The conclusion that soaring asset prices mean the economy is strong is a hallucination that goes unrecognized because the entire financial system is hallucinating. Consider the data that the financial sector bases conclusions / decisions on (i.e. the data that the financial sector “trains” on) in a Bubble Economy like the present. The Bubble Economy’s core goal is to inflate the valuation of assets not by increasing utility-value or productivity but by artificially expanding credit and leverage. This benefits those who already own assets, as their collateral (i.e. “wealth”) expands without any effort, and this swelling collateral enables them to borrow money to … Continue reading
The post Model Collapse: The Entire Bubble Economy Is a Hallucination appeared first on LewRockwell.
