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The IMF Reports: "Debt Is Good"

Tyler Durden's picture


Submitted by Simon Black via Sovereign Man blog,

Probably every kid in the world has at some point dreamed of having a time machine and being able to travel back to the past… usually to see dinosaurs or something like that.

Time travel is an almost universal fantasy. And if I could snap my fingers and turn the pages of time, I’d be seriously curious to check out the thousand-year period between the decline of the Western Roman Empire and the rise of the Renaissance.

They used to refer to this period as ‘the Dark Ages’ (though historians have since given up that moniker), a time when the entire European continent was practically at an intellectual standstill.

The Church became THE authority on everything– Science. Technology. Medicine. Education. And they kept the most vital information out of the hands of the people… instead simply telling everyone what to believe.

People living in that time had to trust that the high priests were smart guys and knew what they were talking about.

Interpreting facts and observations for yourself was heresy, and anyone who formed original thought and challenged the authority of church and state was burned at the stake.

Granted, human civilization has come a long way since then. But the basic building blocks are not terribly different than before.

Anyone who challenges the state is still burned at the stake. And our entire monetary system requires that we all trust the high priests of central banking and economics. Those that stray from the state’s message and spread economic heresy are cast down and vilified.

You may recall the case of Harvard professors Ken Rogoff and Carmen Reinhart who wrote the seminal work: “This Time is Different: Eight Centuries of Financial Folly”.

The book highlighted dozens of shocking historical patterns where once powerful nations accumulated too much debt and entered into terminal decline.

Spain, for example, defaulted on its debt six times between 1500 and 1800, then another seven times in the 19th century alone.

France defaulted on its debt EIGHT times between 1500 and 1800, including on the eve of the French Revolution in 1788. And Greece has defaulted five times since 1800.

The premise of their book was very simple: debt is bad. And when nations rack up too much of it, they get into serious trouble.

This message was not terribly convenient for governments that have racked up unprecedented levels of debt. So critics found some calculation errors in their Excel formulas, and the two professors were very publicly discredited.

Afterwards, it was as if the entire idea of debt being bad simply vanished.

Not to worry, though, the IMF has now stepped up with a work of its own to fill the void.

And surprise, surprise, their new paper “[does] not identify any clear debt threshold above which medium-term growth prospects are dramatically compromised.”

Translation: Keep racking up that debt, boys and girls, it’s nothing but smooth sailing ahead.

But that’s not all. They go much further, suggesting that once a nation reaches VERY HIGH levels of debt, there is even LESS of a correlation between debt and growth.

Clearly this is the problem for Europe and the US: $17 trillion? Pish posh. The economy will really be on fire once the debt hits $20 trillion.

There’s just one minor caveat. The IMF admits that they had to invent a completely different method to arrive to their conclusions, and that “caution should be used in the interpretation of our empirical results.”

But such details are not important.

What is important is that the economic high priests have proven once and for all that there are absolutely no consequences for countries who are deeply in debt.

And rather than pontificate what these people are smoking, we should all fall in line with unquestionable belief and devotion to their supreme wisdom.


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Tue, 02/18/2014 - 16:42 | 4449547 FieldingMellish
FieldingMellish's picture

Freedom is slavery.

Tue, 02/18/2014 - 16:53 | 4449596 zaphod
zaphod's picture

War is peace

Tue, 02/18/2014 - 17:07 | 4449656 SMG
SMG's picture

And that is why the Devil is called "the Father of Lies"

Tue, 02/18/2014 - 17:40 | 4449814 Radical Marijuana
Radical Marijuana's picture

Energy is Spirit.

Entropy is Satan.

That is why an arbitrary minus sign was inserted into the basic entropy equations in thermodynamics and information theory, since "the Father of Lies" was able to dominate the social development of philosophy of science.

To look further back in history, "War was the Father and King of all." Since success in warfare was based on backing up deceits with destruction, civilization developed from the Father of War to the Father of Lies. There are level after level of fractal paradoxes to be discovered in those processes. There are NO fundamental dichotomies, and asserting false fundamental dichotomies are the greatest of all the lies.

Paradoxically, every system of understanding that asserts and promotes its absolute "Truths" tends to be lying more the more that it does that. Ideals based on false fundamental dichotomies are necessarily impossible, and therefore result in causing the opposite to happen in the real world.

A more scientific society should be based on the axioms that the only things that really exist are different systems of organized lies, operating organized robberies, and the only ways to perhaps make that be better is to develop better dynamic equilibria between those systems. However, the degree to which the dominant systems promote their false fundamental dichotomies, and related impossible ideals, is also the degree to which negotiating better balances becomes practically impossible.

There again, the history of warfare drove those fighting to become the most fanatical, and therefore, the world is now dominated by the biggest organized crime gangs, which can not negotiate better compromises amongst themselves, because they are internally dominated by the most criminally insane people, who are who they are due the selection pressures of history picking those who were the best at being dishonest, and backing that up with violence, to become the ruling classes of their own systems.

Ponerology is the most paradoxical of sciences, because it is the study of military ethics, which is the most paradoxical aspect of militarism, which is the supreme ideology, which operates through infinite tunnels of deceits.

Tue, 02/18/2014 - 17:52 | 4449866 LawsofPhysics
LawsofPhysics's picture

Don't overthink this, be happy, because that which cannot be sustained, won't be, regardless of what any species "thinks" or "believes".

Tue, 02/18/2014 - 18:08 | 4449942 fonestar
fonestar's picture

Does anyone else remember voting for the IMF?

Tue, 02/18/2014 - 18:33 | 4450041 zaphod
zaphod's picture

People voted for the IMF the same way european serfs voted for the EU.

