- Why the debt market is the powder keg that will blow things sky-high
- The most dangerous asset bubbles to watch and avoid
- The implications of a collapse in the bond market
- Where will money then go?
The big problem with central bank policies, besides driving the largest wealth and income gaps in all of recorded history, is that they’ve massively deformed the financial and economic landscape.
Too-cheap money has distorted just about everything, and has badly warped corporate incentives. There’s literally no place one can look and not find an economic or financial distortion. “Gains” (such as they are) have gone to holders of financial assets, and corporations have opted to buy back their own shares and to not re-invest in property, plant, equipment or people.
All of this will work right up until the day it doesn’t. And then we'll experience a financial and economic crisis likely to be the largest we ever live through.
And these distortions are not only everywhere, but they are all at record levels. As in never higher in human history.
Just looking at the corporate data alone ought to scare the pants of off every investor on the planet. As the chart below makes clear…