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Is Anyone Willing to Call the Top of the Everything Bubble?
Is Anyone Willing to Call the Top of the Everything Bubble? Can extremes become too extreme to continue higher? We’re about to find out. Is anyone willing to call the top of the Everything bubble? The short answer is no. Anyone earning money managing other people’s money cannot afford to be wrong, and so everyone in […]
The Illusion of Stability, the Inevitability of Collapse
The Illusion of Stability, the Inevitability of Collapse Beneath the illusory stability of rising GDP, the extremes of debt, leverage, stimulus and speculative frenzy required to keep the ‘phantom wealth bubble’ from imploding are all rising parabolically. Imagine being at a party celebrating the vast wealth generated in the last ten months in stocks, cryptocurrencies, […]
Fed Up with the Fed’s Abuse of Power
Fed Up with the Fed’s Abuse of Power One phrase describes the Fed’s pillaging of the nation to benefit the few at the expense of the many: abuse of power. To confess that the fate of the entire global economy now rests on the mumblings of a fossilized Politburo fanatically devoted to making the rich […]
How Breakdown Cascades Into Collapse
How Breakdown Cascades Into Collapse Maintaining the illusion of confidence, permanence and stability serves the interests of those benefiting from the bubbles and those who prefer the safety of the herd, even as the herd thunders toward the precipice. The misconception that collapse is an all or nothing phenomenon is common: Either the system rights itself with a […]
Welcome to the 21st Century Sequel of the Catastrophic 1600s
Welcome to the 21st Century Sequel of the Catastrophic 1600s As the chart below on ‘how systems collapse’ illustrates, the loss of stabilizing buffers goes unnoticed until the entire structure collapses under its own weight. Disruptive extremes of weather: check Rising geopolitical tensions with no diplomatic resolution: check Multiplying scarcities in essential commodities: check Domestic disorder accelerates as […]
When Expedient “Saves” Become Permanent, Ruin Is Assured
When Expedient “Saves” Become Permanent, Ruin Is Assured The Fed’s “choice” is as illusory as the “wealth” the Fed has created with its perfection of moral hazard. The belief that the Federal Reserve possesses god-like powers and wisdom would be comical if it wasn’t so deeply tragic, for the Fed doesn’t even have a plan, […]
USA 2021: Capitalism for the Powerless, Crony-Socialism for the Powerful
USA 2021: Capitalism for the Powerless, Crony-Socialism for the Powerful The only dynamic that’s even faintly “capitalist” about America’s Crony-Socialism is the price of political corruption is still a “market.” The supposed “choice” between “capitalism” and “socialism” is a useful fabrication masking the worst of all possible worlds we inhabit: Capitalism for the powerless and Crony-Socialism for […]
Systemic Risks Abound
Systemic Risks Abound If you wanted to design a system guaranteed to collapse in a putrid heap, you’d make moral hazard ubiquitous and you’d make the system 100% dependent on a hubris-soaked faux savior. For the past 22 years, every time the stock market whimpered, wheezed or whined, the Federal Reserve rushed to soothe the […]
Here’s How ‘Everything Bubbles’ Pop
Here’s How ‘Everything Bubbles’ Pop But weirdly, and irrationally, bubbles pop anyway. At long last, the moment you’ve been hoping for has arrived: you’re pitching your screenplay to a producer. Your agent is cautious but you’re confident nobody else has concocted a story as outlandish as yours. Your agent gives you the nod and you’re off […]
If You Don’t See Any Risk, Ask Who Will “Buy the Dip” in a Freefall?
If You Don’t See Any Risk, Ask Who Will “Buy the Dip” in a Freefall? Nobody thinks a euphoric rally could ever go bidless, but as Greenspan belatedly admitted, liquidity is not guaranteed. The current market melt-up is taken as nearly risk-free because the Fed has our back, i.e. the Federal Reserve will intervene long […]
The Hazardous Detour in the Road to “Recovery” Few Foresee
The Hazardous Detour in the Road to “Recovery” Few Foresee As the level of Fed smack and crack needed to maintain the high increases, system fragility increases geometrically. You know the plot point in the horror film where the highway is blocked and a detour sign directs the car full of naive teens off onto a rutted track into […]
Do We Really Think a Band-Aid Will Heal a Tumor?
Do We Really Think a Band-Aid Will Heal a Tumor? Borrowing a quarter of the nation’s entire economic output every year to prop up an ineffective, corrupt status quo is putting a Band-Aid over a tumor. If we misdiagnose the disease, our treatment won’t work. We’re all familiar with medical misdiagnoses, which lead to procedures and […]
Too Busy Frontrunning Inflation, Nobody Sees the Deflationary Tsunami
Too Busy Frontrunning Inflation, Nobody Sees the Deflationary Tsunami Those looking up from their “free fish!” frolicking will see the tsunami too late to save themselves. It’s an amazing sight to see the water recede from the bay, and watch the crowd frolic in the shallows, scooping up the flopping fish. In this case, the crowd […]
The Global Financial End-Game
The Global Financial End-Game The over-indebted, overcapacity global economy an only generate speculative asset bubbles that will implode, destroying the latest round of phantom collateral. For those seeking a summary, here is the global financial endgame in fourteen points: 1. In the initial “boost phase” of credit expansion, credit-based capital ( i.e. debt-money) pours into […]
Oil and Debt: Why Our Financial System Is Unsustainable
Oil and Debt: Why Our Financial System Is Unsustainable How much energy, water and food will the “money” created out of thin air in the future buy? Finance is often cloaked in arcane terminology and math, but the one dynamic that governs the future is actually very simple. Here it is: all debt is borrowed against […]
