Whatever the COVID-19 pandemic started out as — a Chinese Communist Party sneak attack on the West, a less deadly version of the Spanish flu of 1918 or the Hong Kong flu of 1968, or a mutated bat virus — it’s now become something much more deadly than we imagined. It’s become the cause for a great global ‘reset’ to ‘solve’ global issues like climate change, inequality, and debt.
Of course, the only way to solve ‘global’ problems is with ‘global’ solutions. Those solutions are now becoming more transparent the deeper we get into the North American winter. Travel bans, lockdowns, skyrocketing unemployment, the shuttering of tens of thousands of small businesses, and the Daniel Andrews model of de facto house arrest for millions of people until the deadly virus is ‘eradicated’.
The news overnight from south and west Australia shows how futile this strategy is. An outbreak of just three cases of ‘unknown’ origin in northern Adelaide coincided with mandatory 14-day self-quarantine for all passengers from SA to WA. This happened — apparently — in mid-flight. Passengers on Qantas flights were informed when they landed of the new requirements.
A ‘deadly virus’ — from which 99.7% of people recover — has become the pretext for a complete reordering of how a free society and the free enterprise system work. In order to save humanity from itself, it has become necessary to destroy all the bottom-up, self-organising institutions that created such prosperity from which the global elites now loot.
Take interest rates for an example. The Reserve Bank of Australia (RBA) lowered its benchmark interest rate by 15 basis points to 0.1% on 3 November. The Commonwealth Bank followed suit by lowering the interest rate it pays on savings accounts. In real terms — when you account for inflation — you’re not going to earn hardly any interest income on your savings.
Are you a retiree who wants the safety of cash without the risk of stocks? Too bad. Say goodbye to interest income. That’s the big result of all central bank policies since the Global Financial Crisis. They’ve lowered interest rates in order to allow for an explosion in government and business debt. This debt creates the illusion of growth (it influences GDP calculations). But it becomes a massive drag on the economy long term.
I discussed the dynamics of this deflationary debt trap last week with Vern Gowdie. That conversation should be available to Vern’s readers soon. We agreed that the status quo puts investors in an almost no-win situation. Interest rates look like they have to remain low because of the huge debt burden — a burden only set to get larger as government lockdowns trigger higher unemployment and more ‘stimulus’.
If you can’t find any safe stocks that pay dependable dividends, then you either get on the trend-following train or get left behind in cash and real estate. The stock market has become like a Poker game where the small blind is buying tech stocks. If you’re not willing to take more risk, you’re out of the game.
Being out of the game might not be such a bad thing right now. But can you afford it? It’s the same dilemma investors have near the top of any market which is obviously overvalued. You can’t afford to miss out on the upside — even if you know it’s on borrowed time. And you convince yourself that YOU’LL be the one who knows when to head for the exits before the music stops.
The most dangerous trends of the last 40 years…
Is 2021 the year the music comes to a crashing halt in the financial markets? Maybe that’s part of the plan too. The ‘Great Reset’ discussed by the global elite in Davos (organised by Klaus Schwab of the World Economic Forum) is now in full motion. COVID-19 has become the catalyst toward digital money, the abolition of cash and a massive power grab by the state at the expense of individual liberty, free speech (tech censorship) and freedom of association (social distancing, lockdowns).
With people safely locked up at home, scared to death of sharing a meal or a beer, the technocrats, bureaucrats and psychopaths can get on with business of reshaping the world in the sustainable, controllable, subservient vision they have in mind. It’s not pretty.
It’s a great leap backward in human progress, where technology is used against us, where biology is weaponised as means of control, and where people with no assets, and no savings are deprived of an income and made wards of the state. The rest?
If you’re reading this, you probably are ‘the rest’. That means you have financial and real assets. You have wealth. And if you have wealth, you still have a bit of independence, financial and physical. What are you going to do with it?
This is the question I’m taking up with Bill Bonner in the next monthly issue of The Bonner-Denning Letter. The most dangerous trends of the last 40 years — centralisation, surveillance, the attack on savers — have accelerated. Things that we thought would take years to happen are happening in months now. As I wrote in last month’s letter, it’s later than you think.
Editor, The Rum Rebellion