Category: simonblack

On November 5, 1605 Guy Fawkes was caught in the cellars of the Parliament building in London in what became known as the Gunpowder Plot— a conspiracy to assassinate King James I and restore a Catholic monarch to the English throne.

Guy Fawkes was arrested, tortured, and executed.

And his name, ‘Guy’, became an extreme insult. If someone called you ‘guy’ in the early 1600s, fists might fly— after all, it referred to a traitor who tried to murder the king.

The term ‘guy’ was also used to insult people’s looks or clothing, as the public often burned effigies of Guy Fawkes that were made to look grotesque or shabbily dressed.

Over time, though, ‘guy’ took on a different meaning. Today it’s just an informal way to refer to a man.

This is common in languages. Over decades… and even centuries… words tend to change meaning.

In the last few years, however, a handful of people have hijacked languages, and decided for everyone that words have new meanings.

But they never give us a nice new definition you could look up in the dictionary. The words mean whatever they want them to mean at any given time.

And that has been the fate of many words, for example, violence and genocide.

According to Merriam-Webster dictionary, violence is, “the use of physical force so as to injure.”

But over the past few years, woke activists have hijacked this word and redefined it to meet their absurdly broad criteria. Misgendering a trans person, for example, is considered “literal violence.”

Transgender actor Laverne Cox may have started that trend as far back as 2014, claiming “Misgendering trans people is an act of violence.”

More recently a school district in Philadelphia, plus various “Gender 101” university courses, have claimed the same.

Call me old fashioned but I always thought violence required actual physical contact.

But they don’t stop at violence.

The Trans Radical Activist Network (TRAN) claims that deliberate misgendering of trans people is akin to participating in a genocide against them.

The Daily Kos, a progressive political website, claimed Trump’s plan to ban gender reassignment surgery and puberty blockers for minors was, “a genocidal plan against all transgender existence in the United States.”

Growing up I recall the word genocide being used exclusively to describe holocaust-level atrocities— the murder or attempted murder of entire ethnic groups or minorities.

Pol Pot waged genocide against millions of Cambodian intellectuals. Hutu militias wiped out hundreds of thousands of ethnic Tutsis during the Rwandan genocide of the 1990s.

Yet today, people who are against transgender athletes participating in women’s sports are accused of committing genocide.

Another example: In 2019, Finnish politician Paivi Rasanen tweeted a Bible verse that was considered homophobic.

She was investigated for two years and ultimately indicted on three counts of “war crimes and crimes against humanity”. She was found not guilty, but the prosecution has appealed.

These terms— war crimes, crimes against humanity, violence, etc. have been completely hijacked by the woke mob… and they have no real definition anymore. Genocide means whatever some rabid activist wants it to mean.

This is why Canada’s new ‘hate speech’ law caught my eye.

Prime Minister Justin Trudeau’s government recently passed the “Online Harms Act”, claiming that it’s all about protecting children. And that certainly sounds like a noble intention. After all, who could possibly be against protecting children?

But the bill also states that, “Every person who advocates or promotes genocide is guilty of an indictable offence and liable to imprisonment for life.”

It also demands life in prison for any crime, “motivated by hatred based on race, national or ethnic origin, language, colour, religion, sex, age, mental or physical disability, sexual orientation, or gender identity or expression.”

Now, I happen to be in favor of free speech… and that even extends to offensive, idiotic speech that has no place in a civilized society. So throwing someone in prison for life because of words seems ridiculous to me… especially given the bizarre double standard of woke justice.

Bear in mind that criminals who commit actual violence are routinely turned back onto the streets because bail is ‘racist’. But hate speech is considered a crime that may now carry a life sentence.

If genocide still meant ‘the systematic murder of entire groups of people’, this new Canadian law might not be too scary.

But we live in a world where some very powerful people think that misgendering someone is akin to genocide.

Trudeau in particular has already bent laws to increase his own authority. He silenced his opposition throughout 2020-2021, and when the Freedom Convoy protested his mandates, he de-banked them, imprisoned them, and denied them bail.

He seized authority that voters never gave him, and he used it to hurt people.

Does anyone honestly think that this new law won’t be abused to do the same thing? The government can lock somebody up for life now based on ideas which have no longer have any defined meaning.

What is Justin Trudeau’s definition of genocide? Or violence? Or war crimes? What is his definition of hate?

I’d love to know. But I doubt they’ll ever tell us.

And that’s the problem with these woke people— they love to accuse people of things, but they never define the thing that they accuse people of.  

Inspired Idiots like Trudeau are on a crusade, and are delusional enough to think they are actually making the world a better place.

But destroying things as fundamental as language, and threatening life in prison over whatever the definition happens to be today, makes people less free.

This is a guy who smeared the Freedom Convoy— protesters with legitimate grievances against the government— as “misogynistic and racist”, and wondered aloud “do we tolerate these people?”

And when a government starts pushing life in prison over behavior that they can redefine in their sole discretion, it should be pretty easy to understand why you ought to think about a Plan B.

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Dwight Eisenhower had a huge problem in 1948.

After winning the war in Europe and defeating the Nazis, “Ike” was one of the most popular and recognizable men in the world… and publishing houses were falling all over themselves for his memoirs.

Doubleday, a New York based publisher, won the bid by paying a massive $635,000 advance for the book rights. That’s worth tens of millions in today’s money, putting him in the same category as the Obamas’ two book, $65 million publishing deal.

Eisenhower’s problem, however, was the US tax code; $635,000 would immediately bump him into the highest income tax bracket with a 91% marginal rate, and he would have to fork over the vast majority of that income to the government.

But for some bizarre reason, the Treasury Department issued an unprecedented tax ruling in Eisenhower’s favor; they claimed that he was not a professional author subject to income tax.

Rather, the Treasury Department explained, the former general was merely profiting from the sale of an asset, i.e. his life experience, and was thus only required to pay capital gains tax of 25%.

I doubt anyone in the Treasury Department actually believed such a weak argument; most likely there were a few very powerful people trying to help Eisenhower out, and they made up some ridiculous justification to cut his tax rate.

Obviously this tax ruling no longer exists, and Eisenhower was one of the few people to benefit from it. But for a very, very short time in the United States, the government peddled the ridiculous fiction that certain ‘income’ was really just a ‘capital gain’.

There is now a growing chorus of shrieking sirens within the government that is trying to do the opposite– pretend that ‘unrealized’ capital gains are really income in disguise.

