DUBLIN – Myths, myths, myths…
Bamboozles… claptrap… bummmph… clownish gods… jackass deities!
We are surrounded… outnumbered… hopelessly outgunned.
In short, the situation is excellent. We will attack!
Hesitating… we glance around. Our beat here is money; we don’t want to take our eye off the ball.
As our head of research, Joe Withrow, reported yesterday, the price of oil recently hit $70 per barrel for the first time in four years.
JPMorgan CEO Jamie Dimon says we should prepare for 4% yields on U.S. Treasuries.
Can the stock market survive 4% yields? Can the economy survive $70-per-barrel oil?
We don’t know… but we’ll find out.
In the meantime, let’s return to our attack on myths and mumbo-jumbo. And today, let’s talk about you, Dear Reader. What myth do you live by? How has it shaped your life?
We ran into a familiar public myth leaving Dulles International Airport on Sunday. Elizabeth was selected for a deep search. That is, she was taken aside.
A short woman in an oversized uniform put on a pair of blue gloves and proceeded to run them all over Elizabeth’s body… Every contour was followed; every hill and valley was explored.
We couldn’t decide; should we be jealous, outraged… or merely appalled?
Millions of hours… and trillions of dollars… have been spent on “homeland security.” But is anyone in the homeland safer?
We don’t know, but we do know that the scene we witnessed on Sunday was much more magic ritual than practical precaution. No one really thought Elizabeth posed a danger to air traffic safety – not the woman doing the search, not the fellow passengers, not her husband… no one.
And, in fact, she had no intention of bringing down the Aer Lingus plane. But the TSA agent gave her the attentions of a demented masseuse.
“What is wrong with that woman?” we asked ourselves, watching. “Her job is not worth doing, and certainly not worth doing well.”
The myth of a terrorist threat took hold in 2003. Like all myths, there is some truth to it. But not much.
And the measures taken to meet the threat have done more harm than good. If there was only a handful of “terrorists” then, there are surely more now.
But here, too, we see the perversity of myths. They are born in the imagination, but they shape the real world.
We imagine hobgoblins, bugaboos, and ghosts… and pretty soon, they’re eating our lunch and hiding our cell phone.
Global climate change, inequality, drugs, insurgents – every “problem” invites a solution… and a man-made disaster.
Remember, the feds run what is essentially a protection racket. You pay. They protect. If you don’t pay, they burn your house down.
“See,” they say, “we told you it was dangerous out there.”
The more dangerous you think it is, the more readily you turn to your protectors and give up your money and your dignity.
And myths can be hard to shuck. How many millions of people have gone through the TSA lines and watched the same sorry and pathetic spectacle… all worshipping ersatz gods at an absurd altar?
And who resists?
Challenge a popular myth and you risk being torn apart by patriots!
Myths are supple… stretchy… and accommodating. They cover sins. They disguise fraud. They harbor bamboozlers and flimflam men.
The counterfeiter says he is stimulating the economy. The war profiteer in Afghanistan says he is protecting the lives of schoolchildren in South Dakota. The professor at the University of Michigan gets paid to help “liberate society from hetero-normalized patriarchal oppression.”
In The Irish Times newspaper today is a headline: “Plan to reveal gender pay differences.”
The feds are on the case!
Men and women should be paid the same thing, they say. Again, there is some truth to it. It seems unfair to pay one group more than another.
And yet, tall men typically earn more than short men. Why? Should there be a public policy – equal pay for runts? White men typically earn more than Black men. Should there be a public policy – equal pay for Blacks? Jews earn more than Christians. Should there be a public policy – equal pay for goyim?
Large-scale myths – which become the basis for public policies – are usually win-lose scams. They favor some people… at the expense of everyone else.
The “War on Terror,” for example, is great for the security industry. It created it. And now, it can be counted on to fight it… with the last drop of your money.
And the as-yet-unannounced “War on Inequality” is bound to be a winner, too – for someone.
Private myths are different. We write the stories of our lives; we create dragons… and then slay them.
We are “the able and loyal worker,” for example, triumphing over want, idleness, and irrelevance.
We are the good husband, walking the line… providing for our family… resisting temptation.
We’re the good citizen. We read the papers. We vote. We join. We participate.
Or we’re a rich guy. We have a big house… a big boat… and a big stock market portfolio.
We are enlightened… and progressive.
Or we are a good conservative… maybe even a conservative Christian.
These descriptions may be “true”… until they are upended by events.
The good employee gets fired. The good husband is a good husband… until he meets a fetching cocktail waitress. The rich guy gets wiped out in a market crash… and has to fly in economy. And the Christian conservative votes for Donald J. Trump!
Yes, Dear Reader… we are all human. Not always good, and not always bad… but always subject to influence. We need myths to make sense of them.
Once our heroic story is undone, we must tell a new story.
