"We're All Frogs In Boiling Water" Santelli Says After Lacy Hunt Warns "This Is Far From Over"

Tyler Durden's picture

Global debt has expanded by $35 trillion since the credit crisis and as Lacy Hunt exclaims, "that's a net negative, debt is an increase in current consumption in exchange for a decline in future spending and we are not going to solve this problem by taking on more and more debt." Santelli notes that debt will actually keep growth "squashed down" and points out the low rates in Europe questioning the ability of The ECB's actions to save the economy which Hunt confirms as "longer-term rates are excellent economic indicators" and that is not a good sign for Europe.   


"This process is far from over," Hunt concludes, "rates will move irregularly lower and will remain depressed for several years."

Santelli sums up perfectly, "we're all frogs in boiling water," as we await the consequences of central planning.



Full Hoisington note below:

Hoisington Q1 2015

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Hohum's picture

What you talking about, Lacy?  Debt's been growing by leaps and bounds since 1971 or so.

Dubaibanker's picture

I am pretty sure Santelli read my frog analogy early morning and used it on TV....


Soul Glow's picture

Santelli is as close to being Tyler Durden in the MSM as it gets.

BaBaBouy's picture

"We're All Frogs In Boiling Water"

The "TALKING HEADS" All Have A Differing Way Of Saying The Same Fecking Thing: "Protect Yourselves Bitchez, BUY GOLD Asap" ...

Pladizow's picture

OK, now give us something actionable - when do we short the Bund and other Euro debt?

metastar's picture

We are more like frogs in a pressure cooker. And, anyone in Boston can tell you what happens to pressure cookers.

There's going to be frog parts everywhere!

Manthong's picture

Frogs are way too smart to allow themselves to be slowly boiled.

Only misled and clueless human lemmings allow themselves to be slowly simmered in the shit-stew of statist central banking.

Dubaibanker's picture

Fuck the frogs!

India has become the first country in the history of the world to ask every resident Indian for their foreign as well as domestic bank account information and all foreign travel with source of funds, passport number and ID card number on their annual income tax returns.

All this is effective Apr 1, 2014 i.e. retrospectively, so not much can be done for whomsoever held an overseas bank a/c previously. Even information on closed accounts has been asked for after Apr 2014. It will not affect the Non-Resident Indians, as per information provided.

All resident Indians are covered and there we have big brother snooping and eventually arresting you as well confiscating your illegally stashed money! 

foreign india bank accounts tax returns 

There are much more tighter rules on illegal (black) money yet to come this year....so stay tuned...for this developing havoc all across India tomorrow morning onwards being a much more radical move than in the US.

Democracy, anyone?


RaceToTheBottom's picture

india is undertaking the roll of lead country for managing gold....  other countries are watching.

Manthong's picture

Frogs are way too smart to allow themselves to be slowly boiled.

Only misled and clueless human lemmings allow themselves to be slowly simmered in the shit-stew of statist central banking.

The Wizard's picture

Has anyone ever been able to find the defintion of the term "income" in the Internal Revenue Code? Just think about it. The very thought of filling out a form revealing all assets to the government every year is an insult to one's intelligence in a so called liberty and freedom loving country.

kaiserhoff's picture

Frogs in boiling water would be dead.  This seems to be a perversion of an urban legend, that you can boil a live frog by turning the temperature up 2 degrees at a time, and he won't notice.  NOT TRUE.  Any frog will jump out of the pan, as soon as the water becomes uncomfortable.

Proving yet again that humans are more adaptable, but less intelligent on average, than frogs.

Beam Me Up Scotty's picture

"What you talking about, Lacy?  Debt's been growing by leaps and bounds since 1971 or so"

You mean the fact that Obama has increased the debt more (MOAR) than all the rest of the presidents before him, COMBINED??  One giant leap??

Hohum's picture


Such is the nature of exponential growth.  You forgot to talk about private debt--common mistake.  Economists don't either.

El Vaquero's picture

Yup.  Total debt in the US has only declined once since the late 60s, and the data that I was looking at didn't go back further than that.  That once resulted in TARP, the AIG bailout, QEs 1, 2 and 3, Operation Twist, etc...  It almost brought the financial system down.


