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Guest Post: Does Anyone Seriously Believe The Global Recovery Is Still Intact?

Tyler Durden's picture


Submitted by Charles Hugh Smith from Of Two Minds

Does Anyone Seriously Believe the Global Recovery Is Still Intact?  

A global recovery dependent on a spiraling addiction to debt and sovereign spending/intervention has been undermined on numerous fronts.

Today's exercise: design a semi-plausible scenario guaranteed to halt a global recovery that is entirely dependent on massive money printing, credit creation, Central Bank intervention and Central State spending.

I don't know about your answer, but here's my scenario for kicking out the rotten posts holding up a fragile, debt-fueled global recovery:

1. A natural disaster which disrupts production in one of the top four exporting nations, preferably one that is essential to the global manufacturing and high-tech supply chain. Once those supply chains are disrupted, then so are product cycles and profits.

2. An event that triggers a financial crisis in one of the four largest economies. The ideal setup for falling dominoes is to take a financially vulnerable major economy and topple it with an unexpected disaster.

3. Ignite a chain reaction of volatile mass movements in the major oil-exporting region of the world,
i.e. the Mideast. I don't mean the disruptions caused by small terrorist cells, I mean the unleashing of mass movements of ordinary people who have suddenly decided to renounce the delegitimized autocracies they have accepted for decades.

By their very nature, such movements are unpredictable, and the situation is thus intriniscally unstable--just what global markets fear.

4. A long-wave increase in global demand for essential materials and grains which are suffering drawdowns of inventory due to inadequate supply.
Throw in a few oil-rig disasters and failed crops in key regions of the world, and what might have been modest supply-demand imbalances balloon into shortages which trigger massive leaps in price.

5. Central banks and governments which have become addicted to radical increases in money supply, sovereign debt and spending to keep their economies afloat. As the banks can't control where these stupendous injections of "free money" will go, they are helpless spectators as the money seeks fat speculative returns somewhere, anywhere--a dynamic that leads to asset bubbles and commodity inflation.

An addiction to money and credit creation is an ideal setup for implosion: high inflation in tangible essentials generates social and political turmoil, while the stimulus acts as a "must-have" drug for the global economy: any slackening in the stimulus will trigger Cold Turkey: a rapid descent into illness and tremors.

6. A failed Status Quo which seeks to mask its own greed, incompetence and servitude to Financial Elites and fiefdoms via propaganda,
i.e. manipulating statistics, misrepresenting risk and obscuring the symbiotic relationship between the Central State and crony-cartel monopolies.

OK, let's run through the list:

1. Natural disaster dusrupts production in a key global exporter: check.

2. An event which nudges a major economy into financial crisis: check. (If you don't think Japan's economy and finances will be pushed over a threshold by the quake, please be patient.)

3. Ignite a chain reaction of mass movements in a key oil exporting region: check.

4. Supply-demand imbalances in critical materials and grains: check.

5. Central banks and sovereign states addicted to vast quantities of printing-money and credit creation stimulus which trigger rampant inflation in essentials: check.

6. Massaged statistics, channel-stuffing, misrepresentation of risk and unlimited propaganda by a failed Status Quo: check.

Does anyone seriously think the global recovery is still intact? Based on what? Does anyone think that stagnant/declining wages, falling real estate values, skyrocketing prices for materials and energy, and belt-tightening by bankrupt States are ideal foundations for higher profits?

Anyone who doesn't realize the quake in Japan is a tragic load dumped on a fragile addict's quivering back (i.e. the global recovery) will undoubtedly be surprised by how fast the global economy will start unraveling. Anyone who kept their eyes open is only wondering how a debt and propaganda-fueled recovery lasted this long.


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Mon, 03/14/2011 - 11:22 | 1050224 doomandbloom
doomandbloom's picture

Is it possible that a large proportion of the job losses is due to technology and not lack of growth. Then this was meant to happen.

The way forward could be for everyone to work 3/4 days a week( instead of 5/6). That way people who lost their jobs will get back to work.

The question is whether we are ready to take a pay cut. Other factors being personal greed and debt.

Mon, 03/14/2011 - 11:24 | 1050234 Dr. Porkchop
Dr. Porkchop's picture

It's very interesting what Kellog did with the six hour workday. I think we have other problems though.

Mon, 03/14/2011 - 11:31 | 1050272 GubbermintWorker
GubbermintWorker's picture

I'd gladly only work 3/4 days a week....uh, wait, nevermind...I already work less than that.