Example: The UK never voted to be in the EU. The last time there was a referendum they voted to form a 6-country trade agreement, that was it. They never voted for the 20+ countries of today or anything beyond a simple trade arrangement. Now the EU rules over all important decisions from immigration to welfare. 

Tue, 02/18/2014 - 18:41 | 4450064 whatthecurtains
whatthecurtains's picture

We need more Nigel Farage.

Tue, 02/18/2014 - 19:31 | 4450232 Herd Redirectio...
Herd Redirection Committee's picture

+1 for ponerology!

Tue, 02/18/2014 - 21:51 | 4450914 Reckonball
Reckonball's picture

I do!...I'm pretty sure,they were on the same ballot as the electoral college canididates..

Tue, 02/18/2014 - 17:58 | 4449895 Ying-Yang
Ying-Yang's picture

"My fate is to live among varied and confusing storms. But for you perhaps, if as I hope and wish you will live long after me, there will follow a better age. This sleep of forgetfulness will not last for ever. When the darkness has been dispersed, our descendants can come again in the former pure radiance."

Petrarch 1340 - Describing the Dark Ages

Sat, 02/22/2014 - 08:36 | 4464689 Blistering Barnacles
Tue, 02/18/2014 - 18:16 | 4449975 lasvegaspersona
lasvegaspersona's picture

' pontificate what they're smoking'...huh?..mine English not understand

Tue, 02/18/2014 - 23:01 | 4451170 Radical Marijuana
Radical Marijuana's picture

"And rather than pontificate what these people are smoking, we should all fall in line with unquestionable belief and devotion to their supreme wisdom."

If you are seriously asking, lasvegaspersona, the English idiomatic expression in the last sentence of that article above refers to the presumption that someone who is saying such silly things must be on drugs, in particular they are dopy from having smoked dope. The standard prejudice is that people are silly after they smoke marijuana, and therefore, what they say does not make sense, but rather is goofy nonsense because they are "stoned" or "high."

To pontificate about what the IMF are smoking would be to run out the stock phrases about how they must be stoned, due to whatever they were smoking, in order to spout such utter nonsense, in their reports.

So Simon Black is saying that rather that the readers of the IMF report wondering about what the IMF authors were smoking, in order to be so stoned as to spout such nonsense in that IMF report, the IMF is presuming that we are all supposed to take the IMF views as gospel truth, since it issues from such an authority in the globalized State Religion system as the IMF.

Simon Black is playing a cute turn of phrase, by using the word "pontificate," which is associated with the utterances of the authority of the Catholic Church, associated with asking what the IMF authors are smoking, in the sense of saying their report is silly nonsense, like a stoned person would say, and then flipping that back through Black's theme that the IMF operates as if they were the High Priets of the State Money System Religion.

Wed, 02/19/2014 - 09:20 | 4451976 tip e. canoe
tip e. canoe's picture

Simon Black is playing a cute turn of phrase, by using the word "pontificate,"

speaking of cute turns of phrases:

"Marihuana or Marijuana" appears to be the Spanish name for Maria and Juana (Mary and Jane). A derogatory "buzz" word used to stigmatize minority cannabis users and jazz musicians. Especially Mexicans. After Hearst Publications lost hundreds of acres of forest to Mexico. Hearst started smearing Mexicans. Mary Jane was supposedly Randolph Hearst arch enemy Poncho Villa's "prostitute, girl friend or some have said she "serviced Poncho and his men".

The constant reference in headlines of yellow journalism. This marihuana would make the lily white daughters of South Western state citizens become as loose as Poncho's whore "Mary Jane". It not only stigmatized the Mexicans and sided with the isolationists fearful of Mexicans crossing the border, stealing jobs. It kept the word cannabis and hemp from the stories. Lumping them all into one convenient item to prohibit.

With the discovery of an easier method of extracting fiber from hemp it also aided corporations in keeping competition off the market, ie; Dupont, Monsanto, Rockefeller Oil, and the Pharmaceuticals and newly legal Booze Mfg. Conspiracy or Coincidence? Regardless it worked and now we are re-discovering the medicinal and food, fuel and fiber properties of cannabis. Still fighting the same yellow journalists and government propagandist.

just a thought...

Fri, 02/21/2014 - 02:44 | 4461036 Radical Marijuana
Radical Marijuana's picture

Yeah, the "Marijuana Party" was aware of that history when it decided to register officially under that name. The word "pot" was also derived from Mexican Spanish slang. In many ways, the words "Radical Marijuana" are analogous to "Crazy Nigga."


More miscallaneous links to History of Prohibition

Tue, 02/18/2014 - 16:53 | 4449597 Divided States ...
Divided States of America's picture

Yeah and robbing our future generations is also good too right??....except our future generations have their ears plugged with the current mindless meaningless trash music and only worried about when the newest Iphone or Ipad is coming out.

Tue, 02/18/2014 - 17:07 | 4449651 NOTaREALmerican
NOTaREALmerican's picture

Re:  except our future generations have their ears plugged with the current mindless meaningless trash music

Unlike the past generations which had brilliant music, like:  The Horse with No Name.    It's good to be out of the rain is so lame.   But the rain caused a slow down in economic activity so he couldn't remember his name.

Tue, 02/18/2014 - 16:54 | 4449598 zaphod
zaphod's picture

Ignorance is Strength

Tue, 02/18/2014 - 17:14 | 4449690 Jumbotron
Jumbotron's picture

Alchemy and perpetual motion.

Oh yeah......that's a sure fire winner of a combination.  Nothing can go wrong there.

