“Doug warns that today’s Republicans are just as reckless as the Democrats they pretend to oppose.
“The only difference?
“Who gets the pork.
The national debt is nowwell over $37 trillion.
Washington is borrowing over $6 billion per day—just to keep the lights on.
And with interest payments alone topping $1 trillion annually, there’s only one path forward:
Print. More. Money.
That means the purchasing power of the US dollar—the value stored in your retirement, savings, or brokerage account—is being systematically destroyed.
If you’ve felt like things are getting more expensive, faster than ever… It’s not your imagination.
It’s by design.
When the government can’t pay its bills, it prints money to cover the difference.
We’re Witnessing the Final Stage of Fiscal Insanity
Legendary speculator Doug Casey has seen this playbook before.
He’s called nearly every major economic upheaval of the past five decades—from the collapse of the Soviet Union to the 2008 crisis… and now, he warns, we’re entering what he calls the “financial eschaton”—the endgame.
Trump’s so-called “Big Beautiful Bill” is nothing more than another trillion-dollar catastrophe, indistinguishable from Biden’s “Build Back Better” in all but rhetoric.
The bottom line of this bill is that it directs a lot more power and dollars toward the State—and in no way cuts it back.
It’s not just irresponsible spending.
It’s a strategic transfer of wealth—from everyday Americans who are already being crushed by inflation, to the politically connected institutions that own the debt.
If there were any honesty left in the system, we wouldn’t inflate our way out of this debt crisis—we’d default on it directly.
Because make no mistake: a default is coming. The only question is whether it will be:
Honest (a hard reset, where creditors are left holding the bag)…
Or dishonest (where your savings are destroyed through currency devaluation and stealth inflation).
And Trump’s bill—which includes $1 trillion in defense spending, a bloated Department of Agriculture, and new “Trump Accounts” for kids—only accelerates the decay.
What our ruling class really means is that they want to continue making all of the rules. They have no moral high ground to claim, so a vague appeal to some kind of shared moral principles must suffice. In short, the “rules-based world order” is nothing more than a moral appeal to keep the same people in charge of everything.
The “free world” is a troublesome slogan, as basic freedoms have become a radical concept in the year 2022. The western ruling class, which used to defend the idea of unalienable rights, has decided that such a term carries too many troublesome connotations regarding the unalienable rights of you, the members of the pleb class. So it’s time for a rebrand, and the deployment of some new rhetoric to protect the elites sitting atop the global hierarchy.
In demonstrating their supposed moral superiority, our ruling class is now coalescing behind what they refer to as the “rules-based” world order.
This “rules-based world order,” a bumper sticker slogan that has united the rulers of the Anglosphere, EU and NATO powers against their foreign and domestic enemies, is easy to define, once you understand what they mean by the word “rules.”
This barb is being deployed repeatedly at the Russian government (and the Chinese government in reference to trade policy), in condemning its invasion of Ukraine as violating the modern construction that is the liberal international order, or the illusion of “Pax Americana,” or better yet, the “rules” of territorial sovereignty established after World War II.
Of course, these rules are necessarily malleable, as our rulers have spent the last decades justifying their routine invasions of foreign nations under the banner of democracy, freedom, and the like.
Biden’s “Build Back Better” efforts have been a phenomenal failure so far, but maybe that’s because Americans just don’t understand a good thing when they see it?
This has been Biden’s argument on the state of the economy lately, as he persistently argues that there is no threat of recession because the US jobs market still “strong.” There is no mention from the White House regarding the fact that covid stimulus spending artificially drove up retail demand and created a temporary spike in jobs. If they were to admit that layoffs are about to ramp up because the covid checks are gone and people’s credit cards are maxed out because of inflation, then Biden would have nothing left to brag about.
Biden economic adviser Cecilia Rouse responded to media question on the inflation situation in particular this week and offered even more propaganda, rather than an honest assessment of the dangers ahead. Remember, this is the same administration that was still saying only a year ago that inflation was “transitory” despite all evidence to the contrary. Yet, we’re now supposed to trust their opinions on the potential for recession and solving inflation?
