Monster or Mozart?

BALTIMORE – Investors seem to be holding their breath, like a man hiding a cigarette from his wife. It’s just a feeling, and it’s not the first time we’ve had it… but it feels as though it wouldn’t take much to send them all running.

 

Actually, they’re not going anywhere yet… but there is a lot of overconfidence by those who were very worried when prices were a lot better – click to enlarge.

 

Meanwhile… we’re coming to a deep (and to many readers disagreeable) conclusion. Yes, we are closing in on profundity, struggling to hold on to the rim lest we fall into the well.

It has to do with Mr. Trump’s plans and how he really could Make America Great Again – and how nations and individuals should conduct their lives, including their financial lives: not by guessing about the future, but about doing the right thing in the present.

Each day brings new headlines. Trump does this. Trump does that. Good? Bad? Now we have a formula to judge.

“Trump Plans to Undo Dodd-Frank,” said The Wall Street Journal recently. Win-win? Or Win-lose? The answer is simple: Win-win! How do we know? Because Dodd-Frank was not voluntary. You couldn’t say “no.”

 

What a mouse trap would look like if it were designed like Frank-Dodd. It probably wouldn’t catch the mouse, but it might explode and send small shrapnel that used to be your house into orbit…

Cartoon by Marshall Ramsey

 

How about this, also from the WSJ: “The Trump administration is set to impose fresh sanctions on dozens of Iranian entities.” Win-win? Or Win-lose? You know the answer: Iran has no choice – win-lose.

Should You Invade Russia If You Think You Can Win? Should you shoot your neighbor and sleep with his wife if you think you can get away with it? Should you force interest rates down if you think it will stimulate the economy?

We have seen that only win-win deals add to the world’s satisfaction. And we’ve seen that there is only one criterion you need to ask: Did the parties – like bride and groom – enter it of their own free will? They may or may not get what they are looking for, but they’ll certainly get what they deserve.

Of course, any union is as likely to bring forth a monster as a Mozart. But we can’t sterilize every female or hold the future at bay. Tomorrow always comes. And it is always full of surprises – aborted missions, dead bodies, and unexpected losses.

 

Mozart in the thick of things.

Photo credit: AMLF

 

A representative from a dirt-poor region in Greece makes an impassioned speech in the assembly… the hot air gushing from his mouth collides with the cool breeze coming from Mount Olympus… and torrential rains cause flash floods in California.

All we know – only imperfectly – is what kind of deal is going down today. Win-win? Or is it win-lose? Is it consensual? Or is it rape? Is it “do unto others as you would have them do unto you”? Or is it merely “do unto others”?

 

Halftime Show

“Doing unto others” has its delights, as Genghis Khan noted.   You could burn Hillary Clinton at the stake during halftime at the Super Bowl. At least 100 million Americans might gawk in pleasure. Many would believe it was a good thing.

 

Genghis Khan was known to eschew luxury and generally was held to be a man of simple pleasures, as exemplified by this quote: “The greatest happiness is to scatter your enemy, to drive him before you,to see his cities reduced to ashes, to see those who love him shrouded in tears, and to gather into your bosom his wives and daughters.”

Photo via history.com

 

The U.S. government puts the value of a human life at $10 million. The ad revenue alone might make that one of the best investments of all time. But win-lose deals do not add to real wealth. And once you go down that road, you are headed to poverty,  if not to hell.

As we have seen, regulation, legislation… crony deals and zombie payoffs financed with fraudulent money – have hit the heartland hard. “Flyover” America loses; the winners are in the coastal swamps. So, let’s look at a couple more of “The Donald’s” proposals.

He’s proposed a tax cut, for example. On the face of it, that’s a win-win. The feds take less of your money. You have more left over for win-win deals. Wait –  you say he’s also proposing to take away the deductibility of business interest? Darn! Win-lose.

So, let’s move on – to bridges, dams, roadways, and docks. The president says he wants to spend more on infrastructure. Will it pay off? Who knows? Some projects will be useful. Some won’t.

Politicians, contractors, and insiders will surely benefit. Some people who use the facilities will benefit by accident. Everyone else pays for things they don’t want or don’t use.

But we don’t have to guess. We only have to ask: Can we just say “no”? If not, it’s another boondoggle for the swamp critters – and a bamboozle for the rest of us.

