| By Bill Bonner Thursday, September 10, 2020 – Week 26 of the Quarantine In this bright future, you can’t forget your past. – Bob Marley SAN MARTIN, ARGENTINA – What a colossal flop! We’re talking about the 21st century. A failure in almost every way. We now have 30 million people on unemployment – nearly 20% of the labor force. We have a budget deficit of nearly 20% of GDP. And, despite already spending $2 for every $1 they collect in taxes, the feds are planning to spend more. We have phony “conservatives” waving the flag… and real radicals trying to tear it down. On both sides are more and more loonies, locked and loaded… Even many of our own dear readers are ready to go to war with each other. This is from yesterday’s mailbag: Hey Dude, we are at WAR! Trump leads the Win-the-War Party! The Neo Repubs are the “What? Me, worry?” Party. And you are like the pet dog nipping at the heels of the soldiers marching past! No matter the cost, we must win the war against socialism and the Ds. There is time enough to purify ourselves after we win! If we lose, it will be a “thousand years” before our experiment is tried again… Meanwhile it is your obligation to support those who are fighting, regardless of technique and strategy… TRUMP! Nasty Themes It is hard to figure out how an administration that declares a moratorium on rent collection, stifles free trade, and runs a deficit of 20% of GDP could save us from socialism… But in this great 21st-century future, wonders never cease. This week, in this “new normal,” we’ve been trying to remember what the “old normal” was like. And was it really better? Or is it just us? We recalled what it must have been like when we were born. Of course, it was a very different world back then. But don’t the same principles… the same gravity… and the same Constitution still apply? Grace, charm, wit, and civility… or boorishness, blockheadedness, and cruelty – aren’t the choices still the same? By our reckoning, life in America seemed more or less civilized until the end of the 20th century. Then, several nasty themes took center stage: The hubris of people who thought they were “exceptional,” beyond good and evil… and not subject to the same rules as others… …the degeneration of an empire – spending too much… throwing its weight around… depending too much on its military… …the disappearance of true “conservatives”… …the inevitable failure of a fake (paper) money system; none ever survived a full credit cycle… …the disappointment of technology. Back in the 1960s, we imagined the 21st century as a marvel of freedom, flying cars, and Jetson-like machines. Instead, we are cowed by a virus… and held prisoners by iPhones and Zoom calls… with falling GDP growth rates to boot… …and the corruption of democracy into demagoguery, with its bread and circuses… its mobs and messiahs… its clowns and carnival barkers… The 21st century? What a bummer! A Revolutionary New Force Set to Create 818,236 New Millionaires Over the Next Three Years… Good Old Days But let’s try to remember what it was like in the late 1990s, before the new century began. The economy was strong… so strong that the government’s tax receipts more than kept up with the Clinton team’s boondoggles. The national debt was actually going down. This was partly because the Tea Party Republicans were still conservative… and able to block spending. The U.S. had troops all over the world. But there was only one important and shameful engagement that we recall – in Kosovo. There were impeachment proceedings against Mr. Clinton and bitter partisan battles in Washington. But we don’t remember the public with knives at each other’s throats. Downhill Then came the year 2000… and everything seemed to head down. First, the dot-com bubble blew up… and the Nasdaq collapsed. There was nothing particularly unusual or sinister about it. That’s the way markets work. They correct mistakes. But the future was casting a long shadow… the new technology would disappoint us… and the feds would make a bad situation worse. The Federal Reserve had already gotten into the bad habit of backstopping Wall Street. It cut its key rate from 6.5% down to 1%. This led to the next bubble in mortgage finance/real estate… which blew up eight years later. Meanwhile, the Bush administration made one of the biggest blunders in U.S. history. Outraged over 9/11, it declared war against a military tactic – terror. (Why not? The feds were already “at war” with poverty, drugs, and cancer.) And then, it attacked a country that had nothing to do with 9/11 – Iraq. The bills from that disaster are still coming in. Brown University released the latest figures last week. Business Insider reports: At least 37 million people have been displaced by America’s “global war on terror,” according to a new report from Brown University’s Cost of War project. The number of displaced people could be as high as 59 million, the report states. Displacement has caused “incalculable harm to individuals, families, towns, cities, regions, and entire countries physically, socially, emotionally, and economically,” the report states. The federal government’s price tag for the war on terror is over $6.4 trillion, and it killed over 800,000 people in direct war violence. Looking for the next tech cash cow? This is it. Growing Divide Then, in the financial crisis of 2008/2009, the feds went into panic mode again. This time, they mounted the most expensive Wall Street rescue ever – with $3.6 trillion created by the Federal Reserve and pumped into asset prices. Stock prices rebounded, and soon went back into bubble territory. But the economy limped along through the weakest recovery ever. This produced a huge gap between the financialized Wall Street fantasy and the real economy of Main Street. And it caused a growing divide – inequality – between the top 10% of the population, which owns nearly 90% of financial assets, and the bottom 90%, which depends on Main Street employment for its money. The Fed claimed this extraordinary exercise in money-printing and meddling was just temporary… and that it would bring things back to “normal” as soon as the crisis was over. | Recommended Link | Available Now: New Retirement Blueprint from America's Most Trusted Options Trader For the past 36 years, Jeff Clark has helped people retire wealthy… But he hasn't done it the usual way. He uses options. Options probably seem risky. Reckless, even. But his options strategy is different – unlike anything you've probably seen before. It helped him retire at 42. And thousands of others have used it to make $10,000… $100,000… even $1 million or more – in some rare cases. Which is why he's offering his never-before-released blueprint… and a year of his guidance… for just $19. | | | - | Never-Ending Crisis But the crisis never ended. Even before the coronavirus pandemic hit this year, the Fed had the presses running hot in its “Repo Madness” program – in effect, it printed the money needed to fund the Trump administration’s deficits. Which brings us up to this year – to two even bigger mistakes… bigger deficits… more money-printing… more meddling… more debt… …and more disaster ahead. Stay tuned. Regards, Bill
Like what you’re reading? Send your thoughts to feedback@rogueeconomics.com.
