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The Chicago Fed National Activity Index fell .82 to -.55 in August, the 3-month moving average actually increased fractionally to -.07. This index covers some 80% of the economy and -.7 is generally considered to mean recession.

With central banks the world over pushing the debt based economic growth model for all its worth apparently oblivious to the obvious and documented perils. Along comes the OECD to warn the Federal Reserve, Bank of Japan and the European Central Bank on the hazards of record low and or negative interest rates, the socially and economically destabilizing asset bubbles they engender, the failure of the debt based economic growth model, the wholesale destruction of pension funds dependent upon decent bond yields to meet their investment return targets ala CalPers .6% return last year, and that economic growth was likely to average just 1% in 2016. If you ask me central banks have been playing with fire for quite some time now because the probability of another debt based economic implosion is both great and nigh. Yet they don’t seem to have any new ideas, the Bank of Japans latest plan to control the yield curve is akin to rearranging the deck chairs on the Titanic. The Japanese have played this game for 25-years, it hasn’t worked, and won’t work, continuing to do the same thing expecting a different outcome is the very definition of insanity, yet the world’s central banks follow glibly in their footsteps.


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