Mon, 03/14/2011 - 11:36 | 1050289 jus_lite_reading
jus_lite_reading's picture

HOLY CRAP! BREAKING NEWS!!! Rods in all three reactors are now melting!!!



Mon, 03/14/2011 - 11:40 | 1050309 alien-IQ
alien-IQ's picture


Mon, 03/14/2011 - 11:48 | 1050363 Sudden Debt
Sudden Debt's picture



Mon, 03/14/2011 - 11:55 | 1050409 Sudden Debt
Sudden Debt's picture

THAT'S IT!!!!!!!!!


I didn't mind the mercury but radiotion to...


Mon, 03/14/2011 - 21:54 | 1053170 jeff montanye
jeff montanye's picture

i don't know why i haven't seen it called such yet but how much bigger and blacker a swan do you need than the one that swam ashore from the northwest pacific last week?

Mon, 03/14/2011 - 11:39 | 1050315 Absinthe Minded
Absinthe Minded's picture

i have taken a pay cut. I have lost all the overtime I used to get. My paycheck is back to what I was making five years ago. Guess what, I'm thankful I've still got a job. But it pisses me off that my company, like the big banks, make all us peons bite the bullet while they buy new Iphones for all the management dicks, have catered lunches every Friday, and pretty much spend like drunken sailors. Companies are more productive than ever but they don't want to share it with the blue collar workers.I'm not pro-union but dammit I'm fed up with this bullshit.

Mon, 03/14/2011 - 13:35 | 1050939 bbaez
bbaez's picture

It is like all of the Corporate Welfare we are not addressing in [ "SPENDING CUTS" ]






Mon, 03/14/2011 - 12:33 | 1050620 JR
JR's picture

I don’t think this is the question.  For me, the question is whether we are prepared to allow these international corporations without borders to continue eroding American worker opportunities with their greed over patriotism.

A few years back, MIT counseled students not to pursue engineering careers because of the university “masters” already knew the path U.S.-based corporations would take.

These attitudes remind one of the great humanitarian view of CNN's Larry Kudlow"s comment on the Japanese disaster over the weekend: "The human toll here appears to be much worse than the economic toll, and we can be grateful for that."

Mon, 03/14/2011 - 13:21 | 1050869 PeterSchump
PeterSchump's picture

Did that dickhead really say that?

Mon, 03/14/2011 - 13:31 | 1050922 Ted Celeste
Ted Celeste's picture

For me, the question is whether we are prepared to allow these international corporations without borders to continue eroding American worker opportunities with their greed over patriotism.

Exactly.  This is one of the most important questions facing us all today yet we aren't anywhere close as a society to engaging with it.

Maybe we will one day, however.  In the interim, it is advisable to bone up on your survivalist skills.  And try to enjoy the ride as best we can - life is beautiful despite all the pain and craziness going on in the macro-world.

Mon, 03/14/2011 - 14:29 | 1051253 johnnynaps
johnnynaps's picture

Your wording is wrong. The way forward is that the cost of living for the average American is equivalent to 3 days work instead of 6. With our technology and resources, why not? Oh, guys like Mozilla, Soros and Paulson need 10 boats each!

I do believe that this is the answer though. We can't increase efficiency, resources and our population on this finite planet. It is simple mathematics. Everyone is going to have to learn to share a little.

Mon, 03/14/2011 - 11:26 | 1050227 Arch Duke Ferdinand
Arch Duke Ferdinand's picture

Oil revenues/prices gonna keep dropping big time due to Japan's decimated manufacturing economy, so...

War Is Definately Coming to Middle East....Shiites vs Sunni's..Iran vs Saudi Arabia

They both need oil revenue $$$....

Mon, 03/14/2011 - 11:28 | 1050249 AbandonShip
AbandonShip's picture

Posted in 2 threads now, eh?  Won't happen. They both have plenty of money/oil already.  And Sunnis don't hate Shiites as much as you think. In fact, many get along just fine.

Mon, 03/14/2011 - 11:38 | 1050308 4shzl
4shzl's picture

You're kidding, right?

Mon, 03/14/2011 - 11:45 | 1050356 Arch Duke Ferdinand
Arch Duke Ferdinand's picture

""And Sunnis don't hate Shiites as much as you think. In fact, many get along just fine.""

7 year Iran/Iraq war comes to mind.

