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Kyle Bass: Fallacies Such As MMT Are "Leading The Sheep To Slaughter" And "We Believe War Is Inevitable"

Tyler Durden's picture


Below are some of the key highlights from Kyle Bass' latest, and as usual, must read letter:

On central banks and the final round of global monetary debasement:

Central bankers are feverishly attempting to create their own new world: a utopia in which debts are never restructured, and there are no consequences for fiscal profligacy, i.e. no atonement for prior sins. They have created Potemkin villages on a Jurassic scale. The sum total of the volatility they are attempting to suppress will be less than the eventual volatility encountered when their schemes stop working. Most refer to comments like this as heresy against the orthodoxy of economic thought. We have a hard time understanding how the current situation ends any way other than a massive loss of wealth and purchasing power through default, inflation or both.


In the Keynesian bible (The General Theory of Employment, Interest and Money), there is a very interesting tidbit of Keynes’ conscience in the last chapter titled “Concluding Notes” from page 376:


[I]t would mean the euthanasia of the rentier, and, consequently, the euthanasia of the cumulative oppressive power of the capitalist to exploit the scarcity value of capital. Interest today rewards no genuine sacrifice, any more than does the rent of land. The owner of capital can obtain interest because capital is scarce, just as the owner of land can obtain rent because land is scarce. But whilst there may be intrinsic reasons for the scarcity of land, there are no intrinsic reasons for the scarcity of capital.


. . .

Thus we might aim in practice (there being nothing in this which is unattainable) at an increase in capital until it ceases to be scarce, so that the functionless investor will no longer receive a bonus[.] (emphasis added)

This is nothing more than a chilling prescription for the destruction of wealth through the dilution of capital by monetary authorities.


Central banks have become the great enablers of fiscal profligacy. They have removed the proverbial policemen from the bond market highway. If central banks purchase the entirety of incremental bond issuance used to finance fiscal deficits, the checks and balances of “normal” market interest rates are obscured or even eliminated altogether. This market phenomenon does nothing to encourage the body politic to take their foot off the spending accelerator. It is both our primary fear and unfortunately our prediction that this quixotic path of spending and printing will continue ad?infinitum until real cost?push inflation manifests itself. We won’t get into the MV=PQ argument here as the reality of the situation is the fact that the V is the “solve?for” variable, which is at best a concurrent or lagging indicator. Given the enormity of the existing government debt stock, it will not be possible to control the very inflation that the market is currently hoping for. As each 100 basis points in cost of capital costs the US federal government over $150 billion, the US simply cannot afford for another Paul Volcker to raise rates and contain inflation once it begins.

Hayek was, of course, right:

The current modus operandi by central banks and sovereign governments threatens to take us down Friedrich von Hayek's “Road to Serfdom”. Published in 1944, its message, that all forms of socialism and economic planning lead inescapably to tyranny, might prove to have been prescient. In the 1970s, when Keynesianism was brought to crisis, politicians were vociferously declaring that attempting to maintain employment through inflationary means would inevitably destroy the market economy and replace it with a communist or some other totalitarian system which is the “perilous road” to be avoided “at any price". The genius in the book was the argument that serfdom would not be brought about by evil men like Stalin or Hitler, but by the cumulative effect of the wishes and actions of good men and women, each of whose interventions could be easily justified by immediate needs. We advocate social liberalism, but we also need to get there through fiscal responsibility. Pushing for inflation at this moment in time will wreak havoc on those countries whose cumulative debt stocks represent multiples of central government tax revenue.


The non?linearity of expenses versus revenues is what will bring them down.

"Pavlov's Party" is ending, and when it does, it will happen so fast no reaction will be possible:

Through travel and meetings around the world, it has become clear to us that most investors possess a heavily anchored bias that has been engrained in their belief systems mostly through inductive reasoning. Using one of the Nobel Laureate Daniel Khaneman's theories, participants fall under an availability heuristic whereby they are able to process information using only variables that are products of recent data sets or events. Let’s face it – the brevity of financial memory is shorter than the half?life of a Japanese finance minister.


Humans are optimistic by nature. People’s lives are driven by hopes and dreams which are all second derivatives of their innate optimism. Humans also suffer from optimistic biases driven by the first inalienable right of human nature which is self?preservation. It is this reflex mechanism in our cognitive pathways that makes difficult situations hard to reflect and opine on. These biases are extended to economic choices and events. The fact that developed nation sovereign defaults don’t advance anyone’s self?interest makes the logical outcome so difficult to accept. The inherent negativity associated with sovereign defaults brings us to such difficult (but logical) conclusions that it is widely thought that the powers that be cannot and will not allow it to happen. The primary difficulty with this train of thought is the bias that most investors have for the baseline facts: they tend to believe that the central bankers, politicians, and other governmental agencies are omnipotent due to their success in averting a financial meltdown in 2009.


The overarching belief is that there will always be someone or something there to act as the safety net. The safety nets worked so well recently that investors now trust they will be underneath them adinfinitum. Markets and economists alike now believe that quantitative easing (“QE”) will always “work” by flooding the market with relatively costless capital. When the only tool a central bank possesses is a hammer, everything looks like a nail. In our opinion, QE just doesn’t stimulate private credit demand and consumption in an economy where total credit market debt to GDP already  exceeds 300%. The UK is the poster child for the abject failure of QE. The Bank of England has purchased over 27% of gross government debt (vs. 12% in the US). UK bond yields have all but gone negative and are now negative in real terms by at least ?1%. Unlimited QE and the zero lower bound (“ZLB”) are likely to bankrupt pension funds whose expected returns happen to be a good 600 basis points (or more) higher than the 10?year “risk?free” rate. The ZLB has many unintended consequences that are impossible to ignore.


Despite reading through Keynes’ works, we didn’t find a single index referencing the ZLB or any similar concept. In his General Theory, there are 64 entries in the index under “Interest” but no entry for the ZLB, zero rates, or even “really low rates”.


Our belief is that markets will eventually take these matters out of the hands of the central bankers. These events will happen with such rapidity that policy makers won’t be able to react fast enough.

