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GBOAT: Is This the Greatest Bubble of All Time?

This article was originally published by Charles Hugh Smith at Of Two Minds Blog. 

The lifestyle you ordered in the euphoria will be out of stock in the panic.

Humans running Wetware 1.0 (which is all of us) love to gamble, and we are entranced by the thrill of victory and the agony of defeat. When there’s a market for speculation, these wild swings of emotion manifest as euphoria (I’m winning!) and fear (I’m losing).

Thus the soaring price of goats due to speculation in 1740 B.C. Babylon so vexed Hammurabi that he ordered the execution of those he deemed responsible for profiteering off their clever speculative manipulation.

Speaking of goats, let’s ask a GOAT (greatest of all time) question: what’s the greatest bubble of all time (GBOAT)? The easiest way to measure speculative bubbles is the starting price and the peak price, but that may not do justice to the question. Perhaps the number of people drawn into the speculative frenzy is a better measure of GBOAT: after all, if only a handful of speculators lose their shirts, how that can be the greatest bubble of all time?

To even qualify, a bubble must draw the masses into the euphoria and then slaughter them as mercilessly as Hammurabi massacred the goat profiteers.

Another qualifying factor is the scale of disconnect from reality. Even if you overpaid for a goat in a speculative mania, at least you can still milk the goat and make cheese. But tulips, which drove the remarkably excessive speculative Tulip Mania in 1636 Holland, are not even edible.

At least tulips offer a bit of beauty in a world besmirched by speculative ugliness, but the shares of the South Seas Company that sucked in the best and brightest in 1720 Britain and proceeded to lay waste to their wealth did not even have that saving grace.

Another qualifying factor is the power of the delusion driving the bubble. To qualify as a contender for GBOAT, the mania has to be utterly convincing and persuasive to everyone involved. In other words, it isn’t even speculation to invest all your money in the bubble, it’s simply common sense due to the dead certainty of the proposition fueling the mania.

The 1999-2000 Dot-Com Bubble is a good example of the universality of belief in the obviousness of the gains to be reaped: the Internet was changing the world and would expand for decades, so obviously the companies involved would grow for decades, too, as would their profits (obviously!).

The chart of the dot-com bubble offers a textbook example of how a bubble gathers momentum, spikes to insane heights, falters as the smart money exits but soars to a lower high as true believers buy the dip. Once the buying is exhausted, the bubble collapses back to its starting level.

But not all bubbles follow this trajectory. Here is a current chart of IWM, the Russell 2000 index, courtesy of NorthmanTrader.com. (I added the black box and the red line in the center panel to indicate the previous bubble top.) The violence and amplitude of this speculative mania over the past year makes the dot-com bubble appear quaintly staid in comparison.

So let’s make the case that we’re experiencing the greatest bubble of all time in real-time. The magnitude of the price movement is extreme: check. The number of people sucked into the mania is extreme: check. The power of the delusion is extreme: check. (The Fed will print trillions forever, the federal government will borrow and blow trillions forever, the world is about to enter the Roaring 20s, technology is changing the world, etc. etc. etc.) The gains to be reaped are extremely obvious: check.

History leaves no doubt that all speculative bubbles pop, and much sooner and more violently than the euphoric participants believe possible. Before Hammurabi shut down the mania in goats, a rare goat with distinctive markings could be traded for an entire house. After the bubble popped, it was just another goat.

The lifestyle you ordered in the euphoria will be out of stock in the panic. Everyone running Wetware 1.0 is prone to getting caught up in a mania in which a tulip or goat can be traded for a house. But then euphoria flips to fear and after the mania fades and the losses have crushed spirits, hopes, and dreams, a tulip is once again just a tulip and a goat is once again just a goat.

NOTE: I made up the story about the bubble in goats and Hammurabi. That is fiction, not history.

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The post GBOAT: Is This the Greatest Bubble of All Time? first appeared on SHTF Plan – When It Hits The Fan, Don’t Say We Didn’t Warn You.

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Positive For Coronavirus: Goats and Papayas

We are constantly told that we need “more testing” in order for people to be minutely “allowed” to be free. But according to a study done by Tanzania, the testing kits are so unreliable that goats and papayas have tested positive for COVID-19.

This whole scamdemic is proving rather quickly that this was nothing more than a tyrannical power grab, and we all know it. But this is just more evidence that they continue to lie to keep us in a constant state of fear so they can control us.

The Science of Fear: How The Elitists Use it to Control Us & How to Break Free

President John Magufuli said during an event in the northwest of Tanzania that the test kits were imported from overseas, but did not say where according to the Independent.  He said that in order to evaluate the quality of the kits, Tanzanian security forces randomly obtained non-human samples, including from a pawpaw (papaya), a goat, and a sheep. The random samples were assigned human names and ages and sent to a laboratory to test for coronavirus.

Tanzania has recorded 480 positive cases of coronavirus and 17 deaths as of Sunday. Magufuli said during a speech he was sending a plane to Madagascar to collect a herbal “cure.” He said: “I’m communicating with Madagascar. They have got a medicine. We will send a flight there and the medicine will be brought into the country so that Tanzania too can benefit.”

The World Health Organisation (WHO) warned against believing in the herbal tonic, and said there is no proof of a cure for coronavirus. The WHO did not recommend “self-medication with any medicines” and warned there were “no short-cuts” to finding treatment for the virus.

If you haven’t realized what’s going on right now, I’m not sure if you’ll ever be convinced that you’ve been enslaved by ignorance and fear.

The Science of Fear: How The Elitists Use it to Control Us & How to Break Free

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Episode-2602- Kinder Goats on the Homestead with Roger McDowell

Roger grew up on a small family farm in central Kentucky. His working class parents taught him the value of a strong work ethic from a young age. They grew/raised much of what they ate from a variety of livestock Continue reading →

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