Slow Motion Banking Crisis, Centuries in the Making, Coming to a Head

Slow Motion Banking Crisis, Centuries in the Making, Coming to a Head, by Sven Henrich.

Game over. The grand central bank experiment of the last 10 years has ended in utter and complete failure. The games of cheap money and constant intervention that have brought you record global debt to the tune of $250 trillion and record wealth inequality are about to embark on a new round of peddling blue meth again.

Australia has already cut, so has India. The ECB is talking about it, markets are already pricing in multiple Fed cuts. The new global rate cutting cycle begins anew before the last one ever ended. Brace yourselves as no one, absolutely no one, can know how this will turn out.

Absolutely staggering. We are witnessing a historic unraveling here. Everything every central banker has uttered last year was completely wrong. Every projection they made over the last 10 years has been wrong. No wonder Jay Powell wants to toss the dot plot. It’s a public record of failure.

Why place confidence in people who are staring at the ruins of the policies they unleashed on the world and are about to unleash again?

All the distortions of 10 years of cheap money, debt, wealth inequality, zombie companies, negative debt, TINA, you name it, will all be further exacerbated by hapless and scared central bankers whose only solution to failure is to embark on the same cheap money train again. All under the banner to “extend the business cycle” at all costs. Never asking whether they should nor considering the consequences. But since they are not elected by the people and face zero consequences for failure they don’t have to consider the collateral damage they inflict.

I repeat: Structural bears who have predicted that central bankers would never be able to normalize the construct they created and has produced the world’s greatest debt explosion ever were 100% correct. We’re all staring at a colossal policy failure with no accountability. …

Stock markets can’t sustain gains or record prices without intervention, without a helping hand, without dovish and intervening central banks. …

This is not capitalism, nor does this ongoing farce constitute free market price discovery. It’s politburo based central planning, desperately trying to keep the balls in the air. …

The grand central bank experiment has been revealed to be a colossal failure. Brace yourselves.

Public servants set interest rates by diktat. 90%+ of new money is manufactured by private banks out of thin air and let out at interest. Financial bubbles have financed a huge expansion  of the welfare state, and now voters are hooked on it. What could possibly go wrong?

That graph again:

David Evans, money supply