...Factoid, Oil revenue/prices gonna drop 30% because Japan's economy is stopped dead in its tracks.

...Factoid, three Japanese nuclear reactors are leaking.

Saudi / Iran war is a given.

Course the reason for war will be blamed on Israel.

Mon, 03/14/2011 - 15:01 | 1051416 No Bid
No Bid's picture

Factiod... Without nuclear power they will have to use a lot more of the old fashioned stuff to get by.

Mon, 03/14/2011 - 11:38 | 1050301 4shzl
4shzl's picture

Gimme a break -- Bahrain = 40K bpd = who cares?   Certainly not Iran, they'll be lucky to keep their own troublemakers under control.

Mon, 03/14/2011 - 11:24 | 1050230 clones2
clones2's picture

So - you're saying I shouldn't sell my April VIX Calls today??? ;-)

Mon, 03/14/2011 - 11:24 | 1050235 NOTW777
NOTW777's picture

theres a long list of believers - 1. MSM, 2. cnbc/liesman, 3. obama supporters, etc

Mon, 03/14/2011 - 11:33 | 1050279 Alex Kintner
Alex Kintner's picture

I used to hang out at the Daily Kos site when everyone was bashing Bush (and deservedly so). But now. after Obama and the Dems have proved they are as bad as the Repubs, the denial is palpable. All the Obamabots are still singing "Kum bama ya".

Mon, 03/14/2011 - 11:37 | 1050295 IrishSamurai
IrishSamurai's picture

Yep.  The "your" guy sucks ... but "my" guy is awesome sauce syndrome.

Afflicts boths sides of idiot sheeple.

Mon, 03/14/2011 - 11:48 | 1050367 Alex Kintner
Alex Kintner's picture

+1. As the Lemmings jump off the cliff, they yell "Look, I'm flying!" :-)

Mon, 03/14/2011 - 22:03 | 1053210 jeff montanye
jeff montanye's picture

never did kos much but that is the tell.  anyone who hated bush's policies re: the military, civil liberties, financial bailout, transparency, whistle blower treatment (you get the drift) but makes excuses for (or, my goodness, likes) obama's policies in these areas, has no credibility.  i am thankful that their numbers seem to be shrinking slowly.

Mon, 03/14/2011 - 11:26 | 1050239 IrishSamurai
IrishSamurai's picture

"Way to harsh my mellow, Mr. Educated Dude." - Ted  (or the typical American sheeple these days)

Mon, 03/14/2011 - 11:25 | 1050240 vote_libertaria...
vote_libertarian_party's picture

"Still intact"....why the nice men with white teeth on TV keep telling me to buy buy buy.


Surely they wouldn't lie to us.

Mon, 03/14/2011 - 11:26 | 1050242 hugovanderbubble
hugovanderbubble's picture

Just buy the DIP¡:)

Mon, 03/14/2011 - 11:25 | 1050243 johnQpublic
johnQpublic's picture

never believed the recovery nonsense in the first place

even before i was reading ZH

no stretch of the imagination required here

Mon, 03/14/2011 - 11:38 | 1050306 MachoMan
MachoMan's picture

Exactly...  if everything was predicated upon the largest credit bubble in history and, post burst, demand for credit is declining...  then how can there even be a nominal recovery, let alone a real one?  And, further, in order to have a real recovery, there would need to be viable capital expenditures...  such as infrastructure development...  How many decades would we need to account for??? 

All I see are cost cutting measures to try and squeeze out that last bit of margin or direct handouts that go nowhere but hookers and blow. 

Mon, 03/14/2011 - 13:33 | 1050936 Kobe Beef
Kobe Beef's picture

Is there an ETF for hookers and blow? I'd like to invest in a growth sector.


Mon, 03/14/2011 - 15:18 | 1051498 MachoMan
MachoMan's picture

A few:









Mon, 03/14/2011 - 11:25 | 1050245 Quintus
Quintus's picture

Does anyone seriously think there was a global recovery except in the minds of the Fed and their shills?

Successfully keeping a braindead patient on life support for a couple of years does not constitute a 'Recovery' to my mind.

Mon, 03/14/2011 - 11:35 | 1050284 Rogerwilco
Rogerwilco's picture

So true. In the prior decades Americans spent, on average, about $1.08 for every dollar they earned, all financed by credit card borrowing and home-equity extractions. When that magic source of "income" dried up, the government stepped in to provide a 10% boost to GDP, and allowed trillions in losses to remain hidden.

