Wordy Intellectuals
Rocky Rollouts
The Devil and the Deep Blue Sea
Fourth Turning
The Stumble-Through Economy
Puerto Rico and the Gym

We are on the horns of a dilemma, caught between the Scylla and Charybdis, a rock and a hard place, the devil and the deep blue sea, the anvil and the hammer. The walls are closing in. We’re in a tight spot.

All those metaphors (I could list more but will spare you) fit the present economic situation (some are now calling the omni-crisis) and I think will also describe the 2020s.

Thanks to forces that were already in motion and coronavirus as the trigger, we are out of good choices. Every possible fiscal, monetary, social, and political policy will have negative effects, some larger than others. All we can do is choose who gets hurt and in what ways. That’s a bad place to be, but it’s where we are.

This week’s Federal Reserve policy meeting gave yet more evidence that no one, even the mightiest central banks, can restore the growth to which we have grown accustomed. The best the Fed can do is (sorry to use more metaphors) keep the life raft afloat by continuing what they have done for decades.

And that’s the problem. In their effort to improve things/prevent pain, Fed officials past and present financialized the economy. That, along with more unintended consequences from government debt and regulatory interventions (all well-intentioned, you understand) brought us to where we are today. We can’t walk it back without a great deal of pain no one wants to take, including your humble analyst.

So we stumble into the life raft. That’s not nothing. As long as we’re afloat, we still have hope. We can do things that may help. But it’s not ideal.

We didn’t have to be here. But, like I said, we are here. The next question is where are we going? Today we’ll explore that question.