This page has been archived and commenting is disabled.

Elliott's Paul Singer Reveals The Thing That Scares Him Most

Tyler Durden's picture




 

When it comes to market experts with decades of insight, we will pick soon to be Second Admiral of his own sovereign navy (comprising of privateered Argentinian schooners, Belize catamarans, and soon, Greek Made in Germany submarines), Elliott's Paul Singer, over those of any fly by night TV talking head, or "information arbitrageur" whose only 'alpha' in the past decade was courtesy of expert networks. The same Paul Singer whose outlook on what the next crisis may look like we posted yesterday.  It is the same Paul Singer, who three weeks ago was a headline speaker at the Archstone Partnerships annual meeting, in which speech he laid out not only the biggest threat facing America - namely the arrogance of the United States "by not realizing that in today's world... you have to be attractive as a country [because] capital will go where it's welcome", but more importantly, the thing that keeps him up at night: "The thing that scares me most is significant inflation, which could destroy our society."

In other words, one of the best and brightest investors in the world, is most terrified by the one thing that every central-planning dispensing economist says will never happen: hyperinflation. Our money is certainly not on the economist theoreticians who could never foresee the second great depression their lunatic policies drove the entire developed world into.

Extracting the key parts from Singer's speech. Highlights ours

Let me make a few comments and observations on the current investment scene. I said before that every once in a while things really are “different this time,” and I thought of a metaphor earlier that might be useful to illustrate an important point. Let’s do a thought experiment: Let’s make believe we are in 1960 and sitting in Germany, and we are a group of German investors and businesspeople, about the same ages as the people here today. The group would be people who had seen the most astonishing changes in the underlying conditions of investing and growing capital—a complete evaporation of savings from 1914 to 1923; complete destruction of society; and a complete change in governance from 1943 until after the War. Keep that image in your mind when you come back to 2012 in New York City today and realize the basic terms and conditions of everybody in this room have not really changed over your entire career. There have been booms and little crashes, you’ve made money and lost money, some people were wiped out and others became wealthy, but the elections come every four years, power is transferred peacefully, and taxes go up or go down.

 

It concerns me that we might be entering a period—we have to think about this possibility—when the basic terms and conditions of owning capital, making a rate of return, and keeping the money you earned might be in the process of changing. Charles Krauthammer said some time ago that most of American political life is between the 40-yard lines and that this crowd, which has been elected for another four years, is kind of at the 30-yard line. I had thought about it at the 10-yard or 5-yard line, but Charles is more mature than I and I’ll accept what he said. But I’m very concerned about class warfare generated from the top, about the possibility of an extended period of lacking strong economic growth. I think economic growth could be easily achieved in the United States at greater levels, and I’m quite concerned that the current prospects, beyond the so-called “fiscal cliff” and a deal on taxes and spending cuts, will be an extended period of low growth and possibly a recession, the continued bashing of money and success and very large tax increases.

 

I want to call to mind a micro choice that I think is relevant. If you lived in the upper Midwest, you’d know the difference between Indiana and Illinois. You would know Indiana welcomes jobs and businesses, and finds ways to work with businesses; and Illinois is on a slide to Hades. Illinois—and I suppose Michigan, too—is doing everything possible to support unsupportable expenses, structures and make thing miserable for taxpayers.

 

By the same token, I think America—and this goes beyond President Obama’s administration—has been quite arrogant for a long time by not realizing that in today’s world, where many countries around the globe can turn out products and services more cheaply than America, and where America has lost so many industries and jobs to other countries, that you have to be attractive as a country. Capital will go where it’s welcome. It is subject to an understandable rule of law, regulation, fair and attractive taxation, and the quality of life. I’m afraid of that, because when you look at the sweep of the booms since the Internet boom and monetary policy, and the extremism that has become embedded in current monetary policy, the United States, Europe, the U.K. and Japan, you do see extreme monetary policy.

 

They say this is not massive money printing, but first they are wrong; and second, monetary authorities in the United States did not see the crash coming and the unsoundness of the financial system. In fact, right up until the crash they were saying that nothing like what happened could ever happen. So money printing and zero-percent interest rates, which have distorted the economic recovery and the landscape in the United States and Europe, have become a substitute for sound, pro-growth, fiscal regulatory tax policy. As a result, they say they are not concerned about inflation. This monetary policy, $3 trillion of bond buying in the United States, $3 trillion in Europe and another $2.5 trillion to $3 trillion in Japan, is unprecedented. It is not the case that they know the ultimate inflationary potential when this low-velocity money gets back into the system and acquires some velocity. If and when people lose confidence in paper money because of repeated bouts of quantitative easing and zero-percent interest rates—it could happen suddenly and in a ferocious manner in the commodity markets, in gold, possibly in real estate—interest rates could go up at the long end by hundreds of basis points in a very short time.

 

I’m quite concerned as a money manager that we have to manage money, not just for the boundaries of what’s in front of our faces—maybe we’ll have a little tax increase or not, the fiscal cliff, or the stock market might go up or down 10% or 15%—but for a basic shift. The thing that scares me most is significant inflation, which could destroy our society. Frankly, in my view the recent election has diminished the probability of a strong resurgence of growth, and I’m quite concerned. Others are concerned about the course of the next 12 to 24 months in terms of growth, taxation, regulation and social unrest, a resurgence or larger version of bashing anyone who has made money or makes money and not paying their fair share.

Or, perhaps, the developments over the past several months were geared with precisely this outcome in mind: because there is nothing quite like "social unrest" to resolve decades of untenable economic and monetary imbalance build up...

 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Mon, 12/10/2012 - 16:47 | 3049654 trav777
trav777's picture

actually, after seeing that all you do in there is spam with nonstop sophomoric profanity, I decided that the risk/reward ratio on a work machine was simply not worth it.  Sorry, expected more out of you than puerile blather.

Mon, 12/10/2012 - 17:12 | 3049746 fuu
fuu's picture

That chat has gone down hill since the irc days.

Mon, 12/10/2012 - 17:16 | 3049763 chumbawamba
chumbawamba's picture

Aw, shut up, you stupid nigger.

Mon, 12/10/2012 - 17:29 | 3049804 chumbawamba
chumbawamba's picture

Surely your boss, Cass Sunstein, is not going to get his panties in a bunch over a few ethnic slurs crossing over the federal government's inside wire?

Mon, 12/10/2012 - 16:49 | 3049658 Hulk
Hulk's picture

He is ChumbaWamba...

Mon, 12/10/2012 - 15:51 | 3049406 chumbawamba
chumbawamba's picture

We need that alcoholic chick from Colorado who was always stoned on wine and exposing her breasteses...what was her name?

-Chumblez.

Mon, 12/10/2012 - 16:15 | 3049517 centerline
centerline's picture

Funny.  I forgot all about her.  Name will come to me later.  She popped up on a few sites I used to visit a couple of years ago.

Mon, 12/10/2012 - 16:22 | 3049545 akak
akak's picture

'Velobabe'

Mon, 12/10/2012 - 20:31 | 3050336 Dave Thomas
Dave Thomas's picture

I'm never on chat when the really good shit happens.

Mon, 12/10/2012 - 16:20 | 3049542 tip e. canoe
tip e. canoe's picture

velobabe

Mon, 12/10/2012 - 16:23 | 3049547 Hulk
Hulk's picture

Velobabe.

Fight club is back Bitchez!!!

 

Mon, 12/10/2012 - 23:24 | 3050835 Umh
Umh's picture

You sound like my ex-brother-in-law "breasteses" ......................

 

 

breast is plural already.

Mon, 12/10/2012 - 16:08 | 3049492 candyman
candyman's picture

Yea the front line is back, should be an interesting game from here.