Tue, 02/18/2014 - 16:43 | 4449551 The Limerick King
The Limerick King's picture



The world is addicted to debt

The most dangerous drug you can get

The patient will die

By removing the high

Is that any reason to fret?

Tue, 02/18/2014 - 16:50 | 4449581 The Limerick King
The Limerick King's picture

Which gutless pansy junked me??? State your case moron!

Tue, 02/18/2014 - 16:53 | 4449595 Dr. Richard Head
Dr. Richard Head's picture

I didn't but that Crocodile drug is a wee bit more dangerous.

Tue, 02/18/2014 - 16:59 | 4449631 The Limerick King
The Limerick King's picture

Not even close! How many is Crocodile going to kill???

Tue, 02/18/2014 - 16:53 | 4449601 Skateboarder
Skateboarder's picture

He was either a paid shill, colorblind, or up to his neck in credit card debt.

Tue, 02/18/2014 - 17:00 | 4449637 redpill
redpill's picture

I think it was Christine "everyone should pay a shitload of taxes to bailout banks even though I don't pay a dime out of my IMF cartel salary" Lagarde

Tue, 02/18/2014 - 16:58 | 4449623 CrashisOptimistic
CrashisOptimistic's picture

I didn't, until you whined.

Tue, 02/18/2014 - 17:10 | 4449671 kito
kito's picture

wow the King cant handle the discontent in his perceived kingdom!!

Tue, 02/18/2014 - 17:13 | 4449687 The Limerick King
The Limerick King's picture

I should have expected that...  ;-)

Tue, 02/18/2014 - 16:59 | 4449630 fonzannoon
fonzannoon's picture

I junked you for jumping on the china/treasury thread with this worthless post

The Limerick King
Vote up!

1 Vote down!


Holy shit...when did all these status-quo Klepto shills start organizing their asinine posts...complete with green arrows???


You added nothing to a legitimate conversation that people were having. All you did was go on some random ad hominem attack and try to make people asking legitimate questions look bad. It was beneath you.

Other than that, love your work.

Tue, 02/18/2014 - 17:07 | 4449654 Divided States ...
Divided States of America's picture

fonzy junking ppl??? haha...i never expected that!...btw, where the fuck is kito? havent seen that guy in ages.

Tue, 02/18/2014 - 18:20 | 4449990 lasvegaspersona
lasvegaspersona's picture

I junked you because I'm confused about who was junking who and why....and you were the closest red arrow...

Tue, 02/18/2014 - 18:29 | 4450022 Divided States ...
Divided States of America's picture

Yeah thats fine, I am probably one of the biggest recipients of junk on ZH...aside from that fonestar guy and the siamese twins VD and flakes. Anyhow I dont know why you guys are fighting and junking each other over this when technically we are all on the same side....I mean stop fighting over something trivial (China dumping treasury) when we know damn well that the data reported may all be misleading lies anyways...No point of arguing especially when the boat we are all on is slowing sinking.

I never knew Limmerick King is one of the Tylers...but his rhymes are pretty good imho.

Tue, 02/18/2014 - 17:08 | 4449665 kito
kito's picture

holy crap! its a status quo shill conspiracy against the tyler shill, replete with the ability to print red arrows!!! 

Tue, 02/18/2014 - 17:09 | 4449667 The Limerick King
The Limerick King's picture

I was speaking to your ridiculous assertion that there is a legitimate treasury market out there...delusional! Between the US, Japan, BoE, China, and the supporting cast of TBTF banks, they've printed/created tens of trillions in new debt-fiat...if you think much of that flowing into treasuries through back-doors means there is a real demand for that worthless're sadly mistaken.  

Tue, 02/18/2014 - 17:16 | 4449699 fonzannoon
fonzannoon's picture

my posts had more to do with ZH's assertion that foreigners are dumping treasuries, which that report clearly illustrated was not happening. That's not the point's too bad you could not have just just posted this reply instead of taking the route you did. Then you get all pissed off when someone junks you.


Tue, 02/18/2014 - 17:23 | 4449722 The Limerick King
The Limerick King's picture

I'm not pissed off...just having a bit of fun in the fight club comments section...which I've missed.

I seem to recall it being about CHINA dumping treasuries...which they did...and if they keep doing it is a bit of a problem...don't ya think?

Tue, 02/18/2014 - 17:25 | 4449751 fonzannoon
fonzannoon's picture

define "dumping". go look at the chart of china's treasury holdings and tell me which way it's going.

and happy to help. this place needs more fight club. But attacking the messenger is bush league. I did not expect that from you.

Tue, 02/18/2014 - 17:35 | 4449791 The Limerick King
The Limerick King's picture

It's your message that's the problem. I was also reading a lot of disrespect from you on other posts...therefore expect none in return. It's never bush league to call out an apparent shill for the criminal fuckers who hate this site. If they were here...they would be saying and acting just like you. 

Tue, 02/18/2014 - 17:47 | 4449846 fonzannoon
fonzannoon's picture

"An apparent shill for the criminal fuckers who hate this site". Nice. All you can muster up on  the actual subject is that "the message is the problem". Outside of that all you can do is go ad hominem.

One could sit here and say that you are just a retarded guard dog for Tyler who can only rhyme and insult to people, because it appears that is all you are really capable of.

Tue, 02/18/2014 - 17:51 | 4449861 kito
kito's picture

limerick is full of prose and poetry, but not much else. he continues to duck the question, what constitutes "dumping"? chinas holdings have barely moved. period. fact. 

