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Guest Post: A Very Subtle Form Of Theft

Tyler Durden's picture


From Simon Black of Sovereign Man

A Very Subtle Form Of Theft

Say what you want about him, but Bernie Madoff was a guy who knew how to keep the party going. For years, he ran one of the largest private-sector Ponzi schemes in history and always heeded the golden rule of financial scams: make sure your inflows are greater than your outflows.

He was finally done in when redemptions exceeded new investments. He didn’t have enough cash to pay out investors, and he wasn’t able to scam more people into paying in to the scheme. As a result, Madoff finally had to admit that the whole thing was a total fraud.

Governments around the world are in similar situations right now with their own public sector Ponzi schemes. Faced with failed auctions, declining demand, and rising yields, politicians are having to resort to desperate measures.

Like any good scam artist, they’re appealing to the masses first; all over Europe, governments are sponsoring new marketing campaigns suggesting that it’s people’s patriotic duty to buy government debt.

In Spain, they’re actually issuing instruments called ‘Bonos Patrioticos,’ or ‘patriotic bonds’. Ad campaigns say that the bonds are “good for you, good for the future.”

In Ireland, they’ve issued “Prize Bonds” which carry a 0% interest rate; instead of receiving interest, bondholders are entered into a weekly lottery contest.  Naturally, lottery winnings are only possible as long as people keep buying the bonds… pretty much the definition of a Ponzi scheme!

In Italy, they’re rolling out the country’s sports celebrities to encourage everyone to buy Italian sovereign debt.

What’s ironic is that Italy’s dismal balance sheet is almost universally acknowledged. It’s as if everyone knows the country has almost no chance of making good on its obligations, but they still feel the need to willingly throw away their hard earned savings for the greater good of political incompetence.

Thing is, it’s not the millionaire sports stars, wealthy business leaders, or political elite who are buying these bonds… at least, not in anything beyond a token, symbolic amount. It’s the average guy on the street who really stands to get hurt when the government finally capitulates.

This is a truly despicable act and amounts to theft, plain and simple.

The United Kingdom, which is rapidly reaching this banana republic sovereign debt status itself, has unveiled a plan to issue roughly $50 billion in infrastructure bonds. This would be the equivalent of issuing $300 billion in the US– not exactly chump change.

Given Britain’s already colossal debt level, private investors aren’t exact diving in head first to loan the government even more money.

Undeterred, British Chancellor George Osborne plans to ‘highly encourage’ UK pension funds to mop up about 60% of the total amount. “We have got to make sure that British savings in things like pension funds are employed here and British taxpayers’ money is well used,” he said.

In other words, ‘we are going to make sure that British people buy our junk, one way or another.’

The last year has seen numerous pension funds around the world, from the United States to Argentina to Hungary, be raided for the sake of keeping these Ponzi scheme going.  The UK is already lining up to be the next.

It’s one of the last acts of a truly desperate government to begin directing public and private savings into their Ponzi schemes.

Fast-forward a few downgrades and you can plan on seeing the exact same thing in the United States– appealing to people’s patriotism to loan their hard-earned savings (if they even have any) to the Federal government at a rate of interest that fails to keep up with inflation.

It’s nothing more than a very clever (and subtle) form of theft.


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Tue, 12/06/2011 - 16:29 | 1952395 hugovanderbubble
hugovanderbubble's picture

Gold Confiscation coming....World Wide Across all boards....

They want our hard assets... FIGHT

Tue, 12/06/2011 - 16:41 | 1952429 Hard1
Hard1's picture

At least Madoff had class and ran a ponzi scheme that stole from the 1% and wouldn't ruin the world when it busted.  Timmay, Pelosi, Merkozy to the guillotine

Tue, 12/06/2011 - 16:42 | 1952488 Popo
Popo's picture

Guillotines require organization.   I have a feeling the rise in violence that we'll probably see in the PIIGS will be much closer to anarchy.

Tue, 12/06/2011 - 17:00 | 1952582 Dr. Richard Head
Dr. Richard Head's picture

They have anarchy now, which is directed by their heads of state.  Government is anarchy in the fear mindset of that word. 

Tue, 12/06/2011 - 19:09 | 1952641 Manthong
Manthong's picture

I submit that history offers simpler and more appropriate remedies.

Tue, 12/06/2011 - 19:27 | 1953008 WhiteNight123129
WhiteNight123129's picture

Was VLAD the impaler experimenting a new monetary policy to reduce inflation by slaugthering people, therefore reducing velocity?

