RANCHO SANTANA, NICARAGUA – 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 Chiselers 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 chiselers 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 maneuver.

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…

Regards,

Signature

Bill

 

Market Insight


BY CHRIS LOWE, EDITOR AT LARGE, Bonner & partners


Chris Lowe

Gold is in a bullish uptrend…

Yesterday, I showed you that gold was rallying despite a strong U.S. dollar, which usually keeps a lid on the yellow metal.

Today’s chart tracks the price of gold bullion since Donald Trump’s win over Hillary Clinton on November 8.

As you can see, gold investors experienced a 12% decline in the wake of Trump’s win.

But since gold bottomed last December, it’s rallied 10%.

Chris Lowe

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Mailbag

Yesterday, Bill took the measure of President Trump’s speech to Congress. And it didn’t go down all too well in the mailbag…

After this ridiculous comment about Trump’s speech, with no fact or follow up, this will be the end of my subscription when it’s due. Sad, you are smarter than this drivel.

– Craig S.

I am no longer going to support you or your negative views. You have so much to say about a president that has only been in office less than two months. I am sick of all the negativity and 50 years of horrific politics. If he screws us, how much worse off could we get with Hillary? At least the Trump team’s intentions are honorable and hopeful to this dying nation.

– Kathleen C.

You have many gifts, and you might even be right. But… you are turning into a sourpuss.

– Stan D.

Jesus, I am glad that you are not running the country!

– Robert J.

He’s only been president for a month, so give him a chance. Trump will definitely cut back on the federal government – just watch! He’ll also raise GDP to 3% or higher, which will help.

– Jim P.

But not everyone was put out by Bill’s comments…

Trump didn’t say what you wanted to hear. Why do you act surprised? If he had said the things you – and I – have been saying for years, the people who voted for him would turn against him. No one in Congress would work with him. And the possibility that he’d be assassinated would increase. Other than that, nothing would change.

– Paul A.

I wanted to pass on a comment made by Barney Frank last year when he visited Philadelphia’s Free Library Author Events. He posed a question to the audience to which no one was able to provide the correct answer. So, I pose it to you: "Who has the second largest air force on Earth?"

A few people offered up replies – the kind that might be expected – but nobody was ready for the correct answer. Barney did not keep us in suspense. He advised us that the second largest air force on Earth belongs to the U.S. Navy. [The largest is the U.S. Air Force.]

This fact has bothered me ever since… never more than when I hear President Trump talk about the need for increasing military spending to reinforce our “depleted defenses.” It seems to me that people need concrete, simple verbal snapshots like this to get their attention.

– Steve R.