GUALFIN, ARGENTINA – Our annual roundup… or yerra… began yesterday.

We go out on horseback early in the morning with our gauchos Gustavo, José, Samuel, and Natalio.

Pedro has a bad back and no longer rides.

The technique is simple: It takes two or three hours to get to the far end of the valley. Then we begin whooping and hollering to drive the cattle back to the corral.

But it is a big field. And the monte is full of sagebrush, cacti, gullies, canyons, rocks, and various varieties of undergrowth in which the cattle can hide.

We have two fields… or campos… of about 5,000 acres each. Yesterday, we did the campo to the west of the house. Today, we’ll sweep the campo to the east.

In each, we hope to find about 200 cows and calves.

Bill leads a cattle roundup on the Gualfin ranch

Enraged Bull

The herd is smaller than it used to be. We had to get rid of hundreds of animals during last year’s drought.

We try to get the animals in the corral by noon. Then we break for lunch.

In the afternoon, we drive the cows from the corral, one by one, through the chute… or manga… where they are locked in place so that they can be given vaccinations.

Male calves are castrated. Horns are cut off. The young females that will stay on the ranch are branded.

The whole thing is not for squeamish types with Bernie Sanders bumper stickers. And parts of it are dangerous. Driven to aggravation or madness, the cows – or bulls – will sometimes charge.

Once, we were in the pen when an enraged bull headed for us at top speed. Readers would be impressed by how fast a sixtysomething gringo writer can vault over a 5-foot fence.

Another time, on horseback, we chased a runaway bull. Then, at full gallop, we leaned over to lash the bull… the saddle slipped… and we tumbled onto the ground.

Yesterday, Samuel was in the pen when a young bull charged. He darted behind a post. But the bull circled the post fast and caught him on the leg.

In a cloud of dust, Samuel ran to the stone wall and hoisted himself over, with the bull hard on his heels. Today, he walks with a limp.

We’ll report more on this year’s yerra… tomorrow.

Ticks on a Dog

Meanwhile, we comment on Fed chief Janet Yellen’s revealing speech at the University of Michigan. Bloomberg:

“Before, we had to press down on the gas pedal trying to give the economy all of the oomph that we possibly could,” Yellen said Monday in Ann Arbor, Michigan. The Fed is now trying to “give it some gas, but not so much that we’re pushing down hard on the accelerator.” […]

“The appropriate stance of policy now is closer to, let me call it neutral,” Yellen said in response to questions during an event at the Gerald R. Ford School of Public Policy at the University of Michigan.

Yellen said she expected the economy to continue to grow at a moderate pace and that gradual interest rate increases “can get us where we need to be.”


Every society is ruled by an elite. They prey upon the common folks like ticks on a dog. They work their way into positions of power and influence, using a combination of brains, connections, and claptrap.

The mob generally looks up to them, impressed by the hocus pocus. And then, eventually, the ticks grow too many and too fat. The poor dog weakens… and the magic fails.

Where exactly we are in the process, we can’t be sure. But surely, we took another step toward the eventual catastrophe when Ms. Yellen spoke.

Everything she said was preposterous.

No Oomph

The economy is not growing at a “moderate speed.”

If it is growing at all – it depends on how you calculate consumer price inflation – it is doing so only at stall speed.

Officially, per capita growth is less than 1% a year. What kind of “oomph” is that?

Nor is the Fed neutral. How can you call a federal funds rate that is more than 100 basis points below the inflation rate “neutral”?

It is nothing of the sort. Ms. Yellen says she is “pressing down on the gas pedal.” There’s nothing “neutral” about that.

People who don’t respect the logic of their own metaphors are sometimes lazy thinkers.

Sometimes they are mixed up. And sometimes they are just blah-blah-blahing for the fake news media and the yahoos who believe it.

Ms. Yellen thinks the economy runs like a machine. If it is sluggish, it is up to her and other Fed engineers to press down on the accelerator. If it is running too fast, they ease off.

This metaphor is clearly absurd. If she and the Fed could increase the speed of the economy simply by pressing down on the gas pedal, what are they waiting for?

There are 66 million working age Americans without jobs.

Hey, why not give them a little gas?

Wealth Destroyers

Also, Ms. Yellen says she aims to get the economy “where it needs to be.”

But how does she know where it needs to be?

An economy is not a machine. And it never needs to be anywhere. It simply is where it is.

The authorities can slow it down with silly rules and regulations. Or they can mislead it with phony interest rates and fake money.

They can also force people into win-lose deals that waste capital, retard wealth building, or in some cases – the Soviet Union from 1917 to 1989, Germany from 1937 to 1945, China from 1949 to 1979, Venezuela from 2001 to 2017 – they even send the whole economy into reverse.

Self-respecting witch doctors and fortune tellers look at Ms. Yellen with contempt. She can make the economy worse. She can’t make it better.




