Saturday, March 7, 2020

Shanghai Surprise

We live in a mindless corporate Borg programmed from birth to self-destruct. For fun and quarterly profit...

Shanghai Surprise is the moment when a generation of idiots realizes that printed money is not the secret to effortless wealth. Japan has learned this lesson, and so has China. Now it's America's turn.

“There is no means of avoiding the final collapse of a boom brought about by credit expansion.  The alternative is only whether the crisis should come sooner as the result of voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.”
- Ludwig von Mises

This is not sooner.

Corporations have cultivated a useful Idiocracy to be harvested at their disposal, and now we are seeing the full effect.

An American obesity rate twice the OECD average and corporate healthcare profiteering twice the OECD average have yielded to an inevitable opioid overdose crisis, driven by Big Pharma cashing in on lethal painkillers. Corporate euthanasia.

Central banks have put their own euthanasia to work in Financial markets via lethal doses of monetary dopium. Gamblers are so stoned they viewed the Corona plague as a buying opportunity:

February 21st:

"You would think that the coronavirus concerns gripping China (and the world) would cause massive panic and fear in stock prices. And it sure felt like they were... for a moment at least. But it didn't last long.

Instead, the U.S. market hit new all-time highs just a week after bottoming. And it has continued higher since.

This, my friend, is the Melt Up."

The Corona melt-up was the Imagined Reality of 2020. The moment when global collapse was viewed as a last chance buying opportunity by like-minded zombies taking their cues from Reddit message boards.

In a deja vu repeat of 2015, quarantined Chinese gamblers have been bidding up their own stocks amid unprecedented PBOC liquidity. It never occurs to them that if they are at home gambling, there is no one outside in the shopping malls. Central banks have created a lethal negative correlation between asset prices and the economy. A lethal disconnect which up until the past two weeks was growing ever wider.

2015 China Smash Crash + 2018 VIXPlosion = 2020 Super Crash

Some of you may recall that last week I posted this exact same chart, indicating a potential for another Blue Monday. However, in the event, the BOJ came to the rescue last Sunday night kicking off an entire week of central bank casino bailouts. 

The BOJ bailout saved the day. Monday. And then Powell's rate cut and biblical low U.S. yields unwound all of their work. Which is why gamblers are going to need a much bigger bailout this week. I think we all see where I'm going with this:

Corporations have hollowed out every aspect of society. The economy, the environment, but mostly the people. Today's brain dead iPhone idiots are the crowning achievement of corporate domination. An external gratification Borg now directed by ad-sponsored messaging delivered instantly by iPhone.

These people are taught from birth to be unhappy and to seek external gratification through consumption. They are dopamine addicts controlled by their corporate overlords. The new slavery is via debt. These people have no inner peace or zen, they are taught to seek competitive conformity and to broadcast fake happiness on social media. Inside they feel dead and empty. As they age, the dopamine highs diminish and the body becomes riddled with continual abuse. Until one day the opioids become the best option. These people never take the time to cultivate their true selves and inner character. Always pretending to be someone else, happiness is never more than a fleeting mirage.

We have reached the apex of this dead "way of life". A depressed zombieland now electing criminals to be president. Technology has dumbed people down to the point at which they are incapable of thinking for themselves. A con man's paradise.

Nothing is new under the sun for the hairless monkey. Our weaknesses are programmed into our DNA. Emotions never change over thousands of years, regardless of how much knowledge collects dust in our ever-growing libraries. It's useless when compared to a skilled demagogue preying on ignorance. If people continue to only live their external gratification lifestyles, this species will never stop making the same mistakes over and over again. Never understanding that the fatal weaknesses are not outside us, they are inside us. Greed, fear, ego, arrogance, laziness, envy.

Institutions were selling in size this week as Trump and his merry band of criminal accomplices gave them their last chance out of the Casino. So they hit the dumb money bid with both hands:

The bottom line is that the carbon output is collapsing as I said it would. The solution to this society's excessive carbon footprint was mass denial. And it's working fantastic. Now, they are even afraid to go on airplanes. 

The sensationalist headlines are click-bait designed to prey on fears. Fear is by far the most powerful human emotion. These "death toll" figures are meaningless and entirely without context. Thousands of people are dying every day of all different causes, but all we hear about is the latest body count from one of the LEAST fatal causes. I would venture that McDonald's kills more people every minute than Coronavirus has killed to date (rough approximation).

A wise man once said at the nadir of the Great Depression, "We have nothing to fear, but fear itself" (President Franklin Roosevelt). Unfortunately, we are a long ways down to that moment of rock bottom realization. There is a lot of panic between here and there. 

Fear and denial are now doing what no amount of Paris Conferences could accomplish.

Imploding a failed way of life in real-time, while denialist consumption addicts pretend it's not happening. 

Prepare for Shanghai Surprise. And biblical panic.