Abandon Hope, All Ye Who Enter Here
"Opening the Gates of Hell"
by Bill Bonner
"Some things are possible. Some are impossible.
And some are just stupid."
– Bill Bonner
WEST RIVER, MARYLAND – "Somewhere in this once-great nation, a real revolutionary – young, angry, determined, and smart – practices before the mirror… searching for the right pose… looking for the right words…to express the outrage of those left behind, forgotten, dissed, and used by a corrupt elite. And sometime in the future, his hour come ’round at last, this Lenin will slouch towards Washington…But the feds… the elite… the Deep State… will be ready for him. They’ll just shut down his Facebook account!
More Stimulus: Today, we look at how distant dots connect. MarketWatch signals that more stimulus is coming: "Already spent your $600 stimulus check? Another one may soon be on its way."
The amazing thing about this “relief” program is that it already surpasses the actual damage caused in the U.S. by the coronavirus lockdowns – by as much as 10 times! The loss of GDP caused by the COVID-19 shutdowns and associated recession is said to be about 3%… or less than $600 billion. The stimulus used by the feds to offset the losses, however, has already toted to some $2 trillion for the CARES Act… and about $3 trillion in additional Federal Reserve money-printing. (There is considerable overlap in those numbers… and it’s hard to pin down the exact cost. Director of the National Economic Council Larry Kudlow said the total was $6 trillion.)
So, you have to ask yourself… how is this possible?
Something for Nothing: A woman goes to the hospital to have her appendix removed. The surgeon takes out her appendix. But then, in the spirit of generosity, he takes out her gallbladder, her left lung, and a kidney, too. You take your daughter to the pet store to buy a puppy. You come home with a puppy, a kitten, a hamster, and a boa constrictor. And now… thanks to the new Democrat leadership in Congress… they’re going to give you a pet jackass, too.
Says Joe Biden: "The debate over $2,000 isn’t some abstract debate in Washington. It’s about real lives, your lives. If you’re like millions of Americans all across this country, you need the money, you need the help, and you need it now."
Never Better: Remarkably, for a Plague Year, most American households and businesses don’t need the money more than ever before. Average family finances were never better. Americans made about $1 trillion more in 2020 than in the year before. People without jobs got state unemployment… and then a supplement from the federal government. Many ended up with more money than they made when they were on the job. Some got twice as much.
Those still collecting paychecks did well, too. Gone was the cost of commuting to work, including gas and parking fees. No more lunches at the diner. No more going out to restaurants, either. Or to the movies. Or on vacation. The cost of living, generally, went down… while income remained steady.
Pernicious Rot: To add to the financial comfort of America’s households, the Fed continued to push down interest rates. Overall, the typical family may have saved as much as $2,000 during the year… thanks to the lower borrowing costs. Mortgage interest rates, for example, fell a full 100 basis points, from 3.5% in January 2020 to barely 2.5% today. On a $200,000 mortgage, that’s a saving of about $108 per month. And recently, some companies advertised 30-year mortgages at only 2.3%.
And here, the pernicious rot sets in. The person who could previously only afford a $300,000 house is now shopping for bigger digs. And the builders are cranked up to provide it. They use up real resources – labor… copper… fuel… wood… and don’t forget the marble countertops! – building houses for people who can’t really afford them. And then, when interest rates rise… what will happen? At “normal” rates, the fellow could only afford half of the house. If rates go much higher, he won’t even be able to afford the basement. Who will take the loss? The homeowner? The mortgage finance company? Nobody?
Why Stop There? Once an economy depends on printing-press money, it is doomed. Like gangrene, the counterfeit money rots one sector after another. Yes, it could be stopped. But who wants to cut off his own hand? And today, all across the country, nostrils flare at the faint odor of another $2,000 in federal giveaways headed their way.
Only a few years ago, they would have thought it impossible. Where would the money come from? Why would the feds give it away? Aren’t they already running a deficit? The CollaborativeHouse.com explains: "People love money. And once a new kind of stimulus money is tasted it becomes a permanent feature of how every subsequent downturn is handled."
In 1930, Treasury Secretary Andrew Mellon said, “Liquidate labor, liquidate stocks, liquidate real estate. Purge the rottenness out of the system.” In 2020, Treasury Secretary Steve Mnuchin said, “We have a lot of money. We need to get that money in Americans’ hands.”
And if the feds have so much money… why stop there? Why should we pay rents and mortgages? Surely the feds can make them go away? Why do we pay for college tuition? Why do we pay medical costs? Why do we have to work? Why don’t the feds give us a permanent stimulus… a Universal Basic Income (UBI)?
Nothing Is Impossible: History will show that it was not just the gates of the Capitol that were breached in 2021. More important, the gates in front of the “impossible” were thrown open. Now, people take for granted what they used to take for absurd.
Why should we honor the Constitution? It was written more than two centuries ago. And why should we protect private property? Is it fair that some have so much and others so little? And how come one man gets a pretty, young wife, while others suffer with old crones?
Now, a better world is possible… finally correcting the injustices, unfairnesses, and bad luck of the past. And from now on, we will all speak Swedish and wear our underwear on the outside so our rulers can see that it is clean. Once the vanguard has stormed into impossibility, a real revolution cannot be far behind."