Tue, 02/18/2014 - 18:07 | 4449936 Meat Hammer
Meat Hammer's picture

I thank you fonz and kito for upsetting the apple cart.  I, too, bark into the echo chamber and rarely challenge the Tylers. Sometimes one needs a blast of cold water in the face to make sure all the senses are awake.

Tue, 02/18/2014 - 18:14 | 4449967 The Limerick King
The Limerick King's picture

They're just a couple of Krugman's trolls...

Tue, 02/18/2014 - 18:19 | 4449978 fonzannoon
fonzannoon's picture

That's all you got man eh? Wow that is weak.



The limerick king is a shmuck. who rhymes from his old pick up truck. he thinks tyler's cool. he years for his stool. and fonzannoon don't give a fuck
Tue, 02/18/2014 - 18:20 | 4449993 Meat Hammer
Meat Hammer's picture

That was beautiful, man.

Tue, 02/18/2014 - 18:23 | 4450005 kito
kito's picture

wow fonz! you can rhyme and maintain critical thinking skills!!! more than we can say for the King. 

Tue, 02/18/2014 - 18:41 | 4450067 The Limerick King
The Limerick King's picture



Fonzi & Kito are shills

Handing out Krugman's blue pills

They act as a team

It's part of their scheme

But logic ain't one of their skills

Tue, 02/18/2014 - 18:48 | 4450079 fonzannoon
fonzannoon's picture

sorry to see you are an empty can when it comes to substance. Good luck with your style. It's average at best.

Tue, 02/18/2014 - 18:54 | 4450104 The Limerick King
The Limerick King's picture

If you ever stop talking nonsense by insinuating there's nothing wrong with a totally manipulated treasury market...and wish to discuss something sensible...let me know.

Tue, 02/18/2014 - 19:07 | 4450136 fonzannoon
fonzannoon's picture

Tell me when I said there is nothing wrong with it? Tell me where I "insinuated" that. Tell me where I was "disrespectful". Yes I am pointing out that ZH analysis seems to be incorrect. I am bringing stuff up in an attempt to hash it all out. I am also pointing out that ZH seems to be going in the unfortunate direction of Michael Snyder crap articles, and others like it. Sorry if that is disrespectful, but it's reality.

You are another one who can't understand the difference between pointing something out and endorsing it. It's amazing. Lucky for you my real passion is my hobby, I will continue to work with you and maybe you will end up coming around.

Tue, 02/18/2014 - 19:15 | 4450167 Skateboarder
Skateboarder's picture

Regarding the Snyder articles, this is what happened. Snyder used to source ZH for all of his links before the Tyler change. After the Tyler change, Snyder because a source for ZH. One would guess that Snyder still links to ZH for a good amount of his data. So now you have a watered down Snyderian link cycle.

Tue, 02/18/2014 - 19:30 | 4450227 The Limerick King
The Limerick King's picture

What was incorrect...that China sold treasuries last month, and Belgium picked-up the slack? Was that an incorrect observation worthy of trouncing? Forget Tyler's narrative, I know it well...what's your narrative? Is your narrative that there is nothing to worry about...that the status-quo is fine...and that ZH is just doom porn??? If so...I know that narrative very well also...I hear it from MSM shills and status-quo morons everyday on twitter! So what is your narrative?

Tue, 02/18/2014 - 19:36 | 4450252 Herd Redirectio...
Herd Redirection Committee's picture

Fonz is in the "if you can't beat 'em, join 'em" camp, and he also believes, I'd wager, in "making hay while the sun shines", "don't fight the Fed", and "being early is the same as being wrong".

Some people are stackers, some are traders.  But personally, I am not a fan of defeatism.

Tue, 02/18/2014 - 19:43 | 4450273 fonzannoon
fonzannoon's picture

So first, your narrative is now that China sold treasuries last month....not China is dumping treasuries? Apology accepted.

Secondly, where did I insinuate I am okay with all this? Do you want to retract that before we move forward as well?

Thirdly, where was I disrespectful? Ah nevermind...

Here are a few tidbits from the post you attacked but apparently did not bother to read.

Foreign CB Treasury holdings went up by $78bil in that one month, and November's increase of $62bil was already huge...

-Highest ever recorded foreign CB Treasury holdings at just under $5.8 total

"One of the big underlying theories out there is that the world is divesting itself of Treasuries. If you read the headline of this article you would think that is happening. The guts of the report (Belgium aside) indicates otherwise. That's all I am saying."


which leads to the possibilities that.....The fed can actually exit QE4eva (ZH debunked). It's stock, not flow (ZH debunked). The fed can exit treasury purchases and not lose the long end of the bond market (Schiff debunked).

Notice I said "possibility". I did not assert it. I did not endorse it. I just pointed out that it looks like they may actually pull it off. I was just asking fucking questions and seeing what people thought.

That is my evil mastermind narrative.

Tue, 02/18/2014 - 20:04 | 4450380 The Limerick King
The Limerick King's picture

So your narrative is to "debunk" I suspected. You seem to be confused about who the bad guys are! The owners and supporters of all the debt/fiat are the bad guys...and you seem to be one of their supporters based on your statements. These "possibilities" of yours do nothing but support the status-quo narrative...the same status-quo that continues to print money in order to support Elite risk asset values and burden the masses with debts that can never be the flow of debt must increase exponentiallly or the ponzi collapses. 

If this can't go on forever...which it can't...better to deal with it in the present by the greedy fuckers who blew it up, than pass an even bigger problem on to the next generation. Do you have children and/or grandchildren, or don't you give a fuck as long as you're profiting?


Tue, 02/18/2014 - 20:15 | 4450437 fonzannoon
fonzannoon's picture

I'm confused who the bad guys are....

