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Japan's The Tinder That Set The World's Bad News On Fire
Submitted by Raul Ilargi Meijer via The Automatic Earth blog,

NPC US Geological Survey fire, F Street NW, Washington DC May 18 1913
I can do this in just about random order, the idea should still shine through, and crystal clear at that. We’re on the verge not of a market correction, but of something much bigger. All it takes to know that is to connect a few dots. Ironically, the very same financial press that reports on the dots, refuses to connect them. Don’t they see it, or don’t they want to? It’s not even a very interesting question anymore: they’ll end up commenting only in hindsight.
What happens today in Japan is both a sign of what’s wrong with the entire global financial system, and at the same time the catalyst that will help bring that system to its knees. Japan goes where no man has gone before, because it’s further down the gutter than the rest. But they will all follow. Japan thinks it can escape collapse if the US does fine, and vice versa, and the same goes for China, Europe etc., but none of them can survive the big blow by themselves, let alone that one of them could lift any of the others up by the hair on their heads. It’s a desperate mirage. When you hear anyone say the US will lift up the world economy, switch your channel. Unless you’re already at Comedy Central.
Here’s the litany for the day: China prints $25 trillion and buys Portugal. Japan’s national debt is 750% of tax revenue. US first time homebuyers are at a 27 year low. 40.5% of Greek children grow up in poverty, as Greece is part of the eurozone that should take care of all citizens. In the UK 72% of 18-21-year olds make less than a living wage. US and Japanese QE leads to ‘consumers’ spending less, which is the exact opposite of what QE is supposed to be intended for. China is trapped in the newfangled currency war Japan’s QE has unleashed across Asia, and which will soon be exported across the globe.
The common denominator? Debt. Sovereign debt, personal debt, corporate debt. Japan doesn’t want to recognize it yet, but it’s caught in the same trap with everyone. The difference is that Japan fights debt with more debt, while other parties are starting to find a little more nuance in their approach. Does it matter? Not one bit. Other than Japan’s hole will be deeper than the others. Let’s just track through today’s news. Bloomberg:
Portugal Sees Chinese Do 90% of Bids at Property Auction
As bargain-hunters waited in a packed room at a property auction in Lisbon last month, one language dominated their chat: Mandarin. About 90% of the bidders for the government-owned apartments and stores on offer were Chinese, according to Jorge Oliveira, the official overseeing the asset sale. They ended up acquiring more than two-thirds of the 45 properties, he said. “A Portuguese investor bought a store to start a bakery and coffee shop, but most of the properties went to the Chinese,” Oliveira said in an interview after the sale. Portugal is the latest target for Chinese investors who have been acquiring buildings around the world as China allows freer movement of funds in and out of the country.
Why would you want to sell your assets to a country that simply prints the money it uses to purchase those assets? Why not print that kind of money yourself and buy theirs? China printed $25 trillion and we allow them to buy Lisbon and Madrid and Rome with that? How much worse can this get? Portugal is defenseless, because it’s adopted the euro, but Germany would never allow the Chinese money printers to buy Berlin. Need any more info on why the eurozone is such an abject and perverse failure? Guardian:
More Than One Fifth Of UK Workers Earn Less Than Living Wage
More than a fifth of UK workers earn less than the living wage, with bar staff and shop assistants among the most likely to live “hand to mouth” because of low pay, a report warns on Monday. Published to mark living wage week, the research also finds that younger workers, women and part-timers are more likely to be paid less than the living wage, a voluntary threshold calculated to provide a basic but decent standard of living. New living wage rates will be announced on Monday, with the current rate at £8.80 per hour in London and £7.65 elsewhere. The report by consultancy firm KPMG adds to evidence of low pay remaining prevalent in Britain, despite the economic recovery. The proportion of employees on less than the living wage is now 22%, up from 21% last year, the study found. In real terms, that was a rise of 147,000 people to 5.28 million. [..] It found 72% of 18-21 year olds were earning less than the living wage
22% of your working population on less than a living wage is an insane disgrace. Certainly when at the same time you’re telling everyone your economy is doing great. There’s no excuse for that. But it can get worse: if 72% of your young people can’t survive on what they work for, you’re murdering your nation’s future. And your housing market, just to name an example, people can’t start families, it all ties together. MarketWatch:
US Consumers Resisting Enticements To Increase Spending
The U.S. is adding jobs at the fastest rate since the end of the Great Recession and another strong month of hiring is expected in October, but Americans still aren’t spending like good times are here to stay. The lackluster pace of consumer spending — outlays fell in September for the first time in eight months – largely explains why the U.S. is only growing at a post-recession annual average of 2.2%. Yet most economists think that could change in the near future.
