BALTIMORE – “All eyes on Brexit vote,” says Reuters.
After a surprise lead for the campaign to take Britain out of the European Union (EU), the Remain camp now has the upper hand.
Based on the average of the last six polls by British newspaper The Telegraph, 51% of British voters want the country to stay in the EU.
But we’re going to look the other way today. We want to see something more important.
As we wrote about on Tuesday, Lord William Rees-Mogg was an advisor to our business, a helpful colleague, and a source of wit and wisdom.
The former Times of London editor and member of the House of Lords used his prestige and experience to expand our range of contacts and advisors.
Twenty years ago this month, something happened to one of them…
There was nothing especially unusual about seeing a canoe wash up on the Wicomico River in Southern Maryland. Still, locals thought it was odd. They knew the currents in the river. They knew that when boats slipped their moorings, they didn’t end up in that cove.
But there it was. And in the canoe, there was something odd, too: sand.
How did that get there, they wondered?
It was almost as if someone had put the canoe there… and anchored it with sand.
We were a little annoyed with Bill Colby at the time…
Lord Rees-Mogg had made the introduction. We were paying the former CIA director for information. We kept waiting. But he said little.
We began to think he didn’t have any information.
But Colby was nothing if not calm and discreet. He lived in a modest house in Washington. He dressed modestly. He was easy to overlook. And he only told you something if he thought you should know it.
As we came to realize, there was a lot he thought we shouldn’t know.
Colby was smart and cool. He had parachuted behind enemy lines in France and Norway with the OSS (a predecessor of the CIA) during World War II. He won the Silver Star, as well as commendations from France, Norway, and Britain.
During the Vietnam War, he went on to become the CIA’s station chief in Saigon. And he directed the controversial Phoenix Program… which oversaw the capture and assassination of thousands of Viet Cong operatives using U.S. and Australian special forces units.
And then, in 1973, President Nixon appointed Colby as director of the CIA, which he ran for two and a half tumultuous years.
They were tumultuous because members of Congress, led by Senator Frank Church, wanted to know what the CIA was up to. Colby told the truth, which is rarely a good idea in Washington.
Colby got fired.
And then he got whacked…
Unlike another CIA Director, David Petraeus, who leaked national secrets to his girlfriend so she could produce a zippy, tell-all book, Colby kept his word and his secrets.
But he was helping us understand something more interesting than secrets. He was helping us to see how the Deep State worked.
Unfortunately, he didn’t get very far. We were only a few months into our collaboration when his body was discovered, face down, not far from where his canoe had washed up.
The locals thought that was strange, too. They had thoroughly checked all up and down the shore… and dragged the bottom… to find the canoe’s owner.
Nothing came up.
Then, nine days later, there he was – as though someone had dumped him there. And where was his life preserver?
It was missing from his house. He never went out without it. Surely, it didn’t sink. And yet, it was nowhere to be found.
“Accident,” ruled the Maryland coroner’s office.
We were supposed to believe that one of the coolest, most calculating and most careful men on the planet had suddenly got up from his dinner – leaving it half-finished – and decided to go out on the river after dark.
He was an old guy, said the coroner’s report, he probably had a stroke or a heart attack.
We didn’t believe it.
But didn’t know what to believe either…
It was obvious that the Deep State’s power was growing. Each day brought more regulations, more rules, and more special favors for cronies in a position to get them.
There is nothing new about this. There are secrets. There are dark crimes. But most of what happens takes place in plain sight of everyone.
The best explanation for this phenomenon was probably given by Vilfredo Pareto, the great Italian engineer and economist at the University of Lausanne, in the early 20th century.
Pareto noted that power and wealth were never evenly or randomly distributed. Instead, a few wily “foxes” always rose to the top, no matter what kind of political system you had. Mathematician Benoit Mandelbrot describes Pareto’s principle:
At the bottom of the wealth curve, he wrote, men and women starve and children die young.
In the broad middle of the curve all is turmoil and motion: people rising and falling, climbing by talent or luck and falling by alcoholism, tuberculosis and other kinds of unfitness.
At the very top sit the elite of the elite, who control wealth and power for a time – until they are unseated through revolution or upheaval by a new aristocratic class.
There is no progress in human history. Democracy is a fraud. Human nature is primitive, emotional, unyielding. The smarter, abler, stronger, and shrewder take the lion’s share.
