Why I Don’t Eat Pancakes
Or watch the news
“You gotta try the mascarpone pancakes.”
That’s according to the gentleman hosting a breakfast meeting at the table next to me. I did not try them. Neither did his guests.
I wasn’t being nosey; it was hard not to hear him. Dressed in a huge off-the-rack blue button-down shirt and forgettable tie, he took the shape of Sherman Klump in the 1996 Eddie Murphy movie Nutty Professor.
Mascarpone, if you’re unfamiliar, is a decadent Italian cream cheese. I’m not sure it’s a necessary food condiment in any situation. Certainly not infused into pancakes.
He must place this order several times a week. He barely missed a beat making the request. He carried on conducting his unique form of business while prepping for the feast.
Most notably, this involved draping a fine linen napkin across his chest, tucking the corner of it behind the knot of his necktie. To my surprise, nobody at his table found this odd. If they did, they didn’t show it.
They needed something from him. He likes it that way. And to hear the big ask, he sits squarely at his corner table in Lafayette, the lobby restaurant of the Hay-Adams Hotel in Washington, DC.
You might know the Hay-Adams. Obama stayed there before his inauguration in 2009. Fictitious president Frank Underwood in House of Cards stayed there after he resigned from office. I doubt Joe Biden will stay there when they wheel him out, but he could.
It’s right across the street from the White House. So close, if it weren’t for the half-a-dozen barricades, armed guard towers, and 400-yards of perfectly manicured grass, you’d be able to see right into the West Wing.
A Different World
People in Washington barely know the rest of us exist. If it weren’t for the ~$6 trillion harvested from U.S. GDP each year, they wouldn’t know there was a country attached.
It’s a nice city, with class. People dress up. I miss that in other parts of the country. If you’ve been on an airplane recently, you know we’ve abandoned a respectable dress code entirely. Anything goes. But not in DC. There’s a standard, and it’s high.
Breakfast at Lafayette is choreographed. They use real silverware, hand-polished by the staff. They iron the tablecloths, and address guests by their surname.
They know it’s a place where serious deals happen. Between enormous chunks of mascarpone pancakes, hosts explain the way things work around here. Access means paying the gatekeepers…and it’s not cheap.
It explains why the Hay-Adams Hotel has nice neighbors. There’s the American Picture Association next door. The AFL-CIO across the street. The next block over is K Street, where every polished brass building directory has the name of a bank, drug company, or international firm who needs access. The closer the better.
You could almost pave a gold walkway across Lafayette Park to the White House.
It reminds me of visiting the capitals of communist countries. Most of them are ringed cities. The closer to the center, the greater the influence. The same goes in DC, but with a more patriotic flare. Hail to the chief, but make sure you support the status quo candidate…
Gatekeepers, like the pancake-eating host next to me, charge a fortune. Cost of goods is zero. The client pays for everything, including the 4,000-calorie breakfast.
We have ethical standards in this country. You can’t pay the politician, officially. But you can pay the gatekeeper.
And we don’t know for sure what arrangement the gatekeeper has. The mascarpone enthusiast went on for a while about certain notable politicians of the past. He layered up the complements. Charismatic, charming, and wonderful is how he described the ones he wanted the client to know he worked well with.
Being a gatekeeper means knowing who’s willing to get things done. It’s more of, which gate opens easiest. Some of them fly open.
Either way, this is the system, don’t fight it. And it’s unlikely to change.
Shape The Narrative
The Tucker kids had their own version of power breakfast last week at Lafayette…plain croissant with a side of bacon.
While they don’t know how everything works yet, they know what to expect during meals with their dad. They also know he doesn’t own a television.
Dedicating an entire wall to an electronic gadget feels tacky. It’s even worse when you consider the device displays content openly referred to as “programming.”
But people need programming. Thinking is hard. As Edward Bernays discovered, they’re most comfortable exercising the freedom to choose between two curated options…that’s about all they can handle.
The army of consultants occupying DC does that well. They charge accordingly. It’s more than lights, camera, action. It’s the narrative. Once you see how it works, you can’t unsee it.
After three nights in the capital, we took the train to New York. It’s the only viable train route in the country. Everywhere else feels one step above livestock transport. If you take the train to New York, always opt for the faster Acela service.
