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You Know A Double Dip Is Imminent When...

Tyler Durden's picture


With endless lies bombarding the average American from all sides seeking to instill a false sense of calm that all is good (but, but, the market is up, up, up and GM is IPOing today), it is wise to step back and consider the common sense signals that a double dip is if not here, then arriving on the next much delayed flight.

From the Churchill Financial Group:

The prospect of a recession redux in the US continues to unnerve global equity investors. While we're doubtful such an outcome is likely, we didn't want to leave our readers without appropriate guidance as OTL heads for its two-week August hiatus. So we've come up with a few tell-tale signs of a potential double-dip for your consideration.

But first, take a look at the indicators pointing to some kind of transition in the capital markets:

  • Very slow GDP growth, so helpful to bonds (see our Chart of the Week), has been toxic to public equities. Corporate debt is hotter than it's ever been, while the stock market (nicknamed "the bond market's idiot kid brother" in this week's Barron's), has lost most of its gains for the year.
  • The US high-yield market is poised to issue over $30 billion in new paper between now and the end of August; a time when bankers typically are kicking back in Kennebunkport.
  • The summer surge comes on top of year-to-date junk volume of $150 billion for 349 issuers. That's roughly double last year's comparable numbers of $80 billion and 190 issuers, putting us already ahead of 2009's full year record results.
  • The Fed's "ease-to-please" rate policy has helped investment grade issuers as well. By pushing out the forward curve, continued money loosening has produced some eccentric corporate bond outcomes. IBM (A+), for instance, just issued three-year notes at 1%. That's almost free money, after taking into account the little inflation that's out there.
  • But that's mezz pricing compared to J&J's (AAA) ten- and thirty-year bonds in the market. Those beauties, each $550 million, are price-talked at 43 and 68 bps, respectively, over comparable Treasuries. The all-in spreads are expected to be the lowest in history. In fact, Deutsche Bank reports that the ten lowest-yielding new US corporate issues ever have been sold in the past 14 months.

So are we headed for a downturn? Here are a few clues to watch out for.

You know we're headed for a double-dip when:

  • your parents start referring to 2009 as "the good old days."
  • your CFO starts making finger-quotes when he refers to "corporate earnings."
  • what you thought was your cable bill, turns out to be your 401k statement.
  • instead of giving away toasters your bank starts selling them.
  • your mortgage shows up on eBay.
  • your accountant starts making finger-quotes when he refers to your "net worth."
  • you buy $50 of GM stock, and are named to the board.
  • the family dog asks for a severance package.
  • your spouse starts making finger-quotes when referring to "our vacation."
  • your recently graduated son moves back into your house...with his roommate.
  • you start making finger-quotes when referring to your five-year old's "allowance."
  • your parents move to Greece.

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Tue, 08/17/2010 - 14:49 | 526569 realtick
realtick's picture

- Starbucks changes its name to Starcents

- Zero Hedge changes its name to Less Than Zero Hedge

Tue, 08/17/2010 - 15:12 | 526668 homersimpson
homersimpson's picture

or "sub-zero hedge"

Tue, 08/17/2010 - 15:22 | 526703 realtick
realtick's picture


Tue, 08/17/2010 - 15:30 | 526730 No Mas
No Mas's picture

"sub-prime hedge"

Tue, 08/17/2010 - 17:57 | 527087 knukles
knukles's picture

Structured Zero Value Sub Prime Equity Layer AAA Rated CDO Un-Hedged Offered in Priate Equity Fund of Funds Feed at 2/20. 

God, I love this country!


Tue, 08/17/2010 - 15:40 | 526749 Pladizow
Pladizow's picture

When "Mad Money" with Jim Cramer changes its name to "Had Money" without Jim Cramer!

Tue, 08/17/2010 - 16:21 | 526856 Cleanclog
Cleanclog's picture

Bravo!  Love it!

Tue, 08/17/2010 - 17:00 | 526957 papaswamp
papaswamp's picture

+1 for both the avatar and 'Had Money'

Tue, 08/17/2010 - 16:58 | 526955 AchtungAffen
AchtungAffen's picture

Foodruckers changes name to Buttfuckers.


Message brought to you by CostCo.

Tue, 08/17/2010 - 14:46 | 526579 Rogerwilco
Rogerwilco's picture

Another sign is real estate agents offering sage advice like:

"in today's challenging market, sellers have to be willing to lower their price if they expect to get top dollar".

Tue, 08/17/2010 - 14:49 | 526589 Mitchman
Mitchman's picture


Tue, 08/17/2010 - 15:30 | 526733 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

Doublespeak at its best. Wouldn't more appropriate be "sellers have to be willing to lower their prices even for a dollar?" 

Tue, 08/17/2010 - 15:33 | 526738 Gully Foyle
Gully Foyle's picture



"After three years of a sluggish economy and little action in the real estate market, Ken and I needed to rethink how we spend our days. Yes, we are still Realtors. We LOVE real estate! But, it's not the ONLY thing we love to do, and until the market improves, we need to find, as they say, 'other streams of revenue'."

Tue, 08/17/2010 - 14:51 | 526592 Mitchman
Mitchman's picture

When you get an NSF notice from your bank you don't know if it's you or them...

Tue, 08/17/2010 - 16:27 | 526869 doggings
doggings's picture

haha yea there was an email went round that said something like this

Dear bank manager I received a cheque back from you this morning that said "returned due to lack of clear funds" - did you mean me, or you?

t'is about right



Tue, 08/17/2010 - 14:51 | 526593 redarrow
redarrow's picture

The  minneapolis fed head comes out and says that the fed buying more government debt should not be viewed as the economy being worse than it is. Of course, the fed just buys when it feels like and randomly for no reason at all. Its its all warm and fuzzy.