The US is adding jobs that don’t pay enough to get people spending who are still buried in debt, just like Europe, just like Japan. That clear enough? The US economy ‘grows’ despite the American people. But ‘most economists think that could change in the near future’. Get a job. CNBC:
Bank of Japan Bazooka To Spark Currency War
The Bank of Japan’s (BoJ) stimulus blitz raises the specter of currency wars as a rapidly weakening yen threatens the competitiveness of export-driven economies, say strategists. “Whenever you have these kinds of disruptive moves by central banks, there’s always going to be fall out effects,” said Boris Schlossberg at BK Asset Management. Markets were caught off guard by the BoJ’s announcement on Friday that it would expand purchases of exchange-traded funds (ETFs) and real estate investment trusts, extend the duration of its portfolio of Japanese government bonds (JGBs), and increase the pace of monetary base expansion.
“The hottest currency war today is Japan vs Korea. That’s probably the one to keep an eye on. The yen-won cross rate is very sensitive as Japan and Korea compete in a lot of key areas,” said Sean Callow at Westpac. The Japanese currency has fallen around 20% against the won since the BoJ launched its unprecedented stimulus program in April 2013. Currency strategists say the BoJ’s actions could encourage the Bank of Korea (BoK) to become more defensive against local currency strength through intervention in the foreign exchange market or a rate cut.
That’s the big one for now. It’s not just Japan and Korea, Thailand, Indonesia, Vietnam and quite a few others are in the same merry go round. And of course China, as the following MarketWatch piece identifies: “The move will be particularly problematic for China, as its slow-crawling managed rate to the U.S. dollar renders it is effectively defenseless when confronted by currency wars.”
China Faces Trap In Currency War
Last Friday, the Bank of Japan effectively tossed a grenade into the region’s currency markets with its surprise announcement of a new round of quantitative easing sending the yen to fresh lows. The move will be particularly problematic for China, as its slow-crawling managed rate to the U.S. dollar renders it is effectively defenseless when confronted by currency wars, in which countries try to steal growth from their trading partners through competitive devaluations. It also comes at a time when Beijing is already battling foes on two fronts: hot-money outflows and an economy flirting with deflation. The consensus is that the world’s largest trading nation will resist the temptation to enter the fray with a competitive devaluation or move to a market-based exchange rate. Yet Japan’s latest actions will hurt, as they hold Beijing’s feet to the fire.
As long as China holds its (semi) peg to the USD, it may wake up to some ugly surprises, certainly when USDJPY goes to 120 or beyond. But the, when that happens, China won’t be alone. The next piece by Pater Tenebrarum, h/t Durden, may be the best I’ve read on Japan‘s despair move on Friday:
The Experiment that Will Blow Up the World
In order to explain why the pursuit of Kuroda’s policy is edging ever closer to a catastrophic outcome, we have to delve a bit into the details of Japan’s monetary data. In spite of the BoJ’s “QE” reaching record highs, it mainly creates bank reserves and furthers carry trades. The economy sees no private credit growth so far. Commercial banks in Japan continue to shrink the stock of fiduciary media – this is to say, they are reducing outstanding credit, which makes more and more unbacked deposit money disappear. Hence, Japan’s money supply growth has recently declined to a mere 4.3% year-on-year.