On the lunacy of such "modern" "economic" "theories" as MMT (which may or may not stand for "Magic Money Trees")

The fallacy of the belief that countries that print their own currency are immune to sovereign crisis will be disproven in the coming months and years. Those that treat this belief as axiomatic will most likely be the biggest losers. A handful of investors and asset managers have recently discussed an emerging school of thought, which postulates that countries, as the sole manufacturer of their currency, can never become insolvent, and in this sense, governments are not dependent on credit markets to remain fiscally operational. It is precisely this line of thinking which will ultimately lead the sheep to slaughter.

The inevitable end of that supremely flawed monetarist experiment - the Eurozone:

Each subsequent “save” of the European debt crisis has been devised by the Eurocrats coming up with some new amalgamation of an entity that is more complex than its predecessor that is designed to project size, strength, and confidence to investors that the problem has been solved. Raoul, a friend of mine who resides in Spain, put it best:


“Let’s just clear this up again. The ECB is going to buy bonds of bankrupt banks just so the banks can buy more bonds from bankrupt governments. Meanwhile, just to prop this up the ESM will borrow money from bankrupt governments to buy the very bonds of those bankrupt governments.”


The EFSF, the IMF, the ESM, and the OMT (and who knows what other vehicles they will dream up next) have all been developed to serve as an optical backstop for investors globally. The Eurocrats are sticking with the Merkelavellian playbook of hiding behind the complexity of these various schemes. All one has to do is review the required contributions to said vehicles from bankrupt nations to realize that the circular references are already beginning to show in broad daylight. Does anyone stop to consider that the two largest contributors to the IMF are the two largest debtor nations in the world? Are things beginning to make sense now?




In the end, the EMU won't look the same, if it exists at all.

And finally, a less than rosy outlook for the entire "developed" world.

Trillions of dollars of debts will be restructured and millions of financially prudent savers will lose large percentages of their real purchasing power at exactly the wrong time in their lives. Again, the world will not end, but the social fabric of the profligate nations will be stretched and in some cases torn. Sadly, looking back through economic history, all too often war is the manifestation of simple economic entropy played to its logical conclusion. We believe that war is an inevitable consequence of the current global economic situation.

All this and much more, including the usual detailed summary depicting the Japanese ultra slow-motion trainwreck (which is picking up speed as none other than Seiji Maehara, state minister for economic and fiscal policy, admitted yesterday when he said that "[The Japan economy] is in a dire state") in the full letter below:



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Sat, 11/17/2012 - 15:03 | 2991991 Ignatius
Ignatius's picture

Surf the collapse.

These cycles never end, though when identified they can be surfed.

Sat, 11/17/2012 - 15:23 | 2992037 hmmtellmemore
hmmtellmemore's picture

Take advantage of the idiots that believe in these central banks.  Let them lose their money instead of us.

Sat, 11/17/2012 - 15:24 | 2992045 centerline
centerline's picture

Those are the ones who think the ocean rushing away from shores is a curious sight (or asleep on the beach).

Sat, 11/17/2012 - 16:27 | 2992107 Michaelwiseguy
Michaelwiseguy's picture

People pushing Agenda 21 in the shadows are terrorists. We are driving them out of the shadows and exposing them to daylight. These Agenda21ers are treasonous traitors of the United States.

Media Panic to Control Exposure of Agenda 21 Takeover

This is why Huffington Post are always attacking Governor Rick Scott of my State of Florida.

Rick Scott, Agenda 21 and the United Nations

Florida Repeals Smart Growth Law

Sat, 11/17/2012 - 17:03 | 2992221 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

We can share ideas on how to profit, or we can revolutionize the world and still profit.  Take your pick.

Sat, 11/17/2012 - 18:02 | 2992311 Michaelwiseguy
Michaelwiseguy's picture

The Agenda21ers use psychological brainwashing techniques on us. They use of the Delphi Technique on us, and is well documented.

by G. Edward Griffin

Agenda21ers are psychological brainwashing Terrorists. Everyone is familiar with the words "Climate Change", it's psychological brainwashing terminology.

I figured it out. They're using fight club rules. Never talk about Agenda 21.

I say we declare war on the Agenda21ers. Kill 40 birds with one stone.

Sat, 11/17/2012 - 18:05 | 2992321 ratso
ratso's picture

Kyle Bass is a moron.

Sat, 11/17/2012 - 18:40 | 2992389 Dr. Sandi
Dr. Sandi's picture

I wish I had somebody that stupid handling my finances.

Sat, 11/17/2012 - 18:53 | 2992406 ratso
ratso's picture

Be careful what you wish for.

Now that the world did not end when Obama was elected and reelected, the fear mongers have to find new bogey men and monsters to induce us into make irrational fear based decisions that are not in our own best interest. 

Kyle Bass BOOO!

Sat, 11/17/2012 - 19:03 | 2992435 Jreb
Jreb's picture

This is the best you guys can do? "Kyle bass is a Moron" and the world didn't end?? Not "I think Kyle is wrong becausee... XYZ..." What is this - fucking high school??

Do you really think that global economic collapse has anything to do with Obummer being re-elected? He is a foot note in the history of our decay - a symptom of the larger disease.

But you're right guys - let's everyone buy US bonds, Apple and Haliburton. Times are good - in fact they'll never end because the guys pulling the levers obviously know what they are doing and have our best interest in mind. My apologies for thinking otherwise. I'll just shut up and go back to sleep... BTW - does anyone know what time "Dancing with the Stars" is on tonight???


Sat, 11/17/2012 - 19:14 | 2992453 mlbs
mlbs's picture

You fool! Any true fan of Dancing With the Stars knows what time it is on so well that they can set their clocks by it. I always knew I couldn't trust you.....

On an unrelated note. Would you be interested in buying my old iPod? It's the last piece of Apple hardware I own and I don't want it anymore. I'll sell it to you for one share of AAPL.

Sat, 11/17/2012 - 21:20 | 2992666 Jreb
Jreb's picture


Sun, 11/18/2012 - 00:18 | 2992976 DeadFred
DeadFred's picture

Efw semifinals with the best of the best competing and you don't even know it's on MONDAY!!!

Sun, 11/18/2012 - 00:52 | 2993044 Michaelwiseguy
Michaelwiseguy's picture

Why do Progresser News Headlines, like those found on Huffington Post, always have to be in the form of a vague question?