Mon, 12/10/2012 - 22:50 | 3050704 Xanadu_doo
Xanadu_doo's picture

its an Xmas/Kwanzaa/Chanukah/Festivus miracle!

Bitchez.

Mon, 12/10/2012 - 15:55 | 3049437 Seer
Seer's picture

Welcome back, I think...

I'm only 6 weeks behind you vis a vis "seniority" here, but I've been touting the same message of growth being the problem since I arrived.  180 from you on your xenophobia though...

Mon, 12/10/2012 - 16:19 | 3049533 trav777
trav777's picture

you will yield.  I am not xenophobic...soon as you figure that out, you will be somewhere

Mon, 12/10/2012 - 18:13 | 3049937 akak
akak's picture

So then it would be with benevolence that you would march all the darkies into the gas chambers?

Mon, 12/10/2012 - 15:53 | 3049404 Ruffcut
Ruffcut's picture

Horseshit times a bazillion.

It can only happen if "they" want it to happen. Only if it is an advantage, unless intensely insane, would any one do this or not see it coming.

Alot of us saw this, years ago.  Nothing burger juices of stink.

The greed of the system has made it a global profiteer campaign and fist fucking of middle class amerika.

Mon, 12/10/2012 - 16:02 | 3049464 Seer
Seer's picture

Do you really think that they can make unicorns appear?

Don't you get it that this is the last place the they want to be, juggling exploding grenades?

TPTB ARE TBTB because of their ability to maintain stability.  Don't confuse their function with their ability, especially in light of the fact that they are now up against the physical realities as imposed by physics/mother nature.  Their Golden Goose -growth- has stopped laying.  There is no way out: war will be the distraction (because the servants will be demanding more crumbs), until it is discovered that our "masters" have turned on "us" (not like they've ever been on any side other than their own, but the myth is about to be upended- total game over).

Mon, 12/10/2012 - 17:23 | 3049790 GCT
GCT's picture

SEER they make unicorns appear everyday on TV!  What else does one need!

Mon, 12/10/2012 - 18:06 | 3049919 grid-b-gone
grid-b-gone's picture

+1 TPTB work within the penumbras of the status quo. When the entrenched have lost power in history, it can be argued that they almost always lost control of the status quo.

It makes sense. They need to know which strings to pull behind the scenes to make their desired outcomes come to fruition. It takes time to create and maintain the structure that makes that possible.

Change, especially rapid change, does not leave enough time to make adjustments to the power structure.

We are seeing this in Europe with more stories of wealthy people leaving. Normally, they would have worked behind the scenes using contacts and political influence to effect change. Each new decision to bail indicates the entrenched are no longer confident they have the ability to determine their own destiny in that location.

Mon, 12/10/2012 - 18:23 | 3049959 mumcard
mumcard's picture

I don't think TPTB have lost control at all.  I think this is a normal step in the cycle.  They start the wars and consolidate their power even further each time.  They throw their smoke bomb and abra cadabra *poof* they're gone.  They always reappear though. It's a cycle of shearing and slaughtering the sheep.

Maybe in the next iteration they'll make sure there is no internet and all the historic economic texts will be lost or locked away (to prevent future fight clubs).

Mon, 12/10/2012 - 19:48 | 3050164 Captain Kink
Captain Kink's picture

What if there are no TPTB?  Would that make it scarier?  What if no one is in charge?

I think there are factions with very long horizons that vie for power and "control", but I think not a one of them has any fukking clue as to what is coming.

Dark Ages, Bitchez. But not for some time, I think. Our hyperinflation or currency/debt collapse or whatever other form it takes will just be the beginning.  We are in the very early stages of the slide.  like the first inning was 1973, now it's the top of the 6th. Things will be get really nasty around the seventh inning stretch.

Tue, 12/11/2012 - 01:54 | 3051171 mumcard
mumcard's picture

But anyone paying attention knows that the Rothschilds have been behind almost every major war in the past century.  Their minions were behind the economic collapses as well.  This is a cycle and trust me they have planned for it even if they didn't plan every consequence.  They'll be high and dry watching the chaos unfold, as always.  Then they'll step in and start all over again.

Mon, 12/10/2012 - 16:33 | 3049594 Chupacabra-322
Chupacabra-322's picture

Keynesian economics advocates deficit spending while the school of Milton Friedman/Greenspan advocates money printing.  Historically we're at the highest levels of doing both.  The reality is we're bankrupt and the restructureing is already either in the works or done. 

Mon, 12/10/2012 - 17:34 | 3049831 Silvergood
Silvergood's picture

Its over folks......  Spread the word and get all the physical silver before its too late.  This system is beyond broke.

Mon, 12/10/2012 - 18:33 | 3049987 real
real's picture

i want to kill Santa clause no seriously those dumb fucks ringing their bells and grabbing youngsters possible reasoning

Sat, 12/22/2012 - 11:09 | 3089636 Jafo
Jafo's picture

They knew that the crash was coming.  If not, then why did they have that "closed session" of the congress: you know, the one that had all the congressmen gagged and unable to talk about that which they had been gagged about?

Mon, 12/10/2012 - 15:12 | 3049253 kahunabear
kahunabear's picture

Is he saying we shouldn't trust these guys? That they don't have our best interests at heart? That they have been 100% wrong in the past? Balderdash! Ha.

Mon, 12/10/2012 - 16:03 | 3049470 Seer
Seer's picture

That and he's a genius so we should all hand over our wealth to him to "manage."

Mon, 12/10/2012 - 16:17 | 3049523 SmoothCoolSmoke
SmoothCoolSmoke's picture

Wasn't Bernie Madoff a "genius"?

Mon, 12/10/2012 - 15:10 | 3049254 sbenard
sbenard's picture

I couldn't have said it better

Mon, 12/10/2012 - 15:11 | 3049257 Winston Churchill
Winston Churchill's picture

The herd is getting restless.

One Pop, and there goes the stampede.

Mon, 12/10/2012 - 16:06 | 3049485 Strider52
Strider52's picture

Or one badly-timed battery-operated coffee-grinder in the middle of a cowherd.

Mon, 12/10/2012 - 15:13 | 3049264 semperfi
semperfi's picture

"The thing that scares me most is significant inflation, which could destroy our society."

You fear cuz you don't own enough gold & silver.  Go shopping man. 

Mon, 12/10/2012 - 15:32 | 3049333 Proofreder
Proofreder's picture

There will be significant "social unrest" just as soon as price inflation overcomes the EBT card allotment of $135 or so monthly per mouth. Presently there is a lot of slack in the system allowing many cards entry into the growing black market, but as real hunger grows, desperate folk responsible for feeding their children will stop at nothing to obtain food. Only hunger-driven social unrest will manifest as roving gangs or chanting crowds. Mob rule soon come following the first hunger riot. Wonder which city will be first. Or twenty-first?

Mon, 12/10/2012 - 15:42 | 3049357 trav777
trav777's picture

your imagination is overactive

Mon, 12/10/2012 - 15:50 | 3049401 tickhound
tickhound's picture

DUUUUUUDE... Welcome back, dickhead. ;)

Mon, 12/10/2012 - 16:13 | 3049511 ali-ali-al-qomfri
ali-ali-al-qomfri's picture

Kinda got into the Walking Dead series as it is foreshadowing of the growing zombie hoard looking for food, (ZH being a radio broadcast warning of the carnage) so I’ll say Atlanta goes down first, no disrespect to Atlantas

Tue, 12/11/2012 - 01:59 | 3051179 mumcard
mumcard's picture

I think it'll be someplace there are browns and blacks, like LA. 

Mon, 12/10/2012 - 17:26 | 3049797 GCT
GCT's picture

You forget Proof they can increase those digital dollars in a keystroke.  Those not on EBT may be the ones that riot.

