Wednesday , December 11 2019
Home / Charles Hugh Smith
Charles Hugh Smith

Charles Hugh Smith

At readers' request, I've prepared a biography. I am not confident this is the right length or has the desired information; the whole project veers uncomfortably close to PR. On the other hand, who wants to read a boring bio? I am reminded of the "Peanuts" comic character Lucy, who once issued this terse biographical summary: "A man was born, he lived, he died." All undoubtedly true, but somewhat lacking in narrative.

Articles by Charles Hugh Smith

The Taxonomy of Collapse

1 day ago

The higher up the wealth-power pyramid the observer is, the more prone they are to a magical-thinking belief that the empire is forever, even as it is crumbling around them.
How great nations and empires arise, mature, decay and collapse has long been of interest for a self-evident reason: if we can discern a template or process, we can predict when the great nations and empires of today will slide into the dustbin of history.
One of the justly famous attempts to lay out the stages of expansion, zenith, decline and collapse is Sir John Glubb’s 1978 The Fate of Empires. Succinct and deeply informed, Glubb’s essay lists these stages:
The Age of Pioneers (outburst or Boost Phase)
The Age of Conquests
The Age of Commerce
The Age of Affluence
The Age of Intellect

Read More »

Costs Are Spiraling Out of Control

5 days ago

And how do we pay for these spiraling out of control costs? By borrowing more, of course.
If we had to choose one “big picture” reason why the vast majority of households are losing ground, it would be: the costs of essentials are spiraling out of control. I’ve often covered the dynamics of stagnating income for the bottom 90%, and real-world inflation, i.e. a decline in purchasing power.
But neither of these dynamics fully describes the relentless upward spiral of the cost basis of our economy, that is, the cost of big-ticket essentials: housing, education and healthcare.
The costs of education are spiraling out of control, stripping households of income as an entire generation is transformed into debt-serfs by student loan debt.

Wages aren’t keeping up –

Read More »

Crunchtime: When Events Outrun Plan B

7 days ago

Not only will events outrun Plan B, they’ll also outrun Plans C and D.
We all know what Plan B is: our pre-planned response to the emergence of risk. Plan B is for risks that can be anticipated, regular but unpredictable events such tornadoes, earthquakes, hurricanes, etc. In the human sphere, risks that can be anticipated include temporary loss of a job, stock market down turns, recession, disruption of energy supplies, etc.
Hidden in most Plan B’s are a host of assumptions that all the systems running in the background pf the economy will remain stable. Even if electrical and cell-phone service go down, for example, we assume the outage will be temporary. We assume delivery of energy and food will resume shortly, we assume medical care will be available

Read More »

Could America Survive a Truth Commission?

9 days ago

A nation that’s no longer capable of naming names and reporting what actually happened richly deserves an economic and political collapse to match its moral collapse.
You’ve probably heard of the Truth Commissions held in disastrously corrupt and oppressive regimes after the sociopath/kleptocrat Oligarchs are deposed. The goal is not revenge, as well-deserved as that might be; the goal is national reconciliation via the only possible path to healing: name names and tell the plain, unadorned truth, stripped of self-serving artifice, spin, propaganda and PR.
Is such a stripped-of-spin truthful account of names and events even possible in the U.S.? Sadly, there is precious little evidence that a Truth Commission in the U.S. would be anything more than a travesty of a

Read More »

A China Trade Deal Just Finalizes the Divorce

10 days ago

Each party will continue to extract whatever benefits they can from the other, but the leaving is already well underway.
Beneath the euphoric hoopla of a trade deal with China is the cold reality that the divorce has already happened and any trade deal just signs the decree. The divorce of China and the U.S. was mutual; each had used up whatever benefits the tense marriage had offered, and each is looking forward to no longer being dependent on the other.
Any trade deal is like closing the barn door months after the horses left. Corporate America’s supply chains are already leaving China for lower cost, friendlier countries, and for its part China has already made its intentions to escape the grip of the U.S. dollar abundantly clear.
Indeed, China has clearly

Read More »

We Can Only Choose One: Our National Economy or Globalization

13 days ago

The servitude of society to a globalized economy is generating extremes of insecurity, powerlessness and inequality.
Does our economy serve our society, or does our society serve our economy, and by extension, those few who extract most of the economic benefits? It’s a question worth asking, as beneath the political churn around the globe, the issues raised by this question are driving the frustration and anger that’s manifesting in social and political disorder.
A recent essay examines these issues in light of Brexit, which the author sees as a manifestation of dramatic but poorly understood changes in Britain’s economy over the past 60 years:
How Britain was sold: Why we need to rethink the case for a national capitalism in the age of uncertainty.
“One of the

