What Milton Friedman did to capitalism

[Bill Bonner’s Diary]( What Milton Friedman Did to Capitalism By Bill Bonner Wednesday, December 9, 2020 [Bill Bonner] WEST RIVER, MARYLAND – Recently, The New York Times opened up with alarming news: The Rich Kids Who Want to Tear Down Capitalism Lately, Sam Jacobs has had a lot of conversations with his family’s lawyers. He’s trying to gain access to more of his $30 million trust fund. At 25, he’s hit the age when many heirs can blow their money on harebrained businesses or a stable of sports cars. He doesn’t want to do that, but by wealth management standards, his plan is just as bad. He wants to give it all away. “I want to build a world where someone like me, a young person who controls tens of millions of dollars, is impossible,” he said. A socialist since college, Jacobs sees his family’s “extreme, plutocratic wealth” as both a moral and economic failure. He wants to put his inheritance toward ending capitalism… For what it is worth, we agree with Mr. Jacobs. It would be a better world if lamebrains like him never had control over large amounts of money. A warning to parents! But all parents die. And their wealth goes to someone else. Under “capitalism” – a “system” developed by trial and error over many centuries – even morons occasionally end up with a lot of money. But capitalism insists that fools and their money be soon separated. So relax, Mr. Jacobs. No major overhaul is necessary. “Capitalism” will give you not necessarily what you want, but at least what you deserve. Recommended Link [TONIGHT: Jeff Brown Reveals The #1 Private Biotech for 2021]( [image]( The man who picked the #1 stock in the S&P 500 three out of the past four years… Is stepping forward to share details of his #1 private biotech of 2021 for free. It all happens tonight at 8 p.m. ET during “[The Cure Event]( [CLICK HERE TO RSVP NOW]( -- Facts! And what’s the alternative? Something more “scientific,” perhaps? This week, we are exploring the fallibility of science. To bring new readers into the picture, basing public policy on “the science” is asking for trouble. Science is not only fallible; it quickly becomes another tool for the elite to rob the common man. Today’s elites went to the best schools and pretend to have access to “the science.” They will tolerate no doubts. Mr. Jacobs knows for a fact that it is wrong for some people to have a lot more money than others. He also probably knows all about the “patriarchy” and how it exploited and oppressed people of color for centuries. He must be enlightened on environmental science, too; he knows the planet is in danger, and he must save it. And what he doesn’t know about gender… unequal pay… and politically correct pronouns… is, well, not worth knowing. As we’ve seen, the elites use this conceit of knowledge to silence critics of their anti-COVID policies… their Global Warming hypothesis… their wars on poverty and drugs… and their faddish “social” science doctrines – diversity, racism, equality, and so on – always claiming that there is some “proof” that these things are not just opinions… they are “facts!” [What is the “1170” Investment Account?]( Natural Elites And Mr. Jacobs brings us to our own little corner of the loopy world – money. And first, we note that money is not only what makes the nag run, it’s what keeps her from making a fool of herself. Money limits as well as enables. There are always some people who are smarter, faster, more ambitious – a natural elite. Government attracts them like rich widows attract gigolos. But what holds them back? What keeps them in check? It’s money. Real wealth is created by real people, who furnish goods and services to each other. It’s limited. In modern societies, the elites can get money by taxing or borrowing. But they run into limits very quickly. Tax too much, and the voters toss you out. Borrow too much, and interest rates rise, “crowding out” the private borrowing needed to produce goods and services. In either case, until 1971, if the ruling class wanted more money, it had to go to the people’s representatives – in Congress. Back then, it was clearly the people’s money, and if the politicians wanted more of it, they had to have a good reason. Naturally, the people – or their representatives – were skeptical. They asked questions. “Do we really need another war in the Middle East?” “Do those anti-poverty programs really work?” “We’re not sure we even want to go to Mars.” That was the crucial link between the people and the government – the power of the purse – that restrained elite power. Recommended Link [[On the Record] Silicon Valley Insider’s Dark Confession]( [image]( Jeff Brown is a former executive for companies like Qualcomm and NXP Semiconductors. He’s a successful angel investor with a stake in dozens of tech startups. And he has degrees and professional certificates from institutions like Stanford, Yale, MIT, and London Business School. Jeff has devoted his life to technology… And today, he’s making a confession… “The game is rigged against you…” he says. “Tech investing is an insider’s game…” Jeff says there are new technologies on the verge of huge breakthroughs… And the general public has no idea. You likely won’t find out until years later. Long after the big money has been made on the stock market. [Today, Jeff is going to give you a rare opportunity…]( A chance to get in on 3 explosive new technologies — right alongside the insiders. Before the potentially big move up. [Click here to find out what Silicon Valley experts are buying right now]( -- Tearing Down Capitalism That link was broken in the name of a new economic science – monetarism. In the twentieth century, American economist Milton Friedman believed he had “cracked the code” of inflation. It was “always and everywhere” a monetary problem. And it could be eliminated, or so he thought, by controlling the money supply predictably and tightly. Friedman proposed removing the gold backing from the U.S. dollar and replacing it with the good intentions and scientific rigor of the Federal Reserve. The Fed was supposed to increase the money supply by 3% – no more, no less – each year, roughly equivalent to the rate of GDP growth. Problem solved! Of course, the problem was not solved at all. It got worse – with the inflation rate rising to 14% in 1980. [Viral: 1.3 Million Folks have Already Seen This Message.]