“… the markets are pouncing on the yen because they are forward-looking: the BoJ is monetizing ever more government debt and this is expected to continue, because the public debtberg has become too large to be funded by any other means. In spite of the relatively low money supply growth this debt monetization has produced so far, it also creates the perverse situation that an ever greater portion of the government’s outstanding stock of debt consists actually of debt the government literally “owes to itself”.
Japan has debt levels that are unequalled not just in the world, but most likely in human history, and I’m not saying that to take anything away from the demise of Rome:

And then we get back home with the NAR and Lawrence Yun and all of its cheerleaders, who got their faces all full of mud and shit and sand, and will never admit to it. Zero Hedge:
Why Housing Is Dead: First-Time Buyers Collapse To 27-Year Lows
The Millennials (one of the biggest generations in US history) are just not getting with the status quo program. As we detailed previously, with lower credit scores, less disposable income, and a soaring number of people living with their parents; so it should be no surprise that The National Association of Realtors (NAR) today admitted that first-time homebuyers plunged to the lowest level in 27 years. The blame – of course – rather than low/no-growth fiscal policies, student debt servitude, and inequality-driving cheap-funding monetary policy, is price competition from ‘investors’ and too “stringent credit standards,” perfectly mirroring FHFA’s Mel Watt’s Einsteinian insanity desire to dramatically ease lending standards and slash minimum down-payments (as we noted previously). Perhaps NAR accidentally stumbles on the biggest reason no one is buying in their profiling: the typical first-time buyer was 31-years-old, while the typical repeat buyer was 53 – smack in the middle of the Millennial collapse.
We’ve been keeping the long lost idea of our long lost society alive by squeezing our own children wherever we can, and telling them that if they only work hard enough, they can be whoever they want to be. But they can’t, that notion is also long lost. When you keep home prices artificially high, homeowners don’t suffer as much, even if they bought at insanely high prices, but the suffering is switched to potential buyers, who remain just that, potential, while they live in their mom’s basements for years.
A surefire way to kill a society while everyone’s eagerly awaiting the growth that is just around the corner and will forever remain there. Take it from your kids. Take it from somewhere else in the world.
And that’s where we’re now passing a barrier: there’s no-one to take it from anymore. Not through sleight of hand or spin or propaganda. You can only keep a quarter of your people below living wage levels for so long. Japan can only wage a currency war on its neighbors for so long (not very long). Japan can only wage a consumer price war on its own people for so long.
Japan’s QE9 has set the world on fire. It didn’t need much of a spark to begin with, but it’s certainly got one now.
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"It’s a desperate mirage."
Yup. And Central Bank printing is drinking sand.
There are worse places to get sand in.
Nowhere to take it from??? How about the Too Big To Fail bansksters? For starters..
Captain Walker, take us to tomorrow-morrow land!
https://www.youtube.com/watch?v=5fR1DO7Z3XQ
7 million upvotes for that @ "deeply indebted".
Or maybe a few billions upvotes. Do I hate banks? In the present era NO; hate is a strong word. But it has all lost it's way. People (billions) who work (produce) or try to work, keep losing ground and stability to ego-driven piles of unrecycled garbage who produce NOTHING but steal everything.
So hate? But yes. The BUCK STOPS HERE? I think that that is necessary. And I will not take any insanity pleas or "under the influence of drugs and hookers and hamptons pleas". This has got to end otherwise just about every soul on this planet is forfeit.
Interesting to see markets tomorrow, post-election. GOP may not take Senate without two runoff victories in December.
Gov Cuomo- "lazy" is "racist" code language:
http://tinyurl.com/kpfhazh
kuroda was heard singing:
Harry Truman, Doris Day, Red China, Johnnie Ray,
South Pacific, Walter Winchell, Joe DiMaggio,
Joe McCarthy, Richard Nixon, Studebaker, television
North Korea, South Korea, Marilyn Monroe.
