Category: simonblack

My sister used to be a reporter for Fox News based in south Florida and would regularly be assigned to cover NASA press conferences.

And she’s often told me about how reporters were terrified to ask any real questions. They’re not astrophysicists and don’t understand the first thing about rocket propulsion, and most of the journalists never bothered to learn even the basics of the topic.

So, the majority of the questions were very superficial; quite simply the reporters didn’t want to embarrass themselves.

This is how the media covers the Federal Reserve. Most reporters don’t have a clue about central banking, so, not wanting to look stupid, they just sit quietly and give the Fed a pass. There’s no real scrutiny.

At the same time, Fed officials are generally in lockstep with one another; it’s not like politics where the two sides constantly chastise one another. With the Fed, there is virtually no public dissent.

Even former Fed officials who have long left the bank maintain an almost mafioso code of silence.

The end result is that no one really criticizes the Fed. And because of this, the Fed has been able to cultivate a reputation that they’re in total control of the situation… even though their track record proves the opposite.

The Fed completely failed to predict inflation in 2020 after engaging in record money printing. Then they missed the warning signs in early 2021, then misdiagnosed inflation as “transitory” in late 2021, then still failed to act until early 2022.

Yet despite such failures, the Fed is still sticking to the narrative that they know what they’re doing. And with hardly anyone challenging them, it’s been easy to maintain a veneer of omnipotence.

But Kevin Warsh broke ranks this weekend. As a former Fed governor, he is the ultimate insider… and he penned an editorial published in the Wall Street Journal on Saturday blasting many of the Fed’s decisions.

Warsh describes how, when he joined the central bank in 2006, its entire balance sheet was just $800 billion. But in order to deal with the 2008 financial shock (yet another crisis that the Fed missed), they invented “quantitative easing”, or QE.

QE was just a fancy way to say they were conjuring massive amounts of money out of thin air. Informally we could say they were ‘printing money’, though almost all of the new money was created in digital rather than paper form. They click a few buttons, and, poof, new money.

Naturally the Fed promised to eventually unwind QE and drain all of that new money out of the financial system. But they never did.

On the contrary, the Fed embarked on THREE distinct rounds of QE between 2008 and 2013, increasing the balance sheet each time. In the end, the Fed’s balance sheet peaked at $4.5 TRILLION, more than 5x its size prior to the 2008 crisis.

And they kept it at that level for years. Even by 2020, the Fed balance sheet was still around $4 trillion in size.

So much for unwinding. And when the pandemic hit, the Fed quickly pulled out its QE playbook and embarked on a fourth round of money printing… exploding the balance sheet all the way to NINE TRILLION dollars.

Warsh eviscerates the Fed policymakers for failing to see such obvious consequences and explains that there is a very clear connection between the size of the Fed’s balance sheet, i.e. the amount of money it prints, and inflation.

“The monetary base is up 60% since the pandemic. Another measure of money, M2, is up 36% in the past four years. The inflation surge in the same period– cumulatively about 22%– shouldn’t have been a surprise.”

“The high priests of central bank dogma might consider it blasphemy,” he writes, but “less money printing, less inflation.” Duh.

He goes on to say, “The American people are still paying a high price for the central bank’s policy error,” and that if the Fed really wants to tame inflation, they’re going to have to slash their balance sheet, i.e. unwind most of the new money that they printed.

Fat chance.

In fact, Warsh points out that the Fed has already indicated they will NOT reduce the size of their balance sheet any longer. And Peter and I both believe the Fed will soon embark on even more QE.

Why? Because the federal government has a serious spending problem. Even the government’s own budget forecasts show an additional $22 trillion in deficit spending over the next decade.

And where will the bulk of that money come from? Most likely from the Fed. They’ll launch QE5, QE6, and beyond, to print the trillions and trillions of dollars that the US government will need to make ends meet in the coming decade.

Sure, it’s possible that the government gets real… that they cut spending, eliminate some entitlements, slash regulations, abandon idiotic green initiatives, and stop standing in the way of conventional energy.

But the window of opportunity is extremely narrow… and depends on the election this year. Plus, a lot of things will have to go right, and very little can go wrong.

So, it’s reasonable to anticipate more deficit spending, which means more Fed printing. And more inflation.

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The year was 1994. Former NFL superstar OJ Simpson has just fled from police in the infamous low speed chase in his white Ford Bronco. Pulp Fiction was playing in the cinemas.

And 29 year old Kamala Harris began dating one of the most powerful politicians in the State of California— Willie Brown.

Brown had been in politics for decades at that point and has risen to become the Speaker of California State Assembly, then Mayor of San Francisco.

(And despite having spent his entire adult life in politics, Brown somehow managed to amass a collection of $6,000 suits and expensive sports cars.)

Willie Brown was also at 60 years of age back in 1994 (he’s 90 now), three decades older than his girlfriend Kamala.

Obviously she was in it for love. I’m sure that’s the case.

But it just so happened that, barely a few months into their steamy relationship, Speaker Willie Brown appointed Kamala to multiple, senior-level positions in the state, including a seat on the California Unemployment Insurance Appeals Board and the Medical Assistance Commission.

I’m also sure that Brown appointed his girlfriend due entirely to her competence, and absolutely no other reason whatsoever.

These appointments, along with Sugar Daddy’s public support and endorsement, were integral in Harris’s later campaign to become San Francisco District Attorney, then Attorney General of California in 2010.

Willie Brown also endorsed her for Senate when she declared her candidacy in 2016, and was instrumental in securing her top endorsements, including from Joe Biden and Barack Obama.

Again, all of this success was clearly due exclusively to Kamala’s tremendous competence and nothing more.

Now, a lot of people have been remarking lately that Kamala is a DEI (Diversity, Equity, and Inclusion) hire.

But that’s completely unfair. Talk about a low blow. I mean, Kamala’s critics have completely missed the point that this woman— who claims to embody female empowerment— got her start by having sex with a powerful California politician 30 years her senior.

