Guest Post: 2011 Tipping Points

Tyler Durden's picture

By Gordon T. Long of Tipping Points

2011 Tipping Points (pdf)

Throughout my 2010 article series "Extend & Pretend" and "Sultans of Swap" I stressed that we were rapidly moving from the Financial Crisis of 2008, through the Economic Fallout of 2009 -2010, towards a Political Crisis in 2011 -2012. We are now clearly beginning to see the early emergence of the final part of this continuum.  From North Africa to Wisconsin all are fundamentally based on the single insidious underlying problem - excessive global debt and credit levels.

The global macroeconomic environment appears to be rapidly unraveling. The situations in North Africa through the Middle East are blatant proof of social unrest and accelerating political instability. Food shortages and inflation pressures are now driving people into the streets. When you feel the hunger in your stomach and see it in the eyes of your children, it quickly erupts and motivates people to action.
It is now time to revisit our Tipping Points framework to see where this is leading. A framework that is clearly pointing to a global fiat currency failure and an emerging new world order which is detailed in our "2011 Thesis - Beggar-thy-Neighbor".

Our Tipping Points which are outlined below are adjusted continuously based on daily news flow analysis.  Through a proprietary 'Process of Abstraction' news is tracked and consolidated around these potentially critical flash points.


INCREASES                                IS    WAS    CHANGE   

1) Oil Price Pressures                 14    30    +16
2) China Bubble                           9    22    +13   
3) Food Price Pressures               5    15    +10
4) Rising Inflation Pressures &
    Interest Rate Pressures            6    14   +  8
5) Geo-Political Event Risk                          New
6) Social Unrest                                         New


1) North & Southern Korea         30    12    -18
2) Financial Crisis Programs
    Expiration Impact                   34    24    -10

The Tectonic Shifts from 2007 to 2013 are best shown in the following illustration which is closely tracking our expectations and projections from the early stage of the financial crisis.


We need to carefully watch:

1) The increasing & accelerated contagion of social tensions. Watch for Asia demonstrations in places such as North Korea.
2) How and if the Central Banks actually do unwind their  crisis ‘triage’ programs or are they realistically now permanent and necessary to maintain the illusion of financial stability?
3) New government public policy initiatives to combat growing inflation and price pressures
4) The financial sectors abilities to continue to hide massive nonperforming commercial and residential real estate loans through Federal Reserve endorsed accounting gimmickry.

These events will allow us to determine if our roadmap is still valid or if we are going to see even sooner and possibly poorer financial outcomes than we predict in our free Monthly Market Commentary and Market Analytics reports.

The public will soon wake up to the magnitude of money printing that is going on to support the economic recovery fallacy. When the public does become aware, “Money Velocity” will accelerate. When this happens, the likelihood is that the markets will dramatically rise, not because economic conditions are improving, but rather because of a depreciating US dollar.  We believe this expectation is presently being priced into the market. We are truly exposed to the potential of a “Minsky Melt-Up” or more correctly from an Austrian perspective, a Von Mises “Crack-up Boom”. 

The risks are presently towards a SHORT TERM corrective consolidation. The Intermediate Term calls for higher market highs into June 2011 - then it gets ugly - fast!

“The Federal Reserve historically was the lender of last resort in a crisis;
Today, the Federal Reserve is the buyer of first resort in a crisis
..... and every day for that matter”

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zebra's picture

wishingful thinking. i like it.

Cleanclog's picture

Or, as Charlie Sheen would say, magical thinking.

asdasmos's picture

What about this exchange on CNBC today? (Feb 25th 2011)



or if you prefer the cnbc link.....



Damon Vickers, Nine Points Capital Management founder talks about QE2 and why he thinks bernanke is buying up the US debt

lynnybee's picture

yes, i saw that .   what a set - up !   conditioning the people to accept this one-world government & one-world currency . ...... biggest scam & rip-off in the history of the world.... i can't get out of this story !  

asdasmos's picture

IMO, the best part:


Carl:We issued ahh....30 billion in 7 year notes this morning and yields are down. I mean the vigilantes, we always say, if they are so worried, why are they hiding?

Damon: Who did we issue those to?

Car:      Whoever bought them.  I mean the point is supply came online and it was absorbed....

Damon: Who was that?

Carl: a week where risk was off.

Damon: Who bought those bonds?

Lady:   Who did buy it? Was it all the Fed? You think nobody bought?

Damon: Who bought those bonds?

Carl:    Could have been the Fed, could have been the chinese japanese.

Damon: I dont think so. I don't think sales are taking place. Thats why QE2 Exists. They are issuing debt and printing paper and printing money because there is not the absorbtive capacity of the world to absorb the debt, and thats where we are.



Strike Back's picture

Jesus Christ, I just realized that Carl is saying what most people people think.

LeBalance's picture


First reaction to a non-sale would be "ooo f!"

But they saw this coming, so they swept it under the rug as if Nooooothing is wrong.

Because if they said "This shit's broken!"  WTF happens next?

And the deadly question is: "In how many facets of existence are we already playing beyond the Event Horizon?"


financeguru500's picture

My personal favorite from the news today was Megyn Kelly on Fox telling everyone they should "Go ahead and fill up their cars today to save money before the prices rise."


Lol. That advice will help for all of about a week. What's your next advice? Stock up on groceries? Oh wait, if people do that they are considered conspiracy theorists and hoarders. Please Fox, tell me what I need to do.



Dirtt's picture

This obsession with Fox is borderline delusional and without a question juvenile.  Just stop watching it for christ's sake.

Rodent Freikorps's picture

Do you ever get the feeling some people here would go to the beach, and complain about the sand?

captain_menace's picture

Ever get sand up in your nether regions?  Sucks.

