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7 More Years Of Low Rates.. And Then War?

Tyler Durden's picture


While chart analogs provide optically pleasing (and often far too shockingly correct) indications of the human herd tendencies towards fear and greed, a glance through the headlines and reporting of prior periods can provide just as much of a concerning 'analog' as any chart. In this case, while these 3 pictures can paint a thousand words; a thousand words may also paint the biggest picture of all. It seems, socially and empirically, it is never different this time as these 1936 Wall Street Journal archives read only too well... from devaluations lifting stocks to inflationary side-effects of money flow and from short-covering, money-on-the-sidelines, Jobs, Europe, low-volume ramps, BTFD, and profit-taking, to brokers advising stocks for the long-run before a 40% decline.

Stocks look eerily similar...

Income inequality has ramped back to the same levels...



and Rates look awfully similar.... (h/t @Not_Jim_Cramer)

and that didn't end well... (War!)

But when we look at the headlines in the Wall Street Journal from mid 1936 to mid 1937 as the market topped out, dipped, was bought back (orange oval), then collapsed 40% in 3 months, nothing ever changes...



Government Bailouts Repaid - Bullish Implications...


N.Y. Central Has Repaid All Government Loans
The Wall Street Journal, 978 words
Dec 1, 1936
WASHINGTON Numerous railroad developments here yesterday were climaxed by the announcement of RFC Chairman Jesse H. Jones that New York Central had repaid all of its government loans, totaling $16,858,950, most of which was not due until 1941.

The Buying Is Not Speculation - Cash On The Sidelines...


It's Cash Bull Market With Little Inflation, Says Exchange Bulletin
The Wall Street Journal, 169 words
Dec 16, 1936
"This is eminently a cash market, and as such is relatively devoid of that major characteristic of speculative inflation, the use of borrowed money." says the December Bulletin of the N.Y. Stock Exchange.

Inflationary Side-Effects - Buy It All It's Going Up...


Wheat Prices Soar To 7-Year Highs On Heavy Buying Stimulated by Broad Advances in Foreign Pits
The Wall Street Journal, 1497 words
Dec 19, 1936
CHICAGO An avalanche of buying, encouraged by buoyancy in foreign markets, particularly in Winnipeg, swept wheat prices to the highest levels since December, 1929, Friday.


But... 3 days before...

The Wall Street Journal, 1027 words
Dec 16, 1936
As commodity prices continued to advance yesterday to the accompaniment of increasing public speculation in futures markets, signs of a feeling of caution appeared from widely separated centers.

As Goes The US So Goes The Rest Of The World...


London Trade Stimulated By Wall Street Strength; Averages at New Highs
The Wall Street Journal, 859 words
Nov 6, 1936
LONDON Overnight strength in Wall Street considerably stimulated the stock market yesterday. Dealers again arrived earlier than usual in anticipation of activity in international issues and found large buying orders in these stocks awaiting execution.

Global Economy To Lift Stocks...


London, New York Stock Transactions Largest in Months - British Brokers Stand in Queues to Fill Orders Activity Ascribed to World Efforts to Revive Trade
The Wall Street Journal, 956 words
Oct 8, 1936
Growing realization that the determined international effort now being made to sweep away trade barriers will be followed by improved business conditions throughout the world brought a rush of business to the security markets in New York and London yesterday such as not been seen for months.

Devaluation Always A Winner... (Market Prices Prove Economy Likes It)


Wall Street Weighs Devaluation Effects On U.S. Markets; Sees Little Likelihood of Dumping

 The Wall Street Journal, 1759 words
Sep 28, 1936
Rising security and commodity markets Saturday gave ample indication of the financial district's "bullish" interpretation of the U.S. Anglo-French monetary agreement.

Markets Cheerful Over Devaluation; Morgenthau Not Afraid of Dumping
Selective Buying Here and Abroad Motors and Other Shares Held To Benefit From Improved World Trade Are Strong Commodities Less Responsive International Markets
The Wall Street Journal, 1726 words
Sep 29, 1936
A note of cautious optimism was sounded by leading stock exchanges of the world which were open for business yesterday.

Equity Valuations Irrelevant...


Earnings Yield of 15 Stocks 4.8%, Compared with 9.4% Ten Years Ago
The Wall Street Journal, 1280 words
Aug 7, 1936
Industrial earning power is valued nearly twice as highly in the current stock market as it was ten years ago.

Europe Ever The Optimist Even In The Face Of Dismal Reality...


France Optimistic Despite Continuing European Tension - Growing Franco-English Cooperation Inspires Confidence
The Wall Street Journal, 652 words
Dec 5, 1936
Despite the unabated international tension and sudden menace of a constitutional crisis in Great Britain, the continuance of quarrels between Right and Left wings of the Popular Front, and the persistent antagonism between employers and labor, the general feeling in France is rather optimistic than pessimistic.

Short Covering As Ever...


Active Short Covering Sweeps Grain Prices To New High Levels - Chases Bears
The Wall Street Journal, 1345 words
Dec 2, 1936
New highs for the season were recorded in wheat, corn, rye and oats Tuesday. Spot red winter wheat advanced to the highest level since February, 1929. The sharp upturn, which boosted December corn almost 5 cents, and December wheat about 3 cents, was due principally to short covering by those made uneasy over the sale of an unusually large quantity of spot wheat out of local store, and by generous snowfall over the grain belt. Early in the session the market ruled easy on reports of rain and snow, and predictions for continued unsettled weather.

Government Spending Cuts Cause Concern...


Sabotaging Federal Economy
The Wall Street Journal, 412 words
Dec 5, 1936
Even the modest beginning which is attempted by WPA officials to reduce cost of government by cutting down the relief roles is encountering strong opposition. It is perhaps only natural that the workers themselves should object, although their methods of protesting through "sitdown" strikes, not to mention the violence which has manifested itself, may be open to question. But much more ...

States And Taxes...


Sales Tax Repeal May Unbalance Kentucky Finances
The Wall Street Journal, 1002 words
Jan 14, 1936
LOUISVILLE, Ky.--Repeal of Kentucky's 3% sales tax, effective the moment Governor Albert B. Chandler signs it, probably Wednesday will deprive the state of $3,500,000 of revenue budgeted to the expiration of the biennium ending June 30, 1936 and the counties of $1,750,000.

The Foreign Money Will Save Us...


Financial Centers Expect Greater Foreign Interest in Our Securities As Congress Delays Alien Tax Boost - Foreign Interest Here
The Wall Street Journal, 765 words
Aug 6, 1937
Some resumption of foreign interest...

Money On The Sidelines...


The Wall Street Journal, 590 words
Jul 1, 1937
While the Street remains in a cautious frame of mind, there are undoubtedly more possible buyers than sellers around, and it would not take a lot of encouragement to get these gentlemen aboard. Feeling in brokerage circles is that stocks are more likely to advance on any break in the unpleasant headlines these days than to decline far on a continuation of current uncertainties.

Jobs And Europe never far from fear...


