| By Bill Bonner, Chairman, Bonner & Partners Friday, February 14, 2020 – St. Valentine’s Day RANCHO SANTANA, NICARAGUA – We’re down here on the Pacific coast. Lovers in one another’s arms. Birds in the trees. And even the old men like it. Here’s our little cottage: And the view from the porch: Our tropical view out front But even down here in the tropics, our Dear Readers’ comments reach us. Here’s one: “Our economy is the best it has been maybe ever.” Everyone thinks the economy is strong. Regularly, you hear the political prognosticators tell us that Trump will win if it stays that way. Alas, it isn’t so. We’ve been looking at the great disappointments of the 21st century. And the economy is perhaps the biggest one of all. But let’s leave that for last… | Recommended Link | | This isn’t about politics… We’re not here to tell you who to vote for. That’s entirely up to you. But there’s an extremely urgent investment opportunity in the tech market… And it’s going to happen as a result of the 2020 election. That’s why, no matter who your favorite Presidential candidate is… You owe it to yourself and your family to find out about this huge profit potential. | | | -- | 21st-Century Blunders George W. Bush started off the century by promising a “humble” foreign policy. By then, the internet – with all the world’s accumulated knowledge, data, and information at the ready – was available to everyone. But apparently, no one on the Bush team read the classics… and it didn’t take them long to make one of the most arrogant blunders in U.S. history. A reading of Roman history, for example, shows that large, sophisticated, and disciplined armies can beat other large armies and conquer cities and organized communities. But put them in the forest, the jungle, or the mountains, up against dispersed, mobile fighters – such as the Afghan tribes – and they are useless. They can win every battle and still lose the war. The only “solution,” the Romans discovered, was extermination. That is what Emperor Domitian did in his campaign against the Nasamones of North Africa. He reported to the Senate that he had not subdued the tribesmen, but that they had “ceased to exist.” By 2003, the U.S. was engaged in what would become its longest and most expensive war ever… against a phantom enemy that no one could even define, let alone vanquish. What was a “terrorist,” after all? The cost of Bush’s wars is now said to be around $7 trillion, or a third of annual U.S. GDP. And as the first decade of the 21st century came to a close, it was already obvious that the Information Revolution, too, was a failure. People had far more information than ever before… but there was no way to tell what was real and what was fake… what was gold and what was dross. And where were those weapons of mass destruction? They could get a lot of practical tips from the internet. They could get directions to the nearest liquor store from GPS-enhanced interactive maps. But the internet could also send them in the wrong direction. Every crank with a conspiracy theory… every yahoo with an investment secret… every jackass with a plan to improve the world – all had millions of potential disciples. | Recommended Link | | America’s #1 Investor Makes Stunning Discovery at Trump Tower… Since 2016, Teeka Tiwari has trumped the stock market. His investment recommendations have averaged 154% per year. That’s 10 times the S&P. And 81 times the average investor, according to JP Morgan! However, one investment Teeka just uncovered could top them all… It involves President Trump, billions of dollars, several large banks, as well as Warren Buffett. As well as a MAJOR upgrade to our credit and debit cards. Teeka, who correctly picked the last two “investments of the decade,” is declaring this his top pick for the 2020s. | | | -- | Where’s the Progress? It was said that deliverance was near. The “singularity” would propel us into a new era of extra-smart machines. AI (artificial intelligence)-enabled computers would have some way of knowing what was true and what was false. No more buying houses at the top of a mortgage finance bubble! Now, we’d be able to avoid mistakes and make more progress than we could even imagine. But there is still no sign of it. Day by day, there are more annoying apps and time-sinking gizmos. Computers grow faster and better, but what are they actually doing? They shuffle more and more information… and yield even more information! Then, in 2009, along came Bitcoin. Not only did the new money promise to disrupt the whole world’s money systems… It also offered a key to verifying information – the blockchain. Though few people actually understood what a blockchain was, everyone had an idea about how to use it to make money. And what happened? Our son Henry reports: In particular, “intelligent contracts,” [based on blockchain technology] that were supposed to replace computer programs, and provide a new way to [protect the integrity of information systems] did not bear much fruit. Despite ambitious projects and tens of millions of dollars devoted to various blockchain applications, the only place it worked was the one in which it began. The blockchain technology still only serves one purpose, to keep track of cryptocurrency transactions. All other applications seem to have been more or less abandoned, including the initiatives made by Facebook on its “Libra” project. The blockchain can do some things, but its range is more limited than many had thought. Another disappointment, in other words. Then came the “unicorns” – companies with new ways to use the new technology. Though their business models were unproven, they still were bid up to a billion dollars, and more. They believed that the route to success was not focusing on profitability (there wasn’t much