Global Debt Exceeds $100 Trillion

George Washington's picture

Bloomberg reports:

The amount of debt globally has soared more than 40 percent to $100 trillion since the first signs of the financial crisis as governments borrowed to pull their economies out of recession and companies took advantage of record low interest rates, according to the Bank for International Settlements.

Has all that money gone to stimulate the economy?


Virtually none of it has.  Instead, governments chose big banks over their own people.  The huge amount of debt was racked up to bail out the big banks.

Central banks have been engaged in the the “greatest backdoor bailout of all time.”

And yet – as Bloomberg notes – everyone else gets austerity:

Concerned that high debt loads would cause international investors to avoid their markets, many nations resorted to austerity measures of reduced spending and increased taxes, reining in their economies in the process as they tried to restore the fiscal order they abandoned to fight the worldwide recession.

In essence, the elite financial players are manipulating the game so that they get the stimulus … and the little guy gets the austerity.

Indeed, the IMF is recommending “financial repression” of the average person, to plug the giant debt holes created by the bank bailouts.

And – whether or not you like Keynesian stimulus (most ZH readers don't!) – you should know that governments never really engaged in meaningful stimulus.

But didn’t we have to do this to save the economy after Lehman crashed?

Nope … top economists say we should instead of done what Iceland did:  let the big banks go bust, and use resources instead to help the people.

Proof can be found in the fact that throwing money at the big banks has led to a  “jobless recovery” – a permanent destruction of jobs – which is a redistribution of wealth from the little guy to the big boys. (And see this.)

Indeed, everything the government has been doing since 2008 has made unemployment much worse. And  here and here.

Postscript:  In 2010, economics professor and former Senior Economist for the President’s Council of Economic Advisers Laurence Kotlikoff said that - when unfunded liabilities are taken into account - the fiscal gap for the U.S. alone exceeds $200 trillion:

Based on the CBO’s [Congressional Budget Office's] data, I calculate a fiscal gap of $202 trillion, which is more than 15 times the official debt.

 As of a couple of months ago, Kotlikoff put the figure at $205 trillion.

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Notsobadwlad's picture

Uhu ... a 100 trillion what? the entire 100 trillion is a fiction enforced at the point of a gun... nothing more.

The sad part about that fiction is that it is used to enslave people and steal their labor and property.

Tim_'s picture

What is actually going on in Iceland

"Since people continue to spread the factually dubious statement that Iceland 'told creditors & IMF to go jump, nationalised banks, arrested the fraudsters, gave debt relief and is now growing very strongly, thanks' I find I have to write this here thing."

1. Iceland told IMF to go jump, go away, left the IMF program etc.

"No it didn’t. Just look at the IMF’s country overview page for Iceland and read the reports."

2. Iceland told the creditors to go jump.

"Yes and no. Iceland didn’t bail out the collapsed banks, but that wasn’t for the want of trying. If you read through the Report of the Special Investigation Commission you’d find out that the Icelandic government tried everything it could to save the banks, including asking for insane loans to pay off the banks’ debts."

3. Iceland arrested the fraudsters...

"Iceland arrested some fraudsters: the pawns, small fry, and the lackeys."

4. Iceland nationalised the banks.

"This much is true. Iceland then privatised them again in record time. Two out of the three collapsed major banks in Iceland are now owned by the creditors. ('But I thought Iceland shafted the creditors?' Hah! Yeah, funny that.) The third bank, Landsbanki, is still nationalised but that’s solely because of the ongoing court cases involving Icesave (more on that later)."

"Most of the creditors actually sold their stakes to foreign hedge and vulture funds and the like. Again, google translate it if you actually care about the facts."

"So, not only did Iceland re-privatise the banking system, we sold it out of the country."

5. Iceland gave debt relief.

"The answer to this one is yes, but not really."

"The the top 1% has had almost all of their debt written off, for example. Wasn’t that nice of the banks?"

"For the rest of us, the picture is a lot more complicated."

"The Icelandic government has fought debt relief tooth an nail, with every resource and tool available. They have in every way possible been the banking system’s crony."

"Basically, households are worse off now than they were, not better off, and the debt relief programs were little more insubstantial political manoeuvring to gain votes, not proper debt amnesty like that campaigned by the Occupy movement."

6. Iceland is now growing very strongly

"Unless you’re the kind of person who looks at a child with leukaemia and says ‘look at little bald Charlie, how strongly he’s growing’ then I’d have to say no to that one. Surviving is not growing strongly."