Joe Biden tried to make this case on Monday when he rolled out his new 10-year budget proposal… which is every bit as absurd fiction as Eisenhower’s tax ruling.

“Fairness” is a big part of the President’s budget proposal. Sounds good. After all, who’s not for fairness?

Except that they never bother to define their terms. Exactly how much is a “fair share”? No one actually says. All we know is that it’s never enough.

Part of his proposal is to enact a “25% minimum tax” on the wealthiest Americans with a net worth in excess of $100 million.

25% of what, exactly? Who gets to decide how much a person’s “income” is?  What qualifies as income?

It’s obvious from the President’s explanation that they want to count unrealized capital gains as income.

In other words, if you buy shares of Apple, and your Apple stock goes by 10%, they deem that 10% to be income even though you haven’t sold a single share or received any money for the investment.

This creates a lot of complications and questions.

For example, consider that Hunter Biden (by his own admission) is holding on to $10 million on behalf of the ‘Big Guy’.

Based on the President’s logic, this means that the Big Guy’s wealth, i.e. ‘income’, has increased by $10 million even though he supposedly never actually received any money.

Moreover, Hunter Biden has been able to make millions of dollars by monetizing his family’s name; this makes the Biden ‘brand name’ an obvious asset. And given all the money that Hunter has made, any reasonable financial model would easily value this brand name asset in excess of $100 million, and hence be subject to the wealth tax.

Ultimately the wealth tax is a pointless idea anyhow. Even in the President’s own budget proposal, the projected revenue from a wealth tax doesn’t move the needle on America’s endless deficits.

The proposal shows, in fact, that the US national debt still continues to rise, quickly reaching 130% of GDP and shooting well past $50 trillion… even assuming his wealth tax is passed.

Yet he also assumes that America can continue to rack up massive deficits year after year without any consequences.

Mr. Biden thinks inflation will remain low. Unemployment will remain low. Interest rates will remain low. And zero reforms will be made to Social Security and Medicare benefits, even though the programs’ trust funds are set to run out of money in ten years.

This is such a bizarre fantasy… and another important reminder that the people in charge aren’t even capable of acknowledging the problems (that they themselves have created), let alone speaking honestly about the solutions.

Now, we are not pessimistic people; on the contrary, I think there is a tremendous amount of opportunity in the world and I am wildly optimistic about the future.

However it would be foolish ignore such obvious risks.

Even the President’s new budget proposal forecasts that the national debt will spiral out of control. And interest payments on the debt will consume a greater and greater percentage of tax revenue.

The only real solution is for the Federal Reserve to slash interest rates and start creating more money again, all in an effort to bail out the Treasury Department.

We believe this will be highly inflationary. After all, when the Fed created $5 trillion during Covid, we got 9% inflation. This time around they’ll most likely have to create $15+ trillion.

But this doesn’t mean the world is coming to an end. Rather, if we can anticipate inflation over the next few years, it means we can take steps now to minimize the impact.

And it just so happens that many fantastic inflation hedges are incredibly cheap right now, some even hovering near record lows.

More on this soon.

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If you saw Christopher Nolan’s blockbuster Oppenheimer, you might remember the scene in which Dr. Oppenheimer travels to Chicago to meet with physicist Enrico Fermi, who had just achieved the world’s first ever self-sustaining nuclear chain reaction.

This really happened– it was December 2, 1942, and Enrico Fermi’s experiment was a massive scientific breakthrough.

Fermi and his team proved that a fission reaction could be controlled… and therefore the vast amount of energy inside of an atom’s nucleus could be harnessed for other purposes.

Obviously, the US government was singularly focused on turning that immense nuclear energy into the biggest bomb the world had ever seen. But Fermi’s discovery also paved the way for nuclear power.

Proponents envisioned a world powered by nuclear energy where the cost of electricity would be practically free… and the benefits to mankind incalculable.

It all came down to efficiency; the amount of nuclear power that could be generated from a single rock of uranium was equivalent to thousands of tons of coal in a conventional power plant.

The cost of electricity would plummet. And that cheap energy would mean that consumers would pay far less for utilities, saving plenty of money that could be put to other uses.

Cheap energy also means that the production costs of just about everything would fall; cars, houses, food, etc. all become cheaper.

Cheap energy also helps countries develop more rapidly and increase economic growth, resulting in greater national prosperity and more tax revenue for the government.

The promise of nuclear energy was extraordinary– it was a win/win/win. So naturally when other nations began to develop the technology on their own, it set off an arms race to stockpile as much uranium as possible– mostly to ensure that no one else could make weapons.

The United States government bought up entire warehouses full of it and made an exclusive deal with the Belgian Congo (which had the world’s largest uranium reserves), simply to make sure that other countries couldn’t get their hands on any nuclear fuel.

Then, over the years, the US government slowly sold down its uranium inventory, little by little.

Mining companies also added new supply to the uranium market, ensuring there was plenty of uranium to meet growing demand.

But then a series of infamous accidents took place– Chernobyl, Three Mile Island, etc. The public freaked out, and the entire nuclear power industry nearly vanished.

Now, an objective analysis shows that, any way you slice it, far more people have died from accidents related to coal, oil, natural gas, and other forms of electricity production than have ever died from nuclear power accidents.

In fact, more people have died from accidents related to wind power than have died from nuclear.

But nuclear power still suffered a terrible blow to its reputation, and it remained that way for a very, very long time.

Power companies scrapped their plans for new nuclear power plants, and the demand for uranium collapsed, prompting many mining companies to shut down their operations.

The existing nuclear power plants that remained in business, however, continued buying uranium from the government… so those stockpiles from the 1950s continued to dwindle.

And that takes us to today: nuclear is finally making a comeback.

Unfortunately, most of the West (as usual) is missing the boat; the vast majority of new reactors will be in China, India, and other rapidly growing nations who understand that no other energy technology offers the same advantages as nuclear.

Western politicians are still stuck in their idiotic, Dark Age beliefs that wind and solar are the way to go. But these are both completely inefficient and extremely expensive technologies.

The amount of energy it takes to produce solar panels relative to the electricity that solar panels actually generate is a laughable pittance; this is known as ‘Energy Return on Energy Invested’, or EROEI… and with nuclear power, it’s off the charts.

Plus, nuclear power also has one of the lowest levels of CO2 emissions of any energy source.

(It’s also worth noting that emerging nuclear reactor technology promises to slash costs even further of establishing a new nuclear plant and increase safety even more.)

