Guest Post: The World Is Stuck Between A Rock And A Squishy Place

Tyler Durden's picture

Submitted by Howard Kunstler of,

The rock is reality. The squishy place is the illusion that pervasive racketeering is an okay replacement for an economy. The essence of racketeering is the use of dishonest schemes to get money, often (but not always) employing coercion to make it work. Some rackets can function on the sheer cluelessness of the victim(s).

Is it fair to suppose that money management is at the heart of the sort of advanced, complex economy that developed early in the 20th century? I think so. Money is the lifeblood of trade and of investment in productive activities that support trade. Of course, in order for money to have meaning, to function in such transactional relations, the people must be convinced that it legitimately represents its face value. Otherwise, money must be labeled “money” — that is, a medium of exchange suspected of false value. An economy that uses “money” — especially an economy of rackets — is an economy in a lot of trouble, and that is where ours is in December 2013.

The trouble reached escape velocity in the fall of 2008 when a particular brand of racket among the Wall Street kit-bag of rackets got badly out-of-hand, namely the business of selling securitized bundled mortgages and their “innovative” derivative “products” to dupes unaware that they were booby-trapped for failure which would, perversely, hugely reward the seller of such trash paper. These were, in the immortal words of Senator Carl Levin (D-Mich), the “really shitty deal[s]” propagated by the likes of the Goldman Sachs crypto-bank — so-called collateralized debt obligations — pawned off on credulous pension fund managers and other “marks” around the world greedy for “yield.”

It turned out that all the large banks trafficking in such booby-trapped contracts ended up choking on them when “the music stopped” — that is, when the derivative “swaps” payoffs at the heart of this particular racket began to fail, sending up a general alarm that all such “products” were primed to blow up the entire “banking” system. By the way, the quotation marks I so liberally resort to are necessary to denote that in such a matrix of rackets things are not what they appear to be but only what they pretend to be.

The failure of Bear Stearns followed by the implosion of Lehman Brothers and the near-death experience of AIG alerted “civilians” outside Wall Street that the banks were linked in a web of fraud and insolvency and had to be “rescued” in order for the rest of America to keep its “way of life” going. The rescue remedy proved to be several new layers of fraud that have now matured into institutionalized rackets. The best known are the Siamese twins of “Quantitative Easing” and zero interest rate policy (ZIRP). The lesser-known racket was the 2009 rule change by the Financial Accounting Standards Board that allowed banks to make up whatever numbers they felt like in reporting the value of their holdings (“assets”).

Hence, these dishonest, regularized operations can be labeled a hostage racket with coercion at their core. The coercion comes in the form of the threat that any let-up in the stream of QE “money” enjoyed by the banks in the form of carry-trade “loans” and “primary dealer” premium cream-offs will send the economy back to the stone age. Overlooked in this equation is the ongoing destruction of ordinary citizens (a.k.a. the “middle class”) who have already lost their grip on the emblematic “way of life” Wall Street is working so tirelessly to defend. Politicians are, of course, deeply implicated and indeed directly involved in all these rackets, since these hired handmaidens make and execute the laws protecting Wall Street’s looting operations.

The catch to all this, lately, lies in the cognitive dissonance between the symptomatic euphoria of record stock market indexes versus the conviction of a few hardcore skeptical observers that the rackets are now so reckless and impudent as to be beyond any hope of control and on a trajectory to bring about hardships orders of magnitude above anything imagined in 2008.

So-called “health care” is also a hostage racket, since sick people are hardly in a position to bargain for anything, but it is only a sub-system of the larger matrix of rackets that have made this such an unusually dishonest society. My guess is that ObamaCare is sure to make it worse, and pretty quickly too, since the rules for ObamaCare were written by the hireling lobbyists of the industries that benefit from the racketeering.

The big mystery in all this remains: where are the people with some institutional power who might stand up and denounce all this perfidy? What has made us such a culture of cowards and cravens that the best we can do is produce a couple of comedians who speak truth to power in the form of jokes. Most of this is not that funny.

By the way, one reason for the vulgar orgy of “consumerism” that, in recent years, has turned the Thanksgiving holiday into a sort of grotesque sporting event, is to mount a crude demonstration that our “money” is a viable medium of exchange. The dumbest people in the land are induced to swarm through the merchandise warehouse stores and fight to exchange their “money” for hard goods offered at false “bargains.” I wonder how much of it is a dress rehearsal for what happens in a hyper-inflation?