Rosenbergs, H-bomb, Sugar Ray, Panmunjom
Brando, "The King and I" and "The Catcher in the Rye," Eisenhower, vaccine, England's got a new queen, Marciano, Liberace, Santayana goodbye!
We didn't start the fire,
It was always burning
Since the world's been turning.
We didn't start the fire,
No we didn't light it
But we tried to fight it.
Joseph Stalin, Malenkov, Nasser and Prokofiev
Rockefeller, Campanella, Communist Bloc,
Roy Cohn, Juan Peron, Toscanini, Dacron,
Dien Bien Phu falls, "Rock Around the Clock"
Einstein, James Dean, Brooklyn's got a winning team,
Davy Crockett, Peter Pan, Elvis Presley, Disneyland,
Bardot, Budapest, Alabama, Krushchev,
Princess Grace, "Peyton Place", trouble in the Suez.
We didn't start the fire,
It was always burning
Since the world's been turning.
We didn't start the fire,
No we didn't light it
But we tried to fight it.
Little Rock, Pasternak, Mickey Mantle, Kerouac,
Sputnik, Chou En-Lai, "Bridge on the River Kwai"
Lebanon, Charles de Gaulle, California baseball,
Starkweather homicide, children of thalidomide, Oh-oh-oh.
Buddy Holly, "Ben Hur", space monkey, Mafia,
Hula hoops, Castro, Edsel is a no-go,
U-2, Syngman Rhee, payola and Kennedy,
Chubby Checker, "Psycho", Belgians in the Congo.
We didn't start the fire,
It was always burning
Since the world's been turning.
We didn't start the fire,
No we didn't light it
But we tried to fight it.
Hemingway, Eichmann, "Stranger in a Strange Land"
Dylan, Berlin, Bay of Pigs invasion,
"Lawrence of Arabia", British Beatlemania,
Ole Miss, John Glenn, Liston beats Patterson,
Pope Paul, Malcolm X, British politician sex,
JFK, blown away, what else do I have to say?
We didn't start the fire,
It was always burning
Since the world's been turning.
We didn't start the fire,
No we didn't light it
But we tried to fight it.
Birth control, Ho Chi Minh, Richard Nixon back again,
Moonshot, Woodstock, Watergate, punk rock,
Begin, Reagan, Palestine, terror on the airline,
Ayatollah's in Iran, Russians in Afghanistan,
"Wheel of Fortune", Sally Ride, heavy metal suicide,
Foreign debts, homeless vets, AIDS, crack, Bernie Goetz, Hypodermics on the shore, China's under martial law, Rock and roller cola wars, I can't take it anymore.
We didn't start the fire,
It was always burning
Since the world's been turning.
We didn't start the fire,
But when we are gone
It will still burn on, and on, and on, and on.
We didn't start the fire,
It was always burning
Since the world's been turning.
We didn't start the fire,
No we didn't light it
But we tried to fight it.
We didn't start the fire,
It was always burning
Since the world's been turning.
We didn't start the fire...
This guy is coming out with some great pieces lately, excellent read.
It wont stop them from trying
After the Chinese buy up Portugal or Europe for that matter with their printed fiat, will they be able to take claim once it's all said and done.....I think not....War is coming
They still have quite a few US dollars to spend as well. I am not sure why they are still holding on to them. I know I would not be.
When Portugal goes back to the Escudo, which is inevitable, we shall see who has the last laugh. Perhaps these Chinese think these properties will always be convertible back to Euros. I doubt it.
In the meant time, I believe Portugal has a visa available to large foreign investors. This may explain the sudden interest from Chinese investors. I have decided to pass on this "opportunity".
