We now come to a discussion of the clay. Clay represents Man; more specifically, men who are moldable by the potter because the clay is miry. These are men who follow God, not men. Their ruler is Yahweh, not men. Men living within the Kingdom of Yahweh, not in the Kingdom of Babylon (kingdom of men).
There was no clay in the gold or the silver or the bronze or the iron legs. Man had not yet "come out of" Babylon. In the upper 95% of the image, men believed (had faith in) the rule of men and followed / obeyed them.
I propose that men have yet to identify the fraud called Babylon, so can't come out of her. The whole world still "wonders after the beast" and gives its allegiance to Babylon, the government of men, generally and Rome (Rome/U.S. and 10 toes of iron) specifically.
Not until God's people recognize the fraud of being ruled by men under the power of the dragon, can or will they come out of Babylon.
Not until that happens will the miry clay separate from the Roman iron. Not until that happens will we advance from the iron legs to the feet of iron and clay. We are still stuck in the legs of iron.
For a study on clay representing God's people, see...
Man of Dust or Clay
and see
The 10 Toes of Daniel 2