Thursday, March 2, 2017
The Economy: "More Money for the Swamp Critters"
"More Money for the Swamp Critters"
by Bill Bonner
"How do you like that? Another big boost for the stock market. It was all green yesterday; viewers found Mr Trump’s speech reassuring. The Dow rose 303 points. Many will see that as confirmation of their faith in Donald Trump. He must be good for the country, right? And if he’s good for the stock market, he’ll be good for the economy…and jobs…and, you name it.
‘Dimon Says U.S. Future ‘Very Bright’ If Trump Can Enact Reforms,’ says a headline at Bloomberg. Well…it certainly would be bright for the JPMorgan Chase chief executive…and the rest of Wall Street. There would be billions in new defense bezzles coming down the pike…and a trillion in infrastructure bezzles to boot. The policies and proposals we have seen so far will not lead to a real boom. Still, that doesn’t mean they won’t lead to a phony one!
Getting the chisellers off our backs: We have to laugh. The fake money system has faked up everything. And now, the markets seem to be celebrating, anticipating the flow of more fake money. A real boom would require getting these chisellers off our backs. Instead, there will be more money for ‘defense’. More money for Wall Street. More money for ‘infrastructure’. More money for every greasy swamp critter that can slither through Congress.
Hardly anyone has even bothered to ask: Where will all this money come from? With a growth rate of only about 0.5% per capita- we certainly don’t earn it. And with a national debt of $20 trillion already…going up about $1 trillion per year…it’s not as if we had a lot of room to maneuvre. Well…ha ha…who worries about these things anymore? The feds have all the money they want. They just have to print it. Now, at least, we can move on.
Flimflammed by the insiders: We have enough puzzle pieces in place so we can see, vaguely, the big picture: We are going to spend the next few years in a dystrumpian world…with more of what we’ve come to expect- robbed by the fake-money system…flimflammed by the insiders…and frequently mistweeted by our own president. Sad.
Soon, the sordid battle will begin in Congress. The pols are going to take ‘The Donald’s’ proposals (Congress has ceded much of its constitutional responsibility to legislate to the executive branch)…and they’re going to ‘Christmas tree’ them. That is, they’re going to hang all sorts of expensive baubles on them, each plum designed to pay off some campaign contributor, lobbyist, or Deep State insider.
The result- whether it is tax reform, infrastructure boondoggles, or military wampum- will hardly form the basis for a coherent program of any sort, and especially not a coherent program that will reduce the win-lose deals presently sapping the economy. Instead, what’s new will be what was already old…more debt, more claptrap, and more waste of the economy’s real savings. And while these things have the attention of the voters and investors, more important forces will be at work, too…out of the headlines…below the surface, like a huge ball of super-hot magma ready to burst up through the Earth’s crust.
The boom is doomed: A recession is overdue. A crash/bear market is also overdue. The planet sags under $220 trillion in debt. This is not to say that these overdue corrections won’t remain overdue for much, much longer. We lost the gift of prophecy long ago. But the trouble with fake money and a phony boom is that you never know when they will come to an end. As the Austrian economists tell us: Every boom not built on real savings (rather than money borrowed into existence as credit) is doomed to end in a bust.
The present boom on Wall Street is built not even on fake money. It’s built on even softer mud. Investors look at Donald J Trump and see Ronald Reagan reincarnate. He cut taxes, they say. He increased military spending. And he caused a boom that still continues, 37 years later. It took stock prices up 20 times, they say. And now the question for us is this: Are we near the end of that boom…or at the beginning of a new one? What should we do? Join the party betting on a boom…even a phony one? If we’d called all-in on stocks when Donald Trump was elected, we’d be up 10% already. Is now the time to be a crowd follower? Is this a moment when the majority is right and groupthink pays?
More to come…”