Read More »

Darn, This Is Inconvenient: Apple Is Destroying the Planet to Maximize Profits

16 days ago

Stripmining the planet to maximize profits isn’t progressive or renewable–it’s just exploitive and destructive.
How do we describe the finding that the planet’s most widely-owned super-corporation is destroying the planet to maximize its smartphone sales and profits? Shall we start with “inconvenient?” Yes, we’re talking about Apple, famous for coercing customers to upgrade their Apple phones and other gadgets if not annually then every couple years, as the most effective way to maximize profits.
Unfortunately, smartphones require stripmining the planet, as described in this report, Smartphones Are Killing The Planet Faster Than Anyone Expected Researchers are sounding the alarm after an analysis showed that buying a new smartphone consumes as much energy as

Read More »

What’s Been Normalized? Nothing Good or Positive

18 days ago

What’s been normalized are policies and cultural norms that seek to enrich and protect the few at the expense of the many.
When the initially extraordinary fades into the unremarkable background of everyday life, we say it’s been normalized. Put another way, we quickly habituate to new conditions, and rationalize our ready acceptance of what was previously unacceptable.
Technology offers many examples of extraordinary advances quickly becoming normalized as we habituate to new devices and behaviors, but my focus today is on policies and cultural norms that were radical departures from accepted norms at their introduction but which are now accepted as “normal.”
This normalization of extreme policies conceals the often equally extreme unintended consequences of

Read More »

Political and Social Conflict Is Accelerating: Here’s Why

21 days ago

All the status quo “fixes” only hasten the collapse of the status quo.
That economic, social and political conflict is accelerating is self-evident. What’s open to debate are the core drivers of conflict / disorder /unraveling.
Here’s the core self-reinforcing dynamic in my view:
1. The status quo elites can no longer mask soaring costs of essentials nor soaring wealth / income inequality between the top .01% (Oligarchs), the top 9.99% who enrich the Oligarchs with their discretionary spending and technocratic/managerial labor, and the bottom 90% who are rapidly losing ground on all fronts: economic, social and political.
2. The elites’ “fixes” to the social / political conflicts unleashed by the rigged financial system and winner take most economic order

Read More »

If Not-QE Is QE, then is Not-a-Blowoff-Top a Blowoff Top?

22 days ago

Can $300 billion, or $600 billion, or even $1 trillion continue to prop up an increasingly risk-riddled, fragile $330 trillion global bubble in overvalued assets?
When is “Not-QE” QE? When Federal Reserve Chairperson Jerome Powell declares QE is not QE. We can constructively recall the story that Abraham Lincoln famously recounted in 1862: ‘If I should call a sheep’s tail a leg, how many legs would it have?’
‘No, only four; for my calling the tail a leg would not make it so.’
Calling QE not-QE doesn’t make it different than QE, but it does communicate the Fed’s panicky desire to mask its stupendous injection of financial cocaine into the financial system. The Fed’s level of panic is noteworthy, as is the absurd transparency of its laughable attempt to conceal its

Read More »

Stock Market Cheerleading: Why Do We Celebrate the Super-Rich Getting Richer?

27 days ago

It’s not too difficult to predict a political rebellion against the machinery of soaring wealth and income inequality.
The one constant across the media-political spectrum is an unblinking focus on the stock market as a barometer of the national economy: every major media outlet from the New York Times to Fox News prominently displays stock market action, and TV news anchors’ expressions reflect the media’s emotional promotion of the market as the end all to be all: if stocks rose, the anchors are smiling and chirpy, and if the market fell then their expressions are downcast and dour.
This cheerleading of the stock market is based on an implicit assumption that the rising stock market raises all boats: a rising market is assumed to reflect an expansion of sales

Read More »

Now That We’ve Incentivized Sociopaths–Guess What Happens Next

28 days ago

As long as central banks create and distribute trillions in conscience-free credit to conscience-free financiers and corporations, the incentives for sociopathy only increase.
“Sociopath” is a word we now encounter regularly in the mainstream media, but what does it mean? Here is a list of 16 traits, many of which are visible in lionized corporate and political leaders and entrepreneurs.
One key trait is a lack of moral responsibility or conscience; the sociopath feels no remorse if he/she takes advantage of people or exploits them.
Sociopaths are masters of superficial charm, intelligence and confidence, and adept at massaging or misrepresenting reality up to and including outright lying to persuade others or get their way.
Like all psychological syndromes (manic