The Wall Street Journal, 683 words
Jun 29, 1937
Certainly the market was more active on the downside, which surprised a lot of traders who had expected otherwise. The labor and foreign situations remain the main factors in the picture, and brokers feel that these have not changed one whit for the better thus far.

Buy The F##king Dip...


The Wall Street Journal, 508 words
Aug 24, 1937
A rather depressed feeling is extant in Wall Street as small volume and lower prices continue. Yet there are not many bears in the Street so far as the long pull is concerned. Traders still are stubborn in their theory that stocks are reactionary at the moment from lack of interest rather than any important liquidation. This is the period of the year when business takes a final breathing spell before the more active Fall and some think the stock market is doing likewise and that better days are ahead.

Rallies had Real Volume Then - No Low Volume Ramps...


The Wall Street Journal, 564 words
Aug 16, 1937
If Saturday's volume was any indication, revived interest in the stock market is here in the opinion of the Street. Furthermore the scope of trading Friday and Saturday indicated a broadening interest which included medium priced as well as low priced issues on contrast to the extended period wherein so-called "quality" stocks held sway in a limited market with small volume.

And At The Top... Brokers Suggest Stocks For The Long-Run (based on 'expectations')


The Wall Street Journal, 665 words
Aug 7, 1937
Profit taking for the week-end brought prices down in yesterday's market, but the undertone remained steady and brokers said there was nothing important in the character of the selling. Many houses were advising the purchase of favored issues on any further reactions. Metal shares ended the day with advances in many cases. There was impressive buying reported in the copper issues largely for long pull purposes.

The Wall Street Journal, 649 words
Aug 10, 1937
While volume left much to be desired, the expectation of stronger and more active markets continued to pervade Wall Street. Moreover, the general business picture is regarded as more pleasing than at any time since the so-called Summer "lull" came into force. Incidentally, the seasonal letdown thus far has not proved to be as extensive as many predicted and expected. Brokers say that many clients are away and that there are others who will be replacing their sold-out long positions in coming weeks.

See - it really is never different this time. It merely appears so since - as Kyle Bass so eloquently noted, the brevity of financial memory is about two years...



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Tue, 11/12/2013 - 20:33 | 4148179 LetThemEatRand
LetThemEatRand's picture

The heirs of the guys in charge then (the ones who own the Fed, whose names we don't know), are in charge now.   But I suppose they are technically different people, so I suppose it is also different this time.

Tue, 11/12/2013 - 20:46 | 4148212 TruthInSunshine
TruthInSunshine's picture

The shorts have been decimated, while the valuations of equities are at very nearly as irrational, and more so in some cases, as 1999's bubble - and the foundational structure of the real economy is far worse than then, and debt loads (both government & household) are multitudes higher than then.

And then there's that whole record margin issue...while CONgress continues to allow financial institutions to cook their books...mark-to-Unicorn & gettin' paid to keep real estate off market by BernYellen.

Yellen is going to have to literally double the monthly dosage of QE bad medicine just keep the Bear Cavalry at bay.

Double or nothing, bitches! And then to QEinfinity & beyond!

Domo arigato, Abe Kuroda.

Tue, 11/12/2013 - 20:53 | 4148239 Chris Jusset
Chris Jusset's picture

The US will have 0% inflation and 0% interest rates (ZIRP) for the rest of its existence.  The US's current ultra-fragile house-of-cards will collapse once either inflation or interest rates increase by a material amount.  Thus, the government has no choice but to lie about the inflation data ... and to keep interest rates artificially low into perpetuity, lest everything collapse.


Thus, the headline could just as easily read "700 More Years of Low Rates"

Wed, 11/13/2013 - 02:50 | 4149025 economics9698
economics9698's picture

I think when people understand they can adopt old banker tricks and reverse the tables on the bankers, kill a few Federal Reserve owners, things will change.  Hang them high.

Wed, 11/13/2013 - 07:34 | 4149193 negative rates
negative rates's picture

They were just as corrupt in 37, probably more so. Our porblem today is that we added a bucket of greed and shovel of ignorance since then, so now that corruption has increased exponentially.

Wed, 11/13/2013 - 09:01 | 4149301 Keyser
Keyser's picture

Pfft, they be lucky if we make it to the end of the decade before a stiff breeze comes along and destorys the ponzi scheme. 


Tue, 11/12/2013 - 20:51 | 4148243 AllWorkedUp
AllWorkedUp's picture

Exactly. At the end of seven more years and QE tripled, they'll scream "more QE". By then the paper price of gold will be $500 and the Chinese will still be buying, and all of us goldbugs will be fucking broke.

Oh yeah, and the USD will be at all-time hgihs.

Tue, 11/12/2013 - 22:52 | 4148536 RafterManFMJ
RafterManFMJ's picture


Don't matter, I'll be glad to live in a van down by the river, the river that contains my dear lost gold, guns and ammo.

Tue, 11/12/2013 - 20:34 | 4148184 TeamDepends
TeamDepends's picture

Seven years?!  We ain't got seven weeks, man!  In case you weren't paying attention, we just got our asses kicked!  Marines, we are leaving!!

Tue, 11/12/2013 - 22:30 | 4148486 Jungle Jim
Jungle Jim's picture

To TeamDepends:

Truly. Yea, verily. You said it, brother. We are being crushed now. Good Eighties movie reference too.


Wed, 11/13/2013 - 05:45 | 4149132 They_Live
They_Live's picture

This little girl survived longer than that with no weapons and no training.

Wed, 11/13/2013 - 07:55 | 4149220 overmedicatedun...
overmedicatedundersexed's picture

they live, the B movie life, the script sucks.

Wed, 11/13/2013 - 08:03 | 4149227 BlankfeinDiamond
BlankfeinDiamond's picture

Game over, man. Game over.

Wed, 11/13/2013 - 14:32 | 4150825 aardvarkk
aardvarkk's picture

Pull back and nuke 'em from orbit.  It's the only way to be SURE.

Wed, 11/13/2013 - 09:02 | 4149307 Keyser
Keyser's picture

Yeah, but she wasn't a central banker with zero common sense. 


Tue, 11/12/2013 - 20:37 | 4148188 CClarity
CClarity's picture

Debt jubilee coming up.  But it won't be pretty out on the streets.

And physical confiscations will be rampant.

Tue, 11/12/2013 - 23:33 | 4148672 HulkHogan
HulkHogan's picture

As long as the NFL and SNAP still exist, nobody will care.

Wed, 11/13/2013 - 09:03 | 4149308 Keyser
Keyser's picture

By confiscations do you mean looting and rioting? 


Tue, 11/12/2013 - 20:35 | 4148190 DestituteYetJovial
DestituteYetJovial's picture

War... war never changes.

Tue, 11/12/2013 - 20:41 | 4148208 Agstacker
Agstacker's picture

Upvoted for fallout reference :)

Tue, 11/12/2013 - 20:36 | 4148192 stant
stant's picture

that 10yr rate is creeping up again 2.77. if it gets over 3 again they will have to find somebody to free the shit out of.

