This is the week-of-weeks when the official grand viziers of finance gather at Jackson Hole, Wyoming, to confab and interpret the lay of animal neck-bones and other auguries scattered in the sand, with the hope of steering the awesome powers of the universe this was or that as they affect the operations of money. The exercise is hardly different in function from the sort of rude ceremonials that took place on top of Sumerian ziggurats and Aztec temples — to reassure the masses that effective spells for favor of the Gods have been cast — except that in our civilization money is God.
Or “money,” we should say, because the old definitions don’t fit so well anymore. It used to have a straightforward relationship with the work required to produce actual things of value, but those days are gone. “Money” nowadays is a byproduct of wishful analytics and computer legerdemain seasoned with generous measures of fraud and larceny. This is a big problem when everything is measured in money and it becomes quite impossible to state with assurance what the value of money actually is. Obviously, you end up not knowing the value of anything.
That’s the perilous situation the world faces. And since the USA is the straw the stirs the world’s drink — at least for now — the utterances emanating from Jackson Hole may determine which way that situation turns. We should suppose that the officers of the Federal Reserve are upright, well-intentioned, patriotic people. No doubt they think they are. But the perilous situation is largely one of their own making, and seems to be veering out of their control, and reputations are at stake. Their task at this year’s Jackson Hole confab is to maintain the appearance of confidence in their own rituals. But with a kicker.
That kicker is named T-r-u-m-p. This modern Balaam, riding the ass of the Deep State into wickedness, must be stopped, perhaps at all costs. On his way to the oval office last fall, Trump prophesied that the stock markets represented “one big, fat, ugly bubble.” That was an offense to the grand viziers, for whom the elevated stock market valuations stood as the main testament to their power and wisdom. In fact, it was the only testament, and a rather flimsy one. More recently, though, the wicked Trump changed his tune and declared that the tower of stock market exaltation was his own doing, setting himself up for the revenge of the grand viziers.
Since nothing else has worked so far to dislodge Trump from the White House, a tumbling tower of stocks might seal his fate. The tower has to fall anyway, lest the moiling masses of flyover America think about besetting Wall Street with pitchforks and torches. A controlled demolition might be just the thing to appease these suffering holders of three part-time jobs (if they are so lucky) who have stood by in wonder and nausea while a tiny fraction of the elite gather unto themselves all the dwindling riches of the realm — at least in paper securities denominated in US dollars — while the wicked Trump will be left to the jackals of the Deep State, to be torn apart with the 25th Amendment.
Trouble is, the “controlled” part of the demolition. Janet Yellen and the rest of the crew in their conical hats might want the markets to fall by a manageable ten or maybe even twenty percent. After all, they probably believe they can tweak them back up in another six months, like the last couple of times. But they can only pretend to calibrate that tumble, just as they pretend to regulate the employment numbers that supposedly represent the real economy of things, activities, and people. What if the demolition gets out of hand? What if the markets sink fifty percent, seventy? What if the bond market, which is way bigger than the stock markets, catches the infection and goes kerblooey? What if congress, in its raging idiocy, shoots the credibility of the nation in the head by failing to raise the debt ceiling?
Things could get mighty complicated. The viziers know that the powers of the universe have a mysterious will of their own. Mostly, they have a will to re-balance the things of this world that have strayed from the accounting sheets of reality, namely the true prices of everything. And from that point the value of things may become visible again. Won’t that be a mighty moment?
So mind what these characters say in the hours ahead at Jackson Hole, and mind what they set into motion as they do.
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