7. Icesave

"This is the root of all of this nonsense. The short version of the story is that Landsbanki, run by the convicted fraudster Björgólfur Guðmundsson (which in and of itself should have been a warning to you people), started a dodgy savings account scheme that promised unrealistic returns in the UK, Netherlands, and elsewhere, collected money from a bunch of greedy idiots, went bankrupt and the money disappeared to god knows where."

"Finally, what the hell is going on?"

"Why are these myths being spread about Iceland? Why do people think that Iceland is a progressive paradise when in actual fact its a Thatcherite’s wet dream?"

"The only thing I know is that you are being lied to and that Icelanders are very good at lying to themselves."

novictim's picture

Tim, man did you get this WRONG!

I reviewed the IMF reports:

1) The IMF complains that Capital Controls are not being lifted.  This means that Iceland is preventing vulture capitalists to swoop in and ferry away the capital of the country...Iceland will not sell its inheritance, iceland will not dis-employ its people, ICeland will not allow money bags to come in and take over ownership of their fishing fleets.  GO ICELAND!  FUCK BRETTON WOODS!

2) IMF wants Iceland to give up its own currency...and adopt the EURO.  Can you say "GREECE", Tim!  ICELAND ROCKS!  Iceland will not fall into the trap that Greece did.  It will essential retain control over its currency.  

3) Meanwhile, IMF says that Iceland is making a good recovery.


Tim, either you don't understand or you are a propagandist or BOTH!  Or perhaps you are a British or Dutch Hedge Fund guy who got screwed by the Icelanders...hahahahahaha

MrBoompi's picture

Central banks, owned by the richest and most powerful people on the planet, have a few non-public mandates which supercede any of the public mandates they throw at us.  Mainly, they are to control the issue of money and the value thereof, to control governments through the use of debt, and to protect the "owners" at all cost.


luckylongshot's picture

This same situation has played out regularly throughout history, dating back to the pharoah who put Egypt deeply in debt building the great pyramid. The solution has been the same throughout all of history as well....cancel the debt. So either history stops repeating itself or there's a debt jubilee heading our way. The sooner the better!

diluted intelligence's picture

would that be ......  Priceless  ??

xavi1951's picture

In a very simplified explanation, country A is in debt to countries B,C,D.  Country B is in debt to countries A,C,D.  Country C is in debt to countries A,B,D.  And country D is in debt to countries A,B,C.

So lets all forgive our debts and do this again........with gold.

novictim's picture

Global reset on debt?  We can do this the hard way or the easy way.  War is the hard way.

DerdyBulls's picture

By the way, I understand unfunded liabilities are 200 trillion, not 100T, George.

BeetleBailey's picture

237 Trillion and loose change are correct.

DerdyBulls's picture

-1 for asking a legit question. Wow.

Radical Marijuana's picture

Well, DerdyBulls, I have only been posting on Zero Hedge for about a year or so. However, as I understand it, the Tylers refer to the movie called the Fight Club.

It appears to be in that context of a fight club that the urban slang of "bitchez" gradually transformed to become a kind of standing insult, or inside joke, in this Web site's comments. (I do not know any better than that ...)

DerdyBulls's picture

Never thought of myself as a whore.  

Thanks, Radical. I saw fight club. Sorta interesting. For one who believes in non agression unless absolutely necessary the movie struck me as a little over-the-top violent.

Tall Tom's picture

Fight Club is a semi-fictional Documented plan of action. You had best watch that movie again. Understand what Mr. Durden wants.


I like Soap.

Wen_Dat's picture

You might want to watch it again. Wasn't really about violence...(superficially, yes). 

DerdyBulls's picture

What is the "bitchez" thing about anyway? A fetish for female dogs? New here.

BeetleBailey's picture

EZ comment post;


Silver BITCHEZ!!!!


..that sort  of nonsense




forwardho's picture

Weather you know it, like it, or care the fed has made us all their....


whidbey-2's picture

Our leadership has figured social debt to be a victimless crime, so no crime committed yet, until the following generations start asking " what happened to us how we get hooked like this??. Who took the money?  Economists called it time arbitration of debt ,and its been going on for 89 years more or less.  The story is "we will outgrow the debt before it becomes binding on the saps, opps! read "citizens".  In liberal economics departments they even say that debt level with maturity dates pushed out in time, is a must for any mature economy.  BUT it has been pushed to levels no one contemplated when the party started in 1913 with the creation of a central bank by W. Wilson.  Andy Jackson figured the tricks in the middle of the 1900 century and refused a national bank with the capacity to indebt all national banks legally. We must grow up sometime and now is a good a time as any for getting a mature view of who we are and our limits. End the Fed and the  national banks who will not accept swimming naked without a life ring called the Fed.

