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The 2022 Ravens are Over-Rated: The Argument

There are – or should be – big concerns regarding the 2022 Baltimore Ravens. This is a team that, as we sit here today, may be significantly over-rated. Let me make the case that the 2022 Ravens are Over-Rated.

Holes on the Roster

I’ll preface this discussion by noting the obvious. The Ravens roster as of game one is a bit of a mess. Nevertheless, taking the roster as it sits, edge rusher is a mess, interior linebacker is a mess, the offensive line is full of question marks, the wide receiver room is untested, and Lamar’s refusal to work out a deal with the Ravens hangs over him and the team.

Ravens Over-Rated Argument Number One – Abundant Health Red Flags

Everyone knows about the devastating injuries in 2021. But the flip side of last year’s injuries is the risk to performance of the affected players in 2022. None of the players listed below has set foot on the field yet, so to assume there’s no material risk of any lingering health problem is imprudent. Ravens over-rated

The most important player in this group is Ronnie Stanley. What are the Ravens going to get out of him, if anything? The contingency plan is atrocious. Ju’Wuan James? Don’t make me cry. Patrick Mekari? He can man the right side but not the left. No doubt the upside case for the 2022 Ravens is dependent on Stanley producing at a high level. And even if he manages to come back and play at a decent level, given the magnitude of his injuries, durability will always be a high concern. This is a very fragile situation. Continue reading “The 2022 Ravens are Over-Rated: The Argument”

Ravens’ 53 Man – A Couple of Roster Thoughts

I’m not going to do a traditional “who’s on the Ravens’ 53” analysis in this piece. Instead, a couple of thoughts on who should be in/out, and some miscellaneous.

Offensive Tackle

Wow, after all of this time the Ravens 2022 season seems completely dependent on how much of the old Ronnie Stanley we are going to see. And we just don’t know. There’s no reasonable Plan B here, as there’s no way that Ju’Wuan James is the answer, and Patrick Mekari is not on the Ravens’ radar for that spot. We are left with one thing – hope that Stanley can play, and play well-enough. The balance of the tackle slots are clearly set (Moses, and Faalele). Continue reading “Ravens’ 53 Man – A Couple of Roster Thoughts”

President Biden Solves the Baby Formula Fiasco (Satire)

Political strategist Anita Dunn marched into the Oval Office this past Friday morning. “Uncle Joe, the polls are in, and I’ve got news.”

The President, rummaging through his desk, lifted his head towards Dunn and smiled. “I’m still doing great, right Susan.”

Dunn didn’t miss a beat. “I thought I’d bring these over right away. We discussed our situation and I’ve come up with a new strategy that we’ve decided you should implement immediately.” She offered the President a single piece of paper with one sentence typed on it in 48-font.

“Look, Jen, I don’t believe in new strategies. What need do we have for strategies? Number one. I like to say things as they come to my mind. Number Two. When I sometimes discuss a topic and something manages to come to me somewhere between how I speak about those things and then the other things that’s going around and just get a damn shot already! And take that mask off, there’s no cameras in here. Now give me the poll numbers.”

“Do I have to?’

“Yes. Yes! It’s Friday and we’re on our way to Scranton.”

At that moment Dr. Biden walked in, suitcases in tow. She rested her right hand gently on The President’s arm and said reassuringly “Joe – Friday means Delaware. The beach house.”

The President seemed a bit bewildered, then mused, “Beach house? You mean that Camp David? Oh, the Beach House, the one that Jim bought us.” Looking back to his advisor the President beckoned, “All right, Neera, hurry up now let’s get the score. Is it the fourth quarter yet?’

Dunn was hardly flummoxed. “Well, yes, Mr. President, it is just about the fourth quarter.”

“Great, great, who’s winning?”

“Uncle, it’s not looking any better. Monmouth’s approval rating has us at 38% and . . .”

The President interrupted, “That’s GREAT, certainly heading in the right direction. Jill, do you have the car keys I thought they were in the desk inside my Obama bobble head but I can’t find them.” The President looked up at Dunn.

“What else, Kamala, do you have something else for me? Ooh, what’s on the paper?”

“I don’t want to upset you, but the poll says 80% of the country thinks we are on the wrong track.”

The President peered deeply in Dunn’s eyes. ‘Neera, don’t worry. I’ve unified the country, we’re just getting started. Now, what’s on the PAPER?”

“Mr. President, this is what we want you to say at all your next stops. We’ve cleared it with CNN, MSNBC, CBS, ABC, the Post, the Times, and NBC. In fact, they’ve already started.”

