Category Archive: 5.) Charles Hugh Smith

Yes, It Is Different This Time

Most people would be horrified by a 40% decline in their "investments." When bubbles pop, speculative assets don't drop 40%, they drop 90% or even 98%.

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For Freak’s Sake, People, Even the Crash Test Dummies Are Nervous

Those trusting the Fed to be visibly weak, corrupt and incompetent forever might be in for an unwelcome surprise. When even the crash test dummies are nervous, it pays to pay attention. Being in a mild crash isn't too bad if all the protective devices inflate as intended. But in a horrific crash where nothing goes as planned, it's like speeding in a ready-to-explode Pinto and being side-swiped by a semi on Dead Man's Curve.

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It’s All the Aliens’ Fault

As for our central banks' defaulting on their lines of credit with the Martian Central Bank--that's another alien intervention we'll live to regret. I hope this won't shock the more sensitive readers too greatly, but I've discovered undeniable evidence that all our planet's problems are the result of alien intervention. Yes, aliens exist and are actively intervening in humanity's activities, to our great detriment. Wars, plagues, The...

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Calm Before the Storm?

Stocks don't vanish when sold; somebody owns the shares all the way to the bottom. These owners who refuse to sell because they have convinced themselves the next dip will be the hoped-for resumption of the bullish trend are called "bagholders."

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Autocracy’s Fatal Weakness

This desire for compliance and consensus dooms the autocracy to failure and collapse because dissent is the essence of evolutionary churn and adaptation. The various flavors of autocracy (theocracy, kleptocracy, dictatorship, etc.) look remarkably successful at first blush but they all share a fatal flaw.

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How Healthcare Became Sickcare

The financialization of healthcare started two generations ago and is now in a run-to-fail feedback loop of insolvency. Long-time readers know I have been critical of U.S. healthcare for over a decade. When I use the term sickcare this is not a reflection on the hard work of frontline caregivers--it is a reflection of the financialization incentives that have distorted the system's priorities and put it on a path to insolvency.

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Risk Accumulates Where No One Is Looking For It

All this decay is so incremental that nobody thinks it possible that it could ever accumulate into a risk that threatens the entire system. The funny thing about risk is the risk that everyone sees isn't the risk that blows up the system. The mere fact that everyone is paying attention to the risk tends to defang it as everyone rushes to hedge or reduce the risk.

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Serf-Expression

Eventually the "flock of timid and industrious animals" changes their minds about how much exploitation by the few is acceptable.

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The Upside of a Crushing Recession

Unbeknownst to those trembling in fear of a crushing recession, the crushing recession they fear is the only curative for a fatally distorted system which has lost touch with reality. Everyone looking at the inevitability of recession with alarm is forgetting the many upsides of recession, especially one that crushes all attempts to reverse it with the usual tricks.

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If You Want to Build Back Better, Reshore Our Entire Supply Chain

It is entirely accurate to say that the U.S. is addicted to waste and distant sources of essentials. The downside of dependency is in the air. The U.S. has allowed itself to become dependent on other nations for essentials, a policy that I view as an insanity fueled by greed. The problem with dependency is the cost can't be calculated until it's too late. Restoring independence is a massive, costly undertaking, but if you wait until the cost of...

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Geopolitics and Degrowth

The Geopolitics of Degrowth holds that real power flows not from waste, centralization and coercion but from decentralization, relocalization and the free flow of value. Conventional geopolitics is all about more: more military power, more sanctions, more coercion, more influence. The Geopolitics of Degrowth is all about the the power of less: wasting less, consuming less, needing less from other nations, reducing dependence on rivals,...

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Our Financial System Is Optimized for Sociopaths and Exploitation

Let's call this financial system what it really is: the MetaPerverse, a conjured world of self-serving cons. We live in a peculiar juncture of history in which truth has been banished as a threat to the maximization of private gain, i.e. the hyper-pursuit of self-interest. Evidence that supports a causal chain has been replaced by cherry-picked data that supports a self-serving narrative: both the evidence and narrative are manufactured to serve...

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Our Leaders Made a Pact with the Devil, and Now the Devil Wants His Due

The unprecedented credit-fueled bubbles in stocks, bonds and real estate are popping, and America's corrupt leaders can only stammer and spew excuses and empty promises. Unbeknownst to most people, America's leadership made a pact with the Devil: rather than face the constraints and injustices of our economic-financial system directly, a reckoning that would require difficult choices and some sacrifice by the ruling financial-political elites,...

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How Empires Die

When the state / empire loses the ability to recognize and solve core problems of security and fairness, it will be replaced by another arrangement that is more adaptable and adept at solving problems. From a systems perspective, nation-states and empires arise when they are superior solutions to security compared to whatever arrangement they replace: feudalism, warlords, tribal confederations, etc.

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Inflation Winners and Losers

The clear winners in inflation are those who require little from global supply chains, the frugal, and those who own their own labor, skills and enterprises. As the case for systemic inflation builds, the question arises: who wins and who loses in an up-cycle of inflation? The general view is that inflation is bad for almost everyone, but this ignores the big winners in an inflationary cycle.

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The Cult of Speculation Is a Cult of Doom

Surely the Fed gods will affirm the cult's most revered articles of faith. But false gods eventually fail, even the Fed. Every once in awhile the zeitgeist sets up an either / or: either the zeitgeist is crazy or I'm crazy. (OK, let's agree I'm crazy; see, it's not that hard to find something to agree on, is it?)

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Politics Is Dead, Here’s What Killed It

Here's "politics" in America now: come with mega-millions or don't even bother to show up. Representational democracy--a.k.a. politics as a solution to social and economic problems--has passed away. It did not die a natural death. Politics developed a cancer very early in life (circa the early 1800s), caused by wealth outweighing public opinion.

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The Real Revolution Is Underway But Nobody Recognizes It

Revolutions have a funny characteristic: they're unpredictable. The general assumption is that revolutions are political. The revolution some foresee in the U.S. is the classic armed insurrection, or a coup or the fragmentation of the nation as states or regions declare their independence from the federal government.

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The Real Threat to Democracy is Corrupting Wealth Inequality

Try to find a developing-world kleptocracy in which the top few collect more than 97% of the income from capital. There aren't any that top the USA, the world's most extreme kleptocracy. We're Number 1. Imagine a town of 1,000 adults and their dependents in which one person holds the vast majority of wealth and political influence. Would that qualify as a democracy?

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Why Don’t We Cut Out the Middleman and Just Elect Pfizer and Merck?

If we no longer have the capacity to distinguish between moral legitimacy and self-serving corruption, then we might as well eliminate the Middleman and vote directly for Pfizer or Merck. There's a fancy word for cutting out the Middleman: disintermediation. Removing intermediaries who take a cut but neither produce nor add value makes perfect sense, reducing costs and increasing efficiency.

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