Tue, 12/06/2011 - 21:15 | 1953305 Papasmurf
Papasmurf's picture

Depends if you're supply side or demand side economist.  Sure, demand would drop.  But supply will drop too. 

Wed, 12/07/2011 - 08:53 | 1954285 Old Poor Richard
Old Poor Richard's picture



Looking forward to a field of stakes in Central Park.

Tue, 12/06/2011 - 17:23 | 1952657 Zero Govt
Zero Govt's picture

Precisely ...anarchy is the State, a small group of violent thieving MF'ers (Bush, Bumma et al) running riot across society

it's not "anarchy" breaking out in Greece etc.. it's society kicking-off against the parasites on their backs.. the Govt

Both the Tea Party and Occupy have to realise they are fighting the same enemy for the same reason: the parasites of Govt sucking society dry and destroying our livelihoods (see the history books how many times Govt has repeated this rape of society)

the best way to fight is simply stop paying your taxes to these parasites ...bleed the suckers

Zero Tax = Zero Govt

Tue, 12/06/2011 - 16:46 | 1952510 falak pema
falak pema's picture

why be choosy, start wit the GS/JPM bankstas!

Tue, 12/06/2011 - 23:37 | 1953612 dolph9
dolph9's picture

In comparison to the jokers running things, Madoff is a hero who should be sainted.

Tue, 12/06/2011 - 16:34 | 1952435 economics1996
economics1996's picture

Buy guns and ammo.

Tue, 12/06/2011 - 16:48 | 1952521 Hippocratic Oaf
Hippocratic Oaf's picture

"it’s people’s patriotic duty to buy government debt"

Only during times of war my friend

Tue, 12/06/2011 - 16:57 | 1952566 duo
duo's picture

WWII bonds weren't such a bad deal.  Because of the gold standard and low inflation, they actually yielded something.  Buying government debt now is pure theft, through inflation (slowly) or currency destruction (quickly).

Tue, 12/06/2011 - 19:23 | 1952998 MacGruber
MacGruber's picture

Agreed, the gold standard made government bonds good as cash. The thing the people in these countries should be fighting for is a structured default - one in which they give up some social services to balance the budget, then kindly tell the banks "no thank you" to the principle due.

The most disturbing aspect about this ponzi is the myth the banks have created, one who’s thesis is that bonds are not a risk instrument. I wish the MSM would present this point; we have it programmed in society that default is bad, when in reality it is the risk exposure that the interest payment is alleged to offset. Without the risk of default all you have in essence are mob-like protection payments to the banks.


Tue, 12/06/2011 - 19:50 | 1953062 TBT or not TBT
TBT or not TBT's picture

California advertises its debt offerings on the radio, to the California listening public, with messages about how great California is!

There is some notion of private individuals being able to buy new isues directly, thereby getting the jump on the big institutions.

What an awesome deal for Joe Six Pack, Jane BoxedWine, and Pat Pothead, to hold a piece of Sacramento issued Golden State bonds!

Tue, 12/06/2011 - 16:43 | 1952446 Popo
Popo's picture

Gold confiscation?   They won't even need to be so obvious.  They'll just tax gold sales, and strictly tarriff imports/exports and thereby confiscate a significant portion of gold's value.   These fuckers will extract wealth at every turn.

The thing is:  That's what the USSR did too.  The game was so rigged that ultimately the only solution was to be a lazy unproductive sloth.   When the system became so rigged that the average man could not win,  the ultimate answer was to be unproductive.    

It's already happening here.   I see it all the time.  How many young people are motivated to work when there are "insiders" in every sector who do 1/10th of the work for 10x the reward?  Young people can either try (and fail) at an obviously rigged game -- or they can play Xbox and smoke pot.   The latter actually becomes increasingly tempting the more rigged the system becomes.

Tue, 12/06/2011 - 16:52 | 1952543 Odin
Odin's picture

lol good post man.

Tue, 12/06/2011 - 17:27 | 1952673 DavidPierre
Tue, 12/06/2011 - 18:31 | 1952897 Temporalist
Temporalist's picture

Everyone is going to be like this:


"Somebody needs to pay...for alll my children."

Tue, 12/06/2011 - 20:51 | 1953255 Chuck Walla
Chuck Walla's picture

Man, she needs to install a toll both on that thing!

