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Biderman Explains The Bullish Market Ponzi

Tyler Durden's picture




 

"All markets trade their way to Perdition" is how TrimTabs' CEO Charles Biderman concludes a rather clear and factually full exposition of the reason we have gone up and the reality of why a drop is inevitable. Between the outsize number of investment vehicles relative to investable assets, the trend bias that every wealth manager seems stuck with that we will grow our way out of this mess (which Biderman suggests means a long-term rate of 5-10% GDP growth for the US - which seems obviously beyond our reach). He takes on the irony of the Wall Street vs Main Street arguments and warns of the inevitable plunge in the stock market (further believing that the winner of the next election is irrelevant given the cash vs special needs imbalance that exists). The US economy, if marked to market, is broke. Take home pay for all taxpayers is now only $6.2tn, down from $7tn at its peak in 07, and additionally we have created $5tn of new debt since the start of QE1 and owe a PV of $50tn in 'unfunded' liabilities leaving the future looking quite grim in his view. Perdition indeed appears to be looming given the Fed's far from sanguine view of reality.

 

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Thu, 01/26/2012 - 14:27 | 2100313 DoChenRollingBearing
DoChenRollingBearing's picture

I have always respected TrimTabs.  Take home pay $800 bn LESS than in 2007.  LOTS more debt.

 

YIKES!  Guess it's time to buy more gold...

Thu, 01/26/2012 - 14:37 | 2100360 Silver Bug
Silver Bug's picture

The only way the stock market won't go into free fall is if they continue QE to infinity. Wall street knows this, therefore we will see QE to infinity, at the expense of the tax payers of course. That take home pay is going to get even smaller as the years go on.

 

http://ericsprott.blogspot.com/

Thu, 01/26/2012 - 15:11 | 2100483 derek_vineyard
derek_vineyard's picture

5 year TIPS -1%+

10 year TIPS recently turned negative

you can have a guaranteed loss in government backed treasuries or you buy other assets----that IS the game, msft chooses to lose a few % a year with its billions  rather than invest their cash before the collapse

0.25% federal funds as far as the eye can see??????  this is an EPIC CRISIS...uncharted waters, unheard of

Thu, 01/26/2012 - 15:18 | 2100505 tarsubil
tarsubil's picture

Man is this sobering. Good thing it is pint night and I have a well stocked fridge at home.

Thu, 01/26/2012 - 15:19 | 2100509 JR
JR's picture

Yes, and msft, as well as the Fed, must be expecting EPIC CRISIS straight ahead .

Thu, 01/26/2012 - 16:07 | 2100673 sunny
sunny's picture

EPIC CRISIS??

Serious question.  There will be a major announcement near the end of February from Euroland where there are hints of a huge --like 10 to 100 Trillion euro-- print over the next several years to "stabilize" the European scene.  Merkel is scared silly thinking that if the EU crashes and it is seen as Germany's fault it will be WWII all over again, she'll go along.  So let's say that there is a mind-boggling print in the EU.  Benny, not to be outdone, either covertly or overtly, pumps, say, 10+ Trillion dollars into various high frequency trading banks and hedge funds with specific instructions to keep the indices up.   He's already pumped 7 Trillion into the system under the table/blanket of TARP, no reason for him to hold back now.  Anyway, who is to stop him?  This is possible as sheeple don't now the difference between being rich and being wealthy.   What will happen to world markets?  Crash or fly??   I figure that would be good for at least a 12 month rally to new Dow/SP highs, irrespective of what happens to bonds and employment.  Experts will scream and cry and demand an end to the Fed and no one will lift a finger to stop Benny or the ECB.  Invest accordingly.

sunny

Thu, 01/26/2012 - 17:00 | 2100821 gaoptimize
gaoptimize's picture

And what estimate of inflation do you think TIPS will protect you from?  John Williams' at ShadowStats?  I think my wife's gold and silver Valkyrie cups provide better protection.

Thu, 01/26/2012 - 16:50 | 2100790 Xkwisetly Paneful
Xkwisetly Paneful's picture

It is the only thing that sent the commodities skyward too as evidenced by the free fall after the last QE ended.  I think exactly two members of the herd posted as much in advance while 90% of the posts were advocating continued buying AU, AG et al but I can't count.