So let’s give credit where credit is due: she slept her way to the top well before she became a DEI hire.

In fact it wasn’t until she was picked to be Joe Biden’s running mate that she started benefiting from the DEI obsession.

Curiously, it is now considered racist to even bring this up. CNN has decided that calling Vice President Kamala Harris a “DEI Candidate” is “pseudonym for the N-word” and “racist dog whistle”.

That’s absurd. Joe Biden’s entire presidency has been about promoting DEI candidates, and he admitted this himself recently when he said:

“To me the values of Diversity, Equality, Inclusion are literally— and that’s not kidding— the core strengths of America. That’s why I’m proud to have the most diverse administration in history that taps into the full talents of our country. It starts at the top with the Vice President.”

Biden also made it perfectly clear in 2020 that he wanted to select a woman of color as his running mate.

So why exactly is it controversial to assert that Kamala was a DEI hire? Is it also controversial that the sky is blue, or that Michael Jordan was an exceptional basketball player?

But these people in charge have a way of acting offended about even the most basic and obvious truths. It’s quite a talent.

Speaking of talent, Kamala has none.

Whenever she opens her mouth, she is as incompressible as Joe Biden yet without the excuse of age and dementia. Like this gem:

“So I think it’s very important… for us, at every moment in time, and certainly this one, to see the moment in time in which we exist and are present, and to be able to contextualize it, to understand where we exist in the history and in the moment as it relates not only to the past, but the future.”

This is also the person that was put in charge of the border security, which has been a total disaster. But in her televised explanation, she justified having not been to the border by saying she hadn’t been to Europe either.

Wow, really racking up those foreign policy credentials!

And on the topic of foreign policy, check out this inspiring quote as Kamala showcased her encyclopedic understanding of European affairs:

“Ukraine is a country in Europe. It exists next to another country called Russia. Russia is a bigger country. Russia is a powerful country. Russia decided to invade a smaller country called Ukraine, so, basically, that’s wrong.”

Note that this wasn’t an interview on Nickelodeon or some event with elementary school kids. This was an actual response in a real interview about the war in Ukraine.

One of may favorite Kamala stories, though, is when she visited Puerto Rico earlier this year.

Protesters were in the streets of San Juan, singing in Spanish. Kamala merrily clapped along, until an aide quietly whispered that the song was protesting her visit as a representation of the federal government’s “colonization” of Puerto Rico.

Her track record as a prosecutor is also far from impressive.

As the Attorney General of California, she prosecuted and incarcerated cannabis users. But in 2019, asked if she herself had ever smoked weed, she cackled and said, “I have. And I inhaled.”

In 2014, Kamala’s office argued to keep non-violent inmates (including from minor drug convictions) locked up so that the state would have free prison labor to fight wildfires.

But Kamala would prefer that her Black Lives Matters voters forget about all that.

The Big Lie they are now force-feeding us is that the party of democracy is energized and united around Kamala Harris.

Personally I think they are terrified and desperate. Deep down they know this woman is an incompetent buffoon. And more importantly, they are still incredibly fractured.

Just look what the radical left has been doing this very week.

Their Marxist foot soldiers have been busy burning American flags, defacing public monuments, and hoisting Hamas flags, while chanting “Allahu Akbar!” in the streets. Curiously most of them are white atheist 20-somethings from upper-middle class upbringings.

And some of the Left’s most prominent politicians boycotted a speech given by the Prime Minister of Israel— one of America’s strongest allies during its time of war.

This continues to look like a group that is completely out of touch, but insists that they have everything under control… which is pretty much par for the course given the last few years under Biden.

Having said all that, it would be foolish to think they won’t pull out all the stops— continue to create all the propaganda, tell whatever lie, manufacture whatever hoax, and suppress whatever truth is necessary to win.

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In 1848, a 29-year-old Sacramento shop owner named Samuel Brannan was tending the cash register at his store when a pair of shoppers asked if they could pay him in gold.

Brannan was stunned when the shoppers pulled out solid gold nuggets. The gold, they said, had been found at Sutter’s Mill, about 35 miles northeast of Sacramento.

In addition to owning the only shop between San Francisco and the gold site at Sutter’s Mill, Brannan also happened to own a newspaper. And so he immediately used his paper to start spreading the word about the gold discovery.

According to legend, Brannan supposedly kept a small vial of gold to show prospective miners, and he once allegedly ran through the streets of San Francisco shouting, “Gold! Gold from the American River!”

Brannan’s newspaper constantly ran stories claiming that all you needed was a shovel, a pick, and a pan, and you too could get rich digging gold in California.

His hyping of the gold discovery is rumored to have helped spark the rush of 300,000 people to California to dig for gold— many in 1849, giving rise to the moniker “the San Francisco 49ers.”

But Samuel Brannan was NOT among them digging for gold.

Instead, during the peak of the Gold Rush, he sold about $5,000 worth of shovels, picks, pans, and other equipment to miners each DAY at his store on the way to the Mother Lode.

That would be nearly $200,000 per day in 2024 dollars. And Brannan is cited as California’s first millionaire.

“Picks and shovels,” has become a common descriptor in investments— sometimes the best opportunity when a new “gold mine” is found is to sell the “picks and shovels” needed to mine the gold.

Right now, the biggest new gold mine out there for investors is artificial intelligence.

And Nvidia is almost single-handedly responsible for producing the hardware (GPUs) for many of the most popular AI applications like ChatGPT.

But in addition to the hardware required to run AI, there is also an ongoing energy need. And it’s not trivial.

In fact, for every dollar companies spend on a GPU (which can easily run $40,000+ each), they will have to spend another dollar for the energy to run it.

AI applications like ChatGPT can generally be broken down into two stages: training, and querying. The training phase is where they feed vast amounts of data into the algorithm so that it can ‘learn’.

