Government Has Gone Insane – That’s What a Phase Transition Is All About

“Whom the gods would destroy, they first make mad,” was spoken by Prometheus in Henry Wadsworth Longfellow’s poem “The Masque of Pandora”. This seems to be very appropriate to explain our government officials for they are truly insane when it comes to economics. This is all about them sustaining a failed system that is unsupportable. They refuse to look at what they are doing and instead they are clamping down on everyone destroying the very fabric of the world economy.

If The Fed Continues This, “There Won’t Be Any Active Managers Left In 5 Years”

As the dash-for-trash continues in US equities, Neuberger Berman sums up the state of investing currently, “there has certainly been little reward for owning high-return, superior business models that are conservatively financed,” as Bloomberg notes, Fed policy has had the “unintended consequence” of boosting the stocks of companies with heavy debt and little or no earnings. Typically after a recession, such companies lose out to firms that generate more cash and have better balance sheets; this time, no “Darwinian” shakeout happened and low-quality stocks ruled. Managers say they haven’t changed, the market has. The Fed’s QE/ZIRP world has artificially inflated prices of lower-quality U.S. stocks, punishing those who focus on businesses with the best fundamentals, “if the next five years are the same, there won’t be any active managers left.”