TGIT: DOGE Day Ideals, Deficits and Directional Dalliances

We steelman the market's bull and bear cases, go All-In with DOGE, list what we are thankful for, discuss French whales, the Roman Empire and much more. First time reading? Join other risk-takers, entrepreneurs, traders, investors, data geeks and alpha types. Sign up for free here.

TGI Thanksgiving! In addition to our weekly fare, we’re sharing some of the things we are thankful (🙏) for.  

Besides family and football, the shortened trading week is a great time to go down some rabbit holes. Here’s one of our favorites: The Free Press 🙏, a new, fiercely independent media company founded by journalist Bari Weiss after famously resigning from The New York Times.

In four years, Weiss and her spouse, Nellie Bowles, have built a media empire with a staff of 40 serving more than 750,000 subscribers on Substack. We salute The FP not only for the quality of its independent and objective journalism but also for its influence on Luckbox. Sure, we read The FP daily, but its Friday newsletter (not so coincidentally named TGIF) inspired our own weekly TGIT offering. Hat tip 🎩 to The Free Press! 

And, let’s give some deserved thanks to our valued Luckbox readers. 🙏 Yes, we’ve heard from many of you who miss our print magazine. But we have also received exceptionally actionable feedback (and story ideas!) with respect to our new newsletter format. Because your thoughts are essential to us, please take a moment to complete our annual reader survey. Some of you will be randomly rewarded with a Luckbox t-shirt that will be the envy of your foes! 

On behalf of Yesenia Duran, Kendall Polidori ♥️, Andrew Prochnow, Luckbox Editor-in-Chief Edward McKinley, yours truly (Jeff Joseph) and everyone at tastylive, have a wonderful and Happy Thanksgiving! 

Now let’s get lucky. 

Editorial Director

Last week, we questioned the sustainability of the stock market’s post-election relief rally in The Makings of a Melt-up. But, so far, the public is expressing support for the presidential transition and continuing tariffs on imports from China. They were even onboard when the president-elect telegraphed on Tuesday that he’s likely to impose tariffs on goods from Canada and Mexico, the two largest purchasers of U.S. exports.

The enthusiasm continued with the announcement of Scott Bessent 🙏 as Trump’s pick for Treasury Secretary. Last week, Bessent introduced a "3/3/3" economic strategy: Reducing the budget deficit to 3% of gross domestic product, achieving 3% annual growth and increasing domestic oil production by 3 million barrels daily. Markets responded positively, with stocks rising and bond yields falling and investors are viewing Bessent as a moderate who’s a trustworthy counterweight to populist policies. 

The deficit goal represents a significant reduction from current projections of 6%-7% of GDP. While a 3% growth target exceeds historical averages and most long-term forecasts, it's not unprecedented. However, this goal doesn’t square with Trump's restrictive immigration policies. Increased immigration contributed to recent growth in GDP of 3.2%.

Expanding an economy requires either more hours of work or improved productivity per hour. While deregulation and tax policies might boost productivity, especially with advances in AI, stricter immigration policies could limit the supply of labor. What’s more, some observers are skeptical of the oil production target because the country is already producing 13 million barrels daily.

The current bull market 🙏 in the S&P 500 was confirmed in June 2023 when it climbed 20% from its previous low. At just two years old, this bull market still hasn't reached the typical lifespan of five and a half years. Moreover, its current 60% total return remains well below the historical average of 180% for bull market gains.

This year’s market rally has been nothing short of remarkable, with the S&P 500 and Nasdaq 100 both up more than 25%. The bull market could persist into 2025, and we’ve written an article to explore the reasons why—ranging from resilient corporate earnings and transformative investments in AI to the Federal Reserve’s delicate balancing act. Read Full Story

Still, not everyone is convinced this rally is built to last. The European Central Bank fears a bubble, and some key historical valuation measures hint at a pullback. Here's why the rally may be more fragile than it appears. Read Full Story

Elon Musk and Vivek Ramaswamy will be building their Department of Government Efficiency by recruiting Silicon Valley allies and Trump supporters, including former Tesla board member Antonio Gracias, Boring Company President Steve Davis and venture capitalist Marc Andreessen. Their objective is cutting federal spending through regulatory cuts and layoffs, like Musk's approach at Twitter. They've secured Russell Vought to run the Office of Management and Budget and are considering strategies like mandatory office returns to reduce staff. 

DOGE naysayers are skeptical, citing failed previous attempts at shrinking government and the challenge of reducing the deficit amid Trump’s proposed tax cuts. Mick Mulvaney, who once headed the O.M.B., notably remarked that "going to Mars is easier" than achieving the proposed cuts. 