Tue, 11/12/2013 - 22:34 | 4148497 wee-weed up
wee-weed up's picture

Obama might not want to wait until it gets over 3...

He needs a humongous diversion from the ObamaCare fiasco!


Tue, 11/12/2013 - 20:39 | 4148203 Running On Bing...
Running On Bingo Fuel's picture

War now! The rates will follow accordingly with the success of war!

GO! Blaze the trail.


Tue, 11/12/2013 - 20:40 | 4148206 Who Laughed
Who Laughed's picture

To what extent has ZH contributed to all these heavily shorted equities and indices? (which also happen to be among the best performing..)

Tue, 11/12/2013 - 20:48 | 4148235 Tyler Durden
Tyler Durden's picture

Well, if you actually read ZH you would know that in September 2012 we said the best performing strategy would be to go long the most shorted stocks: "Presenting The Most Shorted Stocks", confirmed a year later in "Presenting The Best Trading Strategy Over The Past Year: Why Buying The Most Hated Names Continues To Generate "Alpha""

Then again, since there has been no such thing as a "market" since 2009, only idiots were encouraged to make money by betting on greater idiots.

In the meantime, if you have a problem with the daily exposition on these pages of the endless farce modern economics, "markets" and society have become, confirmed by the now 5th year in a row of socioeconomic life support with the central bankers' all in gamble amounting to $15 trillion and counting of liquidity injections, you are always free to a hopium brainwashing at any other place of your choosing.

Tue, 11/12/2013 - 21:12 | 4148311 fonzannoon
fonzannoon's picture

Tyler you gotta jump in here ane mix it up with us moar often. It's what made this place so much fun.

Tue, 11/12/2013 - 21:38 | 4148363 CoonT
CoonT's picture

2nd to MOAR

Tue, 11/12/2013 - 23:36 | 4148681 HulkHogan
HulkHogan's picture

I 3rd that. I may write something MOAR stupider than normal just to get Tyler to respond like that.

Wed, 11/13/2013 - 08:23 | 4149247 Karl von Bahnhof
Karl von Bahnhof's picture

And call back Francis and MDB, please. Also Boris is little quiet.

Wed, 11/13/2013 - 10:17 | 4149573 Fire Angel
Fire Angel's picture

I 4th that. It's nice to see you down here in the basement, kickin' ass and takin' names. Fire Angel

Tue, 11/12/2013 - 21:13 | 4148313 Who Laughed
Who Laughed's picture

Yeap, I usually try to read every article that comes through ZH. 
What i'm saying is that the continuing proof (and it is) on ZH of an impending (but never quite realised) doom must be contributing to the negative outlooks on the stock market and subsequent short positions taken. 

To be clear, I believe we're in trouble and I think we're close.

However, I feel the urgency for a 'bear-down' hinted at in figure 1 could be enticing short positions (and short covering). which in turn, as ZH noted are further fueling the madness. 


Tue, 11/12/2013 - 21:22 | 4148331 Dr. Engali
Dr. Engali's picture

Most people here know that this "market"/ policy tool will never see a major downturn again. There will never be an opportunity to make major money on the downside. Any shorts that get their asses squeezed out of this market are not short because they are visiting these pages.

Tue, 11/12/2013 - 22:19 | 4148461 forwardho
forwardho's picture

Lets try not to take ourselves to seriously.

As of 2100 EST  6000 people "looked" at this article.

ZH is great, the posts and comments hit my confermation bias.

Always look at the number of hits on this site and realize we are a very, very small comunity.

Wed, 11/13/2013 - 09:40 | 4149442 S73
S73's picture

If we were a large community, these banker ATMs called markets would not exist as they currently do.

Tue, 11/12/2013 - 22:23 | 4148473 itchy166
itchy166's picture

Crashing something as large as the global financial system isn't instantaneous, its been crumpling for five years...

Wed, 11/13/2013 - 04:52 | 4149098 Fedaykinx
Fedaykinx's picture

i've resigned myself to the fact that it's probably going to take much longer than most realize

Wed, 11/13/2013 - 12:59 | 4150333 Kobe Beef
Kobe Beef's picture

That's why I left the country. I've gotten on with my life while the USSA dies. It's a sunk cost, and my life is not.

However, give me a heads up when the Republic is returning, and I'll see you on the fields of San Jacinto.

Wed, 11/13/2013 - 05:03 | 4149103 Squid-puppets a...
Squid-puppets a-go-go's picture

@Who Laughed

so hey, what's the insinuation? that ZH is irresponsible if it leads to some shorting in the market?

ZH uses words alone, and in that capacity it can be seen as merely a counterbalance to the always ever so positive spin in the mainstream media.

Take a look at the language in the article above - at least in the 30's they would give a (however dismissive) nod to contrary opinion or bearish sentiment. Thats almost non existant with today's mainstream media

ZH is a counter balance to their irresponsibility, and lets face it, if ZH was successful at dragging prices down, what's the ultimate result?  The inevitable crash comes from a lower height.

So, again, what precisely is ur problem? or was it just an observation..?

Wed, 11/13/2013 - 10:11 | 4149553 Who Laughed
Who Laughed's picture

I didn't intend to insinuate anything and I'm very sorry I upset Tyler and the group.


My concern is that people at the top are benefiting from these negative market perspectives (not mainstream ideas) through short covering

Who is short and why?

Are short positions, historically, small in volume?

How greatly are short covers contributing to price growth?

Any help appreciated!


Wed, 11/13/2013 - 07:48 | 4149207 BandGap
BandGap's picture

I don't use anything here as an investment tool. I just listen, prepare and vent on occasion.

Wed, 11/13/2013 - 09:16 | 4149345 Raging Debate
Raging Debate's picture

Well Who Laughed, if you look up my former comments I only gave two pieces of advice on trading and that was in 2012 and not on shorting or gold.

One comment was to invest in the market for 2013 and the other invest in the Yuan. I am not much into vanity to claim prizes for being right but not all of us short here.

Fearful (rightfully so), intelligent folks paying attention here and this service highlight the cycles of the corruption in our species and I trade accordingly. Government creates all sorts of distortions to be mindful of and while tyrannical behavior is also cyclical and of course it is gloomy and since history rhythms doom of war and other disaster should be discussed.

Personally, I just dance until the music stops. I am not into advocating violence as the solution. Build some tech for the old white control freaks and make them dependent on you, then gently steer the big ship a couple degrees if possible. I think more people here in general should spend some time looking in the mirror before eternal condemnations.

I own a small business also but I do not see it advantageous to grow it over the next several years, 2021 most likely. In these cycles, the small innovator or producer is crushed, consolidation occurs until there is nothing left to invest in, then the government starts to starve on tax revenues (offshoring wealth/evasion) and eventually changes course because it has to. Let's pray we get no WW3, Ill take stagflation for another decade over 2 billion lives lost and a grief filled rebuilding process...