I seem to be on of their supporters.....

these possibilities do nothing but support the status quo narrative...

I'm profiting....

I'm disrespectful...

I'm insinuating....

All you do is throw shit at the wall. Amazing man, it's really hard to keep people on subject.

Let me clue you in on something. I have a family, as do a shit ton of people on here. My job, my only job is to provide for them. That means I have to look at the world as it is, and not how I wish it could be. I buy gold, I own guns, I don't vote. I spend every conversation with the people outside this site echoing the truths we all know on here. But since that is about as much change as I can enact, I have to figure out how to navigate the casino as best I can. Tyler spends plenty of time writing about the grand casino that are the markets, so I am just banging around some ideas and trying to figure out approximately how much time we have left before the big cracks start showing up. I also am trying to figure out if ZH's analysis is....GASP.....incorrect. Because it just might be.


Tue, 02/18/2014 - 20:43 | 4450567 The Limerick King
The Limerick King's picture


Tue, 02/18/2014 - 20:47 | 4450610 fonzannoon
fonzannoon's picture

"If you are trying to "debunk" Tyler, then that is what you are doing...because debunking Tyler is their narrative."

That's all you got. Anyone who dare questions Tyler's narrative is an MSM shill. 

I truly can't believe how mentally shallow you are. It's fascinating. Great with rhymes, yet so simple. Don't worry about who I claim to be. You have a lot bigger problems.


Wed, 02/19/2014 - 07:04 | 4451778 The Limerick King
The Limerick King's picture

No...a potential shill...time will tell.

Wed, 02/19/2014 - 07:17 | 4451781 fonzannoon
fonzannoon's picture

I don't always talk to the limerick king, but when i do, i waste my time. stay simple my friend.

Tue, 02/18/2014 - 21:19 | 4450763 Greenskeeper_Carl
Greenskeeper_Carl's picture

i hear ya. this really escalated quickly. And i think there is still a lot of time before any big cracks appear, but this stuff does come off as doom porn. Not that it won't come unglued eventually, but i dont see why you are catching so much shit from this guy just for sugesting that it might not be imploding tomorrow, and that amount isnt really 'dumping'

Tue, 02/18/2014 - 18:20 | 4449996 kito
kito's picture

haha---limerick are you austistic? are you able to pump out rhymes mindlessly but unable to read and comprehend? 

Tue, 02/18/2014 - 18:25 | 4450011 kito
kito's picture

still waiting for what constitutes "dumping" u.s. paper......

Tue, 02/18/2014 - 18:30 | 4450034 Meat Hammer
Meat Hammer's picture

kito, this was the line that raised an eyebrow for me and made me think ZH is turning into more and more of doomporn clickbait and less financial analysis: China offloaded some $48 billion in paper, bringing its total to only $1268.9 billion, down from $1316.7 billion.

That's like saying reducing your smoking to 4 cartons a day is almost quitting.

Tue, 02/18/2014 - 18:39 | 4450058 kito
kito's picture

egggactly. and Limerick just regurgitates the drivel without offering any insight. he alleges there is a "dumping" going on!! where?!?!?!? we have all been led to believe that u.s. paper is going out of style like  80's parachute pants, but there is no evidence to support it. none. and Limerick would rather blindly defend the zh status quo than accept that tylers narrative has been wrong. 

Tue, 02/18/2014 - 18:20 | 4449971 fonzannoon
fonzannoon's picture

thanks (meathammer) for keeping open the possibility that I am just a dude asking questions and not the face of a evil criminal enterprise here to do their bidding.

Tue, 02/18/2014 - 17:30 | 4449760 RafterManFMJ
RafterManFMJ's picture

The Limerick King was fraught
He saw a red arrow as a shot
He over reacted
And then he retracted
And said a green is like a red, but it's not.

Tue, 02/18/2014 - 16:46 | 4449561 LawsofPhysics
LawsofPhysics's picture

One has to wonder if th term collateral is about to be removed from all languages...

War is Peace

Ignorance is Strength

Freedom is Slavery

(and behind the scenes, Knowledge is Power)

Tue, 02/18/2014 - 17:03 | 4449604 BLOTTO
BLOTTO's picture

If i may add...

And the more knowledge given away (acquired) - the more 'they' become powerless

Tue, 02/18/2014 - 17:11 | 4449678 denverdolomte
denverdolomte's picture

For most of my 20's, I was told I didn't have the education, knowledge, what have you's. So I read as much as I possibly could and still can, these same folks that always told me how underqualified and uneducated I was for things can't even hold logical conversations with me about anything from economics, world affairs, history, physics, anything really. Sad seeing knowledge looked down upon. 


100% agree this is the path to make them powerless. 

Tue, 02/18/2014 - 17:29 | 4449768 centerline
centerline's picture

Is why the internet is a potential game changer this time around in history.

Tue, 02/18/2014 - 16:57 | 4449620 Greenskeeper_Carl
Greenskeeper_Carl's picture

these people really are shameless. But, they are essentially betting that by and large, the people of the world, especaily in US and europe, the people are too fucking stupid to figure out what is being done to them. And by large, they are correct. They couldnt have gotten away with it for this long if that wasnt the case

Tue, 02/18/2014 - 17:07 | 4449657 Tinky
Tinky's picture

Funny that you should mention the other "c" word, as I've been pondering it recently. It really represents the essence of why the system is certain to collapse, and why, when the free-fall stage of the collapse commences, gold (and certain other hard assets) will be in such tremendous demand.

Good collateral will once again take center stage, and the folly of the current system of smoke, mirrors and lies will be exposed.