“Great, great. Jen, you do great work with the press I don’t have to remember anything at all, just give me the list and off I go” The President beamed, while slapping his right knee. He glanced at the paper Dunn handed him. “Ultra-MAGA. What is that?’

“Mr. President, our consultants – well me, really – tell us that we can turn this thing around if we just label every Republican in America an Ultra MAGA. Our base finds the word MAGA repulsive. And when you add the word Ultra in front of it – well, they just go bonkers. So, say these words wherever you go, and our people will turn out in hordes come the November election.”

The President jerked his head up, panicked. “November election? Susan, there’s no time for me to do a whistle-stop campaign.” The President began feverishly opening and closing his desk drawers. “Did I miss the debates? Is it Trump again? I can take that bastard.”

“Sir, no, you’re not running this November . . .”

The President interrupted Dunn. “What do you mean I told you I wanted eight years!” The President paused, his eyes rolled upward as he reflected, and then said “Oh, that’s right, I already won re-election – beat the SOB again, whoopee! Susan, can I have 12 years?”

Dunn ignored the President and pressed on. “But there’s one thing, Uncle Joe. Ultra MAGA will bring us victory, your ratings will skyrocket, and you’ll be seen as the greatest President of all time if . . . “

“Neera, everybody knows I’ve got an IQ of 185.” The President swiveled his chair and turned to the First Lady. “Told you I’m the smartest President, ever! Send a note to Corn Pop.”

Slightly perturbed, Dunn tried to get the President back on track. “Now Mr. President, as I was pointing out, all you’ve got to do to get everything going again is say Ultra MAGA wherever you go, but . . .”

Again interrupting, the President turned back towards Dunn in a moment of sensational awakening, exclaiming “Kamala, I’ve got it now! Ultraman! Ultraman!!! Damn this is exciting! Are we going to Japan? Better than Superman!” The President began singing: “The mark on his chest is a meteor. In his favorite jet he strikes his enemies. Here he comes our Ultraman!”

Dunn continued, oblivious to the President’s meanderings. “But the NIH conducted brain scans on some volunteers and found out that the repulsive reaction to Ultra MAGA only lasts for 60 minutes.”

“Is it Sunday already? Jill, it’s Sunday, I’ve got to brush my teeth again. Great show, just saw Mike Wallace interviewing what’s that death guy’s name, Kerkorvian? A woman should control her own body, you know,” The President smiled. “It’s just like I told Robert Byrd back in the day” The President said, a teardrop forming in his left eye. “George Wallace isn’t a bad guy once you get to know him.”

Dunn plowed on. “They found out if we just get them to swallow a bit of this stuff,” she said, gesturing a tiny vial filled with fluid towards the President, “the revulsion to Ultra MAGA intensifies by 1000 times and lasts four to six months. Dr. Fauci calls it the Magic Elixir”

The President’s smile flipped into a frown. “Jesus, Jen, I’ve already taken that Covid stuff seven or eight times. I just can’t do it anymore.”

Dunn reassured The President, then said, “Well, you’re right about that Mr. President. The original plan was to put the Magic Elixir in the second booster shot but then we realized that no one would take it. . .”

“Who the hell would!” The President quipped. “Jill, do you have the keys, we’ve got to get to the Amtrak station before the train leaves?”

“The NIH did some further studies and found out that swallowing only a specific combination of protein, fat and fatty acids, and carbohydrates will make the Magic Elixir effective.”

“Some specific combination of what, where, who? Come out with it woman!”

Dunn spoke purposefully. “Well, you see, Mr. President, there’s only one combination of ingredients that makes the Magic Elixir work. It’s contained in a baby formula known as Simulac.”

The President jumped up from his desk. “Smack? Jill, see if you can get Hunter on the phone . . .”

Dunn interrupted. “No Mr. President, Simulac, the baby food formula.”

“Oh, Oh I see. Jill, belay that order! Where’s General Milley?” The President turned back towards Dunn “Then get it, man, I’ll issue an order! What’s that again, Kamala, the Production Defense what?”

Now it was Dunn’s turn to smile. “We’ve already taken care of it, Mr. President. We’ve been buying up all of the Simulac on the market. Used excess funds from the cancelled border wall. We’ve been storing it down in Texas where nobody will find it. It’s being prepared in the form of a milkshake. We’ve lined up McDonald’s, Burger King, Kentucky Fried Chicken and others to distribute it for free. All you must do is keep repeating Ultra MAGA whenever a camera is on you.”

The President seemed pleased. “Milkshake, well that’s fabulous. Get me one of those large chocolate McDonald’s milkshakes.”

A harsh look came over Dunn’s face. “Mr. President, no chocolate – it’s racist.”

