My Favorite Trump Trades: Chris DeMuth
"What do we actually know and how can we profit from it?"
As always, I’m stoked to be able to bring you content from one of my favorite investors, Chris DeMuth Jr. Chris took the time to prepare up-to-the-minute thoughts for Fringe Finance subscribers this week.
I enjoy reading Chris as much as I love publishing him. Chris founded event driven hedge fund Rangeley Capital and research service Sifting the World. Rangeley’s strategy is to invest in mispriced securities with limited downsides and corporate events that unlock shareholder value.
Chris also writes the Vale Tudo Substack, which can be found here and the Sifting the World Special Purpose Research Substack, which can be found here.
Chris is one of the smartest people I’ve had the chance to meet during my time as an investor. He was one of the first people to ever to be nice to me when I got my start writing on companies more than a decade ago. His acumen is widely respected by many people whose work I admire and follow - and by me.
All information contained herein is opinion only of Chris DeMuth & does not constitute investment recommendations. Nothing is a solicitation to buy or sell securities.
Every Day Is January 6th
January 6th looms large on the list of complaints about Donald Trump. Interfering with the peaceful transition of power was seen as a threat to democracy. There is a gaping disconnect between how voters see this issue. On the one hand, any such interference is bad behavior. On the other hand, it was an infinitesimally small threat. How close did democracy come to failing that day? Not close. And there is always some threat. Trump supporters tend to focus on the absurdly small threat’s scale while detractors revel in their vindication that he is vulgar and beneath their standards of proper manners.
To indulge the detractors, the most serious qualm is that for a day Trump injected into our system any ambiguity surrounding the chain of command. The US president is the leader of the free world with his finger on the nuclear button. World War III could end human life and as far as we know end universal sentience. Serious stuff. But today and every day of the late Biden administration we live with that same ambiguous chain of command. Every day is a January 6th.
Who is in charge? Actually in charge. The most comforting practical answer is also the most appalling constitutional one: never mind that the president is not running things, the permanent state is humming along behind the scenes as usual. Great. Wait, what? The sheer ordinariness of the president’s infirmity is a scandal. He was lip synching the whole time and the music still plays as he wheezes and wanders off the stage yet the audience is asked to further suspend our disbelief.
The upcoming election will succeed at responding to this threat to democracy to the extent that it clarifies our presently ambiguous chain of command. What would be good for the country? Optimally alignment between the popular and electoral college vote with enough margin that any good faith observer could agree upon the winner. The more we know and can agree upon by the end of election day the better. Our system is strong but that strength will be tested next month especially because the race is so close and more ambiguity is so likely.
There is so much that is unsure about this political season that I want to focus my own effort on a few cinches. What do we actually know and how can we profit from it?