Guest Post by Bill Bonner
LONDON – We first came to London a half-century ago. Back then, the city was tired and drab.
We stayed in a hotel, where we had to put coins in a heater to get any warmth and use the bathroom down the hall.
Now, London is a different city, full of young people, energy, and money.
Streams of people flood across Blackfriars Bridge in the morning – heading for one of the many daring new office buildings. As T.S. Eliot put it, we did not think death had undone so many.
Then, in the evening, the tide reverses; people return to the train stations… or wash up in one of the thousands of chic restaurants or trendy bars throughout the city.
“There is nothing like this in any other city in the Western world,” said a friend. “Paris is a museum. New York and San Francisco are tired and pale by comparison. This place is so dynamic.
“There are so many new buildings… so many people coming in from all over the world… and so much money pouring in, too.”
Where the money comes from is the dot we’re looking at today.
Provocative Suggestion
But before we get to that, we pass along a provocative suggestion from a dear reader:
Bill, you’re right about how capitalism is supposed to work. But you don’t work that way. You don’t give your customers what they want. You give them what you think they should have. As many of my fellow readers have pointed out, you’d make a lot more money if you got on the Donald Trump bandwagon and stopped annoying us by criticizing him.
We’re going to think about that overnight…
Hellish Economic Catastrophe
In the meantime… whence cometh London’s amazing wealth? And who cares?
Approaching the issue from the other end… let’s look at a place that has made itself desperately poor.
The New York Times is on the case:
Zimbabwe’s collapse under Robert Mugabe. The fall of the Soviet Union. Cuba’s disastrous unraveling in the 1990s.
The crumbling of Venezuela’s economy has now outpaced them all.
Venezuela’s fall is the single largest economic collapse outside of war in at least 45 years, economists say.
In the last five years, Venezuela’s GDP has fallen by nearly two-thirds. Inflation is running over 10,000,000%.
And today’s Financial Times tells us that “Venezuelans queue up for petrol, despite sitting on huge oil reserves.” Motorists are waiting in line for up to 20 hours to fill their tanks.
Venezuelans are living… or dying… through the most hellish economic catastrophe of the 21st century.
But the century has 81 more years to go. Our guess is that there are bigger disasters ahead.
Succumbed to Cronyism
There is nothing particularly novel about the Venezuelan debacle. It’s the kind of thing you can get when you mix bad politics with bad money.
Venezuela, we remind readers, was recently the richest country in Latin America, with vast reserves of the world’s No.1 resource – energy.
So, what went wrong?
There are many plots and subplots in the story. The Chavistas nationalized key industries, replacing capitalists and capable engineers with party loyalists and cronies. Output declined.
But the country had oil revenues. Then, oil production declined. From 3.5 million barrels per day in 2000, output fell below one million barrels per day. The oil industry – nationalized since 1976 – succumbed to cronyism, too.
All of this alone would have been bad enough. But then, there was the money. Or rather, the fake money. The same kind of money that Americans borrow… and that American tourists spend in London.
As far as we know, no disaster of this sort has ever occurred without fake money being involved.
You can have wars without fake money, though the two often go together.
You can have inflation without fake money, but it is rare and much less destructive.
You can have a depression, too. Even in the case of a depression, it usually ends quickly… unless the feds step in and block the correction, as they did in the 1930s.
You can have bad food, bad public policies, bad breath, and even bad weather.
But if you want a real financial catastrophe – France 1790-1797, Weimar Germany, Argentina, Brazil, Zimbabwe – you need fake money.
Teenage boys should never be given a fifth of whisky and the keys to the family car. Adults should never be authorized to counterfeit money.
Inevitably, in both cases, it goes to their heads.
Bigger Disaster
Not only has fake money been an essential part of every financial disaster, it always leads to some sort of societal disaster, too.
Which is why we suspect a bigger disaster is coming later in the century… and why we suspect it will be centered in the Fake Money Capital of the World – the USA.
