Category: simonblack

In 1862, in the midst of the Civil War, the Union government under Abraham Lincoln passed the Homestead Act, offering 160 acres of land, for free, to just about anyone, as long as you were willing to farm it.

For thousands of Norwegians, Swedes, and Germans facing poverty and land scarcity back in Europe, 160 acres of free land was an irresistible invitation.

Minnesota’s vast prairies, dense forests, and endless lakes bore a striking resemblance to their native Scandinavian landscapes, and soon waves of settlers poured in, building farms, churches, and towns from the ground up.

Over time, they forged a deeply rooted culture—agrarian, devout, self-reliant, and fiercely community-oriented—that would shape the identity of the North Star State for generations.

Later waves of immigrants chose Minnesota for entirely different reasons.

In the early 1990s, Somalia collapsed into chaos after the fall of its government, and the US quickly found itself entangled.

President George H. W. Bush deployed American troops under the banner of humanitarian intervention. But after the infamous Black Hawk Down incident in 1993 in which 18 US service members were killed, President Clinton pulled the plug.

With Somalia descending even further into civil war, and the US eager to distance itself from direct military involvement, the Clinton administration came up with a new solution: asylum.

Tens of thousands of Somalis were granted refugee status, brought to America, and then placed in various cities across the country.

Some ended up in the South. Others landed in San Diego. But a small group—almost by accident—found their way to rural Minnesota, where meatpacking plants offered something no other place did: immediate employment that didn’t require English fluency.

These early Somali immigrants seized the opportunity. They moved to Minneapolis… and then started telling their friends.

As one immigrant later said, they “loudly blew the whistle” to urge fellow Somalis to come to Minnesota.

And word spread fast: the jobs were real, the welfare system was generous, and the community was growing. And that’s how the Twin Cities—snow and all—became the unlikely capital of Somali America.

Today, Minnesota is home to an estimated 60,000-80,000 Somalis—the largest Somali population outside of Somalia itself.

And many have found that meatpacking is no longer their most promising opportunity.

Minnesota has gone out of its way to build a welfare machine so outrageous that it seems to have been designed for fraud.

Under Governor Tim Walz, Minnesota has become ground zero for the most staggering welfare fraud in the nation.

Programs were built around low barriers to entry and minimal oversight. And the results have been both predictable and catastrophic.

Take “Feeding Our Future”, a nonprofit meant to provide food for impoverished kids. In 2019, they received $3.4 million in federal funding. But once COVID hit, the grift went into overdrive.

By 2021, Feeding Our Future pulled in nearly $200 million, supposedly serving millions of meals across Minnesota. The reality? Fake attendance rosters, falsified meal counts, and fabricated invoices.

The money was instead spent on luxury cars, real estate in Africa, and lavish lifestyles. Somalis were at the heart of this fraud.

Then there’s the Housing Stabilization Services (HSS) program. Launched in 2020 with a $2.6 million estimate, the program ballooned to $104 million by 2024.

Investigators uncovered that many of the “providers” were nothing more than fictitious storefronts, billing Medicaid for services never rendered. Federal authorities have stated outright that the “vast majority” of HSS payments were fraudulent.

Federally funded autism services were the next target. In just five years, autism-related claims in Minnesota exploded over 100x from $3 million to nearly $400 million.

It turns out that many of these were fabricated diagnoses, providing an intricate system of kickbacks to parents who were willing to pretend that their children were autistic.

Many of these came from the Somali community, with one Somali-American woman alone accused of siphoning $14 million from the program.

Under Tim Walz’s administration, at least 28 separate fraud scandals have emerged, with most of the large-scale rings being perpetrated by members of Minnesota’s Somali community.

When government agencies or journalists raise red flags, they’re often met with a predictable defense: accusations of racism and xenophobia; Feeding Our Future even sued the state for racial discrimination when scrutiny increased.

The tactic worked. Timid politicians, unwilling to risk alienating a key voting bloc, turned a blind eye.

But the worst part is where most of that money ended up.

In 2023, the Somali diaspora sent back $1.7 billion to Somalia—more than the entire Somali government’s budget.

And Al-Shabaab, Somalia’s al-Qaida-linked terrorist group, takes a cut of every dollar remitted.

Investigators found that many of the senders were on public assistance themselves—meaning US taxpayers were indirectly funding a terror group that wants to destroy America.

The irony is that the US government has stacks of legislation—Bank Secrecy Act, PATRIOT Act, AML compliance, FinCEN regulations—all supposedly crafted to keep money out of the hands of terrorist and money launderers.

And yet, somehow, a network of welfare scammers in Minneapolis can funnel billions of taxpayer money overseas to fund a notorious terror group.

There are zero red flags, no meaningful enforcement, and absolutely no accountability.

You couldn’t invent a dumber system if you tried.

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Imagine the cost to insure James Bond against all the destruction he leaves in his wake—torched cars in Istanbul, collapsed buildings in Venice, botched assassinations in Macau.

That’s why, in the real world, intelligence officers—whether they’re CIA field operatives, FBI investigators, or high-level national security officials—all carry professional liability insurance.

This type of coverage protects federal employees when they’re personally sued or investigated for actions taken in the line of duty. It covers legal defense costs, civil damages, property destruction costs, and maybe even wrongful deaths.

That’s a lot of risk for an insurance company to take on. So you can imagine that, in order to even assess the policy risk, an underwriter would need access to extremely sensitive information on their prospective customer.

This might include data like someone’s clearance level, field deployment history, clandestine status, and more. And in the event that an insurance company needs to pay out a claim, they would likely even need classified operational details in order to conduct their own investigation.

That’s an extraordinary amount of highly secretive intelligence being made available to a private company… and it would amount to a major score for a foreign adversary.

