Off the Cuff: Living in Denial

In this week's Off the Cuff podcast, Chris and Mish discuss:

• Egypt's Example
  • What happens once a nation overshoots its resources
• Europe Smoldering
  • Predicting which match will cause the explosion 
• Living in Denial
  • Current "all is well" meme will doom both markets & policy

Happy July 4th! (a day where we traditionally celebrate combining pyrotechnics with liquor – "What could go wrong?" Chris asks.)

In addition to the United States' festivities, figurative fireworks are exploding around the world. Egypt is the biggest example, with its year-old (and first-ever) democratically-elected President being ousted by the military yesterday.

The unrest there is is rooted in a larger resources issue to which there is no political solution. Want to see what happens when a nation enters overshoot of its "Three E" constraints? Egypt is giving us a real-time preview…

Meanwhile, the European Central bank just announced it's going to hold interest rates at their current lows for an "extended time". Somehow, that's inspiring to the financial markets despite its signaling how unstable the Eurozone still is after years of intervention aimed at healing it. Chris and Mish seek to identify where the next big breakage will occur and agree that the game will be up once the (German) populace starts refusing to dump more of its savings into the bottomless pit.