“Oh, of course. Racist! Forgive me!” Squeezing his thumb and forefinger together the President whispered, “But maybe I can get a small chocolate shake?”

“Sorry sir,” Dunn replied. “That’s a microaggression.”

The President, joined by Dr. Biden, headed towards the door of the Oval Office. “OK Neera, great job. We’re off to Camp David. Barack’s supposed to meet us. Jill, you drive. I’ve got it now, Jen. It’s kind of like saying abracadabra.”

Dunn waived goodbye to the President and yelled after him, “Remember, Mr. President, Ultra MAGA.”

With that the President and Dr. Biden were gone. Led away by secret service agents he turned to one of them and said, “You ever seen Ultraman?”

Cast of Characters:
Joe Biden as Uncle Joe and The President
Jill Biden as Dr. Jill Biden
Anita Dunn as Anita Dunn, former Senior Advisor to the President and
political strategist
Anita Dunn as Jenn Psaki, former Assistant to the President and Press
Secretary
Anita Dunn as Susan Rice, Assistant to the President and Domestic
Policy Advisor
Anita Dunn as Neera Tanden, Senior Advisor to the President
Anita Dunn as Kamala Harris, Vice President of the United States

Federal Reserve Interest Rate Increases: Too Little, Too Late

It’s a bit too little and too late for the Federal Reserve. Do they really believe that a 3% year-end Fed Funds rate will tame 8% “official” inflation? Maybe inflation will “naturally” drift back down (though there’s no empirical data to support that view). The Fed can hope, though. They can try a little prayer if that’s still ok. Maybe a stock market crash will do it, who knows. But powerful inflationary forces are just beginning to warm on their way to a boil.

The Fed has been horribly wrong about almost everything for at least a decade now. They locked the forever money printing presses in the on-position. They thought they could grow the money supply to the moon, right out of the modern monetary theory textbook, without any adverse consequences. “Targeting” two percent inflation, for years these smarter-than-us helmsmen were puzzled that money printing just wasn’t producing inflation. They “tamed” it. Their mantra was inflation is no risk. And they slept on. But then the lion roared, and they seemed shocked that massive asset price inflation was followed by massive every other type of inflation. Continue reading “Federal Reserve Interest Rate Increases: Too Little, Too Late”

The Huge Financial Risk of Enormous Government Debt and Obligations

The extent of the federal government’s obligations, both current debt and future unfunded liabilities, is a huge financial risk looming over the U.S. economy. The astonishing size of these obligations – and their massive divergence from historical norms – can’t be understated.

Debt Has Exploded to Record Levels – And Is Heading Much Higher

The easiest way to see this problem is through the lens of government debt as a percentage of US gross domestic product (GDP). What I label “Debt” is the combined total of federal government debt plus the Federal Reserve’s balance sheet. At the end of World War II, Debt stood at 135% of GDP.¹ After the war, Debt as a percentage of GDP steadily declined to an average of approximately 30% during the 1970’s and into the 1980’s. Even as recently as 2010, the Debt stood at approximately 50% of GDP.

But by 2020, federal government debt portion of the Debt exploded higher. It alone reached 80% of GDP. At the same time the Federal Reserve’s massive money printing ballooned its balance sheet to an incredible 40% of GDP. The federal government’s debt skyrocketed further over the last two years. It alone now stands at 100% of GDP (closing in on the World War II high), and the total Debt now stands at 140% of GDP.

Enormous Entitlements Problem

This frightening picture of financial risk is incomplete. The enormous amount of unfunded federal entitlements must be painted in. They had little meaningful impact in the 1940s. But as of 2021 the present value of the combined unfunded Social Security and Medicare obligations stands at $163 trillion – over 700% of U.S. GDP!² These entitlements cannot be paid. And, there is no way the government can inflate its way out of this problem.

huge financial risk

The Congressional Budget Office’s Debt Projection

Now, layer on the Congressional Budget Office’s forecast of the growth of government debt. It assumes no growth in the government debt portion of the Debt for the rest of this decade. That seems highly improbable, particularly if the U.S. has a meaningful recession, which is a real possibility. But even the CBO projects that starting in 2030 U.S. government debt will enter into a period of extreme growth as a percentage of GDP, reaching 120% by 2040 and 165% by 2050.

Debt and the Coming Debt Spiral, is a Huge Financial Risk

This picture makes clear that the U.S. is heading into a debt spiral. No amount of quantitative easing can prevent it. It illustrates why the government has a huge incentive to try to cheat its way out of the problem. But it can’t. Those who believe the U.S. can simply inflate its way out of this problem don’t understand it. No one who appreciates the enormous risk created by this debt problem could responsibly suggest adding meaningfully to it. Yet, that’s exactly the course of many political “leaders” – they are either foolish, stupid, or worse.