And this training phase is absurdly power-hungry; training a single algorithm can be the equivalent electricity of tens of thousands of homes. It’s like a small city.

Then there’s the ongoing querying phase, i.e. the power consumed when users say “Generate an image of a cat playing the harmonica”. Millions upon millions of queries in real time require substantial energy, about 10x as much as Google uses for its entire search function.

And that figure is growing.

The problem for America’s power infrastructure is that it is already strained.

With the government pushing regulations to force people to buy electric vehicles, it will only overload the grid that much more.

And exacerbating the problem is that the people in charge now keep pushing for extremely inefficient and intermittent “green energy” like wind and solar, which simply cannot produce electricity in the same quantities as conventional sources.

In short, America’s power grid is already struggling. And AI will continue to create a surge in electricity demand that utility companies may not be able to meet.

Big technology companies know this, which is why many of them are looking at building out their own power plants… just to ensure that their data centers never run out of electricity.

The best solution by far would be small scale nuclear reactors. But that technology just isn’t quite ready yet.

So the next best reliable and inexpensive way to produce electricity is through natural gas.

US natural gas is priced at around $2.50 per million BTUs. If you look at this in terms of pure energy, $2.50 natural gas is the energy equivalent of a barrel of oil selling for about $15.

In other words, US natural gas is absurdly cheap, one probably one of the most underpriced commodities in the world.

Tech companies and electrical utilities know this. So there’s a good chance that natural gas becomes the favored energy commodity for new power plants that will continue to drive the AI boom.

That’s why I believe natural gas is currently the best “picks and shovels” investment to scoop up in the AI space: energy is the one thing that these power-hungry AI applications need. And natural gas is the cheapest form of energy in the world.

It also helps that the stock prices of many of the highest quality and most profitable natural gas producers are laughably cheap. So there’s clearly a lot of upside potential from here.

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fraud (noun) /frôd/ : “DECEIT, TRICKERY, specifically: intentional perversion of truth in order to induce another [person] to part with something of value or to surrender a legal right. An act of deceiving or misrepresenting.”

This is the actual definition of fraud from Merriam-Webster’s online dictionary.

Of course, anyone who has talked about fraud over the past few years has been canceled as a baseless conspiracy theorist. But at this point there are certain things that need to be said. It’s time.

The 2020 election was full of fraud. And I’m not talking about ballot harvesting or manipulation of the vote count.

I’m talking about the legacy media and Big Tech’s coordinated effort, along with dozens of intelligence officials, to scrub any mention of Hunter Biden’s laptop from the Internet just two weeks before the 2020 election.

And now it’s clear that the media was also covering up Joe Biden’s infirmities, as far back as the 2020 election. A handful of journalists are finally now starting to admit that they noticed Joe Biden’s cognitive decline back then— but said nothing.

These examples fit the textbook definition of fraud, straight out of the dictionary: the intentional perversion of truth. . . an act of deceiving or misrepresenting. So I don’t see how talking about fraud in the last election is even remotely controversial.

And the lies have continued for the past four years with the intentional cover-up of Biden’s rapid cognitive deterioration. It has been one of the biggest political frauds of all time.

The media was complicit. The big Hollywood stars and donors were complicit. World leaders were complicit. And of course the party elites were complicit.

Kamala Harris is in that group as well; she 100% knew that Joe Biden is mentally unfit to serve as President of the United States. Yet she continued to deceive the public and cover up the truth.

This, too, is fraud. Kamala Harris is a fraudster.

Yet now she is being anointed as her party’s standard bearer, even though the only reason she has her job to begin with is because she sits down to pee and has greater quantities of melanin in her skin. These are the qualifications that Joe Biden looks for when he hires people.

Any honest evaluation of Kamala shows that she is a complete failure.

She is directly tied to the policy disasters of the Biden administration, and even responsible for some of them. She was a hideous candidate in the 2020 Presidential election and garnered a whopping zero delegates.

Whenever she opens her mouth to speak, she is just as incomprehensible as Joe Biden without the excuse of dementia.

And her personality is so devoid of authenticity that she makes Hillary Clinton look as folksy and genuine as Taylor Swift.

It is incredible when you think about it; these Leftists have essentially traded one liability of a candidate (Biden) for an even worse liability of a candidate (Harris). It’s genius!

But that’s typical for the Left. They have demonstrated over and over again that they cannot learn from their mistakes.

Their ideas have proven to be total disasters— from “defund the police” to idiotic border policies to student debt forgiveness to lockdowns and vaccine mandates. But they never learn. They keep doubling down on the worst ideas.

Now they’re in complete unity about their worst idea of all: Kamala Harris. And the top people in the party are already behind her.

That includes former President Bill Clinton and his shrew wife, who put out a statement of support for Kamala Harris yesterday.

According to the Clintons, “… nothing has made us more worried for our country than the threat posed by a second Trump term. He has promised to be a dictator on day one, and the recent ruling by his servile Supreme Court will only embolden him to further shred the Constitution. Now is the time to support Kamala Harris and fight with everything we’ve got to elect her. America’s future depends on it.”

You’d think that a former President Clinton, watching the attempted assassination of another former President, would have chosen his words more carefully.

But no. Despite hollow promises to “tone down the rhetoric”, they’ve already restarted demonizing Trump in the strongest possible terms.

Even the assertions are ridiculous. Trump will “be a dictator on day one”. How exactly? He is going to somehow dissolve both chambers of Congress and the Supreme Court?

Speaking of the Supreme Court, for a former President to call the court “servile” is really undignified.

And they obviously have no intention of toning down the language, encouraging people to “fight with everything we’ve got” for Kamala Harris. It’s about as bad as Joe Biden’s “bulls-eye” comment just prior to the assassination attempt.

It all shows that, despite such obvious consequences of their lies, their propaganda, and their demonic hyperbole, these people have learned absolutely nothing. They keep making the same mistakes over and over… and continuing to commit more fraud.

