This page has been archived and commenting is disabled.

Putting The Fed To Shame, Presenting The Galaxy's Biggest Bubble

Tyler Durden's picture


Some delightful observations on two sets of bubbles by United-ICAP's Walter Zimmerman: one are those blown with impunity by the Federal Reserve; the other are those that put even the Greenspan-Bernanke legacy to shame, with a diameter of 50,000 light years. The latter are entertaining, but the former are far more relevant to our everyday lives. And on those, Zimmerman says the following: "Now if one studies history one finds out that the Federal Reserve was formed to prevent speculative panics, to maintain the value of the dollar, to preserve the purchasing power of the consumer, and to responsibly manage the nations money supply. Has an organization ever  strayed as far from accomplishing its goals as the Fed?" We can only hope Princeton's cosmological program is subpar (unlikely), as otherwise Bernanke may decide that 50,000 light years across is a perfectly reasonable number for a bubble. The next question, of course, is what amount of dollar bills would fill up a sphere with a radius of 25k light years...

Observations from Walter Zimmerman, United-ICAP

The Golden Age of the Speculative Bubble

We have noted before that we have all been passing through a golden age of speculative financial bubbles. Since the year 2000 the history of the financial markets has been the history of a series of bubbles. By now we are all familiar with the sequence. First the speculative bubble inflates, then the bubble bursts, and then a financial panic ensues. From 2000 the internet bubble burst. From 2005 the real estate bubble burst. From 2007 the stock market bubble burst. From 2008 the commodity bubble burst. As we write this it would appear that the bond bubble and the gold bubble are now bursting. Never before in history has there been such an extended and frenetic sequence of speculative bubbles.

This observation naturally raises a few big questions. For example, where is all the money coming from? Why are traders and investors not picking up on the destructive effect these bubbles have on preserving and creating wealth? What is it about our financial system that lends it to such prolific speculative bubble creation? How did we get here? How can anyone maintain that the path that led us all here is the path of progress? And how does the financial system move beyond this destructive frenzy?

Many blame Alan Greenspan for initiating the bubble economy. There is an excellent book that details this case. It is “Greenspan’s Bubbles” by William A. Fleckstein. If one digs a bit deeper one finds that the very structure of the Federal Reserve is a co-conspirator in all this. There is an excellent book that delves into this aspect. It is “The Mystery of Banking” by Murray Rothbard. We would just like to make a few observations before introducing the largest bubble yet found by science.

We would first note that investment banks used to make money by actually investing in America. They would connect investment capital with companies that needed capital to grow. Now investment banks make their money by trading. In perhaps the most obvious case Goldman Sachs made 69% of their income during the most recent quarter from trading. While they may be the most extreme instance, among the so-called investment banks they are also the most envied.

Part of the problem may be that this country has been living beyond its means since the 1960’s. One result is that pension funds are under-funded by trillions of dollars. Governments on all levels are technically bankrupt. In the United States we have an entire generation of baby boomers that are about to retire but somehow forgot to save any money. Complicating their efforts is the fact that one in four Americans are underwater on their mortgage. Everywhere you look one sees a great need for large amounts of fast cash. Who these days has the patience and the luxury of time to actually invest? Everyone knows that trading is a faster path to riches. But how can everyone make money trading at the same time? This is the herding dynamic that creates speculative bubbles.

Now if one studies history one finds out that the Federal Reserve was formed to prevent speculative panics, to maintain the value of the dollar, to preserve the purchasing power of the consumer, and to responsibly manage the nations money supply. Has an organization ever strayed as far from accomplishing its goals as the Fed?

Big Speculative Bubbles: Art Imitating Nature?

“No form of Nature is inferior to Art; for the arts merely imitate natural forms.” Meditations. xi. 10. Marcus Aurelius

The fields of economics and finance as they are practiced today are clearly not sciences. And we would not be overly generous to call them art forms. In both the arts and modern day finance creativity is the key. In both the arts and finance things are being done today that have never been done before. Both fields lend themselves to excess, as in both fields big productions are popular. So if the field of modern day finance is an art, and if the output of this art form is the speculative bubble, we should not be surprised to find that bubbles are common in nature.

In one of the great ironies of our age of the speculative financial bubble, science has just found what could well be one of the largest  bubbles in Nature. And just as academic economists are clue-less as to what is behind the hectic sequence of speculative financial bubbles, cosmologists and astronomers are stumped by what could have possibly created the massive bubbles just discovered. See next page.

These newly discovered gamma-ray bubbles extend out roughly 50,000 light-years or about half the diameter of our Milky Way galaxy. And the bubbles are centered at the core of the Milky Way. Thankfully the bubbles are not centered over planet Earth. These are gamma-ray bubbles and gamma rays are the most energetic form of radiation by far. They were found based on observations by Fermi - an orbiting gamma ray detector.

At this early stage scientists can only speculate as to what could have possibly produced such enormous and energetic bubbles. Alan Greenspan may well be much older than he looks, but he is neither old enough nor powerful enough to have produced bubbles this big. It does seem rather safe to suppose that scientists will have these gigantic bubbles completely figured out well before economists realize that their own ill-conceived financial policies are behind the bountiful bubble creation that began over ten years ago in year 2000 - and as yet show no signs of subsiding.