Tue, 08/17/2010 - 14:53 | 526603 Apostate
Apostate's picture

You should feel warm and fuzzy, comrade.

The Fed is working together with the great people of Soviet Amerika to create a new era of infinite prosperity.

Buy GM. 

Tue, 08/17/2010 - 14:59 | 526623 redarrow
redarrow's picture

The cherry on the cake will be if they pull out of the IPO stating unfavorable market conditions as KKR did last week. 

Tue, 08/17/2010 - 15:17 | 526688 Apostate
Apostate's picture

Seeing as their entire market cap was created by THEFT, they're just waiting for more thieves to dump loot into the market.

Complete madness will be "favorable conditions" for the last rape of the economy.

Tue, 08/17/2010 - 15:25 | 526709 Idiot Savant
Idiot Savant's picture

Nah, the ramps are ready and in place.

Tue, 08/17/2010 - 14:51 | 526594 Segestan
Segestan's picture

Non-representive tax payer control over Industry, finance and housing , unemployment through the roof, trillion dollar spending by a bankrupt liberal establishment, mass illegal immigration.... but hey let talk double dip crap...oh did I forget the GOM lies!!

Tue, 08/17/2010 - 14:58 | 526617 tunaman4u2
tunaman4u2's picture

I love the POT buy out

AWESOME, food prices are going to go through the roof & POT is going to profit hugely on the backs of the masses

What a wonderful world we have. At least with XOM we can choose to ride a bike or walk. 

Screw this, I'm buying a huge field & growing crops... ear of corn $5 each. Economic recovery is here! 

Tue, 08/17/2010 - 14:59 | 526622 LostWages
LostWages's picture

When you get a pre-declined credit card application in the mail.

Tue, 08/17/2010 - 16:07 | 526815 Horatio Beanblower
Horatio Beanblower's picture

Excellent. +1.

Tue, 08/17/2010 - 18:02 | 527102 knukles
knukles's picture

Honestly awaiting a pre-approved credit card for my dog Gizmo. 

And come to think of it, maybe open an account on AOL with screen name Gizmo, do a few clicks here and there, link into some upscale advertising (Tiffany, etc.) and maybe, just maybe sombody will send a card and I can contact the WSJ for a front page, center column.

Oh, the caninity of it all....

Martha, get the popcorn out!

Tue, 08/17/2010 - 15:01 | 526628 docj
docj's picture

When "Recovery Summer" bleeds into "Recovery Fall" - or "Recovery Fail" - or something.

Tue, 08/17/2010 - 15:05 | 526639 MichaelG
MichaelG's picture

Timothy Geithner starts using finger quotes when saying anything at all.

Tue, 08/17/2010 - 18:04 | 527105 knukles
knukles's picture

Like referencing the size of his manliness or his credibility? 
Pick one, don't worry, be happy.

Tue, 08/17/2010 - 15:12 | 526648 suldog
suldog's picture

When Geithner (or any other moron who has never written a paycheck, filed any of the half-zillion reports to the various overstaffed, incompetent, government bureacuracies [not including a tax return]) writes an Op-Ed about "the recovery".

F*ing morons.  It is staggering.

Tue, 08/17/2010 - 15:12 | 526664 homersimpson
homersimpson's picture

...when in a bathroom you reach for the toilet paper only to realize you've ripped off some dollar bills.

Tue, 08/17/2010 - 15:17 | 526686 Misean
Misean's picture


Tue, 08/17/2010 - 15:31 | 526734 Racer
Racer's picture


But they would probably ban their use because they will block the toilet... they won't be any good for wiping your .... either!

Tue, 08/17/2010 - 15:45 | 526765 homersimpson
homersimpson's picture

Guests say it's colorful and stylish but it's rough on their sensitive spots.

Tue, 08/17/2010 - 21:15 | 527386 ChopChop
ChopChop's picture

They are selling the 100 trillions ones on ebay, seriously about getting one as a daily reminder of how I have to prepare... for just a few bucks!

Tue, 08/17/2010 - 15:13 | 526676 the not so migh...
the not so mighty maximiza's picture

When the Winter of Winning is upon us.


Tue, 08/17/2010 - 21:13 | 527382 JR
JR's picture

Ahhhh, yes.  The winter of our dis-connect.

Tue, 08/17/2010 - 15:14 | 526677 Misean
Misean's picture

The utility company is out installing coin op locks on your electric and water meters.

Tue, 08/17/2010 - 15:15 | 526678 plocequ1
plocequ1's picture

Today's not that day. Rally on Gents.

Tue, 08/17/2010 - 18:07 | 527111 knukles
knukles's picture

Oh hush, Turd.

You know its all coincidences.  Like the shots fired at the Turkish Embassy in Tel Aviv a few minutes ago. 

Come on baby, light my fire, gonna set the night on......

Tue, 08/17/2010 - 15:17 | 526692 binomial
binomial's picture

... when oil goes to $100 and you don't care because you're not driving anywhere anyway.

Tue, 08/17/2010 - 15:19 | 526695 hedgeless_horseman
hedgeless_horseman's picture

You know we are headed for a double dip when you see a bumper sticker that says:

"W" the Recovery.

Tue, 08/17/2010 - 15:32 | 526739 Reductio ad Absurdum
Reductio ad Absurdum's picture

GM is IPOing. That must be why MTLQQ (stock for the former now bankrupt GM) has doubled over the last four days!

