Squandermania!

[Bill Bonner’s Diary]( Squandermania! By Bill Bonner Tuesday, November 23, 2021 [Bill Bonner] BALTIMORE, MARYLAND – Who are these guys? We’re talking about the “12 Nobel Prize-winners” [we mentioned yesterday]( who supposedly (according to Senator Mazie Hirono of Hawaii) believe more government spending will reduce inflation. What’s the theory? How does that work? When, where, how has it worked in the past? We’ll look at those Nobelistas in a moment. But first, this morning’s big story. The Boston Globe: Biden crosses liberals to renominate Powell as Fed chairman, keeping a crisis-tested veteran to tackle inflation Senator Elizabeth Warren and several other high-profile Democrats publicly opposed giving Powell four more years as chairman of the central bank’s board of governors, but President Biden chose to nominate him anyway. Crisis-tested? The big test came in 2020, when the feds tried to replace real output with fake money. It was a foolish program, now being paid for in higher consumer prices. And Powell was right there, every step of the way. Yes, he was “crisis-tested.” And he failed. So, let’s now turn to the geniuses – the Nobel winners. Recommended Link [Dangerous Times Ahead…]( [image]( Our world is staring down what may be the worst supply chain crisis in human history. And it’s not something that will just “go away” in a matter of weeks. The previous shortages we saw in 2020 will be nothing compared to what is to come. Bloomberg calls it “Supply Chain Hell.” NPR calls it “Industrial Hell.” The New York Times calls it a “Disaster.” And the true culprit behind this new crisis may surprise you. [Click here to learn what’s causing all this – and how to prepare for what’s coming next](. -- Total Failures The first thing we notice is that it wasn’t just a dozen. There were 17 of them, guided by the lead-dog, Joseph Stiglitz. The September 20 Economic Policy Institute headline reads: Seventeen winners of the Nobel Prize in economics sign letter in support of the President’s Build Back Better package Ok… And here’s Stiglitz explaining why this isn’t going to be like every other federal boondoggle program: The President’s economic agenda, the “Build Back Better” package being debated in Congress, would provide vital public investments in the nation’s physical and human infrastructure, as well as in our tattered safety net. These investments are long overdue – they were needed before the COVID-19 pandemic, and their necessity has been highlighted by the virus and the economic shock that came with it. Here at the Diary, we’ve [searched in vain]( for an example of a federal “investment” – in recent history – that has paid off. As near as we can tell, World War II and the interstate highway system were the feds’ last successful programs… And even as to them, we have our doubts. [Featured: Retired yet? You can be, just watch this]( Then came the Vietnam War (1955), the War on Poverty (1964), the War on Drugs (1971), Amtrak (1971), the War on Terror (2001), the War on Afghanistan (2001), the War on Iraq (2003)… We remind readers that U.S. debt increased from $5.6 trillion to nearly $29 trillion between 1999 and 2021. That extra $23 trillion, invested by the federal government, was supposed to make us richer, not poorer. And if those marvelous “investments” – the War on Terror… bailing out Wall Street, etc. – had worked, they would have paid dividends, allowing us to pay down our debt. Instead, the “investments” were total failures… GDP growth rates slowed… and the debt grows bigger and bigger. We also remind readers that when you pay for your “investments” with printing-press money, the most likely consequence is higher prices – which is really just a devious tax on consumers. It takes money from consumers tomorrow so that money can be stuffed down ratholes today. 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First, these spending programs will increase output… Stiglitz: These are importantly supply side measures, increasing the ability of more Americans to participate productively in the economy, helping to improve our low employment-working age population ratio. Significantly reducing the fraction of children growing up in poverty and giving these children access to pre-K and college education will reap large dividends in years to come. This is such a silly argument that we scarcely deign to reply. There are only so many hours… so much savings… so many workers… so many skills… so many resources available. The question is: Who decides what happens to them? Either people decide for themselves… or the feds make the decisions for them. But there is no evidence, anywhere, anytime, anywhichway