Just consider that, because of their deceit, the country is stuck for another six months with a brain dead President who refers to his own Defense Secretary as “the black guy” because he can’t remember his name.

The whole world knows it now. It’s no longer a poorly guarded secret. No one can pretend any longer.

And it would be naive to think that America’s adversaries won’t take advantage of this chaos.

Their fraud has made the country weaker, and it has made the world more dangerous. But they still feel their actions are righteous based on a delusion that they’re ‘saving democracy’.

Sure. These people deprived their own voters of a choice by trying prevent anyone else from running against Joe Biden. And now they’re depriving voters of a choice by thrusting Kamala Harris down everyone’s throat.

Yet somehow the guy who was one inch away from being assassinated— thanks in large part to their own dramatic hysteria— is the threat to democracy.

Makes total sense.

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Obviously the attempted assassination of Donald Trump represents a grim milestone on America’s path of decline, as I wrote about in detail on Monday.

But the legacy media’s response to it may also go down as a major turning point: the moment they finally lost all credibility.

Now, clearly for a long time the media has been full of Inspired Idiots who don’t care about reporting the truth. Instead, they push a narrative they want people to believe about the world and the events which shape it.

For example, CNN famously described 2020 Black Lives Matters riots as “fiery, but mostly peaceful.”

In 2021, when the governor of South Dakota banned biological men from participating in female sports, CNN promptly reported that, “there is no consensus criteria for assigning sex at birth.”

NBC News was caught in 2021 colluding with the Biden administration to downplay the criminal past deeds of Tracy Stone-Manning, who the President had nominated to lead the Bureau of Land Management.

Stone-Manning was an eco-terrorist in her youth who was involved in tree-spiking activities that kill or maim loggers. But NBC News promised to take it easy on her to help push her appointment through.

Also in 2021, however, NBC News (along with just about every other mainstream ‘news’ outlet) hyped unproven allegations against Supreme Court nominee Brett Kavanaugh that went back 30 years.

And when #MeToo protestors stormed the United States Capitol and accosted Senators in an attempt to disrupt and overturn the Kavanaugh confirmation hearings, the media did not label these protestors ‘domestic terrorists’, as they did with January 6 protesters.

The media circulated outright lies about the Russia voter manipulation hoax. And the New York Times was even awarded the ‘esteemed’ Pulitzer Prize for its reporting of this thoroughly discredited story.

It’s also notable that, even after the Russia collusion story was proven to be false, the Pulitzer committee REFUSED to rescind the award it had bestowed to the Time. Their logic, apparently, is that quality reporting about blatant lies is still worthy of journalism’s highest honor.

Then, of course, in the weeks before the 2020 election, nearly every legacy news outlet outright refused to report on the laptop of Hunter Biden. The younger Biden’s laptop not only showed deep character flaws, but evidence of significant corruption and foreign influence connected to his father.

And don’t even get me started on how the legacy media reported on COVID, lock-downs, and vaccines.

But now they’ve taken elevated their lies and propaganda to a whole new level with the way they have portrayed last week’s assassination attempt on Donald Trump.

These “journalists” witnessed in real time an attempted— and very nearly successful— assassination of a former President, upon which they reported:

“Trump Escorted Away After Loud noises at rally” –The Washington Post

“Secret Service rushes Trump offstage after he falls at rally” –CNN

“Trump says he was shot in the ear at rally” -NPR

OK, let’s be extremely polite and give them the benefit of the doubt; immediately following the assassination attempt there were plenty of unknowns.

But even after the fog of war had been lifted— after it was clearly an attempted assassination— the Washington Post updated its headline to: “Trump safe after being rushed off stage following shooting at rally.”

In another article it said the assassin “shot at Trump,” not “shot Trump.”

Technically, that passes a fact check. But it’s sort of like describing Mount Everest as an elevated piece of land.

And the spin continued the next day.

Reuters ran an article titled, “Republicans, in wake of Trump shooting, seek to pin political violence trend on Democrats.”

This obviously ‘unbiased’ and ‘trustworthy’ news agency couldn’t simply report on the known facts of the attempted assassination. No, instead, their priority was to tell readers that it is the RIGHT, not the LEFT, that is full of violent extremists.

“A Reuters analysis of more than 200 incidents of politically motivated violence between 2021 and 2023, however, presented a different picture: In those years, fatal political violence more often emanated from the American right than from the left.”

Reuters didn’t actually cite a single example of this right-wing violence.

In fact, the only example of violence they did mention was the shooting of Steve Scalise, a Republican member of Congress who was gunned down (but survived) in 2017… by a Left-wing extremist.

So… in an attempt to prove its assertion that its readers should fear Right Wing violence, Reuters’ only example was an instance of a Left Wing extremist shooting a Right wing politician.

Genius!

And these Inspired Idiots in the media still can’t understand why nobody trusts them.

Days after the attempted assassination, the Associated Press noted that the left and right now have dueling conspiracy theories about the assassination attempt— that Trump staged it for clout, or that the Secret Service was in on it.

AP lamented, “Americans are increasingly choosing their own reality, at the expense of a shared understanding of the facts.”

Gee, whose fault is that? (remember, AP published the headline: “Donald Trump has been escorted off the stage by Secret Service during a rally after loud noises ring out in the crowd.”)

The attempted assassination of Trump was a rare event, in that it was broadcast in real time, and everyone could see exactly what happened with their own eyes from multiple angles.

And still the media tried as hard as possible to sell a completely bullshit narrative of the event.

What do you think they do with events that are not so clear, or are not caught on camera from every angle? How trustworthy are those “anonymous sources” they love to cite?

This is why the legacy media is becoming less trusted by the day.

It’s also why, despite Inspired Idiots owning the vast majority of broadcast media, they still haven’t been able to tip the scales decisively in favor of their own little cultural revolution.

Confronted with an event they knew would make their nemesis look strong and unbeatable, they resorted to cartoonish propaganda.

And I hope that proves to be the decisive moment for people to see them for what they are: liars.

