BALTIMORE – What do you get your wife for her birthday?
Here’s a suggestion for the woman who has everything: Get her an oil rig.
The daily rental rate was about $500,000 in 2014. Now, you can get it for half off.
And the price could go lower. When the industry was flush and foolish, drillers put in their orders for new rigs. Those rigs are still being delivered, even though the number of idle rigs is now the highest in history.
Unfortunately, many of the companies that ordered the rigs borrowed the money to pay for them. That’s what you do when it looks like the sky is the limit.
Then, when the sky falls on your head, you don’t have any way to pay your loans. Borrowers default. If enough loans go bad… lenders go broke, too.
But we’re not going to worry about it today…
We’ve got other things to worry about. Big things. At least, that’s what the chief economics commentator at the Financial Times, Martin Wolf, tells us.
He says our great republic is in danger of being hijacked by a “narcissistic bully.” You know who he’s talking about. And he says that if Donald Trump wins the White House, it “would be a global disaster.”
How does he know that?
Would it be less of a global disaster if Marco Rubio, Ted Cruz, or Hillary Clinton were elected?
Fortunately, Mr. Wolf is wrong about everything. And when he quotes Robert Kagan, a war-mongering Washington insider and Deep State mouthpiece, telling us that Trump is the “GOP’s Frankenstein monster,” we begin to feel a warm affection arising for The Donald.
We are stoics, here at the Diary. Yes, the people may vote in a monster. (What choice do they have?) Yes, Trump may be a global disaster. But at least the voters will get what they deserve.
And if it is Mr. Trump who gets the crown, we have no real reason to think he will be a more benighted and misbegotten ruler than any of the others.
Besides, the election process is an exercise in solemn deceit.
The U.S. government is among the oldest in the world. It works, on paper, more or less as it was meant to do. But in practice, it is as far away from the federal government of 1789 as downtown Los Angeles is from the little Mexican village on that spot 200 years ago.
For one, government has become a much bigger business. As it added to its own wealth and power, smart people discovered how to use it to get wealth and power for themselves.
Lobbyists, insiders, and the elite figured out how to get special treatment – privileges, favors, tax breaks, contracts, sinecures.
The Pentagon got weapons it didn’t even want. The corn states produced ethanol consumers didn’t want or need. And the Deep State – a permanent government of bureaucrats, think tanks, cronies, special interests, zombies, and politicians that nobody wants – made elections merely gestures of mass mythology.
We are supposed to believe our vote can change the course of an election… and that our candidate can change the course of history.
Like most myths, it can’t be disproven. But the odds of it are extremely remote; rye whisky will accumulate in rain barrels first.
The Deep State decides important matters, not elections. It decides who gets what, for example. And its new money system – put in place by President Nixon in 1971 – makes it possible to shift money to idlers and chiselers, without even a token vote in Congress.
A rentier is someone who gets his money without providing anything in return. The game is rigged in his favor. He uses the power of the government to enforce an unfair deal.
The old rentiers of the 17th and 18th centuries held title to land – which probably dated from some ancient conquest. They “earned” their living by renting that land to tenant farmers.
The new rentier rents money. He gets it for next to nothing. And he rents it out at market rates. The system is so subtle… so clever… and so complex that even today not one person in 1,000 understands what is going on.
The common folk know something is wrong. But they don’t know what. So, they turn to Trump, who promises to “kick ass”… or to Bernie Sanders, who promises to tax and spend on their behalf.
Do Sanders or Trump have any clue as to what is really going on?
Have they already made peace with the Deep State?
As for Rubio and Clinton, they were the Deep State candidates from the get-go – both promising more intervention… more wars… more programs… more this, more that…
…all of it to further the interests of the Deep State and its clients.
Tomorrow… we bring this series to a spectacular close…
Further Reading: It doesn’t matter who wins the race for the White House. America’s “shadow government,” the Deep State, already controls just about every aspect of your life. From health care to education to the food on your table to the never-ending War on Terror, the Deep State is pulling the strings.
In The Bill Bonner Letter, Bill exposes how the cronies behind the Deep State have pushed the world to the brink of an irreversible disaster. To find out how that disaster will unfold and, more important, how it’ll change your life forever, follow this link.
BY JEFF BROWN, EDITOR, EXPONENTIAL TECH INVESTOR
Editor’s note: Tech expert Jeff Brown devotes himself to scouring the market for the next breakthrough technology stock. Today, Jeff shares a new story about an exciting area of technology.
Becoming an “astronaut” is about to be more common than you think.
Thanks to developments in materials, propulsion, and other aerospace technologies, it is just around the corner.
Flying at an altitude of 62 miles above sea level will get you recognized as an astronaut by NASA. It’ll also give you a weightless, extraterrestrial travel experience.
As attendees of my December webinar know, I’ve always wanted to be an astronaut. That’s why I’m closely following several companies that are developing a space tourism industry.