While the $2 trillion target is admittedly ambitious, we expect that only the perennial partisan resistance will not be on board to applaud the initiative. That’s because the U.S. National Debt just crossed over the $36 trillion mark. That’s $273,000 per taxpayer and the clock is ticking, triggering support for DOGE from a variety of unlikely sources. 

The DOGE duo appears undeterred by the challenges they face, as are the optimistic and ideologically diverse serial entrepreneur/investors who host the All-in Podcast 🙏. Their most recent episode dives deep into DOGE.

46 million 

Turkeys Americans will consume this Thanksgiving Day.

— U.S. Department of Agriculture

Dr. Jim Schultz 🙏 just added an installment on trading volatility to his highly regarded Options Crash Course 🙏 YouTube video series. In this comprehensive session he demonstrates how shifting your focus from directional-biased trading to volatility-inspired trading will transform your results. You’ll see practical examples of how to use both short premium strategies (strangles and put spreads) and long premium strategies (calendars and verticals). Watch the video here.

The French Trader Who Won $85 Million on Trump's Win 🐳 

Meet "Théo," the mysterious French "whale" who just pulled off the most audacious election bet in history—turning $80 million into a staggering $165 million by predicting Trump's victory when every major pollster called it wrong. His secret weapon? A brilliantly simple polling question that uncovered what other surveys missed. Using YouGov data and his Wall Street expertise, this anonymous investor outsmarted America's entire polling industry and walked away with the biggest political prediction market's 🙏 betting payout ever recorded. Discover how a single question about neighbors revealed the hidden truth of the 2024 election. Read Full Story

Stop Thinking About the Roman Empire 🏛️ 

And maybe Hollywood will stop making movies about it. We hate to be haters, but we think Rotten Tomatoes is a bit generous with its 71% Tomatometer rating for Ridley Scott’s long-awaited Gladiator II.

Scott’s sequel faithfully picks up on the original Gladiator 🙏 storyline some 16 years later. Rome’s a sh*t show with syphilitic twin emperors hosting spectacles that would make Dana White envious. The extravaganzas are replete with beasts that didn’t exist in that millennium. Fortunately, Lucius (Paul Mescal), the lost son of the hero Maximus, returns to Rome as a gladiator, gets wind of his bloodline and once again takes to the arena to thwart the emperor’s corrupt rule.

The historical inaccuracies did offer some moments of unintended humor, most notably when a Roman nobleman was reading a newspaper even though the printing press wouldn't be invented for another 12 centuries. (As former print publishers, we expect the font to be Times New Roman.) 

Nevertheless, the film is expected to gross much more than the estimated $250 million it cost to make and the additional $100 million spent to promote it. And, yes, it does sprinkle some entertaining battle sequences among the long stretches of awkward and slow-paced dialogue. We award it three (out of five) luckboxes. 

More Cowbell

Mandate? A look at the 2024 election’s demographic shifts that produced a GOP trifecta.
 

Axios describes Trump’s picks as perhaps “the most ideologically diverse cabinet of modern times.”

A sober look at RFK Jr.’s positions on fluoride, food additives, raw milk, vaccines and Covid policy.
  
This Knowledge at Wharton podcast shows how eliminating bias and noise makes you a better forecaster.

Anarcho-capitalist President Javier Milei reveals a bold plan to rescue Argentina's economy.
 

Paul Krugman fears crony capitalism is making a comeback.

Last call: Please take our annual investor survey. You may win a Luckbox tee!  

Share the Luckbox—forward to a friend.
Subscribe for free here.

Now go on, get lucky.

Luckbox Magazine is a product and service offered by tastylive, Inc. (“tastylive”). Luckbox Magazine content is for informational and educational purposes only. It is not, nor is it intended to be, trading or investment advice or a recommendation that any security, futures contract, digital asset, other product, transaction, or investment strategy is suitable for any person. Trading securities, futures products, and digital assets involves risk and may result in a loss greater than the original amount invested. The information provided in Luckbox Magazine may not be appropriate for all individuals, and is provided without respect to any individual’s financial sophistication, financial situation, investing time horizon or risk tolerance. Transaction costs (commissions and other fees) are important factors and should be considered when evaluating any securities, futures, or digital asset transaction or trade. For simplicity, the examples and illustrations in these articles may not include transaction costs. Nothing contained in this magazine constitutes a solicitation, recommendation, endorsement, promotion or offer by Luckbox Magazine or tastylive, Inc., or any of its subsidiaries, affiliates or assigns. While Luckbox Magazine and tastylive believe that the information contained in Luckbox Magazine is reliable and make efforts to assure its accuracy, the publisher disclaims responsibility for opinions and representation of facts contained therein. Active investing is not easy, so be careful!