Yet somehow, no one in the US intelligence community noticed when “Wright USA”—a little-known insurance firm that specialized in liability coverage for the CIA and FBI—was quietly acquired by Fosun Group in 2015.

Who is Fosun Group? It’s a Chinese conglomerate with deep ties to the Communist Party. In fact, the money to buy Wright USA actually came from the CCP, funneled through four Chinese state-owned banks.

Cost of purchasing Wright USA? $1.2 billion.

Value of the intelligence to the CCP? Priceless.

Granted, the US intelligence community at the time was busy preparing their phony Steele Dossier and manufacturing one of the most ridiculous lies in the history of the US government.

But still, you’d think someone would have realized that the CCP was buying the keys to the castle.

It gets better.

An investigative journalist eventually exposed the deal about a year later; the Obama administration scrambled to pressure Fosun Group to sell Wright back to a US company— which they did.

But the damage had already been done at that point. Fosun had already downloaded ALL of Wright’s sensitive data… which meant that the CCP had essentially EVERY American intelligence operative’s personal information.

Then some other US company bought Wright back from Fosun… meaning that China essentially got all of that information FOR FREE. They might have even made a small profit.

This single episode is utterly pathetic. What’s even more pathetic is that it is not isolated.

Also in 2015, Chinese hackers penetrated the US government’s Office of Personnel Management.

They stole security clearance records, fingerprint data, and personal files of over 22 million current and former government employees. They had that access for months before anyone even noticed.

Then there was the 2020 SolarWinds attack, when hackers inserted malicious code into a widely used IT platform, allowing them to burrow deep into US government agencies, major corporations, and defense contractors.

And in December 2024, a top Chinese official reportedly admitted that Beijing was behind the Volt Typhoon cyberattacks, which targeted critical US infrastructure such as the power grid, water systems, and telecommunications.

Malware was discovered lying in wait—strategically positioned to trigger at the most damaging moment—and it would be naive to think China hasn’t planted more of these digital tripwires, ready to deploy at a moment’s notice.

Even as recently as this year, the email system of the Office of the Comptroller of the Currency (OCC)—which oversees the integrity of the US banking sector—was hacked.

Beyond cyberattacks and economic espionage, China also subtly and effectively attacks the US in other ways.

After the trade war kicked off this year, China hit back by launching a new app— DHgate, an e-commerce platform that sold knock-off merchandise, undercutting America’s top brands.

Chinese influencers flooded the app with a seductive new message: don’t pay $120 for name-brand yoga pants when you can get the same ones for $15 from DHgate.

Overnight, the app shot up to #2 on Apple’s App Store in the US, just behind another Chinese e-commerce juggernaut, Temu.

Viral videos—boosted by TikTok’s CCP-influenced algorithm—showed Western consumers how badly they were being ripped off by major US brands. China manufactures most of that stuff anyhow, so why not cut out the middleman?

The strategy was to erode trust in American companies, undermine public support for tariffs, and make China look like the people’s champion— offering affordable goods while your own government drives up the cost of living.

But that’s nothing compared to China’s attack on America’s children: TikTok has become ground zero for psychological and social manipulation.

While American teens are challenged with deadly trends like the Blackout Challenge, Skullbreaker Challenge, and the Benadryl Challenge, their Chinese counterparts on Douyin (TikTok’s China-only version) are being served up math problems and educational content from 12-year-old calculus prodigies.

Then there’s DeepSeek— China’s version of ChatGPT; it’s another weapon that can be used to manipulate thought, perception, and behavior under the guise of ‘helpful’ AI.

Just consider the kind of information that an American user might casually discuss with such a system— stresses, fear, anxieties. Medical problems. Financial information. Politics. Product recommendations.

All that information flows directly into a model controlled by a regime with a track record of weaponizing data.

Of course, China still runs classic espionage ops too—including old-school honeypots.

One operative, Christine Fang infiltrated US political circles, formed sexual relationships with government officials, and got remarkably close to Rep. Eric Swalwell (who sat on the House Intelligence Committee).

She helped fundraise for his campaign, even placed an intern in his office, then vanished when the FBI started poking around.

Speaking of money in politics, China has figured out that you don’t need to buy the presidency to break a democracy. Just funnel a few million into state and local races, and prop up the loudest, least capable idiots.

China’s campaign contributions have engineered increasingly an dysfunctional Congress that seems to become more divisive and incompetent with each session.

Then the American voter does the rest, reelecting these same clowns cycle after cycle thanks to sky-high incumbent advantage.

Let’s also not forget how Chinese firms have been quietly buying up US real estate, including land next to critical military bases. One nearly built a wind farm just miles from Laughlin Air Force Base in Texas, where American fighter pilots train.

You don’t make that move for agriculture. You make it for strategic positioning for surveillance. Or worse.

China is obviously a tremendous ongoing risk to the United States.

Critical infrastructure is vulnerable. The ideological development of younger generations is being shaped by foreign-controlled algorithms. Our political system is exposed to manipulation. Industrial-scale espionage continues in broad daylight.

And over and over again, America keeps getting caught with its pants down.

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In 1871, as the Reconstruction-era US federal government was growing ever larger, work began on a massive office building in Washington DC to house the growing departments of State, War, and Navy.

It would become known as the SWaN building, and it was designed in the high fashion of its time—the grandiose and gaudy French Second Empire style.

Naturally, though, this being a government project, it took 17 years to finish, at which point the architecture was already out of style.

The building became widely mocked and deeply unpopular; Mark Twain reportedly called it “the ugliest building in America,” and it remained that way for quite some time. Even half a century later, then-President Harry Truman called it “the greatest monstrosity in America.”

It was so ugly that the US government even considered tearing it down in the 1950s.