One of the key obstacles to “Build Back Better” is the reality of high inflation. If Biden gets what he wants, which is at bottom an infrastructure renewal plan similar to the New Deal plan under FDR during the Great Depression. Whether or not the New Deal actually saved the US economy is up for debate (the destruction caused by WWII left the US as one of the only major manufacturing nations still intact, and this was the main reason for the explosion in wealth and the national escape from poverty), but even if it made a difference the circumstances today are not the same.
The problem is that FDR was facing a deflationary crash in which the US dollar remained viable and strong. Today, we are dealing with a stagflationary crash in which price inflation is rampant and the dollar’s buying power is growing ever weaker. One of the main reasons for this inflation is due to government spending and massive Federal Reserve stimulus created from thin air.
Update (1515ET): Manchin on Monday laid out possible changes to the $2 trillion Build Back Better economic agenda which might encourage him to reverse his “no” on the legislation.For starters, Manchin said he would only support a $1.75 trillion bill that seriously overhauls the US tax code, and that significantly lowers the cost of a broader array of prescription drugs vs. the current offering.”If you’re going to negotiate then negotiate. Don’t start picking and choosing and playing games,” he said.
He also wants work requirements for benefits, such as expanded child tax credits, as well as a means test which would cut off people making over $200,000 per y ear.
Manchin’s vision for the child tax credit is at odds with Biden’s pledge to not raise taxes on those earning less than $400,000. Manchin suggested scaling back the tax benefit for those earning between $200,000 and $400,000. He said he didn’t believe that parents who didn’t earn any income should be able to get the credit, a revision that would reverse a change Democrats made to the benefit earlier this year.Even if those changes are made, Manchin indicated he has other issues with the bill and how its been pushed through Congress. –Bloomberg
The West Virginia moderate also said he wants the bill to be run through several Senate committees that would examine its effects, and he’s also rejected attempts to fast-track “major policy changes” that would bypass the GOP filibuster.* * *Update (1034ET): Sen. Joe Manchin said during a local radio interview that Joe Biden’s staff did some ‘inexcusable’ things which drove him to reject the Build Back Better plan.
On statewide WV radio, explaining his decision to buck BBB, Manchin says Biden staffers alienated him. “They drove some things, and they put some things out that were absolutely inexcusable. They know what it is, and that’s it,” he says on @HoppyKercheval‘s MetroNews program.
Manchin takes a shot at WH staff. “This is not the president — this is staff.. They drove some things that are absolutely in excusable.” “I just got to the wit’s end of what happened.” He won’t say if he’ll accept scaled-back bill. Says it needs to go through committees first
“They figured surely to God we can move one person. We surely can badger and beat one person up. Surely we can get enough protesters to make that person uncomfortable enough that they’ll just say, ‘OK I’ll vote for anything,'” Manchin continued. “Well, guess what? I’m from West Virginia. I’m not from where they’re from and they can just beat the living crap out of people and think they’ll be submissive, period.”* * *Progressive Democrats are livid at moderate Sen. Joe Manchin (D-WV) for killing the Biden administration’s $2 trillion Build Back Better plan over the weekend.“Our entire democracy is on the line,” tweeted congresswoman Alexandria Ocasio-Cortez on Sunday. “We, as always, are here to fight for this agenda. What matters most to us is that it gets done,” she added. “But we cannot just shrug our shoulders and accept this as some Charlie Brown moment.””So we need to get back in there and get this s*** done. Period.”
Elon Musk didn’t have a care in the world last week as he hilariously mocked questions in a live interview with the Wall Street Journal.
The Journal’s reporter had essentially prepared a number of softball questions designed for Elon to praise the US government’s new ‘Build Back Better’ bill.