Wed, 12/07/2011 - 14:05 | 1955462 buyingsterling
buyingsterling's picture

This doesn't change until paternity tests are required to obtain welfare. Then the 'daddies' can either work or sell a kidney to help pay for the costs of their rutting. Nah, that won't work - they'll just turn to crime/prison or they'll go underground.
So long as welfare exists, we're paying for our own undoing: pay the unproductive to breed and you get more unproductive people. Make it more expensive for the productive to breed and you get less productive people. That's the current formula, the end seems clear over a long enough timeline.

Tue, 12/06/2011 - 19:56 | 1953082 Xanadu_doo
Xanadu_doo's picture

"Young people can either try (and fail) at an obviously rigged game -- or they can play Xbox and smoke pot.   The latter actually becomes increasingly tempting the more rigged the system becomes."


-more and more every single fucking day, man. WOOT!

Tue, 12/06/2011 - 23:35 | 1953602 dolph9
dolph9's picture

I don't work particularly hard and don't really give a fuck.

But I do work, I do save, and I do buy gold.  One foot in and one foot out is how I'm playing it.

Tue, 12/06/2011 - 17:05 | 1952609 Little John
Little John's picture

I will

Tue, 12/06/2011 - 18:00 | 1952819 TeresaE
TeresaE's picture

hugover says, "Gold Confiscation..."

gold, 401(k)s, then stocks.  All will be "borrowed" by the Federal government to fund their own warchests and pensions.

Our savings, that we worked hard to earn then chose to SAVE instead of SPEND is going to be stolen to kick the can and buy off the unions & politician & minions for just a little while longer.

Plunging us all into abject poverty without a pot to piss in.

Enjoy.  I know I question daily why I sacrifice to save when I'm betting there is a better than 50% chance I'm going to have it stolen by the guv and squandered by everyone else except me.

Tue, 12/06/2011 - 19:33 | 1953022 MacGruber
MacGruber's picture

401(k)s are already confiscation. They were originally designed to augment existing corporate pensions, but then morphed into the only savings instrument anyone had, corporations have by and large eliminated pensions. The real genius was making the banks the people who would hold your money for you in a 401(k) - that way they can quietly siphon off fees without a guarantee on returns. A brilliant system, well designed to be both captive and extractive.

Tue, 12/06/2011 - 18:37 | 1952910 In Fed We Trust
In Fed We Trust's picture

Let one jew get caught so the other Jews get away.

Its the Jewish way.

Madoff was the sacraficial lamb to take the camera off of the Goldman/aig/NY Fed fraud of epic porportions.

Tue, 12/06/2011 - 16:31 | 1952407 GeneMarchbanks
GeneMarchbanks's picture

Nationalism on the comeback! This was refreshing from your usual shit...

Tue, 12/06/2011 - 16:32 | 1952414 hugovanderbubble
hugovanderbubble's picture

NeoFascism sir.

Tue, 12/06/2011 - 16:31 | 1952411 non_anon
non_anon's picture

ha ha, nothing like forced giving

Tue, 12/06/2011 - 17:53 | 1952806 onthesquare
onthesquare's picture

when the government prints more money they water down or dilute the value of the money you are holding.  Buying usless govenmnet bonds or having them water down your $US has the same zero sum gain.  it is just more smoke and mirrors.

When the SHTF the only thing that will matter is how to put food on the table.

Tue, 12/06/2011 - 20:27 | 1953182 Dugald
Dugald's picture

Think of what you can do for your country not what your country can do for you.....

Warrants a pithy comment, from a Merikan......

Tue, 12/06/2011 - 16:32 | 1952412 A Lunatic
A Lunatic's picture

The State calls it's own violence law, but that of the individual crime.

-Max Stirner-

Tue, 12/06/2011 - 17:09 | 1952620 OliverTwist
OliverTwist's picture

And so another illusion comes to an end. ... though we have walked a long way on the road of evolution of this social cultural society game, but the basic fact from the begining of time remains still true. The strong will rule over the weak. Don't expect protection from the strong and powerful without paying the price! And don't think of price in terms of money but in terms of life time and freedom!


Tue, 12/06/2011 - 17:08 | 1952625 Little John
Little John's picture

"Rich men write their books of laws for poor meen to defend,

   But true law is only written in the hearts of honest men."


from a song i heard once


Tue, 12/06/2011 - 16:33 | 1952415 jack stephan
jack stephan's picture

damn lightning fast the first guy always says "bitchez!!!" so facehuggers for all bitchez!!!