Thu, 01/26/2012 - 17:49 | 2100957 Robsabi
Robsabi's picture

Actually, gold rose almost 20% (from around 1600 to 1900) at the start of the last big dip at the end of July, 2011, QE2 having ended just 4 weeks before, on July 1. True, that was in response to the panic that started at that time, but since then at its worst, gold only gave back those gains, falling back to just below 1600, and now of course it's back up over 1700.

So while the forces in effect after QE2 probably have buffeted the price of gold around, it hasn't actually been in a free fall from the levels it was at during QE2, and in fact is at a higher price right now than it reached at any time during QE2, or any of the QE action before that.

So, at least when it come to gold, the "zerohedge herd" was right, and the "two members" you highlight were basically wrong.

Thu, 01/26/2012 - 15:18 | 2100503 HD
HD's picture

Nothing wrong with a little debt...I mean for every trillion we put on the sovereign platinum debt card - we get 500 airline advantage miles!*

 

*Subject to availability and black out dates. Not valid to escape societal collapse. 

Thu, 01/26/2012 - 17:08 | 2100841 Marco
Marco's picture

No, you get a couple hundred million dollar worth of oil you couldn't otherwise afford (the rest goes to the cronies).

Thu, 01/26/2012 - 16:08 | 2100558 cranky-old-geezer
cranky-old-geezer's picture

 

 

Take home pay $800 bn LESS than in 2007. 

Actually it's $2,960 billion less when stated in '07 dollars, because USD has lost 40% of its value since '07.

13% drop in take-home pay since '07.

48% drop in take-home purchasing power since '07.

THAT'S why America is in a depression, not recession.

[BTW RoboTard and other stock market bulls out there, today's 12,800 DOW is 7,680 in '07 dollars ..a 45% loss since '07's 14,000 top.]

[...and today's $1,700 gold is $1,020 in '07 dollars ...a 10% gain since '07's $924 close.]

Thu, 01/26/2012 - 16:46 | 2100776 Xkwisetly Paneful
Xkwisetly Paneful's picture

No better way to keep the commoners down than skyhigh food and gas prices coupled with declining wages.  Next a littany of tax hikes. Zero upward mobility.  Using the governments to maintain their place in the world all the while yapping about giving a shit about the poor and middle class is their playbook. The only endgame is wretchedness and oppression with the greatest degrees of magnitude effecting the bottom up.

Wait till the avg peasant has to go buy corn after the obvious upcoming massive dilution of paper currency.

Fri, 01/27/2012 - 00:08 | 2101665 Cursive
Cursive's picture

@cranky-old-geezer

Well said.  This should be a ZH post of its own.

Thu, 01/26/2012 - 18:56 | 2101113 AbelCatalyst
AbelCatalyst's picture

 

Long live Math!!  

It is an absolute impossibility to manipulate, spin, print, or destroy Math!!  Deep beneath the outward economy Math is doing it's work - an unrelenting, dispassionate force of reality.  Math works slowly at first, building pressure, but there will reach a moment in time when a tipping point will be reached and Math with have His day!!  

Long Live Math!!! 

Fri, 01/27/2012 - 00:10 | 2101666 Cadavre
Cadavre's picture

YIKES!  Guess it's time to buy more gold.

Do they manipulate gold? Sell it - sell it now - sell the house, sell the car, sell the kids, sell the wife  - sell the frog the dog the gerbil `an move ur ass to an abandoned offshore oil rig cause Milt's ghostly prostate is `bout to open full on for one last blast golden shower USD trickle down and flush the remaining soured contents of St. Friedman's incontinent bladder from a fast approaching QE Storm!

If the culmination of god's work requires the entire global structure to collapse, so be it: As long as the dollar carry carries the ticks to even more rapturous highs till the lipsticked well poked pig can't squirm no more.