Tue, 02/18/2014 - 17:10 | 4449669 0b1knob
0b1knob's picture

collateral - debt or cash which the government hasn't gotten around to confiscating yet.   GM bonds?  FNM preferred?   Bank accounts?  IRA?

They all belong to the FED now.

Tue, 02/18/2014 - 17:17 | 4449707 Kirk2NCC1701
Kirk2NCC1701's picture

And he/they does/do not share Knowledge with just 'anyone'.

You're In or you're Out.  It's a small Club, and we aren't in it.

Tue, 02/18/2014 - 16:47 | 4449573 NoTTD
NoTTD's picture

Gold is the money of Kings, Silver the money of gentlemen...


...and debt the money of slaves.

Tue, 02/18/2014 - 18:25 | 4450012 lasvegaspersona
lasvegaspersona's picture


that old saying will one day cost you your wealth...and all those who up arrowed and only gold is THE monetary metal...that is a fact. Silver was abandoned in 1935 (China was the last) and for good reason.

You will do just fine with a small amount of gold. A large amount of silver (of equal value) will only bring tears.

Tue, 02/18/2014 - 19:04 | 4450139 RaceToTheBottom
RaceToTheBottom's picture

Why tears?

Transportability ?  Confiscability?

Tue, 02/18/2014 - 19:39 | 4450256 Herd Redirectio...
Herd Redirection Committee's picture

Worse comes to worse, you will have some very nice plates and cutlery, if the price of silver tanks.

With gold, you are 'stuck' with beautiful jewellry.  No, I'm not 'into' jewellry, but just about every female on this planet very much is...  Thats where its value truly originates.

Tue, 02/18/2014 - 16:58 | 4449578 JustObserving
JustObserving's picture

So US debt and unfunded liabilities increasing by $7.9 trillion a year is a plus per the IMF.  Maybe we should spend $2 trillion a year on the military instead of just $1 trillion a year - the situation in Ukraine demands it. Putin must be stopped at any cost.

Liability per taxpayer is only $1,260,000 today.

Tue, 02/18/2014 - 16:52 | 4449592 geotrader
geotrader's picture

What's good is bad and vice-versa.

Tue, 02/18/2014 - 16:55 | 4449599 The_Ungrateful_Yid
The_Ungrateful_Yid's picture


Tue, 02/18/2014 - 16:53 | 4449602 ebworthen
ebworthen's picture

Great news.

Must be time to max out the credit card.

Tue, 02/18/2014 - 17:01 | 4449640 CaptainSpaulding
CaptainSpaulding's picture


Tue, 02/18/2014 - 17:10 | 4449668 Dr. Engali
Dr. Engali's picture

Load up on PMs, ammo, and then default.

Tue, 02/18/2014 - 16:54 | 4449606 financialrealist
financialrealist's picture

someone forgot to tell Japan

Tue, 02/18/2014 - 16:55 | 4449609 NOTaREALmerican
NOTaREALmerican's picture

Greed is good,  debt is good, my socialist scam is good, the other guy's socialist scam is bad.  

Tue, 02/18/2014 - 16:55 | 4449611 nakki
nakki's picture

IMF ECB FED BOE BOJ BOC so many acronyms for ONE I repeat ONE central bank. 

Tue, 02/18/2014 - 17:14 | 4449688 Kirk2NCC1701
Kirk2NCC1701's picture

Bank of the Beast?  Branch 666?

Tue, 02/18/2014 - 16:56 | 4449614 Motorhead
Motorhead's picture

I think I'll call my credit card company and ask that they increase my debt limit, just 'cuz.

Tue, 02/18/2014 - 16:56 | 4449617 Mr Giggles
Mr Giggles's picture

I rewrote the Bible once, just to suit myself (added a few car chases.)

Return unto the imf, all that is the imf s.

Then charge them a/holes interest & tax

Tue, 02/18/2014 - 16:58 | 4449624 NOTaREALmerican
NOTaREALmerican's picture

Did you at least get around to adding a chapter on the dinosaurs this time?!?

Tue, 02/18/2014 - 17:47 | 4449852 Mr Giggles
Mr Giggles's picture

Dinosaurs like crop circles, are a cruel joke played on the learned grey beards, for the amusment

of the locals.

Tue, 02/18/2014 - 16:59 | 4449618 Dr. Engali
Dr. Engali's picture

What is so hard to understand about the fact that every penny you pay in debt service is a penny taken out of the economy? If I take a mortgage out for $100,000 at today's rates that loan costs me about $82,000. That's $82,000 that doesn't get circulated back into the eCONomy. Throw in a car payment, student loans, and credit cards at much higher rates and pretty soon I'm working just to service my debt with no extra money to spend. Any reasonably intelligent person figures out they are a debt slave and defaults, hopefully to never repeat. .gov however can't seem to cut up those credit cards and is working for the bankers.

Tue, 02/18/2014 - 17:01 | 4449639 NOTaREALmerican
NOTaREALmerican's picture

Re:  out of the economy

Taken out of the peasant economy.

Somebody is getting to spend that 82k.   

Tue, 02/18/2014 - 17:06 | 4449652 Dr. Engali
Dr. Engali's picture

A portion of it is, and a portion is leveraged. But the rentiers let the majority of it roll.

Tue, 02/18/2014 - 16:59 | 4449633 PaperBear
PaperBear's picture

The rest of that statement is 'for them'.

Tue, 02/18/2014 - 17:00 | 4449635 NOTaREALmerican
NOTaREALmerican's picture


Tue, 02/18/2014 - 17:08 | 4449658 Kirk2NCC1701
Kirk2NCC1701's picture

Did the Banksters get a new set of Tablets, Rules or Admonitions -- that retract "Neither a lender or borrower be"?