Tue, 11/12/2013 - 21:26 | 4148340 farFromEq.
farFromEq.'s picture


I (we) hear you, about getting to the root of what essentially comes down to mis-pricing. But, this was kind of a whimsical post. I mean, the obvious question that comes to mind when I see this article is what is the difference in M2 growth between today and the '30s? And while I appreciate the provocative post, they shouldn't be provocative at the expense of mis-leading the loyal readers.

Appreciative of the work here, really.



Tue, 11/12/2013 - 23:42 | 4148702 HulkHogan
HulkHogan's picture

I've read ZH since the beginning (Flash Crash) and have never mistaken it for a "stocks to buy and sell" site. Though, Tylers if you want to make some money, offer a newsletter for $1,000+ yearly subscription. I think you'll do very well.

Wed, 11/13/2013 - 06:31 | 4149146 falak pema
falak pema's picture

In defense of "Who laughed" and the essence of his post IMO :  ZH is a great site for analysing current Pax Americana generated dystopia, via it Admiral ship WS; to which ZH, by being actively involved on a day to day basis, has a privileged position not only to understand its hidden mechanisms-- brilliantly exposed here continually -- but also its future implications.

What is lacking in the ZH postings as proponent of the "doom and gloom" culture, based unquestionably on HARD FACTS and historical perspective, is a clearer assessment of the logic of Mindset of the world Oligarchy. We need a more balanced perspective and ZH is proponent only of ONE side of the argument. Admittedly, the MSM is there for the other side, and its all smoke and mirrors alas, in regulatory capture of US and Euro media and corrupt government.

But ZH does not use its dialectical skills to make a case, for example, for global debt jubilee; a debt jubilee seems inevitable as this huge debt can never be truly paid back as we will hit that asymptote one day of zero return on perpetual  fiat generation from out of the CB books. To avoid war, which nobody sane wants, the route to a debt jubilee requires more positive proponents in the Media of ways of mixing monetary policy with forced and organised debt write offs and reengineering of the banking and shadow banking sectors globally. ZH could be a spokesman for that solution. Instead of seeing only the inevitable repeat of the 30s as the only possible outcome.

Treating the crony capitalist class and their compulsive "print to infinity bankers" as latter day Neros, hurtling us all to our collective economic demise, may be the correct bigger picture. But, in new Rome there are still honest people who have other solutions to propose besides dystopian binary logic.

This current FED logic is not the only picture and ZH does not present the logic of other possible OPTIONS fairly. The world is multi polar and other solutions do exist.

ZH is stuck in its own ideological rut that it has established on a "prejudged" basis, aka since 2008 fall, as the ONLY possible outcome. We stay in the TD fight club and dystopian thread like it were the Bible of the Contrarian libertarian religion with Ron Paul, a marginal politician of Pax Americana tradition, as the Messiah. Austrian economics elevated to religion and macro economics debased to the devil incarnate.


Wed, 11/13/2013 - 06:59 | 4149163 Squid-puppets a...
Squid-puppets a-go-go's picture

"a clearer assessment of the logic of Mindset of the world Oligarchy" would presume their is only one illuminati. There are several illuminati, individuals within which intersect each nexus.

Thus it is an impossibility to outline "the logic" because there are several competing factions, not one cohesive logic

there are some common threads between these but i believe tyler adequately exposes such motives through his sarcasm and cynicism.

Global debt jubilee? It makes nothing but sense to me but i've yet to hear even ONE MSM pundit or politician/beaurocrat even utter it as a possibility. So i can imagine Tyler would feel he's wasting his breath


But for what its worth, I'm not sensing the same sense of certainty from Tyler (in what direction the future will take - he remains as vitriolically concrete in his assessment that the system sucks) in the last few months. I'm getting a sense of despondency, even.

Which is completely forgivable given how long its taking for the music to stop

Wed, 11/13/2013 - 12:11 | 4150057 gwiss
gwiss's picture

"Not sensing the same sense of certainty.."

Think of it like this.  You're driving behind a car with an apartment full of stuff tied to its roof rack with dental floss, traveling at 75 mph down the Interstate. The kiddie pool already blew off 2 miles ago, and although you tried to dodge, it took off your antenna and side mirror.  Every time you pass a semi going the other way, the wind surge causes the mattress at the base of the whole mess to levitate and tremble.  So -- which semi is going to be the one?

In a way, it's a bit of a mind fuck, this constant being ready for disaster.  Wears you down.  Which is why eventually a lot of people are going to give up on it.  And only then will the shit truly hit the fan.

The Tylers are coming to grips with the inherent unstoppable nature of it.  No one listens or cares, because honestly the rest of the passengers don't have the ability to truly contemplate things on a systemic level.  Left to their own devices, they would not be capable of designing a ship, which is why they are not capable of understanding that the ship is well and truly hosed.  Coming to grips with how unfortunate it is being the first few to know the ship is going down, how interminable the wait is because the water takes a long fucking time to fill the hold, especially because you are bracing yourself the whole time for how freezing cold that water will be.  And only when the ship actually tips up vertically does the true horror of how badly this experience is going to suck for everyone, even the truly prepared, really viscerally sink in. 

Wed, 11/13/2013 - 07:48 | 4149206 drdolittle
drdolittle's picture

If I were enriching myself by creating debt and had enough money to buy congress, I would actively work against a debt jubilee. Bankrupting the masses with a sudden contraction in the money supply and taking all their stuff "legally" would be my plan.

Debt jubilee? Only if accompanied by the guillotine.

Wed, 11/13/2013 - 08:43 | 4149270 enloe creek
enloe creek's picture

My simple uneducated old ass thinks the velocity of money is what the fed would like to see going up.
til that happens which it is not while things limp along there will be more qe
maybe TPTB will see the need for a crisis to do more or change tactics but they will not abandone the fight against deflation and the proping up of the dollar. so any melt down in the buck or bonds will be met with some interesting responses

Wed, 11/13/2013 - 13:18 | 4150427 Trickman
Trickman's picture

Bernanke had a very clear view of what he wanted to avoid -- he wanted to avoid the Great Depression. His analysis led him to believe that the major cause/contributer was the restricted liquidity as banks seized up and began avoiding risks. You can't argue that this would not and did not make the Great Depression worse; however, you can argue that Bernanke's approach has its own flaws.

1) Simply making the money available to the banks for lending at lower rates will only marginally increase their lending rate as they are still avoiding risks. Furthermore, the banks are avoiding risks because they took on too many high risks to get into this situation. You need to make the liquidity available, but you also have to address the demand for that liquidity.

2) In the 20s (like now), the income disparity meant that there was a smaller and shrinking middle-class group of consumers to create demand for the good/medium-risk loans and consume production created by good-debt. Increasing the money supply does not correct for this issue in any way, but rather exacerbates it, further shrinking the class of consumers that you want to take loans. 