The goose is full cooked.

Mon, 03/14/2011 - 11:28 | 1050246 falak pema
falak pema's picture

Benocide can print enough money to launch a zillion $ scheme to save : Japan, USA, Egypt, Tunisia, Libya, you name it. He is as proliferate as Gutenberg. Called "project marshmelon". A latter-day Marshall plan.

Mon, 03/14/2011 - 11:27 | 1050248 Silverhog
Silverhog's picture

I'm in the retail business. Business went off a cliff 2nd week in January. December was no great shakes.

Mon, 03/14/2011 - 13:04 | 1050795 Richard Head
Richard Head's picture

You should get some tips from Harry Wanker.  His retail business is off the hook, as far as we all know.

Mon, 03/14/2011 - 22:05 | 1053232 jeff montanye
jeff montanye's picture

haven't seen him wankin' around lately, have you?

Mon, 03/14/2011 - 11:29 | 1050252 clones2
clones2's picture

This could be the first day today that all 3 major indices close below their 50 DMA...

Tough to find any near-term support below the current levels.  Could be an ugly week.

Mon, 03/14/2011 - 11:29 | 1050253 FunkyMonkeyBoy
FunkyMonkeyBoy's picture

I believe!

I also believe that Barrack Obama was born in a U.S. state.

Mon, 03/14/2011 - 11:36 | 1050286 IrishSamurai
IrishSamurai's picture

"Everybody should believe in something -- I believe I'll have another drink." -- W. C. Fields

Mon, 03/14/2011 - 11:28 | 1050254 RobotTrader
RobotTrader's picture

The economy is in shambles.

But that won't stop everyone from buying AAPL products, buying SBUX coffee, and renting movies from NFLX.

The "Resilient Consumer" absolutely refuses to cave in.

I keep eyeballing the XRT to look for a short opportunity, but people keep buying it and propping it up.

Mon, 03/14/2011 - 11:32 | 1050268 the not so migh...
the not so mighty maximiza's picture

When you have radiation sickness low exertion activities like watching netflix and fingering your ipad might be the ticket.

Mon, 03/14/2011 - 11:45 | 1050346 sodbuster
sodbuster's picture

First iPad, now iPad2, I think that's why they named it an iPad- it's like feminine hygeine products, they want you to buy them on a regular basis.


Mon, 03/14/2011 - 11:57 | 1050424 velobabe
velobabe's picture

funny how that worked out. i wasn't a heavy bleeder,  kept costs down.

seriously, we were propaganda ed into thinking we need all these cleaning products for our home, body and personal hygiene. not really, just a little soap. i wash my dedicates, panties bras, etc in the shower with me. cuts down on shampoo cost and water use. i only shower every fourth day. but i can recycle my hair shampooing onto my dedicates. it is so fun, after the initial showerboarding warm up.

Mon, 03/14/2011 - 12:08 | 1050477 DRT RD
DRT RD's picture

I need you to have a talk with the wife.

Mon, 03/14/2011 - 12:05 | 1050464 Sudden Debt
Sudden Debt's picture

Does the Iphone have a Geigher counter?



Mon, 03/14/2011 - 15:36 | 1051579 Coast Watcher
Coast Watcher's picture

Isn't there an app for that?

Mon, 03/14/2011 - 13:06 | 1050803 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

The "Resilient Consumer" absolutely refuses to cave in.

It is not the consumer that refuses to cave in, it is the Resilient Wall Street Fraud" that refuses to cave in.

Mon, 03/14/2011 - 13:06 | 1050813 lieutenantjohnchard
lieutenantjohnchard's picture

another knee slapper from the old catfish mouth himself. it's the old twisted logic trick today which is where in one breath the catfish tells us the economy is in shambles and the next the consumer is resilient. yes, it's that same consumer who represents 2/3 of the economy that has the economy in shambles as he says. guess the economy was weak before it was strong. but that's just this post.

stay tuned for more insightful analysis from the old catfish. who knows, he may even tell us never to fight the fed and the pigmen. oh wait ... he already did that, about 50 times, each of which was followed by a post saying he was "itching" to short the market.

Mon, 03/14/2011 - 11:29 | 1050258 Head for the Hills
Head for the Hills's picture

"Anyone who doesn't realize the quake in Japan is a tragic load dumped on a fragile addict's quivering back"

This is poetic, but does not described the human situation.  Take for example the Soviet Union's return from the grave in 1943 to beat down the Nazi war machine.  Japan is nowhere near that far gone.