(Just a reminder: MTLQQ has almost no intrinsic value; worth about 0.02 so don't buy it thinking that it's the new GM.)

Tue, 08/17/2010 - 15:33 | 526740 Gully Foyle
Gully Foyle's picture

I wish they would stop the Double Dip lie and name the beast for what it is DEPRESSION.

Tue, 08/17/2010 - 15:35 | 526742 Leo Kolivakis
Leo Kolivakis's picture

No double dip, just ask Madonna who recently traveled to Mykonos. You all need a "holiday" from this this doomsayer stuff!

Tue, 08/17/2010 - 15:40 | 526752 Gully Foyle
Gully Foyle's picture

Leo Kolivakis

Did they airbrush the shit out of that old skank or what?

Oh wait, I get it it's an analogy to the fucked up illusion of an economy.

Good job thinking outside the box.

Tue, 08/17/2010 - 16:32 | 526888 Burnbright
Burnbright's picture

My thoughts exactly.

Tue, 08/17/2010 - 18:40 | 527185 Treeplanter
Treeplanter's picture

Didn't she find Susan yet?

Tue, 08/17/2010 - 15:34 | 526744 Trichy
Trichy's picture

...when Ben is the only one with a helicopter

Tue, 08/17/2010 - 15:35 | 526745 101 years and c...
101 years and counting's picture

.....when Madoff wins a Nobel Price for Economics

Tue, 08/17/2010 - 15:41 | 526755 overqualified
overqualified's picture

When the most of CON-gress lobbysts will be Chinese

Tue, 08/17/2010 - 15:50 | 526771 Turd Ferguson
Turd Ferguson's picture

When douchebags like Jeremy Seigel proclaim the QE is good! What a fucking idiot.


The Fed Is Not Out of "Silver Bullets" by Jeremy J. Siegel
Friday, August 13, 2010

The Fed’s move on August 10 to “keep the balance sheet of the central bank stable” and offset the run-off of mortgage-backed securities with Treasury purchases was just a baby step.  Much stronger measures can and should be taken to combat the economic slowdown.

As readers of this column know, I am a strong supporter of Ben Bernanke, Chairman of the Federal Reserve Board.  I think his bold measures to insure the liquidity of the banking and financial system saved us from repeating the misguided policy that led to the Great Depression of the 1930s.  This is why I was disappointed in the Fed’s move on August 10 and Bernanke’s testimony July 21 before Congress, one of the Fed’s ritual semi-annual appearances that go back to the 1970s.

During his meetings before Congress, Bernanke responded to a question by Senator Bunning of Kentucky asking whether the Federal Reserve “was out of bullets” in its fight against the faltering economy. Bernanke responded, “I don’t think so.” Later he noted other measures the Fed might use to stimulate the economy, but only said “there is some probability they will be effective.”

Bernanke should not hedge.  When you are the head of the world’s most powerful central bank, expressing doubt about the Fed’s effectiveness is a mistake. It is mandatory that the policymakers and central bankers display confidence in their policy tools.  And the historical evidence is that Bernanke has every right to believe the Fed can still be very effective.

Quantitative Easing

In last month’s column I recommended that the Fed consider reducing the interest rate it pays on bank reserves to zero and engage in quantitative easing to help the economy emerge from the current soft patch.   Quantitative easing, or QE as it is often called, occurs when the central bank expands the quantity of Federal Reserve credit by increasing the reserves in the banking system.  QE is employed when the normal policy instrument of the Fed, the Federal Funds rate, is at or near zero.

In fact, Bernanke had already engaged in significant quantitative easing during the financial crisis in 2008 by supplying the banking system with over $1 trillion of reserves in excess of the banks’ statutory requirements.  These reserves were far more than are required to bring the Fed Funds rate down to its current 0% to 0.25% level, a range that the Fed adopted in December 2008.

Some argue tha,t since banks already hold more reserves than required, additional reserves would not have any further effect on lending or economic activity.  But that conclusion is not warranted.  Banks hold large excess reserves because they wish to show regulators and investors a high level of liquidity. 

This does not mean that banks would hold unlimited excess reserves.  In fact, banks are not happy earning near zero interest on these reserves, nor are investors satisfied with similar rates on their money market funds.  Placing more zero-interest reserves into the banking system will tempt more banks to make loans where the profit margin is much higher.

Although the Fed’s main policy tool, the Fed Funds rate, works on short-term interest rates, QE has the potential to lower longer-term rates, especially if the asset purchases are concentrated in long-dated securities.

In a recently published article, Taeyoung Doh, a research economist at the Federal Reserve Bank of Kansas City, gives evidence that asset purchases may be a much better instrument in lowering long-term rates than giving guidance in the FOMC directives, such as the “extended period” language which Wall Street watches so attentively in the statements following Fed meetings.

Japan’s Experiment

Those who object to quantitative easing point to Japan’s alleged failed experiment with QE from March 2001 to March 2006.  During that period the Bank of Japan increased reserves markedly, yet that did little to improve Japan’s economic prospects.

But a close look at the Japanese data does not support this pessimism. Between 2001 and 2006, deflationary forces were arrested in Japan, the economy-wide price level remained constant, and annual GDP growth did increase by about 0.5% from the average of the previous decade.  I admit QE did not lead to robust growth, but Japan’s slow growth over the last two decades is more related to structural problems in the Japanese economy and the rapid aging of the population, not to a bubble that burst more than 20 years ago.  Furthermore, the effectiveness of the Bank of Japan’s QE policy was reduced by its implementation that began well over a decade after the markets collapsed in the 1990s.  This lag allowed deflationary pressures to sink much deeper into their economy than now exists in the U.S.

