Executive Summary

• Why economic growth is not going to ride to the rescue
• The alarming warning signs the auto, fine art, retail & housing industries are flashing now
• The actions you should be taking now to protect yourself from (and position for) the coming crash

If you have not yet read Part 1: Why This Market Needs To Crash  available free to all readers, please click here to read it first.

Sometimes I wonder if I'm ever going to run out of new things to say about the state of the world, especially economics.  The more obvious our predicaments become to me, the less appetite there seems to be ‘out there’ to discuss them.

What more can be said about a system that is so obviously corrupt and destined to fail, and piles up more and more evidence that this is the case, and yet refuses to engage in the most minimal of introspection? 

Well, lots as it turns out. 

All of this is endlessly fascinating as long as you enjoy a good mystery, know that the stakes are actually quite high, and are interested in preserving your quality of life.

You see, we're finally getting to beginning of the end.  Our long national, and even global, experiment with using flawed economic models are now running smack dab into reality.

The edifice of omnipotence is crumbling and when it finally breaks down in earnest, the financial markets will implode, the central banks will be overrun and discredited, and people will discover that really long parties come with massive hangovers.

There will be hell to pay.

I’m still not sure if we’re a week away from this or five years, but such is the fate of living within a nested set of complex systems run by complex humans.  One simply cannot predict exactly what or when, but we can track the ‘fingers of instability’ and note that these are growing longer, and steeper.

The way this was all supposed to work out and make sense was if, and only if, rapid GDP growth came back to the land.  It did not.

Moribund GDP: The Elephant In The Room

For reasons we have discussed previously, and extensively,  GDP growth has not been a feature of the world stage for over a decade, and is unlikely to return both because of debt levels that are far too high to support rapid growth and because any return of rapid growth will run smack into higher oil prices.