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Jamie Dimon is the CEO of JP Morgan Chase, one of the world’s largest banks. And last week he issued a stern warning on the bank’s quarterly earnings call that “multiple inflationary forces” are still lurking.

File that one away under “duh”. It should be completely obvious to just about anyone paying attention to the world that many of the key drivers that rocketed inflation higher are still with us.

The Federal Reserve, of course, desperately wants to pretend that inflation is in the rear-view mirror, never to return. And they keep insisting that the downward trend of inflation justifies their interest rate cuts.

But as Mr. Dimon points out, “large fiscal deficits, infrastructure needs, restructuring of trade and remilitarization of the world” all create high risk of substantial inflation.

We agree with him.

“Remilitarization of the world”, i.e. conflict, is very expensive. The very nature of war means consuming vast quantities of resources to produce munitions that will destroy your adversaries’ resources.

Most governments don’t have the money to do this. The last time the United States was able to fund a war without going into debt was the Spanish-American War in 1898. Every other war, or even preparation for war, required significant additional debt… which ultimately resulted in printing more money.

So, in the end, warfare means more money in the system, but fewer resources. This is the very definition of inflation.

Dimon mentions trade disputes as well, which are also very expensive.

Free trade creates wealth. It allows countries and producers to specialize in what they do best, and trade for what other countries do best.

Germany is great at high tech manufacturing, pharmaceuticals, and various other industries. But they can’t produce bananas to save their life.

Fortunately, Guatemala exists. Guatemala has no high-tech industry. But they’re great at bananas. It’s a sensible trade.

When nations are in dispute with one another, trade breaks down and they start having to produce goods and services where they have no expertise.

Sometimes it works out; in one of their endless wars with France, Britain boycotted French wine… and in the process, accidentally invented port. But usually, such inefficiencies create a lot of inflation.

Dimon also mentions infrastructure needs. And that’s a massive understatement.

The US highway system is deteriorating. Amtrak is blowing money without any serious improvements. California is tens of billions of dollars over budget, and several years late, for a high-speed rail it promised from San Francisco to Los Angeles.

It doesn’t help that they put $1 trillion in the hands of an incompetent diversity hire like Transportation Secretary Pete Buttigieg.

All of this money will need to be conjured out of thin air by the central bank, which, again, is inflationary.

Lastly, Dimon also references “large fiscal deficits”, which is putting it politely.

We’ve said it many times— the government’s own internal projections expect an extra $22 TRILLION in deficit spending (i.e. new debt) on top of the $35 trillion national debt, over the next decade. Most of that will come within the next five years.

Deficits are inflationary, as we have seen over the past few years.

To be fair, there are some potential deflationary forces as well.

Increases in productivity are very deflationary. Technology, driven by artificial intelligence, could be monumental in improving productivity and keeping prices down.

Yet there are also a lot of people in government (and even within the AI industry), trying to slow down development and hold back AI.

Capitalism— which encourages competition to offer the best quality goods and services at the lowest prices— is also deflationary.

Unfortunately, many people in power despise capitalism and rail against it as racist, misogynist, or bad for the planet.

Even the President of the United States constantly moans about America’s most successful companies, claiming that their “greed” is an evil force keeping inflation high and prosperity low.

It’s quite ironic that a man who refuses to step down and clings to the Oval Office is complaining that other people are greedy. Joe Biden is the embodiment of greed.

So, I’m not holding my breath that these deflationary forces, i.e. capitalism and AI, will be kicking in anytime soon to counteract the negative effects of deficits, conflict, etc.

This is why we continue to anticipate higher inflation down the road.

Where I disagree with Jamie Dimon, however, is that I don’t think the Fed is going to do anything about it.

In theory the Fed should be holding interest rates at higher levels… or even increasing interest rates. This is the normal tool they use to reduce inflation.

But the Fed has 35 trillion reasons to not raise interest rates.

At $35 trillion, the US national debt is simply too high for interest rates to remain where they are right now.

This year alone, the US government has to refinance $6 trillion worth of debt that is about to mature. Refinancing the debt means having to pay a much higher rate of interest… easily 3% higher than in the past.

That’s a whopping $180 billion per year in additional interest costs that the Treasury Department is going to have to pay. And they’ll pile on even more interest expense next year and the year after that.

Uncle Sam simply cannot afford that bill. The Treasury Department needs rates as close to zero as possible in order to not go bankrupt. And that’s going to mean LOTS of inflation.

The Fed knows the risk. But they’re going to have to choose between inflation… versus a full-blown meltdown of US government finances, and, by extension, the US financial system.

Inflation is the obvious choice.

My guess is that they’ll just come up with some new way to calculate the CPI to pretend that inflation is lower than it actually is.

The Inspired Idiots will start claiming that the CPI is rooted in racism and demand a new inflation metric that takes into account some DEI nonsense. And poof, the inflation rate will magically plummet.

Regardless of what tricks they come up with, in such an environment, it makes sense to own critical resources that the Federal Reserve cannot conjure out of thin air. And these are real assets.

Real assets retain or even grow their value when faced with inflation. And the added benefit is that many of them are dirt cheap right now.

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Rarely are events recognized in real time as obvious historical turning points.

The attempted assassination of Donald Trump is one of them, and it will go down as a clear marker in the history of America’s decline.

It epitomizes the chaos and disorder that characterize the current state of affairs. And it escalates a sharp divide in American politics.

Of course, this isn’t the first attempted Presidential assassination. But it marks a new era where political tensions have moved clearly into political violence.

We’ve been watching it all year with the anti-Israel protests. We saw it during the BLM riots. Now it has escalated to political assassination.

A bullet came within centimeters of ending the life of a former President, and top contender for the highest political office in the land. It would have been an extremely violent death, live-streamed from hundreds of phones and cameras.