Tue, 12/11/2012 - 02:00 | 3051176 mumcard
mumcard's picture

Self reliant types will buckle down and try to bear it like they always do.  It's too bad there is no community left among these folks.  And if hyperinflation hits and a loaf of bread costs a million fiat dollars that ebt card will be worthless anyhow.

Mon, 12/10/2012 - 15:37 | 3049342 Renewable Life
Renewable Life's picture

The Amazing part ISN'T that their is going to be massive inflation, it's the fucking balls and arrogance of these bastards at the Fed, thinking they are going to "manage" this shit!!!!!

It's just completely maniacal at this point!! I mean, in what fucking world do you think 9 trillion in printing over a 6 year period, is going to have manageable consequences!!! It's suicidal at best and sociopathic at worst!!

This author nailed it!! Who gives a shit about taxes or the stock market, if gas is at $15 a gallon and bread at $10 a loaf, it's going to be open warfare in the streets of America, Syria style!!! Only 2-3% of the American population is hedged with PM's, land, or commodities to offset the kind of hyperinflation that could be coming!!! Which BTW will rapidly infect rents, food prices, and energy like the plague!!! This shit might make the "tulips" and the Weinmer Republic look like child's play!!!

Bernanke things when the avalanche of money they have printed all over the planet comes off the sidelines, he's going to raise interest rates fast enough??? It's just mind bending???? WTF do they think they will do, raise interest rates to 7% overnight to stem the flood on the liquidity side, and decimate the bond market???? You lower interest rates slowly, you raise them fast! If they don't, the avalanche will bury them with hyperinflation before they can even make their next move!!!

It's gonna be epic on the proportions of Rome!

Mon, 12/10/2012 - 15:49 | 3049395 trav777
trav777's picture

I NO RITE?

It's not as if there have been multiple hyperinflations or outright currency collapses in the past century, or even few decades that we can study for evidence on how societies deal with them.

Mon, 12/10/2012 - 16:14 | 3049514 Seer
Seer's picture

"This shit might make the "tulips" and the Weinmer Republic look like child's play!!!"

Might?

It's all of the worst rolled in to one.  That is, "worst" if one idolizes the bad premise that is perpetual growth on a finite planet.

We're not going to be able to maintain the existing infrastructure let alone grow it (and or any "alternate" BIG replacement).

The consolation will be that the New World Order will be canceled: TPTB may want it, but without the ability to extract more and more physical resources it ain't going to happen.  Now it'll be up to "us" to figure out how life is to work...

Mon, 12/10/2012 - 15:16 | 3049276 Iam Yue2
Iam Yue2's picture

Actually Commerzbank have been banging on about inflation in the Eurozone for the past six months, per, from this recent report which
concluded that it does not matter who wins in Italy, because nobody is going to be able to restore competitiveness;

"the course is therefore set for the euro zone to shift towards an “Italian Monetary Union“: not all peripheral countries are likely to be able to restore their competitiveness through reform, which is why they are still reliant on an expansionary monetary policy from the ECB. The Monetary Union will be characterised by a depreciating currency and higher inflation rates, showing parallels to Italy in the 1970s and 1980s."

Mon, 12/10/2012 - 15:16 | 3049277 bobthehorse
bobthehorse's picture

The system will eventually crash.

But war is on the way.

My advice?  Become a hobo.

That's what I'm going to do.

I plan to live in a school bus and eat chili.

Peace.

Mon, 12/10/2012 - 15:40 | 3049350 Proofreder
Proofreder's picture

Did that in the '60's A great adventure, don't think it would work today. Perhaps with a couple of Pom-Poms mounted roof side.
Or good paint.
Pax

Mon, 12/10/2012 - 15:56 | 3049433 trav777
trav777's picture

abandoned storage containers are in a buyer's market

Mon, 12/10/2012 - 15:17 | 3049278 Jason T
Jason T's picture

pays to read history. thing is, stocks would go up too... especially if bonds collapse.

Mon, 12/10/2012 - 15:44 | 3049368 Proofreder
Proofreder's picture

And so you sell some shares to cover an expense, only to discover
the cost of the item rose before you received the proceeds of the sale.
And the stock rose also. Now what to do???

Mon, 12/10/2012 - 15:52 | 3049420 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

This first stage of the inflationary process may last for many years. While it lasts, the prices of many goods and services are not yet adjusted to the altered money relation. There are still people in the country who have not yet become aware of the fact that they are confronted with a price revolution which will finally result in a considerable rise of all prices, although the extent of this rise will not be the same in the various commodities and services. These people still believe that prices one day will drop. Waiting for this day, they restrict their purchases and concomitantly increase their cash holdings. As long as such ideas are still held by public opinion, it is not yet too late for the government to abandon its inflationary policy.

But then, finally, the masses wake up. They become suddenly aware of the fact that inflation is a deliberate policy and will go on endlessly. A breakdown occurs. The crack-up boom appears. Everybody is anxious to swap his money against ‘real’ goods, no matter whether he needs them or not, no matter how much money he has to pay for them. Within a very short time, within a few weeks or even days, the things which were used as money are no longer used as media of exchange. They become scrap paper. Nobody wants to give away anything against them.

It was this that happened with the Continental currency in America in 1781, with the French mandats territoriaux in 1796, and with the German mark in 1923. It will happen again whenever the same conditions appear. If a thing has to be used as a medium of exchange, public opinion must not believe that the quantity of this thing will increase beyond all bounds. Inflation is a policy that cannot last.

 

The Crack up Boom

Mon, 12/10/2012 - 16:30 | 3049574 Seer
Seer's picture

Care to wager about prices not dropping?

My favorite word: Depends.

Food, Shelter and Water.  Things associated with these fundamentals WILL become more costly (higher valuation).  But... there will be a LOT of shit that will adjust downward because it's not even close to having value relative to the TRUE fundamentals.

Mon, 12/10/2012 - 17:30 | 3049811 centerline
centerline's picture

For awhile, people who are missing the point and have yet to be squeezed hard enough (and quick enough) will grab at some of the cheap items.  System chugs along a little further as a result.

The whole thing is deflationary.  And most people really don't have any free cash.

So far, the Fed really hasn't taken any direct actions in terms of increasing money velocity.  It has mostly so far been a counterbalancing act against the collapsing shadow banking sector.  Something has to "give" for the cash to hit the street.  So far, I haven't seen anything of this nature.

Mon, 12/10/2012 - 15:16 | 3049279 PUD
PUD's picture

The destruction of society is inevitable in a debt=money system, a constant exponential "growth" system and a system completely dependent upon exponential consumption. The end. This is all you need to ever know. That and the fact that in a crumbling society gold will be worthless.

Mon, 12/10/2012 - 15:46 | 3049378 Gamma735
Gamma735's picture

Bullets and Firearms will be worth more than their wieght in Gold.  He who has the firepower gets the gold.

Mon, 12/10/2012 - 20:03 | 3050250 Dr. Sandi
Dr. Sandi's picture

Until the rightful owner blows his head off. Home field advantage.

Mon, 12/10/2012 - 15:47 | 3049384 Proofreder
Proofreder's picture

Gold is never worthless. If it is to you, I'll be pleased to pay it's way to me. Thank you.

Mon, 12/10/2012 - 15:56 | 3049439 Renewable Life
Renewable Life's picture

Well "worthless" might be a stretch!! But what I think you mean is NOT $2000 an oz!! But before we get to $150 an oz gold again, (post collapse) we will see gold explode in waves never seen before on this planet, and I mean like to between $5000-$12,000 an oz with $1000-$3000 swings along the way, as panic spreads and hyperinflation grabs us!! It won't be tulips this time, it will be PM's and Ag land and finally even real estate again before the west finally collapses under its own weight!!

