The “Helicopter Parent” Fed and the Fatal Crash of Risk

All the risks generated by gambling with trillions of borrowed and leveraged dollars didn’t actually vanish; they were transferred by the Fed to the entire system. The Federal Reserve is the nation’s Helicopter Parent, saving everyone from the consequences of their actions. We all know what happens when over-protective Helicopter […]

Is a Cultural Revolution Brewing in America?

The lesson of China’s Cultural Revolution in my view is that once the lid blows off, everything that was linear (predictable) goes non-linear (unpredictable). There is a whiff of unease in the air as beneath the cheery veneer of free money for almost everyone, inequality and polarization are rapidly consuming […]

What Could Go Awry?

All of which sounds very pretty indeed, but it does raise a question: can risk really be destroyed, or can it only be transferred? And if it can only be transferred, then what’s it been transferred to? What a remarkable moment in time: every asset is lofting higher, with no […]

What’s Changed and What Hasn’t in a Tumultuous Year

Inequality is America’s Monster Id, and we’re continuing to fuel its future rampage daily. What’s changed and what hasn’t in the past year? What hasn’t changed is easy: 1. Wealth / income inequality is still increasing. (see chart #1 below) 2. Wages / labor’s share of the economy is still […]

The UFO/Fed Connection

Perhaps the aliens’ keen interest in Earth’s central bank magic and its potential for destruction results from a wager. You’ve probably noticed the recent uptick in UFO sightings and video recordings from aircraft of the extraordinary flight paths of these unidentified objects. Perhaps it’s not coincidence that UFO sightings are […]

Our “Wealth”: Cloud Castles in the Sky

Buyers know there will always be a greater fool willing to pay more for an over-valued asset because the Fed has promised us it will always be the greater fool. I realize nobody wants to hear that most of their “wealth” is nothing more than wispy Cloud Castles in the […]

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 the […]

Health, Wealth and What Kills Most of Us

If health is wealth, and it most certainly is the highest form of wealth, then we would be well-served to take charge of our health-wealth in terms of what behaviors we can sustainably modify. Longtime correspondent J.F. (MD) recently shared a fascinating graphic ranking the leading causes of death in […]

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 prescriptions that can’t possibly fix […]

Welcome to the Winter of Our Discontent

If you think this scale of stimulus is sustainable and consequence-free, you must be mainlining Delusionol. Wall Street’s euphoria knows no bounds, so how can this be the Winter of Our Discontent?We all know the source of Wall Street’s euphoria: $1.9 trillion in stimulus, followed by another $3 trillion for […]

We Don’t Need The Great Reset, We Need The Great Rebalancing

Perhaps we have collectively “lost our mind.” Perhaps what we need is not a new technology but a new way of living that uses existing technologies to echo “old ways” that worked rather well on much lower energy consumption. The Great Reset is much in the news–the proposed top-down plan […]

How We Stumbled to the Edge of the Cliff

Oops. Looks like the Fed’s magic (and our luck) have finally run out. Now that we’re teetering on the edge of the cliff, it might be a good idea to retrace how we stumbled down to this crumbling, precarious ledge. As I’ve discussed for the past 15 years, there are […]

Our Dead Money Economy

The U.S. stock and bond markets and its entire financial system now teeter on the edge of collapse if there is even a slight hint that 1) the Fed won’t give more free candy to Wall Street or 2) the Fed has lost control of the Dead Money Economy it […]

Stimulus Addiction Disorder: The Debt-Disposable Earnings Pyramid

One glance at this chart explains why the status quo is locked on “run to fail” and will implode in a spectacular collapse of the unsustainable debt super-nova.. For those who suspect the status quo is unsustainable but aren’t quite sure why, I’ve prepared a simple chart that explains the […]

The Cannibalization Is Complete: Only Inedible Zombies Remain

Poor powerless Fed, poor starving cannibals, poor zombies turning to dust. That’s the American economy once the curtains are ripped away. Setting aside the fictional flood of zombie movies for a moment, we find the real-world horror is the cannibalization of our economy, a cannibalization that is now complete. Every […]

The “Wait and See” Economy’s Moment of Truth

The “wait and see” economy is about to face its moment of truth, and one truth is the $1.8 trillion being passed out like candy is already spent. The defining phrase of the U.S. economy for the past year is “wait and see”: every enterprise impacted by the pandemic that […]

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 doing the “so […]

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 […]

When Does This Travesty of a Mockery of a Sham Finally Implode?

The mutually reinforcing crises aren’t in the future, they’re here now, and Jay Powell’s shuck-and-jive has lost its magical powers to cloak the rot with speculative bubbles. How many more times do we have to watch Jay Powell claim his speculative bubble isn’t a bubble, and that his massive expansion […]

About That +6.8% GDP Forecast: Remember That GDP = Waste

Any economy stupid enough to rely on the insane distortions of GDP “growth” as its primary measure will richly deserve a Darwin Award when it inevitably collapses in a putrid heap of squandered resources and capital. We’re told the gross domestic product (GDP) measures growth, but what it really measures […]