LA PAMPA GRANDE, ARGENTINA – Comes word that the Democrats are up to more mischief.

Senator Brian Schatz (D-Hawaii) was expected to introduce a new tax bill earlier this week. The senator says his bill would tax the sale of stocks, bonds, and derivatives at a 0.1 rate. It would apply to any transaction in the United States. The senator says his proposal would clamp down on speculation and some high-frequency trading that artificially creates more market volatility.

This is the latest of many proposals to fund what the Democrats are calling a Green New Deal – that is, to further socialize the U.S. economy.

It’s not enough that medical care, education, retirement… and dozens of other industries are substantially socialized… or that Wall Street’s losses are socialized (the profits are still private – shared by the elite). The feds want to control even more.

Soft Socialism

Proponents typically look to Europe for guidance. They see Denmark, Sweden, and Norway and believe “soft socialism” isn’t so bad.

But there are many different forms of socialism. Bernie Sanders and AOC (Alexandria Ocasio-Cortez) could just as well draw inspiration from Nazi Germany or Mussolini’s Italy. Both economies were heavily socialized.

Between them – that is, 1940s Germany and Italy on one side, and present-day Scandinavia – is France… both geographically and ideologically.

And it is to the French that we turn to today… to see where this Green New Deal may be headed… and to mock one of its major proponents.

In this regard, we are especially fortunate. For there, we have not only a reliable reporter on the scene… but one of our own blood, who shares our sense of awe and amusement with the pretensions and conceits of public life… our son, Henry.

France has its “Green Deal” too, which it calls the “Great Transition.” The French feds are fully behind it… pushing an ambitious agenda, which aims to eliminate the internal combustion engine by 2050.

In 2017, they appointed a special cabinet-level officer, a Minister of Ecological and Social Transition, Nicolas Hulot. It is this goofball that we will make fun of today. For this week, he came down from the mountain with a plan worthy of a mental defective.

Paris Correspondent

Jesus only had two rules.

Moses brought 10 with him from Mount Sinai.

Mike Pompeo made 12 demands of Iran, or he would unleash the “strongest sanctions in history.”

Woodrow Wilson went to Europe with 14 points.

But Monsieur Hulot came up with an astounding 66 propositions! (Only Martin Luther outdid him, with 95 theses.) And here, we turn to our correspondent in Paris, with further details:

These [propositions] concern society, government, and the environment. And they’re completely wacko.

Mr. Hulot’s proposals bear on just about everything… all aspects of life. From the makeup of your neighborhood, to your job, to the insulation in your house, to the way people do business, to where your food comes from.

And then, there are the penalties… those are the funniest. You will be punished if your house fails to meet the standards of “eco-responsibility.” You will be punished if you drive a diesel car or truck. You will be punished if you invest to make money, rather than to support the Green New Deal. And you will be punished if you try to build… or pass to your children… an inheritance.

But Mr. Hulot is not doing this just to be mean. He loves humans so much… he just wishes there were fewer of them. And he wants them to live as he directs – getting checks from the government and living in well-insulated “social housing” projects.

But wait… it gets worse.

Mr. Hulot doesn’t lack imagination. Au contraire, he thinks he knows exactly what the earth and humanity itself should look like. And he wants to make it illegal for anything or anyone to be in any way different.

Most of his 66 propositions are simply calls for more taxes and more government spending. He wants, particularly, more housing, “public… and very public.” He wants the frog feds to condemn any house that doesn’t meet his environmental standards.

He also wants to stop employers from getting rid of non-performing workers. That is, you would not be permitted to fire or lay off employees, without government consent.

And, of course, he wants to increase taxes on wealth and on corporate dividends. There’s not much new about that. But what is new is even crazier.

Proposition 27

Henry continues…

Take Proposition 27, for example.

“Adjust executive pay according to the ‘social and environmental performance’ of the business, not just the financial results.”

We imagine that means that everyone from your butcher to your banker would get a bonus or penalty, determined by the government and not by the businesses themselves.

But what is “social and environmental performance”? And what will be left of French enterprise when the government decides the compensation of its executives? And if they’re going to do that, why not set the salaries of everyone?

That’s coming too. Hulot wants private salaries calibrated to the government’s minimum wages (Proposition No. 10) and “job classifications re-evaluated to increase pay for work that is mostly done by women” (Proposition No. 19)… and “upper limits on executive compensation” (Proposition No. 34)…

…But let’s go to another of his gassiest delusions. He also wants the feds to decide a business’ profit margin! Proposition No. 35:

“Negotiate the sharing of the profit margin inside the business and with its subcontractors.”

It’s mad. And terrifying.

And here’s one last one. He insists that the debt run up by the government to pay for all of his wackiness “won’t count.” Proposition No. 53: “Take out the ‘investments’ for the transition from the calculation of ‘public deficit’ from the European rules.”

[This needs a little explanation for American readers. Members of the European Union share a common currency, the euro. In order to protect the euro and the solvency of the Union, member countries are not allowed to run deficits of more than 3% of GDP. Back to Henry…]

This would take away one of the last practical barriers to infinite debt.

The bottom line is that your projects, your business, your money don’t count. What counts is what Mr. Hulot wants.

He stopped at 66 propositions. He probably could have gone on and added more.

Yes, Dear Reader, they can always come up with more. And coming your way. More taxes. More punishments. More projects. More goony things you have to do because they want you to.

They are already at the wheel in France. In America, fighting for control of the driver’s seat. But it hardly matters; they all seem to be headed in the same direction.

As for us at the Diary, we stay away from politics. We don’t care whether they call themselves socialists or Trumpistas; we just don’t like anyone telling us what to do.