But I agree with you, if your lucky enough to be buying PM's, I hope you'll be smart enough to cash out before the top and be buying Ag land, ammo, food, fuel, generators, solar panels, etc with the cash!!

Mon, 12/10/2012 - 16:13 | 3049513 SmoothCoolSmoke
SmoothCoolSmoke's picture

At 5-12K per oz, gold will become "illegal" to own.  That, you can count on.

Mon, 12/10/2012 - 20:20 | 3050305 Hacked Economy
Hacked Economy's picture

You're probably correct, although it might not be such a bad thing, depending upon the circumstances and your view of gold (asset, investment, heirloom, etc.).  If we do move to a gold-backed currency and the .gov wants what you have to replenish its coffers, it'll likely be after the mania phase (parabolic price increase) of gold, at which point you'd want to sell anyway if a profit is your goal.  If gold is officially re-valued at, say, $10K per ounce to properly support the new currency, then even if the public is required to "redeem" their physical holdings, then you've likely made a healthy profit in relation to what you originally paid for it.  At the end of the day, you can't eat your gold, remember?  Its eventual value is in its ability to PRESERVE your wealth, which in turn is necessary to buy your other physical necessities such as food, clothing, etc.

Silver will likely never be confiscated, so keep some of that in your portfolio too for the event of a temporary total collapse where coins might be used for a while.  Pre-1965 junk silver is the best because it's already a Constitutional U.S. currency.  :)

Mon, 12/10/2012 - 16:46 | 3049645 Seer
Seer's picture

You've got a more level-headed view I'm thinking...

Time moves on, which means nothing can stay static.  A "collapse" will occur in different places at different times, and at differing levels of impact.

Stores of "wealth" are just that, stores.  They do little in and of themselves, and do nothing if they just sit there and are never put to "work" (issues of inheritance aside).

All that we're starting to see is a process of the revaluation of goods and services.  For the astute it should be quite clear that one doesn't take the cue of the existing "trade," the one that built up this bubble and is predicated on infinite growth (unicorns and skittles promised to all).

"it will be PM's and Ag land and finally even real estate again before the west finally collapses under its own weight!!"

I don't think there's enough traction left for any of these to experience any (re)bubbling.  No argument that TPTB will try and pump things up, that's their job- they're cheerleaders who want us to work harder and harder, FOR Them.

Mon, 12/10/2012 - 20:36 | 3050329 Hacked Economy
Hacked Economy's picture

"A "collapse" will occur in different places at different times, and at differing levels of impact."

-------------------------------------------------
Very good.  I don't recall anyone else here touching on that likelihood, but it's true.  At least, on a macro/global scale.

-------------------------------------------------
"Stores of "wealth" are just that, stores.  They do little in and of themselves, and do nothing if they just sit there and are never put to "work" (issues of inheritance aside)."

-------------------------------------------------
Also very true.  See my earlier response to @Smoothcoolsmoke above.

Tue, 12/11/2012 - 02:07 | 3051186 mumcard
mumcard's picture

So are you going to sell your gold for 20k fiat dollars when we're in total economic collaspe?  Then really people are holding on for the restabilization after the collapse at $150 an oz.  Store of wealth, not an investment.

Mon, 12/10/2012 - 15:56 | 3049443 trav777
trav777's picture

right, because in every crumbling society in the past 100 years, gold has been worthless.

What will be worthful, then?  Lemme guess, guns and ammo?  We will all shoot our way to happiness, right?

Mon, 12/10/2012 - 16:50 | 3049665 Seer
Seer's picture

Food, Shelter and Water.  More-so than at any time in the past oil-bubble years.

Speaking of oil-bubble, oil's value (I won't play with "cost" numbers, as it's about affordability) will increase.  Work is power, and power is work...  NOTE: PMs and ammo store a LOT better than oil :-()

Mon, 12/10/2012 - 17:33 | 3049820 GCT
GCT's picture

Welcome back Trav.  Seer is correct and I love the shiny metal.  But all bullshit aside if you have stacked gold and the real shit hit the fan, food and water will determine the trade.  Starving gold horders will gladly trade whatever is needed to feed them.

Especially it said resources are well defended.

Yes I do like my gold.

Mon, 12/10/2012 - 20:44 | 3050375 Hacked Economy
Hacked Economy's picture

I can't seem to locate it again (to provide a link for y'all), but I remember reading a story (complete with photos) of Hurricane Sandy survivors who were so ecstatic about receiving a roll of toilet paper (one roll each person) from emergency relief crews, that they were posing with them for pictures - with big grins on their faces.

Food, clean water, dry socks, and toilet paper.  PMs are further down the list, after these items.

Mon, 12/10/2012 - 17:33 | 3049821 LawsofPhysics
LawsofPhysics's picture

real productive capacity.  Get your fucking tribe in order, bitchez.  glad you are back trav.

Mon, 12/10/2012 - 18:12 | 3049934 trav777
trav777's picture

bzzzzt.

Warlords and charisma.

Mon, 12/10/2012 - 20:07 | 3050271 Captain Kink
Captain Kink's picture

so you're SOL?

Mon, 12/10/2012 - 17:35 | 3049830 centerline
centerline's picture

Anyone buying gold thinking that what is coming might be short lived and they come out the other side to live like a rock star as a result (I'm rich, bitch!) might be disappointed.

It might however serve as passage from somewhere downright dangerous to somewhere a little more safe.  Maybe save a life.  Maybe make it to the other side and give someone younger that us (kids) a leg up in whatever new system arises from the ashes of this one.

Is a form insurance, IMO.  And all eggs in one basket is probably a really big mistake.

Mon, 12/10/2012 - 15:18 | 3049281 Nu Yawks hottes...
Nu Yawks hottest club is's picture

The thing that scares him most seems to be his billions leaving him for another 'investor'. So, the same as every other rich douche then.

Boo-hoo.

Mon, 12/10/2012 - 16:52 | 3049679 Seer
Seer's picture

You mustn't ridicule the rich!  People desire to be one, and if you don't support Them then you don't support Capitalism, and we all know what happens if you don't support Capitalism (even though people will both argue that it should be saved as well as it hasn't existed- hard to reconcile...).

Mon, 12/10/2012 - 17:35 | 3049834 centerline
centerline's picture

Got the keep the hamsters on the wheel now!

Mon, 12/10/2012 - 15:18 | 3049284 FranSix
FranSix's picture

TIPS yields are bound to go negative across the entire yield curve first, and second, this would drive down short term treasury rates to nominal negative.

Higher interim rates at the long end of the curve will not necessarily affect gold prices, since gold prices can go into backwardation on negative nominal treasury bill rates, and gold prices aggressively advance into a lasting mania phase.

One thing that might occur is that the gold price is fixed in foreign exchange terms, possibly around $2000/oz.  This would mean a devaluation is set to occur some time later.  That means that you'll wake up one morning and the money you make or receive in pensions or yields will have half the purchasing power it did the night before.

If this is not done, then you can sort of expect that the onset full on monetary crisis of collapsing fiat currencies is an inevitability.

Mon, 12/10/2012 - 15:56 | 3049430 stewie
stewie's picture

I never understood how devaluation by fixing the price of gold works in a fiat system.  

1- How do you fix the price of Gold? The price is determine largely by supply/demand!

2- Since there's no convertiblity to gold, why would "fixing" it higher affect the purchasing power of currencies?

Anybody cares to enlighten?

Thanks

 

Mon, 12/10/2012 - 18:07 | 3049922 LawsofPhysics
LawsofPhysics's picture

There already are paper markets and physical markets.  Such is the way with collapses and losses of CONfidence.