One of the reasons the Bank of Japan finally abandoned QE was that the Japanese public was very uneasy about unlimited expansion of the money supply.  Most Japanese still remember the post World War II inflation that devalued the purchasing power of Japanese yen by more than 100 to 1, and they feared that QE could bring about another inflationary episode. 

The U.S. economy is far better suited to QE than Japan’s. Serious deflationary forces have yet to take hold, while inflationary expectations have been held well in check. Adding reserves will induce banks and investors to buy longer-dated and higher-yielding assets, reduce long-term rates, and spur more lending by the banks.


The Fed is far from out of silver bullets.  Fed Chief Bernanke must be confident in the potency of all the Fed’s policy tools, not just the Fed Funds rate.  Quantitative easing is a viable policy and, when combined with a reduction in the interest rates on reserves and the continued support of the asset-based securities markets, the Fed can deliver a potent combination of policies to stimulate the economy.


Tue, 08/17/2010 - 15:52 | 526781 Nihilarian
Nihilarian's picture

...when the only spectacles you can afford come paired with a movie ticket to Pussy Galore 3D.

Tue, 08/17/2010 - 15:53 | 526783 Leo Kolivakis
Leo Kolivakis's picture

Unfortunately, double-dipsticks abound...can't make this shit up:

Tue, 08/17/2010 - 16:03 | 526811 Turd Ferguson
Turd Ferguson's picture

This is much more interesting, Leo. From the same page...

Tue, 08/17/2010 - 18:23 | 527144 Leo Kolivakis
Leo Kolivakis's picture

Excellent, thanks for this clip. I've written on NJ pensions and I think he's on the right path.

Tue, 08/17/2010 - 18:27 | 527139 knukles
knukles's picture

Gay Bar Next to NYC Mosque!


Put a pork BBQ on the other side and a Jewish Deli across the street for Christ's sake. 
Farm Out, Right Arm and Outta State, Dude!

I love the smell of pissed off neighbors in the morning!
Equal Rights!
Fry Everybody's Circuits.

Radical Talmud Scholar and Christian Reconstructionist book stores!  Armageddon Tickets on Sale Here, only 100 Raptures Accepted!

Amerika, Love it or Go Fuck Thyself, Neighbor.

Oh God, We are soooooooooooooooo Screwed.

Wed, 08/18/2010 - 07:29 | 527788 Headbanger
Headbanger's picture

And put a Catholic center with bingo three nights a week next to the Jewish deli!

Tue, 08/17/2010 - 15:58 | 526799 william the bastard
william the bastard's picture

When Democrats keep the house and senate

Tue, 08/17/2010 - 16:07 | 526817 traderjoe
traderjoe's picture

This glib analysis offends my sensibilities. Recently, 30,000 people in Atlanta waited in line up to 3 days for the chance to get an APPLICATION to get on a Section 8 WAITING LIST. It was a total cluster fuck. I showed my wife the video as an example of what the future might look like with food lines. Watch it to see how the people are systematically shamed and treated like cattle.

We've spent or guaranteed trillions in private losses and all we get is 1% GDP growth? 9.5% U-3 unemployment. Shameful. 

We're in a full-blown depression. There is no exit. It will get ugly. I don't wish anything on anyone, but this sort of BMW-Driving-Golf-Club-Suburban money manager with no food, gold, ammo, supplies stocked up will get one helluva surprise...

Tue, 08/17/2010 - 16:50 | 526932 trav7777
trav7777's picture

Hold up, so waiting in line for a FREE HOUSING HANDOUT is "getting treated like cattle"???

The future with food lines will only look like this if the people IN the lines look like this.

Compare Katrina flooding in New Orleans versus places with people who don't look like the people in New Orleans.  Or the Kobe quake.  Or the Indonesia Tsunami...

How the fuck is offering people a FREE HANDOUT to move their criminal, welfare leeching, nonworking asses into someone's neighborhood so they homies can piss on the neighbor's lawns and run the car stereo at maximum volume for 2a parties "systematic shaming"?  Those people in those lines SHOULD be ashamed - of THEMSELVES.

Tue, 08/17/2010 - 16:58 | 526950 chet
chet's picture

Just a teeny touch of racism poking through there, trav.

Tue, 08/17/2010 - 17:52 | 527074 traderjoe
traderjoe's picture

You really needed to actually have watched the video. When anyone is treated this way, they will remember, and at some point snap. Remember the LA riots?

Irrespective of your view on Section 8 housing, or welfare in general (I have some problems with the programs too), but:

1. The wait-list hadn't been open in like 10 years, what was the rush to give out applications in that manner? Why not just have them available for a month at the office? Remember, this was just to pick up an application, you were supposed to fill it out and return it at another time. 

2. The ED of the agency thought the event 'went well'. By what measure?

3. The lines moved several/shifted times - effectively confusing people and leaving their time spent as useless. 

4. After having set up a portable fire station, couldn't you have realized that there was a better way to do this?

5. The police handing out applications from the top of their car reminded me of the 3rd world deliveries of bags of rice. That's the best we can do?

It revealed to me the systematic oppression and 'keeping down' of 'lesser citizens'. The entire thing was organized to minimize human/individual dignity. Whatever you think of Section 8, that sort of oppression creates an eventual powder keg. No one deserves to be treated that way. 

