| By Bill Bonner Tuesday, November 17, 2020 – Final Day of the Quarantine SAN MARTIN, ARGENTINA – Marta works for us at our house at the ranch. She comes down from her mountain puesto (outpost) on foot, a hike of about six hours. She and her family are about as unsophisticated about money as anyone in Christendom. They live in a mud house, with a dirt floor and no microwave nor washing machine. Their hands are as hard as boot leather. They get no newspapers. They see no TV. They are not readers of the Diary. But even Marta is hip to the dangers of inflation. "Could you change pesos for dollars?" she asked on Saturday. You know you are near the end of a stock market bubble when taxi drivers begin giving you stock tips. But where are you when subsistence farmers high in the windswept Andes begin to trade currencies? Losing Value Marta's father, Martin, has saved 300,000 pesos – accumulated over a lifetime of hard work. His pile, in a single stack of bills, measures more than a foot high. At today's black market exchange rate, it is worth about $2,000. But if Martin keeps this money in a lumpy mattress, it could soon be worthless. A lifetime of savings – poof! He has no bank account. He has no credit card. He has nothing other than a wad of cash… and no easy way to protect himself against Argentina's currency debasement. Inflation in Argentina is running at about 50% per year. The country has been strictly locked down in an attempt either to stop the coronavirus… or to provide an excuse for the developing economic disaster. In either case, the shutdown seems to have accomplished little – the coronavirus death rate is about the same here as in the U.S. And the economic crisis has gotten worse. We have no way of knowing what will happen next. But if history is any guide, pesos will continue to lose value against the U.S. dollar. And then, the dollar will lose value against everything else. The post-1971 dollar has already lost 96% of its value, in terms of gold. In the years ahead, it will almost surely lose the rest of it. | Recommended Link | | ⏰ One Day LIGHTNING Trade Pays 183%? ⏰ Short-term trading is FUN. And once-in-a-lifetime gains can hit LIGHTNING FAST: -
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States are telling families not to get together for Thanksgiving. Santa is shopping for a face-protector. The second reason is even more absurd. Now that Sleepy Joe Biden is packing up for his move into the White House, investors expect the fake money to flow as promiscuously as it did under Trump. There may even be more of it. Nancy Pelosi and Chuck Schumer announced last week that their last proposal – $3.4 trillion of additional fake money – was now just a "starting point." Is this "normal?" And the Federal Reserve is "printing" new money – debasing its own currency – at the rate of $11 billion per day. Is that "normal?" Don't Be Left Empty Handed — Why Banks Bought 1,300 Tons of Gold. Grotesque and Unnatural Far from it. The whole program – spend, borrow, print… boom, bubble, crash… pain, panic, bailout… spend, borrow, print… boom, bubble, crash… pain, panic, bailout… – is grotesque and unnatural. And the weak link in this freakish chain is the U.S. dollar. The feds can print 'em. But they can't control their value. COVID-19, along with lockdowns and lockups, have caused people to be fearful. Savings rates have gone up. The velocity of money – a key to the value of the dollar – went down sharply… exaggerating a trend that has been going on for almost a quarter of a century. Consumer spending, meanwhile, went up – thanks to the feds' excessive giveaways. Economists, naturally, mistook this spending for "growth"… and a "recovery." But it was nothing of the sort. It was as fake as the whole shebang. The recovery… the dollar… interest rates… stimulus – all phony baloney. Faster Money But wait… what's this? The St. Louis Fed reports that the "velocity" of money – the rate at which money changes hands – has suddenly turned up. Is it a blip? Or a trend? Nothing worth mentioning? Or time to high-tail it out of town? We don't know. But the smart money is selling dollars. Here's Zero Hedge: In a Friday note from Goldman's chief FX strategist Zach Pandal, he predicts that "depreciation in the broad Dollar can continue in 2021" and writes that his USD cross forecasts translate into a 6% decline in the broad trade-weighted Dollar index over the next 12 months, and a "sustained but orderly" 15% real depreciation from its 2020 peak to the end of 2024. Is this the beginning of the end for the fake dollar… the fake interest rates… the fake stimulus… the fake bailouts… the fake recovery… the fake stock market boom… and all the rest of the fakiness? It is too early to tell. Farewell Asado In the meantime, let us finish our story of the asado we held at the weekend to bid our friends and neighbors goodbye. A sheep had been slaughtered on Saturday… By 9 in the morning on Sunday, it was roasting on an open fire, its legs stretched out as if crucified. It is rare to eat a sheep. Typically, we eat a cordero (a male lamb). Sheep reproduce; we don't like to give them up. "This sheep was sterile," explained the foreman. "She wouldn't lamb." We began the lunch with a toast… a "thank you" from Don Bill… followed by a blessing. We all crossed ourselves and sat down to eat, our seven cowboys along with their families. The cowboys and your editor sat at the head table. The women and children sat at another… Even Samuel was there. Samuel looking hale and hearty Samuel was thrown from a mule last week. He was still seeing double when we visited him in the local clinic. He described what happened next: "They took me up to Salta and put me in a machine to look at my head. They didn't find anything, so they brought me back yesterday. I'm fine." "How many fingers am I holding up?" we asked him. "Just checking." "Four," he replied, smiling (we only had two in the air). An asado is no place for a vegetarian. It begins with meat… and