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‘Spaced Out’: Don’t Bring A Knife To A Gunfight.
How many times have we said it?
At this point, the future of risk assets depends almost entirely on whether policymakers can replenish their countercyclical ammo in time to combat the bust the will almost invariably follow from the boom those same policymakers engineered by deploying that very same ammo.
Note the circularity there. That's the "double-edged sword" dynamic that's part and parcel of an untethered regime.
An unanchored system (i.e. a system that is not based on a universally acce
> “Don’t bring a knife to a gunfight. And don’t bring ZIRP and a still-bloated balance sheet to a recession”
Yeahbut I’m afraid policymakers will implement even more unorthodox shit to drag us even further down the rabbit hole. There have already been trial balloons floated. Here’s some great socialist ideas:
1) NIRP
2) Cashless society (to facilitate NIRP)
3) Forcing savings pools and pensions into “safe” government assets (to also support NIRP)
4) Forced rollovers for bond holders
5) Government debt write-down and debt jubilee
6) The trillion dollar treasury coin schemes (to support 5)
7) Bail-ins, bank holidays, mortgage holidays, market holidays
8) Capital controls (to support all the above)
9) And more butt…..
#2 is key
Indeed. And the transition to cashless facilitates both more NIRP and tax collection, so it’s red meat for govt sharks – plus my generation pays for everything with mobile so they’ll quickly surrender to cashless, clueless about what’s really happenin.
NIRP in a cashless society will lead to a govt confrontation with crypto/BTC, which will face severe control or abolition. I “get” that’s inevitable one way or another. You and I just see the final outcome differently (the ppl win and the fascists lose). So colour me the optimist even tho I’m widely seen here as an ornery bitch.
Consumer debt has exponentially over the past 75 years while income has growth has remained linear. What tools do they have? People are more interest rate sensitive than ever, and with inflation always growing the only way to close the gap is more leverage.
It’s hopeless, only way to fix this is wipe all debt clean or keep it low, encourage saving, and experience booms and busts. The tax plan is only going to exacerbate this if passed, as millennials are going to have a hard enough time accumulating wealth with their current debt loan… but eliminating the mortgage interest deduction only pushes them farther away from obtaining the one asset that will truly advanatge them in accruing positive net worth.
I expect some form of revolution given the current state of affairs, the status quo is not sufficient.
Agreed… I’ll add that it appears the revolutionary “form” we’re most likely to get is going to be the “Civil War” variety. Yippee.
The entire playbook is outlined in G. Edward Griffin’s ‘The Creature from Jekyll Island.
Or William Durant’s ‘The Lessons of History’.