That the era of stability has ended and a new era of increasingly chaotic volatility has begun is not on anyone’s radar as a possibility. The standard debate about the future of the economy is: which will we get, high inflation or a deflationary collapse of defaults and asset bubbles popping?

Change the incentives, and the outcomes change. Ecologist Howard Odum provided a profound insight into human expansion, stagnation and collapse. He argued that humans are wired to maximize power output (i.e., consumption) rather than maximize efficiency.

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 spoiled crybaby.