Hysteria Seems To Be Bubbling Up

Hysteria is uncontrollable emotion or excitement. It seems to be bubbling up more than usual these days. Normally, there's always a simmer going on. And maybe perception has overwhelmed reality, but it sure does seem that some one's turning up the heat and we're headed to an outright vigorous boil.

Picture a huge caldron filled with water, better, let's say steel. If you're not a steelworker, you've likely seen something in a movie that depicts this. The molten steel in a huge container that's moved mechanically. It pours the molten steel into something. It's always an awesome scene, laced with fear. Maybe steelworkers get used to it, but the rest of us can't imagine being close to such a thing.

Stepping back from the movies to reality, who's turning up the heat these days? Lots of sources out there. 

First, let's acknowledge that new administrations - particularly when there's a switch from one party to the other, kick up the dust a bit. Think of Democrats when Bush Jr. stepped in, or Republicans when Obama arrived. But doesn't this new administration seem to add a bit more (or a lot more) spice to the usual recipe? 

And that spicier start has not simply been a matter of taste or perception. It seems that certain taken in these days since the Inauguration pack a real wallop:

- The whole DOGE effort to trim the federal bureaucracy

- The "round-up" of non-citizens that include not simply illegal immigrants with criminal or other suspicious backgrounds, but some who seem not to pose any clear and present danger to the country.

- The chatter about Social Security being a "Ponzi Scheme" accompanied by reductions in staff and SS offices throughout the country.

- The increasingly aggressive imposition of tariffs on countries formerly seen as allies, even friends, accompanied by retaliatory tariffs by said countries.

Three's more, but we'll leave it at that. To be sure, there should be nothing surprising in much of what has transpired. The personality style of the President is not a surprise to any who have followed his career from this early days in real estate development, through various media ventures, and other public actions and statements. The stated objective of changing the current order of things was made clear during the campaign. The effort to follow through should not shock anyone. Perhaps it's the speed and intensity of those efforts that has roiled folks more than one might have anticipated. 

Even if we dismiss or minimize those reactions from the usual suspects who simply cannot tolerate the Big Orange Guy, many others who have not animosity towards him, and who may even have voted for this crew are in a bit of a tizzy.

And at extremes we sense the bubbling up of a kind of hysteria related to some key actions being taken so far. 

Now, hysteria would not surprise from the contingent that has seemingly always (at least since he ran for his first term) the current President. Some combination of political and personal animosity drove folks off a cliff when he was elected in 2016. But this go-round seems to have a different flavor. The sheer number of court injunctions, law suits, public displays of anger, etc. have been ratcheted up to what one can easily see as an extreme. (Or maybe we're only approaching extreme.)

In addition to the usual suspects, though, some slug of folks who actually voted for the current resident of the White House are at the least scratching their heads, if not openly disavowing their former support.

And with a growing number of folks questioning the means, the content, if not the intent, of various Executive Orders, public statements, actions taken by various agencies, etc. there's simmering going on that could - depending on actions taken in coming months, also turn into a rolling boil.

So maybe we're not in full-blown hysteria mode - except for the usual suspects - but we may be heading in that direction. Perhaps all it would take would be a deep (even if brief) recession and/or a stock market crash, with the added kicker of a credit crisis to turn up the temperature. (All or which are definitely not out of the question.

Is there some silver lining we might find in the current clouds hovering over our economic lives? Sure. And maybe it's the obvious: investment opportunity.

Those who have raised cash in recent months may be positioned to sweep in and scrape up the droppings of hysterical investors who unceremoniously dump stocks into the teeth of a Bear Market caused by a crash. Of course, the time to buy will be the time that takes the most courage. And there's always the danger of picking up stocks that aren't nearly crushed enough, causing initial losses that would frighten to faint of heart into selling what they thought were bargains.

Better to have a reasonably positioned portfolio now that will not crater in the face of a crash.

Better still to have reserves in place - money, as well as hard goods, including food stocks - that can weather any steep recession (or worse). Not that such is an easy task, but it's worth a shot. Worse comes to worse, you're at least somewhat hedged against the fear of running out of money and food, and you've got a car that's in decent shape, with sufficient reserves to pay your rent or mortgage.

Best would be that, with the knowledge that you've prepared, you don't join in the full-blown hysteria - if it comes to pass. Just lay low and count your blessings.