Comte d'herblay's picture

Grow up?? Have you been paying attention to the culture??

Fully physiologically grown males in their 40s 50s and upwards are sporting multiple ear rings, tatoos all over their arms and other body parts, they wear their caps backwards, they watch inane subjuvenile crap on TV and the movies; the books they read are on the top best sellers lists and sport titles that promise there is a heaven, and a god and their cats speak.

I'm afraid the notion of maturity passed away some time in the late 60s when unbridled sex and drugs were elevated to entertainments with no consequences. WE can see today how well that worked out with STDs, AIDS, and HIV as a result affecting billions of people.

Add to that the obsession of hundreds of millions of americanos, with revisionist theories as if they were fact that you can have it all; women can be just as equal to men in all things; and it's ok to say nigger if you're black but be stoned if you're white; absurd national attention on homosensual " marriage "; the ascendance of perversity as norma; complete voluntary ignorance about things that really matter.

Neil Postman covered it decades ago with, "Amusing Ourselves to Death", the primer in living in a permanent state of pre-adolescence. 

My dad and mom managed it till they died in their nineties, forever while they were alive, acting like children. 


DerdyBulls's picture

Duplicate, wow server's slow

DerdyBulls's picture

Dup again, sorry.

DerdyBulls's picture

GW makes the point that the stimulus (ongoing) is stimulus only for the 1%. Therefore it is not being loaned into the general economy. How can all this debt lead to inflation when its parked at the FED and in the accounts of one percenters only? The money stock / monetary base mirrors bank reserves parked at the FED???? Please don't start talking about the price of goats milk at the gentleman farm, okay? Thanks.


If you want to talk about goats go ahead. Sheesh

Tall Tom's picture

The United States exports the inflation to Emerging Markets. That capital does not sit idle in the Bank Vaults as "Dead Money". It is invested abroad.

This is the reason that the Taper has had the effect of collapsing Emerging Markets. QE was a program to recapitalize the World Banks., not just the United States Banks.


China has spent all of that capital unwisely. Now the capital flow has slowed. Thus Chinese Corporate bonds begin to default.

Radical Marijuana's picture

This article will surely attract statements of oversimplified poetry about cursing and killing the bankers, as is quite common to read on Zero Hedge. However, theoretically, we should think differently about "death controls" in general. We should be thinking about using unitary mechanisms to understand how and why governments ended up becoming the biggest forms of organized crime, controlled by the best organized gangs of criminals. That is extremely important because the basic structure of the MONEY-AS-DEBT system necessarily drives itself to automatically get worse, as that debt slavery system has driven its numbers to become debt insanity.

As several comments on the previous Zero Hedge article about this increase to about 100 trillion provided detailed links to, the total debt is several quadrillion:

One has to dig into somewhat hidden history to discover how we ended up with a global system of privatized fiat "money" made out of nothing as debts, which automatically and necessarily must generate more debts in order to be able to do anything, but which has already reached a point where the total debts have gone beyond mere debt slavery, to become debt insanity. The root cause was the application of the methods of organized crime to take control over the political processes, through bribery, intimidation, and assassination of those who could not be bribed or intimidated. The seeds of the currently established Money-as-Debt system go back to Europe a few Centuries ago, with the Bank of England being the biggest and longest lasting achievement. In the USA, the Federal Reserve Board was accomplished a Century ago, with the demonetization of silver and gold spread out from 1872 to 1971.

By persistently applying the methods of organized crime to the political processes, almost all politicians have effectively become puppets for the bankers, whose job it is to perform for the masses of muppets, which have been brainwashed to believe in the bankers' bullshit by their schooling and their indoctrination by the mass media, since control of those institutions was also achieved through the leverage of the domination of the funding of those institutions, decade after decade. Overall, the establishment of a fundamentally fraudulent financial accounting system (which is almost inconceivably crazy and corrupt from an objective point of view), has been able to leverage itself up, with a runaway ratcheting of some of the profit from fraud being reinvested in more fraud, so that pretty well the whole social system is now based on almost 99% legalized lies, backed by legalized violence, which has become a globalized system of electronic frauds, backed by atomic bombs.

