The Care And Feeding Of Bubbles

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“Find the Trend Whose Premise is False and Bet Against It.”

  • Continual growth on a finite planet. Obviously false. Trouble coming.
  • Debt and deficits don’t matter – they can always grow larger. Clearly false. Hyperinflation anyone?
  • The Fed will digitally create trillions of currency units with minimal long-term consequences. Not true.
  • The shale oil boom produces no profits while creating massive and expanding debt. What could go wrong?

Read: Charles Hugh Smith “The Pandemic Isn’t Ending

“The more authorities try to mask reality to maintain confidence, the more they destroy credibility, confidence, trust and faith. Once these intangibles are lost, the loss of confidence is self-reinforcing.

Depression isn’t just an economic number. It’s a self-reinforcing loss of confidence. Do you really think quarantining 400 million people will stop the pandemic?”


  • Bubbles always implode. Many bubbles exist now in early 2020. Expect implosions. There will be collateral damage.
  • The Fed and other central banks blow bubbles by creating excessive credit—new currency units—and manipulating interest rates too low via their central planning. When has central planning by a team of bureaucrats (or economists) worked well for anyone but the political and financial elite?
  • The coronavirus pandemic will have direct and secondary consequences for individuals, countries, markets, and economies. The risk of bubble implosions will increase. Coronavirus consequences could be the “pin” that pops many bubbles. The virus will be used as a believable scapegoat for a stock market crash, currency weakness and failing central bank policies.
  • Ayn Rand: “We can ignore reality, but we can’t ignore the consequences of ignoring reality.” We can ignore bubbles and pandemics, but we can’t ignore the consequences of bubbles and pandemics.
  • Gold will be the “last man standing.” Central banks, “inflate or die” policies, and their fake currencies cannot protect markets from a spreading virus, shale oil depletion rates, overwhelming debt, ever-increasing losses, diminishing solar output, unwise governments, failed banking policies, environmental destruction, and expensive wars.
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