FEATURED READS The Stock Market Is Divorced From Economic Reality
Because of fake money, the stock market and the economy no longer operate on the same playing field. In this article from The Washington Post, author Heather Boushey breaks down the disconnect between reality and stocks, and offers a grave warning… U.S. Real Estate Booms As Economy Struggles
Since the United States’ COVID-19 lockdown began in March, Americans’ houses have become home bases for every facet of their lives. In being forced to reevaluate their living situations, they’ve decided to uproot their lives… and buy homes… MAILBAG Dear readers continue reminiscing on their lives following Tuesday’s Diary, “When Summer’s Gone”… Your essays always activate my nostalgia for Baltimore. A simpler time for me, starting my medical career in 1977 as an intern at the Baltimore City Hospitals (as it was called then). I recall you were starting Agora Publishing just down the road from the hospital. I was working about 90 hours a week and earning a salary of about $12,000 a year, but we had steamed crabs, an apartment, scrubs to wear, and a ’72 Beetle. There was not much time to worry about anything except sleep. Ten years earlier, my father supported a family of four on $12,000 a year, earned at a 40-hour-a-week factory job. Difficult to imagine that working now, thanks to the wonders of 49 years of fiat currency printing and Modern Monetary Theory. In any case, thanks to your insightful analysis, I now understand the game that is being played, and though my collection of things to worry about has increased substantially over the years, I am still sleeping fairly well. Best wishes for health and happiness. – Mark H. I just celebrated my 75th year on this planet. Honestly, I don’t know how I survived this long. It seems to have all caught up with me all at once. In 1967, my first year as a New England school teacher, I found an investment vehicle called "warrants." This was the beginning of my education about the power of leverage when investing. The so-called derivatives markets hardly existed. I learned the hard way that investing using leverage is a two-edged sword. Great returns if you’re right. Devastation if you’re wrong. In August 1971, I was living in Atlanta when the daily Atlanta Journal Constitution newspaper suddenly headlined: "Nixon Closes The Gold Window." I didn’t have a clue as to why that was important, but intuitively, I realized it was time I developed a new interest, an interest in gold.
By the spring of 1972, I found myself embarking on a new life chapter in San Francisco, California, where I was introduced to the power and importance of gold from several sources. Within a couple months, I was reading Richard Russell’s Dow Theory Letters (The Primary Trend and "Why Gold"); and also C.V. Myers’ Finance & Energy Newsletter (he was predicting an OPEC oil embargo a year before it happened); and the Bank Credit Analyst, with an amazing long-term chart illustrating something called "Velocity of Demand Deposits - All NY Banks." And then there was Col. Edward C. Harwood, from the American Institute for Economic Research, also singing the praises of gold.
All of the above were guiding me into a profound, and brand new, understanding of why gold is so important. – David M. My grandfather was in the Army and killed in France in WWI. He is buried there. My dad was in the Navy and aboard the USS Santa Fe, a light cruiser. He was a fire control tech. He sighted in the guns on the Japs. He was in every battle in the Pacific in WWII. When I was a kid, we fished a lot in Washington state. I would wonder how he could tie on a hook when his hand shook so much. But I never asked. I would also watch him when he would fall asleep in his favorite chair watching TV and be swimming. His arms moved as if he was “swimming”. Again, I never asked. My brother was 12 years older than I and was on an aircraft carrier in the Korean War. And survived. I was in the Navy and in the engine room of a troop transport, an APA. It was made to haul 1500 troops, but we hauled 2000. We had Marines everywhere. I ran the engine on a papa boat. You know, the one that the ramp drops down, and it was my job to hit the trip to drop it and get the troops off with the bullets flying. And I was to crank up the door and I didn’t waste any time doing so. Everything we had, including C rations, was WWII surplus. I played in the ship’s band. When I discovered that the Viet Nam War was only to keep the drugs coming out of Burma, not to hold back Communism, I was upset. I taught my two sons and five grandsons to stay out of the military and they obeyed. I have three kids, 12 grandkids, and four great-grandkids. – Richard S.
What life experiences did Bill’s Tuesday essay remind you of? Is the United States in for disaster? Write us at feedback@rogueeconomics.com. IN CASE YOU MISSED IT… Why 200 Billionaire Families Believe "Genesis Technology" Will "Fundamentally" Change Everything… The rich rarely reveal their secrets… But in a stunning new report from UBS, 200 of the richest families on earth – worth an average $1.2 BILLION – let slip they believe a new technology will “fundamentally change the way we invest.” “You can feel the electricity,” said one of the families. “It’s almost like what you felt in the 1990s with the Internet.” One of America’s most esteemed (and successful) investors recently met with 4 different billionaires. And he reveals the truth about this revolutionary new technology. As well as what it means for regular investors… See the billionaire’s “top tech” investment here… 
Get Instant Access Click to read these free reports and automatically sign up for daily research. | 
No comments:
Post a Comment