| By Bill Bonner, Chairman, Bonner & Partners To dream the impossible dream To fight the unbeatable foe To bear with unbearable sorrow To run where the brave dare not go – “The Impossible Dream (The Quest),” Man of La Mancha BALTIMORE, MARYLAND – We left off yesterday promising to rev up the chainsaw. We’re searching the woods, hills, and urban jungles for the coveted “magic money tree.” Family: arbor. Genus: pecunia. Species: magicae. For thousands of years, alchemists, grifters, and proto-central-bankers have tried to find it. But it has remained as elusive as the Himalayan snow lizard and the American jackalope. But it must be out there somewhere. Everyone believes it, including the president of the USA. “Give me some of that money,” says he. And yesterday, the magic money tree – aka MMT… aka Modern Monetary Theory – was in full flower. CNBC: Stocks rose on Monday as the market’s rally to record highs resumed amid increasing expectations that China and the U.S. will reach a so-called phase one trade deal. The S&P 500 and Nasdaq Composite hit all-time closing highs as they rose 0.8% to 3,133.64 and 1.3% to 8,632.49, respectively. Both indexes also notched intraday records. The Dow Jones Industrial Average also had a record close, gaining 190.85 points, or 0.5% to 28,066.47. President Donald Trump tweeted about the record, saying: “Enjoy!” | Recommended Link | | It’s NOT Bragging If It’s True (New Briefing Reveals His Next Big Prediction) The man who called the #1 best stock of 2016 and 2018 is at it again. He says a federal agency that regulates more than $2.6 trillion annually… along with the brightest minds at Harvard and MIT… have just unlocked the single greatest tech breakthrough of his career. A small-cap stock is now set to soar up to 1,000%… in just one day. But that’s not all. Within 12 months, it could turn a tiny stake into an entire nest egg. And it could start as soon as 9:30 AM tomorrow. |
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MMT Myth The idea – given to us by David Graeber, Elizabeth Warren, Thomas Piketty, and a whole cast of MMT enthusiasts and half-wit hallucinators – is that money really does grow on trees. It is just a matter of political willpower, they say… even courage… to put it to use. Donald Trump, for example, displayed that kind of courage when he pushed for a tax cut in December 2017. The Fiscal Times estimated that the cut could add $24.5 trillion to the U.S. debt over the next 20 years. Where will the money come to pay for it? The magic money tree, of course. Even otherwise sane and sensible economists, such as our friend Richard Duncan, think the time has come when the feds can take advantage of free money (from ultralow or even negative interest rates) to work wonders. They can rebuild U.S. infrastructure… and provide coast-to-coast free broadband… free university education… and a guaranteed income. Some people even think it is vitally important… or even unethical not to do it. With this cash, they say, we can right the world’s wrongs… cure its ailments… and wash away its sins. And why not? Why not stop global warming… if it can be done at no cost? Why not help the poor… heal the sick… and raise the dead? Too Good to Be True Sounds great, doesn’t it? Almost too good to be true. So, maybe some due diligence is in order… First, how is it that this magic money tree has remained hidden all these many, many years? Isn’t it remarkable that through periods of stark, dismal poverty… famine… financial chaos and collapse… nobody ever stumbled on the magic tree? That is, we know of no episode in history… even when people were starving by the millions and desperately begging for pennies… when the discovery of this magical tree solved the problem. Instead, they had to work their way out of every financial crisis… slowly and painfully, regretting every dime they spent when they were flush. Why? Second, there are many episodes in history when people thought they had discovered the wondrous tree… only to be rudely disappointed years later. John Law thought he had one in his offices on the Rue Quincampoix. People lined up outside to get his new “money”… backed by shares in the Mississippi Company. Hugo Chávez thought he had one in Venezuela – one with deep roots into the country’s oil fields. And dozens of countries – including Greece, Brazil, Germany, and Argentina – have printed up omega-zillions in their own currencies. By just adding a zero, they discovered, they could multiply their money 10 times. But if governments and central banks really could create real “money,” residents of Harare and Caracas would have a lot more real “money” now. Instead, in every case, the money tree yielded enormous quantities of paper money, but the magic went out of it just when they needed it most. | Recommended Link | | Why America’s Next War Will Be Fought INSIDE Your Home America’s most formidable enemy has a new high-tech weapon. It can hit your home without dirty bombs, gunmen, or missiles. The FBI admits this force has been striking us since March 2016. And according to Reuters, the Feds are concerned about more severe attacks in the months ahead. Just recently Homeland Security came up with a solution to protect American communities. Bloomberg reports this solution is the birth of a 6,400% growth industry. And billionaire investors including Jeff Bezos, Bill Gates, and Richard Branson are rushing in to make millions. Paydays that are bigger than anything you’ve seen could be waiting for you too. |