FOG of War setup:
Anything and everything to scare up oil and tear up the dollar (they're still pitching global warming carry fer chris sakes)! The "threat of closing the "Straits" was the best news the HFT Dollar Carry Boyz have had for a long time.  We now witness a "should be mothballed" carrier steaming into the Persian gulf. What's that about? Anyone see dead people sailing to a last port of call to be an all hands aboard target for coup counting freedom hating dolphins as the big floating museum weighs astride Hormuth with bright red white blue bullseyes painting the soft spots and takes 3 in the flanks? It happen a couple of times before, and the response, as always, is hush hush and on the QT. When you be GI you be nothing more than one collateral damage loss leader unit for the War Usury's marketing department. It be little surprise to open eyes when  the hypno-tube ray blasts rashes of frenzied tongue talking for more genocide in the name of Freedom and the recently minced Pesrian Gulf chum that used to be someones son, someones mother, someones brother or father. Jes one more "just cause" for jez one one more frenzied blood bath dance into barbarianism.

USD reserve status cold shouldered as bilateral trade agreements begin to erupt. Right now India Russia, China Iran and others will trade with non USD credits. EU delays 6 months and Iran say f* it - we ain't gonna ship you any now or later and calls the EU's blusterous girlie bluff. The Esteemed Der Berskank freezes rates (how might one freeze nothing?) and the Wallies foam in anticipation of EOY boneruses.

And what the f* is Bidermen storying with this video?

Watched listened. Noodled it weren't one of them one of them SNL parodies. The guy playing Biderman in the vid is not wearing an off the shelf suit  .. obviously it must be Mr. B ... soo ... then, seeping from the ether a whispered phrase of Bartokish dissonance from hell shepherds the moment through spinning plastic wavy lined design vortices ending at grainy scene from Apocalypse Now (scene here) , where Brando's character asks Sheen's character, "Are my methods unsound?". Sheen's reply, " I see no method .. at all.".

Humble narrator see no message at all, either, in the subject vid, At least no new message. Do love Biderman's ration of rage asserting wall street and DC as being distinct entities separated by some invisible ethical forcefield. An old testament gypsy pop culture honor among thieves thing-a-ma-bobby  ... right - shit - another thief is a thief's largest demographic.

After laying the foundation for his premise. Wall Street is not DC, Biderman concludes the collapse is the pimp's fault, and not the whores. Anybody remember when the republic didn't have a Goldman alumnus as Der DoT Kapo? Do no one `member when DoD was headed by a public servant and not some War Industry butt boy?

Formula for good economy: Eat drink and be merry for tomorrow you will die (raw material for fusion center Soylent Green factories - no doubt).

Fri, 01/27/2012 - 00:48 | 2101714 tsx500
tsx500's picture

got it.

Thu, 01/26/2012 - 14:31 | 2100325 TruthInSunshine
TruthInSunshine's picture

Fake Plastic Trees wasn't just an alternative hit by Radiohead, it was a brilliant Orwellian missive about the future Ponzi, all things included - especially unicorn equity slot machines - with one trillion percent more ponizification than before, and even with new, plastic/polymer fiat (replacing paper fiatski):

Canada's new plastic $100 bill is all tricked out - latimes.com

 

*When all fiat goes plastic, the rabble will be very cold. That shit doesn't burn.

Thu, 01/26/2012 - 14:48 | 2100393 stirners_ghost
stirners_ghost's picture

 

But gravity always wins

Thu, 01/26/2012 - 18:47 | 2101095 AbelCatalyst
AbelCatalyst's picture

True...  So does Math!!

Thu, 01/26/2012 - 15:26 | 2100539 calgal
calgal's picture

omigod that video is hilarious....it looks like a hocus pocus magick trick....all it needs is a cape, a wand and a wabbit!!!

 

Thu, 01/26/2012 - 14:30 | 2100330 Eireann go Brach
Eireann go Brach's picture

If the great Charles Ponzi was still alive today, he would be Obama's Treasury Secretary!

Thu, 01/26/2012 - 14:31 | 2100334 The Deleuzian
The Deleuzian's picture

Looking for a big correction in equities...Probably means the S&P will be 1400!

Thu, 01/26/2012 - 14:31 | 2100335 Cdad
Cdad's picture

 Between the outsize number of investment vehicles relative to investable assets,

Oh so dead on!  And as I have often said, when ETFs can print infinite "creation units" on a finite set of underlying stocks, you have to sit back and admire the size and scope of the Wall Street criminal syndicate's Ponzi scheme.