I reamain long black markets and anything of physical value that the paper-pushers cannot devalue.  America is heading where the Soviet Union went, just coming at it from a different direction, hedge accordingly.

Mon, 12/10/2012 - 15:20 | 3049293 venturen
venturen's picture

Wasn't Greenspan captain with first mate Geithner the crew of the Titanic? 

Mon, 12/10/2012 - 15:23 | 3049303 americanspirit
americanspirit's picture

Actually that was the Good Ship Lollypop

Mon, 12/10/2012 - 16:57 | 3049698 Seer
Seer's picture

Great!  You've now ruined it (song) for me!

Mon, 12/10/2012 - 15:24 | 3049305 davidsmith
davidsmith's picture

 If and when people lose confidence in paper money because of repeated bouts of quantitative easing and zero-percent interest rates—it could happen suddenly and in a ferocious manner in the commodity markets, in gold, possibly in real estate—interest rates could go up at the long end by hundreds of basis points in a very short time. I’m quite concerned as a money manager that we have to manage money, not just for the boundaries of what’s in front of our faces—maybe we’ll have a little tax increase or not, the fiscal cliff, or the stock market might go up or down 10% or 15%—but for a basic shift. The thing that scares me most is significant inflation, which could destroy our society."

 

 

These comments are simply wrong in the context of the U.S. economy, which is a corporatist-ogopolistic economy.  All the issues which worry him as a bourgeois, are exactly the things which are being managed by the corporatist economy.

 

He has a knowledge gap. He simply hasn't studied quasi-fascist economies.  The U.S. is in a process of social deterioration.  Power is concentrating in response to it.  That's all.  Every tool in the toolkit will be used to ward off inflation or deflation, full employment or grave unemployment.  Every time a tent peg comes up, the corporatist economy will attempt to ward it off.

 

Why?  So as to keep the system going long enough to loot it COMPLETELY.  In the end, once you have looted everything you can loot, you toss the whole mess to the military.

 

But that's some years away in the U.S.  It happens when there's a 50% underemployment rate.  We are half that now.  If the writer wants to do something useful, he will provide us with an estimate as to when the U.S. will reach 50% underemployment.  That's when these quasi-fascist tactics will fail.

Mon, 12/10/2012 - 17:07 | 3049729 Seer
Seer's picture

We could call "IT" all sorts of things, quasi this, quasi that, but the ONE thing that is certain is that it's ALL based on growth.  Those at the "helm" may or may not understand the failings of the premise because, as usually the case for perpetuating things, you jump past it and get on with dealing/managing/controlling.

I wouldn't think it prudent to ask for timing because if you have to concentrate on that they you aren't busy preparing for the future... One would always question whomever the oracle was anyways (and, I suspect, that the oracle wouldn't be on "the team," in which case TPTB would do all sorts of things to discredit- paint the numbers all kinds of different ways, not just the REAL color, not even when it it obvious to all- denial is what they are expert in).

Mon, 12/10/2012 - 15:25 | 3049306 rustymason
rustymason's picture

"The thing that scares me most is significant inflation, which could destroy our society."

Too late, society has already been destroyed.

Mon, 12/10/2012 - 15:26 | 3049313 Madcow
Madcow's picture

1. Deflationary Depression

2. Austerity

3. Tax Increases

4. ???

=

5. Growth !!

Mon, 12/10/2012 - 15:50 | 3049402 Proofreder
Proofreder's picture

4. War

There, fixed it for ya.

Mon, 12/10/2012 - 15:29 | 3049322 Super Broccoli
Super Broccoli's picture

I think his statement is true. Money printing will result - at some point depending on velocity and how soon that money hits the peasants hands somehow - in hyperinflation that will lead to revolutions.

The only question being : when is that going to happen ? Well i believe we still have a few months before it does so get back to work everyone this ain't the end yet ! (it still need to get a whole lot worst before it does)

Mon, 12/10/2012 - 15:52 | 3049419 trav777
trav777's picture

that's only if they print it.  They're not.  They're buying debt...kind of the same, but not really as the debt they buy has some repayment attached to it.  They are still trying to grow the credit system.

An inflationary outburst like in the 70s, where lending and prices went nuts, they believe they can squelch quickly with what would be a massive raise in rates.  Rates are like the control rods in Chernobyl.  Right now, they've pulled them all out, hoping that the lending machine will restart.

Mon, 12/10/2012 - 16:03 | 3049466 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Trav you know nothing about monetary policy obviously.

Mon, 12/10/2012 - 16:04 | 3049480 trav777
trav777's picture

In fact, Mr. Hendrix, I know everything.

What I have said is true.  Ever wonder why you AREN'T seeing runaway hyperinflation?  Might wanna stfu and listen for a change.

Mon, 12/10/2012 - 16:16 | 3049522 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Your comment was that the banks are not printing, but they are.  Not soley, but they are.  The $45B to buy MBS is being constructed out of thin air.  The UST purchases from OT2 are coming from selling the short term USTs, sure, but the $45B for MBS is being printed.

Your theory has to do with credit, but there always has to be a funding mechinism.  The only current one is coming from the Central Banks and they are not collecting enough revenue to make the purchases without creating fiat.

Mon, 12/10/2012 - 16:40 | 3049625 stewie
stewie's picture

Yes the Fed is expanding it's balance sheet, but the new money created barely offsets the deleveraging in the shadow banking system.  That's why there's no hyperinflation, from what I understand anyways.

Mon, 12/10/2012 - 16:48 | 3049656 Yen Cross
Yen Cross's picture

Have you been to the" Grocery Store" lately?  Oh wait, Stewie is still on the teet....

Mon, 12/10/2012 - 17:23 | 3049793 Seer
Seer's picture

HYPERINFLATION.

If we really had it we'd see smoke all about us.

TPTB's strategy isn't one of stuffing the hammer down on things.

As noted (I think it was, but if not I state it anyway), inflation by Austrian economics measurement is about the increase in the amount of money circulating.

Price inflation is the result of high demand.  Usually it occurs with an expansionary environment.  This is not the case today (which is why people are so confused).  What's happening today is that physical inputs are becoming more costly because of scarcity; even though there's contraction happening!

You can't find this stuff in any text book on economics because the entire profession has never accounted for the scenario we're in: growth being impossible (using the existing, MASSIVE, highly efficient/productive infrastructure).

Say what you will, but the Fed is doing the ONLY thing they can do to ease us from the ledge.  If you view the funny numbers as just that -funny numbers- then you realize that that's how they're going to play it.  It's up to "us" to understand the real value in things: and, sadly, based on the fact that people can't grasp the exponential function I'm not thinking we'll find our way with anything remotely resembling clarity).

Mon, 12/10/2012 - 19:07 | 3050061 Future Jim
Future Jim's picture

Innovation has always grown faster than population.

Maybe growth today is being limited by taxes, regulation, cronyism, and missallocation of capital - all by government.

Maybe this is all intentional.

Mon, 12/10/2012 - 20:55 | 3050411 Hacked Economy
Hacked Economy's picture

Once again, class...

HYPERINFLATION is a result of a lack of confidence in a currency.  It has similar aspects to inflation to the observer, but at its core is a different animal altogether.  It can occur (spark) at any time, for a variety of reasons.  Just because you don't see the smoke yet, doesn't mean the heat isn't already present.  350 degrees, and the paper hasn't ignited yet, even though it's hot and in a vulnerable state.  But keep turning up the heat, and when you reach 451...

Mon, 12/10/2012 - 21:10 | 3050448 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

You are over simplifying it.  When you flood the world with dollars, when the supply increases, then the price of the dollar will fall.  Take away demand and the price falls further.  Even if everyone went on believing that the dollar was a functioning currency other assets priced in dollars would continue to rise.  Let's say people are as dumb as they appear and prices rose and rose and rose.  Sure people could be wiping their asses with their hands because they couldn't aford toilet paper, but you would have me believe that if TP cost $100 a role there would be no hyperinflation because people were still walking around not speaking of the price increase?