( Former Fed chair Paul Volcker brought inflation under control – for a while. Then, as debt rose and more crises came along, the feds forgot all about Milton Friedman’s 3% per year rate. In 2008, the U.S. “monetary base” was only $860 billion. Seven years later, it was over $4 trillion. That’s an increase of over 350% in seven years. And today, the Fed is “printing” $30 billion of new money every week, adding to the money supply 10 times as fast as Friedman recommended. Recommended Link [Stunning money experiment goes viral]( See this pile of cash here? [image]( It’s all $1 bills… Can you guess how much money is in this pile? [Click here to find out]( -- Fundamental Change And now, with the power to print as much of this new money as they want, the elites no longer need the permission of the people they are meant to serve. Whatever cockamamie, reckless, and imbecilic thing they want to do – usually backed by some quack science – they can get the money to pay for it. This change is fundamental… and fatal. It is what has allowed the elites to run wild – enriching themselves at the public’s expense… ...funding foolish wars and jackass social programs… ...and burying the U.S. economy – along with its households, businesses, and the government itself – under a mountain of unpayable debt. And poor Milton Friedman. Unwittingly, the champion of capitalism probably did more damage to free markets and to the U.S. government than any of the dim socialists of his era. Stay tuned… Regards, [signature] Bill --------------------------------------------------------------- Like what you’re reading? Send your thoughts to [feedback@rogueeconomics.com](mailto:feedback@rogueeconomics.com?subject=What Milton Friedman Did to Capitalism). --------------------------------------------------------------- FEATURED READS [America May Have to Wait Longer Than Expected for Pfizer’s COVID-19 Vaccine]( the FDA approves Pfizer and BioNTech’s COVID-19 vaccine for widespread use in the U.S., distribution will likely take longer than Operation Warp Speed’s original 48-hour promise. So, what’s the new timeline? [Put Your Money in Gold This Decade]( Research founder Doug Casey agrees with Bill, Dan Denning, and Tom Dyson: It’s a good time to invest in gold. If you invest in anything over the next 10 years, says Doug, make it the yellow metal. Why? [Read on]( for his take… MAILBAG On Friday, Bill said [Tesla is overvalued](. One dear reader blames Elon Musk… Elon Musk is a visionary. A businessman, however, he is not. He makes a great car but runs a lousy business. He makes money for himself by syphoning money out of the taxpayers’ pockets via government programs and swindles, but has never made a single dime for the people who actually own the company – the shareholders. If Elon were enough of a businessman to recognize that he is not a businessman, he would step aside and let a businessman become CEO and try to make something solid out of that company. But, like the U.S. government, the company is so deep in debt, and so insanely overvalued, that any turn toward becoming a viable company will cause a stock price correction that will do too much damage to Mr. Musk’s pocketbook. And so he will keep the scam going. – Joseph J. Meanwhile, two dear readers chime in on Bill’s claim that [science is “]( ever figured out”]( The one thing that should be known is that science is the pathway to the truth. We may or may not be halfway there in our search for the truth. In our pursuit for the truth, we need to understand that our physiology from person to person varies considerably. So with each case, we realize that the truth may be unattainable. We need to reference back to the early scientists and start again to see what we have missed. Science and money have become eager partners. We need to question if that is good or bad. I look back to the days of Jonas Salk and his relationship trying to conquer polio. He was dealing with this enigma with one-tenth of the technological capabilities that we have today. So what are we missing between then and now? Maybe reverse engineering can be part of what is missing in our search. We need to know what we can accomplish by retooling the process by looking backward before we look forward. – Terry B. Reminds me of the saying (don’t know who said it or when): “Science has proof without any certainty; religion has certainty without any proof.” Draw your own conclusions. – Steve L. Could the world’s early scientists help fill in today’s knowledge gaps? Is science another tool for the elite’s rise to power? Write us at feedback@rogueeconomics.com. IN CASE YOU MISSED IT… [Forget Google, Facebook, Amazon, and Tesla…You Just Need This One Ticker]( Could you make enough money to retire trading only one ticker? Sounds crazy… But legendary hedge fund manager Larry Benedict has made millions for himself and his clients trading only one ticker. And no, it’s not Google, Facebook, Amazon, Tesla… or any company you might have heard of before. And now he’s ready to reveal this secret in a brand-new free presentation this Friday at 10 a.m. ET. [Click here to sign up and Larry will even give you the ticker during the event… no strings attached…]( [image]( --------------------------------------------------------------- Get Instant Access Click to read these free reports and automatically sign up for daily research. 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