 

Can’t win against the swamp critters, at least they seem to think so…

Illustration by Stan Woch

 

Charts by: StockCharts, SentimenTrader

 

Chart and image captions by PT

 

The above article originally appeared at the Diary of a Rogue Economist, written for Bonner & Partners. Bill Bonner founded Agora, Inc in 1978. It has since grown into one of the largest independent newsletter publishing companies in the world. He has also written three New York Times bestselling books, Financial Reckoning Day, Empire of Debt and Mobs, Messiahs and Markets.

 


 

Emigrate While You Can... Learn More

 
 

 
 

Dear Readers!

You may have noticed that our so-called “semiannual” funding drive, which started sometime in the summer if memory serves, has seamlessly segued into the winter. In fact, the year is almost over! We assure you this is not merely evidence of our chutzpa; rather, it is indicative of the fact that ad income still needs to be supplemented in order to support upkeep of the site. Naturally, the traditional benefits that can be spontaneously triggered by donations to this site remain operative regardless of the season - ranging from a boost to general well-being/happiness (inter alia featuring improved sleep & appetite), children including you in their songs, up to the likely allotment of privileges in the afterlife, etc., etc., but the Christmas season is probably an especially propitious time to cross our palms with silver. A special thank you to all readers who have already chipped in, your generosity is greatly appreciated. Regardless of that, we are honored by everybody's readership and hope we have managed to add a little value to your life.

   

Bitcoin address: 1DRkVzUmkGaz9xAP81us86zzxh5VMEhNke

   
 

2 Responses to “Boondoggles for the Swamp Critters”

  • wmbean:

    We shall always have boondoggles, to believe otherwise is to believe in the perfectibility of mankind here on this earth, a prerequisite of progressive liberalism beliefs. The question is whether the Donald will be able to reduce a portion of the waste in government spending. This is one of the Herculean tasks and should he be able to “reform” a portion of government spending then he would be regarded as a god. Remember, there are no win-win or win-lose situations, only the ying and the yang of our primal forces fighting for primacy.

  • Treepower:

    Is Trump really proposing to do way with deductibility of business interest? Can we have a source please and if it’s true, could PT please post on the manifold and serious consequences of such a revolutionary action? Wouldn’t this turn the monetary world on its head?

Your comment:

You must be logged in to post a comment.

Most read in the last 20 days:

  • India: Why its Attempt to Go Digital Will Fail
      India Reverts to its Irrational, Tribal Normal (Part XIII) Over the three years in which Narendra Modi has been in power, his support base has continued to increase. Indian institutions — including the courts and the media — now toe his line. The President, otherwise a ceremonial rubber-stamp post, but the last obstacle keeping Modi from implementing a police state, comes up for re-election by a vote of the legislative houses in July 2017.  No one should be surprised if a Hindu...
  • Moving Closer to the Precipice
      Money Supply and Credit Growth Continue to Falter The decline in the growth rate of the broad US money supply measure TMS-2 that started last November continues, but the momentum of the decline has slowed last month (TMS = “true money supply”).  The data were recently updated to the end of April, as of which the year-on-year growth rate of TMS-2 is clocking in at 6.05%, a slight decrease from the 6.12% growth rate recorded at the end of March. It remains the slowest y/y growth since...
  • How to Stick It to Your Banker, the Federal Reserve, and the Whole Doggone Fiat Money System
      Bernanke Redux Somehow, former Federal Reserve Chairman Ben Bernanke found time from his busy hedge fund advisory duties last week to tell his ex-employer how to do its job.  Namely, he recommended to his former cohorts at the Fed how much they should reduce the Fed’s balance sheet by.  In other words, he told them how to go about cleaning up his mess.   Praise the Lord! The Hero is back to tell us what to do! Why, oh why have you ever left, oh greatest central planner of all...
  • What is the Buffet Indicator Saying About Gold?
      Chugging along in Nosebleed Territory Last Friday, both the S&P 500 and the Nasdaq composite indexes closed at record highs in the US, with the Dow Jones Industrial Average only a whisker away from its peak set in March. What has often been called the “most hated bull market in history” thus far continues  to chug along in defiance of its detractors.   Can current stock market valuations tell us something about the future trend in gold prices? Yes, they actually...
  • The 21st Century Has Been a Big, Fat Flop
      Seeming Contradiction CACHI, ARGENTINA – Here at the Diary we have fun ridiculing the pretensions, absurdities, and hypocrisies of the ruling classes. But there is a serious side to it, too. Mockery makes us laugh. And laughing helps us wiggle free from the kudzu of fake news.   Is it real? Is it real? Is it real? Above you can see what the problem with reality is, or potentially is, in a 6-phase research undertaking that has landed its protagonist in a very disagreeable...
  • A Cloud Hangs Over the Oil Sector
      Endangered Recovery As we noted in a recent corporate debt update on occasion of the troubles Neiman-Marcus finds itself in (see “Cracks in Ponzi Finance Land”), problems are set to emerge among high-yield borrowers in the US retail sector this year. This happens just as similar problems among low-rated borrowers in the oil sector were mitigated by the rally in oil prices since early 2016. The recovery in the oil sector seems increasingly endangered though.   Too many oil...
  • Will Gold or Silver Pay the Higher Interest Rate?
      The Wrong Approach This question is no longer moot. As the world moves inexorably towards the use of metallic money, interest on gold and silver will return with it. This raises an important question. Which interest rate will be higher?   It’s instructive to explore a wrong, but popular, view. I call it the purchasing power paradigm. In this view, the value of money — its purchasing power —is 1/P (where P is the price level). Inflation is the rate of decline of...
  • Warnings from Mount Vesuvius
      When Mount Vesuvius Blew   “Injustice, swift, erect, and unconfin’d, Sweeps the wide earth, and tramples o’er mankind” – Homer, The Iliad   Everything was just the way it was supposed to be in Pompeii on August 24, 79 A.D.  The gods had bestowed wealth and abundance upon the inhabitants of this Roman trading town.  Things were near perfect.   Frescoes in the so-called “Villa of the Mysteries” in Pompeii, presumed to depict scenes from a...
  • Rising Oil Prices Don't Cause Inflation
      Correlation vs. Causation A very good visual correlation between the yearly percentage change in the consumer price index (CPI) and the yearly percentage change in the price of oil seems to provide support to the popular thinking that future changes in price inflation in the US are likely to be set by the yearly growth rate in the price of oil (see first chart below).   Gushing forth... a Union Oil Co. oil well sometime early in the 20th century   But is it valid to...
  • A Bumper Under that Silver Elevator – Precious Metals Supply and Demand
      The Problem with Mining If you can believe the screaming headline, one of the gurus behind one of the gold newsletters is going all-in to gold, buying a million dollars of mining shares. If (1) gold is set to explode to the upside, and (2) mining shares are geared to the gold price, then he stands to get seriously rich(er).   As this book attests to, some people have a very cynical view of mining...  We would say there is a time for everything. For instance, when gold went ...
  • Silver Elevator Keeps Going Down – Precious Metals Supply and Demand
      Frexit Threat Macronized The dollar moved strongly, and is now over 25mg gold and 1.9g silver. This was a holiday-shortened week, due to the Early May bank holiday in the UK. The lateral entrant wakes up, preparing to march on, avenge the disinherited and let loose with fresh rounds of heavy philosophizing... we can't wait! [PT]   The big news as we write this, Macron beat Le Pen in the French election. We suppose this means markets can continue to do what they wanted...
  • The Knives Come Out for Trump
      A Minor Derailment GUALFIN, ARGENTINA – Yesterday, stocks fell. And volatility shot up.   When too many people have too many knives out at once, accidental cubism may result   Reports Bloomberg:   The Dow Jones Industrial Average tumbled more than 370 points, Treasuries rallied the most since July and volatility spiked higher as the turmoil surrounding the Trump administration roiled financial markets around the globe. Major U.S. stock indexes...

Support Acting Man

Austrian Theory and Investment

Own physical gold and silver outside a bank

Archive

j9TJzzN

350x200

Realtime Charts

 

Gold in USD:

[Most Recent Quotes from www.kitco.com]

 


 

Gold in EUR:

[Most Recent Quotes from www.kitco.com]

 


 

Silver in USD:

[Most Recent Quotes from www.kitco.com]

 


 

Platinum in USD:

[Most Recent Quotes from www.kitco.com]

 


 

USD - Index:

[Most Recent USD from www.kitco.com]

 

THE GOLD CARTEL: Government Intervention on Gold, the Mega Bubble in Paper and What This Means for Your Future

 
Buy Silver Now!
 
Buy Gold Now!
 

Oilprice.com