Meanwhile we have new financial bubbles bursting in air. A financial fourth of July is upon us. Our technical analysis suggests the following:

  • DX Index ( US $ ) - a decisive break out above 79.600 targets parity with the Euro-fx currency
  • Interest Rates - a decisive break out above 2.970% in the interest rate on the ten year treasury note targets an eventual 5.15%
  • S&P 500 Index - a decisive break below 1158.00 in the SPX implies a 1095.00 minimum target. Watch out below if 1095.00 breaks
  • WTI - the crude oil bulls are in big trouble on a decisive close below the 81.30 level. Peg 73.55 the minimum target from there.
  • Gold - a decisive spot close below 1340.0 in our book targets to 965.0 minimum. And watch out below if 965.0 fails to hold.

“Viewed in an artist’s illustration created by NASA, the structure looks like two luminescent, purple, egg-shaped ovals sitting
on top of one-another, intersected by the tiny-looking Milky Way. In the actual images created from layers of processed Fermi
data, the lobes are still there, but are white with flecks of red, surrounded by a sea of blue and red gamma-ray activity — the
Milky Way forming a white slash between the two ovals.”


- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Tue, 11/16/2010 - 17:46 | 732449 Mongo
Mongo's picture

Once you pop... you can't stop

Tue, 11/16/2010 - 17:49 | 732463 chopper read
chopper read's picture

so let it be written, so let it be done.

Tue, 11/16/2010 - 18:29 | 732569 anony
anony's picture

Gotta get an editor, dude.

Tue, 11/16/2010 - 21:11 | 732951 ATG
ATG's picture

Brilliant analysis here

Art indeed imitates nature, and the gamma ray bubbles on either side of the Milky Way appear to mediate solar flares and coronal mass ejections that mediate magnetic fields, life and the markets

Gold has indeed closed below 1340, next target 965 and then look out below

As gold leads most other assets, the popping of the bubble casino economy may appear imminent

QE II = Titanic II

Wed, 11/17/2010 - 01:10 | 733334 merehuman
merehuman's picture

.bullshit, gold is going higher. Gold has millions of reasons for going up. But only the real gold, not the paper.And if it did drop, none of us who have any will give it up for paper.

So...up your bucket!

Wed, 11/17/2010 - 07:21 | 733515 Thomas
Thomas's picture

I don't think commodities hit bubble territory either. They did, however, get ahead of themselves. As to gold, I assume a bubble probably needs mania affiliated with it, and gold has certainly not reached mania stage. I still can't name a single person that I see on a daily basis who buys gold. Not a one. I don't either only because I am about 55% precious metals now. (Gold bug since 1999.)

Tue, 11/16/2010 - 18:11 | 732522 Gone Full Retard
Gone Full Retard's picture

No dudes it's Projects Blue Beams?

See "Step Two"

Tue, 11/16/2010 - 18:16 | 732533 Triggernometry
Triggernometry's picture

That $3.16485x10^54 to fill that bubble.

Piece of cake. Though even if $1T were printed every second since the beginning of the Universe, we still wouldn't have put a dent($4.09968x10^29 assuming 13bn years and ingnoring extra days in leap years).

Silver, bitchez!!

Tue, 11/16/2010 - 19:24 | 732730 Shameful
Shameful's picture

That's just it printing is not the problem.  With the right gear Ben could pop out $1.189731495357231765085759326628007 × 10^4932 dollars, no problem.  That might even be high enough to sate his devaluation thirst...maybe...probably have to move up from $100s though running into a cotton problem...

Tue, 11/16/2010 - 19:40 | 732769 aint no fortuna...
aint no fortunate son's picture

is that like 50,000 Miles Beneath my Brain?

Tue, 11/16/2010 - 17:48 | 732459 Shameful
Shameful's picture

Dammit!  I can almost see Zimbabwe Ben rolling up his sleeves "Ok Universe!  You want to throw down the gauntlet?  Your on!"

Tue, 11/16/2010 - 18:01 | 732497 Sudden Debt
Sudden Debt's picture

Somebody better warn the WWF and Greenpeace because when Benny B. figures out where he'll has to get his pulp from to print it all there won't be a three left when he's done.

Tue, 11/16/2010 - 22:35 | 733090 metastar
metastar's picture

Yes, matter in the universe must be finite. Dollars in the money supply can be infinite. But then again, even infinity has a cardinal value to which I am sure the FED is looking to inflate.

For more fun FED math facts see:


Tue, 11/16/2010 - 17:52 | 732471 Fraud-Esq
Fraud-Esq's picture

Is there more inflationary pressure now than in 2006 or just in different segments? Fractured economy. 

If you have $300,000 cash, you rent, and you want to buy a new home in 2011, keeping $300,000 in CASH might yield you10-15% (without risk) toward that asset you're targeting. That's a good yield! I have to exclude PM and all other investments from this simple equation only to keep it clean. So, from that point of view, deflation in housing is your friend.   

The inflation/deflation or biflation scenarios point each investor into a different direction depending on what you want/need. 


Tue, 11/16/2010 - 17:53 | 732474 traderjoe
traderjoe's picture

"Now if one studies history one finds out that the Federal Reserve was formed to prevent speculative panics, to maintain the value of the dollar, to preserve the purchasing power of the consumer, and to responsibly manage the nations money supply. Has an organization ever  strayed as far from accomplishing its goals as the Fed?"

- Uh, really? No actually the Fed was formed to create panics, debase the value of the dollar, steal the purchasing power/wealth of the consumer, and responsibly manage and ride shotgun for the affairs of its owners - the private banks. 