Thu, 01/26/2012 - 15:33 | 2100563 blindfaith
blindfaith's picture

 

 

 

Hummm...you try and tell that to the 401k, mutual fund investing crowd who honestly ( sarc) believe THAT is their retirement and Social Security is NOT, and the 401k will be there and SS will not.

Thu, 01/26/2012 - 14:33 | 2100342 Uptown
Uptown's picture

To all those Spanish kids out there,

"Oro, putas"

Thu, 01/26/2012 - 14:57 | 2100437 gmrpeabody
gmrpeabody's picture

BTFD putazzz...

Thu, 01/26/2012 - 16:42 | 2100771 DoChenRollingBearing
DoChenRollingBearing's picture

CLCB (Compra La Carajada Bajada), putaz!

Thu, 01/26/2012 - 14:33 | 2100343 Jason T
Jason T's picture

per·di·tion

  http://sp.dictionary.com/en/i/dictionary/newserp/Sprite_Serp.png); background-attachment: scroll; background-origin: initial; background-clip: initial; background-color: transparent; width: 20px; height: 19px; cursor: pointer; display: inline-block; padding-left: 3px; background-position: -619px -478px; background-repeat: repeat repeat;"> [per-dish-uhhttp://sp.dictionary.com/en/i/dictionary/newserp/Sprite_Serp.png); background-attachment: scroll; background-origin: initial; background-clip: initial; background-color: transparent; background-position: -491px -482px; background-repeat: repeat repeat;" src="http://sp.dictionary.com/dictstatic/dictionary/graphics/luna/thinsp.png" border="0" alt="" />n] http://sp.dictionary.com/en/i/dictionary/newserp/Sprite_Serp.png); background-attachment: scroll; background-origin: initial; background-clip: initial; background-color: transparent; background-position: -491px -482px; background-repeat: repeat repeat;" src="http://sp.dictionary.com/dictstatic/g/d/dictionary_questionbutton_defaul..." border="0" alt="" /> Show IPA noun
1.
a state of final spiritual ruin; loss  of the soul; damnation. 2.
the future state of the wicked. 3.
hell def. 1 . 4.
utter destruction or ruin. 5.
Obsolete loss. F@#K

Thu, 01/26/2012 - 14:33 | 2100344 mcarthur
mcarthur's picture

5-10% GDP growth is certainly achievable if you are talking nominal and not real.  All problems will be "solved" with a healthy dose of Zimbabwe inflation. 

Thu, 01/26/2012 - 14:52 | 2100420 inkarri9
inkarri9's picture

Didn't Ben say that the inflation target was 2%?  I also believe that former US Comptroller General, David Walker said we would need double digit growth for decades to "grow" our way out of our mess.

Thu, 01/26/2012 - 15:01 | 2100450 EscapeKey
EscapeKey's picture

Before you know it, the CPI weights will be adjusted to suggest we're going through "deflation".

By then, the food component will probably be negative.

Thu, 01/26/2012 - 15:05 | 2100469 Everybodys All ...
Everybodys All American's picture

I seriously doubt we will ever see that kind of growth again because of the fact that out debt refy cost's are so high. A certain amount of gdp is lost to this every year for debt refinance.

I just can't ever conceive it.

Thu, 01/26/2012 - 15:36 | 2100575 blindfaith
blindfaith's picture

 

 

 

I have said many time on ZH, made up and imaginary numbers don't lie.  The problem is trying to keep up with the lies once they get this far out of control.

Thu, 01/26/2012 - 14:35 | 2100345 Waterfallsparkles
Waterfallsparkles's picture

I guess you can only blow hot air in the balloon for so long before it pops.

Thu, 01/26/2012 - 14:35 | 2100351 The Deleuzian
The Deleuzian's picture

Dude hit it on the head...More money's been made inventing new 'vehicles' to buy/sell than companies themselves...

Thu, 01/26/2012 - 14:37 | 2100359 lynnybee
lynnybee's picture

i don't know who i like better, Mr. Biderman or Dr. Faber ...... how i love a tell-it-like-it-is , no nonsense, basic kind of guy !

