So one index or asset or another strikes a brand-new high, wow, more proof everything is so robust and healthy, we never had it so good– right approximately the seizure and collapse.
Some readers occasionally make the point that I have actually been anticipating a market crash for 10 years and been dead-wrong for 10 years. I recommend mocking presumptuous experts of either the tin-foil hat or mainstream range, however that’s not rather what I’ve been saying for 13 long, tedious years.
What I have actually been stating is that residing on unhealthy food and sugar-cocaine speedballs isn’t “health” even if a handful of pills has actually dropped cholesterol readings to “healthy” levels. If we define “health” by a metric that is quickly manipulated, then the illusion of “health” can be maintained right up until the allegedly “healthy” individual has a seizure and drops dead.
Since the 2008-2009 financial-coronary and emergency-intervention that revealed the abjectly poor health of the global financial system, reserve banks and states have boosted stocks and other properties as the metric of a “healthy” economy. Simply as banging down cholesterol does not actually make a chronically ill individual subsisting on unhealthy food, sugar and cocaine healthy, jacking stocks to new highs doesn’t make the economy or monetary system healthy. All it does is mask the decay of real health and magnify the ultimate reckoning.
There are three dynamics at work in the artifice that ever-greater financial and financial stimulus and jacked-up stock exchange will restore the health of a decaying, sickly economy. One is that sugar-cocaine speedballs produce miraculous results in the beginning: the manic rush of energy and the delusional confidence in god-like powers appears like robust health if viewed through a distorted lens that removes all the hidden compromises and costs to depending on speedballs to function.
The second is the dependency to stimulus and controlled metrics of “health” is unfailingly fatal. If the economy/ market continue depending on sugar-cocaine speedballs to keep racing higher, the second-order consequences and distortions ultimately activate a seizure and collapse. (Please read What Will Surprise Us in 2022 for a description of how dependency to stimulus activates second-order consequences).
But going cold-turkey and stopping the speedball stimulus and manipulation of metrics will likewise activate seizure and collapse. This is the drawback of depending on feel-good stimulus and faking metrics of “health”: when the artificial stimulus becomes the lifeblood, withdrawing it leads to collapse. Once ginned-up metrics are worshiped as “evidence” of health, when the adjustment finally fails then all the self-confidence and rely on the metrics and those doing the adjustment is lost.
The third dynamic is the greater the initial buffers of wealth readily available, the longer the fake “health” can be propped up. Consider Japan’s 3 years of stagnation and mostly hidden decay. Japan continues to hold large overseas wealth and cultural cohesion, and these sources of wealth allow Japan’s state and central bank to conjure trillions of yen out of thin air and trade the yen for gas to preserve the impression of “health.”
Less rich countries without central bank-issued “cash” can just sustain the sugar-speedball impression of “health” for a couple of years prior to reality intrudes and the artifice collapses.
The United States has burned virtually all of its social cohesion and trust in organizations in the past 13 years of sugar-cocaine speedball stimulus and artifice. All the sugar-cocaine speedball stimulus did was improve the already-rich and impoverish everybody else, to the point that the top couple of gather 97% of all income generated by capital and own more wealth than the bottom 80%.
This severe distortion and inequality is tearing apart the economy, society and political order– all to keep ‘the key metric of “health”– the stock exchange– skyrocketing to brand-new highs.
It’s frustrating viewing the doped-up wreck living on Cheetos, sugar and drug proclaiming just how much energy he has and how his portfolio is soaring, as all of us understand his death is inevitable. Just as the body keeps trying to make up for the devastations of unhealthy food, sugar and cocaine and re-establish homeostasis, the real-world economy staggers on as the people left behind by the sugar-cocaine wealth increase keep doing the real work of keeping the whole rotten edifice functioning.
But the efforts of all those keeping the real-world economy glued together can’t delay the repercussions of our total dependence on sugar-cocaine speedballs and the artifice of possession bubbles being “proof” of “health. The junkie living on speedballs keeps going right up till the moment they have a seizure and collapse. Right up until this unexpected demise, the junkie insists they’re healthy due to the fact that “look at my low cholesterol reading.”
The decay is hidden and progressive, but the collapse is abrupt and irreversible.
So one index or property or another hits a new high, wow, more proof whatever is so robust and healthy, we never ever had it so great– right as much as the seizure and collapse.
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