Foxes, fascists, and Deep Staters use Pareto’s thoughts to justify themselves.
Over time, they take over more and more public policies and institutions, using them to shift money from the people who earn it to the Washington elite, Wall Street insiders, and well-connected parasites all over the planet.
Then, the host weakens and the masses get restless. They notice they’ve been had. They want Brexit to protect them from the refugees. They want walls to protect them from Mexicans. And they want a savior to deliver them from bondage.
“I will end the special interest monopoly in Washington,” promises Donald Trump.
Maybe Bill Colby really did die in an accident. And maybe Mr. Trump really is sincere about wishing to shoo the foxes out of the henhouse.
Our advice: Don’t hold your breath.
Further Reading: Two days ago, Bill sat down with Porter Stansberry (one of the most influential figures in financial research) and Chris Mayer (one of the top stock-pickers in the game) for an exclusive webinar.
In this special one-time event, they revealed their thoughts on today’s top-heavy market… how to position your portfolio when you’re skeptical about the world’s current political, social, and economic problems… and how to create a wealth-generating portfolio that will support your family for years to come.
A video replay and transcript of Tuesday’s webinar are now available to Diary readers… for free. And you can check them out here for a limited time.
BY CHRIS LOWE, EDITOR AT LARGE, Bonner & partners
But the bookmakers’ odds suggest British voters will choose to remain part of the European Union when they go to the polls today.
As you can see from today’s chart, the gambling odds now imply a 75% probability the Brexit camp will lose today’s referendum.
That’s up from about 60% a week ago.
Oil Stocks Just Broke Through a Critical "Trend" Line
One longtime resource expert explains how the oil and gas industry has completely collapsed. But now a select few oil stocks are poised to thrive in the aftermath…
How Today’s Brexit Vote Will Affect Your Portfolio
It may be increasingly unlikely, but a Brexit vote could deliver a bearish blow to stocks. And a vote by Britain to remain in the EU could trigger a relief rally.
Trump’s Scottish Golf Club Disaster
Trump is flying to Scotland this weekend to check in on his gold club there. But it might not be such a fun trip. Trump has reported to Scottish authorities that he has lost millions on the club.
Bill’s story about former CIA Director Colby is chilling… Have you had any personal encounters with the Deep State that you’d be comfortable sharing with your fellow Diary readers? We’d love to hear them. Write to us at [email protected].
For today… a Trump-filled Mailbag in response to yesterday’s Diary about whether The Donald will be a champion of America’s working class.
Bonner is brilliant. I agree with his comments on Trump and Hillary.— David S.
I beseech you, Mr. Bonner, to consider that Donald Trump is not a legerdemain at all! He is a thoughtful sincere individual who sees that this nation is sinking like the Andrea Doria. He’s doing what he should do under the circumstances: try to save the ship.— Marylin G.
Trump supporters that I know don’t have much expectation that he will improve THEIR situation; they see him as undoing the foreign stupidities, tossing out the alien riffraff, ending the thug rule – and MAYBE, just maybe, fixing the monetary madness.— Emily S.
Trump is nothing but a blow-hard fraud! He drained his casinos in Atlantic City. Loaded them up with debt, then stuck everyone else for his losses. Just read the New York Times expose.
He is ignorant on foreign policy, health care, gun control, etc. etc., and an irrational, contradictory, bully.— Harry M.
And finally, a reader weighs in on Bill’s account of how banks create money out of thin air in Monday’s issue, “The Fed’s ‘Doomsday Device’ Is About to Explode.”
You are right about how new money is created when a bank makes a loan. However, as well as money creation, there is also money destruction. This happens when the borrower pays off a loan.
For example, take a $100 loan at 5% interest. $100 is created and deposited into the borrower’s account. That’s new money. As the borrower repays the loan, the repayments are debited from the system (the money is destroyed), until on the final repayment, all of the $100 has been destroyed. It existed, and now it’s gone.
However, the borrower is charged 5% interest and repaid $105. It’s this $5 that never gets destroys and remains in the system ad infinitum. It’s interest on loans that is (partly) responsible for inflation.— Andrew D.
A video replay and transcript of Tuesday’s special webinar featuring Bill, Porter Stansberry, and Chris Mayer is now available free to Diary readers.
Don’t miss out on this opportunity to hear three of the top names in financial research discuss their personal strategies for investing in this complicated market environment. Check it out here.