Raising the Cross

When men choose not to believe in God, they do not thereafter believe in nothing, they then become capable of believing in anything.

Belgian author Émile Cammaerts

Last night, we got on a plane bound for Buenos Aires…

As you know, Argentina has gone all-out in its war against the coronavirus. First, we had our temperatures checked. Then our papers.

We needed to show our special permission to fly to Buenos Aires. We also needed to show our special permission to leave Argentina (long after our visa had expired).

Plus, we needed a declaration proving that we brought our cell phones into the country when we arrived. And then, they checked our temperatures again — 35,2 — and noted it on a form that gave us police approval to get on the airplane.

Will all this delay and inconvenience save one person from dying? Will this homage to ‘science’ pay off?

We doubt it. Argentina’s death rate is a bit higher than in the US.

Not tempting fate

But here in the capital, things seem almost normal. People wear the ‘holy rag’ — covering their mouths in deference to the new religion…desperately hoping this act of faith, like holding up a crucifix to ward off the devil, will protect them.

But the latest studies — one done on Marine Corps recruits on Parris Island, the other, a much broader study in Denmark — strongly suggest that face masks are useless.

Not that we know, one way or another. But so far, they are worn as an act of faith, not science.

People want to believe…in a vaccine…in a leader…in ‘science’ — in anything that will save them…

We are not really very ‘religious’. But we are not foolish enough to think we know how the world works or that we can bend it to our own desires. And we’re not reckless enough to want to diss the gods.

Jehovah, Pachamama, Zeus, Kali…we bow to them all. We go to church. We pick up pennies on the sidewalk.

Maybe it doesn’t make any difference…but why take chances?

Fallen cross

So it was that on Saturday morning, we found ourselves labouring up Mount Calvary…cross on our back…

For there, on the top of the hill, in the intense wind, the cross had fallen down. It lay on the ground, like a dead crusader.

We didn’t want to leave it that way.

And the ‘cross’ we bore up the hill was in the form of a STIHL chainsaw. The stem of the cross had broken. We were going to fix it.

The altitude makes work harder than usual. So we paused at each cross along the camino de la cruz (the stations of the cross) for profuse prayer…and deep breathing.

Finally arriving at the top, we cut off the broken wood (a very hard algarroba) and notched the remaining pieces so they could be fitted together (roughly) by the cowboys and secured with bolts.

Harmful fantasies

And what about the god of ‘economics’? There is a rascal, if ever we saw one.

The tenets of the faith are plainly preposterous:

…that they (the economists who run the Federal Reserve) can inflate the money supply — by printing more and more money — without causing domestic consumer prices to rise…

…that the world is suffering from an excess of savings, when savings rates are near all-time lows…

…that they can do a better job of price fixing than the free market…

…that they know what interest rates the economy needs…and what inflation rate it should have…

…that they can shut down an economy and replace real output (real wealth) with fake money.

These fantasies are not harmless. They encourage the world’s central bankers to print more and more money…until inflation finally explodes like a bottle of champagne. Then, who’s going to put the cork back in?

No one.

China effect

But wait…there’s more…

Charles Goodhart and Manoj Pradhan of the Bank for International Settlements (BIS) argue that inflation rates would soon head up, even if central bankers weren’t imbeciles.

They claim the declining inflation rates of the 21st century were caused by globalisation, not by the feds’ policies.

What really happened, they say, was that China joined the World Trade Organisation in 2001. It brought with it hundreds of millions of people who were ready to work their tails off for peanuts.

And despite the ‘communist’ party rhetoric, Chinese entrepreneurs and businessmen were actually freer to innovate and create wealth than their competitors in the US.

This — and output increases in other parts of the world — led to a big increase in the supply of goods, which depressed prices.

Inevitable inflation

But guess what? There is only one China. The China effect was yesterday.

And guess what else? All over the world, the working class is getting older…and retiring. Birth rates are falling. Fewer workers…ore retirees.

Inevitably, output per person will fall, too. Demand remains high, while supplies slump. Prices will rise.

Governments — mostly elected by old people — will need to print money to keep up with their commitments (entitlements).

What does that sound like? Messrs. Goodhart and Pradhan believe it will mean a major shift…from the low-interest-rate, low-inflation trend of the last 40 years…to a high-interest-rate, high-inflation trend for the next 40.

Four decades of fairly low inflation has produced a race of know-it-alls who believe incredible things and bow down before crackpots. They think they can do what no one has ever been able to do — create real prosperity with fake money.

Whatever else happens, their faith is likely to be tested.


Dan Denning Signature

Bill Bonner,
For The Rum Rebellion

Since founding Agora Inc. in 1979, Bill Bonner has found success and garnered camaraderie in numerous communities and industries.

A man of many talents, his entrepreneurial savvy, unique writings, philanthropic undertakings, and preservationist activities have all been recognized and awarded by some of America’s most respected authorities.

Along with Addison Wiggin, his friend and colleague, Bill has written two New York Times best-selling books, Financial Reckoning Day and Empire of Debt. Both works have been critically acclaimed internationally.

With political journalist Lila Rajiva, he wrote his third New York Times best-selling book, Mobs, Messiahs and Markets, which offers concrete advice on how to avoid the public spectacle of modern finance.

Bill has been a weekly contributor to The Rum Rebellion.

The Rum Rebellion