Trump survived, but at least one rally attendee is dead. He’s dead because he went to a political event to support his chosen candidate for democratically elected office. And someone decided that instead of allowing voters to decide our country’s future, he would use violence to alter the political landscape.

Is it really hard to understand what would push someone to such extremism?

For eight years, the media has been telling people that Trump is Hitler and represents an existential threat to humanity.

The clear implication of their fear-mongering is that extreme measures are justified.

And in the hours after Trump was shot, the media continued its shameful miscarriage of its duty.

CNN declared, “Secret Service rushes Trump offstage after he falls at rally,” and “Trump injured in incident at rally.”

Even after it became obvious that a bullet struck Trump, and that it was clearly an assassination attempt, the Associated Press, CNN, NBC and others continued to run with headlines with some variant of, “Shooting at Trump Rally.”

NPR’s headline read, “Trump says he was shot in the ear at rally”. Note the wording: “Trump says”, as if this was just another wild, unverified claim from the former President that needed to be run past one of their holy fact checkers.

This might seem like a subtle point to harp-on given the momentous event. But it’s not. It’s part of the decay in American institutions. The media spins, spins, spins, even in the moments after their number one target, the man they demonized above all, got shot.

And that’s also why the well-wishes from Trump’s political rivals ring hollow.

It’s one thing to criticize someone’s policies, or explain how you believe their actions or leadership will make the country worse.

But it’s hard to deny that the left’s extreme histrionics in exaggerating the existential risks of a second Trump presidency is at least partially to blame.

I think much of the blame also falls on Joe Biden.

Remember, this is the guy who promised to unite the country and “restore the soul of America”. Bang up job, Joe. Instead he has deepened divisions, to the point that ideological fault lines in America are far worse than they were four years ago.

And that says nothing about his record on inflation, national security, global security, the border, and more.

The majority of Joe Biden’s own party doesn’t want him to run. But he insists he is staying in the race. The left is terrified. They know they cannot win. If Biden had bowed out, they’d have some chance. But with Biden, they have zero chance.

So it’s not surprising that some deranged foot soldier— feeling a sense of desperation and inevitability about Joe Biden losing the election— took it upon himself to eliminate Donald Trump.

Much has been written on the Internet these days about the poor security at the event as well. But we shouldn’t be surprised about that either. Remember, Joe Biden picks his people based on diversity & inclusion credentials, not actual talent. And that includes the Secret Service.

But just to give you an idea of just how spectacularly bad the security was—

If you look at a satellite image of rally site, you’ll see there are six structures with elevated rooftops (i.e. at least 3-5 meters in height) which had a clear line of sight to where Trump was speaking.

That means those six locations were high-risk vulnerability points that the Secret Service should have sealed off from the moment they showed up to the venue.

Instead they were wide open. And the shooter positioned himself at the CLOSEST one, less than 150 meters away. This failure to include such a tactically important position within the security perimeter is beyond inexcusable.

There are plenty of videos floating around showing crowds of people shouting at the cops, informing them of the shooter’s presence on the rooftop. But law enforcement didn’t react in time.

Is anyone really surprised? Don’t we remember the Uvalde school shooting in Texas, in which a deranged madman was murdering children, and the cops stood around and did nothing?

The escalation of political violence is deeply disturbing. But the sheer security incompetence of the incident is another national humiliation, on the order the disastrous withdrawal from Afghanistan. America’s adversaries cannot believe what they’re seeing.

So where to from here?

Well, the Left has already tried everything to keep Trump out of power. They tried disinformation and the Russia collusion hoax. They tried impeachment. Twice. They tried full-blown lawfare. They tried to throw him in jail. They even tried to remove him from the ballot. Nothing worked.

And, now, someone has even tried to take him down with a bullet.

I don’t even want to think about the potential chaos had the bullet been an inch to the left, and it had been Donald Trump’s brains as opposed to his blood spilling onto the stage.

But he survived, and the Left is completely desperate now. Voters are soon going to choose between an enfeebled old man who can’t complete a sentence, versus a guy whose his first instinct after an attempted assassination is to show strength.

It’s pretty obvious which image America needs to project right now. And for all of their talk of saving democracy, the Left is terrified of allowing the voters to choose. All of their grand plans have failed… one after another. They know they’ll lose.

I think the only other tricks up their sleeve are:

(1) Joe Biden has an ‘accident’ (which might be blamed on some MAGA guy, just to get everyone riled up), and they replace him with a viable candidate;

(2) Rampant voter manipulation.

I’m not holding my breath for the third option, i.e. they allow voters to freely make up their own minds. The Left is fanatical, and as the assassination attempt shows, they are willing to do anything to accomplish their goals.

Trying times indeed. It’s clear that having a strong network of trustworthy, like-minded people is becoming more important than ever.

 

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Recently, we noticed a few examples of obvious contradictions to the left’s narrative. Here’s the hypocritical, the counterproductive, and the tone-deaf stances they’ve taken, just in the past week.

Carjacker Shot By Justice Sotomayor’s Security Outside Her DC Home

Earlier this week, 18 year old Kentrell Flowers attempted to carjack a man he apparently didn’t know was a US Marshall guarding the Washington DC home of Supreme Court Justice Sonia Sotomayor.

The teenage perpetrator was shot in the face four times by the Marshall, while a different federal Marshal sprayed bullets in his direction, but missed. Kentrell, however, survived, and was arrested.

It’s hard to ignore the irony that the crime wave enabled by leftist prosecutors and judges has shown itself on the doorstep of one of the most leftist judges in America. But the irony goes deeper than that.

Sotomayor was protected by a man with a legal gun, against a teenager with an illegally acquired gun, in a city with some of America’s strictest gun control laws.

It’s notable that Justice Sotomayor has been a major advocate of gun control; in the case McDonald v. City of Chicago, she argued that governments should be able to restrict firearm ownership, and that individuals might not have a constitutional right to bear arms.

She also argued in New York State Rifle & Pistol Association Inc. v. Bruen that New York should keep its strict gun control measures.