Amazing that anyone with a modicum of intelligence, skepticism, and willingness to be open to the Truth, still believes the Fed is attempting to act for the benefit of the general public. 

Tue, 11/16/2010 - 20:09 | 732852 Patrick Bateman
Patrick Bateman's picture

Absolutely. 2012? Fuck that, Dec. 23rd 2013, 100 year anniversary for the destruction of the dollar. What new fiat currency will we print now? Just another that will fail, eventually. Gold, silver............... Bitchez.

Tue, 11/16/2010 - 17:53 | 732475 RobotTrader
RobotTrader's picture

Clearly, the "Commodity Wildebeests" who were banking on a myriad number of phony theories:

"QE to Infinity"

"Peak Oil"

"We Are Running Out of Food!"

They are all getting margined called right now....

Tue, 11/16/2010 - 18:03 | 732508 Takingbets
Takingbets's picture

Hey robo, can you explain why the futures markets always open lower than the market closes? (see link below)

Thanks for any light shed upon this dilemma of mine. :-)


Tue, 11/16/2010 - 18:06 | 732515 Burnbright
Burnbright's picture

1% moves in a day is noise and should be rather common by now. I find your antics to be comical because of how clueless you truly are. Expect greater volatility in the future before things break down.

Tue, 11/16/2010 - 18:33 | 732580 Gone Full Retard
Gone Full Retard's picture

"margins calls right nows"

There I fixed it 4 U?

Tue, 11/16/2010 - 18:51 | 732637 DarkMath
DarkMath's picture

"QE to Infinity"

So you don't believe there will be another QE? Oh my Robot, you are naive. Let's put it this way, if there isn't another QE (to bail out the states and support the Bond market) then you might as well start hunting wildabeasts for food because it will get ugly here. Without another QE the stock market will promplty sink to about Dow 2,000. Your nemisis Robert Prechter will be proven correct and you don't want that to happen.

So which is it: QE to Infinity or getting on your knees before Robert Prechter? You can't have it both ways Robot.

Tue, 11/16/2010 - 19:19 | 732718 VK
VK's picture

WTF Robo?

In the short term, finance trumps energy and ecology simply because the later are slower moving systems. In the longer run, we have a fucking energy crisis. Every single oil field in the world increases production, reaches a peak and then declines. EVERY SINGLE ONE and we have more than a CENTURY of data. The planet is a finite sphere. You can only squeeze so much orange out of an orange juice, same with oil. Just because you're ignorant about geophysics and the laws of thermodynamics doesn't mean they're wrong just because you don't happen to agree with math, physics and logic. World oil production has peaked and will decline, taking down industrial civilization with it.

Tue, 11/16/2010 - 20:14 | 732864 Patrick Bateman
Patrick Bateman's picture

Agreed. Sounds to me like someone who thinks "peak oil" means running out of oil. That's not even what peak oil is about. When you have corporations looking for a profit, who in the fuck do you think is going to drill a well of heavy crude to not make any money? NOBODY. The oil is there, the profit is not, hence peak oil.

Tue, 11/16/2010 - 19:48 | 732787 Quantum Nucleonics
Quantum Nucleonics's picture

Unseen in this photo are the 20 foot 2000 pound Nile crocodiles snatching and dismembering the occassional, unlucky wildebeest.

Tue, 11/16/2010 - 17:59 | 732488 Dollar Bill Hiccup
Dollar Bill Hiccup's picture

To infinity and beyond ?

Tue, 11/16/2010 - 20:45 | 732494 Dollar Bill Hiccup
Dollar Bill Hiccup's picture

Dupe, sorry

Tue, 11/16/2010 - 18:02 | 732498 Double down
Double down's picture

Nice picture, pretty crapy "analysis".  If you cannot contribute anything new do not create noise.

Tue, 11/16/2010 - 18:02 | 732500 Chartist
Chartist's picture

Well, there's 1.3 billion chinese and 1.3 billion indians and they all want what we want:  color TV with 300 channels, a house with two cars in the garage.

Tue, 11/16/2010 - 20:38 | 732905 Xedus129
Xedus129's picture

2 cars?  That's so 1990's.

Tue, 11/16/2010 - 18:06 | 732511 whisperin
whisperin's picture

Okay, so your sayin God was an economist?


EDIT: Uh, with a Phd. of course!

Tue, 11/16/2010 - 18:08 | 732518 tony bonn
tony bonn's picture

"First the speculative bubble inflates, then the bubble bursts, and then a financial panic ensues." and then the taxpayer is fucked into bailing out the miscreants.

Tue, 11/16/2010 - 18:09 | 732520 txapela
txapela's picture

"Gold - a decisive spot close below 1340.0 in our book targets to 965.0 minimum. And watch out below if 965.0 fails to hold."


what does that mean: "And watch out below if 965.0 fails to hold."?


Are they expecting Gold to go down, and nto up?

Tue, 11/16/2010 - 18:35 | 732586 Citxmech
Citxmech's picture

Yeah - I noticed that part and almost called bullshit - but I s'pose if the Dollar and the Euro crossed we could see some real turmoil in the commodities markets - or if the Dow/S&P crashed, but that would just be another, perhaps last, buying point before the Fed quickly announced QEIII and flushed the FRN down the crapper for good. 

Personally, I'd be amazed if Au fell below $1200/oz for any length of time, no matter what happens. 