Read More »

The Middle Class Is Now The Muddle Class

November 5, 2019

The net result is the muddle class has the signifiers but not the wealth, power, capital or agency that once defined the middle class.
The first use of the phrase The Muddle Class appears to be The rise of the muddle classes (Becky Pugh, telegraph.co.uk) in January 2007. The “muddle” described the complex nature of defining “the middle class,” which includes education, class origins, accents, and many other financial, social and cultural signifiers.
Comedian Jason Manford claimed to have coined the term in June 2013: “I’ve invented a new term; ‘Muddle Class’.
When you find yourself being working class AND middle class at the same time.”
I’m using the term to describe the economic class that has the social signifiers of middle class status but little to no

Read More »

The Political Parties and the Media Have Abandoned the Working “Middle Class”

October 31, 2019

Where is the line between “working class” and “middle class”? Maybe there isn’t any.
Defining the “middle class” has devolved to a pundit parlor game, so let’s get real for a moment (if we dare): the “middle class” is no longer defined by the traditional metrics of income or job type (blue collar, white collar), but by an entirely different set of metrics:
1. Household indebtedness, i.e. how much of the income is devoted to debt service, and
2. How much of the household spending is funded by debt.
3. The ability of the household to set aside substantial savings / capital investment.
4. The security of the households’ employment.
5. The dependence of the household wealth on speculative asset bubbles inflated by central bank policies.
6. The percentage of the

Read More »

The Unraveling Quickens

October 24, 2019

Even if we don’t measure the erosion of intangible capital, the social and political consequences of this impoverishment are manifesting in all sorts of ways.
The central thesis of my new book Will You Be Richer or Poorer? is the financial “wealth” we’ve supposedly gained (or at least a few of us have gained) in the past 20 years has masked the unraveling of our intangible capital: the resilience of our economy, our social capital, i.e.
our ability to find common ground and solve real-world problems, our sense that the playing field, while not entirely level, is not two-tiered, and our sense of economic security–have all been shredded.
The unraveling of everything that actually matters is quickening. While every “news” outlet cheerleads the stock market (“The

Read More »

Prying Open the Overton Window

October 22, 2019

If you’re truly interested in finding solutions to humanity’s pressing problems, then start helping us pry open the Overton Window.
The Overton Window describes the spectrum of concepts, policies and approaches that can be publicly discussed without being ridiculed or marginalized as “too radical,” “unworkable,” “crazy,” etc. The narrower the Overton Window, the greater the impoverishment of public dialog and the fewer the solutions available.
Those holding power in a socio-economic-political system that’s unraveling devote their remaining energy to closing the Overton Window so that only “approved” narratives and policies that support the status quo are “allowed” into the public sphere.
Everything outside this narrow band of status-quo-supportive narratives is

Read More »

What We’ve Lost

October 21, 2019

This is only a partial list of what we’ve lost to globalism, cheap credit and the Tyranny of Price which generates the Landfill Economy.
A documentary on the decline of small farms and the rural economy in France highlights what we’ve lost in the decades-long rush to globalize and financialize everything on the planet— what we call Neoliberalism, the ideology of turning everything into a global market controlled by The Tyranny of Price and cheap credit issued to corporations and banks by central banks.
After Winter, Spring (2012) was made by an American who moved to a small village in the Dordogne region of France to recover something of her childhood on a small Pennsylvania farm.
The farmers–self-described as paysans, peasants in English, (a translation I don’t

Read More »

Welcome to the USSR: the United States of Suppression and Repression

October 19, 2019

We’re all against “fake news,” right? Until your content is deemed “fake news” in a “fake news” indictment without any evidence, trial or recourse.
When propaganda is cleverly engineered, people don’t even recognize it as propaganda: welcome to the USSR, the United States of Suppression and Repression. The propaganda in the U.S. has reached such a high state that the majority of people accept it as “pravda” (truth), even as their limbic system’s BS detector is sensing there is a great disturbance in the Force.
Inflation is a good example. The official (i.e. propaganda) inflation rate is increasingly detached from the real-world declines in the purchasing power of the bottom 80%, yet the jabbering talking heads on TV repeat the “low inflation” story with such