Tue, 12/06/2011 - 16:32 | 1952418 LawsofPhysics
LawsofPhysics's picture

Precisely why everyone should be going to physical cash and PMs right now.

Tue, 12/06/2011 - 16:34 | 1952427 Shizzmoney
Shizzmoney's picture

And the best part on how we got into this "debt"?  Banks over leveraging themselves, not but bloated pensions or social programs (which can always be modified).

When you prudently borrow money to buy a house or build a factory, you are investing in the future using leverage.  But when a bank uses fancy complex derivatives through opaque secret deals, a bank is linking its balance sheet to risks it may not understand and to systemic threats regulators can’t track.  Banks are essentially making money by throwing dynamite into random mine shafts and hoping they dig a gold mine.  Goldman Sachs and JP Morgan have written credit protection on $5 trillion of global debt, but can’t say how much is Eurozone debt.  This is why our markets have gone crazy – last week, the Dow jumped by 400 points in one day, after swooning in November and nearly crashing in August.  Asset prices these days reflect guesses about which stick of dynamite will go off, as opposed to doing what markets are supposed to do, which is reflect prudent profit making potential of securities and credit instruments.

When balance sheets are linked across the world, that creates the possibility of a systemic collapse.  One day, you’re wealthy, the next day, you’re insolvent, and so is everyone you know.  Secrecy magnifies the problem, because it means that we cannot prepare for shocks.  None of this is inherent.  If derivatives were put on exchanges with multiple bidders and sellers, at least we could more easily see price movements that indicate risks.

Tue, 12/06/2011 - 17:40 | 1952766 theprofromdover
theprofromdover's picture

"......Goldman Sachs and JP Morgan have written credit protection on $5 trillion of global debt...."

-that they can never cover. Now even in a corrupt world, there must be some authority who can be enjoined to demand to see how the books balance.

Even the auditors for Cheesy's sake.

Tue, 12/06/2011 - 16:35 | 1952439 JW n FL
JW n FL's picture



anything but tax those fucking scumbags who made billions and paid no fucking taxes!

there is plenty of money to carry the debt!

but no one wants to pay for it!

they all believe that living like animals / austerity is better than keeping the sheep comfortably numb!

when people start a class war.. then they will think that paying an extra 5% wasn’t so bad!


maybe they already know that..

maybe the sheep are using up to many non-renewable resources?

maybe all this information is being made available to start drama in hopes of thinning the herd?

Al Bartlett on energy consumption versus population

Tue, 12/06/2011 - 16:41 | 1952480 JW n FL
JW n FL's picture

Never Mind! We are ALL! Saved!!

U.S. stocks hit intraday highs on report of new firepower in Europe's debt-crisis fight
12/06/2011 03:07:27 PM

Get the latest news on our mobile site:

Tue, 12/06/2011 - 19:57 | 1953086 Xanadu_doo
Xanadu_doo's picture

totally bullish -- lots of new 52-week highs, I'm sure, if one looked hard enough... /sarc

Tue, 12/06/2011 - 16:35 | 1952440 catacl1sm
catacl1sm's picture

they will come for your preciouses.. be sure to have a boating 'accident'.

Tue, 12/06/2011 - 18:55 | 1952946 CPL
CPL's picture

Hmmmm...time to buy a boat.

Tue, 12/06/2011 - 19:52 | 1953066 TBT or not TBT
TBT or not TBT's picture

Why not 'robbery'.

Tue, 12/06/2011 - 16:36 | 1952445 vegas
vegas's picture

Only an idiot would buy European Government debt [or US debt for that matter]. Who cares about getting an extra 1/2 % interest rate, when you know it's just a matter of time before default.

What is voluntary today will be mandatory tomorrow, especially for retirement accounts. Get the hell out now.

Tue, 12/06/2011 - 17:19 | 1952666 s2man
s2man's picture

Agreed.  I expect them to ease into it with, perhaps, "All new deposits will go into TSY's". Followed by "All tax exempt retirement accounts will be converted to TSY's".  Followed by "Oops, they are no longer tax deductible".

I'm gittin', I'm gittin'.  I'll be making my third and last annual withdrawal in January, which will just about wipe out the 401k.  It all goes into tangible goods.

Tue, 12/06/2011 - 18:02 | 1952829 onthesquare
onthesquare's picture

So you buy into this scam with your euro dollar, the same euro dollar that will buy a loaf of bread (day old).  It sits around and rakes in interest and then  you cash out on maturity and take all your new wealth and capital home to fine that the growth was only 1/2 of what it now costs to buy a loaf of bread. 