I very rarely click on any of their stories.

Sun, 11/18/2012 - 02:00 | 2993139 markmotive
markmotive's picture

Again, the inflationists / deflationists battle rages on.

Harry Dent is out there saying the Dow will hit 6000


Sun, 11/18/2012 - 05:04 | 2993233 IBelieveInMagic
IBelieveInMagic's picture

The debt to GDP ratio for OECD countries when combined with commodity countries such as Middle East (virtual colonies) may not be as bad some imagine. I think this beast can take on some more debt before the final collapse.

Sun, 11/18/2012 - 09:34 | 2993355 GetZeeGold
GetZeeGold's picture



Kyle Bass doesn't care who won the last election......he's got gold.


While the unions grovel at Bam Bam's feet......Kyle just sits back and chuckles.

Sat, 11/17/2012 - 19:21 | 2992475 I am on to you
I am on to you's picture


Its five past loneliness !!

Sat, 11/17/2012 - 19:22 | 2992477 Michaelwiseguy
Michaelwiseguy's picture

It has something to do with Democrats learning their math lessons and Obama getting the blame. That's the main reason for getting him reelected in conjunction with Revenge.

Alex Jones Caller Ron Paul Revenge Voters For Obama 11/09/2012

For Pure Unadul­ter­at­ed Re­venge. That's all this is about.

Sat, 11/17/2012 - 20:12 | 2992555 tango
tango's picture

Do you not get it? Articles with depth, complexity and three syllable words are automatically dismissed by those who read about half before giving up.  They're not "entertaining" - no dark conspiracies or wild rumor of the hour.    Most posters missed the salient point:  investors and citizens, because they have never known differently, consider constantly rising debt without consequences as "normal".  Most "experts" will earnestly state that as long as interest rates remain low we can "handle the borrowing" (like Spain, with 25% unemployment can manage debt at 6% but not 7%).  We can continue to have trillion dollar debts, monetize the deficit and buy our way out of trouble and all will be well. 

Sat, 11/17/2012 - 20:25 | 2992579 macholatte
macholatte's picture



The genius in the book was the argument that serfdom would not be brought about by evil men like Stalin or Hitler, but by the cumulative effect of the wishes and actions of good men and women, each of whose interventions could be easily justified by immediate needs.


I'm not so sure folks like Obama, Clinton and Soros are so well meaning. 

Sat, 11/17/2012 - 20:48 | 2992625 Michaelwiseguy
Michaelwiseguy's picture

The international bankster arrest list is getting very long.

Bankers and Brokers and Inside Traders Arrested, Oh My!

DAVID WILCOCK with DRAKE Interview 29March2012

Now Elizabeth gets to do what I supported her for. Elizabeth Warren: 'Libor Fraud Exposes Rot At The Core Of The Financial System' 




Sat, 11/17/2012 - 23:50 | 2992921 Michaelwiseguy
Michaelwiseguy's picture

The UN needs to be brought up on Criminal Charges for using Psychological Brainwashing Tactics on the American People!

Sun, 11/18/2012 - 00:24 | 2992991 DeadFred
DeadFred's picture

Iread the article but didn't see any arrests of anyone from a big bank. Hmmm I wonder how I missed it.

Sat, 11/17/2012 - 23:32 | 2992883 Imminent Crucible
Imminent Crucible's picture

macholatte: "I'm not so sure folks like Obama, Clinton and Soros are so well meaning."

That was my thought. What good men and women is he talking about? Obama, Clinton, Soros........horns, hoofs, pitchfork.

Sun, 11/18/2012 - 09:51 | 2993368 TeamDepends
TeamDepends's picture

Seems clear to us he is refering to "useful idiots".  In the U.S. these people are known as Obamanauts, the walking embodiment of the old adage:  The road to Hell is paved with good intentions.

Sun, 11/18/2012 - 00:10 | 2992962 IndicaTive
IndicaTive's picture

It's not on tonight. Duh.

Sun, 11/18/2012 - 06:14 | 2993254 samcontrol
samcontrol's picture

you should watch the Argentine version , it,s called showmatch. True entertainment.

Sun, 11/18/2012 - 06:16 | 2993257 samcontrol
samcontrol's picture

roland , go fuck yourself!

Mon, 11/19/2012 - 11:51 | 2995904 WhiteNight123129
WhiteNight123129's picture

Jean Jaures was an awful fear mongerer, after all the world did not end because of World War I, a lot of people died and pensioners were ruined, but hey, the world did not end. Same thing with Churchill, he wanted to attack Hitler before he became too powerful and erase the threat. Another awful fear mongerer again. Did the world end with World War II, not at all. More people got killed and more people lost their pensions.

Ok now if you are trying to say that a world war is not the end of the world and people getting wacked with their savings is business as usual in the greater scheme of things than yes you are right. You just have a lot more cold blood than maybe have on this blog including me. On the other hand, if you think that the world is a rosy place nice and happy, go back watching the Teletubbies or if you have a light bubble spinging in your head right now, go and read a LOT of history to understand how the world really works.



Sat, 11/17/2012 - 19:12 | 2992451 SingleCross
SingleCross's picture

Ad hominin

Sat, 11/17/2012 - 23:41 | 2992900 ratso
ratso's picture

No, its his classification - its his phylum.

BTW, you obviously never took Latin.

Sun, 11/18/2012 - 15:52 | 2994130 Blankenstein
Blankenstein's picture

And obviously you failed elementary school grammar.  


"No, its his classification - its his phylum."

"induce us into make irrational fear based decisions "

Sat, 11/17/2012 - 19:25 | 2992481 tsx500
tsx500's picture

good one , idiot .    how long did it take you to come up with that one ?

Sat, 11/17/2012 - 20:13 | 2992560 Anonymous peon
Anonymous peon's picture

If only Bernanke were as much of a moron.

Sat, 11/17/2012 - 20:17 | 2992564 Rick Blaine
Rick Blaine's picture

For all I know, you were joking...but in case you weren't...

OK, so if Kyle Bass is a moron, who ISN'T a moron?