That is the system that has enabled there to be quadrillions of units of submerged debts overall, with the 100 trillion mentioned in this article being the tip of the iceberg. Since we have a money-as-debt system, if we had no more debts, we would have no more money. Instead, everyone with any legal power to legally counterfeit more "money" out of nothing, as debts, have developed every possible excuse for doing so. Thus, the concept of collateral has been left behind, as a vestigial appendage that no longer functions, since the amounts of money made out of nothing as debts has exceeded all possible real collateral by at least a couple of orders of magnitude. Furthermore, if one includes all other surrounding claims based on the widest definitions of credit, then the notational money-as-debt is several orders of magnitude greater than all the actual collateral.

That gives rise to the question, since there is really no physically existing collateral to back up the "money," what is that "money" actually based upon. The answer is obvious, IF one is willing to look at it: the debt controls depend on the death controls, because money is actually measurement backed by murder. That exists within the bigger context that all private property is based on claims backed by coercion, which exists in the bigger context that all human realities are organized lies, operating robberies.

In the case of the privatized fiat "money" made out of nothing as debts system, the fiat money is primarily backed up by the sovereign powers of governments to demand the payment of taxes in the form of that fiat "money," and to deem that fiat "money" to be legal tender. Hence, the police and armed forces back up that form of fiat "money." Behind the scenes, the international bankers, as the biggest gangsters, the banksters, were able to apply the methods of of organized crime to covertly take control over the political processes, so that their puppet politicians would legalize the current financial system, which is legalized fraud, through the legalized counterfeiting of the public "money" supply by private banks, which legalized frauds are enforced by legalized violence, by the police and armed forces. Indeed, through that process, the meaning of words were perverted and inverted, so that "money" itself now means the opposite of what that word used to mean, since our currency is credit inside the the money-as-debt system.

Meanwhile, puppet economists, speaking through controlled schools and mass media, promote the biggest bullies' bullshit view of the world to the majority of people, who have been reduced to being Zombie Sheeple, that do not understand the money system, because they have been conditioned to not want to. From a practical political point of view, that means there actually are no good solutions possible to our real problems. Given that enough of the people can be fooled enough of the time, and have been already reduced to incompetent political idiots, who are nothing more than bullshit consumers, rather the competent to be citizens, the most realistic future projections are for those masses of sheeple to continue to be fleeced to exhaustion, and then slaughtered. Anything else would require a series of political miracles, which are, by definition, very unlikely.

One may sympathize with that, because if one faces the necessary facts that the debt controls depend on the death controls, and that money is necessarily measurement backed by murder, then the only genuine resolutions to the existing problems must be based upon better death controls, operated through better organized crime, with those understood through unitary mechanism, not through false fundamental dichotomies, promoting the impossible ideals based upon those false fundamental dichotomies. None of the currently established ideologies or religions are able to do that, because none of them want to do that. Rather, there are runaway contradictions due to progress in science and technology not being possible to be matched by paradigm shifting progress through intellectual scientific revolutions, which would be applied to politics, and its combined money/murder systems.

In a superficial, and sometimes poetic way, many people curse the bankers, and call for them to be murdered. However, just like taxing the rich would not statistically be able to solve these runaway financial problems, murdering the rich would not statistically be able to resolve anything adequately. Moreover, there is no path there towards genuinely better solutions, because there is nothing in that kind of superficial poetry of hatred and revenge that can actually operate better death controls, in order to have a better murder system back up a better money system.

Of course, what I have written above is merely theoretical, with no practically possible way for that to be politically implemented. Rather, we are rushing towards runaway debt insanity numbers causing runaway death insanity numbers, rather than heading towards anything saner. Indeed, when one steps back from the social polarization driven by the money-as-debt system, headed faster towards its crazy collapse into chaos, to look at the bigger picture about the way that its frauds enabled evil deliberate ignorance towards the destruction of that natural world, all of our real problems are actually trillions of times worse, headed towards becoming quadrillions of times worse than ever before in human history.

In theory, we should be operating through a constitutional rule of law, in order to channel the power that everyone has to rob, and to kill to back up that robbery, in the best overall ways for everyone, over the longest period of time. Instead, we have ended up with a real human ecology, operating as a general energy system, along its path of least action, which primarily has groups of people who could be described as the ruling classes, which are vicious wolves, who direct the domesticated dogs, to herd the masses of sheeple, amongst whom some are black sheeple that protest that system, in a controlled way that continues to promote the same old-fashioned false fundamental dichotomies and the related impossible ideals, which always continue to actually make the opposite happen in the real world.