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NoDebt's picture

I asked my father probably 15 years ago "do only people who cheat succeed?"

You could tell that question hurt him.  Almost as much as his answer: "not always."  Implication: usually.

madcows's picture

integrity died when the baby boomers were born.  before that it was only on life support.

Ralph Spoilsport's picture

Care to explain how us infant boomers managed to kill integrity? If you're blaming our parents for having so many kids, I got news for ya. They're dead and don't give a fuck what you think. More jealousy from the do-nothing, bitchalot generation.

mofreedom's picture


Spitting on returning vietnam vets.



Pissin on Bob Dylan when he went electric.

Ripe odors.


BigJim's picture

 Spitting on returning vietnam vets

So... killing vast numbers of foreigners who are no threat to us is ok, is it?

 Pissin on Bob Dylan when he went electric.

Most of those reactionaries weren't boomers.

This inter-generational conflict is the ultimate blue-vs-red, divide and conquer nonsense. If your parents were shit, hate them, not their generation.

Anyway, let's have a look at some of the non-boomers.... the 'greatest geneartion', who allowed FDR to collectivise the economy... their parents the doughboys, marching off to Europe to kill foreigners... their parents who voted in Wilson, and allowed the creation of the Federal Reserve... the Civil War generation who cheerfully marched off to kill their fellow Americans to stop them seceding...

Face it. Every generation is shit.

Notarocketscientist's picture

By failing to stand up to this bullshit when there was still stopping it.

Now we are fucked.

Kinskian's picture

"integrity died when the baby boomers were born"

And your generation, typified by men wearing girls blue jeans and v-neck t-shirts gave us two terms under Obama. Thanks.

Notarocketscientist's picture

You are forgetting that the current generation was raised by baby boomers - of course they will turn out even worse.

The baby boomers are a bunch of spoiled whining bastards - and their children are brats who think they are entitled to even more.



BigJim's picture

And the boomer's parents were flag-salutin morons who voted in FDR. And their parents marched off to Europe, and their parents voted in Wilson and allowed the creation of the Federal Reserve, and their parents' parents faught  the 'Civil' War, etc, etc. Stop discriminating on the grounds of age, people are shit.

Herd Redirection Committee's picture

The moment for me was when I realized criminals propagate the lie "Crime doesn't pay" because they don't like competition.

insanelysane's picture

In 2008 the citizenry wanted to hang the banksters for destroying the economy with the credit default swindle.

In 201x the citizenry will hang the banksters and the politicians that did destroy the economy.

The ponzi may go on a while longer but it won't make it out of the decade.

RaceToTheBottom's picture

I down arrowed you not because I don't want it to happen, but because I doubt it will happen.

OldPhart's picture

I considered running for office...but realized I couldn't stand being around such people on a day to day basis.  I'd go postal.

illyia's picture

So the people who loved that smell and covered each other's ass to get it ran for office, became bankers and "statesmen" and here we are.

Where is Samuel Clemens when you need him?...

Occident Mortal's picture

The Fed will Taper, rates will rise, the deficit will grow due to the expense of servicing the debt and the Fed will have space to continue buying.

BigJim's picture

The Fed own 1/3 of the debt already. Once they own 2/3 of it rates can rise and servicing it will be a doddle because the interest gets remitted back to the Treasury.

Minus the Fed's owners' well-earned 6% 'profit' of course.

Bangin7GramRocks's picture

And these fucking frauds get to pay themselves bonuses based upon completely fake profits. What other industry can invent profits and then have the balls to compensate themselves so lavishly. It's almost as if these vampires have no morals.

NOTaREALmerican's picture

Re:  Morals imply a "soul".

It also implies limits.   And do REAL mericans even like people who accept limits?!

No,  that's why everybody gives 110%, because limits are for losers!

Cue:   I did it my way music,  slow motion Tom Landry,  and a slow motion flag.