Just not seeing it with the POO either - especially not going into winter.

Tue, 11/16/2010 - 19:15 | 732704 unky
unky's picture

Lets just assume all Euro denominated assets are wiped out because of a default in the Euro-Area. Wouldnt that mean, that there is less paper currency in circulation and gold priced in dollars indeed would go down?

Tue, 11/16/2010 - 20:40 | 732907 Xedus129
Xedus129's picture

Price in FRN's is irrelevant IMO.  If the price drops that low I expect physical supply to vanish..  Especially with silver.

Thu, 11/18/2010 - 03:56 | 733258 Sespian
Sespian's picture

Agreed.  Long term, it's about value not price.  The majority of silver mined is a by-product of mining other industrial metals, as industry demand in general goes down, so does the supply of silver.  Scarcity is maintained.

Tue, 11/16/2010 - 18:10 | 732521 Bastiat
Bastiat's picture

"It does seem rather safe to suppose that scientists will have these gigantic bubbles completely figured out well before economists realize that their own ill-conceived financial policies"

Maybe not -- it seems astromers are caught in their own dsyfunctional paradigms.  That's why they are daily "surprised" at what they observe, just like economists.  They are surprised because their expectations are determined by their inadequate models.   Just as with economics, the institution of astronomy defends its credibility with blind zeal--there are a lot of careers and lots of grant money at stake.  If you are at all a science buff check this out sometime:

A taste:  No black hole as ever been observed nor can one be by definition.  What are observed are highly energetic events.  Black holes are a theotical construct posited to make a "gravity only" model explain these enormous energy concentrations.  Fact:  electro-magnetism is 10^38 times more powerful than gravity.  But of course, EVERYONE knows about black holes, right?

Great stuff, if you have an interest.



Tue, 11/16/2010 - 18:26 | 732558 anony
anony's picture

Sports guy chest bump~~~ )(

Tue, 11/16/2010 - 20:55 | 732933 Implicit simplicit
Implicit simplicit's picture

Interesting. It shut me off after 3 chapters.

At least the debate about dark matter, electric plasma and black holes doesn't affect the economy like the science- not, of economics.

Wed, 11/17/2010 - 02:23 | 733390 StychoKiller
StychoKiller's picture

Astronomers, like most Scientists, learn from wrong theories and move on -- Economists, not so much!

Wed, 11/17/2010 - 10:13 | 733791 Bastiat
Bastiat's picture

Science should work that way but when careers become invested in wrong theories they become orthodoxy and changes are more revolutionary than evolutionary. The more fundamental the wrong theory, the more resistance.   Astronomy is all about grant money.  "Deviant" ideas are not tolerated or discussed--Phd dissertations are "advised" in an orthodox direction--and that's where they go if the candidate wants to be employed.

Tue, 11/16/2010 - 18:11 | 732525 Fraud-Esq
Fraud-Esq's picture

"Wolf argues that central banks “can surely lean against the wind” even if they cannot eliminate bubbles. I know of no instance in which such a policy has been successful. For reasons I have outlined elsewhere, (American Economic Association presentation, January 2004) I doubt that it is possible. If it turns out it is feasible, I would become a strong supporter of “leaning against the wind.” - Lying Greenspan 

Tue, 11/16/2010 - 18:13 | 732528 sbenard
sbenard's picture

Once we realize that the REAL mission of the Fed isn't the one that it shouldd be, as stated by Mr. Zimmerman, and that its REAL mission is to socialize the gross errors of the TBTF banks, then we must admit that the Fed has been immensely successful! It has been all too successful. And that's why we're all going to crash and burn!

Tue, 11/16/2010 - 18:13 | 732529 Fraud-Esq
Fraud-Esq's picture

"Aside from far greater efforts to ferret out fraud (a long time concern of mine).." - A. Greenspan

Tue, 11/16/2010 - 18:22 | 732536 Fraud-Esq
Fraud-Esq's picture

"Many blame Alan Greenspan for initiating the bubble economy. There is an excellent book that details this case. It is “Greenspan’s Bubbles” by William A. Fleckstein. If one digs a bit deeper one finds that the very structure of the Federal Reserve is a co-conspirator in all this. There is an excellent book that delves into this aspect."

  • You don't need a book, it's an obvious conflict of interest. 
  • Of course the Fed was a co-conspirator, Greenspan couldn't have done it without the Fed. He'd be a jazz musician perhaps. But, he could have also NOT DONE IT with it. Can't miss that logic. That would assume FULL independence from the banking industry, of which there is little to none. So, it's unlikely because it's corrupt.
  • People talk about "independence" today, but ONLY in regards to the Fed's relationship with the government. That makes me belly laugh. Short of eliminating the FED, government interference may be our only chance. Remember Jackson.  

Tue, 11/16/2010 - 21:51 | 732567 plocequ1
plocequ1's picture

Bones McCoy: Dammit Jim!! This defies logic. Mr Spock, What do you make of this Galactic bubble?