Only inside of a globalized system of electronic fraud, backed by atomic bombs, could it have been possible to perceive the tip of the iceberg of social insanity of an always increasing total global indebtedness, which has recently reached the symbolic level of 100 trillion notational units. Tragically, there appears to be no realistic chances of politics changing enough to understand things like the quantum mechanics and special theory of relatively, that made those electronic frauds, and those atomic bombs, possible. Instead, our politics is deeply entrenched in old-fashioned religions and ideologies, which are making everything worse, while people still propose that somehow those old-fashioned ideas could make things better.

Theoretically, we need a series of profound paradigm shifts in the philosophy of science, which could then be applied to politics in general, and especially applied to militarism. We have reached a paradoxical point where technologies which are trillions of times better have been channeled through a social pyramid system to create debt insanity numbers, such as that the whole world is obviously and undeniably 100 trillion in debt (and quadrillions more, if one looks deeper into that overall social insanity situation.) Therefore, theoretically, we should stop perceiving that system as a social pyramid system, and start perceiving it as a social toroidal vortex system.

We should connect the top and bottom of the social pyramid, or rather, we need to perceive that they are already connected. We need better feedback of the murder systems upon the bankers, who have already used murder to build the current money-as-debt system. In that context, I sympathize with many other comments on Zero Hedge that curse the bankers, or call for killing the bankers. However, I would abstractly recommend that we should only do that through systematically different death controls, which include everyone, since everyone is already caught up inside the globalized money-as-debt systems, which are driving us all through debt insanities, towards death insanities. As that happens, theoretically, we ought to try to understand what is happening better, so that we might be able to catalyze the coming collapse, so that it would not be as bad as it otherwise would be, and we may genuinely recover better afterwards. Of course, from a more realistic point of view, I see no practical ways that that will be possible, but nevertheless, I have posted this comment just to day dream about political science fiction that might become facts, rather than the apparently more probable path of least morality nightmare science fiction horror stories becoming facts instead.

i_fly_me's picture

Those are generally interesting, if somewhat difficult to parse, comments, Revolutionary Reefer.

To wit:

"One may sympathize with that, because if one faces the necessary facts that the debt controls depend on the death controls, and that money is necessarily measurement backed by murder, then the only genuine resolutions to the existing problems must be based upon better death controls, operated through better organized crime, with those understood through unitary mechanism, not through false fundamental dichotomies, promoting the impossible ideals based upon those false fundamental dichotomies."


"Instead, we have ended up with a real human ecology, operating as a general energy system, along its path of least action, which primarily has groups of people who could be described as the ruling classes, which are vicious wolves, who direct the domesticated dogs, to herd the masses of sheeple, amongst whom some are black sheeple that protest that system, in a controlled way that continues to promote the same old-fashioned false fundamental dichotomies and the related impossible ideals, which always continue to actually make the opposite happen in the real world."

I challenge you to diagram either of those sentences :)

Pedantic, nit-picks aside, I think I can summarize your post thusly:

1. A certain powerful subset of people uses force, and the threat of force, to steal wealth from less powerful people, in order to spend it how they would rather it was spent. This is bad.

2. The less powerful people shouldn't use force to try to stop this.

3. Instead, the powerful should be allowed to continue to use force to steal wealth from the less powerful people, but they should be replaced or convinced such that they spend it how *you* would rather it was spent. This would be good.

I agree with point #1. The fact, that most people don't see it that simply, isn't relevant.

I completely disagree with #2. You cannot reason with an aggressor while letting them hold power over you; you must use force to stop the aggression. 

I also disagree with #3. The idea, that all that is needed is to get people you agree with in charge of things, is risible. There is no such thing as a benevolent tyranny.

In my opinion, the correct answer will ultimately be found in simple ethics.  Do not harm others and don't steal; however, use necessary means to stop those who harm or steal.

Radical Marijuana's picture

I do not agree with your over-simplified summary of my comment, i_fly_me!  I did not say that "less powerful people shouldn't use force." What I was saying was that violence becomes infinitely more problematic after the development of weapons of mass destruction.

I think that "simple ethics" is useless, since it does not sufficiently appreciate the paradoxical nature of political problems. Rather, I promote what I call "military ethics."  My points surround the central problem of how to operate death controls after the development of weapons of mass destruction have been developed. That is a brand new problem. The people who first encountered that problem are still alive today. So far, nothing constructive has been done to resolve that problem. Building more weapons is still the biggest business that human beings engage in, while we have been cruising on autopilot, building bigger, steeper, social pyramid systems based on lies, backed by violence, ... so far, without any test of that ...