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Fruit of Progress? But wait. Maybe this is just another fruit of modern, technological progress – like the iPhone? When we were little, in order to make a phone call, you had to first pick up the heavy receiver… make sure no one else was on the line… and then turn the numbers in sequence on the rotary dial. Now, with ultramodern communications, we can get the weather… receive correspondence… and even watch dirty movies – all on our iPhone. Has the same sort of progress come to the money world, where things that were impossible a few years ago are now commonplace? Is the sad experience from other “money tree” episodes now irrelevant… because we are all so much smarter… with so many cool new tools to work with? Toughest Question This is the toughest question. Just because something never happened before doesn’t mean it won’t happen now. And maybe genetic engineering has produced something that never before existed… something that was considered impossible – a magic money tree. But wait. How would that work? A printing press can produce all the currency with all the zeros you could possibly want. Currency is not money. It’s only money if people are willing to trade their time and wealth for it. That’s the trouble with hyperinflation – fewer and fewer people are willing to make the trade. Eventually, no one will. Then, the currency becomes worthless. So, if there were a magic money tree, it would have to do more than the counterfeiters working for the feds. It would have to create not just pieces of paper called “money,” but products and services – real wealth, real money – equal to the currency. How could it do that? Still seems impossible… Regards, Bill Like what you’re reading? Send your thoughts to feedback@bonnerandpartners.com. FEATURED READS A Rising Generation Changes Party Precedent
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Colleague and gold industry insider E.B. Tucker shows you why gold is about to get a lot more profitable next year… MAILBAG On Friday, Bill reminded us that when it comes to government, situations are either “win-win” or “win-lose.” But one Dear Reader believes there is a third option… Dear Mr. Bonner, I always appreciate your very educated perspective on finance and world events. Perhaps I could convince you there is another scenario for both parties to get what they desire in a bargain. My observation is this particular scenario is, in reality, what most actually get. Instead of “win-win” or “win-lose,” it appears that “win-kick the can down the road/delay a decision” usually occurs in government and interpersonal events. As you noted last Monday, in time the bill must be paid. Rational minds realize this, but many times we (humans who are emotional vs. rational) prefer to deny that the price for today must be paid… until later. I believe you would agree poor parenting and government education have produced people expressing “feeling” vs. “thoughtful, logical, rational” decisions. Thanks for enlightened information and a grimace or two. – Wes W. Meanwhile, others disagree with Bill’s recent assessment of President Trump’s economic policies… Nonsense. Big business and small got a sizable tax cut. But businesses only collect taxes from customers and pass them on to the IRS. That basic understanding escapes most because schools don’t educate anymore, but teach social propaganda. Raising business taxes raises costs to consumers. That’s a fact. But as Joe Biden famously said: “We choose truth over facts.” Bill is wrong. Trump’s policies are helping the forgotten and the middle class. Unemployment figures and rising hourly wages, along with a decline in numbers on food stamps and other federal assistance programs are proof. And he is fighting the Deep State and its accomplices in the media and the opposition party. But as Bill says, Rome wasn’t built in a day, and Trump has little help. The impeachment effort is part of that fight; don’t kid yourselves. – Erich K. Donald Trump is the best president we ever had. He is at least trying hard to Make America Great Again. If the Democrats were to do their job properly, the country would gain a great deal. However, the Demos don’t care. They are so peed off about losing that they can’t think straight. The Demos could do a lot to solve the border crisis and, as a result, the welfare crisis. Anyhow, I prefer Trump to Hillary and the Deep State. – Robert C. When it comes to government, is Wes’ third option above more often a reality than Bill’s “win-win” vs. “win-lose”? Are Trump’s policies helping middle class Americans as Erich K. believes? Write us at feedback@bonnerandpartners.com. IN CASE YOU MISSED IT… Can a 50¢ Stock Make You Rich? (Ask This Millionaire…) For most people, NO. But for millionaire Doug Casey, it’s “more times than I can count.” Now he’s spilling one of the biggest opportunities in decades. And why the best way to capitalize on this new trend is to buy 5 tiny gold stocks… (At this moment, one is trading for less than 50-cents.) But fair warning: This situation is unfolding quickly. You don’t want to sit this opportunity out. Watch The Video Now. 
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