Mr Spock: Astounding Bones. This is even more illogical than that flying NBC Volkswagon Bus we saw back in the SNL days

Tue, 11/16/2010 - 18:38 | 732597 Quinvarius
Quinvarius's picture

and another sucker bets the dollar is not a bubble but gold is

Tue, 11/16/2010 - 21:17 | 732964 ATG
ATG's picture

Time will always tell

Tue, 11/16/2010 - 18:39 | 732598 Quinvarius
Quinvarius's picture

and another sucker bets the dollar is not a bubble but gold is

Tue, 11/16/2010 - 21:17 | 732965 ATG
ATG's picture

Tell will always time

Tue, 11/16/2010 - 18:39 | 732600 greenewave
greenewave's picture

To find out more about the Imminent Collapse of the Global Economy, watch the YouTube video "Wall Street Thieves, Bailouts Galore, Broken America" at (

The United States economy is rotten at the core and has been stolen from the American people by the Wall Street Thives that drove the Titanic into the iceburg in the first place!!

32 minutes ago

KA-BOOM! Crash will be any day now! It is going to be like nothing else ever seen? here or anywhere else in history. God bless!


Tue, 11/16/2010 - 18:41 | 732609 ffart
ffart's picture

I could see $950 for gold toilet paper but bullion coins and bars ??? Who would sell at that price. What savings and investment vehicle are people going to flee to when bonds explode and the market makers need another multi billion dollar bailout. These people always assume that the status quo will go on, forever, in perpetuity.

Tue, 11/16/2010 - 21:42 | 733011 Percy Pickle
Percy Pickle's picture

You're right. The price of physical bullion hasn't changed much - at least on my dealer's price sheet this morning. Screw $950, check out FOFOA's call where he suggests the price of paper gold will eventually hit ZERO. I wouldn't worry too much about the current correction - it's probably been engineered so that GS can buy a larger chunk of America corporate on the cheap - using their Christmas money from the Fed. I know nothing. But hell this popcorn tastes great.

Tue, 11/16/2010 - 18:47 | 732624 ZeroPower
ZeroPower's picture

Gold - a decisive spot close below 1340.0 in our book targets to 965.0 minimum. And watch out below if 965.0 fails to hold.



Tue, 11/16/2010 - 19:26 | 732737 Victor Berry
Victor Berry's picture

According to the creationists, the universe is only 6000 years old.  Therefore, anything you think you see that is more than 6000 light years away is simply a figment of your imagination.

As for the price of gold, there is a price gap around the $400 level which will fill someday.  In the meantime, the price of gold could go to $4000 but who knows which will come first ... hyper-depression or hyper-inflation?

Tue, 11/16/2010 - 20:27 | 732890 brodix
brodix's picture

according to the cosmologists, the universe is only 13.7 billion years old, but that's nonsense as well. Redshift is proportional to distance, so an optical cause would be a far simpler explanation, than this whole Big Bang/Inflationary cosmology patch job that has to keep adding ever more fantastical nonsense to explain the discrepencies between theory and observation.

 Those dingbats decided a photon is an irreducible particle of light and can only redshifted if the source is actually moving away. They confused counting with measuring. The photons are not the clicks of the detector. They are the spaces between the clicks, the time it takes to build up enough energy to trip an atom to a higher energy level. So the more diffuse the light, the more time between clicks and the more redshifted the wave pattern.

Tue, 11/16/2010 - 23:24 | 733174 PhattyBuoy
PhattyBuoy's picture

Agreed. Light speed is NOT a cosmological constant ... nor is Planck's constant. The fact is the Universe is more Blue shifted as we move forward in time ... this explains the Red shift as we peer into more distant space.

The Universe has been in fact contracting - NOT expanding.

Tue, 11/16/2010 - 23:39 | 733187 honestann
honestann's picture

Yup, the big bang theory is yet another massive modern fraud supported the same way as all massive frauds.  Just like the global warming fraud, scientists who make observations, formulate theories and give alternatives to the official big bang dogma... are fired, shunned, defunded, whatever-it-takes.

At 8 years old, the big bang made enough sense to me that I didn't object.  By the time I was college age, I could see what had happened.  Part of the reason the big bang was made unquestionable official dogma was an attempt to make a peace-treaty offering of sorts with major religions.  We'll admit "the universe was created, and only dispute its age... 5000 years versus 20,000,000,000 plus or minus".  This destroys knowledge of one of the most fundamental facts of reality --- that the universe is eternal.  Any alternative requires the most complete and blatant violation of the single most fundamental scientific principle --- the fundamental principle of conservation [of fundamental existence].  I mean really!  One instant we have nothing (nowhere... there is no universe whatsoever)... and the next we have... everything.  Yeah, right.  Believe that and you must utterly abandon ALL science.  Which means, the religions are totally wrong, but are more consistent than scientists who believe such nonesense!

Probably the first problem I noticed was the clear, unambiguous, measured fact that incident light exerts a force on material.  So, I thought, we have interstellar atoms, molecules and microscopic dust everywhere in outer space, even between galaxies (in picoscopic quantities).  As the wavefront of a light emission passes over-under-around-and-through those atoms, it exerts a force upon those atoms, which moves them away from the object that emitted the wavefront.  The most fundamental principle of science, the most fundamental "conservation principle", basically says "you never get something for nothing, or vice versa".  Which means, some of the energy of the wavefront is consumed to move the atom.  Well, as any scientist knows, lower-energy light IS redder light..... so this process IS a red-shift.

As you say, this (and other very fundamental) processes are vastly more plausible ways to explain red-shift.  The BigBangTheory is a massive inferential leap from what is know... which is the red-shift (overall, the fainter the object, the further spectral lines are shifted towards the red).  Since "fainter" implies "further away", hence we all agree that overall or in general, wavefronts from further away are red-shifted more.

