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Don't Think The Status Quo Will Save You

Tyler Durden's picture




 

Submitted by Charles Hugh-Smith of OfTwoMinds blog,

Here's a chart that shows how the Status Quo "fixes" every problem: it transfers more debt and more losses to the taxpayers.

Many hold a touchingly naive faith that the Status Quo will save them even as the current system unravels. Why is this faith naive?

Let's start with this key question: does the Status Quo strike you as being even remotely competent?

If you answer "yes," we have to ask: what planet are you on? Mars? Here on Earth, no one that isn't a bought-and-paid for-shill of the Status Quo would even make the risible claim of Status Quo competence, except as a bitter joke.

The Status Quo assumes we can't deal with the truth like adults, and so it sugar-coats every unsolvable problem with lies and false assurances. The Status Quo assumption is the Great Unwashed 90% will shoot the messenger, i.e. toss out our public leadership should they be foolish enough to tell us the truth: the promises issued to you cannot possibly be fulfilled.

Not because of an evil cabal, but because the demographics and financial realities render the promises impossible to keep, regardless of who's in office.

I'm going to get my Social Security, right? I wuz promised! Don't be a chump, man. You'll get something that's called Social Security, but it will either be taxed to the point it only buys a loaf of bread or will only be worth a loaf of bread. So yes, you'll get Social Security, but not the one you were promised or the one you're imagining.

I'm going to get my Medicare, right? I wuz promised! Sure, you are, pal. Just not the Medicare you're imagining, you know, the one that pays for everything.

The stock market will never crash, right?

Does this look like a stock market that will never crash again, or a stock market that's poised to crash again? Your answer is a measure of your gullibility and faith in the Status Quo's false assurances.

Does this chart of federal debt look remotely sustainable to you? Don't be a chump, man--it's clearly not sustainable, no matter what rationalizations the Power Elites' shills are bleating.

Here's a chart that shows how the Status Quo "fixes" every problem: it transfers more debt and more losses to the taxpayers. Student loans out of control and poised to implode? No problem--just transfer all the uncollectible debt (i.e. losses) to the taxpayers.

If you believe that's an actual solution, I have a little 3-Card Monte game over here I'd like you to play until you have no more earthly (or Martian) possessions. Alternatively, just sink all your money into the stock market that's poised to crash. That will wipe you out just as effectively as the rigged 3-Card Monte game.

Don't think the Status Quo will save you, or make good on its vast multitude of promises. Naive faith in promises and fantasies isn't helpful in the real world.

 

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Tue, 10/27/2015 - 09:01 | 6716140 NoDebt
NoDebt's picture

"But I was promised!"

"You fucked up.  You trusted us."

Tue, 10/27/2015 - 09:15 | 6716220 Money Counterfeiter
Money Counterfeiter's picture

Greedy Zionist run this shit hole.

Tue, 10/27/2015 - 09:17 | 6716232 negative rates
negative rates's picture

You know if trust too much, you don't make too many birthdays.

Tue, 10/27/2015 - 09:25 | 6716274 duo
duo's picture

Year 2025

 

SS monthly check $1600

Medicaid part B premium $1500

Enjoy that $100/mo

Tue, 10/27/2015 - 10:58 | 6716627 Money Counterfeiter
Money Counterfeiter's picture

Opium is $286 at Wallgreens.  Fuck Medicaid.

Tue, 10/27/2015 - 09:01 | 6716141 MFL8240
MFL8240's picture

There is no status quo anymore since this country was taken over by this group of dishonest progressives!

Tue, 10/27/2015 - 09:12 | 6716189 ThirteenthFloor
ThirteenthFloor's picture

Are you sure it's not a bunch of elite rich fucks that want to drain you of your precious bodily fluids.

Tue, 10/27/2015 - 09:13 | 6716207 venturen
venturen's picture

progressive sold out to bankers...at least in the old days you could trust progressive to rant on about this and that....but they were harmless

Tue, 10/27/2015 - 09:01 | 6716142 Usurious
Usurious's picture

 

 

'The Future is in Backwardation'.............trav7777

Tue, 10/27/2015 - 09:06 | 6716163 pods
pods's picture

We are so far from normal that now throwing shit against the wall and seeing what sticks is a valid plan of action.

Look at all the long term FED charts, shit's broke and isn't going to be fixed.  

System is dead Jim.

pods

Tue, 10/27/2015 - 09:14 | 6716211 venturen
venturen's picture

they are throwing shit at a fan...not a wall

Tue, 10/27/2015 - 12:02 | 6716933 OldPhart
OldPhart's picture

It used to be that you'd throw shit on the wall and 99% of it would slide to the floor.  The problem is so bad that the wall is covered in shit and still nothing is working.  Not even the routine processes.

Tue, 10/27/2015 - 09:11 | 6716185 hairball48
hairball48's picture

Don't you dare touch my social security. I'll be 68 years old soon.

Al Gore promised me years ago my social security was in a "lock box". And I want my cost of living raise restored too.

Wahhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhh!!!

/sarc :)

Tue, 10/27/2015 - 09:12 | 6716196 venturen
venturen's picture

what happened in 2008 that caused the debt to skyrocket and the 1% to start getting so vastly richer?