If Sotomayor had her way, no one in crime-ridden DC would be able to defend themselves… unless, of course, they had the privilege to be guarded by an armed US Marshall.

 

Is This How You Protect Democracy?

Chuck Todd is the Chief Political Analyst for NBC news. This week, he revealed that a member of President Biden’s cabinet told him Biden was mentally unfit for office… two years ago.

That’s an interesting time-line for a “journalist” to break an exclusive story about someone in the highest echelons of the Biden Administration revealing that the sitting president was unable to perform his duties due to cognitive decline.

Yet Todd apparently missed the irony of his own silence as he said, “It’s the classic open secret… It’s the story everybody knows, and that everybody was afraid to talk about.”

But now that everyone saw it for themselves in the debate, Chuck Todd feels comfortable jumping on the bandwagon to oppose Biden.

Is this really considered serious journalism? Hiding a real scoop to protect a political party, and only going public when it becomes the popular thing to do?

Then there’s George Clooney, who in an opinion piece for the New York Times, wrote that he knew at a fundraiser he headlined for Biden on June 15 that Biden’s mental capacity was gone.

A month later, after the tide has safely shifted against Biden, Clooney decided it was time to express the extremely safe and mainstream view that Biden should step aside. Such bravery! Such integrity!

The journalists who were present at the June fundraiser also apparently didn’t feel the need to report President Biden’s obvious signs of decline to the public.

Meanwhile, two Democrat operatives from academia have game-planned a “Blitz primary” whereby the new party nominee will be selected by a handful of party elites. To protect democracy, of course!

And major donors to President Biden and the Democrats, such as Disney heiress Abigail Disney, say they will withhold funds from the party until President Biden is replaced.

Because nothing screams democracy like a group of wealthy elites forcing the democratically elected candidate to step aside!

But Ms. Disney took it one step further by suggesting that it’s also racist and sexist to NOT replace Biden.

“We have an excellent Vice President,” Ms. Disney said. “If Democrats would tolerate any of her perceived shortcomings even one tenth as much as they have tolerated Biden’s (and let’s not kid ourselves about where race and gender figure in that inequity)… we can win this election by a lot.”

But perhaps the most hilarious part about this all is the left freaking out about getting a taste of its own medicine.

Chuck Todd, for example, said Democrats are frustrated with Biden’s refusal to admit their concerns about his mental fitness are valid.

“He’s attacked his own party members without simply acknowledging, ‘I get it. I understand why you’re concerned.’”

Welcome to the party! These same party elites who gaslit everyone else for years over vaccines, Covid lockdowns, masks, Trump, and Joe Biden, are now complaining about being gaslit themselves.

But regardless, there is still about a 50% chance that these are the people in power when the dust settles this November. That’s a good reason to have a Plan B.

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Today’s inflation report showing ‘only’ 3% inflation, the Federal Reserve is all but guaranteed to start slashing interest rates.

The Fed Chairman essentially promised as much to Congress earlier this week, and has warned that if they don’t start cutting interest rates soon, “we could undermine the [economic] recovery.”

These guys still don’t get it. At this point it’s not even about 3% inflation (which is still too high) or 2% inflation. It’s about prices going back down to pre-pandemic levels… or just lower in general.

But that’s just never going to happen. The Fed doesn’t care about price reductions; they’re happy with a slower rate of price increases… which is totally out of touch with what people want and need.

They’ve been itching to cut rates for months… almost desperate. And in large part that’s because they’re terrified about the US government’s insolvency.

The national debt is about to pass $35 trillion. And high interest rates mean that the annual interest bill this year will exceed the US military budget– more than $800 billion– for the first time in nearly 250 years of American history.

The Fed knows that they have to slash interest rates as quickly as possible. With ultra-low rates (like 1.5%), the interest bill on a $35 trillion national debt is manageable… as long as the federal government can rein in spending and stop the debt from growing further.

Of course there are two key problems with this thinking:

First, there is zero evidence that the government will rein in spending. If anything, they seem primed to spend even more. I’ve mentioned several times before that even the US government’s own budget forecasts project more than $22 trillion in additional debt over the next decade.

Second, slashing interest rates will most likely result in significant inflation– just like we saw in 2021-2022.

We’ve written before how real assets are a safe haven from inflation, and I wanted to briefly discuss three real assets that look especially promising.

The first is physical gold and silver, which serve as a store of value– especially during inflationary times.

Higher inflation will likely trigger a surge in demand, making the price of precious metals not only keep up with inflation, but exceed it.

But there is another reason why gold will do especially well the worse inflation gets.

The worse inflation becomes, and the worse the US national debt becomes, the more likely the US dollar will lose its spot as the dominant reserve currency. And central banks all over the world– India, Poland, Singapore, etc. have been feverishly buying up physical gold over the past few years, most likely to prepare for that potential change.

So if inflation picks up, it’s a good bet that central banks will keep buying up gold– and driving prices higher.

Gold mining stocks should also do extremely well in that scenario due to their exposure to gold prices.

What’s interesting right now, though, is that despite gold being near an all-time high, share prices of many gold mining companies are incredibly cheap.

That’s because central banks– which have driven gold prices to record highs– only buy physical gold bullion. They do not buy gold stocks.

However, while the price of gold has already increased substantially, the stock prices of many great gold miners has not.

This is because most of the current demand for gold is coming from central banks. And central banks only buy physical gold— not gold mining stocks.

This means that gold stocks are currently a bargain– with a LOT of upside potential.

Last, US natural gas is another compelling real asset primed for huge growth.

Right now, natural gas prices in the US are dramatically lower than they are in Europe… and it’s easy to understand why: the US has some of the biggest natural gas reserves in the world, while Europe has almost nothing by comparison. (This is why Europe is so reliant on Russian gas).

And since Joe Biden has banned new LNG (liquefied natural gas) export terminals from the US, it’s difficult to move that US natural gas to Europe.