You are also correct to KICK BUTT about the dogma description of photons.  They've had to enforce this dogma on scientists to support the red-shift and other absurd insanities that further their agendas (including the notion that fundamentally and ultimately the entirety of reality is 100% and exclusively composed of probability).

The fact is, a great deal of light-energy is in fact "quantized".  But what does this mean?  In what ways is the light-energy quantized?  Well, consider this.  The electrons (whatever they are, ultimately) bound in an atom can only exist (endure) in specific "energy-states".  In an over-simplified elementary mental-picture form, the idea is sorta like this:  the distance of the orbit of an electron around an atom must equal 1, 2, 3, 4 or some other integer times the wavelength of the light-energy corresponding to the "electron".  Otherwise the wave will not be coherent or in-phase with itself.  All of this means, when electron-energy is released from an atom, it is released because the "orbit" of the electron jumped between one of the many integer orbits... and is thus quantized in this sense (and others).

However, to conclude that the light-energy (the "photon") so produced is contained in an infintesimal little bullet... is a massive (and ultimately absurd) leap of inference... which has now become a leap of faith due to the dogma imposed on modern science by the governments who control [and largely fund] universities.

As you noted, the same process occurs at the detector... at the "geiger counter" (or photomultiplier or avalanche photodiode "photon counter").  The light-energy can only be converted into a measurable signal by "knocking" an electron free from one of its quantized states.  So the detection process is always and inherently a quantized event, and would be regardless of whether the light-energy was localized in a tiny little spec, or was spread out in endless overlapping wavefronts.  Given the totally freaking obvious wave nature of light (see "airy disc" and much more), to confidently accept that light-energy is contained in tiny little bullets --- is patent dogma.

Sigh.  Yet another reason humans must get rid of government.  The entire future of mankind depends upon it.

There are only two ways to live... be a predator or be a producer.  This distinction IS the fundamental story of mankind.  Long, long ago, when the population of earth was small enough, naturally occurring processes did indeed produce enough eatable plants and animals to support humans behaving as predators.  Outside of a few unusual activities (like beavers buildings dams), pretty much all animal behavior was predatory, human included.

Then some very wise and smart humans noticed that seeds grow new fruit trees and vegetable plants... and started purposely removing seeds and planting them in rows so they could have plenty of food next year.  These were the first significant human producers.  When they made gardening tools to ease their work, they massively improved their productive efficiency.  With so much food easily available, the population of humans exploded... and the rest is obvious history.

Today, no way, no how could more than 0.1% of humans survive by predatory practices.  The natural processes on earth do not support anywhere even remotely near sufficient "goods" to support 7 billion humans, and almost certainly far less than 7 million humans.

By necessity, modern humans are producers.  However, the world is being run by predators!  How can this be?  The answer is fairly clear, but takes too long to describe here.  But here is an important hint to help you figure out the answer.  That is: destruction is inherently, metaphysically more potent and powerful than production.  The predators are destroyers.  They understand quite clearly how much time, effort, skills and resources are required to build a nice home... and how little time, effort, skills and resources are required to burn that home down ($1 and 10 minutes).  The predators know the mere threat of destruction is sufficient to convince most producers to pay them off.  Which is  precisely  what is government today.

Tue, 11/16/2010 - 19:59 | 732821 Implicit simplicit
Implicit simplicit's picture

"Nuclear fission produces energy for nuclear power and to drive the explosion of nuclear weapons. Both uses are made possible because certain substances called nuclear fuels undergo fission when struck by free neutrons and in turn generate neutrons when they break apart. This makes possible a self-sustaining chain reaction that releases energy at a controlled rate in a nuclear reactor or at a very rapid uncontrolled rate in a nuclear weapon."

The stock market use to be like controlled nuclear power, with a mishap now and then from lack of safety controls. Now, with leveraged instruments squared leveraged to eternity and HFT, the market is a nuclear weapon with uncontrollable consequences, and lack of safety controls.

Tue, 11/16/2010 - 23:33 | 733179 palmereldritch
palmereldritch's picture


Tue, 11/16/2010 - 20:20 | 732871 Patrick Bateman
Patrick Bateman's picture

Let's see. Gold and silver takes a tumble on the U.S. stock market, yet, once our market closes, they both constantly melt up. It doesn't matter if silver takes a $2 hit on our market, check out the open, they're really not losing at any kind of trend. The world knows (except us) that the dollar is failing and once it fails, at least temporarily, gold and silver will once again become the the standard of world currency. I wonder what the calorie content of a $100 bill is.

Tue, 11/16/2010 - 20:26 | 732883 max2205
max2205's picture

Bubbles = fun

Tue, 11/16/2010 - 21:54 | 733034 Sennett
Sennett's picture

officer bubbles is not amused

Tue, 11/16/2010 - 21:10 | 732961 laissez-faire
laissez-faire's picture

Are we really calling a 5% pullback after a 3 month 25% run "a bubble bursting"?  If you look at a long-term gold chart this recent pullback is barely visible.

Personally, I hope gold does go back down sub-$1000 again so I can continue to load up at better prices, but I think the prospect of that happening is slim-to-none.  There is just way too much money printing and impending chaos going on out there for me to even consider selling a single ounce or mining share at current prices.  Large Asian buyers will continue to buy aggressively into major pullbacks and keep prices from over-correcting.

The bond market on the other hand... yeah, stay away from bonds...

