Is Anyone Really Surprised That the System is On the Brink Again?

Phoenix Capital Research's picture

We find it truly extraordinary that anyone is surprised the financial system is under duress again.


After all, what have the Central Banks accomplished in the last five years?


1)   Did they clear out the bad debts that caused the 2008 collapse? NOPE

2)   Did they implement structural reforms to insure another 2008 didn’t happen? NOPE

3)   Did they punish fraud or corruption in any way to insure that the system was clean? NOPE


So what did they do?


They cut interest rates over 500 times and funneled over $10 trillion into the financial system, over 98% of which went to the very players (key banks) who nearly blew up the world in 2008.


And people are actually surprised that the system is back in trouble again? Would you be surprised if giving another shot of heroin to a drug addict who was in a coma didn’t bring him to health?


Honestly, did anyone think this would really work? I know that the connected elites loved it because the whole process allowed them to hand off their garbage investments to the public while leveraging up to acquire more assets via the Fed’s cheap money… but what about those who DON’T work for a top 20 global financial institutions? Did anyone actually believe this would work?


So here we are today, Europe’s already insolvent banks are now potentially on the hook for $3 trillion in Emerging Market investments.


When your entire banking system is leveraged at 26-to-1 it really doesn’t matter who you lend to… you’re bust. But in this case, the bad emerging market investments are just the icing on the rotten cake that is Europe’s banking balance sheets.


Hopefully Mario Draghi can “promise” something again and the whole system will hold together. After all, THAT and Bernanke’s decision to engage in more and more QE (despite NO evidence that QE benefits the economy) are what brought us back from the brink in June 2012… maybe Janet Yellen and Mario Draghi can repeat this.


Then of course there’s China… which has created the single biggest credit bubble relative to GDP in history. Nevermind, that they literally blow up buildings to build new ones to pad their GDP numbers… China is a miracle and its economy is on the verge of becoming another US.


The world believes China can become more driven by consumers… though the data shows consumer spending has grown by 9% a year for 30 years there… so hoping that things are going to erupt higher there is a little misguided.


And of course there’s the US, which is STILL printing $65 billion per month despite two QE tapers… which folks claim were terrible for the world (how exactly is printing $65 billion per month five years into an alleged recovery, a good thing? Doesn’t that NEGATE the entire claim of a recovery at all?).


You can build a house on a rotten foundation (bad debt, fraud, corruption) and it will stand for a while. But eventually it will collapse.


This will again happen with the markets. The only difference is that this time around, the Central banks have already spent most if not ALL of their ammo propping up the system.


For a FREE Special Report on how to prepare your portfolio for a bear market collapse, visit us at:


Best Regards


Phoenix Capital Research




Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
ImReady's picture

This is great news!

If TBTF can lever up @ 26:1 and survive then so can I!


$100k salary x 26 = $2.6m x 5% interest for 30 yrs= $14k/mo payments. Easily doable on $8,300/mo income!


Who knew it was so easy?



SheepDog-One's picture

Normalcy bias is a hell of a drug!

Global Observer's picture

No one who is paying attention and is capable of understanding is surprised that it is on the brink of a collapse. The only surprise is that it held up for so long.

However there are many who are either not paying attention or not capable of understanding and they will be surprised when the collapse happens that the people they credited with omnipotence are really not omnipotent. Since the collapse will not adversely impact everyone, they might believe it was deliberately engineered by those who were left standing when the collapse happens.

doctor10's picture

"the same minds that created the problem aren't capable of a solution"

The final and end stage of any and all oligarchies is that they run out of minds and solutions.  Their efforts become devoted to quelling thier competiton rather than seeking the best ways to expand and grow.

Notarocketscientist's picture

Graham - you are missing the BIG PICTURE - why do you think the Fed is engaging in suicidal policies?  Do you think they are stupid - do you think they are doing this to enrich the banks?

Of course not - the top 1% know that engaging in these policies may make them wealther for a short time - but ultimately they fucking well know this will blow up the machine.

So why would they do this????

Here's an explanation:


High energy prices = less consumption because everything including the fuel in your tank costs more = layoffs = less tax revenue = government cutbacks, layoffs and debt increases = less consumption = more layoffs = less taxes =====  economic death spiral.


Compounding the problem is the fact that a weak labour market means real wages drop - as they are across the world right now - that means everything is more expensive and your buying power is dropping at the same time.