Strike Back's picture

No obsession here brej.  Don't even have cable.  Shit, don't even have T.V.  Just lamenting my, or our, own alienation.

Meme Iamfurst's picture

gosh, me either!  I would rather have a nice pair of shoes to go to work in then pay my hard earned money to a cable company that shows people dumber than I am.  What's to look up to or idolize?  At least all you great guys here on ZH are making me think and sometimes that hurts.

Treeplanter's picture

People on FOX talk about what is talked about here.  You hear references to zero hedge frequently and increasingly.  They have the audience for good reasons.

chubbar's picture

Well hey, not to butt in and change the subject or anything, but looky what the fucking cocksuckers up in washington state are proposing. That's right, a get out of jail free card for banksters through a total rewrite of the existing contract law that protects homebuyers.

Looks like those motherfuckers up in Wash State got a big payoff from the banksters and have rewritten contract law so that foreclosures don't need to have the actual wet ink promissory note.

Scroll down to item 7 (a).

Just fucking WOW if this goes through.



John Wilmot's picture

That seems to be almost an ex post facto...but we did that a while ago by rewriting the compensation contracts for some of the bankers didn't we...

financeguru500's picture

To Dirtt.

Making 1 post about Fox doesn't make me delusional. Stop your slandering. I was responding to the posts above me talking about CNBC saying how I saw something funny on Fox. If the news broadcast that I mentioned happened on any other channel I would have mentioned that channel instead.

The thing I found funny was recommending people to fill up their gas tanks before price rises which will only be helpful for a week because gas prices are set to stay high. If anything, if people all listened to that advice and all went out and filled up their gas tanks at the same time, they could cause unnecessary panic and price rises.

Calmyourself's picture

I have to agree.  For example, if you came trudging by my road frontage in rags and hungry, I would not give you a loaf of bread and a canned ham, it would only help for a week.  If I cannot completely and totally solve your problems why try to ameliorate them for a week or two. 

What if those people being smart, filled all their gas cans and the 55 gallon drum hidden in the garage.  Now their tiller and tractor work for the planting season.  Oh forget it they won't have it next year so better to starve now..


Bahh, bahh

financeguru500's picture

Thank you for your response Calmyourself.

Your post is exactly what I was meaning in my original post. Just because I mention the name of the news company that issued the bad advice doesn't mean I should get lambasted.

bigkahuna's picture

Carl is attempting to reinforce the belief. Most people have not a clue what Carl was talking about. Anyone who does have a clue has to know that Carl is BS'ing.

grok's picture

so clue us in..?  are you saying that the fed is not buying treasuries?  We already know that they are

bigkahuna's picture

Agreed-the fed is buying treasuries. Carl is holding up his part of the psy-op. Anyone who knows anything about the treasury markets knows the fed is the buyer. Carl just cant say it because many people have no idea what a treasury auction is--and Carl is keeping those folks in the dark. I apologize that I was not more clear.

prophet_banker's picture

zero hedge has already clarified this vicous profit making cycle; treasury sells to primary dealers [wall street banks ] and they sit on em for a week or so, and then sell the back to the fed for a profit

prophet_banker's picture

zero hedge has already clarified this vicous profit making cycle on US Treasury bills; treasury sells to primary dealers [wall street banks ] and they sit on em for a week or so, and then sell them back to the federal reserve bank for a profit

Miss anthrope's picture

haha, the best part..... was when Damon shoved Carl's foot in his mouth to stop spewing lies

DosZap's picture



What we are living thru has been in the works for thousands of years.None of this is accidental, or due to Wall St thieves, Bankers, and Politicians.

It's a part of the PLAN.

SheHunter's picture

Catch the look on Vickers' face when he says to Becky "Who is buying our debt??"  "WHO"??  Thnx for the post.

clymer's picture

Vickers = NWO shill. He grew up in the company

Drachma's picture

Exactly. He is an actor in psyop theatre. His role is framer of thesis-antithesis-synthesis.

chopper read's picture

LISTEN TO THESE CHARLATANS: "..'as we transition' to a 'global economy.'" " 'help investors' transition to a 'New World Order.'" ...DISGUSTINGLY TRANSPARENT NEUROLINGUISTIC PROGRAMMING.

Bleeping Fed's picture

Methinks the China bubble should rank #1.  God only knows what will happen when it pops.

falak pema's picture

classical beggar thy neighbour remark!! Lol!

John Wilmot's picture

I'm not so sure about the premise of your statement. China has been the favored child of the PTB for a very long time. The West built the Chinese industrial base in the same way that the West built the Soviet Union. Totalitarian state capitalism, what's not to like from their perspective? ...I don't see China collapsing any time soon.

falak pema's picture

Lets skip to 2012...this is too depressing!

impending doom's picture

Why don't you refrain from posting until 2012...

Blank Reg's picture

If you think 2011 is depressing, what makes you think 2012 will be any better?

Meme Iamfurst's picture

Mr. are really scaring me.  Last year I had a hard time making ends meet, this year it looks like I won't be able get them to even wavy at each other.

asdasmos's picture

Marc Faber McAlvany Interview 23 February 2011.



pslater's picture

Tnanks indeed.  Faber will be proved roght IMHO.

In Fed We Trust's picture

Awesome video, Alex Jones exposing the fraud that Glenn Beck is over a 15 minute expose. Rips him a new asshole.

francis_the_wonder_hamster's picture

Thanks for that link.....always like Alex Jones.

Beck, to state the obvious, is a tool (in more ways than one).

Edmund Dantes's picture

and yet Alex Jones will never touch the biggest issue of all.

High Plains Drifter's picture

No , he will not go near it . He is bought and paid for and probably was from the start.  This is the feeling of many now.  It was a lie from the start.