3) Finally, the whole point of a recession is to redistribute resources away from the inefficient and poor managers. By completely 'avoiding' recession, or really by giving everyone enough cash to 'get through it', we've completely avoided the necessary redistribution to begin growing again. TBTF is a problem that needs to be addressed. TBTF doesn't mean you give them a pass. It means you break them up a la AT&T & the Bells by some arbitrary method -- region, state, branch location distribution -- throw out a small support to give each of them a fighting chance to clean up their mess, and then let them sink or swim. A recession is inevitable, you can't prevent it. But perhaps you can phase it in?

4) I think that certain aspects of the Keynesian approach make sense; however, you'll never get a government to appropriately implement an expansion-dampering + recession-boosting approach, not to mention, the government is too stupid and too slow to ever implement the right policies at the right speed. Given that, the debt needs to be brought under control. We need surpluses and we need them now. That means lots more pain in the short run, but I'd rather pay the bill today than in 5-10 years. Compound interest is a ruthless bitch.

Both 1) and 2) need to be addressed to increase the velocity of money in a positive manner. We've definitely addressed 1), but addressing 2) requires real redistribution, which we have altogether avoided so far via government intervention. Sure, there are the various government redistribution mechanisms; however, these only redistribute income without actually shaking the economic status-quo like a significant recession would and actually tend to reduce socio-economic transfers (ZH had a great chart on this a week or so back). As the economy consolidates (as it always eventually will), barriers to socio-economic movement will be erected so that the top protect themselves (as anyone would do) and the middle class protect themselves and so on. The rich hide behind gigantic corporations, tax havens, whatever to avoid losing their wealth. Middle class workers transition less and do whatever they can to make themselves necessary to their job. These are all natural courses of an economy; however, eventually this causes an imbalance. You get poor people that could be better suited to the middle class or upper class jobs, people in upper class jobs that are woefully inadequate and should be flipping burgers or manually working the spreadsheets themselves, and so you need 3) to shatter the egrarious violations of efficiency and let the market work. Finally, even should we fix the economy by letting it correct and get back into a growth pattern -- our government debt is so extreme that any victory would be short lived without addressing 4) as if the economy did begin growing again, monetary policy would have to be restricted to avoid runaway inflation and another huge crash. Of course, that might be preferable to the fed/govt than making the govt crumble.

Of course, neither the Democratic nor Republican parties are capable or willing to do any of this and the deteriorating education in our country makes it increasingly unlikely that the electorate ever elects enough someones who would make these changes, which pretty much makes us Rome... destined for eventual failure.

Tue, 11/12/2013 - 20:47 | 4148227 grunk
grunk's picture

Seven more years of this shit?

I'm gonna start running cigs from VA/NC up to NYC.


Tue, 11/12/2013 - 22:54 | 4148545 RafterManFMJ
RafterManFMJ's picture

...and Mason jars of 'shine, man!

Tue, 11/12/2013 - 23:27 | 4148650 odatruf
odatruf's picture

I'll get the raw-milk camembert cheese and Cuban rum over the boarder from Canada.

Wed, 11/13/2013 - 09:16 | 4149303 Running On Bing...
Running On Bingo Fuel's picture

Row, row, row your boat:,-67.781952

and then jump on 95,
come on down to Boston man,
and share a glass of wine.


Tue, 11/12/2013 - 20:51 | 4148242 Surrealist
Surrealist's picture

Seven years started in 2008.

That makes it to 2015 tops.

Approx one to two years away, possibly much sooner given central bank QE activities!





Tue, 11/12/2013 - 22:31 | 4148488 Jungle Jim
Jungle Jim's picture

Too long, Surrealist. Too late.

Wed, 11/13/2013 - 00:21 | 4148803 Zero guest
Zero guest's picture

He means 1937 plus 7 years equals 1944 and World War II.


Wed, 11/13/2013 - 07:23 | 4149179 BandGap
BandGap's picture

And the chart is compressed - 2007-2013 is six years, 1930-1942 is twelve years.

War in 2-3 years. The ignition will happen soon, the aggression will build as nations seek relief. Weak countries will "join" strong ones until some resistence is met, like two bullies on the playground.

Wed, 11/13/2013 - 09:15 | 4149344 Keyser
Keyser's picture

I dunno, from the looks of the first chart in this article, it looks like Q1 2014 would be a good time to get back short the S&P...


Tue, 11/12/2013 - 20:55 | 4148248 ebworthen
ebworthen's picture

History repeating and rhyming, unfortunately.

"To me it seems quite clear, that it's all just a bit of history repeating..."

Propellor Heads with Sirley Bassey, link opens in new window/tab.


Tue, 11/12/2013 - 21:19 | 4148328 dtwn
dtwn's picture

What's old is new again.

Wed, 11/13/2013 - 07:35 | 4149196 negative rates
negative rates's picture

We don't need it to repeat, we need to turn back time and then do the job right, rather than just over.

Tue, 11/12/2013 - 20:53 | 4148254 Rehab Willie
Rehab Willie's picture

7 years of tribulation, it's in the bible.

Tue, 11/12/2013 - 21:13 | 4148317 logicalman
logicalman's picture

The Tribulation began in  1913 - it's now 2013

A tad more than 7 years

Tue, 11/12/2013 - 21:12 | 4148257 chump666
chump666's picture

War.  China and Japan.

Japan has almost bought their whole JGB market, with a big auction this Friday.  In a coldwar, no one touches bonds accept for the internal bond buyers.  We are in a cold war now (Obama/Putin, China/Japan and US) but just in denial.  Any yield increase now, until Japan's auction, will be trumped with more all in buys from the central banks.

If BoJ/FED didn't buy yields would be in hyper-space.  Prepare for a major conflict, not quagmire chasing sand bandit wars.  Stand up fight.

China good cop play, they will invade the disputed islands within the next 6mths.

Tue, 11/12/2013 - 22:27 | 4148481 chump666
chump666's picture

China military spending up:

0206 GMT [Dow Jones] Chinese manufacturers of military equipment rally in spite of broader market weakness after China says in a blueprint policy document it will boost its defense capabilities and establish a state security committee that analysts say would work like the U.S. National Security Council. Stock analysts say that China's remarks on defense capabilities will lend a key support to military equipment makers, assuring these companies a steady flow of new orders in the next five to 10 years

Wed, 11/13/2013 - 06:17 | 4149151 Non Passaran
Non Passaran's picture

Pure BS. Nothing to gain, lots to lose.

Tue, 11/12/2013 - 20:57 | 4148265 NOTaREALmerican
NOTaREALmerican's picture

I'm predicting the top 10% will continue to do well.

Survival of the fittest,  bitchez!

Wed, 11/13/2013 - 01:58 | 4148955 prains
prains's picture

LOL, I'm pretty sure you don't mean fittest as in beats per minutes because that's a whole other genre.....and to be honest 'merica I'm not seein it!

Wed, 11/13/2013 - 05:53 | 4149136 CHX
CHX's picture

"Survival of the fittest". That's essentially true for EVERY species, humans included. (Natural) Selection is a universal biological law/reality, but as the world changes, so will the various selection pressures.


Complex dynamic systems are a bitch, bitchez.