Read More »

Economic Decay Leads to Social and Political Decay

October 18, 2019

If we want to make real progress, we have to properly diagnose the structural sources of the rot that is spreading quickly into every nook and cranny of the society and culture.
It seems my rant yesterday (Let Me Know When It’s Over) upset a lot of people, many of whom felt I trivialized the differences between the parties and all the reforms that people believe will right wrongs and reduce suffering.
OK, I get it, there are differences, but if the “reform” doesn’t change the source of the suffering and injustice, it’s just window-dressing that makes the supporter feel virtuous. Want an example? Let’s take the the “cruel and unusual punishment” for drug-law offenders, many of whom are African-American males whose lives are effectively hobbled by felony convictions

Read More »

Let Me Know When It’s Over

October 16, 2019

Maybe it’s my cheap seat or my general exhaustion, but the whole staged spectacle is beyond tiresome; I’ve had my fill.
Let me me know when it’s over: yes, all of it: the impeachment, the trade dispute with China, U.S. involvement in Syria, the manic stock market rally and the 2020 election.
I’m not interested in following every twist and turn of the endless trauma-drama because none of it changes anything: Swapping Pence for Trump changes nothing, and then swapping Warren for Pence in 2020 doesn’t change anything, either: the rot is too deep for any one person to do much beyond feel-good virtue-signaling and symbolic gestures (tax the billionaires, etc.)
The entire political process has devolved to staged battles in the Bread and Circuses Coliseum, entertainment

Read More »

The Ultimate Heresy: Technology Can’t Fix What’s Broken

October 14, 2019

Technology can’t fix what’s broken, because what’s broken is our entire system..
The ultimate heresy in today’s world isn’t religious or political: it’s refusing to believe that technology can not only solve all our problems, it will do so painlessly and without any sacrifice. Anyone who dares to question this orthodoxy is instantly declared an anti-progress (gasp!) Luddite, i.e. a heretic in league with the Devil.
Even worse, if that’s possible, is declaring that technology is making our lives worse rather than better. There’s an entire industry devoted to cherry-picking data to support the One True Faith of Technology: a new miracle drug (never mind the side-effects or the fact that the drug only works on a relative handful of patients), a new energy source that

Read More »

Will the Clintons Destroy the Democratic Party?

October 11, 2019

History is full of ironies, and perhaps it will suit the irony gods for The Donald to take down the Republican Party and the Clinton dynasty to destroy the Democratic Party.
Let’s start by stipulating my bias: I would cheer the collapse of both self-serving, venal political parties, which have stood by for decades as the rich have become immeasurably richer and the politically powerful few have disempowered the many. The transparent “populist” bleatings of both parties–“we serve the people!”–sound increasingly like stale, pathetically disconnected from reality Soviet-era propaganda.
Let’s say I’m a relatively disinterested observer other than my fervent wish that both corrupt, self-serving parties slide into the dustbin of history, the sooner the better.
The

Read More »

Our Time/Labor Is Finite, But Money Is Infinite

October 10, 2019

Once we understand this mechanism, we understand that labor can never get ahead.
I’ve been pondering a comment longtime correspondent Drew P. emailed me in response to my post, What’s Holding Up the Market?: “Our time/labor is finite, but money is infinite.” Drew explained that creating new fiat currency and injecting it into a closed system (our financial system) controls and restrains the value of our time and labor, past, present and future.
This is a profound insight into why our financial system is inherently exploitive and why it is unsustainable.
As citizens of Venezuela and other nations have discovered, the power to create infinite sums of currency devalues the fruits of our labor in the past, present and future. As new currency is injected into a

Read More »

What’s Holding Up the Market?

October 8, 2019

The Fed’s nearly free money for financiers policies in support of the Super-Rich do not exist in a vacuum–the disastrous consequences are already baked in.
What’s holding up the U.S. stock market? The facile answer is the Federal Reserve (“the Fed has our back,” “don’t fight the Fed,” etc.) but this doesn’t actually describe the mechanisms in play or the consequences of a market that levitates ever higher on the promise of more Fed money-for-nothing injected into the diseased veins of the financial system.
As Gordon T.
Long and I discuss in our latest half-hour video program, What’s Holding the Market Up? (34 minutes), the primary prop under stock valuations are corporate buybacks, which total in the trillions of dollars since the 2008-09 Global Financial

Read More »

Could Pricey Urban Meccas become Crime-Ridden Ghost Towns?

