That blog title was an attempt to summarize the state of global economy today.

The global economy, for a while, is running on a single engine ; that is of US and UK. Euro zone is still struggling and one financial shock away from recession. Japan is  running out of fuel after an year of fiscal and monetary stimulus. Emerging markets’ growth rates have dropped sharply in the last few years.

It is not clear how long the global economy could fly on one engine.

The link between macro news, policy response and reaction from financial markets seems to have broken. Bad macro news is not leading to predictable policy responses. Financial markets are trying to second guess how the central banks or government will shape policy.

But the political will to take strong policy decisions has withered away with rising debt levels and alarming inequalities. The backlash against inequality could eventually add another bout of turbulence; policy inertia, or worse, bad policy decisions.

Now the pilots themselves – read politicians and central banks – seem to be polarized and paralyzed in their response to economic rough weathers. While the Fed ended QE program officially, there is no confirmation that it will stick to its stand. Meanwhile Japan started its own QE experiment, surprising markets.

The response of developed countries to their economic troubles, shows that monetary policy among the central banks of developed economies has decoupled from one another. But one thing appears to be common. Central banks are owning more and more of their government’s debt, offered at low or zero interest rates. Governments are addicted to that cheap debt.

We have a situation today without a precedent; one part of government owes a lot of money to another part of it. The day someone decides to cancel each other out, we will have a case of default.