As we suffer the interminable wait for the global monetary and fiscal authorities to finally relent and allow some semblance of reality to creep back into the financial markets, it’s completely obvious that somebody has to be wrong here.
Either it’s possible to continue to inflate asset markets forever, even in the absence of organic (or even inorganic) economic growth, or it’s not.
If it’s not, and all of the central banker’s efforts prove to be a terrible idea (as we have been holding out at Peak Prosperity throughout the years), then the eventual correction will be larger, more painful, and more dangerous to world stability than any prior correction due to the enormous gap between reality and expectations. The potential energy stored up in the system right now is simply massive.
If we’re wrong, and it turns out that endless market ‘adjustments’ are both possible and the new normal, then we’re in for a very long and frustrating time — because it will mean that analysis and logic will take a back seat to the whimsical and event-driven decision making of a small unelected body of monetary authorities.
But our view is that the outcome is binary: either the central planners have all this under control forever, or they don’t.
Broken, Useless “”Markets””
Our financial markets are hopelessly broken. They no longer deliver useful returns or, more importantly, useful information.
The purpose of an actual market is to match buyers and sellers, the collective actions of which set prices. There’s an intelligence to true markets that is hard to match.
However, the endless tinkerings of the central planners of the world have created the opposite of "free and fair" markets — as central banks and their captive political collaborators long ago decided that they know better, that they should be the ones to determine what the ‘correct’ prices are for practically every asset in the world, tangible or financial.
Our financial and commodity markets are now so broken that they require the use of double quotation marks to reflect just how faux they really are. So from here on out, they will be referred to as “”markets.””
It’s All About Hope
What drives the equity “”markets”” higher at this point and prevents them from selling off?
Hope. Hope that central banks will interpret bad economic information as 'bad enough' to require even more freshly printed money be injected straight into the veins of the banking sector, as it has every time so far.
by pyranablade 