The Bernanke?  Geithner?  All the "experts" who were literally laughing out loud, on the air, at Peter Schiff back in '05?

For all I know, Bass simply got lucky with the housing market and Greece...and maybe he's really not that smart or whatever...

However, even if they were guesses, at least he got something right over the past few years... opposed to Bernanke, for example, whose correct economic predictions of the past seven years are shown on the list below:



(end of list)


Sat, 11/17/2012 - 20:40 | 2992616 knukles
knukles's picture

Oh, I've an addition to the list:

Sat, 11/17/2012 - 21:32 | 2992688 xtop23
xtop23's picture

Ive rarely heard a moron speak so eloquently or perform research so exhaustively. kyle is no fool. you however......... oy

Sun, 11/18/2012 - 01:35 | 2993099 Daily Bail
Daily Bail's picture

And you Ratso are a fucktard propenent of MMT, and never-ending deficit spending to keep your team (who's the same as the other team) in power.  Trillion-dollar deficit spending at this point in our cycle is nothing less than generational RAPE of the young and unborn.

Galbraith, Marshall Auerback, probably that fucktard Brad Delong, and other MMT dipshits can kiss my ass.  Move to Zimbabwe, I hear there are job openings.

Meanwhile In Zimbabwe: 9 Million Percent Inflation


Sun, 11/18/2012 - 11:35 | 2993518 TeamDepends
TeamDepends's picture

One:  The more I hear of this Kyle Bass character, the more I like the cut of his jib.

Other:  Dja' know he has shit-tons of gold in his basement?

One:  All Hail Exalted Leader Bass!!!

Sun, 11/18/2012 - 01:33 | 2993096 Big Slick
Big Slick's picture


Sun, 11/18/2012 - 03:30 | 2993200 dunce
dunce's picture

Smart growth and smart diplomacy both have a contemptous ad hominem refutation built in thier names, any one that disagrees with the policies is stupid.

Sun, 11/18/2012 - 13:39 | 2993770 SmittyinLA
SmittyinLA's picture

Ca's growth & development policies are why a 1300' 75 year old house  in the City of Bell Ca which should cost at the most $90,000 and do in every other state sells for $350, CA.

 California's citizen written bankruptcy law will fix everything when we void all unsecured debts and void all unfunded liabilities and sell off state lands_to only resident citizens.


Sat, 11/17/2012 - 16:05 | 2992113 Top_Kill
Top_Kill's picture

"But whilst there may be intrinsic reasons for the scarcity of land, there are no intrinsic reasons for the scarcity of capital."

We will quickly see a scarcity of physical tradition (GOLD).  Bernake will learn this very soon. How long until the US is secretly buying gold. I put the over under at 27 months. What says you?

Sat, 11/17/2012 - 17:05 | 2992222 HurricaneSeason
HurricaneSeason's picture

With our budget problems? Tungsten abd ETFs are cheaper. China will outbid us with treasuries.

Sun, 11/18/2012 - 01:38 | 2993100 Big Slick
Big Slick's picture

"How long before the US government is secretly buying gold?"

They'd have better luck secretly buying Twinkies

Sun, 11/18/2012 - 10:55 | 2993434 gaoptimize
gaoptimize's picture

US Gold Reseserve:  8,133 X 1000 X 2.2046 X 16 X (let's use) $1,800/oz  = $516B

China's US debt holdings: $1,164B (June 2012 reported August 2012)

So yeah, they may take it in partial payment.

Sat, 11/17/2012 - 15:54 | 2992097 john39
john39's picture

Unless you belong to the controlling class, you are a slave, subject to their every whim. Sure the idiots are pathetic, but at some point those who know better must act as there will be no hiding from what they have planned.

Sun, 11/18/2012 - 11:49 | 2993550 TeamDepends
TeamDepends's picture

Amen.  We can't wait to see the looks on the faces of the useful idiots when they realize they have become useless idiots.  Priceless.

Sun, 11/18/2012 - 20:11 | 2994682 Bag Of Meat
Bag Of Meat's picture

I fear the day I will realise that idiots will always remain idiots, and that my only choice is to stick with the elite...

Sat, 11/17/2012 - 19:17 | 2992466 Peter Pan
Peter Pan's picture

There is only one central bank. It's bank manager is gold and it's teller is silver. Society is about to begin a prolonged period of profound and often troubling and painful paradigm shifts as it searches for a new sustainable equilibrium.

The world has to re-open under new management. Hopefully that new management will be a new attitude rather than one world government.

Sat, 11/17/2012 - 23:34 | 2992888 Dr. Sandi
Dr. Sandi's picture

I wanna open an account in this bank. Will you take this here government check?

Sat, 11/17/2012 - 20:04 | 2992545 Zero Govt
Zero Govt's picture

@ Hmm - "Take advantage of the idiots that believe in these central banks.  Let them lose their money instead of us."

MBD's your man

Sat, 11/17/2012 - 15:23 | 2992038 centerline
centerline's picture

Some can't swim.

Sat, 11/17/2012 - 15:37 | 2992073 Ignatius
Ignatius's picture

But everyone can shit, and that's a real clue as to what to expect.

Sat, 11/17/2012 - 15:43 | 2992077 centerline
centerline's picture

+1.  Hate to say it but there are a few people I know who deserve it.  Freakin parasite wannabes.

Sun, 11/18/2012 - 09:50 | 2993364 GetZeeGold
GetZeeGold's picture



But everyone can shi....


The really classy ones do it on cop cars and sidewalks. They say they talk for me....they don't

Sat, 11/17/2012 - 15:23 | 2992043 Michaelwiseguy
Michaelwiseguy's picture

If we're going to have a war, I say we declare it on the globalists banking cartel, and Agend21ers.

Sun, 11/18/2012 - 12:02 | 2993578 DarkestPhoenix
DarkestPhoenix's picture

I'm getting my Master of Real Estate, and I can tell you.............they are everywhere.

I do like poking holes in their logic, though.  Great idea, but completely impractical.

"Hey, how about we all graft jetpacks into our shoulder blades and just fly everywhere and turn all the old roads and airports into farms where we grow all our community food?"

Great idea, but completely impractical. 