Tue, 08/17/2010 - 19:42 | 527282 nmewn
nmewn's picture

"It revealed to me the systematic oppression and 'keeping down' of 'lesser citizens'. The entire thing was organized to minimize human/individual dignity. Whatever you think of Section 8, that sort of oppression creates an eventual powder keg. No one deserves to be treated that way. "

And yet they keep voting for the people who keep them in this position.

Stockholm Syndrome?

Tue, 08/17/2010 - 18:48 | 527199 Treeplanter
Treeplanter's picture

They could have used an air conditioned hall and put a little planning into it.  I guess the people in charge were out playing golf.  Even if section 8 people are totally dependent on handouts they were made that way by the progressives.  

Tue, 08/17/2010 - 20:27 | 527327 Iam_Silverman
Iam_Silverman's picture

"They could have used an air conditioned hall and put a little planning into it. "

I'm sure their budget has plenty of extra money for just that kind of stuff.  Should they have also had entertainment and snacks too?

It's an entitlement program.  It should be run as lean as possible.

Tue, 08/17/2010 - 23:28 | 527551 Blano
Blano's picture

They probably didn't think hardly anyone would show up.  After all, this is Recovery Summer, remember??

Wed, 08/18/2010 - 09:53 | 527959 Iam_Silverman
Iam_Silverman's picture

"After all, this is Recovery Summer, remember??"

Yup.  Whooda thunk?

Wed, 08/18/2010 - 02:14 | 527672 Paul Bogdanich
Paul Bogdanich's picture

"Hold up, so waiting in line for a FREE HOUSING HANDOUT is "getting treated like cattle"???"


Two things.  The CEO of Google says your anominity is toast so they will know who you are.  That's one.


Two, if enough people get that treatment your indignation might stir them to  anger and this being America you can bet that of all their assets they lost they will still have a gun. 


I'd watch my festering gob were I you. 


For the record I am doing fine financially and abhor violence but a lot of the people you dis may not be similarly inclined.  The pain out there is real my friend and you best stop mkaing fun of it.  Like people enjoy having to apply for section 8.  You're just ignorant.   

Wed, 08/18/2010 - 09:58 | 527971 Iam_Silverman
Iam_Silverman's picture

"Two things.  The CEO of Google says your anominity is toast so they will know who you are.  That's one."

If you have a high-speed internet connection, chances are your DSN is static.  Most boards have ways to track which DSN posts which messages.  It has been this way for a long time.  Hiding behind a screen name has always been an illusion.

"anywayLike people enjoy having to apply for section 8.  You're just ignorant.  " .

True, but they could at least behave like civilized adults.  My relatives have worked with Section 8 "entitled" renters before.  Never again.  I hope one moves next door to you.  They seem so pleasant, don't they?

Tue, 08/17/2010 - 16:55 | 526941 chet
chet's picture

That was a crazy event, to be sure.  The way to avoid this is take applications on-line only for a week.  Everyone who applies gets an equal chance of getting one the slots on the list via lottery.

Interesting to think about how many of these scenes we're avoiding right now due to technology.  The only reason we don't see breadlines right now is because we have plastic food stamp cards.

Keeping people dispersed in a great control mechanism for the government.  Apparently Atlanta didn't know this, but they will next time.

Tue, 08/17/2010 - 17:40 | 527052 New_Meat
New_Meat's picture

Chet +1

"The only reason we don't see breadlines right now is because we have plastic food stamp cards."

Just re-read Roth's "Depression Diary" (ABE search above), vivid stories of people queuing up to get their maximum 5% withdrawal.  I continue to think that about bank ATMs as well.  What happens when ATMs don't work or the debit card doesn't work at *bux?

But, y'know, Ahnold is trying to crack down on the "misuse" of his plastic at Cali casinos.  After all, the amount of money in the debit account is sized to meet the family's "minimum" needs to survive; guess that includes Michelle's favorite ice cream as well.

Who is servicing all of those cards?  Visa?  Might be why there have been recommendations for same.

And avoiding concentration of a crowd?  No probemo, the community organizers who would work up the crowds are suppressing any action.

Gotta wait for the do-nothing congress for the riots, next summer.

- Ned

Tue, 08/17/2010 - 20:23 | 527324 Iam_Silverman
Iam_Silverman's picture

"Just re-read Roth's "Depression Diary""

I agree, an excellent first-hand view of the times, but from a little different perspective of what many are used to.  Very good book for the times.

Tue, 08/17/2010 - 16:11 | 526833 william the bastard
william the bastard's picture

When Blago appears as a contestant on "The Apprentice".

Tue, 08/17/2010 - 17:43 | 527057 New_Meat
New_Meat's picture

Blago just convicted--1 count of "quotation fingers" 'lying to the FBI'.

- Ned

p.s. what symbol should we use for "quotation fingers"?

Tue, 08/17/2010 - 16:16 | 526843 Sudden Debt
Sudden Debt's picture

I presented next years budget today. You should have seen my CEO's face when I talked about the challenges of next years recession.

I had to go on my knees so to speak and make changes where we would AT LEAST grow 7% just to cover the costs (I though we already trimmed our headcount to the max).

"You do know we still operate at a loss do you?"

I went into hypnoses mode because my BI tools all showed green numbers these last 7 months. When I asked about it, his response was as scary as hell: "That's what we want sales to see, so they keep on being optimistic". Guess I was working with the wrong cubes all along. The same ones accounting uses.

I already thought it was a bit strange, because every manager from different job levels (I'm 8 out of 10) and most manager around me are 5 and 6, all of them get different numbers out of the same bookmarks.