Mon, 03/14/2011 - 11:47 | 1050370 lunaticfringe
lunaticfringe's picture

Dude are you kidding me? Jpn has a 200% debt to GDP ratio. They are fucking toast. BoJ announced a 180 billion print ala pomo today. And you can damn sure bet we're gonna have to come in to help. Happy days are here again!

Mon, 03/14/2011 - 12:29 | 1050589 samsara
samsara's picture

It's not as easy to get up if Everyone fell down, AND you don't have 50 more years of $10-$20 dollar oil.

Peak Oil will hammer HARD anyone trying to get off the floor.

Past Analogies don't work no more.


Mon, 03/14/2011 - 11:29 | 1050260 ziggy59
ziggy59's picture

on bizarro world  Htrae...of course things are good when bad on Earth

Mon, 03/14/2011 - 11:43 | 1050261 John McCloy
John McCloy's picture

The ponzi masters will always blame someone or something for their failures.

In Jan it was Snow

In Feb it was oil

This month it will be Japan but the reality is there can be no recovery while we mistake printing for productivity.


Mon, 03/14/2011 - 11:30 | 1050263 LawsofPhysics
LawsofPhysics's picture

Finite planet bitches!  Growth economics is dead.  Hedge accordingly.

Mon, 03/14/2011 - 11:36 | 1050287 Flakmeister
Flakmeister's picture

Yep....  Flat is the new up

Mon, 03/14/2011 - 11:30 | 1050264 buzzsaw99
buzzsaw99's picture

The recovery was always a fraud.

Mon, 03/14/2011 - 11:32 | 1050273 sudzee
sudzee's picture

Treat yourself today to something memorable. A few years down the road you can say "i remember the good old days".

Mon, 03/14/2011 - 11:33 | 1050274 sudzee
sudzee's picture

Treat yourself today to something memorable. A few years down the road you can say "i remember the good old days".

Mon, 03/14/2011 - 11:47 | 1050369 Absinthe Minded
Absinthe Minded's picture

I agree, I love to play golf and try to budget in the $30 a week to walk 18 holes but sometimes it's not there. This year I'm going to play as much as possible because God only knows if I'll have another Summer to play.

Mon, 03/14/2011 - 13:38 | 1050962 Kobe Beef
Kobe Beef's picture

How about some hookers and blow?

Mon, 03/14/2011 - 14:36 | 1051287 andybev01
andybev01's picture beat me to it!

Mon, 03/14/2011 - 11:36 | 1050297 InconvenientCou...
InconvenientCounterParty's picture

The bouyant bid is propped by infinite debt creation. Japan is now demonstrating the extent at which central banks can defy capitol markets. ECB certainly sees the head-room they have.


Mon, 03/14/2011 - 11:38 | 1050310 clones2
clones2's picture

There are many manufacturing/export sites in Japan that have had operations temporarily halted in the region.  There are many US corporations where Asia is their fastest growing region.  Q1 numbers will be impacted by this as well as minor hits to margins due to higher oil prices.

These 2 factors together almost guarantee weak 1st quarter earnings...

Mon, 03/14/2011 - 11:40 | 1050311 GOSPLAN HERO
GOSPLAN HERO's picture

Silver, comrades!

Mon, 03/14/2011 - 11:42 | 1050330 shushup
shushup's picture

Not Me - Never believed there was a global recovery in the first place.

But as long as people still find the money to pay for overpriced i-products...who cares!


Mon, 03/14/2011 - 11:43 | 1050333 99er
99er's picture

SPX heading down towards its Diamond Top target while the Long Bond catches a bid.

Reality is starting to bite.

Mon, 03/14/2011 - 11:46 | 1050351 Doubleguns
Doubleguns's picture

Slow down----Recession----depression--(you are here)---hell----war.

Mon, 03/14/2011 - 11:46 | 1050358 squexx
squexx's picture

The recovery has to be going on! Cramer is telling me to buy! Would he lie?!?

Mon, 03/14/2011 - 11:46 | 1050364 Rainman
Rainman's picture

All the pump monkey pigmen and central planning propagandists are on high alert this week. They have their work cut out for them, but at least they bought time over the weekend to plan the spin on how it's all priced in.