that when the feds spend the public’s money, they do so more efficiently or better. To the contrary, every indication – both empirical as well as theoretical – shows us that the feds are terrible asset allocators. [Featured: Jeff Brown says “This new technology is Ripping through the financial world”]( No Inflationary Threat And won’t this extra spending have to be financed with “printing press money”? And won’t it lead to higher prices… undermining any good that might otherwise come from the spending programs themselves? “No,” says Stiglitz: We need safe school buildings and bridges, and affordable child and elder care, whether inflation is 2% or 5%. With the investments being financed by tax increases, the inflationary impacts will be at most negligible – over the medium term outweighed by the supply side benefits; and their progressivity will help address one of the country’s critical problems, the growing economic divide. The federal government spends far more today on schools – including college loans – than it did in the past. But where are all these better-educated, higher-earning, civic-minded taxpayers? They don’t exist. Nor is the “supply” of goods and services increased by taking money from the people who earned it and giving it to other people. Instead, it is diminished and impaired by perverse incentives and government inefficiency, corruption, and waste. Still, Stiglitz pours on the blah, blah. “Investments.” “Social needs.” “Climate crisis.” And all of this can be accomplished “without presenting an inflationary threat.” Recommended Link [Want to retire rich?]( [image]( Can you imagine investing just $1,000… And within 8 weeks, turning it into a $7,660 profit? Sounds crazy right? But that’s exactly the kind of gains you can see using the “Money Multiplier” technique. And it’s the kind of returns Jeff Clark has been generating throughout his 24 year career as a money manager where he ran a $200 million money management firm… Today he wants to share it with you. Watch [this urgent bulletin]( to find out how you can start to profit in a matter of weeks. [Show me the way!]( -- No Winner In what world does this happen? Where can you take money away from people… spend it on your pet projects… and everyone comes out ahead? Where can you “print” money and not cause inflation? How can the feds undertake a [$5 trillion]( Build Back Better project without squandering most of the money? If they get the money from taxing… there is no net gain. Some people win. Most people lose. If they get the money from the “printing press,” the tab is eventually paid by consumers – in the form of higher prices. And either way… real wealth is squandered. Regards, [signature] Bill --------------------------------------------------------------- Like what you’re reading? Send your thoughts to [feedback@rogueeconomics.com](mailto:feedback@rogueeconomics.com?subject=Squandermania!). --------------------------------------------------------------- FEATURED READS [The Newest Technological Trend Moves Away From Big Tech]( you follow the news at all, you’ve likely heard of a new term called the “Metaverse.” In simple terms, it’s a newer kind of internet. And according to Legacy Research editor Chris Lowe, it’s out of Big Tech’s control… [Rising Fuel Prices Increase Demand for Firewood]( are buying more firewood as cooler weather begins and many are worried because prices are rising. Why are firewood prices increasing? It takes diesel fuel to produce, so prices naturally follow the cost of oil… MAILBAG Dear readers have a lot to say about [Bill’s essay]( regarding Biden’s new “infrastructure” bill, and what that means for national debt and inflation… I believe the Democratic party is trying to crash the country! When they accomplish that, they will declare martial law, collect all of the guns, and lock everything down until the emergency is over. The emergency will never be over! In 10 years, just like they promised, you will own nothing, and you will be happy (or else). If you complain about anything they will send some people out to where you live, to adjust your attitude. Most people refuse to believe that what is going on will lead to a permanent change, and they will do nothing until it's too late to do anything. – Don B. I see your point, Bill… the die is cast. Doesn’t matter what they do because the damage is already done. As recently as 2013 the Federal Reserve could have avoided this… but instead kept rates nailed to zero, even after we didn’t “need” them anymore. But it didn’t, so here we are and over the cliff we go. On the other hand… isn’t it possible the elites could realize they have