Bill Bonner Predictions in 2023: Nightmare Winter Warning?

Bill Bonner is an author specializing in the fields of economics and financial markets. He founded the Agora Financial publishing company in 1979. He has co-authored books such as Financial Reckoning Day: Surviving The Soft Depression of The 21st Century and Empire of Debt.

Bonner’s writings and articles have been published on several platforms across the years, and he served as a director of MoneyWeek between 2003 and 2009. Today, investors who are interested in Bonner’s predictions for 2023 and his views on markets and finance can read his articles on Bonner Private Research.

In this article, we’ll highlight Bill Bonner’s predictions for the economy and the stock market. We will place a particular focus on Bill Bonner’s 4th prediction, which is forecasting an energy crisis and hyperinflation in the United States.

Bill Bonner’s predictions

In his career of over 50 years, Bonner has made some prescient predictions that have earned him a loyal audience. 

Bill Bonner’s first major prediction came in the 1980s, when he warned investors about an impending crash in the Japanese stock market. The prediction materialized in the second half of the 1980s and the Japanese stock market hasn’t recovered to its previous all-time highs since.

Bonner’s second key prediction came in the late 1990s, when he expressed concerns about the dot-com bubble and predicted its eventual unraveling. Bonner identified that the speculation surrounding dot-com stocks had exceeded all reason.

In 2005, Bonner published his third major warning, which came in the book Empire of Debt. In the book, Bonner warned about a crash in mortgage finance and real estate that would have a severe impact on the housing and stock markets, but would leave the US dollar and bonds relatively unscathed.

What is Bill Bonner’s 4th prediction?

Bonner is calling this prediction his “fourth and final warning”, and says that while the crashes he has predicted in the past have mostly just affected investors, the scenario he is predicting now will impact everyone. If you’re interested in Bill Bonner’s 4th prediction, you can view it in video form below.

Energy crisis in the U.S. and hyperinflation

Bill Bonner’s 4th prediction forecasts an energy system collapse in the United States which would result in a bigger crisis than COVID-19. Bonner calls this forecasted crisis “America’s Nightmare Winter”.  

“Fuel won’t get delivered. Rolling blackouts will sweep the land. Pipes will freeze. Food in the freezer will go bad. You may shiver in the dark… praying for a little power – for weeks.”

According to Bonner, the strong reliance of supply chains on diesel fuel is a weak spot that could unravel in a matter of days. Diesel plays a key role since it fuels ships and trucks, which make up the backbone of global supply chains. 

Per Bonner’s analysis, U.S. government policies designed to end reliance on fossil fuels and fully transition to renewable energy sources will backfire significantly. Bonner claims that renewable energy sources like wind power and solar power are not yet advanced enough to play a significant role in the energy grid, making the ongoing transition to renewable energy sources premature.

The second key part of Bill Bonner’s 4th prediction is inflation and budget deficits. Bonner predicts that “America is about to experience one of the greatest inflationary periods in world history”. Bonner says the dollar could enter a hyperinflationary cycle, and says the U.S. government’s spending and economic policies could devastate the currency similar to what happened in Argentina.

A section from Bonner’s 4th prediction reads:

“Before this cycle is over, oil will go to $500 a barrel. That’s in part because of more inflation and more money printing (the dollar could fall by another 50% from here), and in part because the government has essentially ended new oil and natural gas exploration. In the short term, we’re going to see rolling electricity blackouts and shortages.”

According to Bonner, the best way investors can position themselves ahead of this predicted crisis is to own assets related to U.S. natural resource energy, most importantly U.S. natural gas. 

So far, Bonner’s prediction of an uncontrollable rise in diesel fuel price hasn’t played out. While it is true that the price of diesel fuel spike massively after Russia invaded Ukraine in February 2022, the price of diesel fuel has retreated back to its September 2021 levels. To be fair, however, it’s still substantially higher than it was in 2020. 

Diesel fuel price chart. Image source: Markets Insider

The bottom line – How much weight should we give to Bill Bonner’s prediction?

Overall, Bill Bonner is forecasting an almost worst-case scenario for the U.S. economy from a fiscal conservative perspective. For those who adhere to this political and economic philosophy or at least think it has valuable ideas, Bonner’s predictions could be worth taking a look at.

While Bonner’s analysis has some merit, we have to point out that it appears he is trying to instill a sense of urgency in his readers, which would lead them to act as fast as possible. Some parts of Bonner’s warning appear to be concerned more with scaring readers into paying for premium content and subscriptions rather than providing a realistic scenario of how an economic and energy crisis trigged by the U.S. government and Federal Reserve’s current policies would play out.  

Notably, Bonner doesn’t provide a concrete timeline for his prediction, which could make the prediction easier to defend in case it doesn’t play out as expected in the coming months and years.

Bonner provides a four-step plan that supposedly outlines how investors should prepare themselves for the forecasted crisis, but all four parts of the plan are behind a paywall. 

If you’re looking for other investment ideas, check out our list of the best stocks with a long-term history of paying dividends.