Thu, 01/26/2012 - 14:46 | 2100401 Gimp
Gimp's picture

Unfortunatley both will be ignored in the history books after the collapse

Thu, 01/26/2012 - 17:20 | 2100877 grid-b-gone
grid-b-gone's picture

Just like the last collapse, no one can see this one coming.

Thu, 01/26/2012 - 14:39 | 2100370 Sudden Debt
Sudden Debt's picture

THE EMPIRE HAS WON! DEATHSTAR IS IN POSSITION!

 

Thu, 01/26/2012 - 14:39 | 2100373 evolutionx
evolutionx's picture

HYPERINFLATION WILL DRIVE GOLD TO UNTHINKABLE HEIGHTS

We now live in a world where governments print worthless pieces of paper to buy other worthless pieces of paper that combined with worthless derivatives, finance assets whose values are totally dependent on all these worthless debt instruments.  Thus most of these assets are also worth-less.

 

more:

http://www.mmnews.de/index.php/english-news/7063-hyperinflation-will-drive-gold-to-unthinkable-heights

Thu, 01/26/2012 - 14:41 | 2100379 carbonmutant
carbonmutant's picture

The trick is to make sure" perdition" is someone else's problem...

Thu, 01/26/2012 - 14:42 | 2100387 Cdad
Cdad's picture

Done and done...unborn American generations to come.

Thu, 01/26/2012 - 14:43 | 2100388 Truffle_Shuffle
Truffle_Shuffle's picture

Lets just get the confiscation of the world's assets over already......I need to fucking move on.

Cue the false flag Alien Invasion.

Thu, 01/26/2012 - 14:44 | 2100395 Gimp
Gimp's picture

Biderman will not be getting invites from CNBS or Bloomberg anytime soon with that negative outlook!

Bring on the pom-poms quick....Becky

Thu, 01/26/2012 - 14:53 | 2100416 tempo
tempo's picture

How many of us buy AAPL products for our kids?? How many of understand or care that AAPL executives are worse than the slave traders/owners of the 1850s?? Check out www.marke-ticker.org post today for a description of the living hell that the AAPL/Foxconn workers face...60 hour work week for $2.20/hr;70,000 person workforce living in dorms.. 20 people per 3 room apt (3000 room dorms). Workers faced with poor ventilation and little or no protective health gear or regulations. Aluminium dust explosions causing deaths. Obama claims America doesn't produce the workers AAPL needs. Well many of the Foxconn workers have PHds and work in danger workplaces as slaves. Thats Obama's view of hope and change for America. Thats our future. How many of us own AAPL stock and don't give a damn about the foxconn workers?? Recently Foxconn announced it needed 1000 Industrial Engineering for its factory. This would have taken 3 or 4 years in the US colleges to fill the demand (most graduates would never work at a dirty factory)...Foxconn found the need technical expertise in 3 weeks. For the 99%, this is the life our grandchildren face.

Thu, 01/26/2012 - 14:56 | 2100433 Truffle_Shuffle
Truffle_Shuffle's picture

Imagine the world if all used our collective power as investors and consumers for the greater good.  The problem isn't one specific company or one specific person.  The problem is us, which includes you and me. 

Thu, 01/26/2012 - 15:00 | 2100448 azzhatter
azzhatter's picture

And all the jackoff plantation owners like Jeffrey Immelt will tell you "at least they are better off than when they had no job"

Every one of these fuckwads should be forced to eat aluminum dust 3 meals a day

 

May every member of the oligarchy get a horrible form of ass cancer and die a painful hideous death

Thu, 01/26/2012 - 15:09 | 2100481 EscapeKey
EscapeKey's picture

This morning on Sky News, they trumpeted that Subway would create 6,000 new jobs in the UK.

Uh yeah, but they'll all be sucky low-entry jobs.

Thu, 01/26/2012 - 15:19 | 2100504 blu
blu's picture

Here in California some spin-meister was trying to explain how the proposed high-speed rail project would create 1 million jobs.

It sounds insane, because it is: Those are jobs counted as job-years. One job for one year for one guy. Then if you then figure the project is a 20 years deal you get 20 times the "jobs" out of it than you would if you counted open positions.

