Of Two Minds

Addiction is deadly, and no amount of artifice can obscure that this monetary addiction and collapse is the result of one Pusher: the Federal Reserve. To talk about the Federal Reserve raising rates and reducing “easing” as a policy error is like saying the fentanyl addict who reduces his daily dose is making a policy error.

Ponder what a clawback of the $50 trillion might entail, and the immense benefits of returning to producing quality goods and services by completely unwinding financialization and globalization. The happy story that’s been ceaselessly promoted for 45 years is that financialization and globalization have been wunnerful for all of us, boosting wealth and saving a small fortune as the cost of products fell.

The crapification of the U.S. economy is now complete. The only thing left is the tiresome waiting for the implosion of the entire travesty of a mockery of a sham. The U.S. economy has fundamentally changed, and not for the better. There are numerous dynamics behind this decay, and I’ll discuss a few of the more consequential ones this month.

When the state / empire loses the ability to recognize and solve core problems of security and fairness, it will be replaced by another arrangement that is more adaptable and adept at solving problems. From a systems perspective, nation-states and empires arise when they are superior solutions to security compared to whatever arrangement they replace: feudalism, warlords, tribal confederations, etc.

The bear has awakened, and it will not be limited to the stock market. The bear awakens from a long, uneasy slumber and the everything bubble is in trouble. I’m not going to make the bear case with charts or price-earnings ratios or sentiment readings or anything remotely financial.

We are in effect so busy arranging the beach umbrellas per our instructions that we don’t notice the approaching tsunami. Economists focus on what can be easily measured: sales, profits, prices, tax revenues, etc. Since the decay and failure of institutions isn’t easily quantified, this decay doesn’t register in the realm of economics.