This means that nuclear has the potential to provide massive economic AND environmental benefits. Virtually no other technology has that capability… which is why it’s only a matter of time before the world ‘rediscovers’ nuclear.

Again, it’s already happening in Asia. In fact, it’s possible to literally count all the planned / in-progress nuclear power plants that will be coming on line in the next few years, and then estimate the annual uranium demand.

One of the best researchers in this field, by far, is my colleague Adam Rozencwajg, who has spoken at a few of our Total Access events; Adam has gone through the trouble to count up all the new reactors and their projected uranium needs, and the answer is very clear:

Bottom line, uranium demand is set to skyrocket. Yet supply isn’t going anywhere, not for a while.

It takes many years to get a new uranium mine up and running– sometimes even longer than it takes to build a new nuclear power plant.

So, you can see how there’s likely going to be a massive imbalance in uranium supply and demand.

I first started talking about uranium in September of 2022 when spot prices hovered around $40 per pound.

Today, uranium trades for more than $90 per pound. But I think it could go much, much higher from here.

In fact, global uranium demand already exceeds new mining production. In the past, whenever this happened, there were always vast government stockpiles to keep the power plants supplied.

But now the government stockpiles have dwindled. So, we could easily see a major uranium shortage… and prices go through the roof.

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At 3:15 in the morning on May 10, 1774, King Louis XV of France passed away after a grueling, two-week battle with smallpox.

Upon hearing the news, his heir and grandson– 19-year old Louis XVI, reportedly cried out, “God protect us, I am too young to rule. . . I have learned nothing and the universe will fall upon me.”

But the new young king did manage to make at least one very bold decision almost immediately: he appointed a controversial French economist named Turgot to head up the nation’s finances.

Everyone knew by 1774 that France was in serious trouble. The national debt had soared to a record high thanks to so many years of war, extravagant spending, corruption, and blatant mismanagement.

Annual interest payments on the debt were becoming so vast that France had to borrow more money just to pay interest on the money they had already borrowed. And lenders were becoming increasingly worried that the government would default.

As a result, interest rates rose considerably. Investors who loaned money to the French government demanded rates as high as 12% to compensate themselves from the risk of potential default.

Louis XVI knew that this was completely unsustainable, and that France was headed for a major crisis if the government didn’t take urgent action to reverse course.

And that’s why he hired Turgot– possibly the only person in the kingdom with the balls to do what was necessary.

It wasn’t rocket science; Turgot knew exactly what needed to be cut. It was obvious:

By the early 1770s, the court at Versailles included the entire royal family, along with a whopping 886 aristocrat freeloaders– plus their wives and children. Add to that number 295 cooks, 56 hunters, 47 musicians, plus various other secretaries, chaplains, physicians, and other entourage, plus thousands of guards to protect everyone.

In total the royal court had over 16,000 mouths to feed, not to mention the handsome salaries paid to all of these useless officials.

The annual pensions alone, which were paid just to a handful of the king’s closest friends, consumed more than TEN PERCENT of the government’s annual budget.

But on top of this blatant spending problem, France also had a productivity problem. High taxes, excess regulation, and government price controls virtually eliminated any incentive to produce. Plus businesses faced endless battles with the guilds, which were essentially the unions of that era.

So, when Turgot was charged with fixing the country’s financial woes, he knew exactly what to do. And he sketched out his plan to the king the very night that he was appointed:

“In the present moment, I confine myself, Sire, to call to your recollection three ideas: No national bankruptcy. No increase of taxes. No new loans. . . To obtain these three points there is but one method– that of reducing the expenditure. . .”

Turgot knew that the economy needed to become more productive, so he wasn’t willing to raise taxes. He wouldn’t cause a financial crisis by defaulting on the debt. And he certainly wasn’t going to increase the debt by borrowing more money.

The solution was obvious, and Turgot got to work almost immediately.

With the King’s support, he made deep, deep cuts to the royal court. He also liberated trade and commerce by taking power away from the guilds, eliminating price controls, and reducing regulation.

And it worked. By the end of 1775, Turgot had balanced the budget and restored France’s creditworthiness such that he was able to refinance a large portion of the French debt with foreign investors at a rate of just 4%.

He turned everything around in just barely a year.

Unfortunately for France, however, Turgot had made a lot of enemies. The nobles, the guilds, and even the church hated him. So, on May 12, 1776, the King gave in to the pressure and fired Turgot. France then quickly resumed its decline.

The larger point is that it is possible to turn a giant ship around. France was in dire straits when Turgot took over. But he managed to reverse course in a year.

The US is now at a similar point (though frankly much worse) as when Turgot took over French finances.

France’s budget deficit in 1774 was roughly 10% of total tax revenue, while the budget deficit in the US last year was closer to 40%. Nevertheless, it’s still possible for America to turn things around.

And just like France in 1774, the answers are obvious. Turgot knew that every other government expenditure combined paled in comparison to France’s #1 cost: the royal court.

Similarly, everything else in the US government budget combined pales in comparison it its #1 cost: entitlement spending.

Obviously, there is plenty of fat to trim everywhere in the US government; the Defense Department routinely wastes tens of billions of dollars, let alone the billions wasted in other departments.

And while those cuts would be helpful, they won’t amount to anything unless the #1 issue is tackled.

Entitlement spending, which includes Social Security, Medicare, and various welfare programs which the government now politely calls “income security”, cost a whopping $3.75 TRILLION in Fiscal Year 2023. This is the obvious place to start.

But Joe Biden made it very clear in last night’s State of the Union that he has absolutely no intention of doing that.

He could have been honest. He could have leveled with voters that there is almost no chance of balancing the budget without obvious entitlement reform… and that failing to balance the budget will result in an existential financial crisis.

At a minimum he could have said nothing.

But instead, he specifically ruled out entitlement reform (for the second year in a row) and explicitly said, “If anyone here tries to cut Social Security or Medicare or raise the retirement age I will stop them!”

Now, Joe Biden may think that he’s doing the right thing. But this is classic Inspired Idiocy.

When Hawaii’s Supreme Court recently ruled that the “Spirit of Aloha” takes precedence over the second amendment, they thought they were doing the right thing. Or when the FTC sued last week to block a grocery store merger, they thought they were doing the right thing.

Even the eco-terrorists who sabotaged a Tesla factory in Germany this week believe they’re doing the right thing.