If it was me, I would have probably just strangled the guy on the spot.

Thu, 01/26/2012 - 15:29 | 2100547 Dr.Vannostrand
Dr.Vannostrand's picture

If they want to make a ROI on that thing, run it from LA to Vegas. Going thru Shafter and Wasco is not going to cut it.

Thu, 01/26/2012 - 17:47 | 2100952 grid-b-gone
grid-b-gone's picture

Construction has a rosy future.

Build-a-burger, build-a-bear, build a sandwich.

Thu, 01/26/2012 - 15:03 | 2100460 LooseLee
LooseLee's picture

I thought that all of the 'jobs' AAPL created was in America? You mean the largest company in the world isn't creating American jobs? No way!

Thu, 01/26/2012 - 15:30 | 2100548 GCT
GCT's picture

Actually America does have the factories and the people to produce apple products and I do not own any of them.  A while back their cost estimate was leaked to the public for the manufacture of the Ipad.  Cost in the USA was $625.00 and in China it was $345.00 per unit and the units sell for 899.00.   Of course they choose Foxconn.  They want to maximize profits. 

I guess the POTUS meant we do not have the cheap labor and poor working conditions like China does.

Thu, 01/26/2012 - 16:51 | 2100794 tictawk
tictawk's picture

You must be a socialist.  There are thousands lining up to work at Foxcom and no one has put a gun to their heads to do so.  Business squeezes profits by exploiting differences in prices.  Get a grip or go live in China or the Soviet Union or any third world country and you will appreciate what you have here much more. 

This is not say that we are truly a capitalistic nation because we are not.  We do have socialism for the Rich and powerful (read banks, auto companies, solar companies) via bailouts....handouts. 

 

Thu, 01/26/2012 - 16:55 | 2100808 Xkwisetly Paneful
Xkwisetly Paneful's picture

They made 1/5th that or 14 cents an hour with considerably worse living conditions pre Foxconn but who cares?

According to the delusion posted above we will all be earning 5 times as much and enjoying considerably better living conditions in the future.

Thu, 01/26/2012 - 17:02 | 2100830 snakeboat
snakeboat's picture

Nope, Mama Earth's gonna take care of our lil 'situation' before too long.  Finite world and all.

http://www.financialsense.com/node/7445 

For my daughter's sake, I hope it's further off than the signs are saying... 

Thu, 01/26/2012 - 14:57 | 2100436 slewie the pi-rat
slewie the pi-rat's picture

so the 1 Tril $$$ debt ceiling should be used for a "jobs bill" for sure!

they can pass this late tonight and prez0 can sign it at the crack of dawn, and then everybody can split for the weekend

"jobs bill" = emergency 20% raise for all federal employees

the 1 $Tril$ won't be enough? 

"exempt" the people in the dept0'Labor!  have a nice weekend!

Thu, 01/26/2012 - 15:01 | 2100453 blu
blu's picture

America can easily grow itself at 10% annually, and in real terms. The British did it for 200 years. You simply conquer other nations, enslave their people and plunder their resources.

You think I'm kidding.

Thu, 01/26/2012 - 15:26 | 2100537 Dr. Engali
Dr. Engali's picture

Aren't we doing that now?

Thu, 01/26/2012 - 15:28 | 2100546 blu
blu's picture

You noticed. Not many do. Nor will they so long as the loot keeps rolling in.

Thu, 01/26/2012 - 15:02 | 2100456 KandiRaverHipster
KandiRaverHipster's picture

give me a break!  wall street didn't object to these policies of loose money and increased home ownership. 

Thu, 01/26/2012 - 16:40 | 2100767 tictawk
tictawk's picture

It is NOT wall streets job to object or make policies.  they are in the business of exploiting govt policies for a gain.  Its govt fault for the stupid policies.

Thu, 01/26/2012 - 20:48 | 2101376 blunderdog
blunderdog's picture

It is NOT wall streets job to object or make policies.

Sure it is.  Institutions on Wall St. hire lobbyists who push certain policy suggestions and often have direct input into the writing of legislation.

You've heard of lobbyists, right?

