ONE ECONOMY TO RULE THEM ALL:

Four years ago, Comedian Louis C.K. observed that "everything is amazing but nobody is happy". This is a fitting description for the US in 2021: households' net worth has increased $31 trillion since March 2020. An additional 1.5 million workers retired early thanks to soaring asset prices. As I explained in the F.I.R.E economy, engineers at big tech companies have amassed multi-million fortunes simply by showing up for the job. And yet, the University of Michigan Current Economic Conditions index is at the same level it was in March 2020, at the worst of the pandemic and after a brutal bear market.

The first part will show that all the major sectors of the economy are experiencing an unprecedented windfall. Personal income tax collections have soared by 18% this year and gig income is doubling every two years. The household sector purchased a record $1.2 trillion in stocks in the second quarter and $3.2 trillion since March 2020.

Junk-rated corporations get to borrow at negative real yields when nominal GDP is growing by close to 10%, the fastest growth since the Reagan economic boom. Analysts keep increasing their EPS expectations.

Pension funds are fully funded for the first time in 15 years and tax collections in California have soared so much that even Sacramento politicians cannot spend the money fast enough.

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