Since 2009, as policy makers have sought to return the global economy to normal, "stability" has usually been their byword. Unfortunately, their actions have only created a false calm -- a "stable instability," to coin a paradoxical phrase. Although a repeat of the financial crisis has so far been avoided, this relative tranquility has had the effect of derailing normal market mechanisms, thereby masking a worrisome accumulation of risks.
Stable instability creates the illusion of normality, obscuring dangers hidden behind the apparently stationary and familiar. It's analogous to a person who shows no obvious symptoms of an as-yet-undetected terminal disease. In this state, the same arguments can be used to rationalize contradictory events and different arguments used to reconcile identical facts.
