Chemistry professor, and infamous market observer Dave Collum, author of the encyclopedic ‘Year in Reviews’,senses “existential risk in the American Experiment.” In an excellent interview with The Cornell Review, Collum opines on everything from ‘safe spaces’ to ‘social unrest’ warning “people are now mad, and it shows in the chaotic election. We are guaranteed to elect a president that half the populace finds repugnant…Change is in the air.”
…It is probably only in the last 15 years that I’ve started hiking up my pants and bitching about the government. Now I am relatively outspoken because I sense existential risk in the American Experiment.
…We have an interventionist central bank—a global cartel of interconnected central banks actually—that is determined to use untested (read: flawed) models to try to repair an economy that was hurt by their policies and would fix itself if the Fed would just get out of the way. I think these guys are what Nassim Taleb calls I-Y-I (intellectual-yet-idiot). They will continue with their experiments until the system finally breaks in earnest. They will blame the unforeseeable circumstances.
The social contract on the home front is faltering badly. When the system started to fail in ’09, we stitched up a putrid wound without cleansing it. We needed reform of a highly flawed banking system corrupted by poor incentives. In the 1930s, the Pecora Commission rounded up scoundrels (including the head of the New York Stock Exchange) and threw them in prison. We should have hung a few in the town square, but instead the Obama Department of Justice punished shareholders and savers. A scandal at Wells Fargo emerging just this week, for example, led to a token fine while leaving some wondering if Wells Fargo is too corrupt to exist in its current form. It is not the government’s job to break up these institutions, nor should it save them.
We have stirred up a mess in the Middle East that seems to be washing up on our shores. (This weekend there were a half dozen attacks that appeared highly correlated to all but those in the politicized press.) Our policy in Syria is incomprehensible. The refugee crisis in Europe is our doing, and it is spreading. Fear of Trump seems odd given that the current neocons in liberal garb are stunningly militaristic. I think they are war crimes. Meanwhile, these I-Y-I’s insist on poking Putin in the eye with a stick as part of a policy that appears to be designed to take us to the brink of far greater armed conflict.
People are now mad, and it shows in the chaotic election. We are guaranteed to elect a president that half the populace finds repugnant. It’s hard to imagine that the post-election temperament will improve. Change is in the air.
…Social unrest in America has been around for centuries. We seem to end up better off when the upheaval is over, but it can be a painful period. As recently as the 1960s college campuses were going nuts over social, racial, and geopolitical issues. The current phase is just recycling, but where are the stop-the-war activists? It seems to me that the world is being stretched at the seams and at risk of moving into a very hostile period. Meanwhile, the student activists appear to be looking inward. I am sure the current generation of activists would not agree. I highly recommend a book by Strauss and Howe entitled, “The Fourth Turning” published in 1996, which describes the large wavelength human cycles (80 years) as comprised of four 20 year cycles. The Fourth Turnings—the generational phase in which society goes through painful, cathartic change—include the Great Depression/World War II, the Civil War, the Revolutionary War, and the Salem Witch Trials. They predicted the next catharsis would arrive around 2010. We shall see, but it looks like they may have stuck that landing like a Russian gymnast.
With Deutsche Bank’s “issues” reverberating around global markets, Dave may be closer to that realization that he knows.