The Worst Threat We Face Is Right Here at Home
The comments above & below is an edited and abridged synopsis of an article by Chris Martenson
Earlier in February, volatility made a long-overdue return to the US and global equity markets, but after violent drops and rebounds, they have been steadily rising.
Is the danger past, and are the markets safe again? If so, did the markets recover organically? Or were they rescued by The Plunge Protection Team?
If such intervention was rare, and if it took the form of simple, prearranged circuit breakers that shut down the market for a cooling off period, it could almost be justified.
But if such market interventions are routine, persistent, and generally depended on by the major market participants, then they’re highly destructive over the long term. Sadly, we live with the latter.
Insiders get rich by front-running the scheme. Normal adjustments are prevented, allowing dangerous bubbles of extreme overvaluation to form, while fostering malinvestment.
Do this long enough and you end up with a deformed economy, an eroded social structure, and markets that no longer function as appropriate mechanisms for capital distribution and economic signaling. As bad as the damage done so far has been, the real pain has not yet begun.
The entire command-and-control system of the US and other western economies and markets has resulted in several decades of increasingly poor decision making and mal-investment.
Current global debt levels of -310 % of GDP can never be repaid. It can only be rolled over, which can’t go on much longer without real consequence. Mounting losses are certain at this point.
When it comes to underfunded promises and entitlement programs, such as pensions and social security (clocking in at nearly 800% of GDP), there us really only one question that matters: Who will eat the losses?