Fake money is as old as the hills. But it usually only takes a few years before the fakeness of it is exposed… the financial system blows up… and real money is brought back.
But what makes fake money bad? And why, if it’s such a bad thing, does nobody notice but us?
Not the Trumpistas, not the Sanderistas, not the Bidenistas – nobody.
And why do we annoy our readers – who might prefer to hear that the Chinese are stealing their technology… the Mexicans are stealing their jobs… and the Russians are stealing their elections – by insisting that the real thieves are in Washington, not overseas?
Ahh… stay tuned…
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I have read Bill Bonner for near 20 years. I used to comment on the boards over at the Daily Reckoning (and elsewhere) before a poster named Richie (among others) spammed it to death with pictures of dog shit (seriously 100’s of pictures – pages worth) and Bill took it down. There was a guy named Lenny, too, who was not bad, but bragged about his pubic hair collection from every woman he had ever been with – claimed to be from Virgina if I remember correctly…at the end, the place was a madhouse of trolls. And then zerohedge started and many posters went there…
Anyway, all of the above from Bill and nary a mention of two things that come to my mind first when I think of Venezuela:
1.) Chavez asking the entire U.N. if they could “smell that?” – The “sulfur smell of El Diablo” that had just spoken before him….referring to Dubya. That is the kind of slight Poppy Bush will destroy a country over and kill a president for.+
2.) John Perkins. To whit:
If that pile of oil didn’t make them a target I don’t know what would. Chavez, commie stooge though he may have been, must have told them to piss off.
The U.S. has been doing this since the early 50’s….it is reasonable to assume some portion of Venezuelas current economic issues stem from diabolical and sinister intervention by economic hitmen as much as their own actions.
Because that is how the propaganda works – do you actually think that Big Pharma, Big Farma, Big Media, and BiG Politics are BIG without the help of the Federal Reserve (who makes the fake money)? Who, exactly, benefited from the ZIRP that buoyed the Big Obama regime? Was it the little farmer, the little newspaper, the little radio station, the little (local) politician . . . or was it the BIG guys? Of course, it was the big guys. Duh. Nobody notices because no one reports it but you, a LITTLE guy. You are Bill Bonner, NOT Jacob Rothschild. YOU are a little voice in a great big phucking cacophonous din of ear-ringing, brain-squashing, soul-killing maelstrom of NOISE . . . and no one hears you, because the propaganda blasts from 900 million, distinct, clear-channel-esque points of origin . . . and you are one f*ckin’ guy with a bullhorn. That is not to say that the truth is not on your side, but in the smoke and the mirrors, the reflected, refracted, blinking, flashing, reverberating,noisome lights and the squawk and smash and kaboom kerpow of the overwhelming stimuli . . . you cannot, with your observations and facts, dispel the truths that everyone accepts . . . even though they have been shoved down their throats or forced up their ass*s. It’s ugly, yeah, but that does not mean that it isn’t also true.
Otherwise, hugs and kisses. . . .
Well said, Sir. “Soul-killing malestrom of NOISE”, indeed.
Just like there is a “big ponzi”, there is also a “big megaphone”.
Those are called “levers of power” and plebes, even wealthy plebes like Bonner, don’t get to go anywhere near those. Ever.
This raised a question in my mind related to the measles threads.
Measle parties for kids do not siphon money to Big Pharma, where shots do.
Both methods have their pluses and minuses, so why all the news generated noise lately for just the Big Pharma solution?
Bonner: You either lack critical thinking skills or just push socialism and open borders. Venezuela is just further down the road than London. Paris, SF, NYC.
Ironically, you compare London to San Francsico, NY, Paris. All have the same hell-bent progresive/socialistic, open borders “leadership’ and HAVE THE EXACT SAME RESULTS! Where is your data that London in no longer “pale and tired” – what a moronic set of ‘criteria’ to evaluate a city.
Firstly, it appears your whole set of “data” was collected by you during a sleazy hotel stay you had fifty years ago? Really? This is typical libard speak (write) you try to pass off as informed and knowledgeable. NOT SO, BOZO!