Tue, 10/27/2015 - 09:14 | 6716217 venturen
venturen's picture

Oh Democrats backed by Soros, Buffet, Steyer and Wall Street

Tue, 10/27/2015 - 09:15 | 6716221 GernB
GernB's picture

Attempting to stop am entire economy from correcting

Tue, 10/27/2015 - 09:26 | 6716266 negative rates
negative rates's picture

The 15% 30 year E-bonds were coming due (do the math) and then we extended the bush tax cuts which were going to help facilitate the cost of paying off the e-bonds fully, a double whammy tax frenzy which placed the burden on the future tax paying middle class because the rich insist on everyone paying their fair share after they financed the recovery.

Tue, 10/27/2015 - 09:14 | 6716215 GernB
GernB's picture

But we need social security because everyone else but me will screw up saving for retirement.

Tue, 10/27/2015 - 09:43 | 6716347 SmallerGovNow2
SmallerGovNow2's picture

No, because I paid for it ALREADY now give me my mother fucking money.  Lump sum what i paid in already (without interest) is fine, but fork it the fuck over...

Tue, 10/27/2015 - 11:56 | 6716912 Marco
Marco's picture

Social security is not a pension fund, the small fund they have is just to paper over funding short falls. You didn't pay anything "in", you simply paid a payrol tax to fund a welfare scheme.

Tue, 10/27/2015 - 10:03 | 6716422 Cloud9.5
Cloud9.5's picture

Ever since the boys got off the boat in James Town the trend has been toward more growth.   Yes, there were several rebellions and panics but the trend has always been toward more growth.  The growth going forward is in chaos management and the cannibalization of failed systems.  The invasion of Europe and the United States by the Golden Horde is just the first phase of the new trend of mass migrations.  As cities and and states continue to fail what is left of the safety nets will fail.  The prime real estate is farm land and the new building trend will be mott and baily castles.

Tue, 10/27/2015 - 11:50 | 6716890 Marco
Marco's picture

The money is just paper. Does the US have the natural and human resources to maintain it's current standards of living despite demographic chages?

Almost certainly yes. US has a natural resource pool second to none, one of the best human resource pools on the planet and technological advances will easily maintain average productivity due to increased per worker productivity even as the percentage of workers decreases.

Europe I'm not so sure about, mostly because the human resource pool is going to dry up as everyone intelligent flees the muslim invasion.

Tue, 10/27/2015 - 15:07 | 6717801 polo007
polo007's picture

According to Macquarie Research:
 
http://is.gd/QdV7KJ
 
The more they do; the worse it gets
 
In our latest commentary we ask whether indications of easing by ECB and PBoC and BoJ’s potential expansion of its own stimulus would lead to further contraction of global GDP/trade and whether only Fed QE4 could be reflationary.

 
Deflators of the world unite. As expected (here), CBs are becoming concerned. Not only has the Fed deferred tightening but ECB is sending a strong signal that it is contemplating expansionary measures by Dec’15 and it is likely that BoJ would at some stage increase both size and pace of its own stimulus. Finally, PBoC has simultaneously cut interest rates and RRR. Not surprisingly, financial assets responded in a typical “Pavlovian fashion” by assuming a “goldilocks” outcome of low interest rates for longer; ample liquidity; steady (but unspectacular) growth rates and low but positive inflationary outcomes.
 
However as discussed here and here, short of massive globally co-ordinated rise in monetary stimulus, incremental changes are unlikely to make much difference and there is an urgent need to re-think the entire Government support system by either allowing restoration of conventional business cycles (unlikely) or embarking on far more extreme and unorthodox policies (such as CBs directly funding fiscal spending, investment and consumption). Erosion of global velocity of money is severely blunting the impact of more conventional QEs.

 
At the same time, the divergent paths of the Fed and other key CBs are causing monetary and inflationary cross-currents. In essence non-Fed CBs are attempting to export their domestic overcapacity and deflation to the rest of the world and the more aggressive they become, the higher would be the likely deflationary outcomes.
The global economy and trade are already shrinking in US$ terms. In the last three quarters, global (US$) GDP has shrunk at ~5% clip with US$ global trade eroding at ~10% pace. The more ECB, BoJ and PBoC ease, the more likely US$ would ultimately appreciate at far stronger pace. Whilst initially an increase in non-US monetary stimulus reduces perception of tail risks and hence stabilizes or even depreciates US$, over the longer-term it is a recipe for much higher US$. As a result, at some stage DXY (US$) could surge from 95-97 to 110-120 and possibly higher. This would further compress the size of the global economy and trade (US$), perhaps returning global economy back to the levels of ‘09-10 (essentially wiping out the last five or six years of growth).
 
Why is measuring global economy and trade in US$ critical? As discussed in the past, global economy resides on the de-facto US$ standard. Other currencies play relatively minor role, with US$ accounting for ~50% of global transactions and in excess of 70% of global finance (Rmb is responsible for only ~3%). US$ is particularly significant for Asia-Pacific traders, Latam and commodity producers (though less so for Eastern Europe). If Fed tightens, it could potentially get much worse. However, even if Fed does not tighten but simply refuses to embark on a QE4, the outcome would still be higher deflation and lower US$ global economy and trade. In other words, some currencies are more equal than others and therefore Fed’s policies are far more inflationary than equivalent policies pursued by other CBs. If our core assumption of no tightening but no QE4 comes true, then deflationary pressures are still likely to strengthen as supply of global US$ continues to contract.
 
This explains our unwillingness to buy countries like Indo or Mal and instead our preference for commodity consumers and countries with trapped domestic liquidity and limited external vulnerabilities (i.e. India, China, Phil and Taiwan).

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