Guest Post: It's Time To Connect The Dots

Tyler Durden's picture

Submitted by Simon Black of Sovereign Man Blog,

This week may very well go down as ‘connect the dots’ week. Things have been moving so quickly, so let’s step back briefly and review the big picture from the week’s events:

1) After weeks… months… even years of posturing and denial, Spain and Cyprus became the fourth and fifth countries to formally request aid from Europe’s bailout funds on Monday.


In doing so, these governments have officially confessed to their own insolvency and the insolvency of their respective banking systems.


Meanwhile, Slovenia’s prime minister said that his country may soon ask for a bailout. (Humorously, Slovenia’s Finance Minister denied any such plans.)


Spain’s 10-year bond yield jumped to over 7% again in response, and many Spanish banks were downgraded to junk status by Moodys.


2) Over in the US, the city of Stockton, California filed for bankruptcy this week… the largest so far, but certainly a mere drop in the proverbial bucket.


3) JP Morgan, considered to be among the few ‘good’ banks remaining in the US, conceded that the $2 billion loss they announced several weeks ago might actually be more like $9 billion.


4) The Federal Reserve reported yesterday that foreigners are reducing their holdings of US Treasuries.


5) Countries from Ukraine to Kazakstan to Turkey announced that they have purchased gold in recent months to bolster their growing reserves.


6) Chile has joined a growing list of countries that has agreed to bypass the US dollar and settle all of its trade with China in renminbi.


7) China has further announced plans to create a special zone in Shenzhen, one of its wealthiest cities, to allow full exchange and convertibility of the renminbi.


8) World banking regulators from the Bank of International Settlements to the FDIC are proposing that gold bullion be treated as a risk-free cash equivalent by commercial banks.

So… what we can see from this week’s events is:

  • European governments are insolvent
  • European banks are insolvent
  • US governments are heading in that direction
  • Even the best US banks are not as strong as believed
  • Foreigners are abandoning the US dollar and seeking alternatives
  • Gold is money

These events are all connected, and the trend is becoming so clear that even the most casual observers are starting to wake up.

When you connect the dots, the next steps lead to what may soon be regarded as an obvious conclusion: the system, as it exists right now, is crumbling.

No amount of self-delusion can make this go away.

Rational thinking and measured action, on the other hand, can make the consequences go away… turning people from victims into spectators of the greatest bubble burst in modern times.

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battle axe's picture

My pen ran out of ink...

Dr. Engali's picture

That's okay Benny and the Inkjets have plenty in their printers.

Skateboarder's picture

"Gold as risk-free cash"... no shit, it's only been running the place for the last five thousand years.

PrintingPress's picture

Just a long standing tradition of using a barberic relic.

Republicae's picture

Barbaric, perhaps, but it certainly beats the over 700 failures of fiat paper money substitutes throughout history!

withnmeans's picture

The short squeeze is on, they "Big Banks" are still trying to get every penny, let them go play with themselves.
Don't pour more fuel in a BLACK HOLE !!!

sablya's picture

The chorus of reasonable people is being drowned out by the maniacs and delusionals and irrationalists who are climbing all over each other to buy into this frantic surge.  Hooray for Europe!!  The end may not be pretty but for now they are reveling in their delusion.  May their feet bleed from kicking the can once too often.

Freegolder's picture

Foreign holdings of Treasuries fell by 0.05% last week.


Hyperbole in the article.

BandGap's picture

It's time to consume the dots....micro dots.

What a long, strange trip it's been.

sabra1's picture

i too am insolvent. been drinking paint thinner for quite a while now!

Winston Churchill's picture

Don't mix drinks,no acetone chasers.

francis_sawyer's picture

It's time for Simon Black to 'become' a dot & move to Uttar Pradesh...

zhandax's picture

Who the fuck are the Kardashians and where the fuck is Uttar Pradesh? and why should anyone care?    Or is it just Friday night on ZH and everyone is liquored up and talking out of their ass?  I will just chalk it up to number three, but every time I do that, it just gets a bit worse the next time....

dick cheneys ghost's picture

Right, But what are the kardashians doing?..........