then the meat continues… fresh off the grill, for at least an hour. First come the sausages. Then comes the beef. Then the mutton. And then the sausages again… all hot and dripping with grease. The grease was cut with a lavish flow of our own wine… as well as Coca-Cola. Sometimes, the locals mix the wine and Coca-Cola together to make a "South American cocktail." Strange Holdings In Buffett's Portfolio… Flowing Conversation At first, the cowboys are timid in front of Don Bill and La SeƱora. But after a few courses of meat… and a few bottles of wine… the conversation becomes looser and faster. "Hey Samuel," said Javier across the table. "They took a look inside your head and didn't find anything. That's what I thought." Everyone laughed. "I told them they were wasting their time," Samuel replied, playing the straight man. He took out his phone, as if it had rung. "This must be that cute little nurse at the hospital. She said she didn't want me to leave." "Yeah," replied Javier. "In the city, they don't get many people who fall off mules. "We're going to need more safety precautions around here," Javier continued. "Samuel is going to have to wear a helmet when he rides a mule. " "And a seat belt," said one of the others. They were enjoying themselves. But the looser the conversation became, the harder it was for the gringo to understand it. They were using their mountain slang… incomprehensible to an outsider. Outside World Meanwhile, Elizabeth was doing the serious work. Sitting with the women, she was getting the low-down on what was going on. The people of the ranch are remarkably hard and tough. But they often find it difficult to synchronize with the outside world. One of them described what it was like for her when she left the ranch for the first time, aged 15, to go to school in the city. "It was such a shock. I didn't understand anything. I didn't know how to cross a road. I'd never seen running water – in the house. Electric lights. Automobiles. TV. It was all new to me. "At first, I wanted to come back to the ranch. It all scared me. I felt alone. Nothing was familiar to me. I was with girls who had never seen a live cow. They thought beef came from the supermarket. And they laughed at me because of the way I talked." Those who leave for the city quickly become hip to modern life. But those left behind often need help. Hospital Visit "They told me about Camilla," Elizabeth explained later. "What about her?" "You remember… she had a baby. She's only 18, but she had a baby. And then, she couldn't walk. They didn't know what was wrong with her, so they took her to the clinic. And the doctor there sent her up to Salta. "They discovered that she has a tumor on her backbone. They're testing now and deciding what to do. "But she's in the hospital, with no family to look out for her. And they took the baby away, because she couldn't take care of it. They didn't seem to know what they were going to do with the baby. "The poor girl is up there… She really needs her mother. But I think the mother is afraid to go up to the city. She doesn't know where she would stay… or what to do there. "I told her that we could take her up there and rent a little apartment on AirBnb… or something. We could figure it out. But I think she's just terrified by the idea." "I'll go to visit Camilla, before we go to the airport," Elizabeth offered. "If they let me into the hospital." More to come… Regards, Bill
Like what you're reading? Send your thoughts to feedback@rogueeconomics.com.
MAILBAG One dear reader shares his thoughts on the U.S. COVID-19 situation… There is much truth to your assessment of our reaction to COVID. But it is also true that the number of deaths isn't the virus's biggest impact (although it is more lethal than regular flus). The larger impacts are the number of hospitalizations, which are greatly straining healthcare systems, even in developed nations, and the unusual longer-term effects of COVID on a significant number of old and young alike – damage to organs (especially heart, lung, and kidney), and months-long recuperation, in many cases. It's not as cut and dry as you imply. – Gary M. Meanwhile, another gives his take on Donald Trump's presidency… Trump who has not had a vision for this country. It is all about Trump; it's not about this country, it's not about his base/supporters, or the people. Donald Trump's presidency is all about himself. Trump took advantage of the seat of presidency, just like before he became the sitting president. We all know his tactics of lies and deceit; that's who he is. Trump has no truth in him. He had no good purpose for this country, and it is evident that he lost. He is not a big man… It takes a big man to admit he lost, to admit he failed, to admit he, too, has weakness. But he is none of those things. – Mel E. And finally, a dear reader is sorry to see Bill leave Argentina… I have been enjoying your tales and stories about your meanderings. It has been fascinating and a real pleasure to follow. But all good things must come to an end, I suppose. Maybe we can someday even put the evil spirit called COVID-19 to rest. But that would mean eliminating the fear in the people behind the masks; not going to be an easy task. Thank you for your stories, comments, and wisdom. And most of all, for your common sense… – Benny J. Have any of your friends or loved ones been sickened with COVID-19? Do you agree with Mel, that Donald Trump "has no truth in him"? Write us at feedback@rogueeconomics.com. IN CASE YOU MISSED IT… Millionaire's Big Prediction From Living Room Couch Teeka Tiwari – America's No. 1 Investor – just made an outrageous prediction. Recorded live from his living room couch... He blasts Congress, reveals nasty truths about America… And reveals one technology set to radically change our nation. Already, 400,000+ viewers have checked it out. WARNING: This video may make you furious. Watch His Urgent Video Now. 
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