Category Archive: 5.) Charles Hugh Smith

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What’s Taboo? Everything Except Greed

2021-04-16

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2021-04-16

OK, now I get it. Take a couple tabs of Euphorestra and Hopium, and stick to talking about making money in the market. Greed won't offend anyone. So I started to tell my buddy about my new screenplay idea: "There's a global pandemic, and when they rush a bunch of vaccines to market, then...."

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The Middle Class Has Finally Been Suckered into the Casino

2021-04-15

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2021-04-15

The Fed's casino isn't just rigged; it's criminally unstable. The decay of America's middle class has been well documented and many commentators have explored the causal factors. The bottom line is that this decay isn't random; the income of the middle class isn't going to suddenly increase at 15 times the growth rate of the income of the top 0.1%. (see chart below) The income of the top 0.1% grew 15 times faster than the incomes of the bottom 90%...

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The “Helicopter Parent” Fed and the Fatal Crash of Risk

2021-04-14

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2021-04-14

Margin Accounts at Brokers and Dealers, 1960-2020
All the risks generated by gambling with trillions of borrowed and leveraged dollars didn't actually vanish; they were transferred by the Fed to the entire system. The Federal Reserve is the nation's Helicopter Parent, saving everyone from the consequences of their actions.

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Is a Cultural Revolution Brewing in America?

2021-04-13

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2021-04-13

The lesson of China's Cultural Revolution in my view is that once the lid blows off, everything that was linear (predictable) goes non-linear (unpredictable). There is a whiff of unease in the air as beneath the cheery veneer of free money for almost everyone, inequality and polarization are rapidly consuming what's left of common ground in America.

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What’s Changed and What Hasn’t in a Tumultuous Year

2021-04-05

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2021-04-05

Inequality is America's Monster Id, and we're continuing to fuel its future rampage daily. What's changed and what hasn't in the past year? What hasn't changed is easy: 1. Wealth / income inequality is still increasing. (see chart #1 below) 2. Wages / labor's share of the economy is still plummeting as financial speculation's share has soared. (see chart #2 below)

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Our “Wealth”: Cloud Castles in the Sky

2021-04-04

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2021-04-04

Buyers know there will always be a greater fool willing to pay more for an over-valued asset because the Fed has promised us it will always be the greater fool. I realize nobody wants to hear that most of their "wealth" is nothing more than wispy Cloud Castles in the Sky that will dissipate in the faintest zephyr, but there it is: that which was conjured out of thin air will return to thin air.

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The UFO/Fed Connection

2021-04-02

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2021-04-02

M2 Money Stock, 1960-2020
Perhaps the aliens' keen interest in Earth's central bank magic and its potential for destruction results from a wager. You've probably noticed the recent uptick in UFO sightings and video recordings from aircraft of the extraordinary flight paths of these unidentified objects.

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Health, Wealth and What Kills Most of Us

2021-03-29

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2021-03-29

If health is wealth, and it most certainly is the highest form of wealth, then we would be well-served to take charge of our health-wealth in terms of what behaviors we can sustainably modify.

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Stimulus Addiction Disorder: The Debt-Disposable Earnings Pyramid

2021-03-16

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2021-03-16

The Debt - Disposable Earnings Pyramid
One glance at this chart explains why the status quo is locked on "run to fail" and will implode in a spectacular collapse of the unsustainable debt super-nova.. For those who suspect the status quo is unsustainable but aren't quite sure why, I've prepared a simple chart that explains the financial precariousness many sense.

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The Cannibalization Is Complete: Only Inedible Zombies Remain

2021-03-13

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2021-03-13

Poor powerless Fed, poor starving cannibals, poor zombies turning to dust. That's the American economy once the curtains are ripped away. Setting aside the fictional flood of zombie movies for a moment, we find the real-world horror is the cannibalization of our economy, a cannibalization that is now complete.

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Too Busy Frontrunning Inflation, Nobody Sees the Deflationary Tsunami

2021-03-08

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2021-03-08

Those looking up from their "free fish!" frolicking will see the tsunami too late to save themselves. It's an amazing sight to see the water recede from the bay, and watch the crowd frolic in the shallows, scooping up the flopping fish. In this case, the crowd doing the "so easy to catch, why not grab as much as we can?" scooping is frontrunning inflation, the universally expected result of the Great Reflation Trade.

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About That +6.8 percent GDP Forecast: Remember That GDP = Waste

2021-03-02

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2021-03-02

Any economy stupid enough to rely on the insane distortions of GDP "growth" as its primary measure will richly deserve a Darwin Award when it inevitably collapses in a putrid heap of squandered resources and capital.

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What “Normal” Are We Returning To? The Depression Nobody Dares Acknowledge

2021-03-01

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2021-03-01

Perhaps we need an honest national dialog about declining expectations, rising inequality, social depression and the failure of the status quo. Even as the chirpy happy-talk of a return to normal floods the airwaves, what nobody dares acknowledge is that "normal" for a rising number of Americans is the social depression of downward mobility and social defeat.

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Oil and Debt: Why Our Financial System Is Unsustainable

2021-02-25

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2021-02-25

Primary energy consumption by source, 1965-2018
How much energy, water and food will the "money" created out of thin air in the future buy? Finance is often cloaked in arcane terminology and math, but the one dynamic that governs the future is actually very simple.

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What Poisoned America?

2021-02-20

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2021-02-20

America's financial system is nothing more than a toxic waste dump of speculation, fraud, collusion, corruption and rampant profiteering. What Poisoned America?

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Gains Are Unreal, Losses Are Real

2021-02-12

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2021-02-12

Why would anyone sell when further gains are guaranteed? Because the gains are unreal but the losses are real. When markets are soaring and your portfolio is rocketing higher, the gains seem unreal.

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What Collapsed the Middle Class?

2021-02-11

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2021-02-11

The middle class has already collapsed, but thanks to debt and bubbles, this reality has been temporarily cloaked. What collapsed the middle class? In many ways the answer echoes an Agatha Christie mystery: rather than there being one guilty party, a number of suspects participated in the collapse of the middle class.

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The Top 10percent Is Doing Just Fine, The Middle Class Is Dying on the Vine

2021-02-06

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2021-02-06

Please study these charts as a means of understanding the inevitability of economic stagnation and a revolt of the decapitalized middle class.

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Our Fragile, Brittle Stock Market

2021-02-03

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2021-02-03

This heavily managed 'market structure' is far from equilibrium and extremely prone to instability.

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Silver Swans, Maginot Lines and the Unforeseen Risks of Collapse

2021-02-01

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2021-02-01

Our Nobility's assessment of risk and their war-gaming of vulnerabilities are fatally deficient. Many people have heard of Nassim Taleb's black swan but fewer understand how few events qualify as black swans. Per Wikipedia, a black swan is an unpredictable or unforeseen event, typically one with extreme consequences, an event that is beyond what is normally expected of a situation and has potentially severe consequences.

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