Emma’s Note: Bill is thankful to be back in the U.S. and spending Thanksgiving with his family. After nine months in lockdown at his ranch in Argentina, they have a lot to catch up on.
So today, we’re revisiting another of Bill’s past essays.
We’re back in 2016 again… Donald Trump has just been elected president, having promised repeatedly to “drain the Swamp.”
But the insiders knew better…
BALTIMORE, MARYLAND – “Fight Trump! Fight Trump! Fight Trump!”
There must be rejoicing in “flyover country,” where “The Donald” is regarded as an American hero.
But long faces dominate on the two coasts, where he is considered a sort of biblical curse visited on the Establishment by vengeful gods.
Last night, we heard chanting out on the street near our Baltimore headquarters. A small crowd of protesters stopped traffic, briefly, on Charles Street.
So far, up in our office, we’re enjoying a jolly revolution.
Hillary supporters are whining and kvetching. They would be “soul-searching,” if they had souls to search. Instead, they are figuring out how to hold on to their zombie incomes, crony deals, and claptrap theories.
Drain the Swamp?
We got a report from the Soho House private members’ club in Los Angeles:
Oh Dad, you wouldn’t believe it. Hollywood is so liberal… so politically correct. Many of the people in the club were shrieking when the state-by-state results came in. They were in a panic. I was afraid they were going to jump off the roof.
But we will neither celebrate nor look for a sharp object. Instead, we’ll put on our thinking caps. What will a Trump presidency really mean?
To many, including many of our own dear readers, a Trump in the White House means a victory over the insiders. He is supposed to bring “a new political order,” says The Wall Street Journal.
Didn’t he promise to “drain the Swamp”? Didn’t he stand up to the Deep State? Won’t he do to Washington and Wall Street roughly what Sherman did to Atlanta?
“See,” they say triumphantly, “voting does matter. With our man in the White House, no dream is too big. Now, we’ll make America great again. Won’t we?”
But you don’t pay us to cheer with the winners or chant with the losers. In fact, you don’t pay us at all, which makes our comments worth at least what you pay for them.
Sometimes right… sometimes wrong… and always in doubt… we just try to connect the dots.
So let’s take a look…
Fox in the Henhouse
Trumpism hit the markets on Tuesday night, like a fox entering a henhouse.
Panic broke out. Feathers flew. At one point, the Dow futures seemed to be heading to an 800-point loss.
But when the sun came up, the hens were still alive. And a Trump presidency didn’t seem so bad.
Mr. Trump never suggested that he would root out the real problem behind low growth and high inequality: the Federal Reserve’s fantasyland credit system.
Nor did he ever claim to be an austere conservative. He will not cut spending. He will increase it.
“Stocks surge as investors put money on stimulus,” reports The Wall Street Journal.
Banks and jail operators soared. Apparently, the markets don’t think Trump will be bad for Wall Street or the prison industry. Pharmaceutical stocks rose, too. What does that mean?
Investors must not expect Trump to shake up the medical cronies or lower the cost of drugs.
Other big winners include defense and infrastructure stocks. What? Wasn’t Trump supposed to stop these dumbbell wars and bring the Pentagon to heel?
Pour More Concrete!
And as for infrastructure… we could almost see smiles on two of our favorite claptrap economists – Larry Summers and Paul Krugman.
Both have urged the feds to do precisely what Trump now proposes to do: Pour more concrete.
The drumbeat for a massive infrastructure spending program will be more apparent later when the next crisis appears. But you could have seen it coming for months.
The insiders are desperate to keep the feds’ credit money system alive. But monetary stimulus measures have flopped. All that is left is fiscal stimulus – old-fashioned Keynesian deficit spending.
The president-elect promised it on election night. And markets have – rightly or wrongly – believed him.
They are betting that Donald J. Trump will come into the White House not with a stiff broom, but with more dirt… that he will come not to bury the Deep State, but to save it.
They are probably right.
P.S. American voters have been stabbed in the back by Washington insiders. With the election all but over, the real crisis begins. In 2021, either the dollar will break under the burden of huge U.S. deficits, or the U.S. bond market will. Both pose the single biggest threat to your retirement. There is only one real way to save it.
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