Bill Bonner: The truth behind the Trump brand

From Bill Bonner, Chairman, Bonner & Partners:

ÎLE D’YEU, FRANCE – Today, we climb a hill and have a look around.

Down below is a hidden cove on Île d’Yeu:

The hidden cove on the French island of Île d’Yeu

The hidden cove on the French island of Île d’Yeu

But let’s get serious…

$700 Billion Boondoggle

Out to our left, under dark clouds, is the political situation.

For the first 16 years of our daily commentary (in these pages and in The Daily Reckoning), we hardly bothered to look.

Through the Clinton, Bush, and Obama administrations, nothing much changed.

Then Donald J. Trump brought fresh air… or an ill wind… depending on how you looked at it.

We guessed (but were unsure) that this new breeze would be little different from the prevailing winds of the previous 20 years.

It took a few months to tell the tale, but now we know: We were right. Instead of draining the swamp, as promised, the Trump team adds more slimy liquidity.

For example, the junta generals – Mattis, McMaster, and Kelly – and their cronies got a big payday this week. Seven hundred billion dollars went into the swamp. Reports The New York Times:

The Senate has overwhelmingly approved a sweeping defense policy bill that would pump $700 billion into the military, putting the U.S. armed forces on track for a budget greater than at any time during the decade-plus wars in Iraq and Afghanistan. [… ]

The 1,215-page measure defies a number of White House objections, but President Donald Trump hasn’t threatened to veto it. The bill helps him honor a pledge to rebuild an American military that he said had become depleted on former President Barack Obama’s watch.

That’s right: 1,215 pages of boondoggles, designed and written by industry lobbyists.

Secretary of Defense Mattis wanted to save a paltry $10 billion by closing unneeded bases.

No way!

Every puddle of the swamp will be treated like an endangered wildlife habitat – preserved, protected, and promoted.

Thunderheads Gather

With this novel political situation on the horizon to our left, we turn to look at the money world on the right.

There, too, dark thunderheads gather.

As we saw yesterday, key indicators of U.S. economic health are flat. Corporate sales and profits… along with wages – after accounting for inflation, they’ve barely budged over the last 17 years.

The reason?

We have only to turn our head back to the left – to politics – to see why: So many resources get sucked into the swamp.

Myth and Marketing

A society only gets richer by saving money and investing it.

If the investments are successful, output increases. This extra production is what makes us wealthier.

But it only works if: (a) the savings are real, in the sense that they represent real resources, not just phony-baloney pieces of paper or empty Fed credit, and (b) the investments are win-win. That is, they must be made by real investors with “skin in the game.”

When the feds say they are “investing” in our future… or “investing” in a fairer society… or “investing” to stimulate the economy – it is all claptrap.

They have no skin in the game… no real money to invest… and no reason to care if the investments pay off or not.

Often, as we explained yesterday, they prefer for them to fail, since that only encourages them to do more.

In the end, what they are doing is shifting real resources out of the productive economy toward the win-lose parasitic economy… where wealth is consumed and wasted, not produced.

Mr. Trump’s appeal, such as it was, was that he seemed ballsy enough to “Drain the Swamp,” letting resources go back to where they belong: the productive Main Street economy.

His brand was to defy the Deep State, the insiders, Congress, the Establishment, and the powers that be.

But it was all myth and marketing. Behind the brand advertising, Mr. Trump is a self-promoter, not a revolutionary.

He has instincts – some good, some bad – about how an economy works, but no coherent theory.

And without a compass to guide him, he is like a cruise ship lost in a hurricane… pushed by the winds and waves…

… right into the swamp.



Crux note: As Bill mentioned, even the president seems unable to reign in the influence of the Deep State. And this group of unelected insiders now control nearly every aspect of American life. But in this online presentation, Bill shows why the Deep State’s continued presence is setting the U.S. money system up for a major shock. You won’t hear this warning on CNN or Fox News, but you can get all the details right here.

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