Economy

The Guns of January

By David Stockman  |  January 6, 2020

Every gun that is made, every warship launched, every rocket fired signifies in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed. This world in arms is not spending money alone. It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children. This is not a way of life at all in any true sense. Under the clouds of war, it is humanity hanging on a cross of iron.

– President Dwight D. Eisenhower, The “Chance for Peace/Cross of Iron” Speech (April 16, 1953)

Stock futures pointed to a particularly ugly first Monday of the new year, as fresh tensions with charter “Axis of Evil” member Iran spooked just about everybody not immersed in MAGA.

Over the weekend, after the Tweeter-in-Chief ordered the assassination of Quds Force honcho Qassem Soleimani, the Islamic Republic cancelled all commitments that remained under the infamous “nuclear deal.”

And Iraq’s parliament – an ostensibly democratic body established as part of our “regime change/nation-building” efforts in the Middle East – voted to oust U.S. troops from within its borders.

The Donald is still out on point, though, threatening to bomb 52 cultural sites in Persia, the number representing the 52 Americans taken hostage at the U.S. embassy in Tehran during the 1979 revolution that deposed the Shah and installed the Ayatollah Khomeini.

Folks, this president is a bungler; this is not some brilliant “three-dimensional-chess” gambit.

But even a bungler – maybe especially a bungler, in this particular context – can be a Great Disruptor.

Well, this is what happens when you make a Warfare State, prosecute Forever War, and put perhaps the single most impulsive man on the planet in charge of it all.

The Duopoly created the environment that made the Donald a political force. It also built the machine he’s threatening to unleash against, basically, all comers at this point.

What comes next is on Imperial Washington.

It’s worth it to take a step back from the present brink and understand how we got here.

After the Berlin Wall fell in November 1989 and the death of the Soviet Union was confirmed two years later when Boris Yeltsin courageously stood down the Red Army tanks in front of Moscow’s White House, a dark era in human history came to an end.

The world had descended into a 77-year war, incepting with the mobilization of the armies of Old Europe in August 1914. If you want to count bodies, 150 million were killed by all the depredations that germinated in the Great War, the foolish aftermath at Versailles, and the march of history into World War II and the Cold War that followed inexorably thereupon.

Upwards of 8% of the human race was wiped out during that span. The toll encompassed the madness of trench warfare from 1914 into 1918; the murderous regimes of Soviet and Nazi totalitarianism that rose from the ashes of the Great War and Versailles; and then the carnage of World War II and all the lesser, unnecessary wars and invasions of the Cold War, including Korea and Vietnam.

At the end of the Cold War, therefore, the last embers of the fiery madness that started with the guns of August 1914 had finally burned out. Peace was at hand. Yet, 29 years later, there is still no peace.

That’s because Imperial Washington confounds it.

In fact, the War Party entrenched in the nation’s capital is dedicated to economic interests and ideological perversions that guarantee perpetual war. These forces ensure endless waste on armaments; they cause the inestimable death and human suffering that stems from 21st century high-tech warfare; and they inherently generate terrorist blowback from those upon whom the War Party inflicts its violent hegemony.

Worse still, the Duopoly’s great war machine and teeming national security industry is its own agent of self-perpetuation. When it’s not invading, occupying, and regime-changing, its vast apparatus of internal policy bureaus and outside contractors, lobbies, think tanks, and NGOs is busy generating reasons for new imperial ventures.

So, there was a virulent threat to peace still lurking on the Potomac after the 77-Year War ended. The great Dwight Eisenhower had called it the “military-industrial complex” in his farewell address. But that memorable phrase had been abbreviated by his speechwriters, who deleted the word “congressional” in a gesture of comity to the legislative branch.

So, restore Ike’s deleted reference to the pork barrels and Sunday-afternoon warriors of Capitol Hill, and toss in the legions of Beltway busybodies who constitute the civilian branches of the Cold War armada, and the circle is complete.

It constitutes the most awesome machine of warfare and imperial hegemony since the Roman legions bestrode most of the civilized world.

The real threat to peace circa 1991 was that the American Imperium would not go away quietly into the good night.

In fact, during the past 29 years, Imperial Washington has lost all memory that peace was ever possible at the end of the Cold War.

Today, it is as feckless, misguided, and bloodthirsty as were Berlin, Paris, St. Petersburg, Vienna, and London in August 1914.

Give This a Chance…

This is the most politicized market in history. And the Tweeter-in-Chief is still in charge. So, the situation is changing almost by the minute.

It’s “Impeachment!” in Imperial Washington and all over the Mainstream Media. It’s “Easy Money!” on Wall Street and across Bubblevision.

And it seems as if the whole world has, indeed, gone mad.

Amid this chaos, prices will continue to rise and fall, trends will continue to develop and dissipate.

Well, The Stockman Letter is made for times like these. And we’ve updated our design to help us better navigate to not only the safest harbors but also the most promising opportunities.

The stakes are as high as they can be heading into 2020. Markets appear to be straining, catching up to an economy that’s been weak and getting weaker for years.

The Donald is tied up in the day-to-day movements of the major stock indexes like no president before him. The increasingly desperate incumbent will do anything he must to hold the White House.

It’s a major tipping point. And there’s no telling what the Donald’s great disruptions could do to your wealth.

You’ve got to be nimble to win in this market…

To common sense.

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David Stockman

David Stockman is the ultimate Washington insider turned iconoclast. He began his career in Washington as a young man and quickly rose through the ranks of the Republican Party to become the Director of the Office of Management and Budget under President Ronald Reagan. After leaving the White House, Stockman had a 20-year career on Wall Street.MORE FROM AUTHOR