., and Eric endlessly stress is that during the Trump Administration, there were “No wars and no terrorists attacks,” both inflation and gas prices were much lower, American leadership was respected around the globe, G-d was in His Heaven and all was right with the world (sorry, Mr. Browning). But since Biden became POTUS (for those who accept this lie, which a majority of Republicans  do not), inflation has gone through the roof, thus wreaking havoc on most retirees retirement accounts; the price of gas and food has skyrocketed, and wars about all over the world. Most, if not all, of these claims can be disproven; they are both factually and morally incorrect.  

Take just a few of these factually absurd claims: in a recent Fox News Town Hall forum in which Donald Trump held center stage (as opposed to being on the debate stage) he asserted: “We had no terrorist attacks at all during my four years.” “I had no wars. I’m the only president in 72 years, I didn’t have any wars.”  For those who want to learn about precisely what did occur during his 4 years in the White House, check out the following Washington Post article.  Then too, there is the Donald Trump, Jr. claim that  there’s not a “single metric” by which “anyone” is better off now than they were three years ago. Say what?  Three years ago – January 2021 – was the deadliest month of the pandemic up to that point – around 80,000 people died from complications connected to Covid-19 that month alone.  CDC data shows that in the week ending 9 January 2021, 25,974 deaths were recorded. For the week ending 9 December 2023, that figure was 1,614. In January 2021, the unemployment rate stood at 6.3 per cent. By last month, that number was 3.7 per cent.

I took a break from completing this essay and went back to researching a clinical trial on a new devise to be used for people diagnosed with Stage 1 diabetes mellitus (caused by inherited factors).  Without getting into the specifics of this trial (they are proprietary), I became rather excited about the prospects of effectively dealing with this costly killer.  Then it dawned on me: one of the greatest things the Biden Administration has accomplished since he took office was the drastic lowering of the price of insulin for the millions of people suffering from diabetes.  Believe it or not _ which MAGA Republicans definitely do not - since 2023, drug manufacturer Eli Lily - with a major push from both the Biden White House and a divided Congress - has lowered the price of Insulin by 70%, which can mean the  difference between life and death for those who suffer. And yet, the Biden campaign has just begun talking about this supreme accomplishment, thus permitting Trump and his MAGA strategists to continue convincing their cult members (many of whom suffer from diabetes) that Biden has accomplished virtually nothing.  These folks know nothing about all the infrastructure programs the Biden/Pelosi-led Democrats have passed which will create hundreds of thousands (if not millions) of good paying jobs in the private sector.    But again, the MAGA Trumpsters refuse to cede a single accomplishment to Biden or the Democrats.  Why?  Because if they did, it might lose them a  couple of votes.

Outside of having a boatload of personal grievances for which he seeks redress, Donald Trump has no platform. Oh, he is still running on building his wall along America’s southern border, repealing the Affordable Care Act (“Obamacare”) “Drill Baby Drill” and hinting at having the U.S. leave NATO. If all of this sounds like the Trump platform from 2016 and 2020, that’s because it is - despite the fact that many things have changed during the first 3 years of the Biden Administration:

• According to a recent Citibank report, “Total gross crude and other liquid exports hit a record of 11.128 million barrels per day, more than the total output of either Russia or Saudi Arabia,” Citi energy analysts wrote on March 1. “U.S. net crude imports fell to lows not seen since the 1950s.”

• According to a recent report from KFF (formerly known as the Kaiser Family Foundation), “Republican voters are far less interested than Democrats in hearing the candidates talk about the health care law, according to new polling data . . . . Only 32 percent of self-identified Republican voters think it’s very important for candidates to talk about the future of the Affordable Care Act, the poll shows, compared to 70 percent of Democrats. . . . . [Moreover}, opposition to Obamacare is a loser with independents: 62 percent viewed the law favorably.

• According to the Center for Economic Policy and Research’s founder and lead economist Dean Baker “We now have the greatest economy ever. I’m saying that because President Biden won’t, and everyone knows damn well that if Donald Trump was in the White House and we had the same economic situation, he would be boasting about the greatest economy ever all the time. Every Republican politician in the country would be touting the greatest economy ever. And all the political reporters would be writing stories about how the strong economy will make it difficult for the Democrats to beat Trump in the next election.”

These are neither lies nor fabrications . . . unless you are a MAGA devotee who fully believes that Donald Trump is the Second Coming.  Those who are willing to read facts instead of ingest opinions, will find it terribly difficult to understand how the Trump minions can swallow such bilge.  One possible reason is that they are just plain stupid and uneducated.  (Sorry to be so damnably nasty and seemingly superior, but that’s just the way I understand things to be.)

So riddle me this riddle: how are progress and a track record of success against the odds ever going to best retrogression, bald-faced lies and a storied past that never truly existed?  By working our tails off, going to the polls regardless of the weather or roadblocks, and redefining the meaning of just who is a patriotic American.  America is just too precious for us - and for the world - to be taken over by the forces of autocracy and bigotry.  Yes, there is a plague of victimization alive in this country; a plague that can never be cured through clinical research . . . for it is a plague created by the victims themselves.

 Remember: There are just 269 days until Voting Day (November 5, 2024). 

 Copyright©2024 Kurt Franklin Stone