The Portuguese Republic (in its current incarnation) is just 40 years old (dated from the end of Salazar). Salazar lasted less than 50 years; the first Republic not even 25 and even the Bragancas only lasted 85 years from their restoration after Napoleon.
This latest Chinese bet looks like an underlay to me and can only be explained by high prices and tougher visa criteria in Vancouver.
Ohhhhhh I disagree, the "taking" is only begun!
But what will be different in this new era of taking, will be the taking now will be violent and ruthless and without mercy or regard, while the taking of the last 30 years, has been soft, subtle, and even magician like with its ease!
Yes - you're right. This fiat system is doomed and it will do down guns blazing, literally.
Agreed, and it begins tomorrow. Did you know that the FEMA ebola camps will be staffed by all the alphabet-soup agencies EXCEPT CDC and NIH? Strange days....
I think you wish away/underestimate how long the mirage and bullshite can be carried on. Violence needs to be introduced gently (like the Supreme Court "Corps are people";,,,like the Executive Orders making POTUS a manipulated king...like the total corruption of funding for any possible good critical thinking public education system, Like all the back-door, secret room trade deals, like denial of voter rights,) All that and more was gently imposed.
Now You "folks" have a mid-term election that cost more money than the GDP of some small nations....an election where voters were systematically denied the right to vote in order to skew the ballots, an election that the turn-outs will be LOW. SUCH AN EXCEPTIONAL NATION YOU ARE.
I think (SARCASM FULL ON) this exceptional USA has so much to offer the world; to lecture others with. A model of democracy (just don't look to closely). The frigging vote in Crimea was more democratic than anything you can manage.
But that did not suit your goals did it?
Democracy in USA. What a friggin joke.
Japan has simply stolen a chapter out of the Fed's playbook. The Fed created money to 100% fund the treasuries deficit spending. When taxes from the asset bubble prices reduced the deficit, the Fed "tapered" and they tapered to slowly. Which, is precisesly why T-yields continued to tank after tapering was announced. The QE became to aggressive, and sucked all the liquidity out of the Treasury market. Now the govenrment is free to spend and issue new debt to restore liquidity. Japan is running the exact same play, counting on the same outcome.
Soon the Japanese Central bank will own all Japanese bonds. That will be the zenith of fake, incestuous economics that other central banksters will hope to emulate.
I think the point is moot. As of Halloween - they will own all the new issuance. If older bonds remain in the hands of the pension fund or a bank - it makes no difference. They're already inside the event horizon. They have no capacity to withstand even the smallest rise in interest rates. It's a death-spiral for the yen from here - there's no way out short of debt restructuring.
At some point they'll use a hail-mary in the form of debt-cancellation by the BOJ. They will simply declare the JGB's held by the BoJ void. It will be interesting to watch. One would think that for rational investors and savers, that would indicate that's the death of the yen, but history has counter-examples. Indeed - no rational investors would be buying 10-year sub-0.5% yen bonds anyway, so we're already way outside rational.
Finally, someone else said it. Own them all, thats nirvana. Then what? tear them all up, poof, Japan debt gone, like it never existed. What could be the outcome from that? Inflation due to the increased money supply. Thats exactly what the central banks want, inflation, to help inflate the rest of the debt away while pumping up the stock market along the way. And who said QE isn't working? This is exactly what QE was intended to do, all the stimulate the economy bullshit was just a deterent to appeace the masses.
A monetary system where all new money is created from loans(debt) at banks was bound to end this way.
But there are alternatives:
1) 1930s Chicago Plan
http://www.imf.org/external/pubs/ft/wp/2012/wp12202.pdf
2) Positive money (not debt money)
http://www.positivemoney.org/
"US Consumers Resisting Enticements To Increase Spending"
What, you guys don't like your fucking free towels?
Got a match?
So we have ever increasing misery, poverty and hopelessness for young people in the world's richest countries. Meanwhile the number of billionaires has doubled in the last 10 years.
A quick glance through history will show where this leads.