Inspired Idiots always think of themselves as righteous. Unfortunately, they’re completely misguided and almost always wrong. They understand nothing, but they’re really passionate about it.

And that’s the danger.

This coming fiscal crisis is completely avoidable if the people in charge would simply take it seriously. But the President pledged last night that he will do absolutely nothing to stop it, and in fact continue making it worse.

The good news is that, while the Inspired Idiots in charge keep steering the country directly into the crisis, individuals can take rational steps to mitigate the worst consequences… and potentially even benefit from the opportunities that arise.

That’s why it’s so important to have a clear understanding of these obvious risks, and to have a Plan B.

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Carolyn Maloney must be furious.

This career politician with five decades of experience, as I wrote in at the very beginning of the year, was the chief architect of a completely ridiculous law known as the Corporate Transparency Act (CTA) which went into effect on January 1^st.

The CTA was one of the dumbest pieces of legislation I have seen in a very long time. The entire premise is the classic boogeyman story that evil criminals and terrorists use US corporations to conduct their illicit activities.

This is the same lame excuse that politicians use to sh*t all over crypto.

And of course, it’s partially true. Sometimes criminals and terrorist do use US corporations and LLC structures to launder money. Sometimes they use crypto.

But criminals and terrorists also use JP Morgan Chase, HSBC, Visa, Mastercard, American Express, PayPal, US government bonds, Amazon gift cards, Verizon Wireless, iPhones, and Ford F-150 pickup trucks.

It’s not clear to me why politicians like Carolyn Maloney insist on calling out specific assets like cryptocurrency… or now US corporations/LLCs. But hey, these people have decades of experience, so they must know what they’re talking about.

(As an aside– how many people in this world are so good at what they do that they keep their jobs for decades? Even championship sports coaches and highly successful CEOs eventually get canned for poor performance. But politics is teeming with people who never seem to get fired…)

When the CTA went into effect earlier this year, I also pointed out that the US already has dozens of laws and regulations on the books which are supposed to prevent money laundering and financial crime.

But apparently Congress didn’t think those laws were effective enough… so they created a NEW law, i.e. the CTA. Naturally they didn’t bother repealing the old, ineffective laws. They just piled on more rules.

And this is how the government almost always operates. They don’t repeal stupid laws or destructive regulations. They just keep adding more and more each year. That’s why the Code of Federal Regulations goes on for roughly 200,000 pages.

Of course, it’s YOUR responsibility to keep up with all of these rules. As the old saying goes, ignorance of the law is not an excuse.

You’d think that the government would have at least invested some money in a public awareness campaign to inform the American public about this law, given that it impacts literally tens of millions of people.

But they didn’t do that. They passed the law and said nary a word about it when it went into effect in January. The only thing they DID do was impose a harsh penalty for non-compliance: up to two years in federal prison.

Perhaps the even more bizarre part about the CTA was that it is completely redundant.

The law requires EVERY small business in America to file a special report with the federal government– specifically the Financial Crimes Enforcement Network (FinCEN)– as if it’s some sort of crime to own a business anymore.

And I say ‘small business’ deliberately, because the CTA does not apply to big businesses, Wall Street banks, etc. It specifically targets the little guy.

The report is just a bunch of personal information about the owners, officers, and directors of the company. Names, addresses, that sort of thing.

This is the exact same information that taxpayers already have to provide to the IRS. So, the CTA just doubled the requirement to provide a similar report (but in a different format) to a different agency.

In sum, politicians think that criminals use US companies to launder money. There are already laws on the books to prevent criminals from doing this.

But rather than repeal and replace the inefficient laws, they piled on a new law which requires small businesses to submit a new report to FinCEN, even though the report contains the exact same information taxpayers already disclose to the IRS. Noncompliance is punishable by up to of two years in federal prison. But they didn’t say a word about it to anyone.

Such is the genius of people with decades of experience in politics.

Well, a few days ago we received a little ray of sunshine from a federal judge, who ruled that the Corporate Transparency Act is flat-out unconstitutional and goes beyond “the limits imposed by the Constitution on the legislative branch”.

This is absolutely a victory for sanity… and exactly the sort of thing we would want to see in the US.

As I’ve written so many times, the US is on a path to obvious financial ruin. The national debt is already $34+ trillion, and the government itself forecasts another $20+ trillion in new debt over the next decade.

It won’t be long (5-7 years at best) before the rapidly growing annual interest bill on that mountain of debt becomes an unaffordable catastrophe.

And the only realistic way out of this mess is for the US economy to be firing on all cylinders, with maximum productivity and efficiency. The more productive the economy, the greater the government’s tax revenue… which helps reduce the deficit and alleviate the debt pressure.

Laws like the CTA are a step in the wrong direction; it’s just pointless, time-wasting, money-wasting bureaucracy that makes people and businesses LESS productive.

So, the fact that a judge ruled it unconstitutional is a good thing.

The federal government, of course, will most likely appeal the decision. (Or they’ll simply ignore the court’s ruling altogether, which has been a popular approach with the Biden administration.)

So, if you haven’t filed your CTA report yet, you might consider waiting a little while longer to see how this plays out. There’s still plenty of time before the December 31^st deadline, so it’s unlikely anyone will be hauled off in shackles anytime soon for not filing.

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It’s hard to say with a straight face that an asset hovering near its all-time high could be a “contrarian” investment. But I’m going to say it anyhow– I think gold may be a contrarian play right now.

Now, it would be easy to assume that gold is near its all-time high because everyone is buying. And normally that would be true; typically, whenever an asset soars to a record high, it’s because individual investors are piling into the market.

We’ve seen this countless times, from Bitcoin to meme stocks; once something becomes the hot thing to own, small investors– and occasionally professionally managed funds– drive the price higher.

But that’s not happening with gold. In fact, investors have been abandoning gold for years.

Publicly available data from more than 100 gold ETFs (all of which are conveniently aggregated by the World Gold Council) show that western investors have been selling off their gold ETFs for most of the past few years.

WGC data show that North American and European investors dumped over 700 metric tons of gold since May of 2022, equivalent to nearly 20% of ETF holdings.

In fact, outflows for the month of January alone (the most recent month of published data) totaled more than 50 metric tons– the second highest outflow in a year.

Most notably, however, North American, and European investors dumped 179.6 metric tons of gold September 2023 through January 2024.

This is important, because during that time period, the price of gold surged from $1820 per ounce to nearly $2100.

Strange, right? If investors were selling off substantial quantities of gold, it seems like the price should have fallen. Instead, it rose 15%. How is that possible?