If you haven’t heard, the legislation contains a number of provisions which should greatly benefit Tesla, including major subsidies to build electric vehicle charging stations across the US.
But Elon had no interest in the puff piece.
“Unnecessary,” he interjected when the reporter started to ask what he thought of the subsidies.
“Do we need support for gas stations? We don’t. So there’s no need for support for a charging network. I’d delete it. Delete.”
This left the reporter flummoxed… how could Elon possibly not be excited about “free” government money that would support his business?
But Elon’s point seemed completely lost on her.
“Seriously we shouldn’t pass it,” Elon continued, almost exasperated.
“If we don’t cut government spending, something really bad is going to happen. This is crazy. Our spending is so far in excess of revenue its insane. You could zero out all billionaires in the country… you still wouldn’t solve the deficit.”
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So the reporter said, well, let’s change the subject.
Elon then sounded-off on issues like the rise of China and corresponding decline of the US. He also called declining birth rates “one of the biggest risks to civilization.”
Now, Elon Musk is a famously eccentric character.
But another more ‘traditional’ billionaire is also on board with this ethos.
Ray Dalio founded and runs the largest hedge fund in the world, Bridgewater Associates.
He has been very vocal over the past several years about the pathetic state of US government finances, and obvious shift of wealth and power away from the US.
Dalio points out that, buying US Treasury bonds (which is tantamount to loaning money to the federal government) USED TO BE a good investment, back when America was actually creditworthy.
But now when you buy bonds, you’re loaning money to the largest debtor that has ever existed in the history of the world… and in exchange you are receiving return that is well below the rate of inflation.
Dalio points out that people still value US government bonds because of “the ‘exorbitant privilege’ the US has had being the world’s leading reserve currency, which has allowed the US to overborrow for decades.”
But there are signs of the changing global wealth and power dynamic, as international investors are starting to shift to Chinese bonds.
That’s a major theme in Dalio’s new book, Principles for Dealing with the Changing World Order: Why Nations Succeed and Fail.
Dalio has made it his life’s work to understand debt and political cycles, in order to foresee risks that others miss, and better serve his clients.
He makes a lot of the same assertions that Elon makes; for example, Dalio explains that economies, governments, and civilizations move in cycles. And in simple terms, there are good parts of the cycle, and there are bad parts.
The good part of the cycle is characterized by peace, prosperity, and production. The bad part includes recession, depression, inflation, social conflict, and war.
If you think about US history, we can see that the 1920s were a ‘good’ part of the cycle. The 1930s and 1940s were bad— the Great Depression, World War II, etc.
Then the 1950s and early 1960s were good again. The late 1960s through the early 1980s were bad, marked by extreme social turmoil, geopolitical conflict, and stagflation.
The mid 1990s through the mid 2010s were generally quite good, especially from an economic perspective.
Now we seem to be in transition once again to a bad part of the cycle— social conflict, inflation, geopolitical tensions, and more.
Dalio’s book, which I highly recommend reading, lays out a very clear case of what is happening right now, and why.
His ideas are quite similar to much of what we have been writing about for so long here at Sovereign Man.
And Dalio has suggested some of the same solutions that we’ve discussed in these pages.
First, education is critical: it’s imperative to understand how these cycles work in order to be prepared for what’s coming.
Mindset is also key: There’s no reason to panic. The world is not coming to an end. But it IS changing. Rapidly.
Dalio writes that the transition from the good part of the cycle to the bad part are rarely smooth or peaceful. And they often coincide with a shift of wealth and power.
And the United States, while still strong, is clearly losing its wealth and power thanks to its historical debt, massive deficits, an utter embarrassment in Afghanistan, the rise of Marxism, ridiculous ‘woke’ national priorities, etc.
For these reasons, it makes sense to take rational steps to mitigate these long-term risks.
Investors frequently diversify their portfolios to reduce risk; they spread their assets around different companies, different sectors, and even different asset classes, in order to ensure that they’re not over-exposed to a single set of risks.
