For the record, I didn’t think central planners would be able to put Humpty Dumpty back together again ten years ago for as long as they did. I was simply wrong about that, but that’s how big changes in world history typically go.
They tend to take a lot longer to reach the final tipping point than you think despite abundant evidence and signs point to something dramatic happening imminently. I often think back to 1830s America. If you were alive during that decade you’d have expected civil war to break out any moment, yet it took another three decades.
So while the prevailing establishment was able to keep a dead system on life support for an extra ten years to enrich themselves with some more corruption, it was not without consequence. People have not forgotten the unconscionable manner in which Wall Street’s professional white collar criminals were rescued and reward by the Federal Reserve and politicians in D.C.
Just a few months before the 2016 election CNBC published a piece titled, The U.S. Is Still Angry at Wall Street, and It May Be Hurting Recruiting, in which we learned:
Americans still hold big banks in low regard, years removed from the financial crisis. A SurveyMonkey poll of more than 10,000 U.S. adults calls Wall Street ruthless, and when people were asked which of the biggest U.S. companies named in the Fortune 100 were worst for the country, three of the top five names that came to mind were banks.Survey respondents assigned “most ruthless” status to four banks — Goldman Sachs, JPMorgan Chase, Bank of America and Morgan Stanley. Goldman did not respond to a request for comment, the others declined comment.
I believe such an attitude played a material role in Trump’s win given Clinton’s well known intimate financial and personal relationships with mega-banks and other financial industry scoundrels. Which brings me to the main point about where we are, and where we’re headed.
When Obama was elected in 2008, the country’s overall political environment was largely the same old rancid neocon/neoliberal consensus. You either voted for a Bush or a Clinton, or someone similar enough.
This has changed, and a big reason is due to how Wall Street was bailed out, while main street was left holding the bag.
To summarize, I think the country will become even more populist in the years ahead (both left and right populism), and policy coming out Congress will ultimately reflect this reality on the ground. If it doesn’t, then we may see Yellow Vests style protests emerge here before too long.
Either way, business as usual is ending and I think we’ve already seen peak corporatism in American culture. The backlash has started and will accelerate from here.
It’s important to understand that while financial market volatility was squashed and hidden for so many years, building tensions on the ground always find some sort of escape, and that escape largely manifested in the political arena. Actions have consequences, you just never know exactly where and how they’ll make their presence felt.
Therefore, the backdrop and mood of the American public is nothing like it was back in 2008/09. People were upset back then about the Wall Street giveaway, but the public generally had more confidence in institutions, government and the status quo than it does now. If you’ve only been watching stock market ticks for the last ten years, you’ve missed the really big story. We’ve got a major generational cycle only now coming into full swing, coupled with a far more populist mood on the ground. Pull a stunt like you did in 2008, and the U.S. could very quickly look a lot like France.
I think we’re close to the inflection point, but the whole thing will take time to fully play out.
By 2025, the entire world will look completely different, and I think we’ll have a totally new global financial system, or possibly even a couple of competing financial systems (U.S. sphere and China sphere).
Peter Schiff: This Is The Beginning Of A Much Bigger Crisis
Via SchiffGold.com,
Wall Street has been on a roller coaster ride over the last few months. If you listen to the pundits on the financial networks, you’ll hear the word “volatile” used over and over again. That word certainly seems to describe the current state of US stock markets and in a broader sense the economy.
But during a recent interview on RT News with Rick Sanchez, Peter Schiff said it’s not that the economy is volatile. It’s actually a bubble. And we are on the verge of a bigger crisis than the one we went through in 2008.
It’s not a volatile economy, it’s a bubble economy. Thanks to the Federal Reserve, they inflated an even bigger bubble, on purpose, than the one they inflated by accident that popped in 2008. And so the economy is in much worse shape structurally today then it was before it fell apart the last time. So, this is the beginning of a much greater crisis, of a much greater recession than the one that we experienced back in 2008.”
Sanchez asked Peter what exactly the Federal Reserve did wrong. Peter said, basically, everything.
As Sanchez put it, the fear is that if the Fed continues to raise rates, it will pop the bubbles and the economy will come crashing down. But Peter said that’s not what’s going to happen. In fact, the Fed isn’t going to keep raising rates. Ultimately, the central bank will push rates back to zero and launch another round of QE when it becomes clear that the economy has entered into a recession.
That is going to take a very bad situation and make it much worse because it’s not going to work like it did last time in that it blew up a bigger bubble. This is going to blow up in everybody’s face. It’s not going to cause real estate prices to go up or stock prices. It’s going to cause food prices to go up, gasoline prices. It’s the cost of living that’s going to rise, not the stock market. And so this is going to be an inflationary recession.”
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