It was 40 years ago today
On this date forty years ago, December 21, 1970, in a bizarre meeting of pop culture icons, Elvis Presley met with President Richard Nixon after ‘The King’ appeared unannounced at the gates of the Executive Mansion and handed the guard on duty a 5-page handwritten letter requesting a meeting with the president.
Elvis presented the president with a commemorative Colt .45 pistol during the meeting for some reason, and according to notes of the meeting taken by Nixon aide Egil Krogh, Presley told the president that he thought the Beatles were a “real force for anti-American spirit” (not to mention having put a serious dent in the King’s record sales. He was probably resentful of their role in his banishment to Vegas).
Elvis also disclosed that he had been studying “Communist brainwashing and the drug culture for over ten years.” At least the second claim was not hyperbole!? After the meeting, Elvis got what he was after: a 
Elvis was such an important cultural figure in American history that two versions of him co-exist in the pantheon of Pop Culture Gods. The one we all prefer to remember is the cool, leather-clad rockabilly version that dramatically burst upon the world stage in the 1950s, but the overweight, caped Vegas version still has a hold on the popular imagination. Together they symbolize a peculiarly American version of a Shakespearian tragedy.
While it will be sometime before we know if the upcoming year is filled with scintillating versions of “Hound Dog” or turgid versions of “In The Ghetto,” we can at least run with the metaphor for the rest of this blog entry.
After a decade in which a debt-fueled spree caused the American economy to become as bloated as the late-period Vegas Elvis after a night spent bingeing on amphetamines and fried peanut butter and banana sandwiches, it should have come to little surprise to any of us that the post-housing bubble crash was so painful to endure. But now American corporations have become as lean as the leather-clad Elvis seen during his famous televised “comeback” special in 1968 and investors can’t help falling in love with the thought that the so-called “new normal” may not be quite as depressing as some of the popularizers of that phrase have been predicting.
Reluctant buyers appear to have decided that it’s now or never and have been jumping into the market in the anticipation that improving economic conditions will result in an earnings bonanza for said corporations.
Many suspicious minds, scarred by the experiences of the past two years are having a hard time buying into the notion of a “melt-up” in the market, but the indexes are currently pressing up against a number of resistance levels and an upside breakout could cause the shorts to check into Heartbreak Hotel. The recovery of the service sector, currently said to make up nearly two-thirds of the American economy, will be the key to improved GDP growth and investors would be wise to key an eye on related metrics.
Services (think Elvis’coterie of assorted “hangers-on”) tend to recover later in the cycle than durable goods and if the pattern plays out as it has in past recoveries, we could be on a verge of another leg up. Anecdotal evidence supports the thesis that he wealth effect caused by a rising market is encouraging consumers to spend during this holiday season. Can it be long before businesses large and small begin to reap the benefits of increased consumer spending? Judging by the increasing number of prognosticators who are predicting a strong rally, we all could be headed for Graceland in 2011.
Thank you very much.
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