But the sheer cost and logistical nightmare of demolishing a granite behemoth— just steps from the White House— ultimately spared it. Congress wisely decided that the cost wasn’t worth the benefit. (They seem to have since forgotten how to conduct this analysis.)

It was renamed the Eisenhower Executive Office Building in 1999, and today it still looms— gray, streaked with a century of grime, right next door to the White House. The interior has been renovated, but the exterior looks every bit the weathered Victorian artifact it is.

This is why President Trump recently suggested—casually in an interview—that he might clean it up and paint it white.

You’d think something as trivial as cleaning and painting a government building would be no big deal, squarely within the authority of the executive.

But not in America.

Instead, the President was once again sued. What else is new.

On November 14, the “DC Preservation League” and a law firm called Cultural Heritage Partners filed a complaint in federal court to block anything from happening to the Eisenhower Building, “without first complying with the National Environmental Policy Act (“NEPA”), the National Historic Preservation Act (“NHPA”), and the Administrative Procedure Act (“APA”).”

That’s right, no fewer than three pieces of federal legislation regulate how the government itself can clean and paint one of its own buildings.

If that weren’t ridiculous enough, the plaintiffs have actually demanded an emergency hearing (which has been scheduled for December 8) just to make extra certain that NO WORK can begin on the building.

Sadly this is hardly the first time the executive branch has been sued for doing… well, just about anything.

Earlier this year, Florida built a temporary immigration detention center—nicknamed “Alligator Alcatraz”—on federal land inside the Everglades. The project was done fast, clean, and by government standards, miraculously on budget. Modular pods, floodlights, fences, power, sewage—everything needed to house illegal immigrants detained under state law.

But the site happened to sit inside land managed by the National Park Service. So environmental groups had their excuse to obstruct!

Backed by the Miccosukee Tribe, they rushed into court claiming the facility violated NEPA, interfered with tribal land, and posed some unspecified threat to various birds and bats.

And on August 21, a federal judge issued an 82-page ruling that ordered the site shut down, all detainees relocated, and every bit of infrastructure dismantled within 60 days.

(The state appealed, and for now, the facility remains open while the case works its way through the courts—yet another federal project stuck in legal limbo with no final ruling in sight.)

With hundreds of thousands of federal rules on the books, all it takes is one endangered bat or obscure procedural statute to grind any project to a halt. It’s lawfare, plain and simple— not against any specific person, but against basic reason and progress.

It’s so out of control that government employees cannot be fired— and can sue anyone who tries.

Back in February, the President issued Executive Order 14210 directing federal agencies to reduce headcount—i.e. fire bureaucrats. Many of these bureaucrats couldn’t tell you what their job actually is, because nobody’s asked them in 30 years.

The government unions sued. And, unsurprisingly, an activist federal judge in Northern California granted a nationwide injunction, freezing the order while the case dragged through the courts.

It made its way to the Supreme Court by July, where diversity-hire Justice Ketanji Brown Jackson took it upon herself to write a 15-page manifesto howling that these proposed layoffs represented a “wrecking ball” against democracy.

When President Trump moved to prevent executive agencies from contracting with the law firm Perkins Coie—and to suspend their security clearances—another lawsuit followed.

This is the same law firm that helped bankroll the now-debunked Steele Dossier, acting as middleman for Clinton campaign money in the 2016 Russiagate operation.

But another activist federal judge stepped in, siding with Perkins Coie in a bloated, sanctimonious 100-page ruling invoking Shakespeare and de Tocqueville—while somehow forgetting to include, oh I don’t know, an actual legal argument rooted in the law.

If this is the kind of obstruction the federal bureaucracy throws at the President of the United States, imagine what it does to small business owners, entrepreneurs, and anyone in the private sector trying to build, hire, or innovate.

We can only hope this kind of absurdity motivates the current administration to take a machete to the regulatory state and finally free up the economy to produce. Then again, they’d probably get sued for that too.

Ultimately it’s all a sad reflection on the current state of America. It’s hard to be considered a serious country when you can’t even paint an office building.

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When mining superintendent Marcus Daly arrived in Butte, Montana in the late 1870s to evaluate a cluster of silver prospects, it was a mundane business trip— the mad western gold rush was over by then.

The area was known for its patchy silver veins, and Daly’s job was to decide whether there were still any mines worth buying.

All the ‘experts’ thought the boom was over. Gold and silver had fallen out of favor… and mines were selling for less than the value of the dirt.

So when Marcus Daly went underground at a modest site called the Anaconda, he noticed the ore didn’t look like a typical silver deposit… and that something much bigger was hiding below.

Daly pushed for the property’s purchase—about a $30,000 which would be about $1 million today. His reasoning? Beneath the silver veins, Daly had spotted a massive copper system.

The timing couldn’t have been better for a nation racing into an industrial age.

Telegraph lines, electrical wiring, motors, early power systems—America was devouring copper as fast as anyone could pull it out of the ground. And Daly’s discovery pushed the Anaconda operation from a forgettable silver claim into one of the engines of American industrial growth.

For years, that copper carried what became the Anaconda Copper Mining Company.

Output scaled, profits climbed, and Butte became synonymous with industrial metal.

But the silver never went away. As miners pulled the copper out of the ground, they were also extracting silver… which was sort of ‘in the way’ of the copper.

At first the silver was just an afterthought; Anaconda was a copper company, plain and simple. They just happened to mine some silver, almost begrudgingly, as an afterthought. And throughout the early 20th century and the Roaring 20s, nobody paid attention.

Then the Great Depression hit.

Copper demand—and prices—collapsed almost overnight as factories slowed, construction stalled, and electrical projects were shelved indefinitely.

Anaconda took a beating like everyone else—but it didn’t fold.