Things that go bump's picture

Psychopaths have no morals, and they really fear nothing, at least as you would recognize fear, and so are unconstrained by the sort of concerns binding most of society. They are completely unfettered by any scruples whatsoever. What they have instead is a facade of superficial charm, an enviable facility to lie convincingly, and an innate ability and predilection for manipulation along with the absolutely remorseless willingness to trample over anything and anybody to succeed at gratification of their desires. You can recognize them by the ruin they leave in their wake as they are disasters as spouses and parents. While it is thought that they make up about 3% of the population, they are probably much more heavily represented in high positions of business and government. The smart ones run the place. The dumb ones are more heavily represented in our prison population. Another of their characteristics is the complete inability to learn from their mistakes, so we are, of course, doomed. 

Uncle Remus's picture

Wow. He didn't mention tattoos or the South.

starman's picture

Debt by design! Author Benie and the Feds!

ebworthen's picture

Great summary of the evil afoot.

"...where are the people with some institutional power who might stand up and denounce all this perfidy?"

Where indeed.

LawsofPhysics's picture

People of integrity have no power, as there hasn't been any real consequences for bad behavior for quite some time (i.e. is John Corzine in prison yet?) so there has been no mechanism in place to insure that such evil fucks are made bankrupt. Behaviors will never change unless there are real consequences, at all levels.  I believe that this is the fundamental driving force behind cryptocurrencies.  many realize that the fiat game is fixed, along with most publically traded "markets", hence, people are pulling out any assets they can and looking for other alternatives.  We are here (and may be for a while longer) --> "When fraud is the status quo, possession is the law."

TrustWho's picture

I know a filipino who was born poor; throught his energy reached top 1%. One day sitting in the office of his most successful business, cronies of President Marcos walked into his office and told him they were going to buy his company. He told them the company was not for sale. Cronies told him they would buy the business or this day would be his last. He sold the business....cheaply.

You may need fire-power to hold your possessions!

22winmag's picture

Regarding firepower, a lot of Americans are well aware why 2013 was an all time record for gun and ammo sales.


The ones who aren't will be soon.

TrustWho's picture

And many are watching the Walking Dead.

NOTaREALmerican's picture

Survival of the fittest, bitchez!!!

Spastica Rex's picture

One world grifterment.

Uncle Remus's picture



or is it kitchy. [shrug]

I am Jobe's picture

Peace on Earth Bitchezz. Soon Ration Cards, to save Server Power is coming.

Professorlocknload's picture

Look what the Fed has done to the World.

It all began with dishonest money, as usual.

Kirk2NCC1701's picture

If the world is stuck between a Squishy place and whatever rhymes with Rock, then we are really screwed.

AldoHux_IV's picture

I'd like to know what is "institutional power"?

Uncle Remus's picture

An analog might be all the pressure you feel in your lower intestine prior to, well, you know.

AldoHux_IV's picture

so... we start throwing feces at politicians?

kurt's picture

It's what stops you from telling your boss to stick it up his ass, criticising a cop who's giving you a ticket, saying something to your doctor that may get you a referral to a headshrinker, telling the headshrinker to suck your dick, stealing, murdering, acting like a banker or politician (neither of which are faced with any institutional power anymore.) Got it fuckface?

Goldilocks's picture

Epic Facepalm Compilation ULTIMATE EDITION (2:51)

[HD] Epic Facepalm (1:39)

Walmart - Black Friday Madness - Criminal Negligence Causing Death

loveyajimbo's picture

How about conservative ZH whites take the "Knockout Game" to Wall St?  What fun it would be to plant an unsuspecting fist grenade in the face of "Roid Blankfein, Flamey Jamie Dimon, Bone lover Geithner, Nutless Gensler, or the arch Shitbag Hank Paulson?  Or any of 1000 others?

Radical Marijuana's picture
Hah! I have also ended up doing that a lot too: "the quotation marks I so liberally resort to are necessary to denote that in such a matrix of rackets things are not what they appear to be but only what they pretend to be." However, I disagree that there is any "big mystery in all this." The methods of organized crime are fairly simple: bribery, intimidation and assassination of anyone significant that can not be bribed or intimidated. The "culture of cowards and cravens" is what survives living inside the systems of debt slavery, backed by wars based on deceits.