Sorry buddy, but hyperinflation doesn't have to be sudden.  In fact if you want to analyze the purchase value of the dollar, I would say considering it has lost more than 9/10s of its value we could already put that in the hyperinflation catagory.

Tue, 12/11/2012 - 22:55 | 3054473 Hacked Economy
Hacked Economy's picture

No, gotta disagree with you there.  Your example shows strong inflation, but if extended over a lengthy period of time, then it isn't a total public loss of confidence in the currency, and not hyperinflation.  One can lead into another, but they are different.  By your definition, the 98+% loss of purchasing power of the U.S. Dollar constitutes hyperinflation...except that we're talking about a timespan of a full century, so it is NOT hyperinflation.

BTW...I've got my TP needs covered for a long ways out.  :)

Mon, 12/10/2012 - 16:53 | 3049685 trav777
trav777's picture

And who OWNS THOSE MBSs?

What IS an MBS?  Hint doofus: it's a DEBT.

When the money payment from the MBS comes IN, the Fed EXTINGUISHES the monies from the purchase!

It's a big circlejerk.  They have to do this to offset credit collapse in the rest of the system.  There is NO source of credit demand...the freakin interest rates should TELL YOU THIS.

Rates are set by the MARKET.

Mon, 12/10/2012 - 17:09 | 3049738 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

I thought you were leaving to go make rubles?

And as for the market setting rates that would mean the market thinks there is no inflation, since rates are near zero, yet oil and precious metals have been pushing their highs over the last few years which would show that inflation is gaining traction.

Also Bernanke and the Fed have said they will "keep rates low" so you will have to argue with them that they do not set rates because they think they do.

Mon, 12/10/2012 - 17:48 | 3049872 Seer
Seer's picture

That could be turned around- if the market thought that there WAS inflation then wouldn't it be producing MORE?

We have a MAJOR change in our values going on.  People are realizing that most of the TARGET stuff, like HUGE homes and HUGE vehicles and HUGE TVs, can no longer be afforded.  The draw-back on these things is capital/money flowing into other things, things that, we'd hope, are more closely based in reality/sanity.  Metals are being seen as more valuable than fiat: yeah, it's taken a while for people to realize this (to stop playing Russian Roulette, playing with fiat money).  Oil is "higher" because it has been woefully under-priced vis a vis its scarcity: the problem has been that it's SO important that allowing it to jump to a measure more closely approximating this would hammer the shit out of everything else- a sure way to just throw the breaker and say good night.  It has ALL been about slowly correcting the price of this all-important resource, push up, have the engine stumble, some tweaks made (jobs cut- people forced to figure out that they're going to have to fend for themselves outside of a corporate structure), throttle up the price a bit more, more stumble, more tweaks...  I don't, however, see any pull back, as the reversal of economies of scale will shut down the factories for MANY things, permanently: where are people going to find wealth to pay off their debts AND put toward the purchase of non-essentials (again)?

Mon, 12/10/2012 - 18:16 | 3049952 trav777
trav777's picture

This is why you don't know anything, and you should have followed my previous advice.

DEMAND and SUPPLY set ALL PRICES of EVERYTHING.  Read that again, stupid.

Yes, even credit.  Inflation or perceived inflation DO NOT SET the prevailing interest rate; they merely affect DEMAND AND SUPPLY.

The market doesn't "think" anything...there is NO demand for credit.  You can see this all across the economy.

Oil isn't high because of inflation or rates or any of this; it's high because we're running freaking AT production capacity.  Gold production peaked 10 years ago.

The Fed can OBVIOUSLY set ITS price for credit.  But it CANNOT make people borrow.  Anymore than a THEATER can dictate the price of movies by raising its prices...if there is no demand for the ticket, there isn't going to be more revenue from raising prices.

The Fed has lowered the cost of credit hoping that people will use more of it at this price point.  THAT is how interest rates work.  They are merely a COST of credit.

Mon, 12/10/2012 - 21:05 | 3050423 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Incestuous demand for bonds from the Fed does not actualize real demand, it just hides the paper after paper has been printed (digitally or really).  So in your absurd supply/demand arguement obviously demand has dropped for bonds while the supply of paper has increased.  This means the value of the underlying collateral, the dollar, has dropped, and a dropping price in the dollar raises all assets, which causes inflation.

Mon, 12/10/2012 - 16:34 | 3049602 orangedrinkandchips
orangedrinkandchips's picture

Massive is the key word...a rise in rates means jack since they are so manipulatingly low....I would love to see it in my lifetime....but doubt it

 

why pick up an "economics" book when all bets are off now that the fed controls everything....

Mon, 12/10/2012 - 16:34 | 3049604 orangedrinkandchips
orangedrinkandchips's picture

Massive is the key word...a rise in rates means jack since they are so manipulatingly low....I would love to see it in my lifetime....but doubt it

 

why pick up an "economics" book when all bets are off now that the fed controls everything....

Mon, 12/10/2012 - 18:02 | 3049907 Seer
Seer's picture

As a Realist I'm NOT going to pick up an "economics" book.  But all these commentators base their discussions (and lives) on their "knowledge" of economics: and generally it's one of two main "camps" (both, however, that I see major flaws with).

The Fed "controls" a crashing airplane.  Do YOU want to take over those controls?  They'll end up with what they have- a bunch of shit.  Why would they feel all giddy with this?  MANY a corporate rat (and economist) has jumped ship.  Meanwhile folks like Bernanke stay on... at some point one has to either admire his capacity to endure with a low IQ, or admire his capacity to endure as a captain going down with the ship.  If the airplane really is out of fuel and is heading for a crash (no glider plain this is) then it is what it is- futile; BUT, pretending as though They have any ability to defy gravity is just a back-door way of hoping that the impossible happens.

I tend to look at it as buying time.  Based on the fact that the majority of arm-chair quarterbacks, the self-prescribed "intelligent" people, don't comprehend something as simple as the exponential function I'm not thinking that having crashed earlier would haver made ANY difference (time MIGHT allow people to acquire more understanding).

Mon, 12/10/2012 - 15:31 | 3049328 slaughterer
slaughterer's picture

OT: short squeeze du jour: MCP.

Yes, the "rare earths" craze is back. 

33million short float.  

Waiting for the VW moment.  

Mon, 12/10/2012 - 15:32 | 3049331 chrisd
chrisd's picture

Keep hitting on hyperinflation Tyler, maybe you can make some more through Gold ads backed by theblaze.com. Anyone quoting Charles Krauthammer needs to be put down.

 

When there is a credible alternative to the USD in petro exchanges, I might make some side bets, until then you are both full of it.

Mon, 12/10/2012 - 15:41 | 3049355 Yen Cross
Yen Cross's picture

xau has a massive support level  just under 1700/

Mon, 12/10/2012 - 15:50 | 3049397 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

Also very strong support at "$522"!  Check the charts!

 

Tuco

Mon, 12/10/2012 - 16:09 | 3049499 Yen Cross
Yen Cross's picture

The Armageddon trade/ Scorched Earth trading... I like it ;-)

Mon, 12/10/2012 - 15:48 | 3049385 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

The dollar is dead internationaly.  China, Russia, Japan, India, Brasil, they are using their own currencies to trade now.  You have been left in the dust.  Good luck chrisd.

Mon, 12/10/2012 - 16:08 | 3049490 trav777
trav777's picture

no, they aren't.  They are using some relatively trivial volumes compared to their USD reserves exposure, nevermind petrodollars.

