Markets closed yesterday. So, we turn our attention to other things.
Our campaign to replace Ben Bernanke as the next head of the Fed went nowhere. The phone never rang. Instead, the post went to Janet Yellen, a woman who looks like she would make a nice fraternity housemother.
But we haven’t given up on a career in public service. Yes, dear reader, after 40 years of laboring in the hard ground of the private sector, we now aim for something new. We want to confront the issues of the day and do our part. We want to get involved in the major challenges of our time and “make a difference.”
Lately, we’ve been inspired by the office-holders who unselfishly “give back” all over the world. These role models incite a longing to join the ranks of the civic minded – those who work for the benefit of others, not just for themselves.
Also, we want to wallow in the public trough, feed on the government teat and enjoy the perks of high office.
Smoking Something Funny
Like the mayor of Toronto.
We don’t smoke crack here at the Diary. But who can honestly say he doesn’t like to get drunk once or twice a week? (And if some major crisis arises during our term in office, we hope to be at least as inebriated as Rob Ford at the time.)
Or how about the governor of New Jersey?
Chris Christie denies that he had anything to do with closing access lanes on the George Washington Bridge. But that’s just another perk, known well to kings, mafiosos and mayors everywhere.
“Will no one rid me of this turbulent priest,” asked Henry II in 1170. A short while later, the archbishop of Canterbury was dead.
“What can we do about these jerks in Fort Lee,” Chris Christie might have asked? Before he knew it, the traffic over the George Washington Bridge was hopelessly snarled.
If elected, we will intend to pose a few questions of our own…
• “What do you mean no one has audited Tom Friedman’s tax return?”
• “Why did Sweden’s central bank award Paul Krugman the Nobel Memorial Prize in Economics? Can’t it take it back?”
• “Will no one rid the nation of these zombie banks?”
And that’s just for starters…
When we look overseas, public service looks even more attractive…
President Clinton had his student intern. Governor Schwarzenegger had his housekeeper. But they were tawdry and lame compared to what a European office holder pulls off.
How about prime minister of Italy, for example?
For years, Silvio Berlusconi held his famous “bunga bunga” parties, with teenage hookers such as Ruby Heart Stealer. He didn’t have to lie about never having “sex with that woman.” He didn’t have to issue a public apology. He could just enjoy the perks of office that were available to him.
But our favorite is French president François Hollande…
Taxes, Headaches and ‘Gotcha’ Contracts
We lived among the French for 15 years, at least. (We stopped the clock when the French IRS audited us.) We learned their language and their ways. One thing we learned was that we couldn’t do a worse job of running the country than Francois Hollande.
You have to give the man credit, though. He is smart. He can be charming and witty. But in matters economic, he has nothing to guide him other than crackpot Keynesian theories and empty jingoes of France’s socialist elite.
That is why Paul Krugman was so cheesed off when he read the paper last week. He discovered that Hollande had tacked right. Hollande noted that France’s focus on the demand side hadn’t worked out so well.
France’s unemployment rate, for example, is twice as high as its next-door neighbor Germany. S&P’s recently downgraded France’s sovereign debt one notch from AA+ to AA. And anyone who has tried to start a business in France, as we have, would rather not do it again.
If you fail, they punish you with taxes, administration headaches and “gotcha” union contracts. If you succeed, on the other hand, they reward you with taxes, administration headaches and “gotcha” union contracts.
That doesn’t stop France’s well-educated and dynamic entrepreneurs, though. They still start up new businesses – in Britain and the US!
Krugman thought it was a “scandal” that Hollande was abandoning his claptrap principles. But our old friend Michel, on the scene in Normandy, reports that the whole thing is not so much scandalous as fraudulent. “There is no real shift to the right,” he tells us. “Instead, Hollande is just doing what he always does: throwing a bone to some of his friends in big business without undertaking any really major reforms.”
A Powerful Aphrodisiac
But what we admire about Hollande are his priorities. While all this is going on, the president of the Fifth Republic and leader of Europe’s second largest economy still finds time to get away on his scooter.
He leaves the Élysée Palace… and his “first lady” in the “madame wing”… to sneak off to spend some quality time with Julie Gayet, a beautiful, young actress.
This left said “first lady,” Valerie Treirweiler, otherwise known as the “Rottweiler,” so shaken and humiliated that she had to be checked into a hospital for “sleep therapy” where she still was as of yesterday.
The voters would be appalled in the US. The tabloids in Britain would go mad. The electorate in Germany would be dumbfounded. But in France no one seems to care.
And that is why we are preparing a bid to become the next president of France. If the presidency of France can turn François Hollande into an attractive man, it must be the most powerful aphrodisiac ever found.
True, the next election is not for a couple years. And true, too, that we will probably not get a place on the ballot. But we will count on you, dear reader. We will expect your “write in” vote to put us over the top.
Confident of your support, we’ll begin saving our money to buy a scooter.
Regards,
Bill
Market Insight:
Time to Invest in Palladium?
From the desk of Chris Hunter, Editor-in-Chief, Bonner & Partners
Here’s a chart I showed members of Bonner & Partners Family Office this morning…
It tracks the weekly spot price of palladium going back six years.
As you can see palladium prices have been in a long-developing consolidation pattern over the past couple of years.
Think of this as a period of indecision – investors aren’t sure where palladium prices are going.
Thing is, these periods of consolidation don’t last forever. Sooner or later, prices will breakout of their restrictive barriers (blue sloping lines on the chart).
I expect the breakout will be to the upside.
That’s because the supply and demand picture for palladium is setting up for a big push higher in prices.
Palladium is used all over the world in catalytic converters. And with global auto sales growing – particularly in the emerging world – demand for palladium will grow, too.
On the supply side, low levels of palladium inventories in the hands of those that need it… coupled with a new spate of strikes in South Africa (where much of the world’s palladium supply is mined) point toward a big supply squeeze.
Keep an eye on the 750 level of resistance on the chart above. I expect palladium prices to breakout above this level soon.
Our advice: When they do, add some exposure to this key strategic metal. If we see anything close to the 2009-11 bull run, you’ll be richly rewarded.
[Ed. note: We are opening up membership of Bonner & Partners Family Office to Diary readers. If you are interested in learning more about long-term trends like these, you can fill out this Declaration of Interest form here. We will then add your name to a special circulation “priority list” to receive a personal invitation from Bill to become a member of his group.]
