GUALFIN, ARGENTINA – What a marvelous show!
We don’t know what’s funnier: watching “The Donald”… or watching the media try to make sense of him.
On this occasion, the media is right. Challenging Secretary of State Rex Tillerson to an IQ contest is likely to be embarrassing for both of them.
We doubt Mr. Trump is a genius. We doubt he is a moron, either.
Or an idiot. Or an imbecile.
But as Uncle Remus says, “Dere’s dem dat’s smart… and dere’s dem dat’s good.”
Perhaps Mr. Trump is both. More likely, he is neither.
Most public figures are, at least in part, scoundrels. It would be an amazing thing – especially in America – if Mr. Trump were an exception.
But who knows… The man is far more entertaining than any president in history. He’s a one-man circus: impresario, freak, and clown all in one.
He’s part of what makes it such a pleasure to be an American. The show never ends…
…trash tweeting his fellow Republicans (most recently, Senator Bob Corker)… contradicting and humiliating his cabinet appointees… threatening to punish the NFL if its athletes don’t assume the posture he feels is most correct…
Earnest commentators in the mainstream media regard every move the president makes as a “mistake”… or as “shooting himself in the foot”… or as “undermining his agenda.”
They completely miss the point: The president has no interest in serious legislation. And no real agenda.
He has only one measure of success – ratings.
And at that, he’s the best. He’s a showbiz guy, after all, the P.T. Barnum of the reality TV era.
As we suspected, the president is moving toward putting his brand on a new political party. The Wall Street Journal is on the case:
Mr. Trump would like to lead, and Mr. Bannon would like to create, a Republican Party different from the one that exists. It would be a party molded in the Trump image: nationalist, skeptical of immigration and trade agreements, dubious about the virtues of diplomacy and international negotiations, with economic strategies skewed to help workers in traditional American industries.
The moves revealed thus far won’t help the traditional industries… or any industries other than those favored by the Deep State.
That is what you’d expect. The fool can be wise, but he can’t threaten the ruling class. The village idiot can be elected mayor, but don’t expect people to stop laughing at him.
Mr. Trump’s brand depends on appearing to do battle with the powers that be. But his career (and perhaps his survival) depends on not actually challenging them.
What we end up with is more of the same. More slapstick. More zombies. More cronies. More debt. More funny money. And more laughs.
And we will keep getting more… until it becomes too much. But when that will happen is anyone’s guess.
So, let us change our focus to what is happening in the here and now.
Our visit to the ranch here in Argentina began with an update from our agent, a local lawyer who administers the property when we’re not there.
“Oh, Bill… last month was a disaster.
“The originarios [locals claiming native rights to our land] won the local election. Fortunately, it was just the primary. They won’t win in the general election.
“And the national government extended for more years a law that allows self-proclaimed originarios to stay on your land without paying rent.
“I don’t know where this is going… but it will be a long time before it gets there. Your grandchildren will probably still be fighting this battle.
“And then, at the new ranch, we had a little disaster. But it turned out well in the end. The gauchos were burning off a little bit of underbrush and the fire got away from them. You know how the wind can come up here suddenly.
“Well, no one was hurt… and no houses got burnt. And it ended up burning off 150 acres. We were going to clear that land anyway. And this was a lot cheaper than clearing the land with a bulldozer.”
But we have a sad report, too…
Up in the mountains, there is a young man, Juan, and his wife, whom we see from time to time. He seems like a good guy. We hired him to watch the sheep in the high valley.
But last month, the government sent a nurse up to the valley. She checks in with the local people to see how they’re doing. When she went to visit Juan’s house, she found that Juan’s wife had just had a baby.
But the baby was dead.
Then she noticed a bruise on the baby’s head. Apparently, the mother could give no satisfactory explanation. So, the nurse called the police. They came, arrested the couple, and put them in jail.
“I got them out of jail,” our lawyer reported yesterday. “But they’ve got some questions to answer. We don’t know what really happened.”
More to come…
Editor’s Note: Bill continues to send photos from his ranch in Gualfin, Argentina. Today, he shares a photo of the new property on his recently-purchased ranch in the valley.
Bill’s new ranch house will need some renovations
BY CHRIS LOWE, EDITOR AT LARGE, Bonner & partners
Today, we take another a look at the CAPE ratio for the S&P 500.
This popular valuation metric compares stock prices with an average of the past 10 years of earnings.
Right now, the S&P 500 trades at a CAPE ratio of 31.1 versus a long-term average of 16.8.
This means the index would have to fall 46% to “mean revert” – or come back in line with its long-term average.
But valuations have tended to stay either above or below their long-term average for years… even decades.
As you can see from the table above, the S&P 500 traded below its average CAPE ratio for 243 months between January 1907 and March 1927.
And it traded above its average CAPE ratio for 239 months between December 1988 and October 2008.
Today, the S&P 500 has been trading above its average CAPE ratio for 101 months.
If history is judge, it could stay that way for another decade… or more.
– Chris Lowe
Are These Tech Giants Too Giant?
Over the past four years, the combined market capitalization of Amazon, Apple, Facebook, and Google has grown by the size of Russia’s entire GDP ($1.4 trillion). And that has one author wondering if these tech giants are too giant…
An Unlikely Nobel Prize Winner…
The Nobel Prize in Economics was recently awarded. And the recipient is raising a few eyebrows. He’s a man who believes that modern economics starts with a flawed premise: Humans are rational.
Doug Casey: Legalize All Drugs Today
The government spends billions annually fighting the “War on Drugs.” Despite this, rates of drug use in America hover near all-time highs. Bill’s longtime friend and legendary speculator Doug Casey explains his unorthodox solution for solving America’s drug crisis…
In today’s mailbag, readers discuss “real money.”
Why is gold “real money”? Any more so than copper or iron ore or anything else dug from the earth?
– Robert J.
Maybe “real wealth” is changing, expanding, to cover more possibilities. To-date, bitcoin has been declared dead 172 times. Today, its value shows around $4,900 per bitcoin. So bitcoin, too, has been shown to survive crashes and depressions. While there is electricity and the web — or a version of it — perhaps some cryptocurrencies can also prove to become real wealth, too, in ways that are more reliable and consistent. Perhaps time will tell.
– Brian A.
Think of the true limit on debt not as something imposed by Congress, but as a steel-reinforced concrete wall about 5 meters thick. To find out where the true limit is, we have to crash the caravan of state into that wall at about 200 km/hr. It’s the scientific thing to do!
– Randall M.
Meanwhile, another reader has a suggestion for President Trump…
Trump should appoint Bill Bonner as head of the Fed!
– Richard S.
We are headed for a second “pot stock mania.”
That’s the message from our friends at Casey Research. On October 31st, Canada will vote to legalize marijuana for the entire country. When that happens, this 58-cent pot stock could soar. Details here.