Readers occasionally point out I've been predicting that unsustainable extremes will eventually unravel for 10+ years, yet everything's still fine. Yes, everything's still fine, maybe even peachy, but perhaps we should describe "fine" in light of the policy extremes that keep getting more extreme to keep all that fineness duct-taped together.

How about this for FINE:

Fragile

Insecure

Nonsensical

Expensive

To assess just how extreme things have become beneath the placid surface of peachiness, let's look at federal debt, the Fed balance sheet and Household Net Worth in relation to inflation and GDP, two standard measures of growth.

All else being equal, most economic-financial metrics will roughly track either inflation or Gross Domestic Product (GDP), the broad measure of the economy's activity / expansion /contraction.

In other words, one way to identify extremes is to look for metrics that are way out of line with GDP and inflation. Consider federal debt as an example. We can be forgiven for assuming federal borrowing would more or less track the expansion of GDP.

But as the chart below shows, if federal debt had tracked GDP since 1990, it would be around $16 trillion, half of its current bloat of $32 trillion. Hmm, $16 trillion here, $16 trillion there and pretty soon you're talking real money.