Sat, 11/17/2012 - 16:06 | 2992122 fasTTcar
fasTTcar's picture

But, isn"t China supposed to stop the collapse?

Charlie don't surf.

Sat, 11/17/2012 - 23:48 | 2992917 Spitzer
Spitzer's picture

Isn't allot of things supposed to happen ?

I read half way through it and realized.. what is the point ? Its all the same stuff, year after year. Ever since 2008. Not that anything is wrong with what guys like him write but its such a long painful wait. No monumental events since 08. Who would have thought that this game would have lasted through Obama's term ? Now I could see it lasting another 4 years. And in those 4 years, Kyle Bass will be saying the same thing.

Sun, 11/18/2012 - 00:06 | 2992953 Crisismode
Crisismode's picture

And so will you.


Much to your dismay.



Sun, 11/18/2012 - 00:30 | 2993004 Maos Dog
Maos Dog's picture

What can someone say to this?

Only the following:

"at first very slowly, then all at once"

Sun, 11/18/2012 - 01:49 | 2993125 Big Slick
Big Slick's picture

"at first very slowly, then all at once"

... A constructive rebuttal to Spitzer's point, which is a good one and worthy of consideration.  I'd expand on the uncertainties of market timing, but I'm too tired and I'm driving to Austin in the morning to see rich europeans drive obscenely expensive race cars around in a circle.  Fittingly symbolic, a German is probably going to win.

Oh hell, I'll add one thing: "The greatest shortcoming of the human race is our inability to understand the exponential function." - Albert Bartlett

Sun, 11/18/2012 - 02:34 | 2993166 OneTinSoldier66
OneTinSoldier66's picture

You're not alone. I think of it as waiting for some libertarianism. The push against allowing any libertarianism is tremendous.


Did you see what happened when Gov. Scott Walker stood up to the Public Sector Unions in Wisconsin? So that the Taxpayers there could finally get some representation? The Capital had union thugs and protesters hanging all over the walls for days on end, on occasion there were threats of life and limb, democrat politicians went awol and fled the state, and there were recall elections. That was just a little slice of libertarianism, and a person could have thought that the earth was going to crack open and everyone was going to fall in!


Unfortunately, Jacob H. Hubert was right when he said... "Libertarianism is not for people with a high time preference."


However, although I have previously been guilty of the following, I believe libertarians should not try to assert themselves above the authoritarians/statists by trying to foist some idea/agenda of how believe things should be... by the use of force, coercion, or violence. That would be stooping to the level of the statists and turning into the very thing libertarians claim to oppose. So as Jacob H. Hubert would say, I have to be patient and improve the one unit of society that I am able to improve, myself. Then, hopefully, people will be naturally drawn to libertarians and libertarianism.

Tue, 11/20/2012 - 16:18 | 2999739 ViewfromUnderth...
ViewfromUndertheBridge's picture

Well, while you were counting the time it took KB rode the sub-prime wave, then he rode the Greek CDS wave, now he is riding non-agency MBS wave (back-wash that one) and setting himself up for the Japanese Tsunami...sounds kinda fast moving to me.

What did you do?

Sat, 11/17/2012 - 18:05 | 2992319 lipskid
lipskid's picture

You can't stop the waves, but you can learn how to surf. - Jon Kabat-Zin

Sun, 11/18/2012 - 00:10 | 2992963 Lord Koos
Lord Koos's picture

Try surfing the collapse when you or your kids get drafted.

Sun, 11/18/2012 - 13:50 | 2993804 Things that go bump
Things that go bump's picture

They prefer their all volunteer force.  People don't care how many wars they fight as long as they aren't forced to participate.  

Sun, 11/18/2012 - 20:32 | 2994727 slyhill
slyhill's picture

No need for a draft when you can CTRL P. An employee is also a volunteer.

Sun, 11/18/2012 - 12:15 | 2993603 Miramanee
Miramanee's picture

RE: “Let’s just clear this up again. The ECB is going to buy bonds of bankrupt banks just so the banks can buy more bonds from bankrupt governments. Meanwhile, just to prop this up the ESM will borrow money from bankrupt governments to buy the very bonds of those bankrupt governments.”


YES. Same is the U.S. The Fed makes "whole" the banks by taking toxic assets off of their balance sheets. The government allows the banks to avlue their assets however they desire, with NO regard for their value in the open market. It is a quadrillion dollar shell game. And the logical mind would conclude that this must end badly: a fiat currency game of chicken. Don't mind the man behind the curtain!! BUT....and we have to address this question lest we fally prey to rigid thinking...what happens in a world in which this charade goes on for another 50 years, or more? Does inflation price the middle class into abject serfdom? Does the discovery and exploitation of new technologies "save" the world from itself? Is it better to kick the can ad infinitum in hopes that cold fusion (metaphorically) takes humanity to a new place...essentially bypassing the midfield and staving off collapse? We've been on this road for approaching a century. Nixon defaulted on our gold obligations in 1971. What makes us so sure we cannot go like this for generations to come??? And....what does collapse look like? All questions that I believe we must be willing to discuss, rather than simply express our collective rage at a system that willingly lets billions suffer and die.

Sun, 11/18/2012 - 13:03 | 2993685 Meremortal
Meremortal's picture

"We advocate social liberalism, but we also need to get there through fiscal responsibility."


Now that right there is funny.



Sat, 11/17/2012 - 15:04 | 2991995 Water Is Wet
Water Is Wet's picture

And I believe water is wet.

Sat, 11/17/2012 - 15:08 | 2992009 eatthebanksters
eatthebanksters's picture

Guns, ammo, canned food, flour, rice, beans and a hide away in the mountains with a couple of good horses would be a good thing to have when it starts to unwind.

Sat, 11/17/2012 - 15:59 | 2992110 Obadiah
Obadiah's picture

I say "No! fuck the international banking cartel, get the fuck away from US.  The US States.  We dont want or need your fake fiat dreams of contol any longer.  We call the shots Fuck You! Get Out!"

Sat, 11/17/2012 - 17:28 | 2992260 supafuckinmingster
supafuckinmingster's picture



Sat, 11/17/2012 - 17:56 | 2992307 THX 1178
THX 1178's picture

You said it.