London’s wealth is DEBT, moron.
The domestic youth are godless, government ‘educated’, unemployed party animals – who DO come out at night, after the few who have jobs that afford them a decent lifestyle go home and lock up at night. You see, the bobbies do not worry about simple assault or robbery anymore – gotta spend the budget on social programs. Like Washington, DC, London is awash in ‘printed’ money, (QE) (ZIRP).
Violent crime in the jihadi Mayor Kahn’s London has tripled in the past five years – Open Borders??? Real data (something foreign to you) shows the cime is committed with machette, knives and axes by middle-eastern descent “folks” as barry 0 calls them. Oh yes, and some are ‘citizens’.
Paris has 3 christian church arsons per week – most notably, Notre Dame Cathedral at Easter. Muslim “NO-GO Zones” are real and the “diversity-makes-us -great middle eastern descent animals” burn their little slice of heaven every once in a while. I was there to withness this in July of 2006! Estimated 5000 care were alight – but that is good for the auto industry, right?
NYC is a foreign country; SF is literally a shit-hole. Your article should have been on the failure of all four cities and what they have in common – LIBERALISM/PROGRESSIVISM/SOCIALISM.
The real thieves are in Washington DC , living in Maryland you just use the tag of “Beltway Bandits” referring to the many companies off the DC Beltway 495 . All jockeying for a chance to suck on the big tit where money flows out with reckless abandon and nobody is held to account for it .
This is all part of what I have continuously described as the “Circle Jerk” . Wall Street to K-Street to Capitol Street , Wash Rinse Repeat to infinity !
The joint body of congress members and senators collude with the federal reserve who controls the treasury who controls the printing press . Now just the key strokes on the computer and billons flood the accounts of Wall Street banks from there it gets spread among all the real socialists in America , crony capitalists ! Millions go to K-Street where lobbyists of all shapes and sizes bribe senators and congressman for favors and the Beltway bandits get a contract . Billons circle thru this vile system daily . So what do the average American get from all this you ask ? In general absolutely nothing of real consequence other than debt piled on their backs bankrupt pensions more expenses on shrinking incomes .
BUT the circle jerk club members do great as do their paid government minions .
You will notice bright young people working for these Beltway bandits with last names the same as many in Congress although surely there is no real connection like Joe Biden’s son tied up in some corporate deal in the Ukraine or Hillary Clinton’s brother brokering a deal regarding uranium from the US to Canada and ultimately to Russia but “hey” move along nothing to see here because Trump got a blow job from a stripper and paid her to be cool about it OMG impeach blah blah blah ….
Meanwhile average Americans are hanging on by a thread and their children are either in debt for an education for a menial minimum wage job or have slipped thru the cracks of our education system (cracks that make the Grand Canyon look like a common drainage ditch) only to become hard core unemployable but most have a very high false sense of self esteem and think somebody needs to do something . Their needs somehow require an action from somebody else !
Where did they get that idea ?
The circle jerk ! Socialism works great for those at the top and those minions badged and armed or otherwise just doing their job maintaining the status quo as the nation circles the drain !
Well done public self servants !
London, the city of Muslim controlled no-go zones, is that what Bonner is praising? Nuts…
“Paper is poverty,… it is only the ghost of money, and not money itself.”
“If the American people ever allow the banks to control issuance of their currency, first by inflation and then by deflation, the banks and corporations that grow up around them will deprive the people of all property until their children will wake up homeless on the continent their fathers occupied.”
That purple tent is about 6x as big as the little blue tarp next to it. Goddammit, there is INJUSTICE even in tent cities!! I hope AOC jumps all over this shit.
And then there’s sanctions.
Venezuelan Girl Cannot Get Liver Transplant Due to US Sanctions
Trumpy, Bolty, and Pompy (TBP!) pretty much guaranteed that they were going to liberate the Venny peeps!! So, what went wrong??