Tue, 11/16/2010 - 21:24 | 732978 ATG
ATG's picture

Time will always tell

22% of Gold open interest is speculative longs that can sell on a dime or margin call, taking gold down to 1045 in a flash crash splash...


Tue, 11/16/2010 - 21:39 | 733006 laissez-faire
laissez-faire's picture

I don't doubt for a second a sharp pullback is possible.  However, long-term I strongly expect gold to win the battle between the willingness of people to save money in US dollars versus the willingness of people to save money in gold.  That is why I'm not scared to buy into the pullbacks like in 2008.

Tue, 11/16/2010 - 21:58 | 733045 Bastiat
Bastiat's picture

Well I hope COMEX and LBMA have fun delivering into the demand all the way down, ATG.  Could get sticky especially with silver unless they just shook India down for a load.

Wed, 11/17/2010 - 02:20 | 733385 ViewfromUnderth...
ViewfromUndertheBridge's picture

ATG, you won't know 'til you bet.

Have the courage of your convictions.

Tue, 11/16/2010 - 21:27 | 732977 Fraud-Esq
Fraud-Esq's picture

"Part of the problem may be that this country has been living beyond its means since the 1960’s."

I actually don't agree. (I used to agree). Then, my eyes opened to the THEFT by the banking plutocracy since the 1960's of the entire nations productivity and enormous advantages in the world. The plutocrats bankers have actually STOLEN the military and enriched themselves with it too. 

The real problem is we haven't LIVED NEAR THE MEANS WE WERE CAPABLE OF since the 1960's. Minus the kleptocrats, we could have lived TWICE AS BIG as we did. I'm sure I could find an economist to prove this out too, after he's paid in full, like their economists are..


We have lived FAR LOWER, as a society, than what we were capable. We didn't even get pyramids out of the deal. The strongest empire the world has ever seen, a billion lost golf balls, credit derivatives, and yachts for frauds who don't know basic science. 


Tue, 11/16/2010 - 22:44 | 733122 honestann
honestann's picture

Absolutely correct.  That phrase is true only when applied to the aggregate (regular folks and the predator class).

I am always amazed that regular folks don't ask themselves the simplest of questions about their state and fate.  Like...

With the endless development of more and more efficient machines, equipment, tools and techniques...

--- Why are two wage earners today not able to afford as good a life as one wage earner just one generation ago?

--- Why do we have so much trouble getting by, when folks in the 1500s, 1600s, 1700s moved to a mostly empty, undeveloped continents of america without technology, without motors, without electricity, without modern tools, and without a nanny-government to "look after them"?

The answer is what you suggest... and more.

Not only do the predators-that-be, and the entire predator class steal 90% to 95% of what regular folks produce, but they vigorously destroy and thwart attempts of regular folks to become more productive.  Example: Anyone willing to start a new business in the USSA today is completely off his rocker... 'tis obviously made near-futile by the predators-that-be.

Plus, what percentage of the population actually produce any real product?  1%, 5%, 10%... certainly no more than that!  Hell, 50% work for government directly or indirectly.  Probably 25% push paperwork that is only necessary to comply with laws, acts, statutes, regulations and threats.  How many waste years and pay for "education" that renders them utterly incapable of creative or intelligent thought?

I've been a scientist, engineer, inventor, product-developer my whole life.  I know what humans can do --- and it is fan-freaking-tastic (to be technically precise).

If the predators did not control humanity, millions of us would be living in outer space today.

I do not jest.  I know better.  Remember this.  The USA went from zip, zero, nada, nothing... to landing men on the moon and returning them safely (several times)... all in 9 years.  That's right.  Check your history.  9 years.

Now here we are, after 50 years... and NASA claims it would take them 15 years to return to the moon.  And humans actually swallow BS like this?

The world is now controlled by the most evil, vile, mean, rotten, destructive predatory slime the world has ever known.  Humans could be living in the "promised land".  Productivity could be at least 100 times what it is today.  Hell, humans would be at least 10 times more productive simply by eliminating all the unproductive and antiproductive jobs, not even counting wise development and deployment of efficient technologies.

End government.  That is the only viable solution for humanity.  Humans definitely don't need government.  They never did.  And, in simple fact, government does not exist.  So-called government is a fiction, like SantaClaus or the ToothFairy.  Even fundamental law recognizes this by calling organizations of all kinds "fictitious entities".  And that they are, notwithstanding the absurdity of calling the nothingness of a fiction "an entity".

End government.
End government.
End government.

Really, since government doesn't exist, all that's required is to recognize government doesn't exist.  Then stop complying with those predatory humans who claim to "represent government" or "have government authority", and other babble.  In other words, just say no!

Tue, 11/16/2010 - 21:43 | 732986 ATG
ATG's picture

Federal Reserve usury adds up and compounds mordita subtracted from prosperity

Tue, 11/16/2010 - 21:49 | 733023 walküre
walküre's picture

Gold - a decisive spot close below 1340.0 in our book targets to 965.0 minimum. And watch out below if 965.0 fails to hold.


Now if we could only find sellers willing to part with the shiny at this price?

Everyone brush up your history books on the downfall of the former USSR.

The USSR had cheap prices for everything, prices were set and manipulated to make Russians feel better about the purchasing power of their meager incomes.

Only trouble was that you couldn't find any retailers selling the good stuff for the set prices.