Editor’s Note: Do you have what it takes to work with Bill Bonner? Bonner & Partners is currently looking for a new member to join our team. The ideal candidate is a rock star market analyst with experience in emerging technologies. A passion for researching and writing about cutting-edge tech is a must. To learn more about this opportunity, read on here.


Investing Insight

BY CHRIS Mayer, EDITOR, Chris Mayer’s Focus

Editor’s Note: Today, we share an insight on a potentially profitable investment outside the U.S. from Bonner & Partners chief investment strategist Chris Mayer.

Chris Mayer

Recently, I attended Grant’s Interest Rate Observer spring investment conference in New York City. One of the speakers was James Litinsky. He’s the founder and CEO of JHL Capital Group, based in Chicago.

And he presented an interesting idea…

There are surprising similarities between the U.S. circa 1980 and India circa 2014, when Narendra Modi became its prime minister. When Reagan was president between 1981 and 1989, it’s generally thought that taxes fell, the economy grew, and the stock market rose.

This is a comparison others have made. There is a lot to it, but similarities include a push toward:

  • Reducing regulations
  • Cutting taxes
  • Lowering inflation

And then there’s the charts below. First is the S&P 500 before and during Reagan’s first administration…

And here is India’s benchmark stock index, the NIFTY 50, before and since the election of Modi…

Now, the similarities, while interesting, prove nothing. There are also many obvious and important differences between India now and the U.S. in the 1980s.

Nonetheless, Litinsky made a good case for India as an investment destination based on the effects Modi’s platform and ongoing reforms will have on the economy long-term.

Litinsky is a savvy investor. His endorsement makes this something to consider. If you have been searching for investments outside the U.S., India might be just the opportunity for you.

Chris Mayer

Editor’s Note: One of Chris’ recent stock picks is up almost 100% in just seven months. To hear more about how he finds winning stock picks like this, watch Chris explain his system here.

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Today, readers continue to respond to Monday’s Diary, “Our Ranch Is Becoming a ‘Death Valley,’” and voice their opinions about the problems at Bill’s ranch.

If you want to make a profit on your ranch, do this: Get out of the beef (cattle business). That land will not make you a profit raising cattle! Switch to sheep!! This is an old story in the American West.

I grew up here, went to school with Basque kids in Nevada. I could show how to restore the land and make it productive. We could talk about dry farming your feed (requires no water). There is much I could tell you. Sheep do not need cowboys!! They will do well on marginal soil!!

– J. Jones

Tell Bill that if he wants to replace his ranch with one that is well watered and will never change due to its location, my family has a 3,090 acre ranch for sale in Texas and it is about as secluded as is possible. Decent rainfall (avg. 20 inches) annually.

A real cow/calf factory. We are ready to sell due our advancing age. It is truly a fine and scenic place. Fantastic game with 2+ miles of river running through it. Priced to sell.

– D. Sweeny

Mr. Bonner, Perhaps you can apply some high-tech to your water problem. In the air above your ranch, as water vapor, mixed in with the winds, are thousands of tons of water.

If you take some of it out to water your land it will be replaced the next few minutes, the next hour and the next day with thousands of tons of new water. It will never run out. The river of water you need is above your ranch. So, build a machine. Air goes in, is cooled to below the “dew point” as reported in each day’s weather report, and drains off your machine’s cold-side coils into your holding tanks.

You water your vineyards in some efficient manner like the Israelis do – drip irrigation or something. Perhaps you get enough water to keep some cattle going.

– J.S.

It’ll be a sad day when Bill and Elizabeth have to finally pull out of Gualfin. He’s the type of writer who makes you feel that you’re beside him, but the realities of the raw unforgiving world have caught up with him, in what he imagined was a bolt hole to escape it all. Tragic.

– B. Hay

About Rancho Gualfin: Failing as a cattle ranch, obviously could be re-purposed… excellent location for solar farm! High altitude, clean air, near equator, dry, nearly cloudless, plenty of nearly level land, seismically stable… so many favors for solar energy.

Don’t give it up cheaply, begin road construction and some early solar developments just to get started. What to do with the energy? Convert to chemical products requiring energy.

– K. B.

Hi, regarding the farm, can get into growing coffee? My grandmother had coffee in Kona. Don’t olives and grapes grow on hills? Good luck with the “owners”! I enjoy reading the newsletter!

– C. Gone

Mr. Bonner, I probably know the answer but in certain areas is it possible to drill wells?

I grew up on a family farm in southern Alabama where we used windmills. One at the home place, one in the south pasture and one at the barn. I believe our water table was about 20-25 feet. I am guessing in your mountains that table maybe several hundred.

So sad, I was praying that the ranch would at least break even, if you pull what will your friends do? Please keep us informed, love hearing about the ranch.

– N. Hall