Governments recognize this and are trying to offset with debt, easy lending (they are purposely inflating bubbles), lower interest rates and money printing.


Of course they will fail - because the disease is expensive oil.  And there is no substitute


The economic death spiral will accelerate when the QE and ZIRP no longer have any effect and the confidence game collapses.


This moment will be known as the end of the industrial revolution by the few who survive.


This is not a Hollywood movie where the hero saves the day.  This is the reality we are facing.


See:  and


Sorry Graham but this kinda fucks up your gig - because there's not much one can do to trade this ---  when this hits people will be ignoring piles of gold because they will be starving and food will be the new gold. 


Learn organic farming people --- buy a piece of land and get the fuck out of the cities --- that's no guarantee of survival but it's about all there is.




Rising Sun's picture

I am totally surprised!!!!


I mean that fucking cunt Yellen keeps printing $65B a month with little or no effect - that shouldn't cause any damage, should it?


Right Ben you fucking $85B a month cocksucker???


Oh, and fuck you too Barry.

Andy Lewis's picture

"under duress"?  Up our ass is more like it.  Shit 'em out and flush 'em to Gitmo.

golfrattt's picture

Trolling for subscribers has risen to new levels.  If you yell 'fire' enough times, sooner or later you're bound to have a fire..


BTW, did you notice that Graham Summers name is no longer displayed..?  Nice


Q:  What's the difference between Graham Summers and a Catfish..?


One's a bottom-feeding, Garbage-eating Scumsucker...


The other one's a fish

Asok Asus's picture

Yeah, and good luck in getting that "free" report!

novictim's picture

Regulation is bad, right Zero Hedge?

OpTwoMistic's picture

Regulation can be good or bad. Non enforcement is a disaster. Where is justice?

rsnoble's picture

Number 4: Do a large % of US dumbasses know anything at all about any of this stuff---No.

It will be a complete shock for probably 70% or so who will think the collapse happened 'overnight' and the gov't will be happy to tell them that.

Some of them are so fucking stupid and in loser condition they may never even notice an outright collapse as long as they have meth and blow job customers.

satoshi911's picture

US-MIL pay's HIGH-SCHOOLS to Kidnap Children and Send them to IRAQ to Die ... Now this is news

More than 1,200 people are under investigation for a US military recruitment fraud during the Iraq war, officials say.

Two generals and dozens of colonels are implicated in the alleged scheme, in which referral fees were illegally collected for recruiting soldiers.

The fraud is said to have already cost the US government at least $29m (£17.7m) and may top $100m in total.

Details were revealed by two Army generals at a US Senate hearing.

The National Guard programme - established in 2005 and later expanded to the Army and Army Reserve - paid soldiers, civilians and retirees $2,000 to $7,500 to recruit friends and family, according to congressional documents.


According to investigators, numerous schemes were used to defraud under the programme, which saw the Army pay out more than $300m for 130,000 recruits during the Iraq war.

We're talking about one of the largest criminal investigations in the history of the Army”

Claire McCaskill US Senator

High school principals and guidance counsellors were said to have accepted money for recruiting students who they knew were already planning to join the US military.

jonytk's picture

Bring it on, keep printing, i'm all in btc :D

stant's picture

when this blows , and your wife and kids are sitting there tears and fear in thier eyes , hoping you can pull a rabbit out of a hat. you better have a hat and a rabbit. godspeed

Buck Johnson's picture

We are out of "easy options".  Whats left is outright confiscation and/or bank holidays.

Ban KKiller's picture

There are no more clean shirts. 

Banking system is Fascisim. That it the only explaination for the facts.

LawsofPhysics's picture

Well, we sure as hell knew that you wouldn't be.  Seriously though, when do we start seeing the big banks actually FAIL? 

Please, do tell.

dexter_morgan's picture

YES. They said it was all better on Huffpo and Kos, so of course I am surprised!

RaceToTheBottom's picture

The FED stands ready to do what it will take to protect its interests

Stuck on Zero's picture

The financial system is not under "duress."  They are fat and happy.  It is the taxpayer who is under duress.


Al Gorerhythm's picture

It will insure it, I guess. What the payout will be I can't say. Ensure does not mean insure, Stuart.

El Oregonian's picture

It's the ol' "Trying the same thing and expecting a different result" insanity definition. OR, In this case "DOING the same thing and expecting the same result!" Which IS criminally insane!!!