After any group in society starts to get away with fraudulent rackets, then there is an automatic runaway feedback loop. The current global systems can be traced back to the Bank of England being legally allowed to make "money" out of nothing, under what started as a 50% fractional reserve system of being allowed to make twice as much paper pounds sterling as there was actual silver. That financed a global robbery binge, which enabled it to continue to grow more fraudulent. Of course, after the Federal Reserve system took back control over the public money supply in the USA, then the die was cast for the runaway Anglo-American (Zionist) empire to become more globally dominant. WHO CAN COMPETE WITH PEOPLE THAT CAN LEGALLY MAKE MONEY OUT OF NOTHING, WHEN EVERYONE ELSE HAS TO WORK FOR THEIR MONEY? The obvious answer is nobody! There is nobody else that is in the same league of being able to bribe and intimidate, as well as pay for assassinations, as the biggest gangsters, the banksters. They were easily able to leverage their power of triumphant financial frauds up and up, as they ratcheted their rackets, to be able to take control of every social institution, by dominating its funding, such as the school systems and the mass media.

The international banksters have collectively become a group of trillionaire mass murderers. The only thing that keeps anyone safe that opposes them is that their opposition is insignificant. If anyone becomes a possible serious threat to the banksters, then they will discover that resources will be allocated to whatever degree is necessary in order to discredit or destroy them, to thus neutralize their attempts at opposing the interests of the international banksters, and the corporations that have grown up around those banksters.

After one takes enough time to learn enough about this situation, then there are no practical and realistic solutions which are politically feasible. One has to have an irrational hope in some series of political miracles to think that there are any possibly viable good solutions to these problems. Furthermore, the only genuine solutions would require better organized crimes, operating better murder systems, which theoretically would require enough citizens understanding that their country was actually an organized crime gang, being controlled by the best organized gang of criminals.

However, clearly, any such breakthrough paradigm shift to understand political science in more profound ways by enough people is not possible, given the degree to which the school systems and mass media have already been captured, etc. ... At the present time, I can no longer believe in anything than that the established systems of legalized lies, backed by legalized violence, will continue to drive themselves mad, and cause their own self-destruction, through some series of psychotic breakdowns and catastrophic collapses, which are the final failures that result from too much success at controlling civilization with runaway systems of huge lies, backed by violence.

MAYBE, if some of us survive through that madness, there might be new opportunities emerge, but I would not count on that not repeating the past patterns of history being controlled again by whomever emerges as the best at backing up lies with coercion after the current systems have destroyed themselves. The deeper problem with a privatized government based on triumphant runaway financial frauds is that that deliberately ignores the laws of nature, as well as common sense, and so, everything that civilization actually does necessarily becomes increasingly insane due to that cause. Hence, what the world will look like after the current systems go through their mad self-destruction is impossible to imagine, and may not be too favourable for any new civilization to be built on those ruins?

So far, I see no reasons to believe that enough people are going to understand what has happened enough in order to make better dynamic equilibria between the different systems of organized lies, operating organized robberies, emerge. After working on these political problems for a few decades, and while continuing to work on them now, my conclusions are that more than 99% of the public act like political idiots, which tend mostly to become more idiotic, as their circumstances automatically sink deeper into the quicksand of debt slavery. Those who think that more people than ever are "waking up" are surely right. But nevertheless, the overall statistics are dismal, and dismal squared, becoming dismal cubed.

War was always a racket, and indeed, the ultimate racket which became the foundation for everything else that Neolithic Civilizations have done. Furthermore, there are chronic political problems inherent in the nature of life which require some resolution, which explain why warfare emerged and became what it became. Upon that basis, of the historical murder systems, were later built the current money systems.

However, my basic definition that money is measurement backed by murder is a definition which one will not find written anywhere else that I am aware of. At the present time, everything that I have written above may be labeled the Fringe Cubed position, or the fringe of the fringe of the fringe of public opinions. The degree to which that view may be more radical truth, and the most consistent with all the real social facts, continues to be almost totally irrelevant to the current triumphs of the established runaway rackets, which have their foundation upon the legalized counterfeiting of the public "money" supply by private banks, which can legally make "money" out of nothing, as debts, while the government forces itself, and everyone else, to operate within that system.

Since everyone else has to work for their money, which means that they must operate within the laws of nature regarding the conservation of energy and matter, and sell services or goods in order to obtain money, while the banksters can make that money out of nothing, there is no feasible way for those who have to work for their money to politically compete with those who can legally make their money out of nothing. Given that those who already can legally make their money out of nothing have been doing that in the British Empire for a few hundred years, and in the American Empire for a hundred years, and they have pretty well been able to dominate the whole world through their force backed frauds, and given that that Anglo-American (Zionist) empire continues to be able to resort to whatever kinds of bribery, intimidation, or assassinations, of any significant opposition, in order to discredit or destroy that opposition by whatever means that are necessary and possible, OF COURSE, THE ONLY OPPOSITION IN THE PUBLIC SPACE TENDS TO BE CONTROLLED OPPOSITION inside of "a culture of cowards and cravens," in which almost all politicians are puppets for special interests, whose job as political puppets is to perform for the muppets, in order to fool enough of those muppets, enough of the time.