The USD is 75% of world debt...wtf does it matter if Brazil and China arrange to use CNY/BRL (one of which is PEGGED TO THE DOLLAR) in modest amounts in bilaterial trade when the very MONEY they owe all across their economies is denominated in DOLLARS?

Dead?  Do you pay any attention to the POG in BRL or the USDBRL pair lately buddy?  I almost had to change my luxury vacation plans to head back to brazil bc the BRL has blown out to 2.1 per.  Dead?  LOL.

Mon, 12/10/2012 - 16:20 | 3049539 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

China abandened the strict dollar peg a year ago. 

And I wasn't pointing to FX pairs, I was pointing to the fact that these Nation-States are no longer using dollars as their defacto trading currency.

Mon, 12/10/2012 - 16:25 | 3049554 Yen Cross
Yen Cross's picture

PBoC widened the "trading band" earlier this year/ It's generally around 2%...

Mon, 12/10/2012 - 16:56 | 3049695 trav777
trav777's picture

Excuse me, but did I not already ADDRESS THAT?!?!

I said it DOESN'T MATTER, these pitifully little bilaterial trading measures!

I told you that 75% of world debt, plus a higher percentage in emerging economies, which is sprayed ALL OVER brazil and China, are dollar-denominated.

And I told you to check the fkin BRL cross if you thought that this move by Brazil (who is desperately trying to CHEAPEN their currency against the USD as we speak) meant that the dollar was dead.

I guess, to sum up what I am getting at is: STFU moron, you are wrong.

Mon, 12/10/2012 - 17:14 | 3049753 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

My point is that many other States have decided to trade outside of the dollar for the first time since the dollar became the reserve currency.  I didn't say that the dollar would be dumped overnight, in fact, I have said the oppostie would happen.  Nobody wants to be seen at fault for causing a panic while they heard the sheep to slaughter.

Yet the dollar will be slowly abandoned for the next couple of years.

Mon, 12/10/2012 - 21:56 | 3050544 Urban Redneck
Urban Redneck's picture

Who cares about CNY/BRL when there's CNY/RUB which is being to pump non-petro dollar settled oil through the ESPO pipeline and could spread to the Yakutia–Khabarovsk–Vladivostok, Sakhalin–Khabarovsk–Vladivostok, Turkmenistan–China, 
and Kazakhstan–China pipelines?

 

Mon, 12/10/2012 - 18:09 | 3049924 Seer
Seer's picture

Could you provide an instance in which a fiat currency that has flirted with hyperinflation managed to escape it.

Also, if you could find an instance of a fiat currency that was also the world's reserve currency, That would really be appreciated!

Hyperinflation means the total (near total?) loss of confidence in a currency.  Lost confidence in government... check!  Lost confidence in the Fed... check!  Lost confidence in corporations (which help circulate the currency)... check.  The tide doesn't appear to be coming in...

Mon, 12/10/2012 - 15:33 | 3049332 ekm
ekm's picture

I was the first one to use the word "theoretician" and still use it over and over and over. Thx for the recognition.

Mon, 12/10/2012 - 15:40 | 3049352 akak
akak's picture

And I invented the question mark.

Mon, 12/10/2012 - 15:47 | 3049382 Yen Cross
Yen Cross's picture

I invented the interNet/ and Algorithms/

Mon, 12/10/2012 - 15:33 | 3049334 smart girl
smart girl's picture

Stop the War in Syria! Interview with Assad http://www.youtube.com/watch?v=pdH4JKjVRyA

 

Mon, 12/10/2012 - 15:44 | 3049369 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

I was debating Syria with someone who believes the MSM yesterday.  The conviction was that Assad has chemical weapons.  What is the truth to this?  WHat evidence is there to prove it and what evidence is their to the contrary?

Mon, 12/10/2012 - 16:01 | 3049459 pods
pods's picture

Well the West does not have to prove he has them, he has to prove he got rid of them.

And he has to do that to the Western Media.

And try to do it while the West tries to remove him.

pods

Mon, 12/10/2012 - 17:06 | 3049728 hoos bin pharteen
hoos bin pharteen's picture

Here is a good open source item from 2007.

 

http://www.newenglishreview.org/Jerry_Gordon/Syria%27s_Bio-Warfare_Threa...

 

 

Mon, 12/10/2012 - 17:36 | 3049837 NotApplicable
NotApplicable's picture

Likely the same evidence they had on Saddam, the "Made in the USA" sales receipts.

Mon, 12/10/2012 - 17:37 | 3049838 NotApplicable
NotApplicable's picture

seems I'm twitchy today

Mon, 12/10/2012 - 15:42 | 3049359 A Lunatic
A Lunatic's picture

Society in it's present configuration needs to be destroyed. It is only the weak, stupid, and those hooked on Hopium that will fall by the wayside anyhow, so bring it the fuck on, bitchez..............

Mon, 12/10/2012 - 18:13 | 3049940 Seer
Seer's picture

I won't pass judgment, but... it WILL happen- anything that cannot continue forever won't.  Nothing even remotely resembling sustainability in society.

I'm not counting on more time, but I'll take whatever time I can...

Mon, 12/10/2012 - 15:45 | 3049370 max2205
max2205's picture

Stfu up scardy cat.

Mon, 12/10/2012 - 15:46 | 3049374 MsCreant
MsCreant's picture

People have to understand what is going on to get pissed. First you have to get their attention. Then they need a target for their anger. They may not have the ability to understand what the target should be. I teach at a state university. I am stunned and floored by how unprepared these students are. I could say more but that is another topic. Inflation will happen. If it happens slowly enough, THEY WON'T UNDERSTAND. Hyperinflation is a loss of faith in the currency. THE REST OF THE WORLD CAN DO THAT TO US, but we won't wake up until the cash comes flooding home because no one wants it and everyone is dumping it. We will keep going on until they won't let us any more.

Legitimation crisis, my fellow bitchex.

Mon, 12/10/2012 - 16:04 | 3049472 Bastiat
Bastiat's picture

 

"THE REST OF THE WORLD CAN DO THAT TO US"

Exactly.

Mon, 12/10/2012 - 17:39 | 3049847 NotApplicable
NotApplicable's picture

Thanks for the coherent, on-topic comment. I was beginning to doubt there was one in this whole thread, with all the diversions it's filled with.

Mon, 12/10/2012 - 20:08 | 3050275 Dr. Sandi
Dr. Sandi's picture

Maybe that's the real reason the 2013 edition of US Bogus Bux are being printed in the same colors as Monopoly money. Even when there's a glut of the things, we can still use them with everybody's favorite board game.

That means Merican Money will always have SOME value above that of the cotton it's printed on.

Mon, 12/10/2012 - 15:58 | 3049390 tickhound
tickhound's picture

Regarding "symptoms" there is merit in this article....

But what AMAZES ME STILL, is how so few actually understand the SYSTEMIC problem our scheme is facing.  The problem is in the scheme, not the reactions to the scheme.  The reactions are predictable.

Let's take Singer's first line: 

Let me make a few comments and observations on the current investment "scene."  Scene should be replaced by "scheme."

The "SCHEME" is in HOW MONEY IS CREATED... the "SCENE" is how to react to the ponzi "SCHEME" as it reaches post-climax.

In our system, money is debt.  Money only comes into existence through loans, which must be paid back at interest.  Since the PRINCIPAL of the loan is all that is created, the INTEREST does not actually exist.  Since the interest payment must be scalped from the principal in circulation, default is in effect built into the system. 

To keep default to a "respectable" societal level, new loans are always needed to create "new money" to pay down the interest that didn't exist in the money supply.  The SCHEME starts to fold when NEW LOANS or demand for new loans, weakens.