As for public debt, if you go back and start tallying, it has doubled, on average, about every 8 years.  Under Reagan, it went up 284%!  As much as I dislike Clinton, it was closer to 150%, though I don't have the exact number off the top of my head.  It wasn't Clinton's doing though, and it should be stated that I very much doubt the US government was using GAAP accounting even back then.  It was simply that the economy was booming back then, and the money velocity was high enough to pay for a lot of things without tons of debt.  Basically, chances are that any 2 term president will take on more debt or close to more debt than all other presidents combined.  As you say, Hohum, exponential growth.  It is built into the monetary system, and that doubling is going to happen regardless of the president - even if parties did make a difference, which it does not. 


It's why talk of balancing the budget is nothing more than kabuki theater.  If the government were to balance the budget, it would collapse in the blink of an eye, along with the dollar.  That interest must be paid, or else!

Oldwood's picture

Are you saying that debt is a necessity, or that the expense of paying off the debt would bankrupt the world?

Beam Me Up Scotty's picture

Wasn't it during Clintons term that they stuffed the SS trust fund full of IOU's and used that money to make it look like we were in surplus?  Or did that happen before him during Bush 41?  At any rate, this is the bank giving you a mortgage on a mansion you can't afford to pay, then loaning you money to make the payments on the mortgage.   Maybe the government should issue million year bonds and send all of the debt into the future when no one is around anymore.  Wait, that might be the 10 year, or even the 5 year bond. 

El Vaquero's picture

I think that LBJ was the one that started raiding the SS trust.  I'd be surprised if it hasn't been raided by every congress/president since.

Beam Me Up Scotty's picture

Nothing left to raid.  Its nothing more than filing cabinets stuffed full of IOU's!!  LOL!!  Everyone's SSI is really nothing more than another tax contributed to the general fund.  And yet people still believe in the shittiest system on the planet.  I can't believe there isn't full on political rebellion by anyone who is younger than about age 50 right now.

El Vaquero's picture

Normalcy bias + panem et circenses.  Most people have food and a roof over their heads plus NFL, fantasy football, dancing with the stars, and other dumbass shows like mountian monsters where a bunch of hillbillies run around trying to catch a 'sheepsquatch."  (I shit you not!)  We're told that SS will be solvent until 20XX way in the future, so people think that it's not their problem.  I think that most people, even a lot of the dumber ones, know in the back of their minds that something isn't right, but they don't want to believe it and won't until they have no choice.  Afterall, why go out and risk a bullet in your ass when you have shelter, food and mind numbing entertainment?  Nothing is going to happen until at least one of those conditions changes, and when it does, liberty minded people are going to have to keep the sociopaths and control freaks from taking charge. 

Fun Facts's picture

This financial system [ponzi scheme] has been entirely broken since 2008 due to a debt we call money that is too large to ever be repaid.

Since 2008, under various euphemisms, they have been monetizing the debt, and if they stop [collectively speaking for western CB's], the system will fail [ponzi scheme will end].

They know it, everyone with a few active synapses knows it, and it's all held together now only with CB open market operations and statistical fraud.

El Vaquero's picture

Volatility is coming back, which is a sign of where the Fed's hand isn't.  I think that they're losing control or are going to lose control relatively soon.  The excess reserves held at the Fed keep on going down, then they go back up.  With QE3 ended, they should be going down and not back up.  I don't think that this is POMO in the traditional sense, but I think there is some form of open market operation.  Where are the FRNs that leave going and where are the FRNs that come back coming from?  That is the $300 billion question.  And lets not forget Belgium acting as a straw purchaser for USTs.  For who, though?  I suspect the Fed, though I cannot prove it.  Even worse, it could be something like the IMF. 


Either way, I think that POMO was well past the point of diminishing returns.  If they really want to get rid of all of this odious debt, they're going to have to do a helicopter drop, no, make that a B52 drop to the populace.  But we all know where that leads. 

roadhazard's picture

The FED is into the SS fund for $2.5 TRILLION. Yes, SS could have funded itself if it had not all been stolen.

JoWazzoo's picture

The concept of raiding SS is not well understood.  What they did was pass a bill that credited the excess flows into SS over payouts onto the budget.  Thus making the deficit look better.


Assume SS payments = 100 and payments into the "SS trust fund" = 200.  Net of + 100.

