Let's see, political civil war, militant activism, record wealth inequality, rampant anxiety, what's not to like?
There is only one "cure" for all of this insanity, which is to reject the modern way of life. To reject debt penury and otherwise stop trying to keep up with the Kardashians. However, the Millennials are just now experiencing their first pump and dump cycle, so they think this is all going just fine. They've never seen a bear market, nor a housing bubble, nor a Tech bubble. So now they will experience all three at the same time.
At the dawn of 2015, China was experiencing their slowest GDP in decades, so the PBOC decided to bid up the stock market to get the speculative juices flowing. Extolling the invincibility of central banks, Hedge fund manager Hugh Hendry called it "imagined realities" and he was all set to jump onboard:
Dec. 2014:
"China is set to record its weakest growth in GDP in 25 years. Yet it seems to have entered a bull market and may be where we deploy much more of our risk capital next year. That’s because the recent exuberant run up in onshore Chinese equities seems to me to amply demonstrate the power of imagined realities"
As we see it was a straight up, straight down pump and dump that exploded global markets in August of 2015. All caused by excess monetary liquidity. That event of course marked China's introduction to Japanification. Wherein markets begin trading in a wide sideways range. Which is what they've been doing ever since. Now currently at the February 2018 VixPlosion level:
If we go by the Chinese experience in 2015, the Fed will get this all under control after a -60% decline. Back then the PBOC did everything possible to stop the crash - including banning short selling, then they banned institutions from selling altogether. Next they shut down the market for days a time. Nothing worked. The market had to clear.
Now whose turn is it?
According to the post-pandemic investment hypothesis, we are to believe that the post-pandemic economy will be far better than the pre-pandemic economy.
This Wall Street recovery is America's imagined reality. Lockdown, re-open. Get rich quick. Why didn't anyone think of this sooner?
This was another lesson from Hendry:
"The worse the reality of the economy becomes, the more we take on the reflexive belief in further and dramatic monetary expansion and the more attractive the stock market looks"
There has been no sign of capitulation in this Tech decline.
BTFD all the way down.
And now the noose is tight.
In summary, this is called rented prosperity. The Japanese learned the hard way. The Chinese learned the hard way. And now the U.S. has to learn the hard way.
There is no such thing as effortless wealth.