In the past, you also could get clearance to see all the group figures. Now it's like asking for a full clearance pass at fort knox.

I think I know about 30% of everthing that happens in the company (it used to be 99%) and of all the crap I've seen these last 3 years I could write a dozen books.


Tue, 08/17/2010 - 16:30 | 526878 Cleanclog
Cleanclog's picture

Fascinating and believable.

The depth and breadth of lying by "leaders" of companies, governments and the man on the street is absolutely staggering.

Americans could have dialogue and care about Wikileaks or the ongoing impact of ZIRP but apparently we'd rather focus on Lindsay Lohan's jail term and Kelsey Grammar's love child.  It seems no one believes they can positively impact a damn thing so they've just given up and into banal distraction.  

Despite Orwell and others, I really did not imagine this was possible 20 years ago.

Tue, 08/17/2010 - 17:05 | 526968 chet
chet's picture

I realized the other day that I'm "lying" to my wife to some extent.  I was sitting on the couch with my father and decided to reveal the extent of my worries about the economy over the next year.

I realized that I was dropping my voice very quietly, and realized that was because I haven't discussed these fears with my wife much.  I don't want to scare the crap out of her.  So I've been trying to sock money away and stockpile what I can without sharing the extent of my fear.

A lot of this dishonesty in companies and the like may be people who can't bring themselves to speak the truth out loud.  In business especially, everyone is supposed to be endlessly optimistic.

Tue, 08/17/2010 - 17:42 | 527056 Cleanclog
Cleanclog's picture

Good point.  I was recently in Costa Rica with my Dad and was trying to explain to him how ominous it was that every other piece of property and storefront were "Se Vende" (for sale) and how it was another example of the overreach that occurred globally in recent years.  That and the 250 new zip line facilities put in for tourists.  

Like you said, I found myself whispering and concerned that I would offend Costa Ricans despite my point being global.  Some European tourists asked if I really thought there was over reach.  I couldn't believe it as they were from Spain and Portugal.  We had an interesting, but muted, conversation about the housing markets there too.

And you're correct that our "leaders" are often really just our "cheerleaders".  Not making difficult decisions, but trying to keep us engaged and believing of our "roles" as employees or consumers.  A lot of psychology, but it really isn't working anymore.  And I think the long term damage will be worse than cynical.

Tue, 08/17/2010 - 17:18 | 526998 Caviar Emptor
Caviar Emptor's picture

That's critical to keep in mind for the next time that little voice says "Hmmm....That doesn't add up!" The stonewalling of America. 

Tue, 08/17/2010 - 17:04 | 526964 walküre
walküre's picture

Enron and Worldcom set the benchmark.

They were both textbook cases and believe you me, CEOs of all stripes have studied their methods since.

How bad can it be when all reports are equally manipulated and falsified?


Tue, 08/17/2010 - 17:28 | 527022 Caviar Emptor
Caviar Emptor's picture

+10. It's great watching tapes of Ken Lay talking to his troops and stockholders circa spring 2001 as water was reaching his Gucci sock suspenders. It's even greater yet hearing the tapes of his energy traders, 22 year old guys ordering California utility companies to shut down power just to send their energy arbs through the roof and laughing their asses off with their buddies about it! MSM always told us it was "rolling blackouts" due to incompetent state government. It's sweeter yet reading gushy thank yous from GW Bush and GHW Bush to Ken also circa 2001. 

Tue, 08/17/2010 - 18:16 | 527131 New_Meat
New_Meat's picture

@sudden, I'm on the road, working with one of several highly competent sales guys, excellent record.  They have been through a reorganization, restructure their regions, and oh, by the way, quota is up 100%.

Massive drive to gigo, forced all the way down.  Each level of management has sniffed the outcome and bought Kool-Aid.  (sometimes I open up my bag and offer cherry, lemon-lime, and grape.  The ones who will survive take a packet.  Almost Omerta)

And the limit on information?  -- dang, I need a 'wink' emoticon that is not humorous, but rather, acknowledging.

tough times

- Ned

Tue, 08/17/2010 - 16:45 | 526915 thomas_anderson
thomas_anderson's picture

When Obama wins a Nobel Peace Prize.  Oh wait a minute...

Tue, 08/17/2010 - 18:17 | 527132 malek
malek's picture

You meant to say when he wins his second Nobel Peace prize this year.
For not attacking Iran yet, not opening a second Guantanamo, and not increasing troops in the ongoing wars too much.

Tue, 08/17/2010 - 16:49 | 526927 chet
chet's picture

When Leo tells you to buy Chinese solars.

Tue, 08/17/2010 - 16:57 | 526949 Temporalist
Temporalist's picture

When a Zimbabwean dollar and an FRN are equal in value.

Tue, 08/17/2010 - 18:26 | 527152 knukles
knukles's picture


Tue, 08/17/2010 - 17:00 | 526959 walküre
walküre's picture

Reality check:

China is not in recession. Germany has left recession and is going into major growth.

How relevant is the overindebted overleveraged overinflated US economy in real terms anymore?

China has officially surpassed Japan. That's not small potatoes.

In other words, what if the rest of the world is doing ok or great but the US is in deep shyte?


Tue, 08/17/2010 - 17:10 | 526976 chet
chet's picture

I'd take a closer look at the countries around Germany, Walkure.  How are they doing?

And the US is a quarter of world GDP.  If we sneeze, no one is avoiding the pneumonia.

Tue, 08/17/2010 - 17:28 | 527026 still kicking
still kicking's picture

I am saving this comment, I want to see where Germany and China are in 12 months, if you are correct by that point I will publically apologize for calling you a dumbass which I am right now.