The Housing Price Boom is Unsupportable – A Major Correction is Coming

The extent of the housing price boom can’t be understated. It is an order of magnitude worse than the previous housing price boom at its peak in 2007. The Federal Reserve’s decade-long wild and irresponsible money printing, including hundreds of billions of dollars poured directly into the housing market, has been the fuel that caused this explosion. All of this and more is about to reverse, and a major housing price correction is at our doorstep. Continue reading “The Housing Price Boom is Unsupportable – A Major Correction is Coming”

Equity Market Valuation Is Way Too High – At An Historical Extreme

Life’s experience is a template for recognizing life’s extremes. There are so many things out of place in U.S. financial markets that one almost doesn’t know where to begin. But here’s one that’s a good indicator that equity market valuation is way too high. Generally speaking, the growth in equity market capitalization – using the S&P 500 as the measure for market capitalization – should bear a relationship to the growth in the U.S. economy as measured by GDP.

Equity Market Valuation and Buffett’s Favorite Indicator

Warren Buffett called the relationship of market capitalization to GDP “the best single measure of where valuations stand at any given moment.” So let’s take a look at it through the lens of history. Equity market valuation

Over the last two years, the relationship between S&P 500 market capitalization and GDP became unhinged. Market capitalization reached 110% of GDP in 2018. By the second quarter of 2022, the ratio exploded to almost 170% (the prior all-time high was 120% right before the dot-com crash over 20 years ago).

But then add the value of private equities to the S&P 500 market capitalization. Look at the ratio between this total equity valuation to GDP. What do we see? Previously, the all-time high in the ratio between total equity capitalization to GDP was 180%. This occurred immediately prior to the dot-com crash (data goes back to the early 1960s). In 2020, the ratio reached an all-time high of 200%. Now, that ratio is approximately 280% of GDP. It is 40% higher than the all time high.

The Federal Reserve shoulders most of the blame for equity market valuation reaching such lofty levels. There is a big price to pay for what the Fed has done over the last 14 years. That’s worth more than one other discussion.

But for now, a dramatic break to the upside in these ratios means this. Equity market valuation has grown much faster than the U.S. economy. In fact, it has de-coupled from the growth of the economy. That makes no sense. It can’t continue. And it won’t.

Ravens Draft Recap 2022 – Two Perspectives

Time to do a Ravens draft recap for 2022. Eric DeCosta and his team had an excellent draft, my reservations notwithstanding. Sure, the national draft “gurus” are “grading” the Ravens as A or A+, but none of that really matters. I think we should look at this draft from two perspectives.

How Does This Draft Set Up the Ravens for 2022?

This is the most immediate consideration because it’s all about trying to get this year’s version of the Ravens to the promised land. Remember, the draft is just one tool – the biggest tool – in roster construction. Free agency part one (which is over), free agency part two (which we are now entering) and finding gems in the undrafted free agent pool are also key ingredients. Continue reading “Ravens Draft Recap 2022 – Two Perspectives”

Ravens 2022 Draft – Day One Recap and More

Wow, I certainly didn’t see that coming! Eric DeCosta bet his career last night, with the most curious draft selections, arguably, in Ravens history. There’s a lot to unpack here in this day one recap and I almost don’t know where to begin. But I’ll say this right off the bat. I don’t buy it.

How to Build a Championship Team: First, Identify What You Need

The Ravens entered the off-season having suffered the worst collection of major injuries last season of any team in the last ten years. With the return of those players, they see themselves as being very close to the top of the league. Continue reading “Ravens 2022 Draft – Day One Recap and More”

Ravens Big Board – The 2022 Draft

It’s draft day! Finally, the Ravens Big Board is here. Let me explain for a moment the purpose of this Ravens Big Board. It is not a ranking of all prospects such as you typically see on numerous websites. That type of ranking is not really useful in figuring out who the Ravens will target. The goal is to find who fits what the Ravens try to do, and which players bring to the table what the Ravens most need. Therefore, my Ravens Big Board is intended to list, by round, which specific prospects I think the Ravens should draft, roughly in that round.

Then there is the draft analysis. Obviously, the draft can go a million different ways for the Ravens – starting right away in the first round. I try to deal with some of the possibilities in setting my priorities, and I explain some of these scenarios. But there is no way anyone can predict them all, and neither can I.

So, I begin by augmenting the analysis I started in the Round One analysis post (look here). Continue reading “Ravens Big Board – The 2022 Draft”