Tue, 11/12/2013 - 20:59 | 4148268 adr
adr's picture

What happens during a depression is the consolidation (confiscation) of assets into a few select hands connected enough to finance the theft of them.

Exactly what we have seen over the past six years.

Eventually this leads to war once those who have had everything taken no longer have anything left.

Then those who took everything are perfectly fine with financing the war, so they can have even more. 

Instead of realizing who it was who decimated their lives, they believe the propaganda that it was someone else who caused the pain, instead of the ones sitting in plain site enjoying their spoils.

The solution has always been to hang those who believe wealth comes from conning others into giving it to them instead of working for it.

Tue, 11/12/2013 - 21:05 | 4148288 NOTaREALmerican
NOTaREALmerican's picture

Re:  The solution has always been to hang those who believe wealth comes from conning others into giving it to them instead of working for it.

However, that's the difference between the smart-n-savvy people and the dumbasses.

The dumbasses believe the bullshit created by the sociopaths hired by the smart-n-savvy people.   That's why they are dumbasses and why the smart-n-savvy people have all their loot.

Government + bullshit = politics
Morals + bullshit = religion
Craft + bullshit = spatter art

The sociopath adds value and confusion with high quality bullshit.

Bullshit, ask for it by name.

Tue, 11/12/2013 - 21:15 | 4148322 logicalman
logicalman's picture

You don't need to ask for bullshit.

The real trick is avoiding it.

Tue, 11/12/2013 - 21:06 | 4148295 Zadok
Zadok's picture

Quite astute old chap...

Tue, 11/12/2013 - 21:30 | 4148348 walküre
walküre's picture

I hope Yolanda et al are paying attention and won't fall for the battle cries of the rich who robbed Yolanda et al blind in the first place.

Wed, 11/13/2013 - 07:39 | 4149199 negative rates
negative rates's picture

Tell that to a judge, oh that's right, you can't get close to the judge, and that message would never be sent to the judge, to many layers of corruption to wade through to get through to the judge these days.

Tue, 11/12/2013 - 21:00 | 4148274 q99x2
q99x2's picture

The FEDs war against the United States of America is already raging.-

Tue, 11/12/2013 - 21:05 | 4148280 Dre4dwolf
Dre4dwolf's picture

Price Inflation will not be there until the production of goods and services no longer out-paces the production of currency in circulation.

IE:: If you produce 1000 ipads a day and people earn 1000 dollars a day and the two are earned and produced at the same rate, the price will not rise very much.

But if production of ipads drop to 100 a day, prices will skyrocket.


As long as we produce plastic crap faster than we produce money in circulation there wont be price inflation.

Unless all the dollars held abroad are dumped back into the U.S. (say china offloading its USD holdings in exchange for U.S. goods/realestate/stocks/whatever).

Then you could have a spurt of price inflation.

Wed, 11/13/2013 - 02:01 | 4148962 Odin
Odin's picture

Really, Apple is going to be able to keep pumping out plastic food and energy to stave of inflation perpetually? Man those guys are good...

Wed, 11/13/2013 - 02:07 | 4148974 prains
prains's picture

what about finite commodities?

Wed, 11/13/2013 - 07:52 | 4149215 drdolittle
drdolittle's picture

If you look outside electronics, there's plenty of inflation. Geez. Really? Are you believing the CPI?

Wed, 11/13/2013 - 09:30 | 4149395 Tall Tom
Tall Tom's picture

Dre4dwolf wrote, "Unless all the dollars held abroad are dumped back into the U.S. (say china offloading its USD holdings in exchange for U.S. goods/realestate/stocks/whatever).

Then you could have a spurt of price inflation."


You can bet that if China dumps the USD then everyone else will follow suit. They will be wanting to get as much as they can and not let China buy all of the Value with the Worthless Dollars. It will be a competition between our Creditors to see how much value that they can command.


No...There will not be a "spurt of Price Inflation" as it will not be $1.2 Trillion flooding our economy.


It will be $12 Trillion, from all Foreign Nations, flooding our Economy, at once, the very same time, buying up everything that is not bolted to the floor. All we will have is that $12 Trillion floating around with NO Goods or Services that it will be able to command.


If China dumps do not think that Japan, or any other owners of those "Unlimited Edition, U.S. Government Issued, Serial Numbered Art Prints, featuring our Dead Presidents and Statesmen" Dollars, wont dump their valueless Artwork either  They will trade those for whatever value that they can get.


When one Nation loses confidence then ALL Nations will lose confidence. It will be rather explosive and catch many unaware and by surprise. When it blows up it will be a Spectacular Event.


Sorry chumps...THAT IS A HYPERINFLATIONARY INFERNO...That show is coming soon to the Marketplace in the United States of America.


Get your Tickets...Get your Tickets..Step right up and get your Tickets.


We have a most spectacular show for you here in the United States of America. Get the Ring Side Seat. This show has been brought to you courtesy of your United States Government and Federal Reserve Bank. It could not have happened without them. We owe them such a debt of Gratitude for making this event possible. 


Yes It is going to be a Spectacular Show tonight...a real and unforgetable extravaganza. We are certain that it will leave an impression. You really don't want to miss this one as it will be a Life Changing Event.


Get your Tickets...Get your Tickets. Step right up and get your Tickets.


Hope you all have got some Gold and Silver. That day is approaching fast, sooner than most of you, here reading ZH, may think.


I have got my Golden Ticket. Have you?


Good morning...And...and have a nice day.

Tue, 11/12/2013 - 21:05 | 4148291 augustusgloop
augustusgloop's picture

Who knew when that when Bernanke said he was student of the great depression that he'd plaguerized the whole thing verbatim.

Tue, 11/12/2013 - 21:15 | 4148323 Dr. Engali
Dr. Engali's picture

I hope this shit doesn't go on for another seven years. I'll lose my freaking mind. As far as war goes, it looks to me like hostilities be the U.S Vs. the U.S. Once the U.S is in chaos the rest of the world will follow.

Tue, 11/12/2013 - 21:32 | 4148352 Savyindallas
Savyindallas's picture

I think the charts show that low bond rates did not prevent the stock market crash.

Wed, 11/13/2013 - 05:48 | 4149135 CHX
CHX's picture

How could they? As the economic conditions worsen, more companies miss earnings, more banks and buisnesses go bust, and pension funds having to liquidate some equities to pay out pensioners (=systemic selling pressure), as they can't get the yields needed in bonds. Vicious circle that's already started kicking in. NO. WAY. OUT.

Wed, 11/13/2013 - 07:54 | 4149214 negative rates
negative rates's picture

The middle east is a heart beat away, and should we go there, their is a possibility that we could be alone here without enough inflated money and the rest of the world says "too bad, those super tankers to big for US ports will bypass the US on their way to global growth". Oh yea, our little ships will export our best stuff to be loaded on those supers, but they will come back empty. Reminisit of the 1830's when the europeans were starving from the neapolaen wars and our own farmers (and certainly not our citizens) could barely afford the food they were growing from the high prices, and from those high prices, higher real estate taxes which never went down once the European crisis was over. We had nearly paid off our national debt during that period, and could have reduced the tax base for all, for a very long period of time. Until politicians relized they liked spending money and having the power to tax, so we committed ourselves to doing just that, until something physcially forces us to reverse our position.  

