The Mother Of All Crashes Coming?

The Mother of All Crashes Is Coming in April 2023

Brandon Smith

The signs of the coming economic contraction are already both present and obvious, but the overall economic picture probably won’t be acknowledged in the mainstream until the situation becomes much worse

It’s a problem that arises at the onset of every historic financial crisis – mainstream economists and cable-news commentators deliberately mislead the public about the severity of the challenges and the chances of recovery. They feed their audiences false reassurances in the hope of lulling people back to sleep.

Even now with inflation pummeling the average American family, they tell us that there is nothing to worry about. The Federal Reserve’s “soft landing” is on the way.

I remember in 2007, right before the epic derivatives collapse that took down Lehman Brothers and Bear Sterns, when media pundits were applauding the U.S. housing market and forecasting even greater highs in both sales and in valuations. A “permanent plateau,” which would generously spread wealth across the nation.

I had only been writing economic analysis for about a year at the time, but I remember thinking that all this overt optimism felt like compensation for something. It seemed as if they were trying to pull the wool over the eyes of the public in the hopes that, if people just believed hard enough that all was well, then the fantasy could be manifested into reality. Science has even developed a term for this: the Tinkerbell effect.

So far, higher interest rates are not bringing prices down significantly, nor are they slowing manic stock market speculation. Easy money has been entrenched for far too long, which means a “hard landing” (which is what Fed officials call a collapse) is the most likely scenario.

I think that, this time, the Fed wants a crash.

As I noted in my article The Fed Is Taking The Punch Bowl Away – But The Inflation Crisis Will Continue To Grow, published in May:

The central bank has a global agenda that requires the decline of the American economy. They are getting exactly what they want and they are perfectly aware of what they are doing.

One lesser-known issue is the new 1% excise tax on stock buybacks planted within Biden’s Inflation Reduction Act. The measure, which goes into effect in January of next year, will not reduce prices on most goods. That said, stock buybacks are still the main way major corporations keep their stock prices high. Over the past decade, buybacks were funded by money borrowed from banks or from the Fed directly at near-zero interest. Adjusted for inflation, these loans were essentially free money.

Now, the easy money party is about to end.

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