Sat, 11/17/2012 - 18:05 | 2992322 fuu
fuu's picture

Your search - iou09yk7ou9p'50g8jyui8895t7uyuutu - did not match any documents.

Sat, 11/17/2012 - 20:44 | 2992623 Jendrzejczyk
Jendrzejczyk's picture

Nickels Bitchez.

Sat, 11/17/2012 - 15:31 | 2992010 Zero Govt
Zero Govt's picture


 "We Believe War Is Inevitable"


Unless the people take charge back as it should be instead of leaving it in the scum hands of politicians/bwankers ...Press the 'Nuke' button people..

Stop Paying Tax ...Kill the Suckers in One Easy-Peasy Flick of the Wrist


Sat, 11/17/2012 - 15:31 | 2992062 Ballin D
Ballin D's picture

Theyre spending money they dont have already.  Whats the difference between spending more than they collect and spending more than they collect?

Sat, 11/17/2012 - 16:11 | 2992067 Zero Govt
Zero Govt's picture

Who Cares!

We either take this destructive human scum out or they murder another 100-500,000 innocents in some geo-political genocide game

It's recovery or trainwreck, peace or war, us or them...this is a no brainer if ever there was (don't expect Statists like Kyle Bass to figure out you've got an option, that society can dictate terms)

Sat, 11/17/2012 - 18:43 | 2992394 Dr. Sandi
Dr. Sandi's picture

Got a list a little deeper than the famous talking heads?

Sat, 11/17/2012 - 21:27 | 2992679 FrankDrakman
FrankDrakman's picture

Murder another 100-500,000 innocents

Think you're off by a factor of 10 or so..

Sat, 11/17/2012 - 17:12 | 2992232 HurricaneSeason
HurricaneSeason's picture

It's all psychological. China's goal is to create 25 million jobs a year. Why not let the poverty-stricken Chinese  have the new flat screens and gas by letting the value of their currency explode when we get to where we can't even pay the interest on the debt. Then they can dump their U.S. treasuries on the market and claim the reserve currency. That has to be their plan and it seems the BRICs and every other country we've pissed of lately would go along. At least we'll have food, even if the semis taking to the ports need to be robbed. Egypt and Israel are in a desert.

Sat, 11/17/2012 - 15:37 | 2992072 THECOMINGDEPRESSION

Buy Gold And Silver..convert the fake fiat into bullion. That will take care of everything..including governments. they thrive on DEBT..

Sat, 11/17/2012 - 16:35 | 2992167 augustus caesar
augustus caesar's picture

Change the word 'believe' to 'hoping'

Sat, 11/17/2012 - 23:51 | 2992925 Flying Tiger Comics
Flying Tiger Comics's picture

War is inevitable because megadeath makes labour more expensive but only after making it effectively free- to build large public works that in turn add to the profits and churn of the banking class.


War also causes reactionary forces which preserve the existing feudal system or creates a false revolution where the same system merely renames and rebadges itself.

Sat, 11/17/2012 - 15:09 | 2992011 t_kAyk
t_kAyk's picture

We are out of ideas!!  Shoot something!! 

Sat, 11/17/2012 - 17:44 | 2992289 JPM Hater001
JPM Hater001's picture

Can we just start a war instead?

Sat, 11/17/2012 - 18:43 | 2992395 Dr. Sandi
Dr. Sandi's picture

How many do we need?

Sat, 11/17/2012 - 20:44 | 2992622 knukles
knukles's picture

Another one or two, but really depends on big or small as well as the participant list.

Might start with the Gog and Megog one just for shit and grins.

Sat, 11/17/2012 - 23:29 | 2992875 Dr. Sandi
Dr. Sandi's picture

Oooh, you got Apocalypse all over my Financial Collapse.

Sun, 11/18/2012 - 11:59 | 2993563 GoinFawr
Sat, 11/17/2012 - 15:11 | 2992016 AnAnonymous
AnAnonymous's picture

Another 'american' genius.

War is unavoidable.

What war? 'Americans' have been at war for centuries now.

Quite a prediction, calling for something that is already happening...

Sat, 11/17/2012 - 15:19 | 2992032 faustian bargain
faustian bargain's picture

What war indeed. Until I see war in my neighborhood, there is no war, Mr Smug McSnarkypants.

Sat, 11/17/2012 - 18:44 | 2992397 Dr. Sandi
Dr. Sandi's picture

When mortar attacks take out the local Wal-Mart, then we have REAL war.

Sat, 11/17/2012 - 15:19 | 2992035 TPTB_r_TBTF
TPTB_r_TBTF's picture



he is predicting a war so big

that you will lose your internet connection.


Sat, 11/17/2012 - 15:23 | 2992039 hmmtellmemore
hmmtellmemore's picture


Sat, 11/17/2012 - 15:24 | 2992041 fonzannoon
fonzannoon's picture

I lost power for 5 days during Sandy. Finally it came back on and I was so happy I can't explain it. Electric and heat came back on. The TV/Internet was still out. I could not care less. Then after 25 minutes I was all aggrevated.

Sat, 11/17/2012 - 15:28 | 2992056 centerline
centerline's picture

No more free porn?  Dear god.

Sat, 11/17/2012 - 16:55 | 2992203 Tinky
Tinky's picture

You neglected to capitalize "Porn".

Sat, 11/17/2012 - 21:18 | 2992663 archon
archon's picture

Now THAT would mean WAR!!!

Sun, 11/18/2012 - 07:26 | 2993278 Svendblaaskaeg
Svendblaaskaeg's picture

Damn - There Goes the Neighborhood

Sun, 11/18/2012 - 07:28 | 2993279 AnAnonymous
AnAnonymous's picture

he is predicting a war so big

that you will lose your internet connection.


If that is the definition of a war so big, I can make it happen in a few days...

Sun, 11/18/2012 - 07:38 | 2993287 TheFourthStooge-ing
TheFourthStooge-ing's picture

AnAnonymous said:

If that is the definition of a war so big, I can make it happen in a few days...

Yeah, yeah, fantasy piling on fantasy, return to reality is troublesome for AnAnonymous Chinese citizenism middle class citizens...

