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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 didn’t close immediately has been in “wait and see” mode, clinging on to the hope that once the pandemic ends then everything will roar back to life, bigger and better than before.

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 easy to catch, why not grab as much as we can?” scooping is frontrunning inflation, the universally expected result of the Great Reflation Trade.

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:

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 of billionaires’ fortunes will magically create jobs for all those living in the real world he’s created of stagnation, social depression and inequality?

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 is waste: capital, labor and resources that are squandered and then mislabeled “growth” for PR purposes.

Perhaps we need an honest national dialog about declining expectations, rising inequality, social depression and the failure of the status quo. Even as the chirpy happy-talk of a return to normal floods the airwaves, what nobody dares acknowledge is that “normal” for a rising number of Americans is the social depression of downward mobility and social defeat.

Is that really what you want to spend your time doing, paying higher taxes? “No matter how much money I make, they will always print more. I can’t print anymore time.”

Kill authentic price discovery, you also kill markets, and in killing markets, you kill allocation of capital and risk management, and in killing those, you kill the economy. Back when prosperity was authentic, the Federal Reserve had little need for public relations.

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.

Needless to say, few are expecting bubble symmetry to manifest now, because, well, of course, “this time it’s different.” Indeed. It’s always different and yet always the same, too.

So babble on, Babble-On 7; it won’t change anything. The forces in motion are like tides, and you can’t talk the tide into reversing. Allow me to introduce the Babble-On 7: the six board members of the Federal Reserve and Treasury chief Janet Yellen. (The Fed board has seven slots but one is vacant at the moment, so 6 + Yellen = 7.)

This madness is now global, so next up: global depression. A few days after the Covid pandemic was officially announced last year on 1/23/20, I prepared a chart projecting the course of the pandemic. In my view it still stands, with two updates: “vaccines months away” has been updated to “mass vaccinations months away” and “Wave 2” has been updated to “Wave 4.” (see chart below)

America’s financial system is nothing more than a toxic waste dump of speculation, fraud, collusion, corruption and rampant profiteering. What Poisoned America? The list of suspects is long: systemic bias, special interests dominating politics, political polarization, globalization and the offshoring of productive capacity, over-regulation, the rise of rapacious cartels and monopolies, Big Tech’s gulag of the mind, the permanent adolescence of consumerism, permanent global war, to name a few.

The lifestyle you ordered in the euphoria will be out of stock in the panic. Humans running Wetware 1.0 (which is all of us) love to gamble, and we are entranced by the thrill of victory and the agony of defeat. When there’s a market for speculation, these wild swings of emotion manifest as euphoria (I’m winning!) and fear (I’m losing).