Fed revenue = 1,000 and spending = 1,100.  Deficit = 100.

By rolling the SS excess into the budget ... voila - deficit becomes Zero.

Of course in coming years (20 or so) the net flow from the SS Trust fund will become negative.  Pay = 200 and payments of 100.  Don't be surprised if Congress votes to remove SS "excess" from the budget as it will be a negative, not a positive.

El Vaquero's picture

I'm saying that because debt is the mechanism through which more currency is created and because the amount of debt out there is so much greater than what we produce every year, reducing the debt load would reduce the amount of currency to the point that the debt that is left could not be repaid.  A lot of TBTF institutions would fail, and people would probably lose faith in the currency, i.e. hyperinflation would be the end result of the Fed and the government trying to stop it.  If you look at our trade deficit, and realize that it is dependent on the USD's status as the global reserve currency, you have to realize that all or most of our imports would go away.  This includes imported oil to a large degree.  Ironically, a debt crisis may very well start with in the energy of the economy.  Last I saw, there were $550 billion in junk bonds tied to the energy sector.  If something tanks the price of oil, a lot of that is not getting repaid, and if it is a big enough event, it will lead to a contagion in the bond markets.  Either way, with the fed's bubble blowing policies, we've been getting a financial crisis about every 7-8 years.  We're about due for one now. 


The good news is that the USD is a pillar of the US government's and the TBTF banks' power, and if the dollar goes away, so does a lot of their BS.  The bad news is that we'll have to adjust to a lower standard of living, and I doubt that adjustment will be peaceful or smooth.  Not to mention that the US government and TBTF will do a lot of damage trying to keep an unsustainable status quo sustained.

msmith9962's picture

Thank you for your concise analysis!  Much appreciated.

Usurious's picture
Usurious (not verified) msmith9962 Apr 17, 2015 3:45 PM

El Vaquero's comments  are as close to trav7777 as you can get.......

El Vaquero's picture

I'm not trav7777.  Did he get the banhammer, or did he just quit coming around?

Usurious's picture
Usurious (not verified) El Vaquero Apr 17, 2015 4:12 PM

he was banned......its too bad, he was one smart dude.....he got a little crazy toward the end of his time here...

I enjoy your comments as much as i did reading trav7777, and as you might know, I quote trav and mako quite often.....


El Vaquero's picture

Yeah, watching the bullshit without blinders on makes you want to go crazy.  The good news is that I think we're a lot closer to the end than the beginning.  The bad news is that the transition period is going to suck.  I'm just waiting for the "We don't believe that the problems in the energy related high yield credit markets are going to spread."  High yield credit, subprime, what's the difference, right?  Or, hell, it might pop up somewhere else too. 

RaceToTheBottom's picture

Country debt is a way to have less taxes than required to balance budget.

Meremortal's picture

Instead of looking at who was President when deficits (not debt) went down, you should look at which party contolled congress, since B.O. (Before Obama) congress generated the budget every year as ordered under the Constitution.

When it comes to budgets, the President proposes, the Congress disposes. That's why we don't see budgets anymore, we see continuing resolutions.



El Vaquero's picture

Congress, party or president does not matter much.  This ship is steering itself.  Full speed ahead and damn the iceburgs!



Usurious's picture
Usurious (not verified) Meremortal Apr 17, 2015 3:48 PM

in a debt-money system, growth of the debt is required, not optional........if the public does not borrow, the govt will borrow on their behalf........

El Vaquero's picture



And when that fails, we get AIG bailouts, TARP, QE1, QE2, Operation Twist, QE3 and probably a bunch of other bullshit that was kept from the public. 

Vullsain's picture

Fuck Obama and the democrats they were a part of it. But I am tired of the GOP Ditto Heads playing Stupid and Righteous and pretending  that Obama did not inherit an absolute clusterfuck from the era of Dubya,  who spent like a drunken democrat ,  financial and housing collapse, TARP, two wars, kicking the medicare insolvency down the road with a trillion dollar unfunded medicare modernization act, and "Dick Deficits Don't Matter Cheney" and Reagan Stlyle Borrow and Spend GOP Voodoo Economics. They suck bankster cock as good or better than the democrats.