My feeling is that the match that lights the tinderbox will be when the big financial crash arrives and the people in power act instinctively to protect the wealthy while further hammering the rest.
Can't we all just get along ?
No, not when sociopathic neo Bolsheviks are in charge of the Fed, IMF, World Bank, and ECB. Japan and China are just doing what the civilized, freedom loving democracies are doing. Keeping up with the Jonesteins.
"The Millennials"
Of all the millennials I know personally. Not a ONE has yet to buy a house. They want houses, but even those with decent jobs are servicing student loan debt, have a car loan and spend too much on gadgets and entertainment. They love to go out to clubs, bars, and music events every weekend. Costly.
Add it up. They will never reach housing buying postions until 35+ years old!
Let them enjoy some before regretting the house. I mean ball and chain.
I know ONE who bought a house. He served one tour in Iraq living on a mega-base and loading trucks in more safety than somebody who lives in a major US city. Then he milked a head injury into a nice military disability payment, returned to the states and got his old fulltime job back as a returning "hero". Then he bought a small house in the lull before the latest faux housing "boom" got rolling.
In other words, the ONE millenial I know who owns a house scammed his way to it. Meanwhile the majority of the rest are living at home and toiling away at minimum wage or a couple bucks over minimum.
Shit, I'm a Gen Xr, and I couldn't afford to purchase a mortgage for a dwelling (see what I did there?) until I was 37.
Short sale. Less pain on the next downswing and all that (if I sell.)
Sorry, but your post is borderline insane.
"spend too much on gadgets and entertainment. They love to go out to clubs, bars, and music events every weekend. Costly."
First, all young generations usher in new "gadgets and entertainment". Old people don't. Old people still read newspapers for heaven's sake. Identify for me a generation of young people in the history of the world that did not act as all young people act.
I am truely growing tired of hearing how bad the Millenials are. That they are lazy, don't like to work, blah blah blah. Sure, there are some, maybe many, but no more or less than any prior generation. Oh and, lo and behold, it is not only in the US. How could it be that young people across the entire developed world are all lazy and don't like to work at the same time?
Younger generations are having a difficult time because their parents and grandparents of the Baby Boomer and Greatest generations ran up such large debts lavishing themselves in benefits without paying for them, that they have completly snuffed out any opportunity for youth in the impacted areas - namely US, Europe and Japan.
I have been saying that the next major war will be between generations and within borders. Yes, civil war. It should hopefully start through the political process. But, if adequate progress is not made, violence may very well be needed. The people in Spain, Greece, Japan, US, etc. can blame the EU, the ECB, the Fed, bankers, certain ethnic groups, if they want, but the blame lies within their borders and within each extended family.
It's all fake.
How many years is Japan from being a third world nation? I don't know the answer but its apparent that at this point in time its inevitable. No resources, again population, and a nuclear power grid that is on its last leg. With absolutely nothing to back their currency, its just a matter of time before Japan becomes a shell of what it is now.
Don't forget the highest proportion of seniors of any country in the world combined with the lowest birthrate in the world.
It's an economic disaster of epic proportions combined with a totol demographic meltdown.
I like what Willem Middlekoop states in his book, The Big Reset: "Fiat money systems have been put to the test more than 200 times, and they have all failed in the end. The likelihood of failure should now be considered a statistical certainty rather than a theoretical improbability."
Japan is just helping to speed up the endgame.
http://olduvai.ca
I am mazed that the yen even has an exchange rate.
Why doesnt Gov-Co - or the NWO or whatever you want to call it - simply round up and execute anyone under 40?
MISSION ACCOMPLISHED !
grrr. living wage is so annoying.
"Why would you want to sell your assets to a country that simply prints the money it uses to purchase those assets? Why not print that kind of money yourself and buy theirs? China printed $25 trillion and we allow them to buy Lisbon and Madrid and Rome with that? How much worse can this get?"
