Trick or Treat?

All governments are really ways for the elite few to lord over off the non-elite many. They tax. They spend. They hand out money to their clients and cronies. They inflate.

The character 'Leatherface’ from the movie ‘The Texas Chainsaw Massacre’. Source: Getty Images

Thursday, October 31^st, 2024 

Bill Bonner, writing today from Baltimore, Maryland 

Elections are sordid and preposterous affairs. But they are funny too. They seem to concentrate absurdity, mendacity, and stupidity, like the rays of the sun focused through a magnifying glass. 

The amusing thing is that everyone is in on it. It’s like the World Series in which everyone’s home team is in the playoffs. The fans show their colors — red or blue. They wave their flags and flaunt their slogans. They put signs in their front yards, to show the neighbors which side they are on. 

So let us do our part by asking a simple question: does it matter? Former Ambassador Chas. Freeman: 

It doesn’t seem to matter which political party controls the House or Senate.  Congress still can’t pass a budget or otherwise set national priorities.  When it’s not shut down, our government runs on credit rollovers.  Our debt is out of control.  So far this century, we’ve committed almost $6 trillion to wars we don’t know how to end.   

Still, the outcome of the 2024 elections may have an effect — especially on our money. We need to be alert. So, here’s the Executive Summary: 

Ms. Harris offers ‘more of the same.’ With her, we will continue our odyssey of war, inflation, bankruptcy and jackassery. 

Mr. Trump offers something different. On foreign policy, his ‘Big Man,’ tough guy approach may make things better... or worse. And on domestic matters he is likely to lead us into the same financial debacle as Ms. Harris... but perhaps sooner.  

More tomorrow... in the meantime...  

‘Dere’s dem dat’s smart... and dem dat’s good,’ said Uncle Remus. But in this contest, both candidates are neither good nor smart. And so what?  

Adolf Hitler didn’t have to be good or smart; he just had to refrain from invading other countries and killing people. And, today, we have a monument to Abraham Lincoln in Washington because he had more firepower than Jeff Davis, not because he was gooder or smarter.   

All governments are really ways for the elite few to lord over off the non-elite many. They tax. They spend. They hand out money to their clients and cronies. They inflate. They bungle. They boondoggle. They bribe. They bully. And they kill. Almost everything a government does is evil, stupid, or inefficient. The best leaders are those who do the least of it. But neither of today’s candidates is proposing to cut back.  

Getting control of the US government means getting your hands on $6+ trillion of annual slush.  A big prize. To get it, the leading parties typically ‘run to the center,’ courting the moderate, middle-of-the-road voters... ending up with policies that are more or less tolerable to most people. 

But the center is the ‘more of the same’ that Donald Trump is running against. Like Milei in Argentina, he’s the ‘chainsaw candidate.’  Milei, though, has a well-developed set of free-market principles to guide him.  Trump does not.  He has the chainsaw, but doesn’t know what to do with it. 

Mr. Trump rose to prominence largely by spending his father’s money... and developing an anti-elite patois that made him attractive to the masses. He put his name everywhere he could — on casinos, hotels, airlines, universities – most of which went broke.  He ran full-page ads in the New York Times. And he prepared himself for today’s role by hiring a ruthless mentor — Roy Cohn.  

Cohn, as a young man, was toughened up by visiting his uncle in Sing Sing... and perhaps just by being a homosexual at an inconvenient time. He eventually died of AIDS, but not before showing Donald Trump his signature tactic. Cohn ignored the issues, the principles and the law... he simply attacked anyone who got in his way. This approach was later immortalized in Trump’s ghosted 1987 handbook, The Art of the Deal. If someone hits you, he advised, you hit back ‘ten times as hard.’ 

This Big Man mantra, unrestrained by grace, experience or truth, is the essence of the Trump personality. It relies neither on historical perspective, ideology, nor traditional values. Instead, it relies on the ‘will to power’ of the great man himself, with his instincts... his cronies... and his personal genius. 

John Flynn says ‘he’s the most flawed human being’ he has ever known. Mitch McConnell says he is ‘despicable.’ He ‘tries to divide us,’ said James Mattis. ‘... he’s unfit for office,’ said Mark Esper. ‘...a laughing fool,’ added John Bolton. Tom Bossert: ‘...an utter disgrace.’ ‘A domestic terrorist’ — Anthony Scaramucci.  

But if he balanced the budget and stopped the wars, would we care if he were a jerk? 

And Ms. Harris? Is she likable? Is she a paragon of virtue... a pillar of wisdom and rectitude... or a slimy California hustler?  

Was it her fault she was Willie Brown’s girlfriend and that he decided to launch her into politics? And it was just remarkable luck that she was available when East coast white guy, Joe Biden, needed a West coast DEI vice president. And it wasn’t she who made her boss shuffle and slur just months before the election... leaving her as the only viable replacement. 

And now, there she is, an empty boat…ready to go in whatever direction the elites steer her.   

So, enjoy the show. Wave the flag. Blow a horn. Send a contribution. Available on the internet is a tee-shirt you can purchase for someone’s birthday, with a quotation from Kamala Harris’s pensee:  

“The important thing to remember about this birthday was that on this day there was a birth, and that someone was born on this day.” 

Or maybe you’d prefer a Trump tee-shirt with this quote: 

They’re eating the cats 

They’re eating the dogs. 

They’re eating the pets of the people who live there. 

Mr. Trump is supposed to be the ignorant oaf — a description that is hard to argue with. But Ms. Harris is supposed to be educated and intelligent. Kamala tried to pry that gap wider on Monday, starting out with this: 

“There’s a big difference between he and I,” Harris told reporters...  

Huh? Where did she go to school? ‘Between’ is a preposition. It should be followed by the ‘objective’ pronouns... him and me... not he and I.  

A small thing, for sure. Makes no difference to the fate of the nation. But it highlights our conclusion for today: Both candidates are ignorant scalawags. 

More to come on the financial consequences of the 2024 election tomorrow. 

Regards, 

Bill Bonner 

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Research Note, by Dan Denning

The Fed’s preferred inflation gauge—core PCE—has not fallen in six months. It’s up 2.7% annualized over the last twelve months, according to data today released by the Bureau of Labor Statistics. Will the Federal Open Market Committee (FOMC) cut interest rates again when they meet after the election November 6th and 7th? And if they do, will bond yields, gold, and the dollar index keep rising together?

The chart above shows the core PCE index (ex-food and energy) going back to January of 1971. The rate of change may vary but the direction of travel for prices is always up in a fiat money regime.

The entire price level shifted 20% higher for Americans because of the government response (lockdowns) to the Covid-19 virus. And now the rate of change is still above the Fed’s target.

With $35.8 trillion debt, inflation isn’t a problem for the Federal government. It’s the policy. Invest accordingly.