The good employee becomes the victim of a rapacious employer. The good husband buys a convertible and becomes a bon vivant. The rich guy becomes a Marxist. And the conservative thinks it is time for a change.
When things go wrong, you blame someone else – or simply deny the obvious contradictions.
Did we run off with the cocktail waitress? Or did our old wife lose interest and drive us away?
Did we really fail to do our job properly, as charged? Or was our employer trying to reduce his payroll by getting rid of his most senior and most competent workers?
Should we have known that it was a bubble? Or are bubbles as unpredictable as Alan Greenspan says?
As for The Donald, there is nothing Christian or conservative about him.
But who knows? God works in mysterious ways!
By Joe Withrow, Head of Research, Bonner & Partners
Tech stocks are leading the pack so far in 2018…
That’s the story of today’s chart, which tracks year-to-date gains for six prominent market sectors.
As you can see, the technology sector boasts 6.1% gains so far this year to lead the way.
That compares to 5.7% year-to-date gains for consumer discretionary stocks… and 2.9% gains for energy stocks.
On the downside, financial stocks have lost 1.9% this year… the industrials have lost 4.1%… and consumer staples have plunged 12.2% so far in 2018.
– Joe Withrow
Trump Could Send Oil Skyrocketing
As Bill reported above, oil recently hit $70 a barrel – a four-year high. And the price of crude could soon lurch higher if President Trump does this one thing.
Yes… Your Employer Stalks Your Facebook
Dan Denning wrote recently of the hidden dangers of social media. Now, more evidence that social media may have more downsides than you think. Here are the social media accounts that your employer is likely looking at.
Buy Your Home on the Blockchain
If you’ve ever purchased a home, then you know. Closing costs, typically, are in the thousands of dollars. And it can take months to settle all the paperwork. But according to Jeff Brown, Bill’s top technology expert, this process could soon be completed in minutes… and cost pennies on the dollar. Here’s how.
In the mailbag, Bill’s Diary “How to Spot Convenient Claptrap,” has gotten readers thinking…
This is truly one of your best efforts. To be able to convey such a serious message, humor, and direct metaphorical connections made it most enjoyable. Thank you, Bill, for all of your great insights in the Diary and your journalistic excellence. Most enjoyable. I never miss a single one.
– Dennis D.
Government is certainly backed by violence. Please, could you shine more light on this? To me, it’s clear that it needs the police and military for this. Without the police/military being mindless, unethical servants to their paymasters through forced taxation, the “government/elites” would be pathetic non-entities, right?
And the world would be a much more civilized place. We’re paying for our enslavement! Our own government is always our biggest enemy, by way of the police. It is so obvious, but to so painfully few.
– Roy M.
Deficits don’t matter. Proof: Greece. Here’s another old myth that has proven true: If you owe a few hundred thousand, lenders will hound you. But if you owe millions, they will help you in the hopes of recovering their money. Holders of U.S. debt are in greater jeopardy than the borrowers. In a trade deficit, sellers have more to lose than buyers.
– Erich K.
I’ve been a fan of yours and reading your material for about six years. Clearly, the long flight and time to think was just what you needed. What an excellent article and perspective! You reported on several fine nuggets, especially the four points: time, scale, violence, and win-win. The best point you made is how people understand that “deficits don’t matter” does not work on an individual basis; but for some reason, the American population seems perfectly fine with the government spending $21 trillion more dollars than it currently has.
I expected this 10-year recovery to turn sour at least a couple of years ago, and yet it keeps trotting forward. I assume that instead of slowing into a more typical business cycle recession, it will barrel forward until it goes straight off the cliff, only to hit the bottom below with a mighty crash. Time will tell. Yet I believe all your conservative wisdom will prove to be the victor over the abundance of claptrap we listen to daily. Cheers, Bill. Looking forward to your next writings and ramblings.
– Ken L.
Meanwhile, one reader raises a glass to Bill…
Today I got another proof that everything in life happens for a reason. Right when I was waiting for delivery of your Malbec, I was cleaning my mail and found one not read from a year ago – it was your “head toward civilization then take a left” story.
I love your Argentine topics much more than cynical and boring obituaries of our politics and finances. They are very poetic, even when you describe the harsh reality of everyday life there. And this one vividly (and with the smell) reminded me about a night in the Kazakh Steppe more than 60 years ago, sitting under open sky near an open fire waiting to taste a little lamb just killed in my honor. I will taste your wine tonight in your honor. Wishing you good health in the good Russian tradition – za zdorovie!
– Michael B.
Editor’s Note: If you haven’t heard the news, Bill’s little vineyard in Argentina has just produced another batch of Tacana Malbec. Bill produces this wine once a year in limited quantity. But if you want to try some, you’d better hurry. Supply is almost out. Get all the details right here.
Volatility is back, and it’s not going away…
But master trader Jeff Clark isn’t worried. He’s actually excited.
That’s because fortunes can now be made in days, not decades. Here’s how you can do it, too.