There’s eventually a stock market point.

Renee Good was shot and killed by ICE in Minnesota on Wednesday. Two things struck me:

–in the dim past (i.e., 1968), my first duty station as a newly-minted second lieutenant was with the 5th Mechanized Infantry at Fort Carson, Colorado. Shortly after I arrived, we were shipped off to the Great Lakes Naval Training Center outside Chicago, on the idea that having federal troops nearby would discourage protesters from gathering outside the Democratic national convention.

The 5th contained a large contingent of Vietnam veterans, some recovering from wounds, most suffering from PTSD. A major concern was the rules of engagement, i.e., under what conditions were we allowed to use force to defend ourselves (there were news reports, for example, that protestors intended to blind troops by throwing lye into their faces–and that all the lye in stores around the convention had suddenly been bought).

Official guidance was very wishy-washy, but the message was crystal clear. Never harm an American citizen, and if you do, even to defend yourself, you’ll be prosecuted and jailed. Not a great testament to our leadership, or at least where we soldiers stood in the pecking order, but the rules were clear: –never harm a civilian.

In the case of ICE today, I see two possibilities: either, in a shocking absence of leadership, there are no guidelines on the use of force, or–worse–the guidelines call for gratuitous violence. Both are scary. I don’t see any other interpretation of the killing of Renee Good, however, or what appears to be the subsequent coverup by the administration.

–in the dim past, in the 19th century, Marx expected the political evolution to communism to take place in Germany. That’s because at the time it was the most highly industrialized country in the world–and therefore the most severely abusive to workers. As it turns out, the revolution eventually occurred in Russia, a heavily agrarian society and in theory the most unlikely place for the transformation to happen. How so? Lenin. His idea was that revolution required a trigger, a “vanguard of the people,” made up of professional communists willing to use violence to overthrow the existing order, even though this would be against the wishes of the great majority of citizens. ICE today?

stock market relevance

The key to stock market success in the US last year was to recognize administration-induced currency weakness and respond by shaping a portfolio to overweight companies with $US costs/foreign currency revenues and underweight the opposite.

This hasn’t changed, in my view. Nor has the market preference for companies whose US presence consists mostly of people and other intellectual property that can be easily relocated. I also think that Hong Kong-traded Chinese tech firms will continue to prosper.

What I think is new is the deepening reputational damage being done to the USA brand by things like ICE. At some point, though, I think foreigners will become interested in US brand names that have been pummeled by the negative combination of tariffs, ICE, and the administration’s continuing desire to weaken the dollar. I’ve been nibbling at a couple over the past few months. I’ve clearly been too early. But I think this is the next step in the domestic market’s evolution–picking through the wreckage. Recent stock price action, however, says there’s still more bad news to come.