Your investments buying power has halfened.  So long suckers.

Tue, 12/06/2011 - 16:37 | 1952456 CvlDobd
CvlDobd's picture

Just because you talk about madoff inflows and outflows, you still aren't Kyle bass.

Tue, 12/06/2011 - 17:03 | 1952598 willien1derland
willien1derland's picture

One doesn't need to be Kyle Bass to appreciate the context of the explanation - I am no Kyle Bass nor do I possess the insight of Tyler Durden but I think all ZHers possess the intelligence to recognize great resources, concrete evaluations & analysis, & apply this knowledge to ones actions...Dude, don't hate the player, hate the game!

Tue, 12/06/2011 - 16:37 | 1952457 Bam_Man
Bam_Man's picture

In Japan they are now giving a half oz. gold coin to individuals who buy Government bonds.

We are not far removed from the day when Central Banks will be the only buyers.

Tue, 12/06/2011 - 16:46 | 1952511 A Lunatic
A Lunatic's picture

That will prove to be one hell of an expensive 1/2 oz of gold.

Tue, 12/06/2011 - 17:13 | 1952622 Bam_Man
Bam_Man's picture

Very expensive, since you have to purchase 10 million yen ($125,000) minimum in order to qualify. That works out to $250,000/oz!

Tue, 12/06/2011 - 17:37 | 1952750 s2man
s2man's picture

But you can get a silver coin for only $12,500.  The poor-man's bond.

Tue, 12/06/2011 - 21:03 | 1953283 Chuck Walla
Chuck Walla's picture

They wil try mightily to steal the IRA's an 401Ks.  Senator Harkin is on his knees nightly praying to Gaia for a sign that it is time to commence the theft. he's already held hearings. Harkin never saw a dollar of someone else's he didn't want to spend.

Tue, 12/06/2011 - 16:44 | 1952498 tony bonn
tony bonn's picture

these politicians are gross filth...what fucking pieces of shit....

Tue, 12/06/2011 - 16:46 | 1952509 astoriajoe
astoriajoe's picture

I must misunderstand the meaning of subtle.

Tue, 12/06/2011 - 16:50 | 1952535 SillySalesmanQu...
SillySalesmanQuestion's picture

Subtle for the sleeping sheepie who are'nt awake yet and or don't read ZH...WAKE UP!!!

Tue, 12/06/2011 - 18:05 | 1952845 onthesquare
onthesquare's picture

finding the silver lining to the cloud it would seem there are still idots out there with money.  When will we run out of idiots with money? )rhetorical.

That is when the true decisive end will be met.


Tue, 12/06/2011 - 16:48 | 1952520 EverythingEviL
EverythingEviL's picture

What kind of idiot would even be patriotic anymore when it's plain to see that all these governments are as evil as can be? The have no allegiance to their citizens, why should we to them? Any citizen who buys a "patriotic bond" is either brain dead or plain stupid. Screw the .5% interest and buy something tangible with your money. Food anyone?

Tue, 12/06/2011 - 16:55 | 1952557 CvlDobd
CvlDobd's picture

I'm with you. I've been trying trying to show the freedom isn't free and I support our troops crowd a few things. The agenda is known! Anyone who can't see it an signs up for the military deserves what they get. Tribes in Afghanistan are not impeding freedom like the 61 habeausbcorpus hating senators are. The enemy is at home!

Tue, 12/06/2011 - 17:31 | 1952721 MissCellany
MissCellany's picture

Many people (I was one of them) who have the capacity for patriotism, have yet to understand the distinction between our country and "our" government.

That's where the tragedy lies.

Tue, 12/06/2011 - 18:10 | 1952858 onthesquare
onthesquare's picture

Right on man.

There are other ways to be patriotic without sending your hard earned, after tax dollars, to the man. 

Go out and pull garbage out of a stream, pick up garbage in a park, buy a child a warm meal why should he suffer for having morons for parents? There are lots of ways to be patriotic than handing money over to idots.

Wed, 12/07/2011 - 01:23 | 1953915 L.O.C
L.O.C's picture

Love your country, hate your government!

Tue, 12/06/2011 - 18:37 | 1952909 Temporalist
Temporalist's picture

You mean it's not a good idea to buy bonds from leaders installed by Goldman Sachs who also previously worked for or with Goldman Sachs?