The “accidental” silver kept generating revenue even as the industrial economy stalled… and that silver revenue kept Anaconda alive when competitors were going out of business left and right.

It gave the company the diversification it needed to survive the worst phases of the worst commodity cycle — and stay standing when others didn’t.

This is far from an isolated incident—the mining industry is no stranger to these necessary pivots.

And it’s also not just a quirky footnote—it’s the kind of setup that gives investors a chance to buy into something most investors write-off.

For example, the latest edition of our premium investment research newsletter featured a company that ordinarily mines a critical industrial metal—one that’s necessary for all modern technology.

Funny thing is, this company also just happens to produce gold and silver.

They never set out to be precious metals miners. In fact, the company has been extremely successful in its core industrial metal business.

But with gold and silver prices hovering near all-time highs, the company is now minting profits from precious metals. Revenue is through the roof, but shareholders of the business are basically getting all of it for free.

That’s because, right now, the company’s stock is trading at a fairly low multiple JUST based on its industrial mining revenue… which means the market is valuing all the gold and silver production at zero. That’s completely absurd.

Overall this company trades at just FOUR times earnings. At that valuation, even if it were just an industrial producer, it would still be undervalued.

But it also produces enough silver to be close to a top 10 producer in the world.

There’s no rational reason for this business to be selling for such a cheap price. Yet the recent selloff in gold and silver prices only made it cheaper. Some mining companies fell 30%, even though they’re still raking in record profits.

Now is a great time to check out our investment research newsletter, The 4th Pillar, as we’re offering a limited time discount. Click here to learn more.

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When you think of hyperinflation, you might picture Zimbabwe’s trillion-dollar bills, or wheelbarrows full of cash in the streets of 1920s Weimar Germany.

More recently, Venezuela’s currency collapsed under the weight of runaway printing, and Argentina has spent decades lurching from one inflation crisis to another. Throughout history, inflation isn’t an exception—it’s the norm.

Poland is among the many countries which suffered its own bout of inflation in 1989 and 1990, triggered by the same familiar mix of government mistakes: massive deficits, political dysfunction, and a central bank used as a printing press.

In 1990 alone, prices in Poland jumped 586%. The złoty, Poland’s currency at the time, collapsed. One American professor living in Poland at the time said a monthly bus ticket cost what an entire summer cottage had ten years earlier.

This was the inevitable result of decades of command-and-control economics.

After World War II, Poland remained independent in name only. Soviet troops never left. The Communist party ruled with Moscow’s blessing. Private property was abolished. Prices were fixed by decree. Farms were collectivized. Dissent was criminal.

To keep the illusion of prosperity going, the government promised everything to everyone—jobs, housing, healthcare, cheap food—and paid for it with money it didn’t have.

When tax revenues fell short, the central bank simply printed more. But paper currency can’t conjure real goods. The result was shortages, black markets, and, eventually, total currency collapse.

That’s the world Adam Glapiński—current President of the National Bank of Poland—grew up in.

Born in 1950, he watched his savings inflate away throughout his early career.

Having fought as part of the anti‑communist underground and witnessed the country’s currency unravel in the early 1990s, Glapiński isn’t simply a technocrat—he’s someone determined to protect Poland from repeating its past.

That’s why he’s gone all in on gold.

And he’s part of the reason that Poland is one of the healthier economies in Europe. (Another is that Poland is one of the only places that hasn’t sacrificed itself on the altar of multiculturalism.)

But they still have a problem: a significant portion of their strategic reserve assets are denominated in US dollars.

And Glapiński has been rightfully concerned. Because when you’ve lived through a currency collapse once, you start paying close attention to the early warning signs.

He’s looking at the United States today and doesn’t like what he sees. The deficits keep climbing. The national debt keeps exploding. Interest expense has now surpassed military spending. Social Security is projected to run dry in just seven or eight years.

And the only thing both parties can unite for is to chase anyone trying to solve these problems out of town— like Elon Musk and his work with DOGE.

Glapiński’s not stupid. He can see the Federal Reserve cutting interest rates, even as inflation ticks up. He sees it ending quantitative tightening early, and gearing up for more quantitative easing— AKA money printing.

He can also see a point—relatively soon—when the US dollar is no longer the world’s dominant reserve asset.

The endgame is clear: the value of US dollar reserves will decline.

So he’s been trying to get ahead of it.

But what other strategic reserve asset is there for a central banker to buy?

Not the Chinese renminbi—you can’t trust their lack of transparency, manipulated numbers, and massive debts.

Not the British pound—Britain’s a fiscal and political mess.

Poland will hold some euros, sure, but the euro-zone has plenty of structural problems of its own.

Gold is the best option left.

Not because Glapiński is a gold bug— this is a completely rational move.

Gold is one of the only assets with a large enough market that you can invest tens of billions of dollars. Then, you can hold it within your own borders, free of counter‑party risk. You don’t get that benefit if you’re holding another government’s bonds, which can be defaulted on, frozen, or weaponized as the US has shown.

Glapiński’s target was for the National Bank of Poland to hold 20% of its reserves in gold.

But when they hit that target, he raised it to 25%… which they also recently hit.

And now he’s pushing for 30%.

There are two main things to understand about this.

One, he’s far from alone.

Countries like Russia, China, and other usual suspects are buying literal tons of gold, largely because they don’t want to be frozen out of their US Treasury holdings.

But its not just them. It’s also Kazakhstan, Bulgaria, El Salvador— central banks around the world are buying way more gold than usual.

As recently as 2010, central banks added a grand total of just 79 tons of gold to their reserves.

In 2024, they added a cumulative 1,089 tons. And that’s been the trend—1,000 tons per year—since 2021. That’s about double the previous decade’s average.

The second thing to understand about demand from central banks is that they are relatively price insensitive.