Well, the reason that gold keeps going higher is because, while individual investors are selling, there’s another group that’s buying.

In fact, this group of buyers is completely price insensitive. They don’t care how much they pay per ounce. They are not even looking for a return on investment. And they have mountains of cash to spend.

The group of buyers I’m talking about is central banks and governments.

And not just the usual suspects like China and Russia either (though China did buy more than 200 metric tons in 2023). Other like Poland, India, Singapore, Czech Republic, Philippines… and even Iraq.

To me this is an obvious signal that the global financial system is probably going to change sooner rather than later. And long-time readers know we have been writing about this for years.

Reserve currencies throughout history have always come and gone.

There was a time when the Greek drachma dominated trade and commerce in the Mediterranean (due in large part to the conquests of Alexander the Great). It was displaced by the Roman denarius, then the Byzantine gold solidus, then the Venetian ducat.

Reserve currencies rise to prominence because people have confidence in the issuer, i.e. the Roman Empire, or the Republic of Venice, or the Spanish Empire.

But eventually that confidence wanes– especially as the empire debases its currency and runs up massive debts.

That’s the situation the United States is in right now.

The national debt is already $34.4 trillion. And the Congressional Budget Office expects it to rise by at least $20 trillion over the next decade.

The dollar became the global reserve currency back in 1944 when there were no other nations to rival the US.

The US was the only country that hadn’t been completely obliterated by war. It boasted the largest, freest, most productive economy. It possessed the best technology and manufacturing capacity. It had the largest pool of savings.

And it also had one of the world’s largest and most rapidly growing populations.

Yet even with such an impressive socioeconomic resume, the rest of the world wasn’t willing to blindly trust the US government with the world’s reserve currency… not without first putting some critical checks and balances in place.

First, while other nations agreed to fix their currencies to the US dollar, the US agreed to fix the dollar to gold at a rate of $35 per troy ounce.

And second, the US government had to guarantee that the dollar would be freely convertible to gold; that way, if any nation ever lost confidence in the Treasury Department or Federal Reserve, they could easily redeem their dollars for gold.

This is a pretty critical point to understand: immediately following World War II, the US was at the peak of its power. Every other developed nation on earth had been devastated by the war. Farms and factories had been destroyed. Chaos and hunger were rampant. Entire governments had been toppled.

Yet even with such a tremendous power imbalance (i.e. the US was in pristine condition compared to Europe), allied nations still weren’t willing to go all-in on the US dollar. And they demanded the gold convertibility as a guarantee.

That was 80 years ago. And it’s safe to say that the US is nowhere near the peak of its geopolitical power anymore. Adversary nations are everywhere, and the US government’s finances are an embarrassing catastrophe.

When I see central banks buying up gold at record high prices, this suggests to me that they are preparing for a new global financial system– one that is based on gold instead of the US dollar.

After all, this is the most logical scenario.

It would be naive (and deliberately ignorant of history) to believe that the dollar will go on indefinitely as the world’s dominant reserve currency, given the pitiful trend of US government finances. Even the IMF has called for a reset in the global financial system.

It’s also hard to believe that any new financial system would be centered on a Chinese currency; no one trusts the CCP, nor should they.

Gold is the most viable option to replace the dollar as the global reserve because it doesn’t require any convincing. Governments and central banks all over the world already own gold, just as they have for thousands of years.

And it’s a lot easier for everyone to have confidence in an asset class that no single nation controls.

Given the trend of their large-scale gold purchases, it appears that foreign governments and central banks may be preparing for this potential new financial system.

I’ve argued before that a gold-based financial system could send prices beyond $10,000 or more.

So, yes, even though gold is near a record high, it’s important to remember that individual investors are selling at a time when central banks are gobbling it up even more quickly.

And it’s possible they’re buying for a very deliberate reason.

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In the year 1218 on the great plains of central Eurasia, a Mongolian trade caravan was on a long expedition across the Silk Road when it reached the city of Otrar in the Khwarazmian Empire (modern day Kazakhstan).

The governor of the local province– a career politician named Inalchuq– was suspicious of the Mongol traders and thought they might be spies… so he had them all killed. He also confiscated their property, which included plenty of luxurious silk, furs, and precious metals.

Unfortunately for Inalchuq, one of the traders managed to escape, and he rode his camel all the way back to Mongolia to inform Genghis Khan what happened.

The Khan was furious. And the following year, in the autumn on 1219, he laid waste to the city of Otrar, then ultimately the entire Khwarazmian Empire.

It was one of the most brutal military campaigns in history. And for Genghis Khan, it wasn’t even really a war as much as it was personal vengeance. And he turned it into a massacre; modern historians estimate the death toll at nearly 6 million– the vast majority of whom were Khwarazmian.

Genghis Khan razed entire cities to the ground. He slaughtered women and children. He killed family members who were only trying to bury their dead. He even executed cats and dogs.

It finally ended in 1221 when Genghis Khan decided that he had waged sufficient destruction, at which point he returned to China.

Eight centuries later, in the spring of 2021, another Khan would rise to power in Washington DC. And while her methods are non-violent, they are, at least from an economic perspective, potentially even more destructive than Genghis.

This new Khan’s name is Lina Khan. And she is the head of the Federal Trade Commission, the US government agency whose charge is to regulate big business.

Now, the FTC was originally created more than a century ago back when vast monopolies (like Standard Oil) dominated critical industries. So, in response to public outcry, the government set up a special agency to investigate and prosecute monopolistic businesses who were “likely to cause substantial injury” to consumers.

That’s been the primary mission of the FTC for more than 100 years; they’re supposed to be independent professionals who seek balance between capitalism and consumer protection.

They don’t always get it right. And the agency has gone through periods in its history where it has been more aggressive, and other periods where it’s been ‘hands off’.

But under the stewardship of Lina Khan, the FTC has completely transformed from a non-partisan, non-political, professional regulator… to radical, Marxist activist.

First and foremost, Lina Khan has zero business experience. She’s an academic whose entire university career was spent trashing big business.

She wrote a number of papers as an Ivy League professor, for example, suggesting that the FTC should invent new authority for itself in order to sue some of the largest companies in America.

A reasonable person probably wouldn’t have chosen someone with zero business experience (and who hates big business) to lead the FTC, i.e. government’s chief regulator for big business.

But Joe Biden isn’t a reasonable person. So 34-year-old Lina Khan was his #1 choice.

