Everything Solid Melts Into Air

Does Anyone Think This Can Last? Were you forwarded this email? [Sign-up to The Daily Reckoning here.]( [Unsubscribe]( [Daily Reckoning] Everything Solid Melts Into Air - We’re nearing the point when Everything Solid Melts Into Air… - Lovely fantasies… - A bet on the madness of crowds… Recommended Link [** Urgent Note From Jim Rickards – Response Is Requested By 10/26**]( I’ve just made a massive change to Strategic Intelligence. This is one of the biggest changes to a newsletter in the history of our business… As far as I know, nothing like it has been done before. What’s going on? In short, I’m adding 3 exciting new additions to this all-new “Pro level” of Strategic Intelligence. And as a current subscriber, I don’t want to see you miss out. That’s why — for a very limited time, until the timer below hits 0 — you’ll be able to upgrade your subscription to this new “Pro level” by clicking here. Seriously. I’d hate to see you left behind. [Click Here Before It's Too Late]( San Francisco, California October 23, 2021 Editor’s note: As inflation bubbles and goods shortages continue to mount, the stock market continues its record run, fueled by the Federal Reserve. As Charles Hugh Smith asks today, “Are we really crazy enough to believe this is going to work?” [Charles Hugh Smith]Dear Reader, We know we're close to the moment when Everything Solid Melts Into Air when extraordinary breakdowns are treated as ordinary and the "news" quickly reverts to gossip. So over 4 million American workers up and quit every month, month after month after month, and the reaction is ho-hum, labor shortage, blah, blah, blah, toy shortage for Christmas, oh, the horror, blah, blah, blah. These are large numbers. Over 10 million job openings and 6 million hires and 6 million "separations," i.e., layoffs and the 4.3 million voluntary quits. The happy story promoted by the corporate media is that this enormous churn is the result of shiny, happy people moving up the work food chain to better-paying jobs. We know we're close to the moment when Everything Solid Melts Into Air when every breakdown is instantly reworked into a happy story in which everything is getting better every day, in every way. The reality nobody in power wants to acknowledge, much less address, is that millions of workers are opting out or burning out and they're not coming back. Another happy story promoted by the corporate media is that once all the gummit freebies ended, the lazy, no-good workforce would be forced to take whatever wretched job the billionaires need done at low pay and zero benefits. (But hey, you qualify for food stamps, so it's all good!). “Up Yours” A substantial share of the workforce has declared, "Up yours!" and another share has been so burned out by overwork and constant pressure that they're done: They can no longer work at this pace and for that many hours. This enrages the lackeys, toadies, apparatchiks and apologists of the billionaires: How dare you escape from forced labor! The whole economy is based on the bleak choice of Take the job we offer or starve. The "innovation" (pay attention, neofeudal lords) from SillyCon Valley is to offer an illusion of "choice" in this forced labor system: In the gig economy, you get to "choose" between Gulag Camp One (low pay, long hours, zero benefits and zero security) and Gulag Camp Two (low pay, long hours, zero benefits and zero security). Wow! Who knew "choice" was so life-changing? Recommended Link [Bitcoin hits $50k (again) – here’s what to do now]( [Read more here...]( Bitcoin is surging again. But according to one of America’s top tech insiders, the smart move to make now isn’t to buy bitcoin – or any cryptocurrency. He says all the hype around bitcoin is hiding a bigger opportunity – one that could ultimately be a lot more lucrative for investors. He names his #1 way of playing it... [Click Here To See What It Is]( In a similar fashion, when you can no longer afford rent, utilities, etc., then you get a "choice" of living in your car, if you have one, or fashioning a crate-tent "home" or taking over the ruined camper left by the guy who made the one-way trip to the morgue. That the neofeudal lords and their lackeys offer the debt-serfs "choices" of forced labor would be comic if the results weren't so tragic. The neofeudal status quo is so busy chasing down escapees from the forced-work Gulags that it won't notice its Wile E. Coyote moment when Everything Solid Melts Into Air. Does anyone really think the current situation can last? Let’s think about this… Lovely Fantasies Imagine an economy so dominated by its central bank that all markets hang on every word of its priesthood as life or death. You know, like the Federal Reserve and the American economy. Now imagine this central bank issues enormous sums of new money that supercharges speculative activity such as hundreds of billions of dollars in stock buybacks, special purpose acquisition casinos, oops, I mean companies, and so on. You know, like the Federal Reserve's trillions in nearly free money for financiers. Next, imagine that the central bank makes barely concealed promises that should any big gambler lose money in the casino, the bank will flood the financial system with even more nearly free money for financiers and bail out the loser. Since flooding the system with nearly free money for financiers keeps the speculative frenzy going, the bank has implicitly