They’re not buying gold to speculate and sell later for more dollars. They’re buying it to diversify away from the dollar.

While they may try to time certain purchases to go further, they’re not going to let $4,000 per ounce gold change their overall reserve strategy.

They know they need to continue buying gold for one simple reason: they’re losing confidence in the US government.

And that demand alone is probably enough to continue to push prices even higher.

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Sometimes it feels difficult to get one’s bearings.

Markets are near all-time highs, yet extremely volatile. America is the ‘hottest economy in the world’ attracting trillions of dollars in capital, yet inflation is up… and seemingly almost every week some major corporation announces mass layoffs.

Very little makes sense these days. So today I wanted to take a big picture view of what’s happening in the US economy… and more critically, where it may be headed.

1. It’s all about the US federal budget deficit

It’s not exactly controversial anymore to say that federal spending is completely out of control. Fiscal Year 2025 (which ended on September 30 of this year) posted another $1.8 trillion deficit, and interest on the national debt exceeded all military spending.

This becomes worse each year and will soon reach a point where it is unfixable. The government has to borrow money just to pay interest on the money it has already borrowed… which means that the annual interest bill– already more than 20% of tax revenue– will continue to increase.

2. The budget deficit has to be financed, one way or another

When the US government spends more than it collects in tax revenue, it makes up the difference by selling more debt, i.e. Treasury securities. Very broadly, you could group the investors who buy the US government’s debt into two groups: foreign investors and domestic investors.

3. Foreigners are abandoning US debt faster than anyone cares to admit.

But for the past few years, foreigners (including foreign governments, central banks, large corporations, commercial banks, and even individual foreign investors) have been net SELLERS of US Treasury securities.

It’s not hard to understand why; the entire world has witnessed utter chaos and insanity, from a guy who shook hands with thin air, to the disastrous withdrawal from Afghanistan to TWO attempted assassinations of a Presidential candidate, to “Liberation Day”, to the government shutdown, and more.

Plus, all along the way the national debt reached an eye-popping $38 trillion. Foreigners are no longer looking at US government bonds as a “risk free” or “safe haven” asset. Instead, it just looks better to avoid.

4. Domestic investors don’t have enough savings to finance the deficit

Each year, between businesses and consumers across the US economy, a total of roughly $1-2 trillion in “net savings” is generated. This is essentially the combination of all business and corporate profits, plus the net total of whatever households have left over after paying all bills and expenses.

This year net domestic savings in the US economy is on track to be less than $1 trillion. But the budget deficit is roughly $2 trillion. This means there’s simply not enough savings in the United States to finance the annual defict.

5. So, the Fed steps in and fills the gap

Since foreigners aren’t buying, and the domestic economy doesn’t generate enough savings, the only option left to finance the budget deficit is for the Federal Reserve and the banking system to create the money.

That’s why, over the past decade, US money supply has grown by 6.8% annually, while the real economy has only grown at 2.3%– a difference of 4.5% annually.

In short, this means that the growth in money supply is significantly greater than growth in the production of goods and services.

A 4.5% difference isn’t very much if it were just a single year. But if you compound that 4.5% difference over 10-15 years, it means that the amount of money in the system has become substantially greater than the amount of goods and services in the economy.

So there’s a LOT more money chasing around less ‘stuff’. The net result is inflation.

6. Bad policy makes it worse

Between 2020 and 2024, the U.S. went from being a net energy exporter to importing the equivalent of 2 million barrels per day. That wasn’t a weird coincidence—it was the deliberate result of idiotic Biden-era policies. Refinery shutdowns, blocked leases, and a full-scale war on domestic energy.

This is a big deal; energy, on average, comprises roughly 50% of the cost of producing nearly everything– food, automobiles, clothes, equipment, microchips, etc. So higher energy prices ripple through the entire economy as higher inflation.

It’s the same story with healthcare. Obamacare is the poster-child for horrible policy—it was supposed to make it “affordable”? Since then, costs have doubled.

Bad policy makes our lives more expensive.

7. Then it all impacts the labor market

When prices rise, households cut back. That’s exactly what’s happening now. Big consumer-facing businesses—Walmart, Procter & Gamble, even Amazon—start slashing costs, which usually means jobs.

Layoffs are rising. The labor market is weakening. And technology only makes it easier to let go of workers. Now we’re stuck with high inflation and a weak job market—otherwise known as stagflation.

8. Again, it starts and ends with the deficit.

The government spends too much, borrows too much, and prints too much. Inflation follows. That hits consumers. Businesses respond by cutting back. The economy slows. And the cycle repeats.

Can America break out of this cycle? Absolutely.

The tools already exist– or are on the way: advanced automation, small modular nuclear reactors, and next-gen natural gas tech that could make energy cheap and boost productivity across the board.

And I think we’ll get there eventually.

But in the meantime, there could easily be a bumpy, stagflationary road ahead over the next couple of years. The budget deficits are still massive, and I don’t see a shred of political will in Congress to rein in the spending.

In today’s podcast, we talk about all of this in more depth—what it means, where it’s going, and what you can do about it.

Because the key is not to wait for Washington to fix it… but to have a Plan B while they keep making it worse.

You can listen here.

And you can access the podcast transcript here.

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We sincerely hope the House of Representatives can pull itself together and get the government back open this week.

Not because we love federal bureaucracy—but because this shutdown is embarrassing, and it continues to chip away at the rapidly declining confidence that foreign governments and central banks have in the United States.

This matters. Foreign governments and central banks collectively own $10+ trillion of US government bonds and other agency securities.

And given how rapidly the national debt is rising, the Treasury Department needs every lender they can get.

Up until recently, foreigners have always happily stocked up on US government bonds— which were traditionally viewed as THE world’s “risk free” asset.