This is why prices in the US are less than $3, versus more than $10 in Europe. If US producers were free to export, prices in the US would rise, prices in Europe would fall, and the global natural gas prices would be more or less the same, similar to oil.

In terms of energy equivalence to oil, $3 per million BTU natural gas is the equivalent of paying around $15 – $20 for a barrel of oil. That’s cheap. And it means US natural gas is the most underpriced conventional energy commodity in the world.

But it probably won’t stay that way for long.

First, large tech companies, which are building massive, energy-hungry AI data centers, are also looking at putting in their own power plants… which will most likely be powered by natural gas.

Second, the new export terminal ban probably won’t last. There are lawsuits, legislation, and an upcoming election, any one of which could restart new LNG exports. When this happens, US natural gas prices could quickly rise.

In either case, natural gas producers stand to benefit substantially from higher prices. And it just so happens that shares of many of the best quality producers right now are laughably cheap, with low multiples relative to earnings, book value, and Free Cash Flow.

Looking at the overall investment landscape now, with many conventional stocks and indexes near all time highs, these three sectors strike me as some of the most promising investments for an inflationary environment.

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[Editor’s note: This letter was written by Schiff Sovereign’s CEO, Viktorija Simulynaite, who is on the ground in El Salvador.]

The first thing my driver said to me after I got off the plane in El Salvador was, “Welcome to my country. It’s very safe here now.”

I chuckled to myself because this seemed like such an odd greeting. But the more time I spent mingling with locals in El Salvador, the more it made sense.

The transformation that has taken place in the country over the past five years cannot be overstated.

Five years ago El Salvador had one of the highest murder rates in the world. It was basically a war zone. Gangs such as MS-13 and Barrio 18 were far more powerful than the government, and they enforced their own laws in their respective territories, sort of like the Taliban in Afghanistan.

The country’s young president, Nayib Bukele, put an end to all that when he was elected in 2019.

Bukele invoked emergency powers and arrested more than 100,000 suspected gang members, then shipped them off to a special prison far away from the rest of society. In a country of 6.3 million, that amounts to over 1.5% of the entire population that’s now locked up.

It was a controversial move to say the least… and I wonder about innocent people who may have been wrongfully imprisoned.

But El Salvadorans seem quite happy with the results; today their country boasts a lower homicide rate than anywhere else in the Western Hemisphere aside from Canada.

Simultaneously, El Salvador also put itself on the map by being one of the first countries in the world to get behind crypto; they even made Bitcoin legal tender and passed a number of pro-crypto tax incentives.

Those are pretty much the two things that El Salvador is known for these days– putting tens of thousands of criminals in jail, and Bitcoin.

But I was pleasantly surprised to find out that the country has so much more going for it.

This was a place that was scraping the bottom of the barrel just a few years ago. Even aside from the crime problem, the economy was in the dumps. Corruption and bureaucracy ruled the day, and debts were rising.

In just a few short years, however, El Salvador has managed to turn itself around, and the economy has taken off.

It’s not an accident. The government has slashed bureaucracy and established a number of incentives to bring in foreign capital and businesses.

One is the recently passed International Services Law, which offers significant tax incentives to service-based businesses, similar to Puerto Rico’s famous Act 60.

El Salvador’s law, though, is perhaps even more generous than Puerto Rico’s because it includes exemption for import duties, income taxes, municipal taxes, and more.

Service industries like call centers, data centers, software development, and other back-office services are starting to be growing industries in El Salvador, and I met a number of foreign entrepreneurs who are starting businesses in the capital.

Foreign investment is flowing in, and you can see construction projects everywhere– the capital city is quickly becoming sleek and modern, and it completely defied my expectations. Even the restaurant scene is really great.

More importantly, there’s an optimism in El Salvador– one that I haven’t seen in Europe and North America for a long time. People feel like the worst days are over and the future will continue to be much brighter.

Now, all that said, I’m not trying to suggest that El Salvador is some perfect paradise or that anyone should move their business there. I’m really writing about it as a sort of case study.

We talk a lot about how governments and politicians and “inspired idiots” wreck their economies. They rack up massive debts and engineer painful inflation and higher energy prices… and generally make things worse with their every move.

But it’s fair to point out that sometimes governments do smart things. And El Salvador is a great example.

They knew they had to figure out how to turn their economy around. And rather than go down a destructive rabbit hole of wage and price controls, which are standard approaches for bankrupt nations, El Salvador’s government got out of the way and is allowing the free market to blossom.

The one thing they have done very deliberately is market themselves.

Advanced western countries don’t do this. Joe Biden doesn’t travel the world pushing foreign nations to invest in America. Rather, he takes America’s standing for granted and simply assumes that everyone wants to invest there.

El Salvador is a tiny country plagued by a bad reputation for its past challenges.

But rather than let that reputation fester, its leaders are hustling to promote their country all over the world with a clear message: El Salvador is open for business.

It’s fascinating to watch such a positive transformation unfold for an entire nation in real time– and to see politicians deliberately do the right things to foster economic growth.

Given how many Western countries are rapidly deteriorating from their own idiotic political decisions, El Salvador is an obvious example of how much better things could be if reason and sanity were restored in government.

Imagine what the US would look like if politicians were actually cooperating and hustling to bring in new business, to make smart investments, to embrace capitalism, or even to simply rein in spending and slash bureaucratic waste…

We’re planning a boots on the ground trip to El Salvador for members of our Total Access group (i.e. our highest tier premium members at Schiff Sovereign). It’s going to be pretty great.

We’ll be meeting with senior officials and business leaders and checking out, firsthand, what’s going on in the country so that our members can see the transformation for themselves.

We’ll also eat at some of the country’s nicest restaurants and tour the beautiful countryside. And we might even leave with an investment or two.

(We’ve already had Total Access trips to places like Cuba, Singapore, the Republic of Georgia, Uzbekistan, and more, so El Salvador fits perfectly.)

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