Who would've thought?!?

Tue, 12/06/2011 - 16:53 | 1952549 FranSix
FranSix's picture

You can't force a trader to buy long term debt when the price is high and yields are low if they can buy at a lower price and higher yield.

On that note, there hasn't been any news on the most recent 30-year U.S. treasury bond auction, but lots of flogging in the press about how risky government debt is in Europe.

Tue, 12/06/2011 - 16:55 | 1952556 TideFighter
TideFighter's picture

Gold confiscation is a moot point as gold will be rendered insignificant. Goldbugs somehow deny that gold is the single asset class that cannot be manipulated, yet cry manipualation at every correction. Since US no longer holds gold, the Fed will print to oblivion.  I agree that while gold is a secret store of value (physical), the future value of 1 ounce of gold will still be equal to a man's new suit.

Now ask me about a barrel of oil....

Tue, 12/06/2011 - 17:16 | 1952650 carguym14
carguym14's picture

What abouit a barrel of oil??

Tue, 12/06/2011 - 17:29 | 1952715 Ignatius
Ignatius's picture

Why would one ask you about oil as you are apparently still struggling to understand gold?

Fun fact: When the rights were originally granted to drill for oil in Saudi Arabia, the payment was 35,000 British Sovereigns (that would be gold) which, we're told, the King counted himself.


Tue, 12/06/2011 - 16:56 | 1952562 Sudden Debt
Sudden Debt's picture

Here in Belgium they sold of quite a bit of bonds to the people at 4%

I personnaly know quite few people who couldn't resist it. And when I told them STAY THE FUCK AWAY FORM THAT, they just looked like a deer in the headlights.

And markets went green and they saw that they couldn't lose so they'll buy more....


Tue, 12/06/2011 - 16:57 | 1952564 Snakeeyes
Snakeeyes's picture

What about Bernie Bernnke and Tim Madfof?

Tue, 12/06/2011 - 16:57 | 1952565 willien1derland
willien1derland's picture

I must admit I laughed when I contrasted/compared each countries' approach to 'fund raising' & especially appreciated the Irish as the gambling component at least spoke to some appreciation regarding risk/reward as a function of time and the zero interest rate basically relegated the Prize Bond to a Lottery Ticket...which on a relative basis provides an approach that has more integrity than their EU counterparts - unfortunately the PONZI is FULL FORCE - Recently, with calendar year end approaching many large organizations are providing economic updates for their clients/customers. Although I appreciate the effort each one I have attend attempts to promote the most optimistic SPIN they can...and I have become more annoyed with each successive presentation I am ask to attend - as Kyle Bass would say - I do not get paid for being an optimist or pessimist but a realist - today I listened to a very large multi-national company present their economic update & the presenter tried to spin US interest expense as a percentage of aggregate US GDP indicating that it was merely 3% and this was easily managable...During Q&A I was compelled to question him on the measure as I could not see it's actionable value - the projected US interest expense for this year is $454.4 BILLION & FY 2012 Total Direct Income is projected at 2,627.5 BILLION USD which represents roughly 17.2% of the PROJECTED FY2012 TOTAL DIRECT REVENUE BUDGET - I highlight this example for 2 reasons - FIRST - to THANK THE ZH Community for be BOLD HONESTY & PROMOTING TRUTH & CRITICAL THOUGHT - SECOND - because I have found that the majority of others are far more willing to abdicate their thought processes to others - This site provides a VITAL service & I am grateful...Note that the presenter was much happier with his metric, however, he did admit that I made a valid internal thought as I ignored his inane explanation -->There are too many Sheeple BITCHEZ!

Tue, 12/06/2011 - 17:02 | 1952589 Mark123
Mark123's picture

Markets all over the world are levitating based on co-ordinated central bank (abetted by governments) manipulation (money printing etc).  There is no logic anymore and the supporting framework is very fragile.

Tue, 12/06/2011 - 17:03 | 1952593 Iconoclast
Iconoclast's picture

Pensions, biggest ponzi scheme ever..

Tue, 12/06/2011 - 17:09 | 1952629 walküre
walküre's picture

I've always felt that there is only one thing that distinguishes Bernie and Bennie. The ability to "create" money out of thin air, the ability to print money and enforce that that paper is accepted as currency.

In short, the difference between Bernie and Bennie is a certified printer and certified paper.

Absolutely everything else is the same.