For the same reason China sells the U.S. manufactured goods, in exchange for - what again...?
When do we get to the part where the nation with the most (proven & verfiable) gold holdings comes out of hiding to push the reset button? Will that be before or after a Nimitz-class aircraft carrier is sunk in the East China sea by a P-270 variant...?
There are only two things you need to know:
HIGH PRICED OIL DESTROYS GROWTH
According to the OECD Economics Department and the International Monetary Fund Research Department, a sustained $10 per barrel increase in oil prices from $25 to $35 would result in the OECD as a whole losing 0.4% of GDP in the first and second years of higher prices. http://www.iea.org/textbase/npsum/high_oil04sum.pdf
THE PERFECT STORM (see p. 59 onwards)
The economy is a surplus energy equation, not a monetary one, and growth in output (and in the global population) since the Industrial Revolution has resulted from the harnessing of ever-greater quantities of energy. But the critical relationship between energy production and the energy cost of extraction is now deteriorating so rapidly that the economy as we have known it for more than two centuries is beginning to unravel. http://ftalphaville.ft.com/files/2013/01/Perfect-Storm-LR.pdf
An American born in 1945 can expect nearly $2.2m in lifetime net transfers from the "state" far more than they pay in, and far more than any previous group. A study by the International Monetary Fund in 2011 compared the tax bills of what different age citizens pay over their lifetime with the value of the benefits that they are forecast to receive.
To put this all in perspective remember if someone works for forty years earning an average of $25,000 over their life they earn only one million dollars. The boomers are leaving a huge bill. Those aged 65 in 2010 may receive $333 billion more in benefits than they pay in taxes.This is a heavy burden to place upon the young. The article below delves deeper into this subject.
http://brucewilds.blogspot.com/2013/03/the-young-will-be-burdened.html
Peanuts. The MIC spends twice that each year.
Good article that identifies straightforward correct facts.
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Debt pulls economic activity from the future to today, until eventually there is no future left.
There you go. That's what has happened. Nearly every individual, corporation and government feasted today and yesterday by stealing from tomorrow.
Well, tomorrow has arrived, and everyone who lived beyond their means has to pay back loans rather than buy goods and goodies. They already bought those goods and goodies in the past with the money they borrowed. Now the future has arrived, and there is no way to make the present better (for the 90-some percent of individuals and 99-ish percent of governments who borrowed like drunken sailors).
-----
But... the real situation is much worse. The glut of low-interest rate mortgages combined with low-to-zero down payments for many years has sent the price of homes into the stratosphere. They came down some since the crash of 2008, but they're still insanely high.
And what is the consequence of that... beside getting 90-some percent deep into debt? Answer: The prices of the largest expense for every individual have been driven sky high. So anyone foolish enough to buy a home must pay 2x, 3x, 4x, 5x more than the home would cost absent the insane debt mania of the past 15+ years. Which means, everyone who buys a home has most of the income immediately re-directed to the banks they got their home mortgages from, and have very little left over to spend for everything else. And that everything else IS the economy. But even those who rent are in not a much better situation, as rents rise to keep pace with home prices, even if slightly delayed.
And so... until the entire house of cards is allowed to collapse, young folks are screwed (because homes are too expensive and the job market sucks), old folks are screwed (because they can't get any interest on their life savings). And the multi-millionaire banksters become billionaire banksters as they borrow money at zero interest rate and buy financial assets on margin that are manipulated forever upward.
As long as central banks and fiat money exists... humans are screwed. Totally screwed. Simple logic and history agree... when you create a debt-oriented world, people can party until the wee hours of the morning and enjoy the goods and goodies they never earned, but could buy with borrowed fiat that nobody had to earn, and did not require production... until most everyone is deep in debt, homes are grossly overpriced, and the entire future has already been shifted into the past and present, and no future exists. Not even tomorrow.
The cliff is just ahead. Exactly how far is difficult to tell, but not far.