October 1, 2019

As the exodus gathers momentum, all the reasons people clung so rabidly to urban meccas decay.
If there is any trend that’s viewed as permanent, it’s the enduring attraction of coastal urban meccas: despite the insane rents and housing costs, that’s where the jobs, the opportunities and the desirable urban culture are.
Nice, but like many other things the status quo considers permanent, this could reverse very quickly, and all those pricey urban meccas could become crime-ridden ghost towns. How could such a reversal occur?
1. Those in the top 10% who can leave reach an inflection point and decide to leave. The top 1% who live in enclaves filled with politicians, celebrities and the uber-wealthy see no reason to leave, as the police make sure no human feces land

Read More »

Pets Are Now as Unaffordable As College, Housing and Healthcare

September 28, 2019

Like so many other things that were once affordable, owning pets is increasingly pricey.
One of the few joys still available to the average household is a pet. At least this is what I thought until I read 5 money-saving tips people hate, which included the lifetime costs of caring for a pet.
It turns out Poochie and Kittie are as unaffordable as college, housing and healthcare (and pretty much everything else). Over the course of 15 years, small-dog Poochie will set the owner back an eye-watering $17,560 to $93,520, while big-dog Fido costs $22,025 to $82,929 over 12 years.
Kittie is a relative bargain at $16,800 over 15 years.
Some estimates of responsible pet ownership are considerably lower, but non-pet owners may be surprised by 1) how many options for the

Read More »

Here’s How We Are Silenced by Big Tech

September 27, 2019

This is how they silence us: your content has been secretly flagged as being “unsafe,” i.e. “guilty of anti-Soviet thoughts;” poof, you’re gone.
Big Tech claims it isn’t silencing skeptics, dissenters and critics of the status quo, but it is silencing us. Here’s how it’s done. Let’s start with Twitter. Twitter claims it doesn’t shadow ban (Setting the record straight on shadow banning), which it defines as deliberately making someone’s content undiscoverable to everyone except the person who posted it, unbeknownst to the original poster.
Nice, but what do we call labeling legitimate websites “unsafe” and banning Twitter users from retweeting links to posts on those sites? This is what’s happening to oftwominds.com– Twitter has labeled this site “unsafe” due to

Read More »

Financial Storm Clouds Gather

September 25, 2019

The price of this “solution”–the undermining of the financial system–will eventually be paid in full.
The financial storm clouds are gathering, and no, I’m not talking about impeachment or the Fed and repo troubles–I’m talking about much more serious structural issues, issues that cannot possibly be fixed within the existing financial system.
Yes, I’m talking about the cost structure of our society: earned income has stagnated while costs have soared, and households have filled the widening gap with debt they cannot afford to service once the long-delayed recession grabs the economy by the throat.

Everywhere we look, we find households, enterprises and local governments barely able to keep their heads above water–in the longest expansion in recent history. This

Read More »

Automation and the Crisis of Work

September 23, 2019

Technology, like natural selection, has no goal.
When it comes to the impact of automation (robots, AI, etc.) on jobs, there are two schools of thought: one holds that technology has always created more and better jobs than it destroys, and this will continue to be the case. The other holds that the current wave of automation will destroy far more jobs than it creates, but the solution is to tax the robots and use these revenues to distribute the wealth to everyone who no longer has a livelihood.
In either case, we’ll get richer: if technology generates more high-quality jobs, replacing lower-quality jobs lost to automation, we’ll collectively get richer, and if technology destroys jobs but creates immense profits that can be distributed to everyone as Universal

Read More »

The New Orthodoxy: Blasphemy, Heresy and the New Inquisition

September 20, 2019

A corrupt Orthodoxy devoid of new ideas, an Orthodoxy devoted to maintaining the wealth, status and power of insiders regardless of cost, is a brittle, fragile, unstable system.
When the ruling Elites sense their control of the populace is waning, they seek to regain full control via the imposition of a strict Orthodoxy, enforced by an Inquisition. We are living in just such an era. Everywhere we turn, a New Orthodoxy reigns. Dissent is blasphemy, and any narratives outside the approved Orthodoxy are heretical and subject to suppression and punishment.
New Orthodoxies abound, and woe to those who fail to signal their virtue publicly. One New Orthodoxy is that one’s sexual and ethnic characteristics are all-important signifiers of identity. This orthodoxy is

Read More »