SheepDog-One's picture

I dont know....leave me alone, Im trying to watch 'Snookie and J-Woww!'

ONO47's picture

I hear Kim might be a little on the loose side.

Skateboarder's picture

Throwing money at the pseudomedical community to figure out how best to preserve their precious faces for æons to come.

Skateboarder's picture

Whoops... double post. But since I have this space anyway, and mandates are the hot shit right now, here's a classic from one of my favorite people of all time:

NuYawkFrankie's picture

Re  what are the kardashians doing?..........


Well,Kim was around my place a short time ago to do the laundry, take out the empties & do a little "dusting" in her French Maids outfit.

Wish I could - but I really cant go into more detail - you know, the old school "Dont Kiss & Tell" sorta thing...

Not sure where her sisters are... but what I can reveal is that  Kim said something about the 3 of them wanting to have some kinda slumber-party here tonite - but, hey man,  a guy needs some down-time.... (its getting to the point where they seem to  think they can just stroll in here to chill-out and lounge around in their underwear all freekin night!)

Bollixed's picture

Be sure to put a helmet on that thing...If she had as many dicks sticking out of her as she's had stuck in her she'd look like a porcupine.

SheepDog-One's picture

Oh I've already become a spectator a while back, its the only refuge you can find just watching it all from the bleachers with a shit smock on. 

Jack Sheet's picture

Buy a summer residence in Paraguay!

narnia's picture

When the credit starts to explode out of control, gold is going to deflate just like every other price denominated in worthless government promises. 

Killtruck's picture

Price...possible. Value? Doubtful.

Jack Sheet's picture

Yeah, you think someone will sell you a golden Eagle for 1000 fiat units?

MeelionDollerBogus's picture

That doesn't make any sense. Credit explosion has always caused gold prices to go up. The only thing that can cause gold prices to drop and stay down is high interest rates from the Fed and exceeding the real inflation measured from food & fuel.

Dr. Engali's picture

I've been a specator for some time. The problem is  like watching soccer, it gets  boring waiting for something to happen.

Jack Sheet's picture

If you can stay awake that long

SamuelMaverick's picture

Be right and sit tight. This is slow motion train wreck that we are watching / living thru. Patience young grasshopper.

q99x2's picture

No one has offered to pay to keep me quiet so I'm going to continue.

It's Time To Connect The Dots

You'll never catch a fly that way.

JohnKozac's picture

WTI up over 6% today.....

dick cheneys ghost's picture

Connect the dots on the next war.........


''Saudi Arabia has reopened an old oil pipeline built by Iraq to bypass Gulf shipping lanes, giving Riyadh scope to export more of its crude from Red Sea terminals should Iran try to block the Strait of Hormuz, industry sources say.''

BigJim's picture

My understanding is that Iran has gazillions of missiles.

If war erupts, Iran will be bombing SA's oil production facilities... no amount of pipelineage is going to help them.

slewie the pi-rat's picture

can't argue with the facts, can we, BiCheZ?

better get yer doomer checks outa the mail too, simon  L0L!!!  hope you're not glowing in the dark and squiring 2-headed ex-pats

i hope you are planning to get some gold into india, next...?  nice arb on the way to autumn in the mountains...  and maybe someting gobi or go home;  don't ferget to fumigate yer yurt rentals 

Winston Churchill's picture

The US banks are just as insolvent as their European brethren.

Its only the Fed infusing money into them thats keeping up the

pretence of life after death.

Dr. Engali's picture

For all you terrorists in New know who you are. You referre to yourself as citizen....New York thinks otherwise.

JR's picture

Dear Simon Black,

Where were you this week when America began her final descent? While you were dreaming of Europe, this beloved country went under the chopping block.

John Roberts with his boyish expression and  modest manners has no likeness to the Bolsheviks. But he has become a key comrade in the final wealth transfer of private property under his surprising one man rescue of repressive collectivism that is causing the cultural and economic tsunami in the United States. It certainly does remind one of the Bolsheviks turning their rampaging mobs onto the landscape to take all of the property they can get.