Perhaps most widely known is Virgin Galactic. The company is building a fleet of five SpaceShipTwo spacecraft. Each is designed to take several paying customers into space for about five minutes of weightlessness… and unbelievable views before returning to earth.
Virgin Galactic is testing SpaceShipTwo this year. It is expected to have its first commercial flights within the next 24 months. The flights will launch from Spaceport America in New Mexico, which has been billed as the world’s first purpose-built commercial spaceport.
Blue Origin, a private company founded by Jeff Bezos, the CEO and founder of Amazon, is also active in the space tourism industry. The company recently successfully demonstrated its New Shepard VTOL (vertical takeoff and landing) booster technology.
It will continue testing this year and could potentially have commercial flights for customers in 2017.
Another interesting company is XCOR Aerospace out of Mojave, California. It has been developing its Lynx sub-orbital spacecraft that will begin flight testing this year.
Even more exciting, private company Space Adventures is developing Deep Space Expedition Alpha. This project will take space tourists for a trip around the moon and back to Earth. The first civilian moon expedition is targeted for a launch in 2018.
As the space tourism industry grows over the next two to three years, I expect several space tourism companies to go public. And I’ll be keeping an eye on them as potential investment opportunities for readers of my advisory letter, Exponential Tech Investor.
As for me, I fully intend to take advantage of this technology trend by becoming an astronaut.
Editor, Exponential Tech Investor
We’re on the Verge of a Global Banking Collapse
One veteran market expert explains why the world’s banking system is unsound and what differentiates a sound bank from an unsound one. He also predicts that it will ultimately lead to worldwide banking collapse.
Koch Brothers Will Not Use Funds to Block Trump
Three sources close to the Kochs said the brothers are concerned that spending millions of dollars attacking Trump would be money wasted, since they had not yet seen any attack on Trump stick.
The Great Corporate Earnings Fraud
Corporations are getting desperate to justify the record number of stock buybacks that are keeping the market afloat. So companies are going even further to give the illusion of increased profits.
Today, readers respond to yesterday’s mailbag questions: Have you taken advantage of bullion’s 15% rise so far this year? Do you plan to?
I am adding positions to my IRA, such as CEF [Central Fund of Canada] and several Sprott ETFs in gold and silver. The miners will come later. But I did add SGDM [Sprott Gold Miners ETF].— Phil G.
Gold has entered a bull phase, which I will trade later. There’s no rush. The bull run will be with us for the next two or more years.
Be ready to get off the bus in time for the following bear phase, which will take gold right down again. Mind you, by then we will have been shell-shocked by the thunder of crashing stock markets and be choking on the dust.
Keep telling us Bill. I live in New Zealand and enjoy reading your writing.— Warren C.
Right now I am 90% gold and silver and 10% cash. Zero debt and lots of ammo.— Brian S.
I have watched as gold has risen in recent months but have not taken advantage of the increase in value because I am a long term precious metals purchaser.
While existing in the low middle income bracket with no income increase in past three years, I have been able to purchase $3,000-$5,000 each year since 2009 of either silver or gold coins.
I look as this investment as a long term situation. The “deep state” insurance policy for me is these coin investments. If the day would ever arrive that central banks are no longer able to control the price of these coins, I might make it into the upper middle class bracket!— Skip E.
Hello, Bill. I always enjoy reading your letters. As for gold, I have already done well, thanks to Agora’s advice.
Outstanding Investments long ago recommended Silver Wheaton, which I have held and added to for years (tough to do a while ago when it dropped so much).
I also purchased the recommended options on Royal Gold, which I sold after a double, along with Alamos Gold, whose shares I own but already sold the options, again happy with a double.
I have always been a coin collector and have pure silver coins from Canada (both collectables and bullion) China (Pandas), U.S. (Liberties), Mexico (Libertads), Australia, Austria, New Zealand, and a few others.
I do not have a lot of gold coins, a few Canadian 1-ounce collectables, a ½ ounce Panda, a ½ ounce rare South African Kruggerand (only 850 minted). I also have almost every Canadian silver kilo coins, several very low mintage (450 & 600 minted, max).— Joe M
And finally, one reader is upset with yesterday’s Diary headline…
Did you forget something with your “Not-So-Super Tuesday” headline? That reminded me of the unsavory car dealers of a few years back – bait and switch. You gave us the headline, but you didn’t follow up.— Ken G.
Chris comment: The headline on yesterday’s Diary was “Why Super Tuesday Voters Were Wasting Their Time.” The same could be said of anyone hoping to change the course of the country by casting their vote at the ballot box.
As Bill put it in yesterday’s issue:
Just convince the plain people that they can play a role in government. Not only will they stand in line at polling stations before dawn… as they did in Virginia yesterday during the Super Tuesday presidential primaries.
Also, they will send their sons to die in your wars… and pay more tax, believing it is for their own good!
In Case You Missed It…
One of our colleagues at Agora Financial recently conducted a “social income experiment” on the streets of Baltimore.
In this entertaining demonstration, he shows two people with absolutely no investing experience how to make $127 in the market in less than three minutes.