no interest in ruling over a smoldering pile of economic rubble? There are voices even within the Fed beginning to question the orthodoxy. I don’t know… maybe it’s just wishful thinking, but I like to believe the Stockman scenario is at least in play, even if it’s the underdog. – Bill T. Another spot-on review today. I wish I had your command of the English language… and your insights into the problems of big government and world improvers. – Lawrence K. And more comments coming in on Bill’s essays on [climate change]( and [the COVID-19 panic]( As a deeply religious person I would like to point out the hypocrisy of some of your dear readers. Several recent comments have declared that God would not give humankind the ability to alter the world's climate. Excuse me? Open your eyes and get your heads out of your anal orifices! Humans have slashed and burned the Amazon rainforest to the point where scientists have now declared it to be “lost.” It can never recover from Man’s depredations. The world’s rivers are poisoned with sewage and chemical wastes… The oceans are choked with plastic… The atmosphere is so polluted that there is no longer any such thing as “fresh air” anywhere on Planet Earth… And your dear readers are so senseless as to believe that humans have no ability to affect the climate? – Dale A. All this ruckus about the virus and climate (and all the other stupid stuff going on in the world) just causes unrest and we know where that leads. The answer is in front of our faces. We just have to open our eyes to see. Remember, I am an old optimistic conservative. – Don H. For the record, the climate is changing, but my number one concern related to environmental catastrophe is plastics and microplastics. Plastics do not break down into natural elements, they just break down into smaller and smaller pieces of plastic. And now these unnatural substances have been found all over the Earth, polluting from the bottom of the deepest ocean trench to the top of the tallest mountain. These plastics have been ingested by all sorts of animals, including humans. No one knows what impact these plastic particles will have on the environment and all of the life that ingests them. – Marvin W. With regard to the statement about taking the “vaccine,” who is to say what risks are “reasonable,” and what on Earth makes him believe that people taking the shot are doing so to protect him, rather than because they believe it will protect themselves? These are particularly relevant questions when we find that the so-called vaccines do not prevent infection with or transmission of the Covid-19 virus, and in fact, may predispose the “vaccinated” to greater harm when they are infected (and in some cases, re-infected) with the virus. – Sheryl P. Are religious dear readers hypocritical by saying they can’t alter the world’s climate? Will most people wait until it’s too late to believe the climate is in danger? Write us at [feedback@rogueeconomics.com](mailto:feedback@rogueeconomics.com?subject=Squandermania!). IN CASE YOU MISSED IT… [Do You Know About “Tech Royalty” Savings Accounts?]( If you don’t know about “Tech Royalties” — it’s time you find out… This is a new kind of asset that lets you earn 8%… 12%… even 17% — or more — on your savings. Compare that to the measly .06% you get from a regular bank. Not surprisingly, banking insiders are quietly moving their own money into “Tech Royalties” ahead of a major event. And JPMorgan — the biggest bank on Wall Street — predicts payouts from “Tech Royalties” will hit $40 billion by 2025. That money is just sitting there waiting for someone to collect it. [Click here to learn about “Tech Royalties” before this big catalyst makes “Tech Royalties” a mainstream investment.]( [image]( --------------------------------------------------------------- Get Instant Access Click to read these free reports and automatically sign up for daily research. [image]( [An Insider’s Guide to Making a Fortune from Small Tech Stocks]( [image]( [The Gold Investor’s Guide]( [image]( [The Trader’s Guide to Technical Analysis]( [Rogue Economincs]( Rogue Economics 55 NE 5th Avenue, Delray Beach, FL 33483 [www.rogueeconomics.com]( [Share]( [FACEBOOK]( [Tweet]( [TWITTER]( To ensure our emails continue reaching your inbox, please [add our email address]( to your address book. This editorial email containing advertisements was sent to {EMAIL} because you subscribed to this service. To stop receiving these emails, click [here](. Rogue Economics welcomes your feedback and questions. But please note: The law prohibits us from giving personalized advice. 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