Mon, 03/14/2011 - 11:48 | 1050365 jkruffin
jkruffin's picture

As this ponzi scheme implodes on Benny and Timmy, I think we need to free Bernie and put the other two morons in his cell together, and they can be butt buddies for life.  Americans need to demand their imprisonment.

Mon, 03/14/2011 - 11:48 | 1050366 rubearish10
rubearish10's picture

TD, don't post up this stuff, it supposed to be a secret, dammitt!


Mon, 03/14/2011 - 11:49 | 1050373 CulturalEngineer
CulturalEngineer's picture


"Does Anyone Seriously Believe The Global Recovery Is Still Intact?"

I saw a guy yesterday who  may actually believe it. But he was drooling, having trouble controlling his bowels and was ranting about 'pod people' taking over if we don't follow the advice of the FED.

Anyway, I think he's the only one.

How Would Hunter-gatherers Run the World? (Psst… They DO!)



Mon, 03/14/2011 - 11:52 | 1050388 lunaticfringe
lunaticfringe's picture

Japan's central bankers announce a 180 billion dollar print today for cleanup, lord know with a 200% debt to GDP already- they'll certainly have the capacity to pay this off. The two lost decades are proof of that capacity. *sinister laugh, mu who ha ha.

Mon, 03/14/2011 - 12:07 | 1050463 The Count
The Count's picture

The prices for MRE on Ebay have been going up dramatically recently. I bought cases for $40 plus ship about 2 years ago, yesterday I say one case go for $127!!!


MRE bitchez!!!!!!!!!!!!!!

PS you cant eat precious metals

Mon, 03/14/2011 - 12:11 | 1050492 william the bastard
william the bastard's picture


What would Mohamed El-Erian do?

Mon, 03/14/2011 - 12:12 | 1050499 mendigo
mendigo's picture

declining standard of living, massaged stats, corrupt financial system, middle-east conflict

what's new about that?

what is new is that people are starting to notice what a mess we are in

the tradgedy in japan may just be the thing that wakes them up and they may end-up being the nation thats leads the world out of this disaster - in like 20-50 years

the best thing that could happen to us in the near term is a complete collapse


Mon, 03/14/2011 - 12:17 | 1050540 That Peak Oil Guy
That Peak Oil Guy's picture

You missed a checkpoint in your list: global IPv4 addess depletion forcing conversion to IPv6 addresses.

This may not sound like a big deal, but the reason most of the US has not converted to IPv6 is because it is a nightmare.  How much of the economy now relies on a functioning Internet?  If conversion to IPv6 causes a 10% hit to productivity then how will that impact the economy?


Mon, 03/14/2011 - 12:57 | 1050741 Rogerwilco
Rogerwilco's picture

And don't forget, IPv6 = end of easy anonymity. How much do you really love Big Brother? We're about to find the answer to that question on an individual basis.

IPv6 could very well mark the end of the blogosphere, and there are few large organizations/governments that would shed a tear.

Mon, 03/14/2011 - 13:14 | 1050846 j.darkness
j.darkness's picture

Some of the corporations that robot trader likes to speak of have large cash positions on their balance sheets.  My dad likes to use this to convince me that everything is fine, gdp is growing...blah blah.  Obviously I disagree and can refute many of his points but this one...what are the companies sitting on thier cash for?  i understand they have some cash from firing many people and are then more profitable, but sitting on cash does not help the corporation (maybe bond yields?) or the economy in any way.  Only if corps invest that cash to increase productivity or production does that cash have any meaningful value, right?  -trying to understand, regards, j.d

Mon, 03/14/2011 - 14:45 | 1051330 Flakmeister
Flakmeister's picture

On the whole, the large cash balance is bearish... it tells me that they have no idea how to productively invest it.. Past experiences with overpaying for growth via acquistions has tempered their actions... They are waiting for real bargins to occur, I think they may be disappointed. Another factor is that some of this cash is sterile, tied up overseas with limited egress.

Mon, 03/14/2011 - 13:17 | 1050848 SilverBaron
SilverBaron's picture

Go long on rice, geiger counters, lead blankets, and Iodide. 

Oh, and body bags/coffins.