The black market was alive and well and Russians that had something to barter with, had no problem living on caviar and champagne.

So all you Deflationists, Dollar slaves go out there and try and convert your soon to be worthless paper into hard assets while you can.

Gold $965 .. only on the official market board. Nobody will sell for that unless they're so desperate that they can't hold on to it.

Silver at $25 is already cheaper than a family's outing at McDonalds.

The typical Christmas present among family is worth about $50 or 2 ounces of silver.

Do you understand what I'm saying?

Tue, 11/16/2010 - 22:13 | 733074 honestann
honestann's picture

Oh yeah!  Xmas came early for me!  I can't believe I got the chance to convert the last of my FederalReserveNotes into gold and silver at super-discount prices earlier today.

Those who know I already have lots of gold and silver think I'm insane when the prices drop like today.  Boy are they stupido!  They've had the same reaction for years, even as my $300 gold passed $1300.  Sheesh.

You are so right.  I cannot BEAR to sell any of my gold or silver.  I am frugal no matter what, but it is soooo much easier to squeeze $1400 in FederalReserveNotes out of me than 1oz of gold bullion.

The reality and purity of real, physical gold and silver bullion in my hands is... palpable, even visceral.

Wed, 11/17/2010 - 02:23 | 733389 ViewfromUnderth...
ViewfromUndertheBridge's picture

Dickens knew something...

Tue, 11/16/2010 - 22:05 | 733061 themosmitsos
themosmitsos's picture

What bothers me about the asset class bubble analysis immediately above the Milky Way pic, is the disingenious nature of American analytics towards the S&P. Oh sure, if DXY breaks 79, EURUSD will go from 1.35 to 1, if gold breaks 1340 it'll do 965 min, but if the S&P breaks 1158? 1095. Bullshit. Not to mention that ... if DXY is spiking, HOW are rates going to spike TOO, in the CURRENT environment? Do simple math as to what a 5% 10yr means for US interest rate payments before ridiculing Ireland et al. If rates spike in the CURRENT environment, it's liekly that BOTH the S&P *AND* the DXY collapse entirely. Just saying.


Astrophysics ... Honestly and bluntly, I find it entertaining to read all the conjecture regarding the recent data and images. Such a .... self-centered viewpoint, when the answer's staring you right in the face. Plus ... refraction. ;)

Tue, 11/16/2010 - 22:06 | 733064 honestann
honestann's picture

Has an organization ever strayed as far from accomplishing its goals as the Fed?

The government of the USA.


Tue, 11/16/2010 - 22:10 | 733070 Bastiat
Bastiat's picture

Well said -- especially since we don't know if the Fed has strayed at all since we don't know its goals.

Tue, 11/16/2010 - 22:36 | 733110 metastar
metastar's picture

Yes, matter in the universe must be finite. Dollars in the money supply can be infinite. But then again, even infinity has a cardinal value to which I am sure the FED is looking to inflate.

For more fun FED math facts see:


Tue, 11/16/2010 - 23:55 | 733219 CBTeas
CBTeas's picture

As long as Bernanke, Obama and Congress use a rising stock market as the only litmus test for successful economic policy, we will remain on a currency crash course.

Ever since the days of Greenspan and Bubblevision, it seems that the US has stayed on this path of stock market euphoria as the only measure of policy success. Why are the Wall Street brats the only arbiters of sound policy?

Wed, 11/17/2010 - 00:40 | 733287 mhjhnsn
mhjhnsn's picture

Actually, "preserving the value of the dollar" was not that big an issue when the Fed was created in 1911-1913---the gold standard managed by London took care of that.  The main impetus to create the Fed was to regulate the banking system and have a lender of last resort so we would not have another near-death experience like the Panics of 1907 and 1893.

Wed, 11/17/2010 - 01:06 | 733331 blindman
blindman's picture

at any point in time, eternity, now, the future is an infinite

number of potentials, speculations or bubbles.  some are

possibilities and some are not.  of the possibilities some

are more desirable than others,  but that depends on who

you are and how you are positioned should any particular bubble

be sustained by the mind set of the group.  or the institution as

it occupies mental space in the mind set of the individual.

and the mediums of exchange, value of the currency, are based on

viable and sustainable speculation and expectations. 

the gamma bubble is a manifest spherically diverging galactic emission.

the financial "bubbles" are manufactured false visions and speculations

contrived to facilitate usury and wealth extraction by institutional entities

that could not extract the wealth they desire openly so they need to

obfuscate, confuse and misrepresent their motives, means and misstate

their desired ends.  popular support would not accrue in their favor and

they know it.  we need an honest vision and articulation of it .  then

the false bubbles will collapse and the true speculation will become

a goal and it's fruition will be certain.   imo.

Wed, 11/17/2010 - 03:19 | 733408 twittering as s...
twittering as stocktradr's picture

wall street. “contrived to facilitate usury and wealth extraction by institutional entities”

a trader trading a complete trading plan continuously makes more money than one loses facilitating the wealth extraction from wall street.

pretty simple.

twittering as stocktradr

Wed, 11/17/2010 - 09:03 | 733613 Downtoolong
Downtoolong's picture

These newly discovered gamma-ray bubbles extend out roughly 50,000 light-years or about half the diameter of our Milky Way galaxy.


.. or roughly equal to the size of a Wall Street trader’s ego. Unfortunately from the height that Bernanke views the world, even these large formations take up too narrow a field to be seen.  

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