Tue, 08/17/2010 - 18:30 | 527158 New_Meat
New_Meat's picture

kick'in-my bet is under. - Ned

Tue, 08/17/2010 - 18:57 | 527211 Treeplanter
Treeplanter's picture

Yank out the tent pole and the rest comes down.  There is so much bad debt and cooked books out there no one escapes when the biggest market in the world goes broke.

Tue, 08/17/2010 - 20:34 | 527339 Iam_Silverman
Iam_Silverman's picture

"China is not in recession. Germany has left recession and is going into major growth."

Let's see, Germany makes manufacturing and power generating goods for the Chinese, who use those things to....make stuff for the American consumer.

"In other words, what if the rest of the world is doing ok or great but the US is in deep shyte?"

Then the US stops buying the stuff that the rest of the world makes?  Of course, that won't affect their economies, will it?

Tue, 08/17/2010 - 17:13 | 526980 NumberNone
NumberNone's picture

When the fat guy at Marble Slab says there's not enuf sprinkles on his ice cream cone. 

Tue, 08/17/2010 - 18:05 | 527095 Lucky Guesst
Lucky Guesst's picture

When your small business finally qualifies as a non-profit!

When its legal as self defence for government employees to shoot on site any friends or relatives that ask them for an application or job referral!

When US immigration pulls over illegals and they promise they are just passing through!

When you need a Chinese translator to read your eviction notice!

When you start seeing copper commercials to send in your old and unwanted IUD for cash! 

Tue, 08/17/2010 - 18:11 | 527118 Lucky Guesst
Lucky Guesst's picture

When the diet industry is obsolete!

Tue, 08/17/2010 - 19:19 | 527249 boomer
boomer's picture

How much longer until the wheels come off this jalopy?

Tue, 08/17/2010 - 20:32 | 527337 bluebare
bluebare's picture

you know a double dip is imminent when the weiner gets hard a second time.

Tue, 08/17/2010 - 20:35 | 527340 Iam_Silverman
Iam_Silverman's picture

Here is where VeloBabe would step in with a comment.......

Tue, 08/17/2010 - 20:38 | 527345 Sqworl
Sqworl's picture

You seriously begin to consider moving to Juarez for a better standard of living....

Tue, 08/17/2010 - 20:38 | 527346 Iam_Silverman
Iam_Silverman's picture

Just as a side note, I saw something that really made me laugh yesterday!  I was fueling up the rental car just down from the Chuck Yeager Airport in Charlotte WV yesterday.  When I removed the pump handle, I saw a tiny black and white sticker that said "Who is John Gault?"  I wonder how many foks looked at that sticker and wondered what that meant, and how many looked at it and knew exactly what the message was?

Tue, 08/17/2010 - 23:25 | 527548 RichardENixon
RichardENixon's picture

2 guys knew what it was, you and the guy who put it there.

Wed, 08/18/2010 - 01:40 | 527655 PiratePiggy
PiratePiggy's picture

Stifle yourself, Tricky! If if wasn't for you and your party, we'd all have real money. 

Who is Rand Paul?

Wed, 08/18/2010 - 06:37 | 527771 nmewn
nmewn's picture

I'm not so sure.

Many believe most of the gold was already gone from Ft. Knox when Tricky Dick did that. Kinda like the COMEX right now ;-)

A real audit would lay any concern to rest...but has not been done since Ike if I recall correctly.

Wed, 08/18/2010 - 09:47 | 527949 grunion
grunion's picture

The arrogance and elitism that surfaces in these threads does not reflect well on Zerohedge.

So what if a number of Americans are not acquainted with the works of Ms. Rand. It is hardly an indictment. Philosophy does not rate high in the public conscience. Most are too busy trying to survive.

I am not a name-caller but you sir, sorely tempt me.

Wed, 08/18/2010 - 10:12 | 528003 Iam_Silverman
Iam_Silverman's picture

"I am not a name-caller but you sir, sorely tempt me."

OK, call away.  I'm a big boy - you won't hurt my feelings.  I am not passing judgement on most of America.  I think we are all aware of where the typical American stands when it comes to reading (and comprehension) and other mind-expanding pasttimes.  What I was trying to imply was that most people don't realize that the economy is in much worse shape than we are being led to believe.  When folks see past the charade, they start to equip themselves with tools to survive with.  Knowledge is the most important tool at this juncture.  When you seek knowledge, you read books on that topic.  My observation was that I was merely wondering how many Americans have reached the awakening point?  The ones who have read Rand will be surprised at how closely life is imitating art (or fiction).

"Philosophy does not rate high in the public conscience"

You are wrong here.  I think you meant to say Published Philosophy, with a bent towards the ancient classics.  The public is fed a constant stream of philosophy every day - be it in the form of written tomes, lyrics in songs, or spoken lore.  Just reciting the Pledge Of Allegiance reinforces the philosophy of patriotism and duty to your country.

Tue, 08/17/2010 - 20:55 | 527364 carbonmutant
carbonmutant's picture

When US Bankruptcies Reach a 5-Year High...

Tue, 08/17/2010 - 21:53 | 527424 akak
akak's picture

.... when Leo becomes bearish on Chinese solars, and starts soliciting comments from other ZH posters regarding how and where to best buy gold.