How else to describe the impacts of a week where the spy from the left, John Roberts, assisted with the smashing of Arizona’s modest attempt to protect the lives and property of its citizens against law breakers.

Justice Scalia’s outburst against this government tyranny via the Arizona decision was so detailed that leftist columnists around the country are all calling for his resignation. But the week was not over. John Roberts had his final hole card to play. He’ll never be in the shadows again; some might say he’s already evolved. But others know: the true Roberts already was there.

What does this have to do with race and culture? Everyone with eyes to see and ears to hear knows the answer. Hispanic groups around the country celebrated wildly, not only the Arizona decision but the healthcare decision. The shocked faces and the surprised faces were white.

What is so sacred that these events cannot be discussed? Why is there this corporate media cover up, demonization, misinformation and obfuscation? Isn’t it time to understand the dynamics of the welfare state and the central planning banker-connection with the destruction of every thread of property rights? A key to this destruction has been the 1965 immigration law and its mythological immigration reform (each new attempt of course bringing in whole new waves of illegals…even now the GOP champion Mitt Romney suggests immigration “reform” is needed…when reform is just another word for open the gates).

Against this week of Obama “hope and change” is it racist to suggest the significance of the Census announcement that as of June 2011 white births are no longer a majority in the United States, that Hispanics accounted for 49.6 percent of all births in the 12-month period that ended last July, minority births, 50.4 percent.  

It was the Jewish claim that America’s immigration laws were racist that led to the push and passage of the 1965 Immigration Act that favored primarily Third World entry into the U.S – until in the decade that ended in 2010 minorities accounted for 92 percent of the nation’s population growth.

“The law was just unbelievable in its clarity of racism,” Stephen Klineberg, a sociologist at Rice University, said of past U.S. immigration policy at the time:  “It declared that Northern Europeans are a superior subspecies of the white race. The Nordics were superior to the Alpines, who in turn were superior to the Mediterraneans, and all of them were superior to the Jews and the Asians."

Roberts rewrote flawed political legislation to adapt it for passage. We can’t have a country when the U.S. Congress knowingly allows known votes for the welfare state, the likes of Sotomayer, Kagan, Ginsberg, and Breyer, to sit upon the Supreme Court, giving them the final word on justice and constitutionality when all they are doing is tipping the scales of justice to their political agenda.

Similarly, Obama is using personal license to thwart the last “legal” remnant available to Arizona to protect her property against invaders, i.e., police check by computer for outstanding warrants and immigration status when a person is stopped for a violation of state or local law.

Said Judge Andrew Napolitano: “Shortly after the opinion came down, the Obama Administration announced that it will cease providing Arizona police with the immigration status of persons in that state, and it will not detain anyone arrested by Arizona police for immigration violations unless those violations rise to the level of a felony…”

Azannoth's picture

The bottom line is this was the final battle of this war socialism vs libertarianism we lost! We are no longer part of the system, there is no reason to participate anymore, time to do an Atlas Shrugged

JR's picture

How appropriate. Thanks ! The primary tool the American government has is the voluntary support given by its citizens; if that is withdrawn there can be no government and, thus, no force.

This conversation below to which you refer between Francisco and Hank Rearden exposes the question as to what happens should Atlas, the producers, shrug, as they will:

"Mr. Rearden," said Francisco, his voice solemnly calm, "if you saw Atlas, the giant who holds the world on his shoulders, if you saw that he stood, blood running down his chest, his knees buckling, his arms trembling but still trying to hold the world aloft with the last of his strength, and the greater his effort the heavier he world bore down on his shoulders - what would you tell him to do?"

"I... don't know. What... could he do? What would you tell him?"

"To shrug."

MeelionDollerBogus's picture

What socialism? There's no socialist collectives, there's no worker-ownership, there's only Fascist corporate merger with the state. That's very much anti-socialist.