And right from the start, Lina Khan has gone full Genghis on American business.

There are the usual suspects, of course, like Microsoft, which the FTC sued in 2022 after the software giant announced a deal to acquire video game maker Activision Blizzard.

(Khan’s case against Microsoft was so ridiculous that even the highly liberal federal judge from Northern California– who was appointed by Joe Biden– ruled in favor of Microsoft.)

But her latest target is truly one for record books.

Earlier this week Lina Khan’s FTC announced a lawsuit to block a proposed merger between two grocery store chains: Albertsons and Kroger.

The crux of Khan’s argument– which she offers zero evidence to substantiate– is that the merger “may lead to higher prices and reduced services for consumers.” She also blasts both companies, insinuating that they are unfairly profiting from higher food prices while Americans suffer the effects of inflation.

This is classic Inspired Idiot; this woman has absolutely no idea what she’s talking about.

Anyone who understands even the basics of finance can see that grocery store profitability is DOWN substantially since inflation kicked in.

Kroger’s gross profit margin was already razor thin at about 3% back in 2019 before the pandemic. When inflation spiked, it fell to the 1% range. That’s almost nothing.

These stores aren’t unfairly profiting; inflation has made them LESS profitable.

There’s also a lot more competition than there used to be. Tech companies (like Amazon) have cut in on their business. Consumers are turning to farmers markets and coops. There’s a lot more choice out there… I mean, food literally grows on trees.

So, it’s totally naive to assume that the merger of two companies will result in higher prices. If anything, the merger should result in LOWER prices.

The point of the merger is to find synergies and cut costs… which would allow them to remain competitive and pass along the savings to consumers in the form of lower prices.

Yet Ms. Khan’s 24-page court filing demonstrates a kindergartner’s understanding of finance, business, and economics. I actually laughed out loud several times as I read it.

At one point, for example, Ms. Khan cites seven different times that either Kroger or Albertsons acquired another grocery store chain. Yet– quite bizarrely for Ms. Khan– ZERO of those instances resulted in higher food prices.

It’s almost as if she is arguing against herself.

But that’s the way these Inspired Idiots always operate; they don’t have a clue what they’re talking about, and their arguments make no sense. All they know is that they’re enraged, and they think their actions are saving the world.

Bear in mind that grocery store chains like Kroger actually provide something of value. Even during the government’s most horrific lockdowns in 2020, they still managed to provide food for hundreds of millions of people every single day. That’s hard to do.

Lina Khan has never done anything close to that in her entire life. She creates nothing. She can only tear down what other people have built.

And there’s a significant cost to her fanaticism.

I’ve written countless times that the US is in deep financial trouble thanks in large part to the government’s endless deficit spending.

Working out of this problem requires maximum productivity; US economic growth needs to be at least 3% to 4% on a sustained basis…

Breaking up mergers, stopping acquisitions, and frustrating American businesses with fanatical legal action doesn’t help. It only hurts. It takes the country in the wrong direction.

So does bad leadership.

An internal government investigation shows that Khan has consistently mismanaged government resources and abused her authority. Career professionals within the FTC believe that she is “making decisions for headlines” as opposed to following the law.

The investigation also finds that the FTC is “beset by dysfunction and chaos stemming from poor leadership and ideological bullying of its Chair and her leadership staff. These findings reinforce the results of repeated government-wide surveys that found the FTC to have a toxic work environment under Chair Khan.”

Lina Khan’s reign at the FTC could easily cost tens of billions of dollars in lost economic activity… which might rival Genghis.

At least Genghis eventually got bored of waging so much destruction, and in the year 1221 he went back to China. We can certainly hope that Ms. Khan will do the same.

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Almost one year ago to the day– on February 24, 2023– Silicon Valley Bank released its 2022 annual report. And senior executives must have been pretty nervous since the report showed that the bank was nearly insolvent.

The bank had acquired a massive portfolio of more than $100 billions of US government bonds– supposedly the ‘safest’ asset class in the world– during 2020 and 2021 back when interest rates were at historic lows.

But then the Fed started hiking rates very quickly in 2022. And higher rates cause bond prices to fall– even the ‘safest’ ones like US Treasury bonds.

By the end of 2022, Silicon Valley Bank’s portfolio of US government bonds was down by more than $15 billion. And with barely $16 billion in total capital, Silicon Valley Bank was nearly wiped out.

Their 2022 annual report communicated this insolvency risk very clearly. And the bank’s leadership must have probably been expecting the stock to crash almost immediately.

And yet it didn’t. After the annual report was released and all the ‘experts’ on Wall Street had a chance to see the alarming data, Silicon Valley Bank’s stock price barely budged.

Then, just ten days later, the Chairman of the Federal Reserve testified to Congress that the Fed’s rapid interest rate hikes presented absolutely zero risk to the financial system:

“Nothing about the data suggests to me that we’ve [raised rates] too much. . .” he said.

Of course, the Fed’s rapid interest rate hikes were precisely the reason why Silicon Valley Bank’s bond portfolio had lost so much value.

But again, neither Wall Street nor the Fed (which, as a financial regulator, had unfettered access to Silicon Valley Bank’s real-time financial condition) thought there was any risk whatsoever.

We know what happened next, and Silicon Valley Bank collapsed within a week.

But there’s now a new, and even more bizarre chapter to the story.

Typically, when banks in the US fail, one of the federal banking regulators (usually the FDIC, or Federal Deposit Insurance Corporation) steps in to take over.

And that’s what happened with Silicon Valley Bank: the FDIC took over operations almost immediately to try and sort out the mess.

Bank restructurings, however, are almost always chaotic. They take time. The FDIC must liquidate assets in an orderly manner to maximize the value of the balance sheet, then prioritize claims against those assets.

Depositors obviously need to be paid. Creditors and lenders want their money too. And so, of course, does the government.

It turns out that Silicon Valley Bank also owed a tax bill to the IRS… $1.45 billion to be exact.

And since the FDIC became the legally responsible party of Silicon Valley Bank, the IRS went knocking on the door of its fellow government agency to ask for the money.

The FDIC refused.

In fact, according to the FDIC, they owe absolutely zero tax and will pay nothing.

Hilarious, right? This is literally government agency versus government agency in a dispute over taxes. And they can’t even settle the matter like grown adults, so the case is now going to federal court.

This raises an obvious point: if even a government agency like the FDIC is going out of its way to minimize its tax bill, then why shouldn’t everyone else?