But over the past few years, they’ve seen endless financial chaos and political dysfunction.

They watched Joe Biden shake hands with thin air. They watched the humiliating US withdrawal of Afghanistan. They watched millions of migrants stream across the US border with impunity, then be showered with taxpayer benefits. They watched TWO assassination attempts on a Presidential candidate.

Then, even after last year’s election, they watched the richest guy in the world willingly roll up his sleeves to help eliminate federal waste and cut the deficit— only to get chased out of town by politicians who are addicted to fraudulent spending.

They’ve watched extreme political dysfunction, with two sides who can’t agree on anything… including the most basic task of keeping the government open.

They’ve watched deficits grow and the national debt spiral to $38 trillion. They watched the debt grow by HALF A TRILLION dollars just over the past SIX WEEKS when the government was supposedly closed.

In short, if you were a foreign government or central bank, there’s little chance you would look at Congress and think, “these are serious, responsible people.”

Quite the opposite. In fact you would probably think that it’s time to start cutting your Treasury holdings and back away from the US dollar. After all, the United States Congress doesn’t exactly look “risk free” any longer.

Foreigners understand that a time is coming—sooner rather than later—when the US dollar will no longer be the dominant global reserve currency. Many central banks still hold nearly 100% of their reserves in US dollars. They know they need to diversify.

And we’ve written about this many times before— the #1 asset that they’re purchasing right now is gold.

It’s not because these foreign central bankers and finance ministers are irrational gold bugs. Instead, they understand that gold is nearly the only asset that (1) is universally accepted, (2) carries zero counterparty risk, and (3) has a large enough market to absorb hundreds of billions of dollars in capital flows.

That’s why, from Poland to Ghana to Kazakhstan, central banks have been buying gold in record quantities. It’s not just China.

China is the most desperate. They hold hundreds of billions in US dollar assets as part of their strategic financial reserves, and the Communist Party is extremely concerned—because they see a real possibility that they could be at war with their own borrower in the future.

Only three central banks were selling gold last quarter—and their reasons are easy to understand.

Russia was one—not because they love the dollar. But because they need to fund a war. Frozen out of the global financial system, gold has become almost a medium of exchange for the Russian government.

Singapore was another. Most central banks only buy strategically; they don’t try to turn a profit. Not Singapore. Their financial institutions are filled with sharp traders who would sell high into record trading volume, with the intent to buy gold back at a lower price.

In fact, it wouldn’t surprise me if the Singaporean government picked up more gold during the recent price dip earlier this month.

The third was Uzbekistan, whose central bank already holds about 80% of its total reserves in gold. With gold prices up, the value of their holdings ballooned—so selling some is simply a way to re-balance.

The problem for most countries is that they have too many dollars and not enough gold. Uzbekistan is the lone example of a country with too much gold and not enough dollars. So their gold sales, while unusual, make sense.

We keep talking about this because it truly is one of the most important trends of our time.

The US government’s fiscal condition is atrocious. Almost no one in Washington is willing to take it seriously. But foreign governments and central banks are—and that’s exactly why they’re buying gold.

That trend won’t reverse unless, miraculously, everyone in Washington starts treating the national debt like the emergency it actually is.

I’m not holding my breath.

That’s why we believe $5,000 to $10,000 gold is a completely valid future scenario—and why mining companies, precious metals producers, and real asset businesses are so well positioned.

We discuss several of these miners in today’s podcast, including Barrick, Newmont, and Franco-Nevada.

And we also highlight some of the overlooked smaller gold companies that, right now, are just absurd bargains.

You can access the podcast transcript, here.

PS – We write about this because we’re extremely proud of what we do.

We provide extremely high-quality research, and the results speak for themselves. Four of our precious metals companies are up 3-4x, even after recent pullbacks. Another seven are up 35–150%.

With our no-questions-asked money-back guarantee, and a limited-time promotional price, now is a great time to join. Click here to learn more.

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Barrick Mining Corporation—one of the world’s largest and most established gold producers—just reported its third quarter earnings yesterday— and it was an absolute blowout.

The company reported third quarter profit of $1.3 billion, nearly triple last year’s Q3 earnings.

And for the first nine months of 2025, Earnings per Share is up a whopping 132% over the same period last year. Free Cash Flow is up an astonishing 176%.

The company further announced that they’re raising the dividend by 25% and expanding the company’s share buyback authorization by an additional $500 million, after already repurchasing $1 billion worth of shares under the prior program.

And what’s perhaps even more striking is that these record profits were based on an average gold price of $3,200. This means that the company’s Q4 earnings (which we’re nearly halfway through) should be MUCH higher given that the gold has averaged $4,041 so far this quarter.

Our readers won’t be surprised to hear any of this; we’ve been saying for the past few years that gold was going to go much higher— specifically because foreign governments and central banks have been buying gold by the metric ton to diversify their strategic reserves away from the US dollar.

This trend isn’t going away.

Between the government shutdown fiasco, the rising $38+ trillion US national debt (up $500 BILLION just in the last six weeks), extreme political dysfunction in Congress and the courts, etc., foreign governments and central banks are continuing to literally buy tons of gold, even at record high prices.

We also wrote that gold companies (including miners like Barrick) would benefit substantially from rising gold prices.

So, just as we predicted, Barrick (among other gold miners) is raking in record profits, and its stock price has doubled this year alone— outpacing gains from Oracle, Nvidia, Palantir, and pretty much every major large cap company in the market.

But here’s what’s really amazing— despite such stellar performance, many of these gold companies are still cheap.

Barrick stock, for example, is near its all-time high. Yet the company is still valued at less than NINE times forward earnings— and that’s assuming gold doesn’t go up further from here.