Tue, 11/12/2013 - 21:41 | 4148358 walküre
walküre's picture

Hyperinflation will kick in before 7 years are up. Money is worthless and more and more people figuring things out. Speak with producers who are making food that you need to survive. Many already apprehensive about accepting Benny's clownbux for their grains, hay, dairy, eggs and so on. Farmers will lead the way followed by workers who can't buy what they need to survive with funny money. The establishment is rushing to make cash obsolete as it will allow them to hide the problem. We all know that cash is already running like water. Question is, how much is everyone willing to give their daily labor for this diluted piece of shit paper?

Many people in this country already eating garbage and they don't realize it. The food they eat is garbage. Made cheaply from derivatives because the real stuff would be way too expensive. Check the list of ingredients on your food packages. It's plastics or metals.

Washington State was the last state in the union to vote on GMO labelling. They "voted" no. The GMO lobby sponsored the vote against labelling all products across the US with billions. WA was a key state for the plastic food manufacturers.

There will be no GMO labelling in the US as a result and guess what is going in your shopping baskets at your local grocery chain store. Plastic, metals and GMO Frankenfoods.

Guten Appetit!

Tue, 11/12/2013 - 21:45 | 4148381 spinone
spinone's picture

Bet you $100 you're wrong.

Tue, 11/12/2013 - 22:05 | 4148434 walküre
walküre's picture

You're on! I will pay you with 2 dozen eggs when the time comes. At least you can eat them. The $100 bucks won't get you far.

Tue, 11/12/2013 - 23:36 | 4148682 Seer
Seer's picture

Egg on face, literally!

Tue, 11/12/2013 - 21:53 | 4148408 dark pools of soros
dark pools of soros's picture

Don't worry, just change the flavor crystals each day for variety of your sludge!!

Wed, 11/13/2013 - 09:24 | 4149368 Keyser
Keyser's picture

But it has electrolytes!!!!

Wed, 11/13/2013 - 03:44 | 4149058 savedeposit
savedeposit's picture

As long as I convert my hard earned Benny's clownbux for cheap silver at the and of the month, I will accept Benny's clownbux.

Tue, 11/12/2013 - 21:48 | 4148392 IridiumRebel
IridiumRebel's picture


Tue, 11/12/2013 - 21:50 | 4148399 dark pools of soros
dark pools of soros's picture

Moar Woar!!!!

Wed, 11/13/2013 - 00:20 | 4148800 WOAR
Tue, 11/12/2013 - 22:22 | 4148471 seek
seek's picture

The scariest part about the war scenario is looking around to see what country currently looks the most like pre-WWII Germany.


Wed, 11/13/2013 - 05:06 | 4149106 Uber Vandal
Uber Vandal's picture




Wed, 11/13/2013 - 09:25 | 4149376 Keyser
Keyser's picture

Me tinks that if the US pulls that ploy out of the bag one moar time, that Russia and China will spank the US badly, economically. 

Tue, 11/12/2013 - 22:51 | 4148533 rosiescenario
rosiescenario's picture

The chart of the top 10% income share is pretty amazing....had not seen that one before....that may have more to do with the subsequent depression than anything else.

Wed, 11/13/2013 - 00:42 | 4148838 Zero guest
Zero guest's picture

The fascinating simalarity is that by 1937 the Fed thought it was OK to raise interest rates. Now they think it's OK to taper (Which means raise interest rates.).

Wed, 11/13/2013 - 01:00 | 4148864 lasvegaspersona
lasvegaspersona's picture

but they used to lie in the papers back then,,

Wed, 11/13/2013 - 01:36 | 4148917 Dr. Bonzo
Dr. Bonzo's picture

Man I love reading the ZH comments section. Wish some of you guys lived in Hong Kong. I feel like having a few drinks and shooting the shit with some like-minded people.


Good comments today all. Thanks for the great read.

Wed, 11/13/2013 - 01:38 | 4148921 worldofdebt
worldofdebt's picture

Wow, what a great article and great charts!!!

It's OK though... I'll leave you with this below:


Wed, 11/13/2013 - 09:27 | 4149381 Keyser
Keyser's picture

I've said it before and I'll say it again, the only thing Cramer is missing is the big red nose and clown shoes to make his ensemble complete. 

Wed, 11/13/2013 - 02:51 | 4149020 Coldfire
Coldfire's picture

The US, Europe and Japan are all printing like sonsofbitches. But seven more years? Unpossible. Yellen, Draghi and Abe are the bagholders. The war planned for after the crash is simply another generational opportunity to consolidate control. Same as it ever was. But nuclear. Look at how close the Nobel Peace Prize President was to starting WW3 last summer. Add the missing nukes. The military purges. The capital controls. We're getting close.

Wed, 11/13/2013 - 03:23 | 4149048 Rock On Roger
Rock On Roger's picture

The Second Great American War starts in 2016.





fuckin greedy american bullies deserve it

Wed, 11/13/2013 - 03:48 | 4149059 Rock On Roger
Rock On Roger's picture

Oh, I forgot;



Stack On

Wed, 11/13/2013 - 05:41 | 4149129 CHX
CHX's picture

Snack ot :-)

Wed, 11/13/2013 - 05:30 | 4149118 falak pema
falak pema's picture

By then ZH wil have relocated in HK or Shanghai, land of gold jitterbuggers. 

No Problem; as long as you are with the shiny critters you are on the right side of the sidewalk and you can go singing in the rain to the bitcoin joint for a drink and click on your gold backed numbered account for a junket to the Moon! 

Imagine spending a week-end on the Moon and seeing the intergalactic war from outer space sitting on your moon beam ray sipping cocktails made from your vineyard on Mars! 

Wow, we are privileged as the only ones to understand how this will all turn out.

George Lucas got that right! 

Pity its only the 0.01% who can dream about that. But c'est la vie. Rome wasn't built in a day.

New intergalactic Rome will take more than seven days; even tho' we have the NSA to rewrite the book of Genesis.

PS : As a student of the historical context I find that thread posted just awesome. Hopium is such a cure for dystopia. 

Wed, 11/13/2013 - 05:32 | 4149121 dreadnaught
dreadnaught's picture

im betting on 7 months -not 7 years (if not 7 weeks)

Wed, 11/13/2013 - 10:21 | 4149588 Keyser
Keyser's picture

It's a house of cards and all it's going to take is one false move will bring the whole thing down. A loss of confidence in any one area and down it comes. 

Wed, 11/13/2013 - 13:50 | 4150581 FeralSerf
FeralSerf's picture

With today's absolute control of the MSM very few people will actually know the house of cards is collapsing.

If not enough people realize the house is collapsing, maybe the collapse will be (or is being) controlled.