Why is Bernie in jail? He's actually a hero of sorts.

Tue, 12/06/2011 - 17:12 | 1952638 infinity8
infinity8's picture

I wish he had provided links to coverage of the various EU tactics. Before this mornings ZH post about Japan giving out gold, I hadn't heard any of this. Crazy and scary.

Tue, 12/06/2011 - 17:27 | 1952707 RobD
RobD's picture

I have seen it asked a number of times but have not seen any answer. Has the Treasury replaced the fed pension funds they took during the debt limit fiasco?

Tue, 12/06/2011 - 17:48 | 1952787 Hannibal
Hannibal's picture

I'll keep my stash (hidden and) buried in a hole in the ground, thank you very much!

Tue, 12/06/2011 - 17:48 | 1952789 css1971
css1971's picture

Next up. War bonds.

Tue, 12/06/2011 - 17:52 | 1952804 JR
JR's picture

All of these are end times developments.

The main problem the European market has is that investors are looking at it like I am. I wouldn’t want to go in and buy some long-term investment portfolio based on the euro and its future. Any bookmaker would say you can’t give the euro 100 percent for the future.

Economics depends on the participation of buyers and sellers. Someone has to produce, and someone has to consume and with their labor pay for it. That is far, far above what the Goldman Sachs management will be able to control. The closer they come to nailing all these worldwide schemes down the closer we come to ushering them out. They don’t have an economic model; their model is to steal the money. That doesn’t support economic growth; it supports anarchy and revolution and hanging people from the lamp posts.

An economy cannot be controlled; it can be managed, but in order to manage it, at least the common man has to agree to the terms. Even the monarchies in Europe understood this. These people don’t have a plan for the good of the people and their countries’ survival. Instead, they are like the WATTS rioters; they just break windows and grab the tvs.

If they were interested in “managing” the economy they would be pulling back on the debt and pulling some of the obvious criminals off the streets and putting them in jail. In the mortgage crisis, thousands broke the law and encouraged crime. Nobody paid. 

They have Simon Legree’s understanding of how things work; you whip the slaves and they’ll work.

Entities are going to have to start defaulting against them. When Von Rompuy comes with a paper that says he owns the factory, owners will say then you’ll have to come and take it. People have to get something in return or they’re not going to cooperate with central theft; all their contracts, all their bureaus, all their commissions, all their edicts increasingly are in danger of simply being ignored.

As they desperately keep propping the markets up against bad economic news that gets worse and worse, as they more and more threaten loss of sovereignty and punishment if you don’t pay up, the people who aren’t rebelling now, will be.

Tue, 12/06/2011 - 18:27 | 1952892 William Wallace
William Wallace's picture

My question is:  Who will restore the rule of law?

Suppose the banker gang is somehow thrown out of power.  Can the U.S. Congress restore the rule of law?  Obama?  Gingrich?  Federal bureaucracy?  Donald Trump?

We are currently living in a lawless society.  I am sorry to say that I don't see any plausible scenario for the rule of law being restored.

Next stop:  New Dark Ages.

Tue, 12/06/2011 - 19:00 | 1952952 JR
JR's picture

A good question. Here is how I see it.

There exists an oral understanding by Americans that we are being governed by the Constitution; those provisions if properly followed could restore our country to a Republic. When predicting future developments, it’s important to realize that the political landscape does not change in only one aspect.

For example, if the bankers are removed, the Congress would not likely be the same kind of Congress as present; along with the bankers, many of the scoundrels would be gone as well and the banker influence on politicians would be greatly reduced.

Frankly, men such as Gingrich and Donald Trump would be nowhere to be seen as their contributions would be completely ineffective without lobbyists.

The important thing to remember is that you don’t just removed the bankers; you remove instantly their hand from the nation’s institutions and industry. An emphasis on the Constitution would restore states’ rights and abolish much of the central government’s intrusion into business, family life and the progress of individuals and free enterprise.

IOW, when you remove the core problem you take with it, instantly, the periphery. The Supreme Court, for example, would be reduced to ruling only on the constitutionality of the newly found independence and the newly recovered power of the Congress. In that the Supreme Court is to rule only on the constitutionality of the law, a strong Congress would see to it that the Court did not create legislation.

Most all of this could be accomplished within two or three days of congressional sessions.

If the people force the international bankers out, suddenly the Congress as the representatives of the people will have new power….