Click here to learn

Toolshed's picture

Oh dearie me! You are all upset about immigration laws and their enforcement. Perhaps you should look into the fact that MANY law enforcement agencies across the grand ol US of A have stopped prosecuting numerous laws, including acts of domestic viloence, unless those infractions are of at least a felony in nature, due to budgeting contraints. Priorities people!!! Why are you whining about immigrants when banksters are screwing the living shit out of all of us with absolutely no fear of going to jail. I say let the immigrants have this stinking shit hole of a country. Hell, things may well improve, because they sure as fuck can't get much worse.

/rant off

JR's picture

Perhaps my post had too much of a predicted fatal ending to it, because frankly I’ve been under the impression that the America I loved, grew up in, and prayed for its future had a chance to overcome the tyrants that you mentioned and the wave of Third World immigration that they brought into America to support their positions.

With the events of this week, and seriously you greatly underestimate the profound danger to America that illegal immigration poses, it is no longer a time for complaining. If we are going to save this country we now need to act. And your responses are flippant, irresponsible and, perhaps I’m just being moderate, disgusting.

Toolshed's picture

Yeah.....ok. If I am not mistaken, this country was founded by immigrants. Much of this nations progress and expansion were facilitated by immigrants. Many of the least desirable and lowest paying jobs in this country are performed by immigrants. And in many well documented instances, citizens of this country absolutely REFUSE to work at these low paying undesirable, but essential, jobs even with todays high unemploment rate.  After re-reading your post I have come to the conclusion that your problem is that you are a RACIST. PERIOD.

I also happen to be a white male and was born in Alabama. If I can overcome my own personal racism then anyone can. I feel racism is instinctive and requires a conscious effort to overcome it. Give it a try.

JR's picture

Thank you for your detailed reply. I hope that you are not under the impression that my complaint centers around race because if you are, that seems to be the hot button for all those who would suppress these critical dangers to our country.

Instead, my concerns are the loss of the culture that these IMMIGRANTS established on these shores to escape from the centuries of tyrannical rule in Europe, culminating in the monarchy which would fight these new immigrants to the death to keep them from having representative government and personal liberty.

The Revolutionary War was fought by the sons of these immigrants who established a culture in this country based on Christianity, morality and the worth of individuals. Would you compare John and Samuel Adams, the sons of immigrants, with the sons of immigrants who are killing each other today on Rahm Emanuel's streets in Chicago?

The new immigrants that you cherish not only do not understand these cultural values, but with the help of the banker tyrants, they are provided with the sustenance to break every single foundation of this moral-high-ground culture.

It is important that you and I not argue. But it is important for both of us to understand the real threat to our freedom. If you are correct, then as short as a year from now you will not be able to respond to anything I say unless it is reviewed by a censor. THAT is the world into which you head.

Please stop and realize what you are saying

Escapeclaws's picture

The government was founded by freemasons who are decidedly not Christian. Yes the population was Christian, but what we see now is the triumph of freemasonry over the population. It was there all along but either ignored or regarded as harmless.

JR's picture

It’s difficult to discuss such an important subject when non-facts are used. The country was not formed by non-Christians who were primarily freemasons. To describe the Founders as anything but primarily moral Christians is a ruse used by those who would destroy our culture from within with revisionist history. End of story.

BTW, freemasonry has been misused tremendously in recent years . When it’s connected to the Illuminati it becomes Jewish, and George Washington was not Jewish.

TheMerryPrankster's picture

protecting your national borders is not racism.

A nation without borders is not a nation.

Mexico for instance makes it a felony to be an illegal immigrant in Mexico. are they racists?

MeelionDollerBogus's picture

a Nation with national borders is a disgrace. A nation without national borders is a place of economic boom times. Immigration is just a racist filter to keep out people who otherwise will improve the gene pool and the economy. You let corporations move across borders without restrictions shipping jobs with them - why not let people move across them too? There is no security benefit and no economic benefit to these immigration policies which are strictly anti-freemarket and hurt workers while giving pure profit to corporations who are NOT restricted in the same manner.

The nation-state itself is an economic failure.

The world operates much better at the cell-scale of city-state and "province" / territory with much less central control and much more trade activity.