Similarly, our approach at Sovereign Man is to diversify your geographic/country risk as well.
Give serious thought to the long-term risks where you live. Will your home country experience social conflict, inflation, capital controls, or war?
The good news is that not all countries are going through the same part of their cycles. By taking a global view, you can avoid the worst of the economic shifts that Elon Musk and Ray Dalio are talking about… and what we’ve been writing about for years at Sovereign Man.
This could mean securing foreign citizenship or residency, to ensure you always have another place to go, just in case you ever need the option.
It could mean using alternative assets like crypto or precious metals as a hedge against inflation. Or investing internationally to reduce exposure to your home currency.
The key idea is— don’t put all of your eggs in one basket… especially when that basket is the largest debtor in world history that’s blindly racing as fast as it can into a fiscal abyss.
PS: Alternative residency or citizenship generally forms the backbone of any robust Plan B. But there are WAY more things to consider. That’s why we created our 31-page Ultimate Plan B report to help you get to grips with this topic, and you can download the full, unabridged report here – 100% FREE.
So why would any sane individual continue investing in this program? Even the New York Times called it a complete failure and “a little bit like prison”.
And yet the Job Corps is set to be the proud beneficiary of $1.5 billion, courtesy of the Build Back Better Act that passed the US House of Representatives on Friday.
LBJ at least got one thing right.
In his original State of the Union address in 1964, he acknowledged that the private sector (NOT the government) had the real power to create jobs, enhance prosperity, and alleviate poverty.
In early January 1964, barely six weeks after the assassination of John F. Kennedy, US President Lyndon Johnson delivered a speech to the American people in which he declared an “unconditional war.”
But he didn’t declare war on Vietnam. Or Cuba. Or the Soviet Union.
Johnson declared war on poverty.
And in his State of the Union address he told his fellow Americans that it would take more than “a single piece of legislation” to eradicate poverty.
So they got to work preparing a series of expensive programs to create jobs, build affordable housing, establish new entitlement programs, and invest in vocational training.
It goes without saying that this spending bonanza kicked off a steep increase in inflation. But more importantly it turns out that most of these programs were utter failures.
One of the best examples is the Job Corps, an initiative established in 1964 to provide free vocational training to young people.
The Job Corps was something of a pet project for Lyndon Johnson; he believed that “one thousand dollars invested in salvaging an unemployable youth today can return $40,000 or more in his lifetime.”
This is a long-standing argument for increased public investment in education.
And yet according to a long-term study of the Job Corps published in 2018 by the agency’s own Inspector General, the program has been a terrible investment for the American taxpayer.
The White House’s official press release announcing the Build Back Better Act (BBB) pitches it as a “PLAN TO REBUILD THE MIDDLE CLASS.” It rhapsodizes about “working families” squeezed by the economy, and reminds voters that “Biden promised to rebuild the backbone of the country — the middle class.”
A cartoon illustrates the sort of person who would benefit from Biden’s Build Back Better programs: “Linda,” a white woman, who works at a manufacturing plant but struggles to raise her son, “Leo.”
One thing the White House’s official press release did not mention is that almost all of the $2 trillion doled out under BBB is expressly designated for Black, Latino, Native American, Asian American, Pacific Islander and non-English speaking individuals. White Americans will get nothing and like it. “Even provisions that don’t explicitly exclude whites, turn out, on closer examination, to exclude whites.”
Over and over again, the bill is written expressly NOT to help the hardworking Linda, apparently because she is white. Here are just a few examples:
— $1 billion to Native American, Alaska Native and Native Hawaiian communities for housing “needs.”
— $500 million for minority-serving schools of medicine.
— $112 million for teacher preparation programs at Historically Black Colleges and Universities (HBCUs) and Minority Serving Institutions (MSIs).
— $75 million for culturally appropriate care management and services for older individuals who are racial and ethnic minorities or are underserved due to sexual orientation or gender identity.