Mon, 03/14/2011 - 13:38 | 1050968 bbaez
bbaez's picture

You Forgot

-Green Ink

-Printing Presses

-Cotton Paper


Mon, 03/14/2011 - 13:37 | 1050955 rcmullins
rcmullins's picture

Nobody believes in the recovery, but what you do find is this;

1.  I know there is no recovery but I'm going to continue my life as it is and hopefully it will get fixed over time.

2.  I know there is no recovery but we Americans are resilient and innovative and I'm putting my hope in the fact that maybe there is someone out there with the answers that will step forward, you know, like Braveheart

3.  This is just a rough patch, America is forever didn't you know that?

Mon, 03/14/2011 - 13:44 | 1050993 tiger7905
tiger7905's picture

If Charles Nenner is write it's going to get a lot worse, see clip here

Mon, 03/14/2011 - 13:50 | 1051038 locinvestor
locinvestor's picture

Of course it's not. It never was to begin with.

With the earthquake and nuclear plant problems in Japan, this is going to set off endless speculation and hyping of fear. Key industries will be affected. The Japanese and intl. business media will naturally put out the "official" line that all's well. Which means that public fear will only increase.

Setting aside language and cultural differences, one key problem is mass apathy and ignoring reality. If you don't trust your politicians, then why do you keep re-electing them? if Obama is so bad, why would elect a neocon who's much worse?

Look at the continuing protests in Wisconsin. If the issues they're fighting for are so valid, how come millions nationwide aren't fighting as well? Either they affect everyone or they don't.

The answer? Fear. Fear of the economy. Fear of losing your job, your home, your family. No national health care. New neocon Congresspeople bitch about the "evils of Obama's 'socialist' health care". Yet,  when they switch from commercial to national(govt.) care, if there's a gap they bitch about it. Who's the hypocrite in this scenario?

Also, fear of the govt. If that's not true, then how come millions permit the govt. to torture Bradley Manning in prision? Because they're afraid of being labeled as a "terrorist" by their friends, family, community or possibly their boss. Manning did the right thing. Yet, now he's on his own? If a neocon was being tortured in prison or had a family member in prison the corporate MSM would be screaming about this. But, what do you hear about Manning? He's still in solitary. He's still forced to be naked for hours at a time. He has 23 hours in his cell. But, because millions aren't ganging up on the White House to stop this, that makes it ok? It doesn't directly affect me. So what the hell do I care.

Saying Obama should fire Bernanke or we should close the Fed makes nice soundbites. But the truth that nobody wants to face is that it takes more than soundbites.

You can only "analyze" something for so long.



Mon, 03/14/2011 - 14:45 | 1051324 ivars
ivars's picture

This I repost here. The DJIA stock market curve suggests 2-4% drop in the USA quaterly y.o.y. GDP in Q1 2012. So no recovery. Also I explain how I make my graphs-anyone can do it.


Seems that my February 6th predictions were fairly accurate when the stock market (DJIA) will peak. I predicted it will peak on Feb 15th, in the graph below. It did peak ( anyone doubts we are heading South from here?) at February 18th, just over weekend from my prediction. Now let us see what happens next, but all latest the news are encouraging ( meaning BAD) for the following months forecast. Its going to go down till end of May/beginning of June. Then a small lift, perhaps QE3, perhaps Oil prices will drop temporarily.

Also, my Oil price prediction from February 6th showed correctly the first peak in Oil prices in the end of February and now is showing correctly the drop during middle March. What it shows next, is a bigger peak than first one, with prices reaching approximately 10USD higher levels ( e.g Brent around 125-130 USD) then in previous peak, around April 1st.Then a drop again, to the same levels as today, in early May. And then it really starts going up. Its all mostly related to supply disruptions in Arab world, however, now we have also potential demand increase if nuclear sites worldwide are going to be closed for inspections/safety add-ons.

The graphs themselves are built by pattern matching after shocks for individual stock indexes and commodities , and for them to work, the index/commodity must be truly global, influenced by information from all over the world. Hence for DJIA and Oil it may wrork relatively well, let us see.

I explain how I made these graphs here:


I am taking the patterns of each commodity or stocks as they developed in the aftermath of 9/11 when the world experienced a shock and after that, an unprecedented period of NEVER before seen cooperation which later led to de cooperation , e.g on Iraq war issue etc.

So, in the period of Sept 2001- 2004-2006 the world slowly underwent transition from absolute cooperation ( remember Bush approval in the USA was 90%?) to normal deco operation levels. That impacted reactions to all information flows, aggregate reaction of people etc.