I suspect the house has been collapsing for some time and it's just another "controlled demolition" benefiting the few at the expense of the many.

Wed, 11/13/2013 - 05:38 | 4149125 CuttingEdge
CuttingEdge's picture

The only major war the US is likely to be involved in within seven years is a civil war. Obama's FSA and SS...err...DHS against those home-grown terrorists represented by the Tea Party et al (i.e. hard working middle class America). Does anyone think the DHS bought 2 billion rounds of 9mm for target practice? Perhaps someone can give a justifiable reason why the DHS is one of the recipients of all the information people are fallig over each other (not, apart from the FSA) to input at the ObamaCare portal.

Someone should have put a bullet in that lying sociopathic Kenyan cunt's brainpan years ago. Now, with the damage done, its too late.

Wed, 11/13/2013 - 11:36 | 4149912 Keyser
Keyser's picture

If this happens, the DHS will have their ass handed to them. The US military has proven time and time again that they are not prepared for a guerilla campaign. Patriots will simply avoid the DHS patrols and pick them off one by one. There are far more of "us" than there are of "them". They could possibly hold the city centers in 5 or 6 locals around the country, but other than that, nada. 


Wed, 11/13/2013 - 05:40 | 4149128 CHX
CHX's picture

Tylers, I'd guess the relative volumes were different then? Today's stock mania is really a HFT-mania, a gazillion bids and ask before an actual buy or sell, and then hold the thing for a few seconds, minutes? And record lows in volumes. My guess is, that volumes will be one of signs when the actual meltdown becomes imminent. As sell pressure gets passed a certain threshold, the plunge protection clowns can no longer do anything? Just some random thoughts.

Wed, 11/13/2013 - 07:28 | 4149185 MilwaukeeMark
MilwaukeeMark's picture

People who jumped from the upper floors of World Trade Center building on 9/11/01 knew they were not going to survive their fall. But two things played into their decision to jump, 1) it bought them 20 more seconds of life, and 2) there was always the tiniest, infinitismally small chance that -- somehow -- they might survice. This explains human nature. People will commit to a suicidal financial path because 1) it buys them more time and 2) there is the smallest chance that somehow events will sort themselves out.

Wed, 11/13/2013 - 07:54 | 4149218 Kirk2NCC1701
Kirk2NCC1701's picture

If there is a "war", it sure as hell won't be the rich+powerful Elite and CBs of one country vs. another.  Not when you look at how all the CBs are circling the drain like damn Olympic Synchronized Swimmers.  Minus the sex-appeal of the latter.

More than likely it'll be as a cascading series of civil unrest or 'Arab Spring' style revolts.  When what's really needed is the "storming of the Bastille" and guillotines to roll.  But if we look to Greece or Spain as templates, it's clear that the populace is either too dumb, too numb or too scared to act.  Even at 25% "official" unemployment.

And don't give me the "but they don't have guns" crap, because you clearly do not know your world history:  The people of Eastern Europe overthrew their governments in the '90s (even Romania's dictator Caucescu and his dreaded Securitate police), w/o American-style gun ownership.  The point is:  The populace/masses in the West have all become lazy, complacent, scared sheep.  They have all become effeminate nations, nations of "women".  Put another way, complete role reversal:  Women have become 'men' (man-like) and men have become 'women' (woman-like).

/ The gods must be laughing, or sharpening their swords for the next great culling of the human herd. /s

Wed, 11/13/2013 - 08:35 | 4149263 DeliciousSteak
DeliciousSteak's picture

Greece and Spain are democracies. It is the best way to tame a population. In Greece, controlled "nazi" opposition Golden Dawn and "commie" Syriza, combined with relentless propaganda about Nazi and Commie horrors, makes the people to have an instant psychological reaction against the very possibility of extremist government. They will accept the outcome of their voting rather than cause a civil war. And it is good.

Wed, 11/13/2013 - 09:00 | 4149295 Debugas
Debugas's picture

Tyler could add to this one more chart - how much households' expenditures were greater than income:

( (expenditures / income - 1 )*100%) back in 1930ies and now


this is just to compare which of the two crisis is going to be deeper

Wed, 11/13/2013 - 10:24 | 4149437 IlluminatiSlaveDog
IlluminatiSlaveDog's picture

Who tends the nuclear reactors while push comes to shove?  There are at 23 GE "we bring good things to life" Mark 5 boiling water nuclear reactors in 13 US states, identical to the Fukushima 4 in disaster mode. There are a total of 104 nuclear reactors in 31 states around the country.  We don't even need nuclear war to to have a nuclear disaster.  Everyone running off to go hide out in the countryside at the same time including the technicians keeping these things cooled.  How long will it take before those thing start smoldering.  This is what we have to look forward to in seven years if war is inevitable. There will not be a winner of the next war, including a civil war to bring down the ruling class.  The choice comes down to being a living debt slave or a dead debt slave.  It's not even a matter of mutually assured distruction from MIRVED nuclear missiles at this point.  A conventional grass roots confilct has the same net result.  Don't wish for something that you haven't thought through. It's like having a really big stick to keep the status quo. We have been checkmated so many time that the game isn't even with playing any more.  Are you better off existing within the current asylum knowing what to expect, how to live within it and what your place is or replacing that with conflict that has an outcome that is somewhat predictable but not known?  

Wed, 11/13/2013 - 10:13 | 4149558 falak pema
falak pema's picture

calling Orly : your prediction of deflation meme is coming true; at least for Eurozone.

No growth and so assets will be under pressure, as in a deflationary environment we are over valued at current levels, given that banks borrow at zero NOT to lend to real economy but to play on financial casino economy and inspite of shale talk marginal oil will stay above 100$ in a recessionary environment fed on Chindia demand...

Wed, 11/13/2013 - 12:21 | 4150103 ivars
ivars's picture

Wonderful!! So true..


Some may worry about coming stock collapse. Or be happy about it- see we said so.


The truth though is that the war is on already and will smoothly move into WWIII with the USA playing Germany this time.

On a nastier note, as weapons of Financial WMD are already in use , the obvious conclusion ( a foregone after events in Syria ) is that in coming wars which may start as early as February next year to gather speed as debt ceiling war moves into overdrive- that WMD will be used in this war without much hesitation.

One would think that WWIII started with Iraq and Afganistan after Sept 11- while this is not untrue, it was really and effort to prevent war. The real and long planned war started with Arab spring. Did removal of Hussein play role in that- if it did, then opposite side made its move first, and that was a mistake, though it might have looked at that time that removal of Hussein benefits Israel and Saudi. Well it did not. Arab spring is a full scale offensive against current rulers of Israel, and , as great wars should, quietly but assuredly more and more countries get sucked in.

Russia, Egypt, Iran, Saudi, USA, UK, France , Turkey are just frontrunners, with the USA being the obvious lead agressor- but the real intentions only became visible with Arab spring.

We will later read-if still alive- about operation code named "Arab spring" in annals of military strategy. 

Things do rhyme when turned around:

Operation Spring of Youth




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