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Beneath the Surface

Big Money

Loading ...Bill Bonner

December 24, 2024 • 3 minute, 41 second read


debtpolitical trend

Big Money

Bill Bonner, writing today from Baltimore, Maryland

Forbes:

Biden forgives $4.28 billion in student debt for 54,900 borrowers

The relief is a result of fixes the U.S. Department of Education made to the once-troubled Public Service Loan Forgiveness program.

Where did Joe Biden get the power to spend Americans’ money without asking Congress?

Who knows?

But while the president was doing unconstitutional acts… the markets were making unconscionable moves. Fortune:

Fartcoin hits $1 billion market cap as memecoin market explodes

And then, as expected… rather than force the feds to actually reduce spending, Republicans got together and agreed to spend even more. Tampa Free Press:

House Republican leaders have announced an internal agreement on a stopgap spending bill, also known as a continuing resolution (CR), to fund the government through March 2025, averting a looming shutdown set for Friday night. The proposed CR includes $110 billion in disaster relief for victims of Hurricanes Milton and Helene, along with a one-year extension of the farm bill, according to multiple reports.

What a lovely Christmas pageant it is! A grand parade of fools and knaves. A circus of freaks and clowns.

Yes, here at Bonner Private Research we are enjoying the show. But we’re closing up shop for the holidays. Our readers have more important things to think about than politics, economics, or investments.

But our goal is to prevent you from taking the Big Loss… and to that end, we bring some last-minute thoughts.

We believe we are watching a struggle between money and power… between Musk and Trump…between the Primary Political Trend of at least the last 50 years and (possibly) a new direction. Money wants a freer economy… with the usual grift and corruption. Power wants what it always wants — more power.

The outcome is in doubt… but many investors are anticipating a huge ‘melt-up.’ They think they face a once-in-a-lifetime opportunity, a new era created by the new MAGA-istas.

We hope it works out.

But just in case … here’s our contrary view…

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Almost all commentators, on the left and the right, have it wrong. They think we are looking at a struggle between conservatives Trump/Musk/etc on one side and the establishment, wokish, war-mongering liberals on the other.

If that were true, we could take our places in the bleachers, rooting for a victory for the conservative cause, hoping for lower deficits, lower inflation, lower interest rates — and a less expensive, less powerful government.

Then, we might even expect a business revival. Manufacturing would return to the US… and thousands of rapists and murderers would leave.

But that is not what is on offer.

The Republican elite, now including Donald Trump, have a very different agenda from Elon Musk. They spent a lot of time and a lot of money getting power. They’re not going to want to give it up. Instead, they’re going to use it in the same way elites always use government — to take money and power away from ‘The People’ and give it to themselves.

That has been the Primary Political Trend for at least 50 years. It will change at some point, but typically, not until some catastrophe comes along and the elites run out of other peoples’ money.

And that suggests that at some point in the not-too-remote future, Messrs. Musk and Trump are headed for a showdown. Mr. Trump is now the most powerful man in the world. He wouldn’t want to see his face taken down from Rushmore… even before it gets there, or share power with a rich guy from South Africa.

Besides… he has his weight to throw around. Bloomberg:

President-elect Donald Trump warned the European Union that its exports will get hit with US tariffs if its member states don’t buy more American oil and gas. 

“I told the European Union that they must make up their tremendous deficit with the United States by the large scale purchase of our oil and gas. Otherwise, it is TARIFFS all the way!!!,” he said on Truth Social.

Big Man politics require a Big Stick… which costs Big Money. It seems very unlikely that Trump would give up the pleasure of power for reasons he neither understands nor appreciates.

Look for bigger deficits, not smaller ones. And lower asset prices, not higher ones. And if we’re wrong…

Well, it won’t be the first time.

Happy holidays.

Regards,

Bill Bonner


Adam O’Dell: Gold’s $5,000 Moment?

October 17, 2025 • Adam O'Dell

Regardless of anyone’s personal opinion on Trump, it’s clear that the international community is translating his “Putting America First” agenda as something more like “Every Man for Himself.” That could have a profound impact down the line, not just for our future trade prospects, but for the health of the economy and the U.S. dollar at large (which is still the world’s dominant reserve currency, for now).

At the same time, this is all very bullish for gold, as central banks are likely to continue buying for years to come. In this kind of situation, gold hitting $4,300 and continuing to rise higher was a foregone conclusion, and it’s clear that Trump’s agenda is locked in and unlikely to change.

Adam O’Dell: Gold’s $5,000 Moment?
A Credit Crisis Reprise

October 17, 2025 • Addison Wiggin

Shares of regional banks and even investment bank Jefferies were hammered Thursday after fresh revelations from Zions Bancorporation and Western Alliance Bancorp.

Zions dropped more than 13%, Western Alliance fell 10%, and the SPDR S&P Regional Banking ETF (KRE) plunged over 6%, with all but one member ending the session in the red. It’s not the size of the losses — it’s the pattern that’s unsettling, in what are ongoing ripple effects from the banking crisis that rocked regional banks in early 2023.

A Credit Crisis Reprise
The Banking Crisis That Was

October 17, 2025 • Addison Wiggin

Yesterday, Zions Bancorporation and Western Alliance Bank dropped 13% and 10% respectively, dragging the S&P 500 down with them.

In pre-market trade this morning, the broader banking sector also got whacked. JP Morgan was down 1.5%, while Citi fell 1.9% and Bank of America was down 2.9%. In Europe, meanwhile, the regional Stoxx Banking Index fell almost 3%.

The Federal Reserve stopped tracking “unrealized losses” at regional banks in 2022. But occasionally, a snippet of data will come to light, like this piece from the FDIC earlier this year.

The Banking Crisis That Was
How Much Gold Does China Really Have in 2025?

October 16, 2025 • Dominic Frisby

History’s “golden” rule will soon apply again.

How Much Gold Does China Really Have in 2025?