Tue, 02/18/2014 - 17:12 | 4449686 Kirk2NCC1701
Kirk2NCC1701's picture

[1] Debt = Involuntary Bonds = worship of Mammon.  Dividend payments = Slavery

[2] Love = Voluntary Bonds = worship of Jesus.  Dividend payments = Freedom

So, the Gospel of Debt has replaced the Gospel of Love?   Interesting.

Tue, 02/18/2014 - 17:44 | 4449838 kito
kito's picture

is all debt bad? debt that is utilized to purchase productive capital cant be viewed as all bad, can it? a small business that needs a loan to start its company shouldnt take on some debt, and risk? whats the alternative, a happy little fucking communist/socialist society where nobody owns anything because it would be deemed slavery to take a risk and add value to society?


you need to think through your generalizations

Tue, 02/18/2014 - 19:44 | 4450274 Herd Redirectio...
Herd Redirection Committee's picture

Its just a form of financing.  With equity, you are selling a share of future profits, with debts, you are promising repayment of principal, plus interest, (using collateral as a guarantee. 

One is variable (future profits).  One is fixed (repayment of principal and interest).  Both represent claims of ownership.

However, you can see how leverage and large interest payments can backfire.  Leverage means risk for the equity holders, but with the promise of more reward (vs the promise of dilution, if equity financing was used instead).

Wed, 02/19/2014 - 08:29 | 4451852 tip e. canoe
tip e. canoe's picture

kito, fwiw, i happen to very much appreciate your contrarian contrarianisms and find them very healthy to ponder.

the issue that you raise is worth delving into much deeper imho.   as herd mentioned, debt financing conveys a much different quality to the risk/reward equation than equity financing does, as i'm sure you realize (and alluded to).   those qualitative differences are reflected mostly in the behavior of the participants on both sides of the equation and how that behavior contributes to how the capital &/or collateral is used for productive purposes.

or to view it another way, the term "productive purposes" is defined by the nature of the financing itself.   the question one must ask is whether the current structure of debt financing (compounded interest payable prior to principal payback) is contributing to capital being utilitzed for "productive purposes" or whether the nature of the financing currently used is simply digging everyone deeper into a hole in which there is no escape outside of a few that may squiggle through the bottom to the other side.

Wed, 02/19/2014 - 08:35 | 4451873 tip e. canoe
tip e. canoe's picture

p.s. from an article on Taleb by Gladwell that TIS linked to recently:

In the book that Pallop was reading by Kahneman and Tversky, for example, there is a description of a simple experiment, where a group of people were told to imagine that they had three hundred dollars. They were then given a choice between (a) receiving another hundred dollars or (b) tossing a coin, where if they won they got two hundred dollars and if they lost they got nothing. Most of us, it turns out, prefer (a) to (b). But then Kahneman and Tversky did a second experiment. They told people to imagine that they had five hundred dollars, and then asked them if they would rather (c) give up a hundred dollars or (d) toss a coin and pay two hundred dollars if they lost and nothing at all if they won. Most of us now prefer (d) to (c). What is interesting about those four choices is that, from a probabilistic standpoint, they are identical. They all yield an expected outcome of four hundred dollars. Nonetheless, we have strong preferences among them. Why? Because we’re more willing to gamble when it comes to losses, but are risk averse when it comes to our gains. That’s why we like small daily winnings in the stock market, even if that requires that we risk losing everything in a crash.

Tue, 02/18/2014 - 17:16 | 4449698 forwardho
forwardho's picture

When I was young and asked why, I was told by my elders, because I said so.

This answer did not work for me, and my defiance cost me dearly.

Now I've grown to be an adult and I don't care for the "because I said so" answer any more now than when I was young.

What will that defiance cost me in the near future.

 Should I live in fear of my own government?


Tue, 02/18/2014 - 17:41 | 4449826 hangemhigh77
hangemhigh77's picture

I believe you should.

Tue, 02/18/2014 - 17:18 | 4449714 Radical Marijuana
Radical Marijuana's picture

Monetary system as STATE RELIGION.

Faith-based money-as-debt is actually fraud backed by force. It is the result the application of the methods of organized crime by the international banksters to take control over national governments.


That kind of DEBT is not merely "bad," it is EVIL INSANITY. The whole world is now dominated by a fundamentally fraudulent financial accounting system, which depends upon backing up legalized lies, with legalized violence, The overall result of that system of force backed frauds is that every economic decision is made in the context of deliberate ignorance towards its longer term consequences, because the reason that accounting exists is due to the application of the methods of organized crime to control civilization. The triumphant application of the methods of organized crime have resulted in almost all politicians being the banksters' puppets, whose primary job is to continue to fool the masses of muppets.

The inherent structure of that system drives debt slavery (backed by wars based on deceits) towards numbers which are debt insanities, (which will provoke death insanities.) Money is measurement back by murder, where the money has become based on the maximum frauds, because the murders were based on the maximum deceits. Due to those basic social facts, it is practically impossible to have any rational public debates regarding political policies. Rather, the only thing that we can actually do is to wait and to watch as this runaway social insanity situation automatically gets worse, faster. Furthermore, there are no good reasons to believe that things will ever get better within the foreseeable future because that is happening.