Technologies which are trillions of times more powerful have been pumped into political systems which have never had to deal with that reality before. My main suggestions are based on the notions that we should look at the ways of thinking that made those technologies possible, in order to try to develop a different politics, which maybe could survive having those technologies. So far, nothing like that has come remotely close to happening, because most people still want the "simple ethics" found in old-fashioned religions and ideologies, rather than look towards a revolutionized "military ethics" which deal directly with the dilemmas of how to operate murder systems after the development of weapons of mass destruction.

At present, it looks like there may be no good solutions to the problems created by the industrial revolution, but rather, those developments may paradoxically cause even more extinction of life on Earth, since there has been no progress in politics which comes within light years of the progress made in some sciences. I am not asserting the risible point that everyone else should agree with me personally. I am asserting the point that having technologies become trillions of times more powerful has driven society towards suicidal insanities, which, so far, have not had anything adequate done about those developments, because it is practically impossible to have any kind of rational public debates about anything to do with politics.

Military ethics is extremely paradoxical, since success in warfare was based on backing up deceits with destruction throughout all of human history. That is the system into which atomic energy, and electronics, etc., have been pumped, and pumped, and pumped!!! No possible return to any "simple ethics" can cope with that problem!


Comte d'herblay's picture

"....the total debt is several quadrillion".

Big thumbs up.

logicalman's picture

Dead on!

I bet you can go off on a real good rant, given the chance.

I know I can, on this subject. Problem is all I ever get in return are strange looks, or comments like 'Oh, he's off again'

Feels like humanity is floating in a sea of shit and I'm one of the few that hasn't lost my sense of smell.

I'd likely put you in the same group.


Radical Marijuana's picture

Hah, logicalman, since humanity is floating in a sea of shit, losing one's sense of smell is the normal response! It is like the people who live in a town whose main industry is pulp and paper production. That stinks! When one first arrives in that town, it is very disturbing, however, after a while, one tends to no longer notice.

As a package deal, one of both the best and the worst things is that human beings can get used to almost anything. Therefore, we got used to operating inside of system where "money" was transformed into being debt, made out of nothing, even through that is blatant stinking fraud. The private banks became runaway factories of that shit, and everyone had to adapt to living by swimming through that shit, with the most successful people being those who could swim through that sea of stinking shit the fastest. However, despite that some few people do well by developing their skills to swim through that stinking fraud, the overall realities have been the society as a whole, and nature as a whole, being drowned in that sea of shit. However, paradoxically, most people have adapted by not noticing, because they do not want to notice, while most people still tend to think that good "success" comes from being able to swim faster through that ocean of stinking shit of fraudulence, which became the foundation of our political economy.

Therefore, metaphorically, we have gotten "used to" being frogs, boiled slowly in the sea of shit swamping the world due to the privatized fiat money made out of nothing, as debts, system, which is drowning the whole world deeper and deeper in debts which can never be repaid. Indeed, we are inside of a system where is it theoretically impossible to ever repay those debts, since to the degree that debt disappears, therefore, the public money supply also disappears, and thus, fixing the problem of too much debt only causes other problems to get worse, which then, within that system, means that the "solution" is to return to creating even more debts, so that there is again enough in the public money supply.

There is nothing within the shitty MONEY-AS-DEBT system which can remedy its problems. Rather, everything about that triumphant stinking fraud automatically drives every other problem to become more irrational, and get worse, faster, since the only solutions to too much debt within that system is even more debt, as even more money made out of nothing, to pay back the previous debts incurred by the previous money made out of nothing as debts.

Anyone who was truly a logical man would find the utter irrationality and absurd insanity of the established political economy, based on triumphant, runaway financial frauds, to be extremely offensive! However, the majority of people have been able to get used that social situation, and somehow not understand, and not want to understand, the blatant bullshit that the public money supply is being made out of nothing, as debts, by private banks. Therefore, most people have gotten used to themselves, and the whole world, being drowned in that sea of shit, while they are mostly not even able to take notice of that. By losing their sense of smell with respect to blatant stinking fraud, most people have generally lost all sense, and can not apply even the most basic smell test to anything else. Therefore, bullshit almost totally rules the world, drowning it deeper and deeper in constantly more bullshit piled higher and deeper!

logicalman's picture

Again, dead on.

I was fortunate to have two parents who were thinkers.

I first started to see through the bullshit when I was in my teens (late 60's/early70s)

Trouble is the few that see the problems get sucked down into the crap by the unseeing masses.

I just try to take part as little as I can.

new game's picture

therefor if i am debt free (theroetically impossible), my money is shit! hmmm. thanks for your insights.

at least we are .0001 ers in the pool of humanity that understands wtf is going on...

dexter_morgan's picture

What about unfunded liabilities? This should end well.......

slightlyskeptical's picture

Does this mean that I don't have to pay back my herion and tatoo induced student loan?

