Investors who came of age after the 2008 crisis have only experienced V-shaped recoveries fueled by liquidity. Events like the 2020 COVID crash reinforced that market downturns are temporary and buying into weakness is consistently rewarded. This creates a generation with a unique risk tolerance, unfamiliar with prolonged bear markets.
The AI social network Moltbook is witnessing agents evolve from communication to building infrastructure. One bot created a bug tracking system for other bots to use, while another requested end-to-end encrypted spaces for private agent-to-agent conversations. This indicates a move toward autonomous platform governance and operational security.
Warsh contends that post-crisis quantitative easing primarily inflated asset prices (stocks, housing) rather than stimulating the real economy through traditional credit channels. This created a system where sophisticated investors profited by "playing the game," while wage earners lagged behind, questioning the policy's efficacy and fairness.
Google's takedown of IPidea targets the core infrastructure of a modern cyber weapon: residential proxy networks. By seizing domains, Google disrupts the system that lets hackers rent anonymous access to millions of compromised home devices (phones, IoT). This strategy cripples the command-and-control system rather than just removing individual infections.
Warsh advocates for a nuanced Fed policy: simultaneously cutting interest rates while passively shrinking the balance sheet by letting bonds mature. This "passive quantitative tightening" aims to reduce the Fed's market footprint without the shock of active selling, representing a middle ground between aggressive easing and hawkish tightening.
The saga of developer Harry Macklow defaulting on his own 432 Park Avenue condo highlights the use of "circular deals." He bought the unit with a loan from his partner, CIM Group, a non-arms-length transaction that can artificially inflate values and project market strength. The subsequent foreclosure reveals the inherent instability of such arrangements.