Keynesian policy of manipulating economic “aggregates” through countercyclical macro-measures appeared to work when balance sheets was not stretched to the brink. As we wrote in “Goebbelnomics”
“If collective exuberance and apathy is the sole cause of the business cycle, then it logically follows that human emotions need to be manipulated accordingly. Only by doing so can policymakers smooth out the ups and downs in economic activity. And what better way to do that then to change the money supplied to the general public.”
While people called this the “most sickening article ever written” it is unfortunately what economics has come down to. Through fractional reserve banking and a central bank freed from the shackles of a barbarous relic, the money supply can be expanded without limit…or at least as long as the greater populace voluntarily will leverage up their balance sheet to buy stuff and simultaneously agree to their own servitude. Nothing more than collective manipulation on a scale that would make Goebbels himself envious.
The glaringly obvious result of such policies, gross capital consumption through malinvestments epitomized through a serial bubble economy, did not discourage our money masters. The best and brightest even suggest bubbles are the only remedy to what they believe is some sort of secular stagnation.
Just as drugs, the abuser must increase the dosage to feel the same high and spend accordingly.
However, as the first chart shows, the current recovery, albeit one of the longest on record, has also been the weakest.
…click on the above link to read the rest of the article…