After all it was fraudulent since they told me It would give me an education.

Dugald's picture

 But you did get an education, you learnt to read and write and make spelling errors here on ZH, your education caused you to decide to be a tattooed dope addict, if your telling the truth that is, at least you read ZH which I suppose demonstrates that you have not yet totally scrambled your grey matter.

swmnguy's picture

He's just goofing on a James Howard Kunstler blog entry.

kellycriterion's picture

Chunga the 100 tril figure only refers to certain types of obligations. Many of the unfunded obligations in reality have higher priority than the allegedly funded.

In addition all paper wealth isn't created equal. In addition to formal grading there are questions about whose paper wealth will evaporate and what are the connections to derivatives or real assets. In short some can be stiffed without much consequence while in other cases......

RaiZH's picture

Only real way out I see is gold 

chunga's picture

ok, so who is owed all this money?

Couldn't sleep last night so I read Tyler's article on china defaulting on the bonds. Judging by the comments, I expected the world to be in chaos this morning.

The sun is out and I haven't heard a damn thing about it elsewhere???

Johnny Cocknballs's picture

Repudiation, my dear George.

It is not only ethical, proper and pragmatic, it is inevitable.

That's the thing about interest and fractional reserve money creation....  eventually, the energy available in the system is insufficient to even support the debt service.  Our toes, globally, are over the line on that now.

Which is why Ukraine, e.g., is doubly fucked.

Repudiation, bitches.  Frac reserve lending is a fraud anyway - no consideration was offered - if you can create currency out of nothing and loan it to me at interest, and I can only gain currency by an exchange of my labor, you have given me something which did not have value until I deposited it, at no cost to you - failure of consideration.

Failing to pay someone back still breaks the contract to pay them back, but the contract was predicated on fraud, and fuck 'em anyway.

End the Fed, and end fractional reserve lending.

Comte d'herblay's picture

Bankruptcy is a legal out to repaying debts that can be made look 'net' of assets owned.

If you know anyone who bankrupted, chapter 7, you likely wonder how they managed to have so much stuff, and in many cases managed to do it several times. 

The bankruptcy, second one yesterday of Sbarro, makes one wonder who lent them the money the second time, and what they got out of it, and what the executives did with all that borrowed hundreds of millions. And the possibility off laundered money from the mob cannot be ruled out either.

Bet your fanny they took their fortunes out early, in compensation, do not have repay it, and are living like little princes all over the world. 

When you owe $100,000 on  your mortage, you have a problem. When you owe $100,000,000 in unsecured or secured debt, your creditor has a killer headache. (which he will pass  off to his depositors). 


chemystical's picture

"Repudiation, bitches"

Ah, but which debts to repudiate?  How much of this is the flipside of rehypothecation?  If I don't pay Irving, Irving doesn't pay Schlomo, Schlomo doesn't pay investment and retirement funds A-Z, and...much of your wealth and 401K's go up in smoke.  Of course your contribution to servicing the current debt might go down as will that of your progeny.  What does that net out to? 

Disintermediation sucks if you're an intermediate.  otoh, if Schlomo takes a 99% hair cut on his ill-gotten mammon, then he's still ahead of the game and I wouldn't particularly care.

Evil Peanut's picture

Choice A - Revolution & the 99% retake the country

Choice B - Martial Law & the 1% keep their power and the 99% under their thumbs


watch this

cognus's picture

Total nonsense.  Social engineering has the 99% looking like a 'group' but there are a thousand factional fractures in the 'group'.  you can't muster 100 people to agree on anything long enough to pull a jailbreak, much less a revolt, which this time will require VERY sophisticated electronic/IT/software/hackery skills.

Total nonsense - the FIRST thing that would happen is corruption among the revolters, as Lenders who LOVE revolutions move in with bathtubs full of phony money to make rich the perceived leaders.  in other words, we're no diff from the 3rd world goons who fall EVERY TIME for the tricks of the bankster class.  LOANS to buy arms, LOANS to buy mercenaries, LOANS to pay conscripts, LOANS to build "roads and bridges" [i can't believe i just said that.... now everyone things I'm a leftie]

an immoral and godless people can hardly be ruled by homicidal sociopaths, much LESS be ruled by themselves.

Radical Marijuana's picture

Well, Evil Peanut, I have watched videos from Manning before. In my opinion, he is correct, on the level of analysis that he presents. However, he is way too optimistic and idealistic. I have no doubt that there will be democidal martial law, and that will not work ...