I think the idea is that because all institutions have access to lobbyists, it's supposed to be fair to everyone.  Whichever industries/businesses have the most to spend on lobbying get the most input into how laws are written. 

This is good for everyone except individual citizens, whose primary political "power" is supposed to be the votes for the representatives who write the laws the lobbyists buy.

Thu, 01/26/2012 - 15:05 | 2100470 antidisestablis...
antidisestablishmentarianismishness's picture

If this guy were bullish the deragatory comments about his appearance and delivery would be deafening. But since he's bearish he's treated like the latest genius.

Thu, 01/26/2012 - 15:08 | 2100478 Bam_Man
Bam_Man's picture

Looks like the market has given Charlie quite a beating lately.

He's not speaking to us from Sausalito anymore. Hollywood, FL is quite a step down from there. But the bagels are better.

Thu, 01/26/2012 - 15:16 | 2100499 Don Levit
Don Levit's picture

There is a very interesting article entitled "The GDP Deception" that was posted on financialsense.com recently.

"Money velocity times money supply equals GDP.

As long as the velocity stays above 1, the GDP has to increase if the money supply (including debt) increases.

Don Levit

Thu, 01/26/2012 - 15:26 | 2100540 blu
blu's picture

That's right. Our GDP is almost entirely due to motion, as opposed to actual production of anything having tangible value.

A particular juggler can manage to juggle 8 balls in the air, while never actually holding more than one of them at any instant. But if he had to suddenly stop juggling he would only have the one, and the others would fall on the floor lost. Because he could never actually manage them all if they didn't stay in motion.

That is America since 1985; It's an act with lots of wealth in motion but not much wealth in hand. Oh and the act has just ended.

Thu, 01/26/2012 - 15:25 | 2100526 Dr. Engali
Dr. Engali's picture

He is spot on about the markets and debt, but Wall Street is just as much to blame for the mess as well as Washington. Their hands are all dirty. The American public has to take their fair share of the lame too. We allowed and still allow this unholy alliance to get away with it.

Thu, 01/26/2012 - 15:32 | 2100561 Sandy15
Sandy15's picture

I've tried to stop it by NOT paying my taxes over the last two years.  They come after the money anyway.......

I've tried to stop it by calling my congressman or senator.  They ignore me.........

I've tried to stop it by protesting at the capital building SEVERAL times.  The ignore me again........

 

WHAT DO YOU SUGGEST WE DO TO STOP IT?

Thu, 01/26/2012 - 15:40 | 2100590 Dr. Engali
Dr. Engali's picture

Yeah you're proably right. Doing nothing is probably the best thing. What was I thinking? Slip  back into the matrix and eat some steak...or is it tasty wheat? 

Thu, 01/26/2012 - 15:54 | 2100635 death_to_fed_tyranny
death_to_fed_tyranny's picture

How about armed revolution. How about we try the "leaders" for treason. If found guilty, a cigarette and a blindfold with a bullet to boot. This is just a suggestion. Under no circumstance do I mean what I say. For the NDAA can lock me away for the mere mention of this. Carry On.

Thu, 01/26/2012 - 16:45 | 2100777 blu
blu's picture

It cannot be stopped.

However it is a self-limiting problem -- it will solve itself if left alone.

Of course it will also kill over half of all human life in the process of solving itself by its own means. And then another half of what's left in passing. And then yet another half of the pitiful, bewildered survivors on the random rebound. But you can't stop any of that either.

Humans. Always pretending to be the masters of the universe. Well it was luck that got you here in the first place, and luck of another kind that kept you here even a short while, and it will be luck of a third kind that will scrape humanity from the surface of this outpost rock like some kind of unwanted algal deposit from a stone on the shore of a raging sea.

The universe does not care. The thin, transient film that was all of humanity will finally eat itself and perish utterly. Enjoy what remains of the ride.

Thu, 01/26/2012 - 15:26 | 2100532 Ghostintheshell
Ghostintheshell's picture

and that was "Springers" final thought!

Thu, 01/26/2012 - 15:37 | 2100582 ThisIsBob
ThisIsBob's picture

He needs to do do a better job of explaining all that to price.