They assigned the three of us to a 4-top table in business class. At the first stop, we met our fourth.
Our new neighbor immediately noticed my travel companions had no tablets, or electronic devices, and seemed totally focused on quietly playing tic-tac-toe with old fashioned pen and paper. She then commented on the Hay-Adams Hotel logo at the top of the notepad. Right away, I knew she was a pancake eater.
A general rule of thumb during commercial travel is, be careful talking on the phone. You never know who’s listening. And whatever you say is fair game after it leaves your mouth.
“Jill, I just need the talking points we want to focus on before the show”
OK… I’m listening. And who’s Jill… the phone placed screen up on our table shows her last name.
Proximity AI quickly tells me Jill is an expensive public relations consultant with an advanced degree in psychology. Here’s the setup.
“Axelrod is the host, he’s friendly. But we need to present him [Biden] so people focus on his excellent leadership in the pandemic, restoring the nation to sanity after Trump, and make his stepping aside seem smooth.”
Jill dispatched my seatmate to appear on a CNN show that night hosted by David Axelrod, a friendly media figure.
“He [Biden] once talked to a kid in Iowa about baseball for twenty minutes after an event, nobody does that normally, certainly not a president.”
Really? I hear people talk about baseball for much longer than that. Seems like a low bar.
“I just think we need to focus on his time in the Senate, and his record, and his outstanding leadership. He was elected to the Senate at age 30…a true public servant.”
It’s too bad she didn’t ask me for advice on this. As an unregistered voter, and hefty taxpayer, my perspective could help.
First tip would be, travel outside of DC more often. A weekend in Tennessee might broaden your horizons. Talking to normal people is more useful than million-dollar Jill with the psych PhD.
Curating Your Choices
Erudite, over-educated, and better than the rest of us, the army of public relations operatives stands ready and willing to serve the political class. It’s how a campaign runs through upwards of $200 million in a tense month.
I don’t know what PhD Jill charges, but I’m sure it’s way too much. Don’t assume things change with another party in office. It’s merely a different flavor of the same soup. And Americans love eating it.
In fact, people seem enthusiastic about the situation. They might talk about revolt, but then opt for a pizza and more programming instead.
It’s amazing people take the whole thing seriously. We don’t have primaries anymore, at least in the traditional sense. We get to know candidates through headlines and social media blurbs. If we don’t react well, a new candidate shows up. All this happens without much debate.
It’s all possible in the era where the flow of information is centrally controlled. We’re a free and open society. But if you look outside the mainstream, you face name-calling, or worse.
Easy To See
While it’s easy to see in Washington, the financial markets work the same way.
A politburo sets the price of money.
For some reason, we want money so badly we’ll go along with anything to get it. We’ll trample people, gamble, ignore risks, and some people seem willing to go much further. All for more of this thing with a value set by committee.
Worst of all, many people have enough money to live the life they claim to want. But they don’t. Instead, they push it off. Just a little more money, then they can enjoy. Most never do.
Imagine waking up after 100-year trip to space. You were a stock broker when you left in 1924. There are no stock brokers now. You see everyone walking around with a hand-held computer buying fractional shares of profitless companies. They hope the central planning committee lowers interest rates so their stocks get more exciting.
Even the presidential challenger has a publicly-traded, money-losing social media company. You’d be stunned trying to wrap your head around this if you came from a previous era.
What’s worse, money is no longer scarce. When you left in 1924, it was foolish to borrow, dangerous to grow quickly, and wise to live frugally. Today, it’s just the opposite.
And instead of studying the financials of a company, we wait for the politburo to tell us when it plans to lower borrowing costs. Lower rates mean we can all borrow more, and that’s how we grow. The old way is out the window…and it’s not coming back.
Yesterday’s comments by the chairman of the politburo sent oil up, and gold back to $2,450. That’s less than 1% away from its all-time high…and maybe another ~20% from where it would be if people understood our situation for what it is.
The Fed reversal on money policy looks set for September. Every literate investor in the world believes it’ll send stocks flying. It’s worth considering what usually happens when everyone agrees on something…expect the exact opposite.
Meanwhile, try to remember that everything you see on your device is curated programming…designed to fool you into feelings you wouldn’t have if you did a little critical thinking.
Let’s get in the portfolio review.
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