America’s Savings Are Trapped in a Bubble


John Doerr, the venture capital zillionaire, thinks America should go all-in on measures to control the weather. Although Doerr fears it may be too late to save Earth and its inhabitants from the ravages of global warming, he says a massive investment program would still be better than doing nothing. His role model is FDR, who put America on war footing with astounding speed after the Japanese bombed Pearl Harbor. The tycoon and those he hobnobs with have so much money that they could be forgiven for being unaware that America is broke. Sure, there’s plenty of ‘wealth’ tied up in stocks, bonds and real estate. But valuations are so pumped with hot air that we might as well write off three-quarters of it, since it will vanish anyway in the next bear market.

Plunging share prices will bring many painful epiphanies, including the realization that every dime of the nearly $30 trillion owed by the U.S. Government– which is to say, owed by taxpayers — will have to be repaid: if not by borrowers, then by lenders. That is the inexorable logic of deflation, and when it comes we will be too busy dealing with the implosion of Social Security, Medicare and Baby Boomer retirement plans to be gung-ho about taming the weather, were this even possible.

Democrats to the Rescue!

By then, Americans won’t feel much like spending tens of trillions of dollars for coal-plant scrubbers, thorium reactors, Wyoming-sized solar arrays and recapturing methane at wellheads. Galloping to the rescue, Democrats will propose a new tax on gasoline to jump-start ‘Build Back Weather’. But the sums required just to get to the first stage of this guaranteed boondoggle would dwarf whatever could be raised with a surcharge of even $10 a gallon, not that anyone would still be driving.

It’s a wonder that anyone, particularly a savvy financier like John Doerr, could believe the capital exists to attempt the rebuilding of America, let alone try to turn Motherf**ker Nature uncharacteristically benign. Tens of trillions of dollars of gaseous savings are tied up in glorified advertising firms like Google and Facebook, in profitless food delivery services, driverless car- and other AI-hubris, and in purveyors of burritos, virtual entertainment and trendy consumer goods. That is what economists mean when they refer to malinvestment: the channeling of savings — in this case vast sums of it — into companies that either sit on it, squander it, or use it to buy back their own shares. Stocks have become grotesquely overvalued as a result, and it is delusional to think any significant portion of the hoarded capital can ever be freed up to rebuild America’s dilapidated cities, highways, bridges, transit systems, railways and airports. The savings are illusory to begin with, and even if every penny could be diverted into infrastructure, it is absurd to think the bumblers, grafters and big-business lackeys on Capitol Hill could incentivize the process so that it would create anything of enduring economic value.

  • Rich November 15, 2021, 12:22 pm

    Past Rick Pick Rye Patch Mining ARNGF
    Target + 78 % from 3.02 to 5.38
    Currently overbought

    S.TO Target + 67 % from 0.42 to 0.7
    SHERF Target + 48 % from 0.344 to 0.51
    Currently under accumulation

  • [email protected] November 15, 2021, 11:46 am
  • Ben November 15, 2021, 11:21 am

    They’ve since repaired and reopened the I40 bridge, but it must have been by divine intervention that it didn’t collapse well before they were able to. So, apparently, the lesson to walk away with here is that the only way any infrastructure in this country ever gets some much-needed attention is when it becomes glaringly obvious or perhaps even in wake of a big disaster. Whichever comes first.

  • Rich November 15, 2021, 11:06 am

    One of your truest Rick.
    Interesting how so-called liberals prefer fascist solutions.
    Our hunch is the Greatest Deflation may not leave bonds, equities, mortgages or unfunded government mandates paying or standing let alone trading.
    So we just bought SHERF, 94 year-old global leader except USA down from 18.92.
    Cobalt, fertilizer, gas, nickel, oil power in Canada, Cuba, Madagascar.
    Good for EV skateboards.

  • DanielK11980 November 15, 2021, 8:01 am

    Another interesting one, Rick.

    Naturally, Bill Gates wants in too but that seems to have hit a road block and doesn’t care for the natural effects of soot launched from Volcanoes which happen to be pretty active all over the place in recent memory:

    There is widespread denial that this kind of activity even occurs, or is possible, even though previously undisclosed
    documents show that “Operation Cumulus” was being actioned by the British Royal Air Force back in 1952, which caused flooding and 35 lives were lost:

    Russia spend a good chunk of money to prevent May Day from being a wash out:

    China has used similar methods.

    Anyway, hope everyone out there is taking good care of themselves!