There are way too many hard-core Marxists in the United States these days who insist on higher taxes, new taxes, punitive taxes. Activist groups like Pro Publica have published the illegally acquired tax returns of wealthy Americans in an effort to shame people… as if following the tax code and taking completely legitimate steps to reduce what you owe is some mortal sin.

But this case between the FDIC and IRS only proves the point made by Judge ‘Learned’ Hand decades ago, that “Anyone may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury.”

Taking legal steps to reduce your taxes is completely sensible. And frankly tax reduction isn’t even part of a Plan B; it should be Plan A!

Fortunately, there are plenty of ways to do this. In 2024, for example, you can reduce your taxable income by $23,000 (or $27,000 if you’re 50 or older), through pre-tax contributions to a Traditional 401(k).

For those who are self-employed or have a side business, a solo 401(k) allows an even greater tax-free contribution of up to $69,000 (and $76,500 for those aged 50 or older).

Plus, you have more freedom to invest your money as you see fit– real estate, crypto, and more.

And while you do eventually have to pay taxes when you withdraw the funds in retirement, most retirees will be in a lower tax bracket at that point. Plus, your investments will have grown and compounded tax-free for that entire time.

If you’re willing to move across state lines, you can reduce or eliminate state and local taxes. If you are willing and able to move abroad, you can potentially eliminate federal taxes as well.

For US citizens living abroad, the Foreign Earned Income Exclusion (FEIE) allows you to earn up to $126,500 as an individual, or $253,000 as a couple, tax-free (though this does not include investment income).

Plus, you can exclude even more as a housing expense, which varies depending on where you live overseas.

And for people who move to Puerto Rico, as both myself and my partner Peter Schiff did, tax rates go down to 0% on capital gains, and just 4% on business income.

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Early in the spring of 1956, only weeks after Elvis Presley released his debut studio album, and actress Norma Jean Mortenson had her name legally changed to Marilyn Monroe, a budding 25-year-old businessman from the American Midwest fatefully registered his first-ever company.

His name, of course, was Warren Buffett. And the company he founded was called Buffett Associates– which was formed with $105,000 of capital from his friends and family.

The US economy at the time was absolutely booming. Interest rates in 1956 were at historic lows. Inflation was practically zero. Economic growth was a dizzying 7%. Productivity growth was strong.

The US was no longer at war. And the national debt– which had reached a peak of 120% of GDP in the 1940s due to the costs of World War II– had been cut in half… and was falling further each year.

America was proudly capitalist, and the government actually made sound and effective investments, like the US federal highway system. Businesses reaped the benefits: corporate earnings across the S&P 500 index soared.

Yet, at the time when Buffett formed his business in 1956, stocks were still cheap… trading at less than 12x earnings (versus nearly 30x today).

It’s hard to imagine better economic or market conditions: a high growth, capitalist economy with low inflation, low debt, high productivity, and cheap stocks? Buffett could have hardly picked a better time to get started.

And, although there were plenty of ups and downs along the way, those pristine conditions lasted throughout the first several decades of his career.

Buffett is obviously one of the most talented investors to have ever lived, and he surrounded himself with other incredibly talented people.

But (and he would probably be the first to admit) his success would not have been as great without the power and dynamism of the US economy behind him.

And this is why Warren Buffett has long been one of America’s biggest economic cheerleaders.

Over the past 15+ years, Buffett has had an insider’s view of some very concerning trends. The US national debt has been rising out of control. The Federal Reserve has made a mess of the dollar. Woke fanatics have hijacked capitalism.

Yet through it all, Buffett has maintained a calm, persistent optimism in America; he routinely dismisses concerns over the debt, or the dollar, or the future of the US economy, and has seemed to believe that nothing could ever derail American progress.

But as I read through his annual letter this past weekend, it seems that even Buffett’s legendary optimism is starting to crack.

First, it’s clear that even Buffett thinks that government regulation has gone way too far.

Buffett explains, for example, that utility companies were “once regarded as among the most stable industries in America” because of their consistent profitability.

Yet he laments that the utility companies he acquired were a “severe earnings disappointment” in 2023 due to over-regulation from fanatical politicians.

Buffet complains that “the regulatory climate in a few states has raised the specter of zero profitability or even bankruptcy (an actual outcome at California’s largest utility and a current threat in Hawaii).”

“In such jurisdictions,” he writes, “it is difficult to project both earnings and asset values in what was once regarded as among the most stable industries in America.”

In the end, he tells shareholders that he “did not anticipate or even consider the adverse developments in regulatory [changes] and . . . made a costly mistake in not doing so.”

He goes on to talk about America’s dilapidated infrastructure, which is in critical need of maintenance and reinvestment. And Buffett cites the case of BNSF Railway (the largest freight rail in the US) which he acquired in 2009.

BNSF, he explains, has had to spend tens of billions of dollars to fix up its rail network “simply [to] maintain its present level of business. This reality is bad for owners. . .”

But it’s not just BNSF. And it’s not just railways. Almost ALL infrastructure in the US is in serious need of repair.

Obviously, the US government made a halfhearted attempted to address infrastructure challenges when it passed a $1 trillion investment package in 2021. But “the consequent capital expenditure” that’s truly required to fix it, Buffett writes, “will be staggering.”

One final point worth mentioning is Buffett’s comments on size. Again, when he started his first partnership in 1956, he only had $105k to invest, and he could move nimbly in and out of the market.

Today, Buffett’s company has almost $170 billion in cash, which is virtually impossible to manage efficiently. He writes that it’s “like turning a battleship”, and that the days of being quick and nimble “are long behind us; size did us in…”

Buffett, of course, is talking about his own company (Berkshire Hathaway). But the same could just as easily be said for the US government.

Think about it– if someone of Buffett’s extraordinary talent admits that he cannot efficiently deploy $170 billion, how are Joe Biden or Transportation Secretary Pete Buttigieg supposed to be able to invest that $1 trillion infrastructure money?

Quite poorly, I’d imagine.

Buffett does acknowledge that “America has been a terrific country for investors.” And he’s absolutely right. It still is, for the most part.

Nvidia is an easy example: it simply would not have been able to achieve the same level of success had it been based in most other countries. If Nvidia were a Chinese company, for example, it would have been taken over by the CCP long ago, and CEO Jensen Huang would have probably been disappeared.

But one of the most important caveats of investing applies to the US economy as well: “past performance does not guarantee future results.”