I REPEAT this quote:

Silent Weapons for Quiet Wars

"Energy is recognized as the key to all activity on earth. Natural science is the study of the sources and control of natural energy, and social science, theoretically expressed as economics, is the study of the sources and control of social energy. Both are bookkeeping systems: mathematics. Therefore, mathematics is the primary energy science. And the bookkeeper can be king if the public can be kept ignorant of the methodology of the bookkeeping. ... In this structure, credit, presented as a pure element called "currency," has the appearance of capital, but is in effect negative capital. Hence, it has the appearance of service, but is in fact, indebtedness or debt. ... if balanced in no other way, will be balanced by the negation of population (war, genocide)... They must eventually resort to war to balance the account, because war ultimately is merely the act of destroying the creditor ... War is therefore the balancing of the system by killing the true creditors (the public ...)"

Money should be a symbolic understanding of general energy systems, and money should primarily be based on energy (with matter recognized as a form of energy). However, that could not be done unless one faced one of the basic facts about energy systems, that they are controlled by their most labile components. In human terms, civilization is controlled by the people who are the best at being dishonest, and backing that up with violence. That system of staking claims, and backing those up with coercions, has driven civilization to become stark raving mad, and therefore, be headed towards self-destruction.

Since our REAL death controls were developed by the history of warfare, which enabled the War Kings to create the powers of sovereign states, whose powers were captured by the Fraud Kings, the private banks, the REAL debt controls have become systems of maximized social frauds. Since the force of governments backing up those frauds can never make them become true, governments only drive the societies in which those frauds are amplified to become more psychotically insane.

Welcome to the Bizarro Mirror World, Folks. It is guaranteed to continue to become more so in the foreseeable future. More radical truth about the political economy inside the human ecology is not allowed into our mainstream social views, therefore, no saner human ecology is possible. Rather, the de facto triumph of the banksters' fraudulence precludes understand either natural or industrial energy systems, in order to operate those as better evolutionary ecologies. The paradox of civilization is that the history of successful warfare was based upon backing up deceits with destruction, which then segued into the history of successful finance being based upon backing up frauds with force.

The overall result is a society operating in the most insane ways possible, where that insanity is armour plated against being changed to become any saner. Therefore, our fundamentally fraudulent financially accounting systems drive us through spirals of more and more insane social polarizations, and destruction of the natural world, while developing better industrial ecologies is practically impossible because our accounting systems are NOT consistent with the laws of nature, as general energy systems, EXCEPT by being the result of the ways that lies can be successfully backed up with violence, in order to become the dominant, biggest bullies' bullshit, i.e., our STATE RELIGION money system of frauds, backed by force, which, of course, denies and suppresses the actual facts about itself as much as possible.

Tue, 02/18/2014 - 17:38 | 4449807 centerline
centerline's picture

Same as it ever was.

Sad, but true.  One can only hope that technology (information) is our way out of such things.  But not until a great deal of pain is unleashed on the world.

Wish I had a "bitcoin" (was going to say nickle but realized I am behind the times) for every time I have talked to my family about how the world is accelerating into pure insanity.

Tue, 02/18/2014 - 17:49 | 4449855 Radical Marijuana
Radical Marijuana's picture

Right down the centerline!

Tue, 02/18/2014 - 19:47 | 4450290 Herd Redirectio...
Herd Redirection Committee's picture

Interesting, I never realized before that I had read Silent Weapons prior to learning accounting!  Wonder if it had a subconscious effect...

Tue, 02/18/2014 - 22:46 | 4451110 Radical Marijuana
Radical Marijuana's picture

Hah, Herd, that is like taking acid before ever smoking marijuana.

Tue, 02/18/2014 - 17:20 | 4449727 Blazed
Blazed's picture

"They used to refer to this period as ‘the Dark Ages’ (though historians have since given up that moniker), a time when the entire European continent was practically at an intellectual standstill."

They have given up that moniker because the European continent wasn't necessarily at an intellectual "standstill".

Tue, 02/18/2014 - 17:23 | 4449740 BrigstockBoy
BrigstockBoy's picture

Get the US out of the UN and the UN out of the United States. All these interconnected organizations are just wolves in sheep's clothing.

Tue, 02/18/2014 - 17:31 | 4449777 Rising Sun
Rising Sun's picture

I just fist rammed a water buffalo.


Is that good too?

Tue, 02/18/2014 - 17:39 | 4449817 hangemhigh77
hangemhigh77's picture

They back up the debt with more cops and bigger guns.  If you don't like starving and freezing in the street, STFU or smile when you say it, slave.

Tue, 02/18/2014 - 17:57 | 4449887 Randoom Thought
Randoom Thought's picture

The IMF would say that because it wants to create "dependence" with its phoney money fiat currency. Anything that creates dependence is BAD. Anything that creates independence is GOOD. End of story.... well almost. Governments create dependence ... that is their gig ... oh, and fear of course. They create fear too. Lower emotions that attract all sorts of undesirables.

Tue, 02/18/2014 - 18:22 | 4450000 Peter Pan
Peter Pan's picture

The good thing about debt is that upon your death you are effectively telling the banks to stick it up their.......

Tue, 02/18/2014 - 19:28 | 4450218 yogibear
yogibear's picture

Circle-Jerk debt. Every central bank buys each other's debt and keeps it in nebulous land, off the books.

Tue, 02/18/2014 - 22:01 | 4450962 robnume
robnume's picture

Debt is good? This is definitely ZH's WTF? article for today. Oh, and up is down, black is white and Amerika is a democracy.

Wed, 02/19/2014 - 02:32 | 4451599 jetgraphics
jetgraphics's picture

Usury is an abomination, mathematically unsustainable in a finite money token system, condemned for only 3500 years, and proscribed by all religions that I checked. Other than that, usury is fine.


Oh, and it's a capital offense, according to Ezekiel 18:13 KJV.


Makes sense that the IMF want us to embrace debt.

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