I try to match the graphs after 9/11 to graphs after another similar in its psychological uniting ability, financial shock of September 2008-March 2009 when world again showed extreme abnormal cooperation and synchronization of actions. And then it starts to de cooperate. The patterns should be the same, as each graph has its own time constant and interacts with all the other patterns in the world, aggregate the information- its well known that DJIA is , in fact, a biggest global information market, not just stock value market based on business performance-which has its own internal reaction times etc.- can be seen from linear damped oscillator response function to e.g. 2008-2009 financial shock. But, the graph has several pockets of non-linearity which damped oscillator does not have, like 2010 April-September dip. However, for information market as DJIA, its a typical dip whenever recovery happens after some shock , almost on all scales ( if not washed out by some bigger event).

I consider 9/11 and 2008 financial crisis comparable on scale of impact of cooperation levels shown by people involved, each by its own reason, but with the same behavioral patterns resulting.

There are some assumptions in it which make this exercise not so linear, that is where to place 9/11 on post 2008 graphs. That is a little trick to which I think I have found explanation, but would not delve into it now, as that is the key, but , if someone thinks about it, there is a logical place for a shift between minimums as preparations and decision making leading to 9/11 where done in secrecy and thus did not show up in DJIA , but it should have, if it had been known as decisions resulting in unavoidable act of terror with at fist unknown, than known targets, but unknown outcome.

After that, its just pattern matching plus some wishful thinking ( see my latest here on Silver- I essentially draw the graph, looked at it, and predicted an attempt to return to gold standard by whoever wins in 2012 - an attempt which most likely will either fail or will not look like Ron Paul imagines it today).

And so graphs are born, and then tested repeatedly as scales are changed , stretched, and timing remains the most difficult thing to be exact with.

Mon, 03/14/2011 - 14:47 | 1051338 pyite
pyite's picture

Of course the recovery is going along fine - it just doesn't trickle down as far as the party in power would like us to believe.


Mon, 03/14/2011 - 14:50 | 1051348 Grand Supercycle
Grand Supercycle's picture

I'm sticking to my Feb 22 call that the DOW topped on Feb 18 2011 and signals the end of the rally.

Mon, 03/14/2011 - 14:49 | 1051356 Grand Supercycle
Grand Supercycle's picture

The March 2009 lows will be breached according to my analysis.


Mon, 03/14/2011 - 15:31 | 1051559 tony bonn
tony bonn's picture

does anyone seriously believe the global recovery ever started?

Mon, 03/14/2011 - 15:55 | 1051672 hidingfromhelis
hidingfromhelis's picture

If a recovery comprised of duct tape, steoroids, and crystal meth is considered intact, then yes.  Wait, scratch duct tape from that; it is used to actually fix things. 

Mon, 03/14/2011 - 16:31 | 1051849 jmc8888
jmc8888's picture

This is actually pretty good by CHS.

Glass-Steagall (which would wisk the bad from the good, make the markets 'real' again, and allow us a real possiblity of getting out, which we would)

Cancel the fraudulent bad debt, and we need not print nor cut (needs).  I'm all for cutting big wars, big bailouts, etc.

But unless Glass-Steagall, or the same principles under another name are enacted, we will go down. 

We don't need Braveheart, we need Glass-Steagall.

If we don't, then CHS has pegged some pertinent things.  We WILL pass some sort of Glass-Steagall, the ONLY question is....will we do it BEFORE or AFTER the crash?

Churchill was right about one thing, as mentioned earlier today, if we don't do something about our situation now when SHTF is mostly preventable, we'll be forced to do the same thing when very little is preventable, or when none of it is (since we'd be completely living in it). 

Wow, I just used Churchill's words to advocate the rationale for Glass-Steagall. 

Mon, 03/14/2011 - 19:48 | 1052659 trendybull459
trendybull459's picture

People get together,anyone who cares about basic problem of our existance FED invited to vote in our poll and read out latest comments on yahoo FED article about QE3:

Voting poll is waiting for you click,take 5sec to make your choice,we must to reach critical level to be recognised by others to tove too!Thank you and keep all us together regardless government effords,we appreciate if you link us to other polls,blogs,sites to let people or your friiends to vote FED existence

Mon, 03/14/2011 - 21:46 | 1053141 Blank Reg
Blank Reg's picture

I'm lucky. I have a bad heart that gives me disability for about 5 to 10 years before it kills me. I don't think I want to be around past that anyway.

Tue, 03/15/2011 - 06:16 | 1054706 SparkRevolt
SparkRevolt's picture

Um, no.

Do NOT follow this link or you will be banned from the site!