Glasater55's picture

Obummer took 780 billion out of the Medicare trust fund to implement 0-care.

Vullsain's picture

Health Care reform/economics/sustainability is incredibly complex and difficult when you get beyond the mantras and memes that replace policy discussion. maybe it has to be that way. i was at one time reasonably informed, I have not kept up like i should. But I do know if you start to look at Obamacare's components you can see the DNA of policy being discussed and planned from non partisan experts from 30 years ago. As messy as Obamacare is, doing nothing is  unsustainable, the rate of healthcare inflation along with 45 million uninsured eventually had to be addressed. It is also a subject that my libertarian leanings does not mesh very well with. We were incapable as a society of dealing with it 40 years ago when we should have, and when any basic analysis of demographics and healthcare inflation/technology predicted where we are at. 

Not My Real Name's picture

"As messy as Obamacare is, doing nothing is  unsustainable, the rate of healthcare inflation along with 45 million uninsured eventually had to be addressed."

So doing something that makes things worse is better than doing nothing? Fuck Obamacare.


Vullsain's picture

Just keep sticking your head in the sand. Better yet actually try to to read a little bit instead of regurgitating the puke you hear on FOX.

Although I never said I support Obamacare, having a conversation about healthcare economics and policy is like pissing in the wind with your mouth open,

Like I mentioned I do not keep up. It is still irritating ar times to read over and over clueless simpleton mantras.


Overfed's picture

HMOs, medical "insurance", Medicare, and Medicaide are the reasons why healthcare costs have skyrocketed over the last 50 years or so. Along with other forms of .gov interference.

Vullsain's picture

You left out point blank obvious ageing demographics, health care is very labor intensive,advanced healthcare technology actually becomes even  more labor intensive instead of less so as in other industries. One simple example, the technologist performing the MRI scan is very specialized,it goes on and on Robotics and automation is not a great fit in healthcare as it is in other industries.. we have left out pharmaceuticals, your eyes would pop out if were to read how much of the healthcare dollar would go to drugs if there is not some rationing.

Vullsain's picture

"HMOs, medical "insurance", Medicare, and Medicaide are the reasons why healthcare costs have skyrocketed over the last 50 years or so. Along with other forms of .gov interference."

Actually I agree, maybe if we had tackled the problem 40-50 years ago we could have come up with something better. But that is dreaming of some libertarian utopia.

Calmyourself's picture

Stop the illegal pricing schemes that all of Healthcare is allowed to partake of protected of course by big brother..

RaceToTheBottom's picture

Three players makes it lots harder. Single payer would have removed the need to make billionaires out of healthcare insurance banksters...

Vullsain's picture

Exactly but the ditto heads would have been screaming socialism like hysterical little bitchez even though the system before Obama was essentially socialized and heading more so every year.

Vullsain's picture

This is actually what the GOP big shots wanted, they wanted to have access to the insurers jizm in their mouths, and get to blame the democrats to boot, another cynical win win for the elephant faction of the One-Party

BTW to counter the tone of my foul mood today At least there are few if any dipshit liberals around here on ZH. I am thankful for that. Most but not all FOX news fanboys you can at least have a semblance of a rational discussion with (not always)

El Vaquero's picture

See my previous post.  At nearly $58 trillion in total debt in a country with a $17.7 trillion GDP with a fiat debt-is-money system, it doesn't take a rocket scientist to see that, if the debt starts to decrease, they will do everything they can to stop it, because that is more in the way of defaults than the USD can handle.  It would crush the dollar and goods would quit flowing to the US.  The ability to pay interest on all of that debt is going to go away, and the USD will get crushed one way or another.  We're in between a rock and a hard place with interest rates because of this.  People relying on a fixed income are getting screwed by ZIRP as is productive investment, but truly raising rates would bring the day of recokoning that much closer.  This is a no-win situation. 

USisCorrupt's picture

Vullsain you need to realize that there is ONLY a ONE PARTY system in this Country. There is NO Difference between Dem's & Rep's.


And for ALL those Yahoo's who think the handouts should STOP? Think about it when your loved one is Raped and Robbed. Or would you rather see MORE $$'s go to the WARS until the system implodes?


Why are so many so clueless?

Oldwood's picture

I'll take my chances with "raped and robbed", thank you.