— $75 million to study maternal health for pregnant and postpartum minority individuals.
— $50 million study maternal mortality among minorities.
— $50 million to improve behavioral health outcomes for communities of color with substance abuse.
— $75 million to increase research capacity at minority-serving institutions.
What’s more, “Not even Congress knows what the bill would accomplish, with the contents of the plan changing day-by-day as Democrats squabble over how much it should spend, who it should benefit and who should pay for it.”
While Congressional Democrats spar over the ultimate size of President Biden’s “Build Back Better” economic plan, Bloomberg astutely points out that Americans have no clue what they’re signing up for with their tax dollars. In fact, according to a CBS News poll published Oct. 10, just 10% of Americans say they know the specifics of the bill, while only 1/3 think it would benefit them directly.What’s more, “Not even Congress knows what the bill would accomplish, with the contents of the plan changing day-by-day as Democrats squabble over how much it should spend, who it should benefit and who should pay for it.”
For example, on Tuesday, the White House suggested it would jettison free community college. The next day, Democrats were focused on proposed tax hikes after moderate Sen. Kyrsten Sinema (D-AZ) put her foot down over corporate and personal tax rates.In an attempt to provide some clarity (don’t hold your breath), Biden on Thursday night held a CNN town hall-style event (on the same night as Dune’s US release).In short, their messaging sucks.”I will state the obvious, but they need to shift the focus away from process to policy. So far, the coverage around their proposal is all around Democratic divisions, which inevitably makes it impossible to sell,” said former Marco Rubio communications director, Alex Conant. “Frankly, they need to talk about what their goals are,” he added. “Why is this necessary?”Republicans, on the other hand, are clear on their messaging; “Massive government spending leads to massive tax hikes,” according to GOP strategist Ron Bonjean. “When you have a shifting number and shifting programs, it becomes confusing to follow.”
Instead of focusing on the legislation’s new investments in child care, the elderly, education, healthcare and climate change, Democratic lawmakers have openly haggled over the price tag. A standoff between the party’s progressive and centrist factions has created cable news-ready drama.“Given how much is wrapped up in this package, it was always going to be a long and intense negotiation,” said Ben LaBolt, a former spokesperson for President Barack Obama. “One way to start is to build the case for the way this will help middle class families and focus the public on those conversations, while at the same time preserving room for the closed-door negotiations to bring all of the elements of the party together for the biggest, most comprehensive approach possible.” -Bloomberg
In a Wednesday speech in Scranton, PA, Biden tried – and failed – to convey how his economic agenda would help working class families – by intermingling stories about growing up in the area and programs contained in the legislation.”Frankly, they’re about more than giving working families a break; they’re about positioning our country to compete in the long haul,” said Biden, doing his usual poor job of reading a teleprompter. “Economists left, right, and center agree.”Meanwhile, Biden – let’s face it, Biden’s ‘advisers’ have failed to ink a final compromise between warring factions of Democrats. For the Build Back Better plan to pass, every single Senate Democrat must be on board. As moderates Sinema and Joe Manchin (D-WV) balk on the price tag and demanding deep cuts, progressive House Democrats are sure to similarly balk at passing the smaller, $1.2 trillion infrastructure package that’s already passed the Senate.
While advocacy groups have started to spend heavily to promote policies in the plan, most of the discussion remains centered on its cost.Biden’s advisers are banking on the presumption that ordinary Americans don’t pay much attention to the machinations of everyday Washington. Much as they were during the presidential campaign, the president’s aides are largely dismissive of what they call horse-race stories.But Biden’s team had a much easier time selling his pandemic relief legislation, the American Rescue Plan, in March, with its convenient focus on three clear issues — money for vaccines, money to re-open schools and checks sent directly to American households. -Bloomberg
“They haven’t laid out why we need this, other than Democrats are in power now and aren’t going to have it again for a long time,” said Conant.Good luck with that.
by Tyler Durden
MCViewPoint 