of that), but what they called “blitzscaling” – spending as much money as fast as possible in order to dominate a new industry so completely it would scare off or cripple later competitors. It was like dumping Miracle-Gro on the roots of a tree, so that it would grow quickly and shade out rivals. | Recommended Link | | Gold Beat Stocks (But This Could Do 50X Better) Gold had an amazing year. But don't be too quick to buy gold bullion. Because, according to one millionaire economist, this small sector of the gold market often soars 10X, 20X, or even 50X higher… Now, on camera, one millionaire economist reveals exactly how to play it. | | | -- | Wall Street Casino One of the leading lights of this unicorn trend was the Japanese conglomerate Softbank. It saw that Wall Street had become a casino. Place the right bet and you got rich, like the early investors in Apple, Amazon, or Google. This insight, such as it was, led Softbank to make big bets… and a lot of them. It invested in Alibaba (the big Chinese e-commerce business), in robotics company Boston Dynamics, and many other up-and-comers. They were “geniuses,” said the financial press, betting on other “geniuses” – such as WeWork’s founder, Adam Neumann. The trouble, as we’ve seen in these pages, was that many of these companies were not, in fact, scalable in the way Softbank thought. Often – like the failed shared-office startup, WeWork – they were just old-fashioned businesses pretending to have disruptive new technologies. Suddenly, just last year, the truth began to sink in about WeWork. Softbank reportedly agreed to pay Mr. Neumann as much as $1.7 billion so that he would go away. Another big disappointment. And now investors are beginning to wonder about the whole tech complex… and the geniuses behind it. Henry Bonner again: The gross value of all Softbank’s holdings is around $260 billion. But the stock market valuation of Softbank itself is only $98 billion. The group has a debt on the order of $50 billion. So, the market is discounting the value of its assets by nearly $100 billion because it has a bad opinion of Softbank’s management. A company that fails to make a profit is destroying wealth, not creating it. And today, 45% of the companies listed on the Nasdaq – including some of the biggest names in the tech sector – are loss-making, not profit-making. And the wealth they are destroying is real. It’s the wealth of the shareholders and the economy itself. Tune in on Monday for more disappointments! Regards, Bill Like what you’re reading? Send your thoughts to feedback@bonnerandpartners.com. FEATURED READS Bonds May Not Cushion Losses in Next Bear Market in Stocks
The world is sitting on almost $13 trillion of negative-yielding bonds. And although U.S. Treasury yields have never been negative, that could change in the years ahead. Bloomberg offers alternatives for bond investors looking for safety… The No. 1 Investment for the 2020s?
Investing legend Teeka Tiwari shares a lesson from his 30-year Wall Street career… as well as the investment he’s eyeing for the next decade… MAILBAG Mixed thoughts following Wednesday’s Diary, “Old, Fat, and Not Getting Any Smarter”… How bad does a crash/slump/recession/depression have to be, and when does it have to happen for you to legitimately take credit for an accurate economic prognostication? Clearly another recession is on the horizon, it always is. But I am sure you wouldn’t want to take credit for predicting that. My point is, you keep telling me that the sky is going to fall, but not “when” or “how badly.” You need to give us a sign. We need a way to tell if/when you are right. In the meantime, I try not to miss an issue. – Gene P. Bill writes that “the Financial Times reported that the top 1% now owns 50% of America’s equities. This, too, is a milestone on the road to Hell…” If this is true, then is it possible that the Dow Jones will continue to go up in perpetuity? I used to think that Supplemental Security Income (SSI) had to crash under its own weight. We know that it is a Ponzi scheme, and all Ponzi schemes eventually crash and burn. But SSI is different. It is different in that it is THE political 3rd rail. Senior citizens vote in record numbers. And even libertarian senior citizens want their checks each month. If everyone (or at least the vast majority) that receives these checks votes, then no politician EVER will dismantle SSI, no matter how much cash it is losing. Perhaps, the same holds true for the U.S. stock market. Money = power. If half of the U.S. equities are owned by people with enough money to make sure that everything and anything that can be done IS done to prop up the market, then perhaps “Modern Monetary Theory” actually can/will work. – Joe J. Might Modern Monetary Theory work in limited scenarios, like Joe believes? Are you waiting for Bill to give us a “sign” of just when the next crisis will hit, like Gene is? Write us at feedback@bonnerandpartners.com. IN CASE YOU MISSED IT… Markets HALTED When Mysterious Trader Quit Andy Krieger’s legend is insane… -
He’s on a short list of people who could be Satoshi Nakamoto, THE INVENTOR OF BITCOIN… -
He was in line to take over from George Soros (BUT LEFT MYSTERIOUSLY after locking horns with him)… -
He made a $300 MILLION PROFIT IN ONE TRADE… received death threats… and was forced to hire security… -
When he quit his firm… The Wall Street Journal reported markets HALTED TRADING for 2 hours. Whenever a big trade happens in the world… Many still wonder if Andy is behind it. And on Thursday, February 20th… We’re bringing him in to our studio and streaming him live online… So, he can share a strategy YOU could use to turn every $1,000 in to $30,000 long-term. Click here to find out. 
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