‘The mills of the gods grind slowly, but they grind small.’
The year moves ahead. Here in France, leaves are already beginning to dry, curl, and fall to the ground. A gentle breeze shuffles them along, driving them into corners and under bushes.
Last night was cold. We were out at a party in the Limousin region. Slightly higher and hillier than Poitou, we stood outside and felt the cool air falling on our heads. We shivered and reached for sweaters…and then retreated to our cars for the drive home.
Our hypothesis is that the US peaked around the turn of the century.
Since then, as measured in the most reliable money mankind ever discovered, gold, the flower of its industrial wealth, the Dow 30, has been cut in half.
But the phenomenon goes far beyond the stock market or the business cycle.
The American economy has been grotesquely distorted by fake-money financialisation.
So has American society and government been perverted and corrupted by its fake-money-financed elite.
And now, the fading light of late summer falls on an aging, degenerate empire…like a fallen apple, it sits on the ground dreaming of springtime.
Whiff of decay
Yes, we are living in another great Fin de Bubble period; there’s a whiff of decay in the air.
The remaining fruit hangs heavy on the trees…late-summer flowers are at their finest…and as survivors of the Titanic reported, the band never sounded better than just before the ship sank.
The futurists tell us that dying is just a technical problem, soon to be solved by science. But so far, nobody escapes death.
And nobody escapes the justice of markets either…which grind exceedingly slowly, and exceedingly fine.
The Federal Reserve, claptrap economists, the Trump team, and the geniuses on TV tell us that this stock market boom can go on indefinitely…as long as the Fed pushes down on the lever marked ‘Lower Interest Rates and More Growth: Push Here’.
But no bubble has ever dodged its pin forever.
No fake currency has ever survived for more than a few decades.
And no jackass in high office has ever contributed one penny to the real output of any economy.
Unhinged money man
‘Mr Trump has not done a bad job’, began a companion last night. ‘The US economy is doing pretty well, after all’.
The common perception is that Mr Trump may be a bit unhinged, but he’s fundamentally a guy who knows money.
Recall that he was elected to Make America Great Again. The ‘again’ part presumes that it isn’t so great now…and he was right.
By almost every measure, the US has lost ground in the 21st Century, falling in almost every category.
This decline was dismissed by Hillary Clinton, who countered that ‘America is still great’. But the decline was felt in the heartland, particularly by average men.
‘Breadwinner jobs’ in the factories of Gary, Indiana, and Donora, Pennsylvania, were disappearing. Women moved fairly readily into the offices and coffee shops in the big cities. But men were often left out.
Today, there are said to be some 100 million adults without jobs.
Many of them are comfortably retired. But others are simply marginalised, unable to find work in the financialised economy or status in the gluten-free, latte-loving, feminised, politically correct culture of 21st-Century America.
These were the ills — real and imagined — that Mr Trump was elected to fix.
But they are not technical problems. Mr Trump cannot simply push down on the lower-rate lever…or turn the tax-cut knob…
…nor can he go to war with the Chinese, Mexicans, Democrats, the press, or the Fed and expect any significant improvements.
No, America’s problems are self-inflicted. It turned against its own gods — balanced budgets, honest money, and small government. Now, the gods turn against it.
But let’s look at how Mr Trump has done so far. Generally, what we see is an economy that has more or less continued to fumble along as it did during the Obama years.
Final sales numbers (a reliable measure of consumer health) have gone down from the last few months of the Obama era.
The number of jobs added is also lower than it was in the later Obama years.
GDP growth got a temporary boost from the tax cut, but has now fallen back to Obama levels, or lower.
In other words, the economy as a whole has not changed. But the price paid to keep it from changing is higher than ever.
Under Obama, federal spending rose at 2% per year. Now, it is rising at more than 4% per year.
No president since Lyndon Johnson has dared to increase spending so recklessly. And in Johnson’s time, the economy was growing at 4%…or higher. Today, GDP growth is only half that level.
The only way the feds can keep spending so much money now is by borrowing.
Just three weeks ago, Nancy Pelosi and Donald Trump concluded an act of bipartisan treachery — agreeing to do away with the debt ceiling.
Now, the sky’s the limit. And already, the feds are reaching for the stars.
In the last three weeks, the federal government has been borrowing at the rate of $4.5 billion per day.
But you ain’t seen nothin’ yet.
For The Rum Rebellion
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