(And even if the gold price tanks, Barrick will still be a profitable, dividend-paying, modestly valued business. Remember, Barrick’s record profits are based on $3,400 gold!)

Smaller gold companies— the ones that we focus on in our premium investment research— are even cheaper.

One of the gold miners we’ve featured is already up 4x this year. Yet it still trades at just 3.5 times forward earnings. The company is extremely shareholder-friendly and has a pristine balance sheet with zero net debt. Oh, and did I mention they pay a substantial dividend?

The gold price could collapse to less than $3,000 and this company would still be wildly profitable.

Could that happen? It’s possible. Even during the 1970s when gold rose from $35 to $850, gold suffered a major pullback in 1975. The pullback was temporary, and gold rose over 8x from there.

That’s because the fundamentals driving gold’s rise during the 1970s hadn’t really changed.

After Richard Nixon formally ended the Bretton Woods system in August 1971, foreign governments and central banks rapidly began selling their US dollars for gold.

As the decade progressed, foreigners became increasingly concerned about US deficits, government dysfunction (Watergate in 1973), global instability, waning US power, and more.

And despite a brief pullback in gold prices, this trend continued until the early 1980s, when the election of Ronald Reagan restored confidence in America’s might and fiscal discipline. It was only at that point that gold prices started to fall.

This same trend is unfolding today, and it’s not hard to understand: the record high US national debt = record high gold price.

Foreign governments and central bank remain deeply concerned about America’s fiscal condition, and gold is one of the few assets available for them to diversify their US dollar holdings.

Just like in the 1970s, we expect this trend to continue until Congress proves that it can act like  grownups and be fiscally responsible.

In the meantime, we anticipate gold— and gold companies— to continue to perform very well. Again, many are posting record profits yet are still insanely undervalued. We do not expect this anomaly to last.

PS– We write about our investment research because we’re extremely proud of what we do.

This is enormously high quality research and the results speak for themselves. Four of our precious metals companies are up 3 and 4x, even after recent pullbacks. Another seven are up 35-150%.

With our no questions asked money back guarantee, and a limited time promotional price, now is a great time to join. Click here to learn more.

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By the autumn of 1648, England had been embroiled in a chaotic and bloody civil war for more than six years.

Extreme ideological tensions in England had been building for decades over freedom of religion, plus the balance of power within government.

King Charles was wildly unpopular. And a majority of politicians in parliament saw it as their sole mission to resist him. Many believed adamantly that parliament should rule over the king and ultimately dictate all laws in England.

On the other side, a number of traditionalists thought parliament to be a corrupt body of liars and thieves, and they wanted to preserve the power of both church and king.

Tensions erupted into war in 1642, eventually resulting in Charles’ capture and imprisonment.

At that point the majority of parliament didn’t have any desire to extend the crisis any further. They felt like they had won sufficient concessions. Enough was enough. So they negotiated a peace treaty to end the civil war, much to the relief of people across England.

Unfortunately there were a number of radicals who pledged to continue the fight no matter the cost. They viewed any compromise as failure.

One of those was a little known Member of Parliament named Oliver Cromwell, who, on December 6, 1648, sent more than a thousand troops to surround the palace of Westminster and block the entrance of Parliament.

Only the most radical members were allowed entry; the rest were either blocked or arrested.

Cromwell’s aim was to prevent the peace treaty from being ratified; he felt that it was too soft with too many compromises. And as a result, the English Civil War continued, followed by Cromwell’s personal dictatorship, for more than a decade.

I hope I’m wrong but I think the US is in store for a similar head fake. After more than a month of the shutdown, there were signs over the weekend that a compromise had been reached in the United States Senate.

But the theater began almost immediately after, with the radical Left vomiting all over the deal and insisting that they would “continue to fight.”

My sense is that while a lot of people may believe that the government shutdown is nearly over, this may in fact just be another miss, just like England’s ‘almost’ peace treaty in 1648. There’s a good chance this compromise will be blocked by aggressive radicals in Congress.

To say this is a national embarrassment is a massive understatement. And at this point it’s nearly all branches of government and institutions chipping away at the remaining dignity of America.

One of the things that I find most bizarre is how many prominent radicals seem to think their shutdown is “winning the hearts and minds of the American people.”

They believe this because of last week’s gubernatorial elections in New Jersey and Virginia in which the candidates from their party won.

Now, the combined margin of victory of both candidates was about one million people. There are roughly 350 million people in the United States.

Yet, in the mind of a Leftist radical, one million voters in two states speak for 350 million Americans in 50 states, and therefore they have a moral mandate to keep “fighting” while the government remains closed.

This raises a key question: fighting for what?

Well, they claim to be fighting for healthcare affordability. Coincidentally this is the same party that passed Obamacare more than a decade ago— during which time the cost of health insurance in the US has soared above and beyond the already uncomfortably high rate of inflation.

Strange, considering that the actual name of the legislation was the Affordable Care Act. Yet it seems to have only made healthcare less affordable.

Naturally the radicals’ knee-jerk reaction is to blame capitalism or evil corporations.

However this Leftist logic also collapses under scrutiny.

Gross profit margins at major health insurance providers, for example, have actually declined since the Affordable Care Act was passed. This means that those ‘evil insurance companies’ are making less money on every policy, not more.

None of these radicals has stopped to question why health insurance in America is so expensive. Instead their answer is to shutdown the government— shoot first, and ask questions never.

Not to be outdone, various state and local governments across the country have engaged in their own histrionics, pledging to “fight” and “resist” without ever explaining what or why.

The end result has been an avalanche of lawsuits, and the judicial branch has sadly become equally culpable in this national humiliation.

There are so many activist judges presiding over federal courts now that it’s easy for a progressive agenda to slide through without any whiff of jurisprudence.