Thu, 01/26/2012 - 15:41 | 2100583 Waterfallsparkles
Waterfallsparkles's picture

With unempolyed people and lower wages, that means fewer taxes being collected.  Plus, Boomers are Retiring and will not be paying taxes into the system.  They will be takers in the form of SS & Medicare.

They keep printing debt buy who will pay for it in the end?

It is really unfair to the Boomers that are retiring to keep the interest rate at zip.  Bernanke wants them all to put their Retirement Money in the Market but that is not a wise thing to do.  Most people ready or already Retired still remember 2008 meltdown and are not going to risk what ever they have left to keep the Stock Market inflated.

Better in your mattress than the Market.

Thu, 01/26/2012 - 15:48 | 2100614 Bendromeda Strain
Bendromeda Strain's picture

Where is pan-the-ist to rebut that neocon tool Biderman's assertion that Washington was NOT in fact blameless for the housing mess. I could have sworn I saw him post the other day that NOONE believes that tripe about Washington interference leading to bad outcomes.

He's probably filling bowls at the rescue mission. Such a humanitarian.

Thu, 01/26/2012 - 16:09 | 2100677 earleflorida
earleflorida's picture

.

Thu, 01/26/2012 - 17:41 | 2100936 farmerjohn2112
farmerjohn2112's picture

+1 for brevity

Thu, 01/26/2012 - 16:34 | 2100745 orangedrinkandchips
orangedrinkandchips's picture

He looks drunk

Thu, 01/26/2012 - 16:34 | 2100750 tictawk
tictawk's picture

Bulls may believe that the Fed could install QE to infinity except that the debt markets will collapse first.  The only reason stocks can benefit from QE is IF the debt markets behave i.e. our debt is sucked up by investors.

Fri, 01/27/2012 - 03:58 | 2101883 resurger
resurger's picture

Of course, now they need to suck our money too and make thos fucking CEO's Richer

Thu, 01/26/2012 - 16:40 | 2100763 orangedrinkandchips
orangedrinkandchips's picture

 

"When the true kings murderers are allowed to roam free...A THOUSAND MAGICIANS WILL RISE IN THE LAND"...Jim Morrison

Thu, 01/26/2012 - 16:47 | 2100781 q99x2
q99x2's picture

Wall Street didn't do it. Washington did it, Washington did it...

His opinion that there are entities to take separate blame appears to be an attempt to rationalize some kind of personal agenda. Dude, its an organized crime ring. Give credit where it is due.

Thu, 01/26/2012 - 16:49 | 2100789 Shizzmoney
Shizzmoney's picture

Right....the guy seems to forget Wall St is Washington DC; DC is Wall Street.  Einhorn is Finkle; Finkle is Einhorn.

Sound analysis either way, though.  People just don't understand the hole we have to dig ourselves out of just to build a dam made out of adobe. 

Thu, 01/26/2012 - 17:28 | 2100899 Blanc swan
Blanc swan's picture

"Take home pay for all taxpayers is now only $6.2tn, down from $7tn at its peak in 07"

Where can I find this data? I'd like to see what it was in 2000, 1990, etc.

Thu, 01/26/2012 - 18:35 | 2101072 blindman
blindman's picture

http://geraldcelentechannel.blogspot.com/2012_01_26_archive.html
Thursday, January 26, 2012
The Elite want to Destroy America
( short video on mind manipulation through media )
" use america to destroy america." there the big plan.
.
Gary Null - The Natural Living Show
Thursday January 26 12:00pm
http://archive.wbai.org/
relates to this. last part of hour interview
with cullen murphy ( minute 42.00 )
http://www.vanityfair.com/politics/features/2009/02/bush-oral-history200902
concerning "the inquisition". (god's jury) i did not know
that it was actually called off, officially, in 1908.
then the fed took over, having left the world adrift
for 5 years. digital inquisition cometh?
also here paul creig roberts, dr.,"drowning in hypocrisy.." commentary. (minute 24.40)
and 250,000 farmers drank pesticides, suicide, to get
out of debt to monsanto? could that be?

Fri, 01/27/2012 - 05:39 | 2101916 Lord Koos
Lord Koos's picture

What I love about Charles is the sense of joy he brings.

Fri, 04/06/2012 - 03:06 | 2321446 kevin22
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