By Dan Denning, Coauthor, The Bill Bonner Letter

If you believe in honest money and free markets that discover prices without the heavy, dead hand of the Fed on the scales, then you’re going to hate what I’m about to say.

Not only is quantitative tightening (QT) dead, quantitative easing (QE) – buying stocks, bonds, and real estate with money conjured out of thin air – may be here to stay.

In early February, San Francisco Fed President Mary Daly floated around the idea of making “the balance sheet” a permanent part of the Fed’s toolkit. By that, she means the Fed creating money (from nothing) to buy stocks and bonds (claims on earnings or future income payments).

Remember, the asset side of the Fed’s balance sheet expanded to over $4 trillion during the bailout of Wall Street and shareholders post-2008. And if the Fed were to buy riskier assets – especially, say, corporate bonds – it would force prices for these assets up… and the interest rate paid by them down. (Prices and interest rates move inversely in the bond market.)


So old-fashioned investors seeking income or yield – or pension funds relying on higher-yielding debt for their actuarial models to deliver future payouts – must then take greater risks with their capital to find yield. Or, they could just buy stocks and hope capital gains make up the difference.

The Fed calls this whole process “the wealth effect,” or the idea that, so long as stock prices go up, investors “feel” wealthier and the economy is “better off.”

And as I mentioned earlier, Daly thinks QE might be worth keeping around. Speaking with reporters in San Francisco she said:

An important question is, should those always be in the toolkit? Should you always have those at your ready, or should you think about, those are only tools you use when you really hit the zero lower bound and you have no other things you can do?

By “those,” Daly meant the bond-buying programs from the original versions of QE. Now, I don’t know Mary Daly. And it’s not my intention to draw any conclusions about her moral fiber or the content of her character. But I think you can safely assume her questions aren’t rhetorical.

They’re a trial balloon – a way of telegraphing to investors and the public that the Fed may go down the path the Bank of Japan has gone…

The Fed will use the balance sheet as another tool to control prices, prop up financial markets to prevent a mean-reverting crash, and work slavishly on behalf of financial asset owners for as long as possible. It will go “Full Retard,” as Bill would say.

And Daly elaborated, saying, “You could imagine executing policy with your interest rate as your primary tool, and the balance sheet as a secondary tool, but one that you would use more readily. That’s not decided yet.”

Right. It’s not decided yet…

We’d never commit to supporting financial markets with even crazier and riskier financial policies. I would say that you can “take it to the bank” that the Fed will make QE permanent, but banks just aren’t that reliable anymore.

Let’s not forget the price of all this. As Bill has been reporting in the Diary, there is no “we.” “We” did not get richer thanks to the Fed’s extraordinary monetary policy. Stockholders did, particularly the ultra-wealthy.

The other thing Bill has gone to great lengths to demonstrate is that the Fed does not create wealth. It can only take wealth from others and give it to somebody else.

In this case, it took the prospect of earning decent interest on your savings account away from ordinary Americans and gave even more wealth to Wall Street and the One Percent.

I call this the “financialization” of the American economy. And it’s tearing the country apart politically. But the Fed has decided to make it worse, as a matter of policy…

Dan Denning


The Real Problem With Buybacks
Stock buybacks are a favorite tool of corporate CEOs. A company, in essence, purchases its own shares and then “erases them.” This raises the price of the remaining shares, making stockholders richer. Critics say companies ought to spend less money buying their own shares and more on expanding business operations. But that’s not the only strike against buybacks…

How to Trade MMT
There’s no avoiding it. The MMT (Modern Monetary Theory) wars have begun. The theory, which broadly says that – so long as inflation is low – there’s no reason the government can’t print and spend as much as it likes, is the newest buzzword in economic circles. Many on Wall Street are still grappling with it. But others are asking a more immediate question: Can we profit from it?

But read also…

Modern Monetary Tyranny
Bill recently said MMT was a “substitution for common sense.” Dan Denning, Bill’s coauthor on The Bill Bonner Letter, believes it’s worse than that. It’s nothing short of a death sentence for the middle class. And it’s on its way… fast.


In the mailbag: Trump’s “gallant effort”… Why doesn’t AOC move to Venezuela?… and “if that man gets reelected, I’m moving to New Zealand.”

At least Trump is a president that is trying to make peace and progress, rather than Obama’s method of giving these idiots our hard-earned government cash. Maybe you need to put that in your Diary! I hardly think the North Korea talks were a collapse, and if they were, he at least made a gallant effort!

– Kirk M.

I’ve always wondered why people like Bernie Sanders and AOC, who like socialism so much, don’t just move to places that already have what they want in place. Places like Venezuela, Russia, China, etc. I guess it’s because they might disappear in the middle of the night without a trace – like the Chinese billionaire I read about recently in one of the missives – when they don’t follow the party line. God help us, if that ever comes to pass in the USA.

– John F.

If this guy is reelected, I will seek political asylum in New Zealand. You’re such an intelligent person and a brilliant writer. But if you would even think of going into the voting booth and actually voting for Trump, then I’d be worried about you. I know an excellent therapist who could help.

– Charles S.

Generally speaking, you’ve done quite well over the years and have great insight. However, in certain areas you now seem to be influenced by the liberal media, which is about as off-track as you can get. So while you’re on track on many things, you’re being misled in at least one key area. Please stop immersing yourself in the liberal media. On certain key topics, you’re parroting them and speaking obvious nonsense.

– Nicholas P.

Hey, Bill… Instead of looking at it as a handout that increases the deficit, I think we should look at it as an investment into the future. I really liked the pictures. Thanks for all you do to broaden our perspectives…

– Dale Y.