"Choice" A plus B: social chaos, followed by even more overwhelming environmental chaos, leaving nothing we could imagine to survive through that. The deeper problem is that nothing that merely might somewhat fix the runaway social polarization does anything adequate about the runaway destruction of the natural world, but rather, initially only makes that destruction of the natural world become even worse.

OccupyTVstations's picture

Then again, maybe choices A & B seem like the only options because that's what we've been told thru Hollywood propaganda.

Everyone wants a revolution, but nobody wants to protest in the streets (probably because they're tired of Answer, Code Pink, etc minders directing everyone to do something stupid and useless).

The solution is to use the internet to our advantage. They can't censor everyone.. so we start by asking all Constitution loving Americans to post #VoteNoConfidence ... or maybe #GTFO (Get The F$%# Out) for brevity- on blogs, msg boards, etc make it ubiquitous until the MSM has to address it.

Geraldo: "What do you mean GTFO?"

Citizen on the street: "We have no confidence in the entire government, President, Congress, Supreme Court. They are all traitors and we give them this choice- resign now and testify, or you will be prosecuted.


peaceful's picture

Yes everyone. It is a little known fact that throughout history, Debt is the number one reason for slavery. Then comes war, to be followed by crime. Racism is a very rare reason for slavery--these are facts anyone can find in an introductory Socio class. Yet we hear more about racism for what? 

Radical Marijuana's picture

Yeah, peaceful, when one looks at the history of sugar, one discovers that the economics of slavery came first, and then the racism followed after that. The first rule of ideology is that people rationalize how they make a living. Those who made a lots money from slavery developed racism as an ideology to justify them doing that.

Addicted to Pleasure - Episode Two: Sugar (BBC Documentary)

Ironically, most of the "political" techniques that we take for granted today, pro and con, in their modern forms can be traced back to the recent history of slavery and racism, being built and being abolished. Of course, the vast majority of human history before that was built on slavery systems. It is an interesting question to speculate about the degree to which slavery for long enough not only becomes cultural, but that the selected genetics favour that cultural conditioning, of both the masters and the slaves.

Of course, American slavery was not like that, but rather tended to be its opposite, since the masters bred with their slaves in America so much at at least one quarter of "blacks" are "white." That was the opposite to what one would predict in a "Brave New World" kind of slavery system, where people were systematically selected to have the kind of genetics which would be more suitable to being culturally conditioned to become slaves.

However, one thing which appears to have been quite constant throughout human history is that the ruling classes have been extremely concerned about their bloodlines, perhaps in part because they wanted their kind of cultural conditioning upon their offspring to work to produce the next generation of ruling classes. It is another interesting question to ask what might be the degree of genetic selection behind favouring the kinds of ruling classes who are so readily able to become psychopaths and sociopaths. Again, ironically there may well have been a sort of reverse racism, to select for the ruling classes to have propensities towards the criminally insanities which are so characteristic of the ruling classes. (Of course, that also opens up some "deep, hidden, history" speculations about "human" genetics. We may be all one species, but there are very different groups which have tended to only breed with themselves, for quite a long time!)

Ghordius's picture

excellent comment. yet imho it diverts from the fact that the three chief debt "instruments" are mortgages, US student debt and consumer credit

the first is tied to the risk of appreciating/depreciating real estate. nobody forces you to buy. though culture and politics (particularly Anglo-American ones, don't forget countries like Germany where 60% of the people live happily in rent - the horror!) nudge heavily

the second is unique, as far as I know. and... surprising for who thought that defaulting is a US citizen's right and custom, not defaultable

the third is again a cultural import for most of the world

so I claim that there is a modern culture of debt. and it's propagating centers are NY and London. meanwhile, the "rise of the debt serfs" is centered on the very Americans that are hogtied into student debt, and does not address this debt culture with a true counter-culture

consumerism. that simple. keeping up with the Joneses, "do your patriotic duty and shop 'till you drop". if you don't consume, it can't "trickle down"

doctor10's picture

All those "debt" instruments merely are, is a means to an end.

Those instruments are "wholesaled" to the public-in return for which the public essentailly holds out their wrists peacably  for the application of the shackles.

Those are the means by which the plantation owners-owners of countries and regions in the 21st century-have bound  their  slaves and their slaves' children-to the land -ad infinitum.


Round numbers are interesting. There are 7 billion on the planet presently. A common number thrown out regarding entire global debt is 700 trillion-suggesting that the world's financiers picked a number to tie to the tail of every living human.