BALTIMORE – We’re trying to avoid distractions. What is really going on, we wonder? What is really important, we ask?

Donald J. Trump came to Washington, D.C., promising to “drain the swamp.”

Instead, the swamp is draining him.

The media entangles him in fake news kudzu. Establishment bugs nip away at him like mosquitoes at a bayou picnic. Special interests and Deep State operatives slither around him threateningly… while Deep State heavies try to drown him in accusations.

Business as Usual

We thought “The Donald” would quickly make peace with the swamp.

He has no fixed convictions… no ideology or principles to get in the way.

We figured he’d go along with the insiders… and become the biggest swamp critter of all.

And when he stuffed his cabinet with generals and Goldman guys, we thought he was on his way.

But the way it looks now, “The Donald” just can’t “fit in.” Many of the Deep State foxes consider him unreliable. Or embarrassing. They want to get rid of him… or weaken him so he is more or less irrelevant.

The Comey testimony didn’t help anyone as near as we could figure. “The Donald’s” fans came away believing their man was set up by a disloyal “leaker.” And the Establishment insiders are determined to keep beating up on him until he falls down.

They might succeed. Or they might not. It hardly matters.

In the meantime, President Trump is taking so many punches, he’s beginning to wobble. Only five months into his administration and he’s looking lame. He couldn’t make any major changes – even if he wanted to.

And Pence?

He’s ready to fall in line with the insiders at any time.

So it’s business as usual. No swamp draining… no serious budget cuts… no tears in the Deep State land… no end to the make-believe wars… no Trump reflation trade… no big infrastructure projects… no “jobs, jobs, jobs”… and no change in course. For now.

The feds control – directly or indirectly – half of GDP. And the insiders control the feds. The last thing either wants is real change.

But that doesn’t mean they can stop it.

Change You Can Believe In

Markets don’t stop just because the insiders want them to stop; markets react to the public spectacle… but they follow deeper currents, too.

Debts don’t shrink just because you can’t pay them. And the future doesn’t wait just because you’re not ready for it. Change happens whether you want it or not.

Sometime soon – most likely before the end of the year (though, recently, no one has lost money by betting against our timing hunches) – the weight of debt, lies, delusions, and claptrap is going to cause the floor to cave in.

When that happens, all of a sudden, people are going to lose interest in the spectacle in Washington.

Gone will be any interest in whether Russia meddled in a U.S. election (which never really mattered anyway). Gone will be any interest in whether Comey lied… or Trump lied… or what The New York Times said… or whether “The Donald” acts “presidential.”

Instead, all eyes will turn to the spectacle in New York. Crashing prices are bound to get their attention.

The Dow will be cut in half. The big banks, considered too big to fail, will be failing. People who have bought ETFs to be “in the market” will want to be “out of the market.” Volatility, so recently like the EKG of a dead man, will begin to rise from the table like Frankenstein.

And then, the call will go up to the president and the chairman of the Fed.

“Do something! Save us! To the rescue!”

And to the rescue they will come.

But how?

With short-term interest rates already near zero… with the Fed already holding more than over $4 trillion of government bonds on its balance sheet… with the budget deficit already set to rise by $10 trillion over the next 10 years…

…what can they do?

That will be the next big story…

…not the Trumped-up battle over Russian election meddling…

…not the nuances of Donald Trump’s “I hope you can see your way clear to letting this go” comment…

…not proposed tax cuts…

…not the withdrawal from the Paris climate accord…

No, none of it will matter very much when real change shows up.

Stay tuned…

Regards,

Signature

Bill

 

Currency Insight: This Currency Booms in Bad Times


BY CHRIS LOWE, EDITOR AT LARGE, Bonner & partners


bill bonner

Bitcoin booms during bad times…

That’s the big takeaway from today’s chart. It looks at the price of bitcoin in U.S. dollar terms going back to 2015.

As you can see, each time there is a spike in geopolitical stress, the price of bitcoin goes higher.

The best way to think of bitcoin is as “virtual gold.”

It’s outside of the control of central banks… it allows you to hold savings outside of the banking system… and it’s not vulnerable to a sovereign debt collapse.

When the big kahuna Bill warns about hits, expect to see the price of bitcoin soar.

Chris Lowe

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Mailbag

In response to Friday’s Diary on the testimony of former FBI Director James Comey, one reader wants Bill to name names…

While I generally believe you have more insight than most into the machinations of the “deep state” and imperial America, you seem unwilling to give meaningful information on how we can expedite the complete destruction of the deep state, which is ultimately the only solution to all of our problems.

Instead, you continue to sit idly by waiting for “the inevitable.” You don’t do any actual value-added labor, which is the ONLY thing that creates wealth. What have YOU manufactured lately (besides electronic confetti)? So excuse me, but I fail to see exactly how you are any better than them. How about you provide some useful info like naming the guilty parties of the deep state?

– John T.

Meanwhile, debate on whether federal regulations do more harm than good

You say that regulations only help industries to stay on top. How about the grocery shopper who is being lied to about the “products” that appear to be food but are actually cumulatively poisonous? How about all the hype about how “sweet” things are, only to find out that sugar causes diabetes and other illnesses?

Is it not valid for people who buy food to have labels that tell them what is in it so they can make an informed choice? So, should we have oil drilling in the Grand Canyon area so the economy will “expand”? Sometimes there are things and relationships more important than money. Sometimes it seems to take regulation to rein in those whose ethical levels are so low that they would knowingly poison the land where food is grown in order to make a profit. Do you have a better solution?

– Cassandra A.

In Case You Missed It…

Our colleague Jeff Clark just released what he’s calling “the biggest breakthrough of my career.”

Thanks to a predictable act of government meddling, there are four “profit windows” that open at certain times of the year. When these windows are open, Jeff’s subscribers have had the chance to make triple-digit gains in as little as 24 hours.

Jeff recently let cameras into his Northern California home to share this strategy. See for yourself right here.