Sat, 11/17/2012 - 15:27 | 2992054 centerline
centerline's picture

Still continuing to play the fool.  Either tragically lacking a frame of reference or failing miserably to be a proper troll.  A one trick pony.

Sat, 11/17/2012 - 16:36 | 2992155 Urban Redneck
Urban Redneck's picture

It is probably difficult to grind out an existence as a troll, when fastidiously propagating unapproved feces can result in someone from an organ of the Politics and Law Commission knocking your door and announcing that "you are now an organ donor!", leaving the poor troll with nary an opportunity to declare that the major powers' ever expanding dominion over their respective domains and citizenry is inherently a cancer- regardless of the State standard's colors.

Sat, 11/17/2012 - 17:59 | 2992310 sessinpo
sessinpo's picture

using your logic, almost every nation has been at war for centuries now. However, most of us, unlike you, are able to take things into context. What is really funny is how ironic it is for you to make a "genius" statement when you display the same thing.

Sun, 11/18/2012 - 05:03 | 2993232 AnAnonymous
AnAnonymous's picture

using your logic, almost every nation has been at war for centuries now.

What logic? The logic of labelling war war when it is convenient? That's the 'american' logic.

Non sequitur by the way, as what the others did is irrelevant.

The statement is by an 'american' genius who states that war is inevitable when 'american' nations are warring on multiple fronts, invading front, left and center and right.

And you'll have to back up a claim that people in the past had that lax attitude, denying war when there is war.
In a nutshell, people in the past might be constantly warring but they were not concealing they were warring. Avoiding some genius statements like that 'american''s, with war being unavoidable when multiple wars are already on.

Sun, 11/18/2012 - 06:06 | 2993250 TheFourthStooge-ing
TheFourthStooge-ing's picture

AnAnonymous said:

using your logic, almost every nation has been at war for centuries now.

What logic?

Agreedment of this. Veracity of AnAnonymous Chinese citizenism speechings having eternal nature inherently of anti-logic applied with diligence strongly.

Non sequitur by the way, as what the others did is irrelevant.

Again in this agreedmentation. AnAnonymous rewritement of history being self encapsulated. Wordings and actions of others not a bearing on this constitute.

Sun, 11/18/2012 - 07:29 | 2993280 AnAnonymous
AnAnonymous's picture

Yeah, yeah, fantasy piling on fantasy, return to reality is troublesome for 'americans'...

Sun, 11/18/2012 - 07:33 | 2993283 AnAnonymous
AnAnonymous's picture

However, most of us, unlike you, are able to take things into context.

Who is that "most of us"? That "most of us" must not include 'americans' as 'americans' are unable to admit that this world is an 'american' world, meaning that the general context is 'americanism"

So here, better to say something like that:

"However, most of us, americans, unlike you, are able to deny the most obvious fact to sink into fantasy. War does not exist by itself. War is only what we term to be war. If we decide today to call something war, that would be war. This is how we build one generality"

Want an easy way to avoid the unavoidable war as 'predicted' by this 'american' author?

Very easy. Just deny that the war this guy predicts is war. War avoided. And 100 pc 'american' way of dealing with reality.

Sun, 11/18/2012 - 08:26 | 2993292 TheFourthStooge-ing
TheFourthStooge-ing's picture

Lame repeation. Chinese citizenism middle class style of.

Sat, 11/17/2012 - 15:13 | 2992020 zilverreiger
zilverreiger's picture

wheres the video

Sat, 11/17/2012 - 15:13 | 2992021 in4mayshun
in4mayshun's picture

I have to disagree on one point: I do believe that life, as we know it, WILL indeed end. With no local farmers and centralized distribution all over the world, and no self-sustainability left...How can it not?

Sat, 11/17/2012 - 15:25 | 2992050 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

The dollar is not a real force.  It was created in alchemy and used to blind mankind.  It isn't that we don't need it, it is that once it is gone we will be better off.

People will trade goods and services as they once did; barter and with gold and silver used as money.

Sat, 11/17/2012 - 15:51 | 2992088 imbrbing
imbrbing's picture

"People will trade goods and services as they once did"

Those of us that are left will do so.

Sat, 11/17/2012 - 16:12 | 2992133 SeattleBruce
SeattleBruce's picture

"People will trade goods and services as they once did"

And whatever government entities remain will try desperately (backed by guns/courts/guns/prisons) to get in the middle of such transactions - or their tax base will be totally gone.  It aint gunna be like others have said, it's probably best at that point to be away from population centers which will have lots of police and government and government dependents demanding that those that have the ability to raise and/or secure food, feed them.

Sat, 11/17/2012 - 17:32 | 2992267 Supernova Born
Supernova Born's picture


"This food is the property of Mohamed Farrah Obama Aidid!"

.50 cal into the crowd.

ChiCom stealth helo (tech courtesy of the Bin Laden raid) hovering above with the crew laughing their ass off.

Big war, the kind you can't ignore.

Sat, 11/17/2012 - 17:51 | 2992290 EscapingProgress
Sun, 11/18/2012 - 10:45 | 2993420 Cloud9.5
Cloud9.5's picture

Miami when the lights go out.

Sun, 11/18/2012 - 03:03 | 2993181 in4mayshun
in4mayshun's picture

We're not talking about a new pair of Jordan's and a Slim Jim snack. People will only buy essentials, and when the trucks stop delivering food and clothing what could you possibly sell me that I would be willing to trade gold/silver for? If the world was comprised of local farmers and small family businesses, you're right, we could revert back to barter. In a world of Walmarts and Costcos however, barter would be quite useless.

Sat, 11/17/2012 - 15:34 | 2992066 centerline
centerline's picture

If you frame it in the context of "as we know it," then I think you arew 100% correct.  The question is how painful and fast the transistion will be.

I have voiced my opinion many times that so much of our current existence is based on complex supply chains.  So much specialization and dependancy.  So much complacency, laziness, obesity, frustration, greed, etc.  We have one hell of a lesson coming.  Big business, big oil, big government, etc. played off of all the human vices... into a massive ponzi scheme of perpetual growth.

Sat, 11/17/2012 - 16:14 | 2992137 SeattleBruce
SeattleBruce's picture

"We have one hell of a lesson coming."