Warren Buffett enjoyed some of the most pristine economic conditions imaginable for the vast majority of his nearly 70-year career. And as I have written several times, it is absolutely possible that America’s best days are still ahead.

There is clearly a future scenario in which small-scale nuclear reactors generate clean, low-carbon, ultra-cheap energy which powers highly productive AI and robotic automation. Economic growth is off the charts, and tax revenue soars as a result. The national debt eventually melts away, and the US re-establishes its primacy by out-producing and out-innovating the competition.

But at the moment there are serious issues to contend with.

US productivity is anemic. So is economic growth. War, inflation, cyberattacks, border crisis, social conflict, the rise of adversary nations, decline of the US dollar’s dominance, etc. are all pervasive challenges.

(Not to mention potential near-term consequences– like the impact of Russia, China, North Korea, and terrorist groups sending so many of their operatives across the southern border.)

The government not only isn’t fixing these problems, but they seem to be making them worse by the day.

So, it’s important to take notice when even someone as optimistic as Buffett starts complaining.

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It’s not exactly as if the world is swimming in a sea of tranquility these days.

War in Gaza has been raging for months. War in Ukraine has been raging for years. And Russia has even threatened using nuclear weapons.

Terrorist groups brazenly attack American shipping vessels.

Iran keeps stirring the pot by shipping weapons and cash (most of which has been provided by the US) to belligerents around the world.

China continues to insist that it will “reunify” with Taiwan by force if necessary, and demonstrates its resolve for war by bombing mock-ups of US ships.

Now, the world has been in far worse shape in the past. And history shows that it is possible to pull back from the brink of almost certain conflict— the Cuban Missile Crisis is a great example.

But putting out all these fires requires serious, experienced professionals who can be laser-focused on achieving their nation’s diplomatic priorities from a position of strength.

Yet apparently the US State Department has a far higher calling than achieving peace through strength: gender neutrality.

US Secretary of State Antony Blinken recently sent a memo to State Department employees entitled, “Modeling DEIA [Diversity, Equity, Inclusion, and Accessibility]: Gender Identity Best Practices.”

The memo informs State Department employees that they should use “gender-neutral language whenever possible” because gendered terms such as “manpower”, “you guys”, “ladies and gentlemen”, “mother/father”, “son/daughter”, and “husband/wife” can be offensive.

Offensive to whom, exactly?

Does the US Secretary of State honestly believe that the word “father” is in any way offensive to the people with whom they have to negotiate?

Are Hamas terrorists triggered by the term “husband”? Will Ukrainian soldiers be outraged for praising “the brave men and women” who are fighting on the front lines?

Obviously not.

Terms like “father” and “mother” are only offensive to a tiny, tiny group of silly extremists in the US who have nothing better to do than wake up every morning and find an excuse to live in a state of perpetual victimhood.

But apparently the State Department is teeming with these whiny perpetual victims… which is pretty terrifying given the state of the world today.

Rather than focus on promoting strength, peace, and stability, there are ostensibly American diplomats who are more concerned about not being triggered by gender-specific words that have existed in the English language for more than 15 centuries.

Now, bear in mind that the entire purpose of the State Department is to interact with officials in other nations, who obviously tend to speak different languages. Yet many of these gender-neutral terms don’t even translate.

In Spanish, for example, mother is la madre and father is el padre. And if you’re referring to both parents, or you’re not sure which one, native speakers say padre, i.e. father.

There is no genderless word for parent in Spanish. It simply doesn’t translate.

So what exactly is the point of using this new genderless woke newspeak when it cannot even be communicated to foreign diplomats?

Now, I’ll return to the State Department soon. But I also want to tell you about a 90-year old woman named Fran Itkoff who was recently fired from her job.

Fran (who appears incredibly youthful at 90) has spent the last six decades volunteering for the National Multiple Sclerosis Society. That’s a long time.

Yet the organization recently implemented a new Diversity and Inclusion policy in which staffers must include their pronouns, i.e. she/her, at the end of an email.

Fran didn’t understand the policy and asked why putting ‘she/her’ was inclusive? It’s certainly a reasonable question.

But “why” is the most triggering word of all to Diversity & Inclusion fanatics. They have no answers, they have no logic. So they respond with rage.

90-year old Fran Itkoff was fired— as a volunteer— for asking why.

Her story started making the rounds online, so National Multiple Sclerosis Society subsequently issued a bizarre apology, which stated that, even though “Fran has been a committed champion of [the Multiple Sclerosis] cause” for six decades, they fired her “with the best intentions”.

You just have to laugh at these people. I mean, it’s obvious that the Multiple Sclerosis society cares more about pronouns than they do eradicating Multiple Sclerosis! How does this organization expect anyone to take them seriously?

But the same question applies to the State Department. By publishing this memo, the Secretary of State has made it very clear what his Department’s priorities are.

How does he expect Iran, Hamas, Saudi Arabia, Russia, China, etc. to take him seriously?

Remember, we’re not talking about a mid-sized non-profit or some random Congressman. This woke newspeak is now official guidance at the US Department of State.

I’ve written extensively that the United States faces a mountain of extraordinary challenges, from geopolitical threats to the southern border crisis to the looming national debt catastrophe.

These problems are not unsolvable. Not yet. But there is only a narrow window of opportunity— probably five years at best— to get back on track.

Unfortunately the Inspired Idiots in charge keep making things worse.

And this is a perfect example: by publishing this memo, the Secretary of State weakened America’s position in front of its adversaries. He made things worse, not better.

Obviously they don’t believe they’re making anything worse. They think their crusade for justice makes the world a better place. But they’re clearly out of touch with reality,.

And Fran Itkoff’s case is a great explanation:

Remember that the National Multiple Sclerosis Society’s new policy requires staffers to put pronouns in their emails, because stating pronouns = inclusive.

Yet the State Department’s newspeak memo states that you should not “pressure someone to state their pronouns” because it is “problematic” and sends a “harmful, exclusionary message”.

Wait, so which is it? Are we supposed to demand people state their pronouns or aren’t we?

It’s all so confusing… pronouns cannot be simultaneously “inclusive” and “exclusionary” at the same time, can they?

Well, in the Shrodinger’s Cat logic of Inspired Idiots, of course they can!

And that’s part of this 1984-style newspeak. Nothing has any fixed meaning. Everything is arbitrary and open to interpretation. There is no structure, there is no order. It’s all fluid and ever-changing… just like their definition of gender.

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