BATLIMORE – “Hold your nose and vote.”

That’s the advice we’ve been getting lately. Even our minister, on Sunday, encouraged his flock to vote.

“For whom?” we wanted to ask.


Caligula or Nero?

We closed our eyes. We tried to imagine it. But we couldn’t picture Jesus Christ in the voting booth.

Would he really hold his nose? For whom would he cast his ballot? And why would he cast a ballot at all, if he had to hold his nose to do it?

“Render unto Caesar the things that are Caesar’s,” he said, to escape a trap.

When they come after you for taxes, you gotta pay, he implied.

But in what version of the New Testament would Jesus participate in choosing the next Caesar?

“You’ve got to vote,” say the Pharisees. “It’s your civic duty.  Which will it be? Caligula or Nero?”

We know many of our readers are outraged. They can’t imagine why we wouldn’t pull the lever for Donald Trump. They’re sure he’s the only thing standing between America and doom.

Maybe. But here at the Diary we are sometimes right. Sometimes wrong. And always in doubt.

Would Jesus pull the lever for either Trump or Clinton? 

Silence of the Machines


…that sound that you don’t hear… that dozer you don’t see moving earth… that road not being asphalted… or that ditch not being dug…

…that’s what the world’s largest maker of mining and construction equipment, Caterpillar Inc., told us about on Tuesday.

It reported that sales were down again this year – for the fifth year in a row. And it announced it had to cut its profit forecast again, for the third time this year.

Oh, woe! The poor yellow machines! Spiders are building their webs in the unsold inventory… confident of being unmolested.

Sales are off nearly 20% since 2015. Earnings have fallen, too.

Caterpillar sells worldwide. So it is not only in Teaneck or Tulsa that the yellow machines are silent. You won’t see many new ones in Tianjin or Timbuktu either.

Since the crisis of 2008, world trade growth has averaged only half the rate of the preceding half-century.

Why was trade growing so fast before the crash?

Because some countries make things better than others. A cellphone, for example, might have been designed in California and assembled in China, with components coming from Japan, Germany, and Malaysia that had been fashioned out of raw materials from South America and Australia.

That meant a lot of ships and a lot of trucks… and a lot of yellow machines building the infrastructure to keep them moving.

But now, the entire world seems to be cooling on the idea of globalized commerce; the yellow machines are slowing down.

Ageing Economy

Nobody knows why… but several hypotheses have been put forward.

In these pages, we’ve focused on one of them: Caesar has perverted our commerce, our economy, and our society… with his fake money and crackpot economists.

He has teamed up with his Deep State cronies to transfer trillions of dollars to the insiders and zombies, penalizing the productive economy and punishing savers and workers.

He has driven down growth rates, boosted financial asset prices, and increased debt to bubble levels.

But that is not all that is going on. Today, let’s look at another hypothesis: deteriorating demographics.

People in the developed world are getting older. As they age, they stop spending so much money. They stay at home rather than go out to dinner. They take vacations near home, visiting their children and grandchildren, rather than travel abroad.

And as for the latest gadget, they find it a bother, not a “must-have.”

Not only do older people tend to consume less, they also tend to produce less and save less. This further slows down growth. As they age, they withdraw capital from the productive part of the economy; they leave the diligent ants and join the wastrel grasshoppers.

A new paper from the Fed tells us that “demographic factors alone account for a 1.25% decline in the natural rate of real interest and real gross domestic product growth since 1980.”

Is this true?

We doubt it. But demography is a big deal. Governments’ old-age pensions and medical-care programs are a claim on future wealth.

As growth rates decline, those programs will default… one way or another.

Benefits will be cut – either purposefully, by the government… gradually, through inflation… or suddenly, by involuntary bankruptcy. 

Again, we don’t know what Jesus would do. But we’ll bet we know what the old folks will do. They’d vote for the Devil himself if they thought he’d protect their pensions and medical benefits.

Caesar won’t cut the programs; instead, they will go broke.

Tomorrow… another hypothesis.




Further Reading:  Yesterday, Bill revealed the unpopular answer to a popular question about this year’s presidential election in the latest issue of The Bill Bonner Letter.

You see, elections have only a marginal effect on important policy decisions. Real power is held – as it always is – by insiders known as the Deep State. The whole sinister plot is uncovered in an urgent video from Bill. Watch it here now.


Market Insight


The crackpot economists are hard at work in Europe, too.

Last year, the European Central Bank launched a $1.2 trillion QE program. It’s also pushed its target lending rate into negative territory.

But as you can see from today’s chart, this much-hyped “stimulus” has been in vain.

Over the past 12 months, Europe’s equivalent of the Dow, the Euro STOXX 50 (SX5E), is down 12%.

That compares with a 3% gain for the Dow over the same period.

Featured Reads

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The Next 10 Years Will Be Ugly for Your 401(k)
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The Fed’s Only Escape Is to Trash the Dollar
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Some great feedback today on yesterday’s Diary, “Did the Feds Destroy the Family, Too?”…

Although most of today’s Diary is excellent, I disagree with the last part. Women having careers – which many do not primarily out of necessity, but out of desire to have an interesting and rewarding life – didn’t destroy the family. Lack of commitment of the husband and wife to each other has destroyed the family.

So what happened to women along the way? In the time of Christ, Mary – His Mother – had a career: She was a clothing designer and manufacturer. She ran a bakery and a food processing operation, as well as an eatery. She was an artist and a designer and a manufacturer, as well as a chef. Lots of room for creativity and self-expression. Today’s homemaker, unless she is an exceptional person, is a laundry-doer and a shopper. Who wouldn’t want another career today?

– Dave F.

Wednesday’s letter on the “good old days” was one of your best in my opinion. It mentioned and wrapped up many concepts that ran through my mind over the last few decades as I, along with the rest of Americans, watched our society change from one of relative stability to one of what seems to be nothing but uncertainty. The beaten to death phrase “slippery slope” applies here… even if the slope was relatively minor in the beginning.

– Brian B.  

The main killer of value in our economy is minimum wage. The bottom makes more, but what they make buys the same amount or less [as a result of inflation]. The minimum wage prices American labor out of the market. We can’t afford American labor, so we buy clothes made overseas, furniture from China, car parts made overseas then put together in America. Minimum wage has killed America.

– William R.

Very surprising about the disinformation in your recent issue about the U.S. having no central bank until 1913. Through all your association with Dr. Ron Paul, surely he would have advised you on how the Deep State (our “shadow government”) was initiated by Alexander Hamilton, in 1790, when he pushed through the nonsense of the First Bank of the United States.

Then the Second Bank of the United States, which Andrew Jackson finally got unchartered in Jackson’s second term of office. Why not publish the truth? That the Fed is really the Third Bank of the United States – just more Deep State shadow government.

– Norm K.

You are correct about the family. Growing up, mom stayed at home. And coming home from school mom was home. At our home, dinner was served at six o’clock. And if you didn’t make it, breakfast seemed a long time away.

Also, dinnertime was when you discussed what had taken place in your life that day. So, everyone was informed about each other’s activities. If you had questions, you had them answered by someone who loved you. Today, that doesn’t exist. The very definition of family has changed.

– Hipolito C.

In Case You Missed It…

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