A recent ruling by a federal judge in Rhode Island ordered the Trump administration to pay billions of dollars to SNAP beneficiaries, despite the program being unfunded by Congress.

His argument had nothing to do with the law, or the Constitution. Instead he merely said, “this should never happen in America.”

In other words the order was based on his personal view, not on the law. He also, strangely, put all the blame on the Trump administration, rather than the radical Left in Congress that continues to keep the government shutdown and unfunded.

But this is par for the course. The media, which has a strong role to play itself in the national humiliation, takes all of its talking points from the DNC and blames the president for everything.

This whole episode is showcasing not only deep irreconcilable ideological divisions in the United States (culminating in the election of a communist in NYC), but also a horrific level of dysfunction.

This matters, for at least one simple reason: the United States desperately needs foreigners to buy its debt.

You might not realize this, but since the government  shutdown began at the stroke of midnight on October 1st, the US national debt has increased by HALF A TRILLION DOLLARS. In less than six weeks.

That’s an enormous amount of debt— and America needs every lender it can find.

Foreigners traditionally buy a huge chunk of US debt, because, up until recently, the US was always considered “risk free”.

Not anymore. Let’s be honest— what foreign country is watching all of this chaos and thinking, “that’s a responsible government… let’s buy their bonds.”

Instead, foreigners are starting to diversify from their US Treasury and dollar holdings… into gold. And that’s why the gold price, in the long run, still has much higher to go.

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Imagine for a moment you own a small piece an old, well-established, family-owned business.

Your long-lost ancestors started this company a few centuries ago, and subsequent generations built it into a global powerhouse— we’re talking $100 billion in annual revenue and hundreds of thousands of employees.

Hundreds of years later, the family business is well past its peak and is in decline.

And at this point the ownership is in the hands of thousands of descendants of the original owners. But even with all of those different perspectives, everyone agrees that something needs to change.

The various stakeholders still believe in the company, still believe that the brand can be restored to its former glory. But it’s definitely time for new leadership.

So the company starts a search to recruit a CEO. Your fingers are crossed that they find a highly experienced turnaround specialist who knows how to restore fallen stars.

Yet, to your utter bewilderment, the executive candidate that most of your fellow stakeholders support is someone who has absolutely no business experience… someone who has never managed a single employee.

In fact, he’s never even had a real job! He’s never run a budget, let alone a large organization’s, he can barely manage his own finances, and to make matters worse, he actively hates business.

Why would anyone support such a candidate for the company’s top job?

Well he’s a fairly well-spoken, charismatic guy. He has a winning smile. He checks a bunch of diversity boxes.

He also offers some ideas that really excite your fellow stakeholders— even though none of his ideas actually survive scrutiny. His ideas remind you of the election for your high school class president where one of the candidates promised to put Coca-Cola in the water fountains…

You’ve been around business long enough to know ideas are pretty worthless. Execution is what matters. But you find yourself in the minority… and the other stakeholders end up choosing this inexperienced neophyte to lead the company.

This is what NYC did yesterday in electing Zohran Mamdani. And it’s really hard for any rational person to expect a positive outcome.

It’s easy to lament the election of a card carrying Socialist. But if we’re being intellectually honest, we can acknowledge that a lot of people are suffering. They’re struggling more than they used to—and they don’t understand why.

Voters don’t understand how years of mismanagement and waste at the city level have led to a significant decline in municipal services. Crime rates are up, and even the basics like garbage collection or the city’s rat infestation just continue to get worse.

Nor do voters understand how idiotic state policies have driven productive people and businesses away from New York state to friendlier jurisdictions like Florida, resulting in a hollowing out of the tax base (and hence reduction in services).

They also don’t understand how the blowout of federal spending—starting especially with the pandemic—has resulted in higher levels of inflation.

And they definitely don’t understand the vagaries of monetary policy, and how the Federal Reserve’s mistakes have fueled the inflation problem.

Most voters don’t understand any of these things. (Neither does Mamdani.) They only know that they’re falling further behind, and they want change.

Well, change they got. Unfortunately, it’s probably not going to be a good change.

Ironically, one of the other things voters don’t understand is Socialism.

These days, most people who like the idea of socialism skew younger—too young to remember the Soviet Union.

When they think of Socialism, they think Norway. They think it’s possible to have free healthcare, free education, robust pensions and retirement, social safety nets, low unemployment, and a strong economy all at the same time.

The reality is far different.

Scandinavia has achieved certain success in its public welfare programs because, at least until recently, they were high-trust societies with relatively low corruption and high levels of competence in government administration.

A better example of Socialism is Venezuela—a very low-trust society where you have inexperienced, corrupt, incompetent people who regulate every aspect of the economy.

The end result has been everything from widespread starvation to an endless economic depression.

With the election of Mamdani, the ingredients look a lot more like Venezuela— incompetence, inexperience, high-regulation, etc.

Yet people very naively are expecting a result that looks like Scandinavia. In other words they think they can have Venezuelan inputs and Norwegian output.

Good luck with that.

We talk about all this, and more, in today’s podcast.

We cover the lunacy of some of Mamdani’s specific policies and why he won’t be able to achieve them.

We discuss Scandinavian public welfare, and why those systems are eroding thanks to multiculturalism.

We talk about why high-trust societies require shared values and social cohesion—and New York City doesn’t have any of that.

We also discuss the biggest thing that voters are missing. One of the biggest problems in the US is that it has terrible leaders. You only need to look at AOC, Bernie Sanders, Elizabeth Warren, Jasmine Crockett—complete buffoons—and wonder: how do they get elected year after year?

Voters are completely naive. And it’s hard to imagine the US fixing its problems if voters continue sending incompetent, destructive politicians to represent them.

You can listen to the full podcast here.

The podcast transcript is available to you here.

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