Well said...

Sat, 11/17/2012 - 18:46 | 2992400 Dr. Sandi
Dr. Sandi's picture

Life as we know it ended when everybody got a cellphone. Except me, apparently.

Now we're at the mercy of billions of other people all wanting a piece of our time and a little of our life force.

Change happenened when you weren't looking.

Sat, 11/17/2012 - 19:53 | 2992521 centerline
centerline's picture

I didn't get one either.  And wouldn't take one.  Every leg up I have been given has paid back twicefold.  Everything borrowed is returned cleaner than I got it (and repaired/restored in many cases).  I teach the same to my kids.  Karma and honor are critical.

The real problem begins when the gravy train ends for those who take more than they give.

Sat, 11/17/2012 - 23:40 | 2992902 Dr. Sandi
Dr. Sandi's picture

My hat is off to you.

Or at least, it would be, if somebody hadn't borrowed it without giving it back.

And as I remember, Gravy Train is also a dry dog food. Is that where this is all headed?

"Chow down friends, this may be the last kibble we see for awhile."

Sat, 11/17/2012 - 15:13 | 2992022 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

I am getting bored with everyone elses ideas.

How about we put it simply:  Finance is a ponzi based on nothing other than good will and credit, the credit is based on the ability to pay and the good will was never present, and no one can pay their debts.

Sat, 11/17/2012 - 15:20 | 2992036 resurger
resurger's picture

And they want "Growth"


Sat, 11/17/2012 - 18:48 | 2992403 Dr. Sandi
Dr. Sandi's picture

It's always painful to have any growth removed.

Sat, 11/17/2012 - 21:56 | 2992717 DosZap
DosZap's picture

Bro Hendrix,

I agree w/ the Ponzi, just not the rest, for 50+ odd years it worked, because people were basically  honest, we had some mores and values.Government although corrupt in many areas, did seem to punish the obvious evil doer's, and criminals.

And you did not get loans unless you were a good credit risk(this is PC crap from .Goobers again),who mandated,even fined and sued to get loans to anyone who asked,this was the beginning of the Housing bubble.

Not so now, no one pays(almost) due to no jobs,loss of income, and general loss of faith in the NEW system put in place.

Crime is rewarded at the TOP levels by the Govt, and things that do not amount to a pile of crap, are prosecuted to the nth degree possible( the Sheeple).


All this means nothing if you are speaking of NOW.Then you sir are dead on.

Sun, 11/18/2012 - 09:35 | 2993357 e-recep
e-recep's picture

i am with you, it was not always this bad. people tend to forget the good times when credit flew to only those who were worthy of it.

Sat, 11/17/2012 - 15:16 | 2992027 americanspirit
americanspirit's picture

War is always inevitable. What is not always inevitable, but which does happen occasionally though far too infrequently, is that the rich and the powerful are marched to the center of town and their heads cut off.

Sat, 11/17/2012 - 15:23 | 2992042 dracos_ghost
dracos_ghost's picture

And that's why the rich and powerful use government institutions to give away "free money" to the masses so it doesn't happen. Throw in apathy in the middle class and TPTB are Bi-Winning. The only way we get back to what you're saying is create a Reality TV show.

The sheeple are the problem. Have to root for elitist vs elitist carnage at this point otherwise Orwell was right.

Sat, 11/17/2012 - 15:35 | 2992068 Pool Shark
Sat, 11/17/2012 - 15:45 | 2992081 centerline
centerline's picture

Both.  Huxley's world comes before Orwell's.

Sat, 11/17/2012 - 17:16 | 2992239 Virginian
Virginian's picture


Sun, 11/18/2012 - 04:28 | 2993225 wahrheit
Sat, 11/17/2012 - 16:17 | 2992141 SeattleBruce
SeattleBruce's picture

"but which does happen occasionally though far too infrequently, is that the rich and the powerful are marched to the center of town and their heads cut off."

To be replaced by other 'rich and powerful' corrupted manipulators and interest groups - if we're not careful during the reset.

Sat, 11/17/2012 - 18:49 | 2992410 Dr. Sandi
Dr. Sandi's picture

The major problem with the scenario is also its major charm.

While I like the idea of cutting off a lot of nasty heads, I don't like the idea that the people in charge are a little too okay with mass murder.

Sat, 11/17/2012 - 20:52 | 2992634 Nick Jihad
Nick Jihad's picture

Because that worked out so well in soviet Russia, maoist China or the Cambodia under the khmer rouge.

Sun, 11/18/2012 - 06:29 | 2993247 Jam Akin
Jam Akin's picture

Wouldn't it be more just (and fun) to dispossess the criminal rich/powerful of all ill gotten gains while poking fun at their excesses then banish them to a trailer park for the rest of their short nasty brutish lives?  Could be the makings of some entertaining reality TV.

Sat, 11/17/2012 - 15:23 | 2992028 sasebo
sasebo's picture

I'm just very glad to see there's someone who can elucidate what's really going on -----

In practical terms it says that banks & the fed can't print & sell money at interest forever ------------- you'll wind up with so much money it becomes worthless. Infinity divided by zero equals ?  

Sat, 11/17/2012 - 15:19 | 2992031 A Lunatic
A Lunatic's picture

Baaaaaaaaaaa, bitchez.

Sat, 11/17/2012 - 15:25 | 2992049 Winston Churchill
Winston Churchill's picture

Mint sauce with my mutton.

Please don't Nuke it.

Sat, 11/17/2012 - 15:32 | 2992063 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Then stay away from the Pacific.

Sat, 11/17/2012 - 15:25 | 2992048 hmmtellmemore
hmmtellmemore's picture

In all honesty, we've been hearing this for years, decades.  Yawn. Can we get a prediction of which year from Mr. Bass when the endgame will finally arrive?

Sat, 11/17/2012 - 15:28 | 2992055 Winston Churchill
Winston Churchill's picture

Go to @shadowstats.Read the annual economic report and find

the answer to that question.

Precis of 150 pages ; End of 2014 if not before.

Sat, 11/17/2012 - 15:48 | 2992087 HungryPorkChop
HungryPorkChop's picture

Here's the video from Shadowstats founder posted on youtube in Oct:

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