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Opportunity Squandered: We Blew It

We are about to reap the consequences of tolerating the perfection of the Savior State / cartel-crony capitalism’s neofeudal debtocracy.

We as a nation had an unparalleled, historic opportunity to set things right in the aftermath of the 2008 financial meltdown. Alas, we blew it. Instead of tearing down what had failed spectacularly, we chose to do more of what failed spectacularly: cartel-crony capitalism, centralized wealth and power and an expansion of our financialized debtocracy.

Gordon Long and I discussed this epic miss in Window of Opportunity: Blown!

While it’s certainly easy to blame our corrupt, self-serving leadership, we have tolerated their “more of the same.” It’s been said that a people get the government they can tolerate (as well as the one they deserve), and the American people have tolerated an expansion of everything that is systemically destructive because we dared not risk our share of the Savior State swag.

The joke will be on us, because there won’t be any swag when the rotten edifice collapses in a heap. The entire Status Quo response can be summarized thusly: save cartel-crony capitalism and increase central state power by expanding credit and blowing borrowed trillions, i.e. paper over structural flaws with tsunamis of free money and credit.

Let’s check in on the effectiveness of the Keynesian Cargo Cult’s project of borrowing and blowing trillions: Oops, diminishing returns.

Does this trajectory of federal borrowing look remotely sustainable to you?

The Federal Reserve’s number 1 project of bailing out the parasitic financial cartel with trillions of dollars in free credit has also failed spectacularly, as the banks can’t find any positive risk/return in loans except those that are guaranteed by the Federal government (FHA, Fannie Mae, etc.)

The Federal Reserve’s number 2 project of “saving” cartel-crony capitalism and its captured political class of toadies, apparatchiks and factotums by blowing asset bubbles has succeeded in setting up one violent crash after another. You don’t need Technical Analysis 101 to see the megaphone pattern traced out by the three Fed-inflated asset bubbles.

As you no doubt recall, nobody in the Fed, Wall Street or the Savior State saw the inevitable popping of the tech bubble or the housing bubble, and so it is unsurprising that our “leadership” has once again failed to anticipate the endgame of financial bubbles is not “to the moon” but collapse.

“But that can’t possibly happen.” Yes, we heard that in 1999 and 2006, too. What must happen will happen, and we as a nation are about to reap the consequences of tolerating the perfection of the Savior State / cartel-crony capitalism’s neofeudal debtocracy.

About the author

Charles Hugh-Smith

Things are falling apart--that is obvious. But why are they falling apart? The reasons are complex and global. Our economy and society have structural problems that cannot be solved by adding debt to debt. We are becoming poorer, not just from financial over-reach, but from fundamental forces that are not easy to identify or understand. We will cover the five core reasons why things are falling apart:

  • 1. Debt and financialization
  • 2. Crony capitalism and the elimination of accountability
  • 3. Diminishing returns
  • 4. Centralization
  • 5. Technological, financial and demographic changes in our economy


Complex systems weakened by diminishing returns collapse under their own weight and are replaced by systems that are simpler, faster and affordable. If we cling to the old ways, our system will disintegrate. If we want sustainable prosperity rather than collapse, we must embrace a new model that is Decentralized, Adaptive, Transparent and Accountable (DATA).

We are not powerless. Not accepting responsibility and being powerless are two sides of the same coin: once we accept responsibility, we become powerful.

Read Charles Hugh Smith's Why Things Are Falling Apart And What We Can Do About It

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