This is why our "FIXES" are always the same... and are simply different ways to produce the same thing, GROWTH.  Growth is what every ponzi scheme needs.

These FIXES are predictable, and sadly, these fixes are what even we here at ZH often argue about amongst one another.

1)  Lower the standards for qualification of new loans.

2)  Lower the interest rate to entice borrowing to create new money to pay down interest that doesn't exist in the money supply. 

3)  Higher taxes - pulls growth forward to meet interest payments that the government can't meet due to lack of new loan demand needed to cover interest payments that don't exist in the money supply.

4)  Lower taxes - creates "growth" or investment to eventually expand the money supply and create a "healthy" evvirnoment to produce new loans to meet interest payments that don't exist in the money supply.

5)  Or find a new planet, find a new bridge to build, find a new country to exploit, find a new technology... to produce new loans to meet interest payments that don't exist in the money supply.

THE FIX is always GROWTH, like every ponzi scheme.  New loans are always needed to expand the money supply (create new money) so that the interest due on previous loans (which doesn't exist in the current money supply) can be paid.

RINSE AND FUCKING REPEAT.

Every ponzi scheme ends when new money creation stalls.  And since new money is only created by loan demand... YOU ARE HERE.

SO new money formation diminishes (loan demand vanishes)... the FED's answer will always be to entice you to borrow.  If it can't create this demand through lower interest rates, the Central Bank becomes the borrower of last resort... YOU ARE HERE.

Worse yet, for our system... is that there is little REAL DEMAND for loans at near zero %.

And if you personally DIDN'T LIKE a $100k loan offer at 3%, you're gonna fucking HATE IT at 4%.

There is no real fix now.  Like all ponzi schemes, the shocks are SHOCKING as it nears end... YOU ARE HERE.

SO, remember... The casino never cares how 'knowledgeable' its players are... ONLY that they keep playing.

Markets are meant to be confusing and retail investors should be confused... ITS THE POINT.  Lack of knowledge isn't a 'problem' in our system, its a vital cog.

Knowledge of the inherent theft built into the system, would only bring its demise forward... WE ARE NOT HERE YET.

Hi MOM!

Mon, 12/10/2012 - 17:00 | 3049707 trav777
trav777's picture

a new planet?  Lol.  Would only get us one more doubling interval.  Instead of midnight, the bottles fill at 1 past.

We could find 1k earths and have only 10 more doublings...this is an easy geometric growth problem to measure.

If we look at energy production growth, what's that been running, like 3%?  5%?  So we manage all of 24 years to max the new earth's production rate, best case?  At 5%, we could swallow the 1024 earths in a century and a half.  Red Queen, checkmate.

Mon, 12/10/2012 - 17:40 | 3049849 tickhound
tickhound's picture

Hehe, well it was an all inclusive post and I didn't want to alienate the Krugman contigent with something like math.

Mon, 12/10/2012 - 18:05 | 3049916 centerline
centerline's picture

lol - I thought Malthus was ruled an idiot by those who suggested technology and redistribution are the keys to perpetual growth.

Mon, 12/10/2012 - 18:12 | 3049941 Aurora Ex Machina
Aurora Ex Machina's picture

Criticisms of Malthus are usually ignorant: he postulated as best he could, given the information he had.

Mon, 12/10/2012 - 18:28 | 3049977 Seer
Seer's picture

Criticisms are based on programming, programming by TPTB.  TPTB live OFF of growth.  Malthus' view pretty much undercuts their very existence.

If anything, Malthus said WAY more than was necessary. "Perpetual growth on a finite planet" is sufficient.  BIG = FAIL!

Mon, 12/10/2012 - 18:11 | 3049931 Aurora Ex Machina
Aurora Ex Machina's picture

Ahh, despite the flaws, at least someone understands the Red Queen. At the moment, the major competitors are tinsey, winsey. Or we could just mix some CRE's with MRSA's and watch the fun.

The 20th Century was one long path of upwards fecundity, man conquering nature and all.

 

Note ~ I don't agree with your stance, Trav, but at least you're thinking about it in the right manner.

Mon, 12/10/2012 - 18:26 | 3049970 tip e. canoe
tip e. canoe's picture

"Although host manipulation is likely to be costly for parasites, we still have a poor understanding of the energetic aspects underlying this strategy. It is traditionally assumed that physiological costs are inevitably associated with mechanisms evolved by parasites to induce the required changes in host behaviours. While most energetic expenditures of parasites relate primarily to bringing about the altered behaviours, manipulative parasites also have to consider the condition of their host during the manipulation. Here, we suggest that because of this trade-off, the energy required to accomplish parasite-induced behaviours may represent a key energetic constraint for parasites. Depending on the energetic expenditures specific to each type of manipulation, parasites should undergo selection to secure resources for their host to allow them to perform manipulated behaviours"

voila

Mon, 12/10/2012 - 19:07 | 3050058 Aurora Ex Machina
Aurora Ex Machina's picture

Retro-Horror in the model of the 1980's

HGT is an ancient method for bacteria from different lineages to acquire and share useful genetic information they didn't inherit from their parents. Scientists have long known about HGT and known that when a transferred gene confers a desirable trait, such as antibiotic resistance or pathogenicity, that gene may undergo positive selection and be passed on to a bacterium's own progeny, sometimes to the detriment of humans.[source]

 

Can she alone feel the music of the air trembling between the wings of the angels, and make or remake a body from it?                                   
—Luce Irigaray, Marine Lover: Of Friedrich Nietzsche, 176

Mon, 12/10/2012 - 18:23 | 3049963 grid-b-gone
grid-b-gone's picture

I started buying PMs a little late, so ixnay on the exponential athmay, please.

Mon, 12/10/2012 - 17:09 | 3049737 Sweet Chicken
Sweet Chicken's picture

+1 Dude, great fucking post! :thumbsup

Mon, 12/10/2012 - 18:21 | 3049957 Seer
Seer's picture

I think "scheme" sounds too contrived.  That is, I think that it somehow conveys an alteration of some existing method- a defrauding of the existing.

I like the word "premise."  I think that, if one were feeling as though it would make any difference, that you could actually get out into the debate stream.

As I've been saying, operating under a bad premise allows for a LOT of abuse.  It provides a big disconnect between reality and make-believe (the more people buy in to it).

That said, it's easy enough to bash something existing.  Much harder to come up with some "alternative."  All I need to kinow is that I have NO plans on being responsible for coming up with some universal alternative: I believe that diversity, which is how nature manages to continue, is necessary.

Mon, 12/10/2012 - 19:19 | 3050092 tickhound
tickhound's picture

I agree.  Choice of words is critical depending the audience.

But understanding the flaws in the existing system is vital for any real alternative solutions/systems to develop or be accepted.

I am unsure of how to create awareness.  I am unsure of the "economic" solution.  But I am glad to see these discussions have finally reached this forum in greater frequency.  It's been a while comin'

Tired of debating the "best horse in the glue factory" - seer

Mon, 12/10/2012 - 22:13 | 3050597 Urban Redneck
Urban Redneck's picture

Start with where Singer left off:

Capital will go where it’s welcome. It is subject to an understandable rule of law, regulation, fair and attractive taxation, and the quality of life.

This isn't a new phenomenon.  It is happening and has been happening for a couple decades.  Dubai doesn't have any oil, Ireland is plagued by the Irish, but they made themselves attractive to capital.  On the other side of the spectrum RSA decided that they would rather buy US companies than US government debt, and relocate them to the sandbox, where domestic industry now consumes almost 2 million barrels of oil a day (that is no longer fueling US GDP).  The opportunity cost just of the DPW fiasco being presumed to result from Arab capital no longer being welcome in the US could easily be quantified above a trillion dollars.    

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