Tue, 12/06/2011 - 20:05 | 1953118 Xanadu_doo
Xanadu_doo's picture

yep. exactly. all good. except we lack the leadership, political will, testicular fortitude, and many, many other things to actually accomplish any of this, even a glimmer. Our leaders are not leaders, they follow the squid. we are totally effed, and that's all there is to it. Best you can hope for is to have land, food, water, guns and stockpiles of the above.


PS: Cheers, bitchez.

Tue, 12/06/2011 - 18:28 | 1952893 GCT
GCT's picture

Nothing is going to happen in the USA or Europe until people loose entitlements then the SHTF will actually happen.  As long as TPTB can run the scheme and people are fed they will continue to allow the ruling class to rip them off.  Afterall they have their TV, reality shows and the newest iPad!

Tue, 12/06/2011 - 18:34 | 1952903 alagon
alagon's picture

I don't trust any government. I'm expecting the shit to hit the fan in about 2 years. I''ll be ready to move to Canada.  BTW, didn't Meredith Whitney say something like "It's your patriotic duty to buy government bonds"?

Tue, 12/06/2011 - 19:06 | 1952969 Kayman
Kayman's picture

Drink this.... it's your patriotic duty....


Tue, 12/06/2011 - 19:30 | 1953018 JR
JR's picture


Man, do I miss seeing your gems around: such as this one I ran across the other day, a copy inserted in one of my books, written nearly two years ago:

The IMF is the United States banking cartel. The World Bank is the United States banking cartel.  The Federal Reserve is the United States banking cartel.


All the obtuse borrowing throughout the world has led to asset value perversions. The Greeks have consciously borrowed themselves into a financial trap, relying on continuous rollovers.


I believe the responsibility falls equally on the dealer and the drug addict.


And ultimately the Greek calamity is coming to a country near you (and me).


And don't forget the mantra "ZIRP leads to ZIG" Love it.

Tue, 12/06/2011 - 19:29 | 1953013 daxtonbrown
daxtonbrown's picture

Governments don't have any choice BUT to start confiscating funds, they are flat assed broke.. Hard assets, soft assets, your ass, it doesn't matter, they will try to take it. The Ponzi game is coming to an end worldwide. About the only way out is to Go Galt. There's a lot of ways to do it, not just buying gold, guns and beans. Get some money out of country. Buy tools. Start a garden. Learn a physical trade. Not much time left.

Tue, 12/06/2011 - 19:30 | 1953016 alagon
alagon's picture

Liberty is incompatible with statism. Government=king. Taxpayers=slaves.

Tue, 12/06/2011 - 20:00 | 1953097 Pumpkin
Pumpkin's picture

Fiat money is fiction.  It is worthless paper created to control the world.  There is a problem because those who contol the fiat want the problem.  A problem that serves THEM.  I believe the Fed is controlling this dance.  The oil dollar was being threatened.  Euros was going to be accepted for oil.  This "problem" we have can easily be solved by printing.  Printing is a huge problem for the Euro, not for the Fed.  The one huge weakness of the Euro (normally a huge benefit for people holding it) is being exploited.  If the ECB prints, solid economies will rebel or leave.  If the don't, the Euro will implode.  Make no mistake, this is no mistake.  The Ivy Leagues do not produce dim wits.

Tue, 12/06/2011 - 20:31 | 1953199 gookempucky
gookempucky's picture

The USSa already dipped its wick before europe with BABS otherwise known as the American Recovery act....of course state borrowing of funds  through BABS was 181 billion and yes has to be repaid..not by the state but from the states taxpayers.

I personnally look for more debt issuance kocklimp programs. From the treasury.

Remember its all a debt trap...all of it.

Tue, 12/06/2011 - 22:31 | 1953470 HungrySeagull
HungrySeagull's picture

Government and Country are two different things.


Love the Country you govern, do not let the system govern you.

Tue, 12/06/2011 - 23:11 | 1953558 rosiescenario
rosiescenario's picture

Comparing Madeoff with governments is silly....Bernie did not have a printing press.

Wed, 12/07/2011 - 00:58 | 1953854 RECISION
RECISION's picture

I am currently reading "Dying of Money" by Jens Parsson (Mises Institute).


Have a read, it is like Jens and Simon are the same person, talking about the same thing.  Except one is  about the 1920's and the others about here and now.  FREAKY...

Or maybe not, if every paragraph that Simon wrote above, could have been lifted from Jens essay, then probably all that means is that the old cons are still the best cons.

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