promised that assets driven higher by speculative frenzy will never be allowed to drop. This promise naturally incentivizes even more speculative borrowing, leverage and risk, generating a titanic Everything Bubble in which risky assets skyrocket from pennies into dollars and dollars into fortunes. Now imagine that this speculative frenzy spreads into every nook and cranny of the economy such that everyone is drawn into one casino or another, and previously sober, cautious people are seized by a quasi-religious fervor in which they become convinced that their gambling chips on NFTs, SPACs, meme stocks, obscure alt-coins, homes, collectibles and pretty much anything within the manic swirl of speculative frenzy is now a can't lose path to carefree permanent wealth because the central bank guarantees it and anyone who questions this is in league with the devil (or worse). Recommended Link [If You Missed Tesla’s Epic Run – Do NOT MISS This!]( [Read more here...]( After Tesla surged a whopping 695% in 2020, everyone’s wondering… Can Elon Musk do it again? It’s anyone’s guess. But one thing’s for sure… It pays to follow what Elon Musk is up to. So we dug deep to get the “hidden Elon story” no one else is covering. This has NOTHING to do with Tesla… And EVERYTHING to do with Elon’s next big project. You do NOT want to miss this opportunity. [See What Elon Has Up His Sleeve]( More Fantasy Next, imagine that as a result of this vast expansion of "wealth" in the Everything Bubble, the entire economy is now dependent on this bubble never popping as speculation is driving incomes and a wealth effect without precedent as every participant feels newly empowered to borrow and spend more because their bubble wealth just keeps rocketing higher. The problem here is all speculative bubbles pop, and so the central bank's inflation of a speculative Everything Bubble has backed the entire economy into a corner from which there is no escape: Either the bubble must keep inflating to ever dizzier heights of delusion and risk or the bubble pops and lays waste to all the phantom wealth. Lastly, imagine that the enthralled participants in the speculative orgy truly believe the central bank has the power to keep the Everything Bubble expanding forever, or at a minimum bubbling along at a permanently high plateau that guarantees everyone's phantom wealth will be forever available for tapping and spending. This is where we are, and it raises one question: Are we really crazy enough to believe this is going to work? That the Federal Reserve can keep the Everything Bubble expanding essentially forever, or bubbling along at a permanently high plateau? A Bet on the Madness of Crowds Are we really crazy enough to believe that conjuring trillions of dollars out of thin air and then leveraging this into tens of trillions of dollars and dumping all this money into assets that don't increase in utility so that their "value" rises 10-fold even as their utility remains unchanged is sustainable and a solid foundation for our economy? Unbeknownst to the giddy participants, they're not just betting on the omnipotence of the Fed Politburo — they're also making a max-leverage bet that the madness of crowds will never end. Are we really crazy enough to believe this is going to work? The answer appears to be a resounding "yes" because everyone knows the Fed has our backs and so permanently expanding wealth is guaranteed. (And if it isn't, no problem, I'll jump off the merry-go-round before the music stops. And of course, 99.9% of all punters succeed in doing so.) In this blissful moment of speculative confidence in a) the music will never stop or b) I'll jump off just before the music stops, fortune fully intact, the risks are piling up. They’re just hidden from view. For many, they’ll only be visible when it’s too late. Regards, Charles Hugh Smith for The Daily Reckoning Editor’s note: This man just revealed [a $6.6 trillion secret…]( [Click here for more...]( Specifically, he blew the lid off a growing international conflict that’s already moving $6.6 trillion a day. That’s right, $6.6 trillion… Every. Single. Day. More importantly — he revealed [his proprietary secret]( for profiting from this massive daily flow of capital. If you want in, or at least want to discuss this $6.6 trillion secret, [click here now.]( --------------------------------------------------------------- Thank you for reading The Daily Reckoning! We greatly value your questions and comments. Please send all feedback to [feedback@dailyreckoning.com.](mailto:dr@dailyreckoning.com) [Charles Hugh Smith][Charles Hugh Smith]( is an American writer and blogger, and serves as the chief writer for the blog "Of Two Minds". Started in 2005, this site has been listed No. 7 in CNBC's top alternative financial sites, and his commentary is featured on a number of sites including Zerohedge.com, The American Conservative, and Peak Prosperity. Add feedback@dailyreckoning.com to your address book: [Whitelist us]( Additional Articles & Commentary: [Daily Reckoning Website]( Join the conversation! Follow us on social media: [Facebook]( [LinkedIn]( [Twitter]( [RSS Feed]( [YouTube]( The Daily Reckoning is committed to protecting and respecting your privacy. We do not rent or share your email address. By submitting your email address, you consent to Paradigm Press delivering daily email issues and advertisements. 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