A strange countdown, you must admit. But nay, it is Federal Reserve algebra.

In January of this year, Le Figaro published an article entitled “In 2016 Not a Single Cloud on the Horizon.” Journalists too, it seems, have strange ways of calculating.

Yesterday, Federal Reserve Board Chair Janet Yellen was supposed to raise the Fed’s interest rates. She did not do it, of course. I say, “of course,” but this was not obvious to everyone.

Why?

Because she cannot!

Yellen, similar to her predecessor, did not see the 2008 tidal wave coming, or did not want to see it coming. No clouds on the horizon.

For a few years now, finance has dwelled on an illusion. The illusion that growth is infinite, that central banks have supernatural powers, that penal sanctions can never be eschewed, and that Yellen is smarter than the rest of the world.

Unfortunately, these are no more than illusions.

Yellen wanted to nurture this illusion—willfully, for those who credit her with an IQ; unwittingly, for the others. If it comforts some to think that our economic policymakers know how to pilot but will purposefully crash, I concede this small consolation. Anyway, the outcome is the same.

Thus, this strange countdown: four raises were announced this year, then two and finally one. In fact, there will be zero. It is even more likely that Yellen will have to lower interest rates once again, subsequently resulting in quantitative easing, also known as QE.

In December 2015, Yellen raised interest rates by a quarter of a percentage point out of fear over a credibility crisis from financial players who might end up realizing that U.S. growth is not what the mainstream narrative had led them to believe. Therefore, she announced four raises for 2016. After consecutive bad macroeconomic figures and dire global corporate earnings, the anticipated raises went down to two, and then yesterday to one.

So, is this the end of the realm of illusions?

Not right now. A drug addict does not get clean so easily! The U.S. bond market indicates that we are in a recession. With 10-year bonds at 1.5 percent, and inflation slightly above 2 percent, the gross domestic product must be negative 0.5 percent to 0.7 percent, and all of this in spite of a phenomenal increase in total debt. In the first quarter of 2016, it reached $650 billion (including government, household and corporate debt). This explains why Yellen fidgeted in her seat while she told her stories on Wednesday night.

Is it worrying for the markets?

No, the markets worry about whether there will be fuel, and not whether there is a pilot on the plane! Worse, when the question finally hits, the plane will have already crashed.

I always come back to the same example, since it is a textbook case.

In Japan, with a QE of 12, a debt-to-GDP ratio of 240 percent, and a fiscal deficit of 7 to 10 percent a year, there have been catastrophic results. The inversion of the yields curve—10 years ago, less than seven, five and three years ago—indicates Japan’s fall back into recession. Prime Minister Abe and Governor of the Bank of Japan Kuroda displayed genuine and uncharacteristic panic in their latest speeches. They are likely to radically increase QE in a last desperate move before the total collapse of Japan.

Meanwhile, the yen rises while it is not even worth the price of the paper it is printed on. The landing will be radical!

Now that the last financial players understand that they are witnessing the end of the show, what are the scenarios?

Short term U.S. bonds increase, the dollar decreases, U.S. shares decline, soon the yen and the Japanese bond and share markets will collapse, followed by the plummeting of the euro markets.

Mid-to-long term, the collapse of the system could go as far as a global market freeze. The monetary system as we know it today will disappear. The only assets we will not stop needing will be the real assets: gold, silver, platinum, palladium, precious stones, copper, nickel, rare earth minerals … all in their physical state versions, obviously.

If, while perusing this article, you judge that I go too far, or that I'm plainly wrong, I invite you to reread our articles and/or re-examine our videos that we have published regularly for the last year that the group has existed. You will realize that we have been constantly right in our economic forecasts, even though it took longer than we expected for the people to finally grasp reality. But the game is too important to just worry about timing.

I wish you all a great holiday.