Bill Bonner Back in the USA

We’re back in the USA after 15 years of living in Europe.

Bethesda is one of America’s wealthiest suburbs. Money from all over
the nation rolls this way. The playing field is tilted in Bethesda’s

“I was sitting in the Starbucks, having a cup of coffee,” Elizabeth
reported. “One man next to me was on the phone. He was talking about
some deal he had done with the US Army in Afghanistan. It sounded as
though he was very happy with it. The man next to me on the other side
was on the phone too. He was a jollier fellow, talking loudly about how
much money he had made. I thought he was a stockbroker or something
like that. Then, I realized he was talking about a contract with the

While the rest of the nation has suffered a setback over the last ten
years…the Washington metropolitan area has boomed more than ever.
Real estate prices are down…but less than other areas.

And when we looked for a house to rent, we expected to be able to name
our price. We thought it would be a buyer’s market. Not so. Nice houses
in Bethesda are still being sought after. How so?

Wars…bailouts…boondoggles – this area loves them. Federal
employees’ earnings keep going up…and a higher portion of the US
national income goes to Washington.

“Aughts Were a Lost Decade for US Economy, Workers,” says a headline in

The Washington Post.

“For most of the past 70 years, the US economy has grown at a steady
clip, generating perpetually higher incomes and wealth for American
households. But since 2000, the story is starkly different.”

What was different about it?

“There was zero net job creation in the first decade of this new
millennium, compared to healthy job growth in each of the previous six
decades,” continues the report.

“No decade going all the way back to the ’40s had job growth of less
than 20%.”

How many jobs were created since 2000? None. Not a single one, net.

If new jobs are not being created, you can’t expect working people to
do very well. And they didn’t. “The Aughts were the first decade of
falling median income since figures were first compiled in the ’60s.
And the net worth of American households – the value of their houses,
retirement funds and other assets minus debts – has also declined when
adjusted for inflation, compared with sharp gains in every previous
decade since data were initially collected in the 1950s.”


The Aughts were a nasty decade for investors too. Bloomberg reports
that the value of all the world’s public companies was a bit more than
$60 trillion at the end of 2007. Stocks were cut in half in ’08. In
’09, after the March low, the bounce began. They recovered roughly half
of what they lost to end 2009 with a total value of about $45 trillion.

Bummer again.

What went wrong? According to the Post account, economists are
scratching their heads wondering. What a bunch of morons!

Long-time sufferers of Markets and Money already know what went
wrong. GDP figures were positive throughout almost the entire period.
But they were phony…they were a fraud. They just measured the rate at
which Americans were ruining themselves – by buying things they didn’t
need with money they didn’t have.

It was obvious to us and anyone who bothered to think about it for two
seconds that you can’t really get rich by spending money. It’s NOT
spending that makes you rich. It’s savings. You have to save and
invest…so that you can produce more. Everybody knows that.

But economists don’t work for ‘everybody.’ They work for the
government…or Wall Street. Both sectors have a keen interest in
making people believe in what isn’t so. ‘We live in the greatest, most
flexible, most dynamic economy the world has ever seen,’ said the
politicians. ‘Yeah…and it will only get better,’ added Wall Street.

But it was a fraud. It didn’t get better. It got worse. And now,
Americans pay the price. Ten years of work…and they’re poorer than
when they started.

The Aughts were ruined by Wall Street. Washington will ruin the next
decade. It will take the lead in spending money it doesn’t have on
projects it doesn’t need. It will lavish money on parasites: Those
fellows in the Starbucks…39 million people on food stamps…AIG
executives…much of Wall Street…most of the federal payroll.

Instead of competing actively in the world economy – providing goods
and services to honest people who are willing and able to pay for them
– these people depend on government.

And now, the whole US economy depends on government too – just like the
Japanese economy. Now we need (or so we are told) big spending from
Washington, or the economy will stop growing. But the ‘growth’ we are
seeing now is not real growth – it is growth in government spending.
And like all government spending, it rewards parasites, not the people
who actually add wealth.

But heck…it’s a New Year. We’ll look ahead. What’s coming up? Another
ten years of backsliding? Or ten years of real growth? Better? Or
worse? We’ll bet on the backsliding… keep reading.

Bill Bonner
for Markets and Money

Bill Bonner

Bill Bonner

Since founding Agora Inc. in 1979, Bill Bonner has found success and garnered camaraderie in numerous communities and industries. A man of many talents, his entrepreneurial savvy, unique writings, philanthropic undertakings, and preservationist activities have all been recognized and awarded by some of America’s most respected authorities. Along with Addison Wiggin, his friend and colleague, Bill has written two New York Times best-selling books, Financial Reckoning Day and Empire of Debt. Both works have been critically acclaimed internationally. With political journalist Lila Rajiva, he wrote his third New York Times best-selling book, Mobs, Messiahs and Markets, which offers concrete advice on how to avoid the public spectacle of modern finance. Since 1999, Bill has been a daily contributor and the driving force behind Markets and Money.
Bill Bonner

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2 Comments on "Bill Bonner Back in the USA"

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“not the people who actually add wealth…” are we talking the other madoff’s on wall street? those less than loveable rascals in D.C.? those SUV mom’s having the DTs and mumbling about much much more for education as the precious little ritalin heads are “building hang gliders to get to mars”? is it the old folks working at MaoMart as greeters to pay for their medications? how come shills pumping and dumping stocks, socialites showing off their face lifts and boob jobs on tv, and some atheletes running around in circles get the big money, while those dark skin folk… Read more »

Baal… there is no earthly way of knowing… which direction we are going. There is no knowing where we’re rowing, or which way the river’s flowing. Is it raining? Is it snowing? Is a hurricane a’blowing? Not a speck of light is showing so the danger much be growing. Are the fires of hell a’glowing? Is the grisley reaper mowing? YES! The danger must be growing for the rowers keep on rowing AND THEY’RE CERTAINLY NOT SHOWING ANY SIGNS THAT THEY ARE SLOWING!!” – Willy Wonka, Willy Wonka & the Chocolate Factory.

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