Tue, 08/17/2010 - 21:50 | 527433 P-K4
P-K4's picture

You know we're headed for a double dip when:

Americans start crossing into Mexico illegally

Your bag of weed has no seeds

You car jack to go on vacation

You're making lease payments on your Schwinn bicycle

Ruth Chris offers a dollar menu

Food stamps come with postage due

Tue, 08/17/2010 - 22:34 | 527499 Buck Johnson
Buck Johnson's picture

When this market falls, it's going to go right back to the 6 thousand and change and then go even further down.  The Fed freaked out when they saw almost half the market get lost back in early 2009.  In every market there is a psychological bottom, where group think/panic comes into being.  The Fed knew that if the dow got any lower then there would be panic selling to get out, completely out and they couldn't let that happen.  On top of the Money Market funds needing to be bailed out one afternoon (a congressman was on Cspan saying so, youtube it) because paulson told the congressman that if they didn't pass or get an agreement, the US banking system would have imploded that afternoon.



Tue, 08/17/2010 - 22:42 | 527511 JR
JR's picture

Fun off...

10 Signs the U.S. Is Becoming a Third World Country by Activist Post | | August 17, 2010

The United States by every measure is hanging on by a thread to its First World status. Saddled by debt, engaged in wars on multiple fronts with a rising police state at home, declining economic productivity, and wild currency fluctuations all threaten America's future.

The general designations of the ranking system for world status date back to the 1950s... Since the Cold War, the definition has come to be synonymous with repressive countries where a wealthy class of ruling elites segment society into the haves and have-nots, many times capitalizing on the conditions that follow an economic crisis or war.

...We can speculate about who and what is to blame for America's fantastic fall, but for the purposes of this article we shall focus on the obvious signs that the United States is beginning to resemble a Third World country.

1.      Rising unemployment and poverty: Unemployment numbers, food stamps, and home foreclosures continue to reach new record highs...

2.      Economic dependence: The United States finished 2009 with a debt-to-GDP ratio of 85%, according to the... IMF. The current trend projects the United States to finish 2010 at 94% and 2011 at 98%. The 90% level has become the IMF's make-or-break point for countries hoping to grow their way out of debt…

3.       Declining civil rights: ...As the anger of the populace mounts in response to declining economic conditions and political corruption, the government counters by increasing draconian measures that restrict the political rights and civil liberties of its citizens. America is becoming a country like China, which has one of the lowest scores according to Freedom House. In America, private discussions and movements are monitored, free speech is corralled, the freedom to assemble for protest is by government decree, and independent thought that questions the political system is increasingly looked upon with suspicion. A final indicator is when the government insists upon secrecy for its own actions, while new laws and systems are created to put the individual under nearly constant surveillance.

4.        Increasing political corruption: When political corruption becomes the accepted norm... then there's a good bet your country resembles the Third World. Congress and all major institutions face a growing crisis in confidence... It now seems obvious to all observers that big corporations directly control the agenda in Washington – much like typically corrupt Third World countries.

5.        Military patrolling the streets: The rise of a militarized police state is a hallmark of most Third World countries, particularly in times of rapid economic collapse. America's declaration of the War on Terror has created a constant threat to National Security that has allowed for the military to be deployed on American soil. Building upon the War on Drugs, this has created a fusion between the military and local police, where military-grade weapons and tactics are being used against American citizens in a cascade of violent confrontations over non-violent offenses. Military checkpoints are moving farther inland, away from meaningful border control functions, and a full-blown military presence in American cities has been planned by the U.S. Army War College. …

Read the rest of the article


Tue, 08/17/2010 - 22:49 | 527518 Oracle of Kypseli
Oracle of Kypseli's picture

When Geinther finally utters:

"I always wanted to be somebody, but I should have been more specific" 

Tue, 08/17/2010 - 23:42 | 527558 bigdumbnugly
bigdumbnugly's picture

when bawney didn't receive the happy ending he expected the first go-round.

Wed, 08/18/2010 - 10:14 | 528008 Iam_Silverman
Iam_Silverman's picture

Don't worry, he'll get it in the end - eventually.

Wed, 08/18/2010 - 03:56 | 527711 blunderdog
blunderdog's picture

Sheeeyit I hate all this talk about "double dip."

From where I and all my acquaintances are standing, it looks like we're still in the first leg of the dubya.

It's an obamanable situation, for sure.

Wed, 08/18/2010 - 05:03 | 527730 DukkButt
DukkButt's picture

Here in  Oregon, in Dallas (sort of a bedroom suburb of the state capitol, Salem), a former light manufacturing facility (circuit boards, or something like that) sold for $250,000. That princely sum bought 127,000 square feet of building (NOT a typo) and 8 acres that had a tax assessed value of $3.3 million. The wheels have come off, the car is over the cliff, but the occupants just haven't looked down, yet. Can you say "Debt destruction and deflation"?

Wed, 08/18/2010 - 10:16 | 528015 Iam_Silverman
Iam_Silverman's picture

"but the occupants just haven't looked down"

They're still too busy dorking around on their iPads and Iphone-4's to notice.

Wed, 08/18/2010 - 07:35 | 527794 Headbanger
Headbanger's picture

When the Fed offers an IPO.

Wed, 08/18/2010 - 09:37 | 527937 grunion
grunion's picture

When I make money...

Wed, 08/18/2010 - 11:48 | 528242 romanko
romanko's picture

my boss asked me to look at a collegue's analysis, she didn't like what the data implied - ie. other departments are using loopholes to shift overhead costs out of their budgets - I was asked to "strategically position" the data, not sure what that means, guessing too many feathers would be ruffled if the truth were known.

Sun, 08/22/2010 - 02:07 | 535731 JackES
JackES's picture

LOL, you guys are sick.

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