Why The Next Black Swan Will Turn Into A Flock – 05.30.16

  • I was on the phone the other day with a friend, who is also my accountant. We’ve been friends going on 30 years. Once in a while our discussions will veer off into what is commonly known as “shop talk” where we find we’ve suddenly gone from “just gabbing” to a multi-hour intense conversation about markets, the economy, and more. This past one was a little more of “the exception” rather than just the average swing into the generic.
  • What I discerned from many of his responses was just how inadequately prepared, justifiably frightened, as well as, an overwhelming sense of foreboding was lying right below the surface of those many might deem from the outside looking in as people of wealth, industry leaders, or people who are just assumed to be “well off.”
  • What was just as illuminating was how many he explained “are just rolling the dice, thinking nothing could be as bad as 2008.” The additional problem? They think (or believe) if it happens again all they’ll have to do is the same as they did last time e.g. Hunker down, wait for the storm to blow over. Rinse, repeat.
  • The problem (in my opinion) with that thinking is this: What you think you can do this time, has already been severely handicapped or, removed all together. And most have no clue.
  • This is where the real issue lies for not only the Fed per se, but rather, the entire political as it is currently known. For if a “black swan” does indeed hit once again in the very near future? Once people realize just how systematically they’ve been cut off from those “assumed” resources, especially during a crisis? All hell is going to break loose in ways the academic class, as well as, the political never envisioned. For when the time comes (and there is no more important “time” than that during a crisis of confidence) where words truly matter, and everyone no longer believes? Everything changes. And I do mean: everything.
  • The subject which initially fueled the discussion to take off was when I cavalierly made a comment of, “I’ll bet you haven’t even noticed the change on your latest deposit slip from the bank?” To which of course he said, “What change?”
  • I relayed the fact that if you now deposit cash (and “cash” means just that: cash) into your account as per the deposit slip it now reads “Further review may result in delayed availability of this deposit.” (this incident was at Chase™ I’m quite sure it’s at others, and if not, will be coming soon to a bank near you)
  • Or, said differently: “Just because you deposited cash, it no longer means, or can be inferred, as an instant credit to your account which has been the case for years. And that’s a real problem many business people, never mind, your average person are going to find out the consequences of the hard way.”

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Source: zerohedge.com