ONLY THAT CONTROLLED OPPOSITION, OF PROFESSIONAL LIARS AND IMMACULATE HYPOCRITES, MAY ENJOY "SUCCESSFUL" CAREERS AS POLITICIANS. The overall system is dishonest governments, corrupt courts, and ignorant citizens, which is primarily pushed around by the dishonesty of governments, which is covertly backed up by the application of the methods of organized crime to dominate the real political processes.

Therefore, I would agree that "The World Is Stuck Between A Rock And A Squishy Place." My conclusions are that the fundamentally fraudulent financial accounting system, that dominates everything our civilization does, will continue to drive social polarization, and the deterioration of the natural world, to the point of mad self-destruction. However, there is nothing which is realistically and practically possible to prevent that from happening. Therefore, the outcome of the world being stuck between a rock and a squishy place is that the majority of people are going to get squashed. The runaway debt slavery will continue to generate numbers which are debt insanity, which will cause the established systems to go through collapses into chaos, because there is nothing else within those systems to prevent themselves causing their own psychotic breakdowns. Furthermore, when the debt insanities get that bad, then there will be caused death insanities to match those phenomena.

The only credible alternatives would require enough people understanding more radical truth about the combined money/murder systems, in order to be able to breakthrough to new systems of debt controls, backed by death controls. However, like I have already outlined above, instead of better breakthroughs to more radical truths, psychotic breakdowns, into even worse social insanities, are far more probable futures.

autonomos's picture

"ignorant citizens": deep human dysfunction is the root of that global "satisfied ignorance" (this makes me think of a widespread Nash equilibrium). I explain:

There is no more political dimension in human, because the consumer dimension occupies all life. And the consumer dimension is the most efficient way for the sick "I" to feed oneself (the sick "I" persists through its relation to the self and the world).

Even when they engage in political activity, they just crave for another authority to live under (like unsatisfied kids).

In other words, there is no commitment -no political adulthood- where there is only disengagement and withdrawal.

PS: not everything in the "I" is sick. The mystical is the cure.

Radical Marijuana's picture

I agree, autonomous. I believe that there has been an excessively successful effort to deliberately reduce citizens to bullshit consumers. After one does research into the education system, there appears no way to doubt that, while, of course, the triumph of advertizing, as the scientific application of psychology in a vicious spiral to make people become more idiotic is also blatantly obvious. The profound dilemma comes from the longer term consequences of those who succeed from legalizing frauds, then reinvesting some of their profits from that frauds, in even more frauds, until the whole thing becomes runaway self-destructive feedback.  In order for a fundamentally fraudulent financial accounting system to be maintained, the majority of people have to be conditioned to become political idiots, that do not want to understand that system.

IF, IF, IF enough people were to wake up to that more, then maybe something could be done. However, meanwhile, at least the individuals who do understand may obtain some consolations from philosophy.

How Ego Comes Through The Back Door

I enjoyed how that video ran spirals around the paradoxes of relative self in ONENESS.

autonomos's picture

I watched it and see what you mean (and some youtube comments are worth ZH...). I would say the pitfall is identification (Ego as identification with the mind, when the tool uses you - she would say). Defining general human dysfunction as relation to oneself enables to explain that 80% of women are hysterical ("everything is an event"), and 80% of men obsessive ("everything makes sense"). As long as I identify with "me" can I relate to myself... in various psychological ways.

At a collective scale, the works of Solomon Asch and Stanley Milgram are decisive. I share your leaning toward politics and tried to involve :

But, as wisdom lacks of political dimension (see Tibet), people engaged in politics lack of wisdom. This undermines/dooms everything.

So I do my best to die before I die. At the end of the process one does not remain undifferentiated, but purified/uncluttered. 

Cashcollateral's picture

I am "glad" that the author is "self aware" about his rampant use of "quotation marks", but it's still "annoying as fuck" to read.